Cyprus: EIB agrees EUR 150 million of new support for companies through local banks

The European Investment Bank (EIB) today agreed new loans totalling EUR 150 million that will support crucial investment by local small, medium and midcap sized companies. The loans will be managed by four banks in Cyprus and help to bolster liquidity, support economic recovery and create new jobs.

“The European Investment Bank is firmly committed to supporting the Cypriot economy. We have demonstrated this engagement throughout the crisis and again today with significant new support agreed with local banks,” said European Investment Bank Vice President Jonathan Taylor.

“The European Investment Bank, Europe’s long-term lending institution, has been a key and reliable partner for Cyprus over recent years, providing long-term financial support for crucial infrastructure, as well as backing investment in the knowledge economy and innovation. The EIB will remain active and is committed to supporting economic growth and helping local firms invest and create new jobs. Across Europe, including here in Cyprus, small businesses are the backbone of the economy,” Jonathan Taylor added.

The EIB today agreed a new EUR 100 million loan with the Bank of Cyprus to support investment by local SMEs and MidCaps. This is second EIB loan that follows a EUR 50 million EIB loan with Bank of Cyprus signed in September 2014 and brings the total of loans approved with the Bank of Cyprus to EUR 150 million.

The EIB also signed today three loans with local Cypriot banks, raising the total number of active counterparts from seven to ten. This will further enhance competition in the banking sector and benefit local companies. The new loans to support local companies include EUR 15 million with Cyprus Development Bank, EUR 20 million with RCB Bank and EUR 15 million with USB Bank.

The loans include dedicated lending under the “Jobs for Youth” programme, which offers even more favourable financial terms to eligible SMEs. The Jobs for Youth lending initiative, launched by the EIB in July 2013, is part of a wider European commitment to tackle youth unemployment requested by the European Council in June 2013. The scheme targets countries with high unemployment amongst young people. In order to benefit from financing under the “Jobs for Youth” window, SMEs in the fields of industry, commercial services and tourism need to fulfil a limited number of conditions, including the employment or training of young people.

“The new EIB loans signed today will support private sector investment crucial for boosting economic growth and creating quality new jobs,” added Jonathan Taylor.

The four finance agreements totalling EUR 150 million were signed in Nicosia today in a public ceremony. Alongside EIB Vice President Jonathan Taylor, Cyprus Minister of Finance Harris Georgiades, Bank of Cyprus Director of Consumer Banking & SME Charis Pouangare, Cyprus Development Bank CEO Kyriakos Papadopoulos, RCB Bank CEO Kirill Zimarin and USB Bank CEO Andreas Theodorides were also present.