The Fund of Funds (FoF) signed contracts with the two selected financial intermediaries – UniCredit Bulbank AD and the Sustainable Cities Fund Consortium – for the implementation of the financial instrument "Portfolio Guarantee with Loss Cap for Circular Economy".
The Sustainable Cities Fund will manage public resources amounting to nearly €80 million, and UniCredit Bulbank AD – €82.5 million. The financial instrument to be implemented as a portfolio guarantee with the option of combining it with grant assistance within a single operation.
The funds are provided under the Competitiveness and Innovation in Enterprises Program 2021-2027, co-financed by the European Union through the European Regional Development Fund.
The official signing ceremony was attended by Krasimir Yakimov, Deputy Minister of Innovation and Growth, Iliana Ilieva, Director General of the Directorate General "European Funds for Competitiveness", Executive Directors Alexander Georgiev, Alexander Nenkov, Biser Petkov and experts from the Fund of Funds. Signatories on behalf of the Consortium for Sustainable Cities Fund were Christophe de Meul, Chief Executive Officer of UBB and Country Manager of KBC Group in Bulgaria, Frank Jansen, Executive Director of UBB, Nadia Dankinova, CEO of FLAG Fund, Viktor Yotsov, CEO of the Fund for Sustainable Urban Development, and Stoyan Stavrev, manager of the Bulgarian Consulting Organization. On behalf of UniCredit Bulbank AD, the agreement was signed by Ms. Tsvetanka Mincheva, CEO and Chair of the Management Board, and Mr. Borislav Bangeev, Chief Corporate Banking Officer and Member of the Management Board. Representatives of both selected intermediaries also attended the event.
The circular economy product is one of the most important FIs of the FoF for the new Programming Period. It aims to accelerate the transition to resource-efficient, low-carbon, and sustainable production by offering financing on favorable terms and the possibility of combining it with a grant
The FoF will provide the portfolio guarantee to intermediaries and will partially cover the risk of loss in the amount of 80% of the loan to the final recipients. The selected intermediaries should provide resources (form a credit portfolio) of over €500 million, which will be used to finance SMEs and large enterprises on favorable terms for investments aimed at achieving energy efficiency and introducing circular production models.
Over 80% of the resources are directed towards the less developed regions of the country in order to achieve greater territorial balance and stimulate sustainable investment outside the capital.
"With the signing of these agreements, we are moving from planning to the actual implementation of one of the most important instruments for green transition in the Bulgarian economy. Through the partnership between the state, the Fund of Funds, and financial institutions, we are providing businesses with access to sustainable and predictable financing that will help them modernize and be competitive in an increasingly green economy," said Krasimir Yakimov, Deputy Minister of Innovation and Growth, during the event.
The Fund of Funds continues to fulfill its mission of bringing together public and private resources to promote innovation and sustainable development in Bulgaria.
The "Portfolio Guarantee with a Loss Cap for the Circular Economy" is a key instrument for achieving a green, more efficient, and competitive economy in line with EU objectives and national priorities.
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