EIB loans Cyprus banks EUR228 mln for SMEs

The European Investment Bank signed a EUR228 mln loan agreement with Cypriot commercial banks on Friday, part of a broader strategy to boost liquidity to European small to medium size enterprises.
As part of the deal, EUR120 mln will go to the Bank of Cyprus, EUR50 mln to Marfin Laiki and EUR58 mln to Hellenic Bank. The Cypriot banks will also have to match the EUR 228 mln with their own funds available.
The islands business community say the funds will provide additional liquidity to Cypriot SMEs at better rates than are currently available in the Cypriot lending market.
Cyprus is currently preparing a legal framework to allow commercial banks access to cheap European Central Bank funding under its covered bond programme, something that is expected to be in place by next month.