The European Investment Fund, part of the European Investment Bank Group, and Banif Bank (Malta) have signed an agreement intended to support SMEs.
The guarantee agreement, signed in the presence of Deputy Prime Minister Louis Grech and Parliamentary Secretary Ian Borg, will allow Banif Bank to provide around €6 million of new loans to SMEs until the end 2019. This is one of the two SME Initiative Malta transactions, which in total will generate more than €65 million of loans, supporting over 800 companies.
The agreement aims to facilitate access to finance for SMEs by enabling the bank to lower the interest rates and reduce collateral requirements. This transaction is expected to benefit more than 60 SMEs and start-ups in need of finance.
SME Initiative is a joint financial instrument of the European Commission, the EIB Group and the Government and aims to stimulate SME financing by providing partial risk cover for SME loan portfolios originated by financial entities.
Alongside EU Structural and Investment Funds (ESIF) resources contributed by the Government, SME Initiative Malta is co-funded by the EU through Horizon 2020 resources as well as EIB Group resources.
EIB vice-president Dario Scannapieco said: “I am convinced that together we will be able to reach out to many Maltese SMEs in need of finance.”
EIF chief executive Pier Luigi Gilibert said: “The combination of European Structural and Investment Funds, EU Horizon 2020 and EIB Group resources enable EIF to support risk-sharing and provide capital relief to financial intermediaries for the benefit of SMEs.”
Banif Bank CEO Joaquim F. Silva Pinto said: “Our new agreement and collaboration with EIF means we are more than ever before in a strong position to offer entrepreneurs and businesses loans requiring minimal collateral and with advantageous rates.”
Deputy Prime Minister Louis Grech said: “I am pleased to welcome Banif Bank as yet another key local financial institution through which the SME Initiative will be implemented in Malta for the benefit of Maltese SMEs. This initiative is yet another building block that will continue to contribute to the growing impetus of economic progress that the Maltese economy is experiencing.”
Parliamentary Secretary for EU Funds Ian Borg said: “The SME Initiative will provide easier and faster access to finance needed by SMEs to continue growing. Through Banif Bank SMEs will benefit from loans at a lower cost in order to enhance their operations and their investment capabilities.”