Erste Bank Hungary SME Facility

complete

The EBRD is providing a senior loan to Erste Bank Hungary. The proceeds of the loan will be used to provide medium and long-term financing to Hungarian private independent SME companies, for implementing investments or covering working capital needs. The proposed project is part of EBRD’s overall response to the impact of the global financial crisis as well as to macro-economic imbalances in the Hungarian banking sector and its impact on the real economy; The proposed transaction therefore aims at supporting the private local SME sector. The proposed credit line will contribute significantly to the transition process as follows: Erste Bank Hungary, part of Erste Bank Group, a private commercial bank organised and functioning under the law of Hungary. Erste Bank Hungary is the 6th largest bank in Hungary with a 7.8 % market share of total banking assets at the end of 2008. Senior loan of up to € 100 million to be used for on-lending to the private SME sector in Hungary. € 100 million. Erste Bank Hungary (EBH) will be required to comply with the EBRD's Performance Requirements for FIs (specifically, PR 2 and 9). EBH will be required to adhere to the EBRD's Environmental and Social Exclusion and Referral Lists and submit annual environmental and social reports to the EBRD. None.