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National Guarantee Fund (BDB) -Guarantee

Bulgaria | Financial Institutions

Identification Code:: OP/20/0047
Total Operation Cost:: 60.000.000 EUR
Maturity:: 60 months
Operation Status:: BSTDB Approved Amount – Approval Date

22.500.000 EUR – 22 Apr 2021
: BSTDB Signed Amount – Signed Date

22.500.000 EUR – 06 Dec 2021
: Status:
Active
Description and Purpose of the Operation:: Participation of the Bank in the Unfunded Risk-sharing Portfolio Guarantee Program in cooperation with the National Guarantee Fund. The Program targeting selected Financial Intermediaries (FIs) will facilitate access to finance for the SMEs giving BSTDB the opportunity to provide additional support to the financial sector in Bulgaria. The guarantees issued under the Program will be supplementing the collateral required by the FIs for loans granted to SMEs thus improving financing conditions. The Program will allow the FIs to expand their SME lending in particular in this critical time for the economy.
Countries of Operation:: Bulgaria (100,00%)
Financial Product:: Guarantees
Sector:: Financial Institutions
Domain:: Public
Borrower/Client:: SME Beneficiaries
Co-Financers/Participants:: Selected Financial Intermediaries (commercial banks) in Bulgaria
Guarantors/Sponsors:: BSTDB (Co-guarantor) / National Guarantee Fund AD (Lead Guarantor)
Developmental and Regional Cooperation Impact:: The operation involves BSTDB’s participation in a joint risk-sharing portfolio guarantee program with the National Guarantee Fund (NGF), part of Bulgarian Development Bank Group. With the potential to be classified as innovative, the Program will target selected financial intermediaries and will facilitate access to finance for the SMEs giving BSTDB the opportunity to provide diversified support to the financial sector in Bulgaria. Medium Term Strategy and Business Plan prioritizes increased cooperation with the public sector entities and supports provision of off-balance sheet instruments such as guarantees - including unfunded risk participations- especially where these improve external mobilization of financing for clients. Given the ample liquidity available to the financial sector in Bulgaria, the unfunded portfolio guarantees to commercial banks is a viable and practical alternative to support the economic activity and offset the negative impact of Covid-19 pandemic as well as increase BSTDB’s presence and value added in Bulgaria.
Environmental Classification and Impact:: The operation involves a joint risk-sharing portfolio guarantee program of BSTDB with the National Guarantee Fund for SME loans extended by eligible Bulgarian Financial Intermediaries. The selection of the FIs will be based on expression of interest. BSTDB will perform its own due diligence process on them. For the purpose of this Joint Guarantee Program it is suggested for NGF and the selected Financial Intermediaries to apply BSTDB’s E&S requirements outlined in its E&S Policy as well as the Exclusion List.
Operation Leader:: Financial Institutions II
E-mail:: fi2@bstdb.org