In July 2015, the Hungarian Eximbank signed a EUR 50 million loan facility agreement with the Council of Europe Development Bank (CEB) to further support the Hungarian micro, small and medium-sized (MSMEs) enterprises.
The lending activity of both Eximbank and the CEB focuses on fostering employment by providing medium to long-term financing to micro, small and medium sized-enterprises. The facility agreement is expected to finance MSMEs registered in Hungary through the Hungarian banking system. The CEB loan will provide financing for end-users’ working capital and investment needs of up to EUR 5 million.
The Council of Europe Development Bank was established in 1956 and it is Europe’s oldest multilateral development bank. The Bank’s lending activity focuses on strengthening social integration, managing the environment, supporting public infrastructure with a social vocation, and supporting micro, small and medium-sized enterprises.
EXIM has started in depth talks and negotiations with the Export Import Bank of China in June 2012, the largest export credit agency of the world. Since then, a number of joint agreements and cooperation frameworks have been concluded with China Eximbank. The most prominent deals are the (i) 100M EUR interbank framework agreement signed in February, 2013 with the facility fully drawn in November 2013, the credit line has been since extended to 200 M EUR; and the (ii) creation of the Chinese Central and Eastern European Investment Fund sponsored by China Eximbank. The Fund has a target size of USD 500 million, and Hungarian Eximbank will invest 30 million USD. The Fund will deliver a significant stimulus in form of equity investments into growth-focused and capital intensive enterprises
The European Investment Bank (EIB), the financing institution of the European Union, is owned by the Member States, who have all subscribed to the Bank’s capital. The EIB’s mission is to further the objectives of the European Union by providing long-term finance for specific projects of Member States, besides it is also financially active in partner and accession countries alike. Eximbank signed with EIB EUR 100 million and EUR 200 million refinancing loan agreements in 2013 and in 2014 respectively with the aim of promoting favorable financing conditions to Hungarian SMEs exporting to other EU markets. In 2017, the EIB and the Eximbank signed a new agreement in the amount of EUR 400 million to support the financing of the enterprises with fewer than 3.000 employees. The enterprises can access to the facilities with preferential EIB funding through Eximbank’s commercial bank partners as well. The agreement allows providing funds with fixed, low interest rates and long tenor for SMEs and MidCaps. The EIB funds can be used to finance both investments and current assets, with a tenor of at least 2 years. The loans can be allocated by Eximbank through two EIB credit lines:
Credit line (A) for SMEs and MidCaps: Financing of transactions up to EUR 25 million; the amount of the EIB allocation may reach 100% of the customer credit, but should not exceed EUR 12.5 million or equivalent in HUF.
Credit line (B) for MidCaps: financing of transaction with a cost of more than EUR 25 million but up to EUR 50 million; the EIB allocation should not exceed 50% of the cost of the transaction.
Eximbank has reached an advanced stage in talks with IFC, a member of the World Bank Group with regard to the establishment of a Trust Fund. The Trust Fund will help domestic SMSs to get increasingly involved in IFC financed projects. By structuring the Trust Fund with the active cooperation of the Hungarian Investment and Trade Agency, EXIM will play a pioneering role in the Central and Eastern European region.
Since 1991 EBRD has been using the tools of investment to help build market economy in Hungary. Within the framework of the Bank’s operations it draws up new country and sector-specific strategies from time to time with the scope of economic convergence. In Hungary the Bank primarily supports the recovery of the financial sector and provides long term financing to support investments in transport and traffic infrastructure and in the field of energy efficiency. EBRD has set the goal of strengthening and extending the position of Hungary as a hub of technology intensive and value-added production. Eximbank is in advanced talks about concluding a co-financed buyer’s credit scheme with EBRD.
Other international organizations