The European Investment Fund (EIF) and Swedbank Lithuania signed an agreement under which Swedbank will provide loans worth €104m (over LTL 359m) to Small and medium sized enterprises (SMEs) in Lithuania.
Swedbank will manage the newly created Funded Risk Sharing product under the JEREMIE initiative, designed to stimulate lending from banks to SMEs over a defined two year period.
The EIF will provide €52m to Swedbank, which will be matched by an equal amount from the Bank, therefore totalling €104m.
As stated by Richard Pelly, Chief Executive of the European Investment Fund, the Funded Risk Sharing instrument has been designed for businesses in response to the credit crisis.
“The EIF is managing this product in several Member States for the benefit of local businesses and Lithuania was the first country to benefit from it”, he said.
The EIF, which has already signed the contracts with Siauliu bankas and SEB bankas, is also implementing a number of other financial engineering instruments using the Holding Fund Structure in Lithuania.