HVB Bank to offer EU subsidised loans to SMEs

HVB Bank Hungary will offer subsidised loans to local small- and medium-sized enterprises (SMEs) under an agreement signed with the European Investment Bank (EIB) on Monday.

The agreement modifies a Ђ80m EIB Global Loan Agreement with HVB signed in December 2001, and allows up to Ђ20m of this facility to be used in SME financing deals.

The EIB will also provide a grant subsidy to HVB, based on a flat rate per transaction. Without subsidies, loans for SMEs can be prohibitively expensive, EU ambassador Jurgen Koppen said, because loan decisions for small amounts require nearly as much background work as large loans. Therefore, while HVB will receive the subsidy, it will actually benefit the SMEs by allowing them to access capital at affordable rates.

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