German KfW signed contract for credit line worth 75m EUR with 5 banks in Serbia – funds intended for cities, municipalities and Serbian economy sector

German Development Bank KfW has signed the contract today (January 27, 2009) with five banks in Serbia for allotment of credit line worth 75m EUR for financing of public utility infratructure and energy efficiency.

Local self-governments and small and mid-sized enterprises will be able to apply for the loans with the annual interest rate of up to 6%, while maximum repayment period amounts to seven years.

The Government of Germany provided 30m EUR for cities and municipalities that want to modernize nursery schools, schools and hospitals, and the loans for that purpose will be approved through Banca Intesa.

Remaining 45m EUR are intended for energy efficiency projects and renewable energy sources, which enable energy saving. These loans will be approved through Čačanska banka, Raiffeisen Bank, Volksbank and ProCredit Leasing.

The contract on KfW’s credit line was signed in the premises of NBS in the presence of the Governor of the National Bank of Serbia, Radovan Jelašić, who said that the loan of the Government of Germany would introduce numerous benefits because the users of the loan would be able to get the funds, under most favorable terms, to finance their energy saving and environment protection projects at the time of financial crisis.

President of the Executive Board of Banca Intesa, Draginja Đurić, explained that the maximum value of the projects that would be financed from the credit line of KfW would be 2.5m EUR, 800,000 EUR of which would be KfW’s funds, while the rest would be provided by the bank.