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Bulgarian Banks Grant Loans of up to 1 M Levs to Small Businesses

Wednesday, Dec 03, 2008

In the conditions of a global financial crisis the small and medium-sized businesses can draw banks loans of up to one million levs (1euro=1.95levs) to solve their financial worries. The loans are granted by the Bulgarian Bank for Development (BBD). BBD will grant credit lines of up to ten million levs to commercial banks which can later be distributed among the small businesses. The funds will be allotted for long and short-term target loans, pre-export financing and for the financing of small and medium-sized business projects under the EU structural funds. BBD CEO Angel Gekov said the interest on their loans was one of the lowest in Bulgaria. The loans will be secured according to the standard requirements of the Bulgarian banking system.
The credit lines will be allotted to the banks for ten years with a five-year grace period.
"To be granted credit lines, the financial institutions should meet certain requirements, among them being a declaration of their owners stating that they give up on the payment of dividends," Gekov said.
Seventeen commercial banks have already applied to receive credit lines from BBD.
The refinancing of the commercial banks is part of the "market flexibility" set of measures of the Bulgarian government, meant to minimize the effects of the financial crisis on the country's economy. The capital of BBD will be increased by 500 million levs, which will be used for target financing of the commercial banks and also to facilitate the access to financing of small and medium-sized businesses.
Kristian Kosturkov

Source: Standart newspaper