SOFIA (Bulgaria), August 5 (SeeNews) - The Bulgarian Development Bank's (BDB) National Guarantee Fund (NGF) said on Friday that it signed an agreement with United Bulgarian Bank (UBB), part of Belgian financial services group KBC, to provide financing to support local micro, small and medium-sized enterprises (MSMEs) under a loan guarantee mechanism.
As part of the agreement, UBB will offer MSMEs loans totalling 192 million levs ($100.4 million/98.2 million euro), NGF said in a press release.
The agreement brings to 10 the number of banks with which the state fund has partnered to date, with a total credit limit of 674 million levs.
The total potential amount of credit financing available to MSMEs under the programme is some 1.4 billion levs, with an estimated 5,000 businesses to receive support, NGF added.
The guarantee mechanism is targeting existing and start-up MSMEs, with the guarantee covering up to 50% of the amount of loans granted. Investment and working credit lines will be available as well as bank loan guarantees.
The main advantages of the NGF guarantee scheme are preferential prices and collateral discounts compared to standard commercial banks, as well as the possibility to guarantee credits for financing European projects, the BDB fund noted.
In June, NGF partnered with the leasing units of local lenders UniCredit Bulbank and OTP Bank for the provision of lease financing of 157.5 million levs to local MSMEs.
(1 euro = 1.95583 levs)
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