BOV SME Invest 2019

May 16, 2019 | 3 minute read

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Bank of Valletta and the Malta Development Bank launch a new €50 million financing package for SMEs

More good news for SMEs!

On the 13th of May 2019, Bank of Valletta, together with the Malta Development Bank (MBD), has launched the ‘BOV SME Invest’. The aim is to attract SMEs that are planning new capital investment projects.

Supporting Malta’s entrepreneurial skills, innovation & employment.

What is ‘BOV SME Invest’?

The BOV SME Invest will provide more accessible financial support through reduced collateral requirements and finance costs.

An enterprise is able to pursue bank financing up to a maximum of €750,000, at attractive interest rates and reduced collateral obligations. The new financing package was launched during a press conference officiated by The Hon Dr Joseph Muscat.  

The event was addressed by BOV Chairman and the Bank’s Chief Credit Business Development Officer together with the Chairman of the Malta Development Bank.

How will the ‘BOV SME Invest’ program help SMEs?

The BOV SME Invest program grants €50 million financings to local SMEs through a ‘€10 million guarantee provided by the Malta Development Bank’ said the Bank’s Chief Credit Business Development Officer.

As an effect, this guarantees the Bank of Valletta to significantly reduce its collateral obligations coupled with a reduction in the interest rate of 2% below market rate.

The Bank’s Chief Credit Business Development Officer ‘SMEs face a myriad of challenges to launch their business, bring their projects to fruition and expand their horizons...BOV SME Invest eases the burden of seeking finance and complements other EU funded financial instruments such as the BOV JAIME scheme that is being well received by the market.’


‘BOV SME Invest’ In The Maltese Workforce

The BOV SME Invest program will continue to boost SMEs in Malta which Prof Bonnici said to attribute to ‘Malta’s economic success depends largely on the growth of SMEs. With SMEs accounting for around two-thirds of Malta’s workforce, this product will act as a catalyst to improve access to Bank financing for SMEs, spurring growth and innovation.’

The benefit of the guarantee will be passed on to the SME through a reduced level of collateral and a lower rate of interest.

The BOV SME Invest program is a result between Bank of Valletta and the Malta Development Bank. Together with the expertise and experience of both entities provide a solid foundation for SMEs.

Prof Bonnici commented that ‘This is the first financial instrument of its kind and is a clear manifestation of the MDB’s objective to complement the commercial banks and to work in partnership with the banks to crowd in new investment.  We are confident that SME Invest will act as a benchmark for similar programmes and initiatives in the future.’

Hon Dr Joseph Muscat concluded the launch by saying that 'BOV SME Invest provides a direct injection into Malta's economy and through the €10 million guaranteed by the Malta Development Bank, we are effectively creating €50 million of new business that will be injected into the Maltese economy that would result in a potential total investment of €90 million... This is in line with the MDBs aim of contributing towards sustainable economic development that benefits the Maltese community through economic growth and infrastructure development.'

"The decision to create the Malta Development Bank was taken over four years ago and this collaboration between Bank of Valletta, Malta's largest Bank, justifies the MDB's role and business model and bridges the credit market gaps existing in the SME market." continued Dr Muscat.

"The co-financing will stimulate more funding of infrastructural projects.'

 

For more information about this programme, contact Luke Cann Partner l Advisory Services here at Nexia BT.

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