In the context of Russia’s war against Ukraine, €1.25 billion Hungarian loan and guarantee scheme has been approved by the European Commission. This scheme is establish to support small and medium enterprises (‘SMEs’) and large companies.
Hungary notified to the Commission, under the Temporary Crisis Framework, a €1.25 billion loan and guarantee scheme to provide liquidity support to SMEs as well as to large companies in the context of Russia’s war against Ukraine.
The aid will take the form of loans with subsidised interest rates and guarantees on loans granted by the Export-Import Bank Private Limited Company Eximbank (“Eximbank”). The measure will be open to companies active across sectors affected by the current geopolitical crisis, with the exception of financial institutions.
The Commission found that the Hungarian scheme is in line with the conditions set out in the Temporary Crisis Framework. In particular, when it comes to aid in the form of guarantees:
- the maturity of the guarantees cannot exceed six years
- the maximum coverage cannot exceed 90% of the underlying loan
- the guarantee premiums respect the minimum levels set out in the Temporary Crisis Framework
Finally, the loans and guarantees will be granted no later than 31 December 2022.
Source: State aid: Commission approves €1.25 billion Hungarian scheme to support companies in context of Russia’s war against Ukraine