The EBRD is lending Société Générale Expressbank, a leading bank in Bulgaria, Lv19.6mn ( €10mn) for on-lending to local small and medium-sized enterprises (SMEs), with loans not exceeding €30,000 and €125,000 respectively.

The loan comes under the EU/EBRD SME Finance Facility and will be complemented by a grant of €1.58mn from the European Commission for technical assistance and financial incentives.

John Chomel-Doe, EBRD country director for Bulgaria, says the loan will address one of the key challenges facing the country ahead of EU-accession. A vibrant SME sector is a prerequisite for a strong economy. In order to grow, these companies need long-term funds, and the EBRD welcomes Société Générale Expressbank’s strategy to increase its focus on this sector.

Société Générale Expressbank is an active supporter of the local SME sector. In 2005, the bank’s SME portfolio increased by 53%, a figure Société Générale Expressbank hopes to build on using the EBRD loan.

The bank is growing rapidly, reaching more than 300,000 clients through its network of 108 branches, and 1000 employees across Bulgaria. Société Générale Expressbank is part of Société Générale Group, which is the fifth largest bank in the Euro zone, widely represented in Southeastern Europe with subsidiaries in Romania, Serbia and Montenegro, Slovenia, Croatia and Greece.

Philippe Lhotte, chairman and CEO of Société Générale Expressbank, says the bank is undertaking a strategy to develop further in the SME sector, offering local businesses a wide range of products and services that will help build new, or expand existing businesses. To achieve this objective, the partnership with the EBRD and the European Commission will be very valuable.

The EU/EBRD SME Finance Facility, a joint programme of the European Commission and the EBRD, supports the development and growth of entrepreneurs by facilitating their access to finance.

Under this regional project covering 11 countries, the bank is making available funding of €1.1bn, of which €975mn has been committed to signed projects to date. The EC has contributed €157mn in grant financing and technical assistance since the launch of the facility in 1999.

The EBRD is the largest foreign investor in Bulgaria, having committed nearly €1.3bn in 61 projects.