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EBRD strengthens SME funding in Romania
€10 million credit line to Bank Leumi Romania
Small and medium-sized enterprises in Romania will benefit from a new €10 million credit line the EBRD is extending to BANK LEUMI Romania (BLR). The proceeds of the loan will be on-lent to small and medium-sized enterprises (SMEs) active in the industrial, construction, trade and services sectors in the country. Sub-loans under the credit line will typically not exceed €125,000.
The EBRD is providing the loan under the EU/EBRD SME Finance Facility*. The loan will support further development of this sector by enabling a wider range of entrepreneurs to have access to medium to long-term funding. The credit line will be distributed through many of BLR’s branches and agencies across the country with the main purpose of reaching as many new clients as possible.
An additional €300,000 of technical assistance funds will be made available to help with training of loan officers in credit analysis and loan monitoring of products.
Ambassador Donato Chiarini, Head of the Representation of the European Commission to Romania, said that this facility will enhance the support for Romania’s SMEs and it will help the growth of this dynamic sector in Romania. The Commission has and will continue to support such initiatives in Romania, Mr. Chiarini said.
Jean-Marc Peterschmitt, EBRD’s Director for Bank Relationships, said this loan will support BLR’s already good achievements in the SME financing. Supporting BLR with its extensive branch network will help to make a substantial contribution to the underserved SME sector in Romania and the development of financial services in the country.
EBRD’s support for small, private businesses in Romania demonstrates the Bank’s commitment to promote private entrepreneurship and is a continuation of EBRD’s strong and productive cooperation with local investors, Mr Peterschmitt said.
Mr. Zalman Segal, Chairman of Supervisory Board of BLR said that this facility would enhance support for Romanian private SMEs and Laurentiu Mitrache, CEO of BLR, noted that this loan will allow BLR to meet the demand for loans in foreign currency and increase the availability of financing to SMEs. The loan will be distributed across the country with the main purpose of reaching as many new clients as possible, Mr. Mitrache said.
Prof. Daniel Tsiddon, Executive Vice-President of Bank Leumi Le-Israel B.M. said that this first transaction with EBRD has a particular importance as it signifies the start of a good cooperation with a reputable international financial institution. I hope that this will be further developed not only in Romania but in many other EBRD countries of operations, Mr. Tsiddon said.
BLR is a private Romanian commercial bank fully owned by Bank Leumi Le-Israel. BLR is already extending financing to Romanian private SMEs from its own funds. Further financial support to this dynamic segment of the Romanian market is one of BLR’s strategic targets.
* The EU/EBRD SME Finance Facility, a joint programme of the European Commission and the EBRD, supports the development and growth of entrepreneurs by facilitating their access to finance. Under this regional project covering 11 countries, EBRD has committed over €1,146.5 million to date since the launch of the facility in 1999, supported by EC grant funding from the Phare programme of [€151.5 million]. The Phare programme is the main channel for the EU’s financial and technical cooperation with accession countries. For further information, see: http://europa.eu.int/comm/enlargement.
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