Hamag Bicro - Croatia 2014

LETTER OF INTENT FOR A GUARANTEE AND GUARANTEES FOR EQUITY Istanbul, Turkey

Goran Becker, M.Sc.

Croatian Agency for SMEs, Innovation and Investments Republic of Croatia

www.investcroatia.hr


Croatian Agency for SMEs, Innovation and Investments established by

the Government of the Republic of Croatia with the purpose of enhancing

SME development and promoting investment.

Independent institution under the supervision of the Ministry of

Entrepreneurship and Crafts.

Croatian Guarantee Agency – 1994

goal: supporting the establishment and development of entrepreneurship

in Croatia

Croatian Agency for SMEs – 2002

goal: supporting the development of SMEs and increasing their share in

the overall economy of Croatia

Croatian Agency for SMEs and Investments – 2012

goal: supporting entrepreneurs to enter investment projects that provide

economic development at the national level

Croatian Agency for SMEs, Innovations and Investments – 2014

goal: creating a unified system with the Business Innovation Croatian

Agency to support entrepreneurs in all the stages of their business

HISTORICAL DEVELOPMENT OF THE AGENCY


In its 20 years of existence, the Agency consistently promoted small business

and entrepreneurship in Croatia with significant results

Provided active support to Croatia’s economic development

Issuing guarantees for bank credits to SMEs

Promoting investments

Implementing grant schemes

Co-financing consultancy services

Issuing micro loans

Actively promoted Croatia as an attractive location for investment

Supported innovations and innovative projects

Structural Funds – New role

The Agency becomes a central place to support development of

entrepreneurship

MISSION AND GOALS


HAMAG-BICRO issues first call guarantees for SME loans

Cooperates with all business banks in Croatia

Issues guarantees using the network of business banks

Issues letters of intent for start-ups

Average guarantee is EUR 170,000

HAMAG-BICRO uses EIF counter-guarantees (successfully passed EIF due

diligence, including state aid compliance)

GUARANTEE MODEL


Guarantees are issued under de minimis or GBER rules

Maximum guarantee is 80% of credit principal

Maximum guarantee is EUR 2.5 mil GBER/ EUR 1.5 mil de minimis

Each entrepreneur is given a letter explaining which type of state aid is given

and in which amount

Cumulation is checked before issuing a guarantee

GBER guarantees are calculated in accordance with safe harbor premiums as a

sum of discounted state aid per year

GUARANTEE MODEL – STATE AID


Croatian start-ups are faced with great difficulties in accessing bank loans

They lack business experience and collateral

HAMAG BICRO decided to implement a different way of issuing guarantees

– ex ante approach

An SME first comes to HAMAG and its Business Plan is evaluated and a

letter of intent issued

This letter of intent is valid for 6 moths during which the SME tries to find a

willing bank

HAMAG issued 37 guarantees for start-ups in 2012 and 137 in 2013

GUARANTEE MODEL – LETTER OF INTENT


Equity guarantees are issued in order to enable risk sharing between a

business angel or venture capital fund and HAMAG-BICRO with regard to

equity investments made in target companies. they guarantee up to 50% of the invested amount

no collateral is needed to apply

An equity investment is considered to be an acquisition of regular and

preferred stocks, or shares of the target company

Target companies may exclusively be small and medium-sized enterprises

(SMEs), registered exclusively in the Republic of Croatia

EQUITY GUARANTEES INITIATIVE


The duration of an equity guarantee is from 2 years to 7 years

Equity guarantees cannot be activated in the first six months of issuing

Amount of an equity guarantee:

for business angels, up to EUR 80,000

for venture capital funds, up to EUR 600,000

EQUITY GUARANTEES INITIATIVE


Loan program, which started in 2013 as a pilot scheme

goal: to facilitate access to financing micro enterprises

intended for investment in fixed assets and working capital

amount per loan: max. EUR 15,740

2013

220 received / 32 approved loan requests

total value: EUR 270,000 (average 8,425 per loan)

result: 7 start-ups and 80 new jobs

2014 (open until 1.11.2014)

151 received / 21 approved loan requests (25.9.2014)

EUR 655,860 allocated

200 requests are expected, including 50 loans approved

MICRO LOANS – SUCCESS STORY


The Agency becomes a central place to support the development of

entrepreneurship

Within the framework of the Operational Programme in competitiveness

and cohesion for the financial period 2014-2020, Croatia has decided to

allocate 40% of the total ERDF to support small and medium-sized

enterprises, research and innovation and thus shown to be seriously oriented

towards competitiveness and long term growth

Ministry of Entrepreneurship and Crafts and the Croatian Agency for SMEs,

Innovations and Investments are the bodies responsible for the

implementation of all planned activities for which EUR 1,000,000,000.00

funds for the period 2014-2020 are foreseen

STRUCTURAL FUNDS – NEW ROLE


THANK YOU FOR YOUR ATTENTION !


[email protected]

Phone: +385 1 488 1000

Fax: +385 1 488 1009


Hamag Bicro - Croatia 2014

Economy & Finance

Transcript of Hamag Bicro - Croatia 2014