2024-03-12 00:22:09
In the 25 years since its establishment, the BBR has supported 27,333 enterprises and granted financing for BGN 7.4 billion.
A team of 27 people and BGN 11.6 million – this is how BBR – the only state-owned bank at the moment – was launched on March 11, 1999. The main shareholder then was the Ministry of Finance, and DSK Bank participated with 0.001%. 25 years later, BBR can boast of support for 27,333 enterprises and allocated BGN 7.4 billion as direct financing.
But let’s go back to the beginning as a Promotional Bank whose main objective is to support small and medium-sized enterprises and export-oriented companies. This is done through an individual package of five investment lending programs. The first loans granted by the bank were for “Rousse Construction Company”, “Moreni Tour – Vitosha National Park” and “Ferdinand Pandurski” medical clinic, and the profit at the end of the first year was BGN 83 thousand.
A year after the start, it also appears
the first international partner – The European one investment Bank
In the following years, Promotion Bank started cooperation with the European Investment Fund and the Development Bank of the Council of Europe.
In 2007, Bulgaria entered the EU and the time came for the state bank to start encouraging companies to develop. Thus, in April 2008, the parliament adopted a special law reorganizing the financial institution as the Bulgarian Development Bank, and its capital was increased by BGN 50 million.
The idea is to become an equal partner of the European development banks that exist in almost all EU countries. The new banking institution has a much larger portfolio of instruments. It provides pre-export direct and indirect lending to Bulgarian micro, small and medium enterprises. It also provides long-term investment lending directly or through commercial banks, risk capital financing aimed at enterprises in good financial condition, but not with a dominant market presence.
The warranty activity in
support of the launch and development on the company
With the BBR Law comes the first subsidiary of the bank – the National Guarantee Fund. It started with 10 million BGN capital, which in the first months of its establishment was increased by 67 million BGN.
Micro, small and medium enterprises benefit from its activity, whose loans are guaranteed up to 50% of the risk.
Again in 2008, in order to mitigate the negative effects of the world crisis on the Bulgarian economy, the government began to gradually capitalize BBR with BGN 500 million. This is part of the “Market flexibility” measures, as the money is for targeted refinancing of commercial banks and facilitating of business access to finance.
17 commercial banks have expressed interest in receiving a credit line from BBR up to EUR 10 million.
In 2010, the state bank established its second subsidiary – the Microfinance Institution “Jobs”. It should continue the activities of the JOBS Program, which expired at the end of 2009.
The program was launched in 2000 as a joint project of the Social and Economic Ministry and the United Nations Development Programme.
The aim is the creation of work places
by providing financial and non-financial services and trainings to support start-ups, micro- and small entrepreneurs. A network of 42 business centers was built throughout the country, mainly in rural areas.
The creation of an institution for financing start-up micro- and small enterprises at the BDB enables the accumulated funds under the program in the amount of about 6 million dollars to be used long-term on a revolving basis.
The microfinance institution “Jobs” started with four leasing schemes. The company grants up to 25,000 euros in the form of financial leasing for machinery, equipment, means of transport, agricultural machinery and inventory.
At the end of 2011, BBR also launched the first national guarantee scheme. This is the first step of the project to create a guarantee fund, which, within its full capacity, had the opportunity to take over guarantees for bank loans for over BGN 1.5 billion granted to beneficiaries in rural areas of the country.
An important role there is a BBR
and in the first stage of the renovation of housing in Bulgaria, providing BGN 1 billion in financing in 2015. Financial assistance is provided to the owners of private residential buildings with no less than 36 apartments built in an industrial way. The aim is to help reduce household energy costs as well as extend the life cycle of buildings.
In 2019, BBR created three new subsidiaries – the Capital Investment Fund, BBR Leasing and BBR Factoring (the latter no longer exists). Together with the National Guarantee Fund and the Microfinance Institution “Jobs” (today “BBR Microfinance” – note ed.) the BBR Group was formed. From that moment on, the financial institution has the full set of tools needed to comprehensively fill market gaps in the financial sector in Bulgaria.
In 2020, for the second time since its establishment, the BBR is
loaded with a key anti-crisis role in the country
This time because of the global COVID-19 pandemic. The bank is mandated by the government to develop measures to deal with the emergency situation and the negative consequences on the economy, as well as to create two on-lending programs to support businesses and people.
One is aimed at small and medium-sized companies with a total budget of BGN 500 million, and the second – at individuals, with a capacity of BGN 200 million. As with the previous capitalization of the bank, the funds are provided by the Bulgarian state. 12 commercial banks become partners of BBR under the two programs for the exit of the society from the unexpectedly difficult situation. With them, BBR supported businesses with BGN 630.3 million, and individuals deprived of the opportunity to work during the pandemic with BGN 255 million.
In 2023, the bank is the first and only institution in our country to receive approval from the European Commission as an implementing partner under the InvestEU program. That means it will
may manages budgetary means of European union
in accordance with all requirements of financial regulations. Thanks to this accreditation, BBR can create new products with high added value. The focus is permanently shifting towards supporting innovation, digitalisation, green and sustainable transformation. In the same year, it received a state guarantee and contracted loans totaling BGN 700 million from two key banks – the European Investment Bank and the Development Bank of the Council of Europe.
They aim to improve access to financing, promote employment and accelerate the ecological transition of small and medium-sized enterprises in the country.
The bank is behind the success of a $1 billion company
BBR is behind the success of a company that now has a market valuation of over $1 billion. This is Smart Energy – one of the leading European companies in the field of renewable energy. It owns photovoltaic plants in Bulgaria, Turkey, Greece, Romania and Ukraine, as well as offices in these countries plus Switzerland, Germany, Italy and the Netherlands.
The owner is Halil Demirdag, who is also the president of the Turkish Solar Industry Association (GENSED). “In 2009, the topic of green energy had just appeared in Bulgaria. Banks and investors still did not have enough knowledge and experience with investments in photovoltaic plants”, says Demirdag, who has Bulgarian roots.
“The Bulgarian Development Bank had clearly stated its attitude towards green energy and the achievement of the goals of Bulgaria and Europe. The bank shared with us that it is ready to consider the project and support it. After introducing the banking experts to our plans, we were most pleased by the fact that, at a time when solar energy was not widely known, we met a highly qualified technical team and a government bank that understood the matter, as befits a development bank.” adds the Turkish entrepreneur.
The project is one of the first large ones of a total of 20 MW capacities built in Bulgaria in 2011. Subsequently, the production of electrical energy from the park proved that the trust that the bank gave to the company was fully justified.
The situation has changed and it is no longer difficult to discuss the financing of a photovoltaic park of 100 MW. Today we have over 1 GW plants built, but the first one will always have a special place in our hearts, says Demirdag.