The FINANCIAL -- The EBRD is providing €50 million to Bulgaria’s ProCredit Bank to expand access to finance for small and medium-sized enterprises (SMEs).
SMEs constitute the backbone of Bulgaria’s economy and account for three-quarters of the country’s employment as well as two-thirds of its GDP. Recovering from the financial crisis, the sector is expected to grow again in the years ahead, serving as an important driver of Bulgaria’s economic growth. For this, access to credit is essential, according to the EBRD.
ProCredit Bank is a key provider of SME finance in the country and is seeing a growing demand for its products and services. The EBRD’s longer-term funds will enable the lender to better meet the needs of clients and at the same time expand its portfolio, including outside the capital, Sofia.
The EBRD and ProCredit have been partners for many years in the countries of south-eastern and eastern Europe, providing long-term funding for the development of small businesses and fostering private entrepreneurship. Earlier this year the EBRD acquired a 3.6 per cent stake in ProCredit Holding, the parent company of the development-oriented ProCredit group, which consists of commercial banks for small and medium-sized enterprises operating in many countries where the EBRD invests.
Announcing the new loan during a visit to Sofia, EBRD President Suma Chakrabarti said: “We expect the Bulgarian economy to continue growing in the coming years. This will require greater access to finance to help businesses grow locally and expand abroad. Fully dedicated to small and medium-sized businesses, ProCredit Bank has been our strong, longstanding partner in the region and we are pleased to strengthen our cooperation in Bulgaria.”
Rumyana Todorova, Executive Director of ProCredit Bank, said: “This is an encouraging signal to the small and medium-sized businesses in Bulgaria. The signing of today’s contract also reflects the shared principles and the joint commitment of both institutions to promoting growth and employment by supporting small and medium-sized enterprises.”
ProCredit Bank (Bulgaria) EAD was founded in October 2001 by an alliance of international development-oriented investors. Today, the bank’s sole owner is ProCredit Holding, based in Frankfurt am Main, Germany. ProCredit Holding is the parent company of ProCredit group, whose main operational focus is on south-eastern and eastern Europe. The primary mission of ProCredit Bank EAD is to support the development of SMEs and to foster a favourable environment for the growth of the Bulgarian economy.
The EBRD is a leading institutional investor in Bulgaria. It focuses on enhancing the private sector’s competitiveness, strengthening the financial sector and narrowing the infrastructure gap. To date the Bank has invested €3.7 billion in 248 investment projects in the country.