The European Investment Bank (EIB), the European Union's long-term lending institution, is providing further EUR 16 million (1) support to the private sector in Croatia, in the form of a global loan (2) to Privredna banka Zagreb d.d (PBZ). The EIB funds are intended for financing small and medium-sized investments in industry, the service sector, and infrastructure projects proposed by both public and private promoters in Croatia.
Privredna banka Zagreb (PBZ) was founded in 1962 and has consistently been a leading financial institution on the Croatian market with an established business base and recognized national brand name. In early 2000, PBZ became a member of Gruppo IntesaBci - the largest Italian banking group and one of the most significant financial institutions in Europe. Operating as a universal commercial bank, PBZ is today the second largest bank in Croatia, enjoying a nationwide presence. It is a leading bank in catering to SMEs, having formed strategic partnerships with HBOR, the Ministry for SMEs, as well as the entrepreneurial community. Also, PBZ intends to further expand activities with SMEs in Croatia especially in the tourism sector, shipbuilding industry, family business etc.
Further to the global loans to the HVB Bank Croatia (HVB Croatia) signed in October 2001 and to the Croatian Bank for Reconstruction and Development (HBOR) signed in November 2001, this new EIB global loan, contributes further to the availability of domestic long-term lending facilities in the country.
The EIB loan is provided under the current mandate for Central and Eastern Europe, which was also extended to Croatia following the EU's Council Decision of 07.11.2000.
The EIB, established in 1958 by the Treaty of Rome, finances capital investment projects which further the European Union (EU) policy objectives. It also participates in the implementation of the EU's co-operation policy towards third countries. In South-East Europe, the EIB operates under the Mandate for Central and Eastern Europe agreed by the Council of Ministers for 2000 to 2007, which provides for EIB lending of up to EUR 8.7 billion, which complements the EU, as well as EU Member States' own bilateral co-operation policies. To underline its commitment to future post-war reconstruction in the Balkan area, the EIB played an active role in the preparation phase of the reconstruction investment programme, in cooperation with the European Commission and the other multilateral financing institutions. The list of potential infrastructure projects which was published in the Study on Basic Infrastructure Investment in South-Eastern Europe comprises a total of 85 projects totalling EUR 4 billion. Of this total, 35 projects are Quick-Start totalling EUR 1.1 billion, in which the EIB has a lead role in 14, totalling EUR 720 million, i.e. 65% of the total. 50 projects are "Near-Start", totalling some EUR 3 billion, of which EIB has a lead role in 18, amounting to some EUR 1 billion, i.e. 33% of the total Near-Start package.
The EIB in Croatia has been mainly supporting the rehabilitation of road infrastructure, and modernisation of the Croatian railway sections of Pan-European corridor Vc, linking Croatia to Hungary and Bosnia Herzegovina, as well as the private sector.
(1) EUR 1= USD 0.915800
(2) Global loans are available to partner lending institutions, which then on-lend the EIB funds in smaller portions according to the EIB's financing criteria. The funds are targeted primarily towards SMEs in tourism, industry and related services as well as environmental-protection and energy-saving investment schemes, and small to medium -sized infrastructure investments of Local Authorities. The global loans combine the EIB's first rate access to world capital markets, where it raises most of the funds for its lending activity, with the local network and know-how of domestic partner banks.