The European Investment Bank (EIB) has provided a loan of EUR 100 million to MFB Magyar Fejlesztési Bank Zártkörűen Működő Részvénytársaság (MFB - Hungarian Development Bank) to finance small and medium-sized investments and infrastructure projects promoted by SMEs and public sector promoters in Hungary.
Mr László Baranyay, EIB Vice-President responsible for lending in Hungary, stated: “Improved availability of long-term financing, provided in cooperation with MFB, a well-established partner of the EIB, is crucial for further development of the SME sector, which forms the backbone of the Hungarian economy and the main driver of growth and employment in the country. Together with MFB, the EIB is ensuring that the benefits of granting loans on favourable terms are passed on to eligible final beneficiaries, be they SMEs or municipalities.”
This operation is based on the strong and effective partnership between the EIB and MFB. The EIB has already granted credits to MFB totalling some EUR 1 billion. These funds have supported projects of SMEs, midcap companies and public entities in the areas of industry and services, including tourism, and small and medium-scale infrastructure schemes promoted by local authorities.
EIB loans to banks finance smaller projects implemented by SMEs (with fewer than 250 employees) and midcap companies (with more than 250 and fewer than 3 000 employees) and local authorities. Since 1990, the EIB has provided almost EUR 4 billion, including the current loan, to support smaller projects in Hungary through the banking sector.
The EIB supports SME investments in Hungary in the framework of the Joint IFI Action Plan for Growth in Central and South Eastern Europe, which is focused on providing better access to long-term finance for Europe's SMEs to help mitigate the effects of the financial crisis. The EIB funds will support growth by enhancing long-term competiveness through increased availability of long-term credit.