Hellenic Bank Public Company Ltd

Funding of Cypriot companies in collaboration with the European Investment Bank

Within the framework of its policy to support Cypriot enterprises, Hellenic Bank Public Company Ltd (“Hellenic Bank”) established in its favour a credit by the European Investment Bank (“EIB”) initially in the amount of €35,000,000 (thirty five million euros) and subsequently a further €15.000.000 (fifteen million euros) and €50,000,000 (fifty million euros).  This credit along with an amount of €66,700,000 (sixty six million seven hundred thousand euros) from Hellenic Bank’s own funds (total amount of €166,700,000) has been/ will be allocated for the financing of eligible investment projects located in Cyprus in the sectors of industry, tourism and other services to be undertaken by Cypriot SMEs and Mid-Caps (“the Beneficiaries”).

 


Funding of Cypriot companies in collaboration with the European Investment Bank

Eligibility criteria

 

A. Beneficiaries

 

Beneficiaries are small and medium-sized enterprises (SMEs), with less than 250 employees (full-time equivalent) and medium-capitalisation Companies (MidCaps), with minimum 250 and less than 3000 employees (full-time equivalent), based in Cyprus and the project for which they are funded is also located in Cyprus.

 

Beneficiaries active in any sector are eligible except the following non-exclusive activities:

  • Activities targeting the production of weapons and ammunition, arms, military or police equipment or infrastructures, and equipment or infrastructure which result in limiting people’s individual rights and freedom (i.e. prisons, detention centres of any form) or in violation of human rights;
  • Activities targeting the production or facilitating the use of gambling and related equipment;
  • Activities targeting tobacco manufacturing, processing, or specialist tobacco distribution, and activities facilitating the use of tobacco (e.g. “smoking halls”);
  • Activities involving live animals for experimental and scientific purposes insofar as compliance with the "Council of Europe’s Convention for the Protection of Vertebrate Animals used for Experimental and other Scientific Purposes" cannot be guaranteed;
  • Activities which give rise to environmental impacts that are not largely mitigated and/or compensated;
  • Activities considered ethically or morally controversial or which are forbidden by national law, e.g. research on human cloning;
  • The purchase of goodwill; the purchase of intangible assets that could lead to or enforce a strong market position of the Final Beneficiary (i.e. a market share of more than 20% of the relevant market);  the purchase of licenses or rights for mineral resource exploitation;
  • Activities constituting pure real estate development activity;
  • Activities constituting pure financial transactions (such as the purchase of shares, or any other financial product).

In addition to the above, financial holding companies and leasing companies are non-eligible.

 

B. Investment categories


Investments and expenditures which could be considered for financing as part of the Sub-Project include:

  • The purchase, renovation or extension of tangible assets other than land;[1]
  • The purchase of patents and licences is eligible where they are necessary for the technical implementation of the Sub-Project;
  • Investment in intangible assets, i.e.:
    • Development, planning and financing costs during the construction phase of a tangible asset;
    • R&D expenses (fees, development costs and gross salaries directly associated with the research, development, and innovation components of the activity);
    • Building up of distribution networks in domestic or other markets inside the European Union (asset and/or trademark acquisition, operational costs and labour costs).
  • Generation change (i.e. retirement of the previous owner) or staff-related enterprise transmission, allowing for a continuation in economic activity of the respective enterprise.  The scope of the financing is however limited to those cases where both buyer and the entity to be sold are eligible enterprises, and the total financing need for the operation does not exceed EUR 5,000,000 (excluding own funds).  The acquisition of enterprises in other contexts than in the one described in this paragraph is not eligible for EIB financing.

Additionally, funds from this scheme may be used to support financing needs arising from the operational activities of the Beneficiaries. Within this context, working capital loans of at least two years may be provided to the beneficiary.

 

Advantages of EIB funding

The Beneficiaries of the approved loans will be granted a financial advantage in relation to the interest rate of the loan. This financial advantage will be at least 1,00% (one hundred basis points) per annum, compared to the rate Hellenic Bank would charge for the same loan without the participation of the EIB. In addition, if a Beneficiary participates in the EIB’s "Jobs for Youth” initiative (as described below), then that Beneficiary is granted an additional 0.50% (fifty basis points), raising the financial advantage to 1.50% (one hundred and fifty basis points).

 

“Jobs for Youth” initiative

Part of the total amount of €166,700,000 will be used for supporting the Beneficiaries which promote youth employment, in the context of the EIB’s "Jobs for Youth" initiative.

 

In order to qualify for this initiative, a Final Beneficiary needs to fulfil at least one of the following three criteria:

 

  1. The Final Beneficiary confirms to have hired in the last 6 months and still employ at least 1 young person (5 for Midcap enterprises) (or plans to hire at least one young person (at least 5 for Midcap enterprises) in the coming 6 months), calculated from the signature date of the loan agreement signed with Hellenic Bank, or
  2. The Final Beneficiary offers vocational training to young persons, or internships/training programmes for young people, or
  3. The Final Beneficiary has an active cooperation agreement with a technical college or school or university to employ young persons (e.g. during summer internships).

 

A "young person" is defined as a person of more than 15 and less than 27 years of age at the time when he/she benefits from the relevant event (employment, training or internship).

 

For the Final Beneficiaries complying with one of the above criteria, Hellenic Bank will ask the Final Beneficiary to sign the "Jobs for Youth Eligibility Confirmation"

 

Notes:
The above information has been prepared by Hellenic Bank Public Company Ltd for information purposes only. The information contained in this page is in a summary form and has been obtained or compiled from sources provided by EIB but its accuracy, completeness or correctness cannot be guaranteed and may be subject to change. Hellenic Bank Public Company Ltd shall not be liable whatsoever for any direct or consequential loss arising from any use of this information.

 

[1] The financing of land purchase is excluded unless it is technically essential for the investments.  Financing of purchase of farmland is entirely excluded.

 

For further and complete information, please contact Hellenic Bank’s Business and Corporate Centres.

 

Telephone Numbers of Business Centre

 

Nicosia Athalassas Ave. Business Centre Τηλ.: 22 501811
  Athalassas Ave. Business Centre Τηλ.: 22 501881
Limassol Gladstonos & Foti Kolakides Business Centre   Τηλ.: 25 502123
  Gladstonos & Foti Kolakides Business Centre Τηλ.: 25 502181
Larnaca Larnaca Business Centre Τηλ.: 24 503102
Ammochostos Paralimni Business Centre Τηλ.: 23 504335
Paphos Paphos Business Centre Τηλ.: 26 505170

Telephone Numbers of Corporate Centres
 

Nicosia - Larnaca - Famagusta Corporate Centre    Tel.: 22 501892
Limassol - Paphos Corporate Centre Tel.: 25 502398

 

Service Line 8000 9999





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