THE COUNCIL OF MINISTERS APPROVES AMENDMENT TO THE PORTFOLIO GUARANTEE PROGRAM IN SUPPORT OF CORPORATE LIQUIDITY

The newly adopted Decision of the Council of Ministers introduces changes to the Recovery Program, aiming to synchronize it with the upgrading mechanism for intervention developed in May 2021 by the Ministry of Economy and the Ministry of Finance, which provides liquid support to enterprises - "Portfolio guarantee to overcome the consequences of COVID-1.9" ("Recovery Program").

The "recovery program" will provide significant liquidity support to companies in the country, concentrated in a relatively short period. The guarantee scheme will ensure the accessible provision of financing to numerous enterprises on favourable terms, which will broadly cover the increased counterparty risk associated with the consequences of COVID-19. The guarantee focuses on reliefs in the collateral requirements and the shortest possible terms for approval and disbursement of loans. Commercial banks will be required to transfer the full economic benefits of the guarantee to the final borrowers by providing unsecured loans, except for personal contracts, which the beneficial owners must provide. In addition, the changes in the Program will enable the shorter processing terms and optimized time for approval or disapproval of the loans.

The decision gives consent to the Bulgarian Development Bank EAD to reallocate part of the funds within the approved budget under the Program for other measures for tackling the consequences of COVID-19, assigned for implementation by the Council of Ministers of the Bulgarian Development Bank EAD.

The draft decision will contribute to the effective implementation of the programs assigned to BDB AD to overcome the negative consequences of the COVID-19 pandemic.