The European Investment Fund (EIF) and Raiffeisenbank (Bulgaria) EAD have signed an Amendment guarantee agreement under Cultural and Creative Sectors Guarantee Facility as a part of the EU's policy to overcome the economic crisis caused by COVID-19. Thanks to the scheme Raiffeisenbank will provide enhanced terms and conditions supporting Bulgarian small and medium-sized enterprises (SMEs) and small public enterprises in the cultural and creative sectors to overcome the consequences of the COVID-19 pandemic.

The guarantee agreement is backed by the European Commission’s Cultural and Creative Sectors Guarantee Facility, which is managed by the EIF. It also benefits from support from the European Fund for Strategic Investments (EFSI).

Under the agreement, SMEs will be able to access financing, backed by a 90% guarantee provided by the EIF on each new loan up to a maximum amount, per loan, of € 2 million by 30 June 2021. It complements the agreement signed between the EIF and Raiffeisenbank in the autumn 2020 to support the culture and creativity sectors. It focuses on overcoming the effects of the pandemic of one of the most affected sectors, by further improving access to financing.

In 2020 and early 2021, Raiffeisenbank negotiated agreements with international and national financial institutions for more than EUR 345 million. Of these, over EUR 300 million are aimed to support Bulgarian business in dealing with the effects of the pandemic, by providing it with a wide range of products under significantly easier financing conditions.

***

Background information:

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment.

About Raiffeisenbank: Raiffeisenbank (Bulgaria) was established in 1994 and is the first green-field investment in the Bulgarian banking sector. Raiffeisenbank is a fully consolidated subsidiary of Raiffeisen Bank International AG (RBI). RBI regards Austria, where it is a leading corporate and investment bank, as well as Central and Eastern Europe (CEE), as its home market. 13 markets in the region are covered by subsidiary banks. Around 46 000 employees service 16.7 million customers through 2 000 business outlets, the by far largest part thereof in CEE.

About the European Fund for Strategic Investments (EFSI): The European Fund for Strategic Investments (EFSI) is the main pillar of the Investment Plan for Europe. It provides first loss guarantees enabling the EIB to invest in more, often riskier projects. The projects and agreements approved for financing under EFSI are expected to mobilise €514 billion in investment, supporting over 1.4 million start-ups and SMEs across the European Union.

Cultural and Creative Sectors Guarantee Facility (CCS GF): The CCS GF benefits micro-businesses and SMEs in the cultural and creative sectors, which often face difficulties in accessing affordable debt financing for their projects. The EIF’s guarantee aims to change that. Loans supported by the European Union under CCS GF are now available for business in all the participating countries, which include the EU Member States, Iceland and Norway. The initiative is expected to create more than €600 million of new loans and other financial products for final beneficiaries through the guarantee’s catalytic effect. The guarantee facility encourages financial intermediaries to adopt a specific credit assessment approach with SMEs and organisations. They also have the opportunity to receive customised training to better understand the specific needs of the cultural and creative sector projects to increase their engagement in this area.
The guarantee agreement is backed by the European Commission’s Cultural and Creative Sectors Guarantee Facility, which is managed by the EIF. It also benefits from support from the European Fund for Strategic Investments (EFSI).
Under the agreement, SMEs will be able to access financing, backed by a 90% guarantee provided by the EIF on each new loan up to a maximum amount, per loan, of € 2 million by 30 June 2021. It complements the agreement signed between the EIF and Raiffeisenbank in the autumn 2020 to support the culture and creativity sectors. It focuses on overcoming the effects of the pandemic of one of the most affected sectors, by further improving access to financing.
In 2020 and early 2021, Raiffeisenbank negotiated agreements with international and national financial institutions for more than EUR 345 million.Of these, over EUR 300 million are aimed to support Bulgarian business in dealing with the effects of the pandemic, by providing it with a wide range of products under significantly easier financing conditions.