HBOR’s New Credit Instrument Boasts 400 Million EUR of Potential – sat

Lauren Simmonds

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May the 6th, 2023 – HBOR’s new credit instrument boasts an impressive 400 million euros of potential, and large Croatian companies will now finally have a guarantee scheme offered to them by this particular body.

As Poslovni Dnevnik/Suzana Varosanec writes, after a decade and a half of questions and comments being fired back and forth on this particular issue, HBOR, supported by the operational decision of the Croatian Government, is finally going to start offering a proper guarantee scheme for large domestic companies as well.

As part of the sixth instrument implemented by the NPOO, HBOR has launched an attractive financial product on the market – “a credit guarantee as a way out” for investment projects of large companies in situations where there is a lack of own collateral, either due to the inability to access the necessary loans or owing to a lack of free assets.

For this purpose, nearly 80 million euros were allocated to HBOR from the NPOO, which, for the private sector at least, also comes as a trigger for investment projects with the aforementioned obstacles, but also for the public sector because this will greatly relieve the burden felt by local budgets. Large entities will definitely want to use the new HBOR credit instrument, as the total guarantee potential of this new financial product stands at around 400 million euros.

Beneficiaries of the new HBOR guarantee can be commercial banks and leasing companies, and HBOR itself when acting as a creditor. With the new product, this institution will become a development bank in the full sense of the word for large domestic companies, and it will also involve taking on new risks in the name of and indeed on behalf of the Republic of Croatia as a nation.

The product became operational with the Croatian Government’s decision to appoint a commission that will “nominate” consent givers for guarantees, so that their role becomes crucial in encouraging investments for the purpose of launching, modernising and digitising business as we go forward.

A maximum of 30% of such new HBOR loans can be used for working capital, and the maximum guarantee coverage is up to 80% of the loan principal for investments in special areas of the Republic of Croatia, the green and digital transition, research, development and innovation, while for other investments, coverage is up to 70% of the loan principal.

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