A range of smaller Baltic companies will be eligible for preferential loans totalling up to €138 million as a result of guarantees by the European Investment Fund (EIF) for Latvia-based Citadele Bank.
The EIF guarantees will enable Citadele Bank to direct the new financing to small and medium-sized enterprises (SMEs) as well as microbusinesses in Estonia, Latvia and Lithuania.
SMEs in the three Baltic countries will be eligible for loans from Citadele Bank, with a total amount of up to €100 million available.
Microbusinesses — defined as those with fewer than 10 employees — will have access to up to €38 million of the funding.
Microbusinesses play a vital role in the Baltic economies, accounting for 95% of all companies in Estonia, 93% of enterprises in Latvia and 95% in Lithuania.
Under the agreement with the EIF, Citadele Bank will have three years to build the loan portfolio, with a maximum individual financing amount of €1 million.
As part of the lending process, Citadele Bank will also provide advisory support to companies, helping them identify the most suitable borrowing arrangements.
“Beneficiaries will benefit from relatively low interest rates and from lower or no collateral and downpayment requirements,” said the EIF.
The EIF is part of the European Investment Bank (EIB) Group.
“Our support for Baltic businesses increases job security, facilitates new investments and strengthens the competitiveness of local companies in times of global economic uncertainty and international trade challenges,” said EIF Chief Executive Marjut Falkstedt.
“This is an excellent example of how European collaboration can unlock new investment opportunities for even the smallest of companies.”
Citadele Bank CEO Rūta Ežerskienė said: “Medium, small, and microbusinesses are crucial to the Baltic economy and identity.
“They often embody the soul of regional communities, create jobs, and inspire innovation, improving the economic situation.
“This program will make financing more accessible for young companies and new development plans, thereby contributing to overall economic growth in the Baltic countries.”