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Investment Plan for Europe: First EFSI deal in Hungary as EIF and K&H sign EUR 97 million deal to support over 1500 small businesses

    Date: 04 February 2016

The European Investment Fund (EIF) and K&H Bank have signed the first COSME agreement in Hungary, benefiting from the support of the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe.

The EU support will allow K&H Bank to provide HUF 30bn (ca. EUR 97m) to over 1,500 small businesses in Hungary. EIF will provide K&H Bank with a guarantee under the COSME programme with financial backing from the European Commission allowing the organisation to increase its lending volumes over the next 3 years, by providing loans to SMEs that would otherwise not have received financing.

EU Commissioner for Education, Culture, Youth and Sport, Tibor Navracsics, said: “Helping to boost economic growth by triggering new investment is the Commission’s top political priority. That is why I welcome today's announcement that K&H will provide fresh loans worth nearly €100 million to small businesses in Hungary with support from the EIF and the Investment Plan. I encourage Hungarian SMEs to contact K&H with their business proposals to make the most of the opportunities opened up by this new deal.”

Commenting on the signature, EIF Chief Executive, Pier Luigi Gilibert, said: “I am delighted to be signing the first EFSI SME guarantee agreement in Hungary under the COSME programme. Increasing access to finance is one of the fundamental driving forces for EFSI and this deal helps to achieve this aim. We are proud to partner with K&H Bank to target underserved SMEs which can contribute to creating jobs and growth in both Hungary and across Europe.”

Hendrik Scheerlinck, Chief Executive at K&H Bank, said: "K&H Bank is the first institution in Hungary to make the COSME European Union guarantee program available. The programme will grant 50% credit guarantee, free of charge to clients, in order to boost borrowing by micro-, small and middle size enterprises. The conclusion of this agreement proves that K&H can and wants to lend. The COSME guarantee programme will, in line with the Bank’s strategy, contribute to our goal of providing new financing to a larger number of business companies. Additionally, the EU guarantees will have a positive impact on K&H Bank’s capital adequacy too, allowing us to further increase our lending volumes.”

Dr. Ágnes Bába, Deputy Chief Executive at K&H, said: ”The COSME guarantee programme provides a 50% guarantee to SMEs free of charge for a maximum of 45 million forint per transaction. Long-term overdraft facilities, working capital loans, investments loans (including Phase III of the new Funding for Growth Scheme), bank guarantees and the K&H business support credit product to be introduced are all included in the scheme. Applying for a COSME guarantee, which is free of charge for clients, is managed in the credit assessment process currently applied by K&H, so it cuts both time and red tape for businesses. It would help in financing thousands of customers during the life of the programme if calculating based on the average SME loan size of HUF 15-20 million.”

This deal reflects the EIB Group’s commitment to respond swiftly to calls from Member States, the European Commission and the European Parliament for a rapid launch of concrete initiatives under EFSI, accelerating lending and guaranteeing transactions capable of boosting jobs and growth in the EU.

About the EIF

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 by helping them to access finance. EIF designs and develops both venture and growth capital, guarantees and microfinance instruments which specifically target this market segment.

About K&H Bank

K&H actively supports the growth of SMEs in Hungary. The fact that new loans in the amount of ca. 38 billion forints were disbursed by the bank to companies in the sector as of September 30, 2015, is a clear evidence. As a result, the SME credit portfolio of the bank has increased by 8% year-on-year, in contrast with the average 1,8% growth in the market. The continuously rising number of credited SME clients reached 9200 by the end of September, which means every 12th domestic SME has a loan disbursed by K&H. The Funding for Growth Scheme plays a major role and K&H continues to take a leading role, concluding credit agreement in the total amount of 190.3 billion forints in Phase II and 283.3 billion in the first and second phases of the program.

Hungarian SMEs can apply for financing at: please add product website address: https://www.kh.hu/publish/kh/hu/mikrovallalkozas.html


COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020 with a total budget of EUR 2.3 billion. At least 60% of the programme will be devoted to ease access to finance for SMEs in Europe, with two financial instruments. The COSME Loan Guarantee Facility supports guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance to SMEs. This facility also includes securitisation of SME debt finance portfolios. The COSME programme also invests through the COSME Equity Facility for Growth in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages. The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (CIP) (2007-2013) which helped to mobilise more than EUR 20 billion of loans and EUR 3 billion of venture capital to over 373,000 SMEs in Europe.

Businesses can contact selected financial institutions in their country to access EU financing: http://www.access2finance.eu/

Press contacts:

EIF: David Yormesor, Tel.: +352 42 66 88 346, e-mail: d.yormesor@eif.org

K&H Bank: Ms. Katalin Bánhegyi, Tel: +36 30 411 3890, e-mail: katalin.banhegyi@kh.hu

European Commission: Siobhán Millbright, Tel.:+ 32 229 57361, e-mail: Siobhan.millbright@ec.europa.eu


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