September 12 (SeeNews) - The European Bank for Reconstruction and Development (EBRD) said on Monday that it agreed with Bulgaria's DSK Bank, part of Hungarian OTP Group, to increase the limit of unfunded risk sharing to 75 million euro ($76 million) from 30 million euro.
The deal will help enhance the competitiveness of Bulgarian small and medium-sized enterprises (SMEs) by improving their access to additional financing, the EBRD said in a press release.
The EBRD will share the risk of individual eligible loans that DSK Bank provides to local businesses.
"Disbursement of funds under the new line will not differ significantly from the usual credit process. The risk-sharing scheme will allow Bulgarian companies to receive support from the EBRD, without the additional complications and difficulties that usually accompany cross-border financing," DSK Bank executive director and head of risk management Arnaud Leclair said.
The agreement is a continuation of a previous deal that the EBRD originally signed with French lender Societe Generale's Bulgarian subsidiary Societe Generale Expressbank in 2017. Societe Generale later sold its majority stake in Expressbank to DSK Bank. Expressbank was merged into DSK Bank in May 2020.
The EBRD’s Risk Sharing Framework (RSF), one of the three core financing frameworks of the lender's Small Business Initiative, enables the EBRD to share partner banks’ exposures to local enterprises through funded or unfunded risk participation.
($ = 0.986536 euro)
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