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Bulgarian Development Bank: Empowering SMEs for Global Growth

Learn how the Bulgarian Development Bank supports small and medium enterprises in Bulgaria to drive regional economic development, exports, and innovation. Access flexible financing options for new ventures and existing businesses.

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Bulgarian Development Bank: Empowering SMEs for Global Growth

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  1. About the Bank • State-owned financial institution, 99.9%-owned by the Bulgarian state • Main objective: to support small and medium-sized enterprisesin Bulgaria • History: established in 1999 as Encouragement Bank • Credit rating: “BBB-”Fitch rating, in the top four ratings amongst Bulgarian Banks • International partners: the best-positioned local bank to raise funds from international financial partners • Subsidiaries: • National Guarantee Fund, established in 2008 • Microfinance Institution "JOBS"” – specialized in micro crediting

  2. How do we stand out? • Stability: the only state-owned bank in the domestic market • Direct and On-landing financing: the only Bulgarian Bank, which provides financing through other commercial banks • Easy access to financial resources: access to international financial institutions specializing in providing services to SME development lines. • Focus on small and medium business: pursuant to the BDB Act.

  3. What are our goals? • To help accelerating the regional economic development • To create a favorable environment for business development in our country • To support production companies in the real economy • To encourage and promote Bulgarian companies exports, innovations and competitiveness

  4. Priority areas of funding • Sectors, creating added value and new jobs • Production sector and economics structure forming sectors • Exports • Start-ups • Innovations

  5. Why do we encourage the export? • It is a key driver of the Bulgarian economy and forms an essential part of the gross domestic product. • The rapid export growth demonstrates the significant potential of the sector. In the first quarter of 2015 real export growth of 15.1% is reported which is comparable with the change of the indicator in 2010 – 2011. • The sales on the external market require better competitiveness. The export growth in the country is mainly due to the gradual increase of the production capacity in the processing industry and some service sectors. • Our major trading partners are the EU countries (Germany, Italy, Romania, Greece, France and Belgium); however, we would like to expand the scope of the Bulgarian export and to encourage the exporters to search for new markets. • For this reason Bulgarian Development Bank created in partnership with the Bulgarian Export Insurance Agency two loan products specifically aimed at the exporters - pre-export and post-export financing.

  6. Pre-export financing • Working capital for: • The full cycle of export financing prior to shipment and sale of export goods • Issuance of bid bonds, advance payment bonds, etc.. • Loan amount: : EUR 5 million • Interest rate: • 3.5% per annum for loans guaranteed by an insurance policy issued by the Bulgarian Export Insurance Agency (BAEZ) • 6.0% per annum, if no BAEZ insurance • Term: up to24 months • Collaterals: • Bank credit insurance from BAEZ • Pledge of business concern • Property mortgage • Pledge of machines and equipment • Bank guarantees

  7. Post-export financing • Financing of: international importers and their banks • Loan amount: • Up to100% of the export contract amount with a repayment term of up to 2 years • Up to85% of the export contract amount with a repayment term of over 2 years but not more than 5 years • Interest rate: • 3,5% per annum for loans guaranteed by an insurance policy issued by the Bulgarian Export Insurance Agency (BAEZ) • 6,0% per annum if no BAEZ insurance • Collaterals: • Bank credit insurance from BAEZ; bank guarantees; pledge of trade receivable. • Repayment term: • Consumer goods with sell-by date within 1 year, up to 1 year • Consumer goods with sell-by date beyond 1 year, up to 2 years

  8. Application requirements Selection criteria of candidates for funding: • To have a viable business idea • To have a good credit history • Not to have tax and social insurance obligations • To provide funds for their own participation in the investment (when investment loans are involved) • To provide collateral that is acceptable for bank

  9. Contacts BULGARIAN DEVELOPMENT BANK 10 Stefan Karadzha Str. Sofia 1000 Tel.: +359 2 9 306 333 Fax: +359 2 9 306 321 e-mail: office@bdbank.bg www.bdbank.bg

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