The €5 million will help the bank boost local entrepreneurs' access to finance to launch or expand their businesses, helping to strengthen Serbia's private sector and fuel economic development. The facility aims to support this region in its transition to a market economy by strengthening the financial sector and by increasing SMEs' access to finance via local banks and leasing companies.
Dragica Pilipovic, director for Serbia and Montenegro at the EBRD, said Cacanska Banka, with its ambitions to strengthen its SME business, is a good EBRD partner. Both banks strongly support entrepreneurs, which are so crucial to economic development, said Pilipovic. By working with banks like Cacanska Banka, together we are helping to strengthen this sector in Serbia, she added.
The EBRD loan is being complemented with technical assistance funds from the European Agency for Reconstruction (EAR) to support staff training and to ensure successful implementation of the loan. Adriano Martins, head of the EAR's Belgrade office, said the agency's support for the SME sector has been strong and it will continue to be so for the foreseeable future.
Established in 1956, Cacanska Banka serves clients mostly in central Serbia, a region with a high concentration of SMEs and entrepreneurs. The bank has its headquarters in Cacak with 15 branches and offices in central Serbia and Belgrade.
Dragan Jovanovic, deputy general manager of Cacanska Banka, said expanding business with the SME sector is an important part of Cacanska's strategy.
The EBRD is a significant player in the economies of central and eastern Europe. Set up in 1991 to help nurture a new private sector within the former Soviet bloc, the EBRD is now the largest single investor in the region and mobilises significant foreign direct investment beyond its own financing.
In Croatia for example, retailer Getro is set to build nine new stores with the help of a similar €35 million EBRD loan.
The EBRD is owned by 60 countries and two intergovernmental institutions. But despite its public sector shareholders, it invests mainly in private enterprises, usually together with commercial partners.
The mandate of the EBRD stipulates that it must only work in countries that are committed to democratic principles. The EBRD says that it strongly supports cross-border economic activity within the region.