The National Guarantee Fund (NGF) signed agreements with five commercial banks to grant portfolio guarantees for 50 millions Leva. The banks are DSK Bank, Raiffeisen Bank, FIB, MKB Unionbank and International Asset Bank. Currently NGF is negotiating the agreements with another seven financial institutions: UBB, CIBank, SG Expressbank, Unicredit Bulbank, Alianz Bank, CCB and Teximbank.
The agreements’ purpose is to simplify the Bulgarian small and medium enterprises’ access to bank funding through additional credit guarantees. The NGF capital is 80 millions Leva. The Fund will cover 50% of the credit risk; the other 50% will be covered by the partnering bank. The guarantee agreements conditions well be equal to all the banks, which concluded such agreements with the Fund.
The Fund will offer two guarantee programs to the partnering banks. The first will allow issuing of guarantees to small and medium enterprises, wishing to obtain investment credits. Start-up companies and companies, active for more than 1 year will have the right to apply for the credits. The biggest guaranteed amount for start-ups will be up to 250,000 Leva and for active companies up to 500,000 Leva. The guarantees may be used for 10-years credits.
The second program is for export-oriented companies, wishing to obtain turnover credit. In this scheme, the guaranteed amount for both start-ups and existing companies will be up to 250,000 Leva and the guarantee will be valid for 2 years.
The commercial banks took the commitment to review the companies’ credit applications faster in the presence of NGF Guarantee and to offer more flexible securing schemes and more favourable interest terms.
The National Guarantee Fund is a Bulgarian Development Bank subsidiary, established in the end of 2008. The experience of guarantee funds from France, Austria, Italy, Belgium and other European countries was used in the establishment of the National Guarantee Fund.
