The European Investment Bank (EIB) lends EUR 30 million in support of projects in the area of services, including tourism, environmental protection and rational use of energy in Bulgaria.
The loan is being provided to HVB Bank Biochim, which will on-lend EIB funds to finance projects with total investment costs comprised between EUR 40 000 and EUR 25 million, usually implemented by small and medium enterprises and municipalities. The current loan is a continuation of the successful cooperation with HVB Bank Biochim, as it is the third loan granted by the EIB to this financial institution, the fourth largest bank in Bulgaria. This cooperation makes it possible to use HVB Bank Biochim's knowledge of the local market, with more than 130 branches, offices and outlets and over 400 thousand clients in Bulgaria, including entrepreneurs and municipalities, in order to improve their access to long term finances.
The part of the loan dedicated to support municipal projects is representing EUR 7.2 million. Under these loans Bulgarian municipalities also benefit from the Municipal Finance Facility. This scheme is subsidized by EU grants under Phare Programme. The grant support to municipalities can amount up to 5% of the total loan in order to promote municipal investments related mostly to the building, upgrading or refurbishing of small municipal infrastructure.
The task of the EIB, the European Union's financing institution, is to contribute to the integration, balanced development and economic and social cohesion of the Member States by financing sound investment. In the Acceding Countries (Bulgaria and Romania) the EIB supports investment projects that prepare for EU membership in terms of development of transport, energy and communication infrastructure, implementation of EU environmental standards, support to SME and municipality investments.
Since 1990 the EIB has provided in loans in Bulgaria approximately EUR 1.2 billion. Approximately 15% of this amount (EUR 180 million) represents loans supporting the development of entrepreneurial activities of SMEs and municipalities.