To benefit small, medium and mid-cap businesses located in Cohesion areas
Part of EIB’s immediate response to the COVID-19 pandemic
Supporting innovation and skills in the Czech Republic
The European Investment Bank (EIB) signed a €70 million loan (equivalent to CZK 1.8 billion) with MONETA, one of the largest retail and small business banks in the Czech Republic, to support SMEs and mid-cap companies. MONETA’s primary focus is consumer finance and SME lending, particularly in the agriculture sector.
The EIB loan aims to address the investment and liquidity constrains faced by small businesses and therefore contributes to the mitigation of the negative economic impact of the COVID-19 pandemic.
EIB Vice-President Lilyana Pavlovasaid: “Small businesses generate more than half of the total economic value added and two-thirds of the jobs in the Czech Republic. Supporting the continued development of SMEs and mid-caps during the COVID-19 crisis is therefore crucial to maintain employment and support the resilience of the Czech economy. Our loan to MONETA aims to address the financing needs of these essential economic actors and to create the necessary conditions for the future growth post-pandemic of the country. The cooperation between the EU Bank and MONETA will contribute to regional development, helping reduce regional disparities and towards increasing competitiveness and productivity of SMEs.”
Tomáš Spurný, MONETA chairman of the Board of Directors, said: “Our cooperation with EIB further enhances MONETA´s commitment to support small businesses. These form the backbone of Czech economy. We stand ready to continue in our aspiration to be the solid champion of this very important part of our economic landscape in these difficult times.”
SMEs and smaller mid-cap companies are highly exposed to the negative impact of the COVID-19 pandemic. Compared to large corporates, smaller companies usually have thinner liquidity reserves, less financing alternatives and assets that can be quickly divested as a source of additional capital. The impact of the pandemic across Europe, Czech Republic included, is associated with a tangible investment drop and increased liquidity needs.
MONETA is a leading independent Czech bank, servicing clients through its nationwide branch network and has been traded on the Prime Market of Prague Stock Exchange since 2016. The bank has focused on retail and SME oriented business model with a strong position in the consumer and agriculture segments. In addition, the bank provides customers with insurance products and investment funds. MONETA serves more than 13% of the Czech population via an omni-channel distribution strategy which includes 160 branches and 550 ATMs, a market-leading digital banking platform, a call centre, auto dealers, building society and mortgage bank, brokers and leasing partners.
MONETA Money Bank, a.s., the leading bank in Czech consumer finance with a growing SME lending offering, and the EIB acknowledged their partnership to support Czech SMEs. The EIB will provide MONETA Money Bank with a substantial credit line of EUR 150m with more than 80 million EUR already utilized in the pilot stage. The credit line will be utilised to finance projects and the growth of Czech SMEs through affordable credit and leasing facilities supporting SME clients in the fields of agriculture, manufacturing and transport.
Last year, the EIB Group, which consists of the EIB and the EIF, provided loans, guarantees and equity commitments worth €1.4 billion in the Czech Republic. The EIB Group maintained the high level of investment reached in 2019.
As part of a series of events organised to discuss current investment trends in different EU Member States, the Czech Banking Association and the European Investment Bank, in partnership with the Confederation of Industry of the Czech Republic and the Institute for Democracy & Economic Analysis (IDEA), hosted the webinar “Investment and investment finance in the Czech Republic”. It focused on investment needs and priorities for the Czech Republic in the era of COVID-19, digitalisation and climate change.