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”) of the amount of €140,000,000 (one hundred forty million euros). This credit 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”).

Final Beneficiaries
  • Final Beneficiaries
  • Investment Categories
  • Advantages of EIB Funding

Beneficiaries

Eligible Final Beneficiaries are small and medium sized enterprises (“SMEs”), defined as enterprises with less than 250 employees (full-time equivalent) or “MidCaps”, defined as enterprises with minimum 250 and less than 3000 employees (full-time equivalent).

An enterprise is any entity engaged in an economic activity, irrespective of its legal form, thus encompassing also family firms, partnerships, liberal professionals and associations regularly engaged in an economic activity.

Self-employed persons are eligible Final Beneficiaries if they are recorded in a business registry and bear a VAT number.

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

IRFMBusinessCustodian2.jpg

  • 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).

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.
 
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.

Tangible Assets

  1. The purchase, renovation or extension of tangible assets, including the development and planning during the construction phase
  2. Financing costs during the construction phase for up to 10% of the total Project cost
  3. Land purchase which is technically essential for the investments for up to 10% of total Project cost
  4. Purchase of assets other than real estate (e.g. construction equipment), with the purpose of renting them to third parties.

Intangible Assets

  1. RDI expenses (including gross salaries of staff directly associated with the Research, Development, and Innovation components of the firm’s activities, and development costs of concessions, patents, licenses, trademarks and similar rights and assets)
  2. Purchase of process licenses, software and other rights and assets with an inherent productive capacity
  3. Purchase of other intangible assets such as licenses for the use of non-generated public resources, patents, brands, trademarks and similar rights and assets up to 10% of the Project costs.

Working Capital

  • 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 0,50% (fifty 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 1.00% (one hundred basis points).

“Jobs for Youth” initiative

Part of the total amount 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 one young person (5 for MidCap enterprises), or in the coming 6 months it plans to employ at least one young person (5 for MidCap enterprises), calculated from the signature date of the loan agreement signed with Hellenic Bank and it commits to keep the young people in employment for at least 1 year, and/or
  2. In the last 6 months, it has provided a vocational training or internship position to at least one young person (5 for MidCap enterprises), or in the coming 6 months it plans to provide a vocational training or internship position to at least one young person (5 for MidCap enterprises), calculated from the signature date of the loan agreement. The training/internship has a duration of at least 3 months and is formalised by an active cooperation agreement with a technical school, university or public employment agency and/or is confirmed by a letter signed by one of these institutions and/or is part of the Final Beneficiary’s own formalised vocational training or internship programme, and/or
  3. In the last 6 months, it has participated in a youth entrepreneurship programme of a Non-Governmental Organisation or educational institution, or plans to participate in such programme in the coming 6 months.

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"

TILE3InternationalBankingStudentCard@2x.jpg.jpg