BSTDB and Bulgarian National Guarantee Fund Join Forces in Supporting SMEs Amid Pandemic Crisis
Press Release | 06-Dec-2021
First of its kind Pandemic Response Programme agreement signed today
Today in Sofia the Black Sea Trade and Development Bank (BSTDB) and the National Guarantee Fund (NGF) signed a “Framework Agreement for Pandemic Crisis Response Programme”. Under the Agreement, the BSTDB joins the NGF in supporting Bulgarian small and medium-sized enterprises (SMEs) and corporates by offering guarantees to Bulgarian commercial banks. This guarantee Programme will facilitate access to finance and improve financing conditions for final borrowers. The Programme is expected to promote up to EUR 75 million of new financing and help about 250 local SMEs to offset the negative impact of COVID-19 in the country.
The National Guarantee Fund specialises in issuing guarantees to commercial banks in support of SME lending activity. The Programme, to be implemented jointly by NGF and BSTDB, will strengthen the BSTDB’s strategic partnership with the Bulgarian Development Bank, the parent institution of the NGF.
The joint Programme prioritises provision of off-balance sheet instruments such as guarantees, including unfunded risk participations, especially where these may improve external mobilization of financing for SMEs. Given the ample liquidity available to the financial sector in Bulgaria, the guarantees to commercial banks are a viable and practical alternative to support the economic activity and to increase BSTDB’s presence and development impact in Bulgaria.
Dmitry Pankin, BSTDB President, commented: “We hope our first joint programme with the National Guarantee Fund will prove an effective tool enabling the Bulgarian Government to step up its support to the SME sector, largely affected by the pandemic and giving BSTDB the opportunity to provide diversified support to the financial sector in Bulgaria. We are looking forward to working together with NGF, an experienced and knowledgeable partner, to develop this product which could be offered in other countries of our Region to improve the access of SMEs to finance and to tackle the impact of the pandemic crisis.”
“This agreement will benefit hundreds of local businesses, and I am thrilled that we take this step with a long-trusted partner. It is yet another testament of our leading role as a guarantee institution more so in these difficult times.”, said Todor Todorov, Executive Director of National Guarantee Fund (NGF)
The National Guarantee Fund was created in 2008 as a part of the Bulgarian Development Bank Group. The Fund issues guarantees that complement the collateral required by the commercial banks under loans for Bulgarian businesses. Thus, it facilitates the access to financing for SMEs and contributes to the decrease of granted loans’ interest rates. NGF’s support enables loan financing to start-ups and to companies with no previous credit history. As per today the Fund has issued guarantees for BGN 1,340 million and has supported over 10,000 companies.
The Black Sea Trade and Development Bank (BSTDB) is an international financial institution established by Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Greece, Moldova, Romania, Russia, Türkiye, and Ukraine. The BSTDB headquarters are in Thessaloniki, Greece. BSTDB supports economic development and regional cooperation by providing loans, credit lines, equity and guarantees for projects and trade financing in the public and private sectors in its member countries. The authorized capital of the Bank is EUR 3.45 billion. BSTDB is rated long-term “A” by Standard and Poor’s, “A2” by Moody’s and “A+” by the Russian credit rating agency ACRA. For information on BSTDB, visit www.bstdb.org.
Contact:
Haroula Christodoulou
E-mail: cchristodoulou@bstdb.org
Phone: +30 2310 290533
Twitter: @BSTDB; @Haroulax
