The EIF and Bank Polska Kasa Opieki SA (Pekao), have signed two guarantee agreements under the Competitiveness and Innovation Framework Programme (CIP) helping to provide enhanced access to finance for businesses in Poland.

Micro and medium sized enterprises in Poland will now have access to up to EUR 300 million (PLN 1.2bn) of additional funding guaranteed under the CIP which will help to support new entrepreneurs and create new jobs.

Commenting on the two transactions EIF Chief Executive, Mr Pelly said “We are pleased to be working with Pekao in providing access to finance at more favourable conditions to entrepreneurs in Poland.

Pekao’s innovative approach to financing existing SMEs and to ensuring early access to finance to start-ups in Poland will help to support businesses and contribute to the growth of the Polish economy.”

Under the first guarantee agreement, reduced collateral will be required from existing SMEs wishing to invest and develop their business. Under the second one, the bank will for the first time grant loans to start-ups without substantial business history.

Alicja Kornasiewicz, the CEO of Bank Pekao S.A. said: “Our bank will enable micro- and small businesses to take out loans with a value of PLN 1.2bn. Thanks to EU guarantees, we relaxed some requirements, e.g. relating to borrower’s contribution, amount of loans, tenor or collateral for loan repayment.

What we will require the customer to do will be just to sign the loan agreement, without additional bureaucratic burdens connected with public aid. We hope that up to 25,000 businesses will to make use of these facilities”.

About CIP:

The Competitiveness and Innovation Framework Programme (CIP), which spans from 2007 to 2013, has been put in place to boost European productivity, innovation capacity and sustainable growth, whilst simultaneously addressing complementary environmental concerns.

Within the framework of the CIP, the European Investment Fund (EIF) has been allocated EUR 1.1bn to be split between venture capital – with the High Growth and Innovative SME Facility (GIF) - and guarantees – with the SME Guarantee Facility (SMEG).

Under the SMEG, financial institutions are encouraged to enhance access to finance for SMEs. The facility offers an excellent tool to allocate additional financing volumes for those SMEs that would not otherwise have access to resources and financial engineering instruments because of the increased lending risk entailed. As such, The SMEG complements and broadens EIF’s own product offering.

The EU CIP SMEG Facility gives the EIF the opportunity to play an essential role in supporting sustainable job creation and entrepreneurship in European SMEs.

About the EIF

The EIF central mission is to support Europe’s SMEs by helping them to access finance. EIF designs and develops venture capital and guarantees 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 Pekao

Bank Pekao SA has been operating for over 80 years and is now one of the largest banks in CEE. It has the second largest network of branches (over 1 000 outlets all over the country) and offers to its clients a network of more than 4000 in Poland and 20 000 in Europe free of charge ATM’s. It provides service to ca. 5 million clients.

Bank Pekao SA has won four Euromoney Awards as Best Bank in Poland (in 2005, 2008, 2009 and 2010) as well as Best Bank in Poland awards in 2006, 2009 and 2010 by Global Finance and was also three times named as the Bank of the Year in Poland by The Banker magazine in 2009, 2008 and 2004.

Bank Pekao SA belongs to UniCredit Group - a major international financial institution with strong roots in 22 European countries as well as representative offices in 27 other markets, approximately 9,800 branches and more than 165,000 employees at 31 December 2009.

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For further information, please contact David Yormesor, d.yormesor@eif.org