03/15/2023 | Press release | Distributed by Public on 03/16/2023 01:20
EIB Global, the arm of the European Investment Bank (EIB) for activities outside the European Union, has agreed to provide a credit line for €80 million to OTP banka Srbija and OTP Leasing Serbia, which the intermediaries will match with an equal amount of their own funds. The funds will be available on favourable terms to a wide range of small and medium enterprises (SMEs) and mid-caps from different sectors, to help them meet their financial needs and fund new investments amid the ongoing crisis. By improving access to long-term financing, the credit line will allow Serbian firms to innovate and grow while creating new job opportunities.
The financing arrangement is in line with the European Commission's Economic and Investment Plan for the Western Balkans, designed to foster sustainable development in the region with enhanced Team Europe support. It will boost competitiveness, contribute to private sector-led growth and help implement the forthcoming national strategies to develop SMEs.
Vice-President Lilyana Pavlova, responsible for EIB activities in Serbia, stated,"Let me express my appreciation for the enduring and fruitful partnerships with OTP Group, which have resulted in strong support for the private sector in the region. This investment will bolster economic activity and job creation significantly by alleviating the credit constraints SMEs are facing due to the compound effects of the energy, food and COVID-19 crises. The funds will help them meet their liquidity, employment and investment goals to more quickly adapt to a new, more digital and greener economic landscape. In this way, new investments will increase economic resilience and employment, while enabling the country to integrate further into global value chains."
The EIB has a longstanding and successful relationship with OTP Group Serbia, which has efficiently channelled EIB funding to serve SMEs and mid-caps over the last 15 years. Through joint operations, the banks have been able to support small businesses operating in fields spanning energy, environmental protection, industry, health, education, services, tourism and agriculture.
Predrag Mihajlovic, CEO and president of the Executive board of OTP banka Srbija, remarked, "Today we have signed the most extensive financing agreement so far when it comes to international financial institutions, and I am particularly pleased that the EIB will remain our long-term partner. Last year was the most successful in the history of OTP Group in Serbia. We have succeeded in achieving record results and double-digit growth in all business segments, further reinforcing our position as the largest corporate and retail creditor. Having said that, with this €80 million credit line doubled with our funds, I believe we can even more intensively provide much-needed financing to SMEs and mid-caps in Serbia and serve their financial and investment needs."
Branimir Spasić, CFO and member of the Executive board of OTP banka Srbija, added, "With our wide regional outreach and focus on SMEs and the corporate sector, OTP banka Srbija has the potential to provide financing to smaller businesses, SMEs and mid-caps under favourable lending conditions and to help foster the SME sector across the country. Most importantly, this credit line will allow us to enable companies to grow, innovate and employ more people."
To date, the EIB Group - consisting of the European Investment Bank and European Investment Fund - has unlocked close to €5.6 billion for SMEs in the Western Balkans, supporting their growth, recovery and transformation while safeguarding some 800 000 jobs.
About OTP banka Srbija
OTP banka Srbija is the number-one creditor on the Serbian market, in both the retail and the corporate segments. It holds a leading position in factoring, ecommerce and leasing services, with an extensive footprint of 155 branches in 91 cities and six regions across the country. In 2022, OTP banka Srbija was named best bank in Serbia by two prestigious magazines, Euromoney (Award for Excellence 2022) and The Banker. Global Finance named it Best Foreign Exchange Bank 2023, while Euromoney ranked it among its Euromoney Market Leaders in Serbia for corporate banking. OTP Leasing Serbia and OTP Osiguranje also operate within OTP Group in Serbia.
About EIB Global
EIB Global is the EIB Group's new specialised arm devoted to increasing the impact of international partnerships and development finance. EIB Global is designed to foster strong, focused partnerships within Team Europe, alongside fellow development finance institutions and civil society. EIB Global brings the EIB Group closer to local people, companies and institutions through our offices around the world.
About the EIB in Serbia
The EIB has been active in the territory of Serbia since 1977, providing finance to support key infrastructure projects, as well as SMEs, industry, services and local authorities. Since the start of its activities in the country, it has enabled over €7.2 billion of investments in SMEs and the revitalisation of transportation, education, healthcare and utility infrastructure.
About the EIB in the Western Balkans
The EIB is one of the leading international financiers in the Western Balkans. Since 2009, the Bank has financed projects totalling €10.3 billion in the region.