Release date: 29 September 2023
Promoter – Financial Intermediary
ALLIANZ BANK BULGARIA ADLocation
Description
The project concerns a guarantee for an existing portfolio of loans and leases to small and medium-sized enterprises and mid-caps by the EIB Group to support Allianz Bank Bulgaria's lending expansion in the small and medium-sized enterprises and mid-caps sector including focus on projects supporting green objectives.
Additionality and Impact
The project contributes to the Bank's lending priority objectives on SMEs, as well as on climate action (transversal). Through an intermediated approach, the Bank will reach SMEs and MidCaps financing small and mid-size projects, which could otherwise not be reached. In addition, the operation supports the financial intermediary's sustainability strategy, increasing its lending in the sector and diversifying its funding sources. The project addresses a number of market failures: From the continuously existing and further widening financing gap stemming from higher interest rates for SMEs, the gap in long tenor financing for Climate Action projects. The EIB's contribution is notable. It offers a guarantee for a subordinated (mezzanine) tranche, increasing the Intermediary's capacity to underwrite new loans. It's a novel product for the market (only 3rd such transaction in Bulgaria) and it is expected to achieve regulatory capital relief for the Intermediary. The EIB participation has a signalling effect to the market, highlighting the viability of the structure.
Objectives
The aim is to increase availability of finance for projects carried out by small and medium-sized enterprises and mid-caps operating in the industry, agriculture and services sector. The project contributes to the EIB's SMEs Lending priority and Climate Bank Roadmap, thereby also supporting EU policy objectives. The project has a 25% share of Climate Action and is eligible under Article 309 point (a) projects for developing less-developed regions and point (c) common interest."
Sector(s)
- Credit lines - Credit lines
Proposed EIB finance (Approximate amount)
EUR 40 million
Total cost (Approximate amount)
EUR 280 million
Environmental aspects
Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.
Procurement
Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.
Status
Signed - 4/12/2023
Disclaimer
Before financing approval by the Board of Directors, and before loan signature, projects are under appraisal and negotiation. The information and data provided on this page are therefore indicative.
They are provided for transparency purposes only and cannot be considered to represent official EIB policy (see also the Explanatory notes).