SME deal for Mal­tese busi­nesses as EIF and Banif Bank sign new guar­an­tee agree­ment

Malta Independent - - BUSINESS & FINANCE -

The Euro­pean In­vest­ment Fund, part of the Euro­pean In­vest­ment Bank Group, and Banif Bank (Malta) have signed an agree­ment in­tended to sup­port SMEs in the pres­ence of Deputy Prime Min­is­ter Louis Grech and Par­lia­men­tary Sec­re­tary Dr Ian Borg. The guar­an­tee agree­ment signed will al­low Banif Bank to pro­vide around mil­lion of new loans to SMEs in Malta, un­til end 2019. This is one of the two SME Initiative trans­ac­tions signed in Malta, which in to­tal will gen­er­ate more than €65 mil­lion in loans, sup­port­ing over 800 Mal­tese com­pa­nies.

The agree­ment with Banif aims to fa­cil­i­tate ac­cess to fi­nance for Mal­tese 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 Malta is a joint fi­nan­cial in­stru­ment of the Euro­pean Com­mis­sion, the EIB Group and the Gov­ern­ment of Malta and aims to stim­u­late SME fi­nanc­ing by pro­vid­ing par­tial risk cover for SME loan port­fo­lios orig­i­nat­ing from­fi­nan­cial en­ti­ties. Along­side EU Struc­tural and In­vest­ment Funds (ESIF) re­sources con­tributed by the Gov­ern­ment of Malta, SME Initiative Malta is co-funded by the Euro­pean Union through Hori­zon 2020 re­sources as well as EIB Group re­sources.

Com­ment­ing on the trans­ac­tion, EIB Vice-Pres­i­dent Dario Scan­na­pieco said: “I am pleased to sup­port this sig­na­ture in Malta un­der the SME Initiative. In col­lab­o­ra­tion with Banif Bank, I am con­vinced that to­gether we will be able to reach out to many Mal­tese SMEs in need of fi­nance. This new agree­ment is the re­sult of an ex­cel­lent col­lab­o­ra­tion be­tween the EIB Group, Mal­tese au­thor­i­ties, EC and the banks.”

EIF Chief Ex­ec­u­tive Pier Luigi Gilib­ert added: “I am de­lighted to be in Malta today to sign this guar­an­tee agree­ment un­der the SME Initiative for Mal­tese busi­nesses. Banif Bank is a new fi­nan­cial part­ner for EIF in Malta and we are pleased to be work­ing with them to en­hance ac­cess to fi­nance for com­pa­nies as a re­sult of this agree­ment. 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.”

Joaquim F. Silva Pinto, Banif Bank Chief Ex­ec­u­tive Of­fi­cer said: “As an es­tab­lished core sys­temic bank, Banif will con­tinue to con­trib­ute sig­nif­i­cantly to the lo­cal econ­omy by of­fer­ing credit fa­cil­i­ties to business to sup­port the dif­fer­ent stages of their oper­a­tions – from set­ting up to their de­vel­op­ment and growth. Our new agree­ment and col­lab­o­ra­tion with EIF means we are in a strong po­si­tion, more than ever be­fore, to of­fer en­trepreneurs and busi­nesses loans re­quir­ing min­i­mal col­lat­eral and with ad­van­ta­geous rates. Our new prod­uct ‘Banif Business Ac­cel­er­ate’ will be do­ing just this. We would like to thank the Min­istry for Euro­pean Af­fairs and the Im­ple­men­ta­tion of the Elec­toral Man­i­festo for this op­por­tu­nity and for be­ing an ef­fec­tive cat­a­lyst for nur­tur­ing the con­tin­ual growth of Mal­tese busi­nesses.”

Elena Grech, Head of the EC Rep­re­sen­ta­tion in Malta noted: “The sig­na­ture of a sec­ond loan guar­an­tee agree­ment un­der the EU-funded SME Initiative is very good news for Mal­tese en­ter­prises and in­vestors. They will now have the choice of two fi­nan­cial in­sti­tu­tions, and can ap­ply for more in­vest­ment loans with the ben­e­fit of par­tial risk cov­er­age pro­vided for by the EU.”

Deputy Prime Min­is­ter Louis Grech, Min­is­ter for Euro­pean Af­fairs and the Im­ple­men­ta­tion of the Elec­toral Man­i­festo, said: “In line with the gov­ern­ment’s pol­icy of pro­mot­ing eco­nomic growth and wealth distri­bu­tion, 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, which com­ple­ments other ex­ist­ing fa­cil­i­ties in Malta, is yet another build­ing block that will con­tinue to con­trib­ute to the grow­ing im­pe­tus of eco­nomic progress that the Mal­tese econ­omy is ex­pe­ri­enc­ing. It also pro­vides a unique op­por­tu­nity for Euro­pean cit­i­zens to re­late to the Union and demon­strates the ben­e­fits of EU mem­ber­ship.”

Con­tin­u­ing on the same lines, Dr Ian Borg, Par­lia­men­tary Sec­re­tary for EU Funds and 2017 Pres­i­dency, ex­plained: “Malta is draw­ing on pos­i­tive ex­pe­ri­ences and im­prov­ing on other suc­cess­ful EU-funded in­stru­ments, and through the SME Initiative will pro­vide eas­ier and faster ac­cess to fi­nance needed by SMEs to con­tinue grow­ing. Ex­pe­ri­ence has shown that the business com­mu­nity has un­der­stood that fi­nan­cial in­stru­ments con­trib­ute to­wards im­prov­ing business pro­duc­tiv­ity while creat­ing a spill over ef­fect within the econ­omy. Thus, the im­ple­men­ta­tion of the SME Initiative through another Fi­nan­cial In­ter­me­di­ary, Banif Bank, au­gurs well to con­tinue as­sist­ing SMEs through bank loans at lower costs in or­der to en­hance their oper­a­tions and their in­vest­ment ca­pa­bil­i­ties.”

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