Entrepreneurs across the Slovak Republic will gain better access to finance following a €10mn loan from the EBRD to L’udovA Banka, the ninth largest bank in the country and a subsidiary of Österreichische Volksbanken AG. In addition to the EBRD loan, up to almost €1.5mn is being provided by the European Union for technical assistance and financial incentives.
These amounts are extended under the EU/EBRD SME Finance Facility, a joint programme of the European Commission and the EBRD to support the development and growth of entrepreneurs by facilitating their access to finance launched in 1999. The bank has committed €700mn, of which €637mn has been disbursed by local banks and leasing companies via 26,974 loans and leases. The EC has committed €130mn in grant financing and for technical assistance since the facility’s launch in 1999.
The proceeds of the loan will be used by L’udovA Banka to finance SME clients. Noreen Doyle, first vice-president at the EBRD, says: “This loan is important for Slovakia’s enterprise sector, since financing for entrepreneurs is currently limited. It is important that owners of small businesses have access to capital, because these SMEs are the engines of growth that promote economic development in any country. We hope that this project will demonstrate to other banks the excellent opportunities that exist in this growing sector.
Established in 1991, L’udovA Banka is a medium-sized commercial bank providing a wide range of banking services to local enterprises and individuals. With its headquarters in Bratislava, and 39 branches in the main cities throughout the country, L’udovA
Announcing the launch of the loan fund, Jozef KollAr, CEO of L’udovA Banka, says, “This loan from the EBRD, and the technical assistance provided by Bank of Ireland International Advisory Services, will support L’udovA Banka to serve the finance requirements of small and medium clients. The priority for L’udovA Banka is to provide continuing support to its SME clients to help them grow their businesses. Access to the EU/EBRD SME Finance Facility will support this strategy significantly.”
The SME Facility was launched in 1999 under the European Commission’s Phare Programme, the main channel for the EU’s financial and technical cooperation with the candidate countries of central and eastern Europe. The budget earmarked for the programme as a whole is about €
1.5bn a year. For further information visit: <http://europa.eu.int/comm/enlargement/> .