The European Bank for Reconstruction and Development (EBRD) has signed a €20 mln trade finance facility with Eurobank Cyprus under the EBRD’s Trade Facilitation Programme (TFP) aiming at supporting the expansion of international trade on the island.
Through the facility, the EBRD will issue guarantees in favour of international commercial banks covering the political and commercial payment risk of the transactions undertaken by Eurobank.
In addition, Eurobank Cyprus will also benefit from the EBRD’s technical cooperation projects in trade finance.
The agreement was signed by the head of the EBRD’s Cyprus office Libor Krkoska and Eurobank Cyprus CEO Michalis Louis on the sidelines of the EBRD’s first TFP Information Session in Cyprus, held in Limassol.
In his speech, Krkoska noted that “this is our first ever trade finance facility in Cyprus. This alone makes it an historic event, as it shows our new Mediterranean countries taking a more active role in the demand of TFP product”.
Lucyna Stanczak-Wuczynska, EBRD Director, Financial Institutions, added that “the EBRD will aim to contribute to boost intra-regional trade and will contribute to the development of trade links between Cyprus and other countries where we invest. Extending trade is an important way of strengthening the local economy by creating opportunities for growth and the EBRD would like to be more engaged in working with Cypriot banks”.
Eurobank’s Michalis Louis said that “this facility will enable and assist our clients operationally and in a cost- efficient manner to promote their export/import businesses. At the same time, it is a vote of confidence for the Cyprus economy and our bank”.
The TFP Information Session focused on “Financing Foreign Trade with Cyprus” and attracted 100 representatives from issuing and confirming banks under the programme, the International Chamber of Commerce, Vienna, the World Trade Organisation, as well as key trade finance professionals, regulators and economists.
The main topics of discussion were the latest trends and developments of trade finance in the region including factoring and supply-chain finance.
After the event, the EBRD’s Cyprus office head Libor Krkoska said that the bank will do its best to minimise the impact of the Greek crisis on the Cyprus economy and that the EBRD is monitoring the situation in Greece very carefully.
"We are also monitoring what is happening here in Cyprus and so far it seems that the Greek crisis has little impact on Cyprus," he noted.
He also noted that "we will do our best to support the stability of both the financial sector and local companies so that the impact on the Cypriot economy will be minimal."
