Extension of the Framework for SME Financing in Croatia

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DM 60 million (EUR 31 million) extension of the framework facility for a number of majority privately owned Croatian banks, established and operating under the laws of Croatia. Project objectives: The framework facility represents a maximum amount of funding designated for financing a number of financial intermediaries in Croatia. The financing will be on-lent to small and medium sized projects on a case-by-case basis. Part of the loans (e.g. 30 per cent) will be used for financing mortgage lending. The framework facility will allow further support to be provided to SMEs through the provision of long-term funding for investment projects and support for further development of the mortgage financing market. The facility will promote the development of a market-oriented economy by supporting the growth, development and strengthening of private sector financial institutions in Croatia. It will also support the private sector in general by providing the necessary term funds for the development of small and medium sized private enterprises. In addition, the establishment and implementation of the framework would provide a competitive tool for the local banks and allow the Bank to impose conservative covenants aimed at improving the operations of individual institutions (e.g. a reduction of off-balance-sheet exposure, increase in liquidity etc.). Four or five private Croatian banks, with an established track record in operations, demonstrating good on-going financial status, professional management and experience in financing small and medium-sized enterprises (SMEs). Framework facility for an aggregate amount of up to DM 60 million (EUR 31 million), with a minimum commitment of DM 5 million and a maximum commitment of DM 20 million per bank. DM 60 million (EUR 31 million) Participating banks will follow the EBRD's Environmental Procedures for Intermediated Lending through Local Banks in relation to all sub-loans financed through credit lines. In implementing these procedures, the participating banks will assess potential environmental issues associated with sub-projects, which are required to comply, at a minimum, with local/national health, safety, environmental and public consultation requirements. None