Interest rates below 2 percent available to number of entrepreneurs

05 July 2019

In order to additionally facilitate access to finance for Croatian entrepreneurs, as of 1 May 2019 HBOR condensed its existing 25 loan programmes into 9 loan programmes that contain all current benefits and introduce some new ones.


Interest rates as low as 0.728 percent charged to farmers, processing industry entities and programmers

Market-competitive entrepreneurs engaged in activities of special interest – agriculture and fisheries, processing industry or computer programming – can fund their investments at an interest rate of 1.5 percent as of now with the possibility of additional reductions of 0.2 percentage points for youth employment and up to 0.572 percentage points for innovative entrepreneurs (according to InnovFin criteria), which means that the interest rate charged to these entrepreneurs can equal 0.728 percent. Under the Pre-Export Finance loan programme, the interest rate, which depends on the credit rating of entrepreneur and collateralisation, can be as low as 1.75 percent instead of the rate of 2 or 3 percent having been charged so far. The interest rate charged on working capital loans has been reduced from 4 percent to 3.5 percent for long-term loans and to 2 percent for short-term loans, whereas the public sector can borrow funds for investment finance at interest rates of 1.75 percent or 2 percent depending on the area of investment without a commitment fee charged.

“We are aware of the fact that it has been stressed in the media in the recent years that the interest rates charged for entrepreneurial development are too high and that competitors of our entrepreneurs can borrow funds at an interest rate below 2 percent in the EU. Amendments to the loan programmes we introduce today will result in interest rates below 2 percent being available to a large number of our entrepreneurs. This relates to HBOR’s loans and to financial instruments we implement.” pointed out Tamara Perko, President of HBOR’s Management Board. She stressed that HBOR’s focus in the coming period would be on the development of new products, such as venture capital funding.

As an additional support for successful achievement of the set goals, HBOR has launched a process of preparing its five-year strategy, for the funding of which a grant has been obtained from EU funds and which is planned to be completed by the end of this year.

New financial instruments, programmes for exporters and equity investment fund announced

The implementation of two new financial instruments has been announced: „Investment loans for rural development“ that will enable favourable lending for investments in agricultural production and „Energy efficiency loans for entrepreneurs“ that will enable favourable loans for projects of Croatian entrepreneurs from the manufacturing industry and service activities.

HBOR is involved in the establishment of an investment platform for the financing of projects of Smart cities and Smart islands, for which well prepared projects and technical assistance will be crucial. Technical assistance for projects in the field of energy efficiency and renewable energy resources will be provided from the ELENA facility. In other words, by using the ELENA facility, HBOR will provide grants in the total amount of EUR 2.1 million to cover the costs of advisory services and the preparation of project documents. It is expected that these funds will be available during 2020.

Beside the lowered interest rates, HBOR has announced the introduction of a new export credit insurance programme that will be intended to banks in order to facilitate access to financial means. The programme relates to the insurance of the loan portfolio for exporters’ working capital that commercial banks will be able to offer to their clients from this autumn onwards.

After ESIF Venture capital fund intended to start-up companies and investments in early stage of operations has become active in mid-2019, the selection of a company to manage the CROGIP (Croatian Growth Investment Programme) funds has been announced to take place at the end of the year. It is a joint initiative of the European Investment Fund and HBOR, which has launched a programme for promoting investments in the capital of small and medium-sized and mid-cap companies with up to 3,000 employees that are not start-ups.

2018 – 13 percent higher activity, 5 times more funds approved for financing of projects from the EU funds

In 2018, HBOR approved 13 percent more funds than in 2017 by supporting 2,650 projects with an amount of almost HRK 8.40 billion, whereas the amount of approved loans was by 9 percent higher than that in 2017. During 2018, HBOR approved 1,970 loans in the amount of HRK 5.61 billion, and in the same period previous year, HBOR approved 24 percent more funds for investments, and investment loans represented 86 percent of all approvals in 2018. During 2018, HBOR also approved almost HRK 860 million Kuna for projects financed out of the EU funds, which is a 5 times higher amount that that approved during 2017.

In the same period, Croatian exporters were supported with an amount of HRK 5.63 billion, i.e. an increase of 23 percent compared with the total amount approved in 2017. This result was significantly influenced by the value of the total insured export turnover in the amount of HRK 2.7 billion, i.e. an increase of 56 percent compared to the previous year. HBOR insured export turnover in 54 countries worldwide.

At the end of 2018, the assets of HBOR exceeded HRK 27 billion and its profit amounted to HRK 204.7 million.

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