14.11.2023 The Commission extends to BDB a EUR 125 m guarantee

The Bulgarian Development Bank and the European Commission have signed an agreement for an EUR 125 million EU Guarantee. The guarantee is extended under the Member State Compartment of the InvestEU Programme and will unlock financing amounting to over BGN 2.5 billion through lending by commercial banks to small and medium-sized businesses in Bulgaria, as well as for sustainable investments by companies and households.

The BDB will support the competitiveness of small and medium-sized enterprises by providing support for innovation, digitalization, green transition, and growth and strengthening of the activities of the SMEs.

Thanks to the EU guarantee, improved conditions can be offered where most needed in the market, e.g. lower collateral requirements, longer tenor and better price conditions.

The participation of the BDB in the InvestEU Programme will enable the launch of new products for the bank for sustainable infrastructure that will support the transition to a circular and resource-efficient economy, waste and resource management, the reduction of air pollution and sustainable water management

In July 2023, the BDB successfully completed an audit process which made it possible to entrust the BDB with the implementation of Union funds or budgetary guarantees and to become an InvestEU Implementing Partner. A call for expression of interest for the selection of financial intermediaries is expected to be launched in the market in early 2024.

The InvestEU programme will be implemented for the period 2021-2027 as the EU's main instrument for investments in the economic recovery, sustainable development and employment in Europe. It is aimed at supporting growth after the COVID crisis and achieving the goals of building a green, digital and sustainable European economy. The InvestEU Fund is deployed through Implementing partners that sign guarantee agreements with the Commission. With the signature of the guarantee agreement BDB has also become an InvestEU implementing partner. This will help the bank increase the number of partner financial intermediaries, so as to reach out to final recipients in priority areas for the EU and the national economy.

The InvestEU Member State Compartment offers the possibility for Member States to contribute resources to the programme. With the adoption of the Partnership Agreement in July 2022, Bulgaria allocated a contribution of EUR 100m from the European Regional Development Fund and of EUR 25m from the Cohesion Funds.