45 million for SMEs in Bulgaria, Czech Republic, Poland and Romania

The EBRD, together with the European Commission, will provide €54.75 million to subsidiaries of Austria's Raiffeisen Zentralbank Oesterreich AG (RZB) in Bulgaria, Czech Republic, Poland and Romania to support small and medium-sized enterprises. This builds on €138 million in existing EBRD finance to RZB banks in Bosnia and Herzegovina, Croatia, Russia, Ukraine, and Yugoslavia to provide loans, mortgages, leasing and long-term financing to SMEs. The EBRD will also make an additional €20 million subordinated loan to Raiffeisen Bank Polska to enable the bank to expand its operations in Poland.

The latest agreements include four EBRD credit lines totalling €45 million - €15 million to Romania’s Banca Agricola-Raiffeisen, €10 million each to Raiffeisenbank Bulgaria and Raiffeisenbank a.s, (Czech Republic), and a €10 million equivalent multicurrency facility (euro and Polish zloty) to Raiffeisen Bank Polska. The EC will provide €9.75 million for financial incentives and technical assistance. These amounts are part of the EU/EBRD SME Facility, a programme of the EC in cooperation with the EBRD to facilitate access to finance for SMEs and to promote their growth.

Noreen Doyle, First Vice President at the EBRD, said working with banks like RZB helps to fuel the growth of the real economy through the continuing development of the SME market. With banks spread across the region, and a firm commitment to promoting growth in this sector, RZB is a natural partner for the EBRD, Ms Doyle added. "Employing more than 11,000 local staff, RZB plays a similar role to the EBRD in strengthening local economies."

Raiffeisen is the largest financier of SMEs in Austria. Herbert Stepic, Deputy Chairman of RZB, said Raiffeisen is committed to further strengthening its eastern European subsidiaries to help support the continuing development of this sector. “SMEs are the backbone of any economy driven by local entrepreneurs, and that is why they are essential for economic growth,” Mr Stepic added.

The SME Facility was launched on April 1999 under the Phare Programme of the European Commission, with the EBRD, to encourage the growth and development of SMEs by facilitating their access to loans, leasing and equity finance from local financial intermediaries in the candidate countries. To date the EBRD has committed around €333 million to 23 banks in 10 EU Accession countries; around 6,000 enterprises, employing some 70,000 persons, have benefited from financing under the programme.

The Phare Programme is currently the main channel for the European Union's financial and technical cooperation with the candidate countries of Central and Eastern Europe. The budget earmarked for the Phare Programme as a whole is about €1.5 billion a year.