The European Investment Fund has signed a guarantee agreement with Bank of Valletta, allowing the bank to provide over €50 million of new loans to Maltese small and medium-sized enterprises (SMEs), including micro-businesses.

The agreement brings a new instrument, the First Loss Portfolio Guarantee (“FLPG”) to the Maltese market.

This instrument offers a new opportunity to a broad range of SMEs across Malta (including Gozo) looking to invest or expand their business. Bank of Valletta will offer improved loan conditions to businesses by reducing collateral requirements and reducing interest rates.

The guarantee is implemented under the Jeremie (Joint European Resources for Micro to Medium Enterprises) initiative, financed from EU Structural Funds.

Jeremie (Joint European Resources for Micro to Medium Enterprises) is a joint initiative launched by the European Commission (DG Regional Policy) and the European Investment Bank group to improve access to finance for SMEs in the EU within the Structural Funds framework for the period 2007-2013. Jeremie enables the EU member states and regions to put money from the structural funds and also national resources into holding funds that can finance SMEs in a flexible and innovative way. The initiative aims at developing and fostering the role of entrepreneurship within the EU in order to help structural funds to deliver greater benefits to the market.

To date, the EIF has signed eight national and three regional holding fund agreements.

In Malta, the Jeremie Holding Fund is financed from the EU Structural Funds under 2007-2013 Operational Programme – Investing in Competitiveness for a Better Quality of Life” and managed by the EIF.