Croatian businesses to get financing boost as EIB Group provides €132 million backing to Erste Bank

• EIB Group offers €132 million in guarantees to Croatia-based Erste&Steiermärkische Bank d.d. to expand financing for range of businesses in the country
• Package includes guarantees of €100 million from EIB and €32 million from EIF
• Operation to bolster Croatian Mid-Caps, micro-entrepreneurs and social enterprises

The European Investment Bank (EIB) Group is providing Croatia-based Erste&Steiermärkische Bank d.d. (ESB) with €132 million in support to expand lending to a range of businesses in the country. The backing is in the form of a €100 million guarantee from the EIB and two portfolio guarantees totalling €32 million from the European Investment Fund (EIF).

ESB expects to use the EIB guarantee to generate as much as €280 million in new financing for Croatian Mid-Caps. The terms will include lower interest rates for loan recipients and higher risk-taking opportunities for ESB.

"Ensuring businesses of all sizes have access to financing is fundamental to driving economic growth and stability," said EIB Vice-President Teresa Czerwińska. "With this guarantee, we are reinforcing our commitment to supporting Croatian Mid-Caps, helping them seize new opportunities for expansion and innovation."

The EIF support totalling €32 million aims to bolster ESB lending to Croatian micro-entrepreneurs and social enterprises. It includes guarantees of €19.2 million for micro-entrepreneurs and €12.8 million for social enterprises including non-governmental organisations.

This part of the package expands EIF-ESB cooperation under the InvestEU programme to bolster financial inclusion, facilitate entrepreneurship and drive sustainable social impact across Croatia. The expanded framework is focused particularly on start-ups and first-time borrowers and allows for favourable loan terms including reduced collateral requirements.

"Access to finance remains one of the biggest challenges for start-ups and social enterprises," said EIF Chief Executive Marjut Falkstedt. "On the back of strong demand in the Croatian market, we are renewing our partnership with ESB, increasing financial opportunities for these organisations and ultimately enabling them to contribute to financial and social inclusion in Croatia."

The new EIF guarantee for micro-entrepreneurs will enable total ESB lending to them of as much as €24 million. The guarantee for social enterprises will pave the way for total ESB financing to them of up to €16 million.

“We are very pleased to continue and further deepen our long-standing successful cooperation with EIB Group. So far, in partnership with the EIB and EIF we have provided a total of €926 million in loans to our clients supported by the EIB funding and EIF guarantee instruments. Support for micro-entrepreneurs and social enterprises, as well as medium-sized enterprises, as important drivers of growth and economic development, is one of our key strategic pillars. With this package, we have additional financing instruments which will support client growth, contribute to job creation in our communities and result in realisation of numerous successful projects.” said Erste&Steiermärkische Bank d.d. Member of the Management Board, Mr Hannes Frotzbacher.

Background information

The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances investments that contribute to EU policy objectives. EIB projects bolster competitiveness, drive innovation, promote sustainable development, enhance social and territorial cohesion, and support a just and swift transition to climate neutrality.

The European Investment Fund (EIF) is part of the European Investment Bank Group. It supports Europe’s SMEs by improving their access to finance through a wide range of selected financial intermediaries, such as banks, guarantee and leasing companies, micro-credit providers and private equity funds. The EIF designs and offers equity and debt financing instruments fostering EU objectives in support of entrepreneurship, growth, innovation, research and development, the green and digital transitions, and employment.

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Erste & Steiermärkische Bank d.d. (ESB)  Erste&Steiermarkische Bank d.d. originates from the former strong regional banks – Riječka, Bjelovarska, Trgovačka and Čakovečka banka – and has been operating under this name since 1 August 2003. Today it is a modern bank, ranked No3 on the Croatian market by total assets, and a part of the international Erste Group, one of the leading financial service providers in CEE. What makes Erste Bank different is its employees, their approach to work, innovation, and care for the clients. The Bank has been posting great business results for years, continuously investing in digital development that facilitates innovation and creativity in customer service. By supporting the financial needs of the citizens and financing sound and profitable projects implemented by entrepreneurs and companies contributing to employment growth in the real sector, the Bank adequately supports the development of the entire economy.

The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery and growth. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. InvestEU brings together under one roof the multitude of EU financial instruments, making funding for investment projects in Europe simpler, more efficient and more flexible. The InvestEU Fund is implemented through financial partners that will invest in projects using EU budget guarantee of €26.2 billion. That guarantee will back investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.