Hansa Capital has received 30 million euros in credit from the European Bank for Reconstruction and Development to help small and medium-sized businesses lease vehicles and equipment.
Small and medium-sized businesses make up 98 percent of the Baltic states' market activity and Hansa Capital line of credit is expected to help some of them get around problems securing medium-term financing, which according to the EBRD is hindering business growth, particularly in rural regions.
Hansa Capital is a part of the Hansabank Group and is the largest leasing company in the Baltic states.
Tarmo Rooterman, risk management director at Hansa Capi-tal, said all Hansa Capital branches in Latvia, Estonia and Lithua-nia will provide the leasing service. "The focus will be on the companies based outside the capital," he said.
"We expect most of the applications to come from companies based in the regions, especially from the transport and small industrial enterprises."
Agricultural companies are likely to get their aid from SAPARD, and we do not anticipate them filing many applications, he added.
Details of the leasing agreement will depend upon the client, but in general the credit line will fund leases from 10,000 euros to 50,000 euros.
In the last three years, Hansabank Group has received a total of 125 million euros in credit aimed at small and medium-sized businesses.
The credit, with a maturity of five years, is provided under the Small and Medium-sized Enter-prise Finance Facility funded by the EBRD and the European Commission.
Hansa Capital will also receive up to 5.6 million euros from the commission's Phare program for administrative costs and to compensate for the added risk of financing small and medium-sized businesses.
The SME Finance Facility was launched in 1999 under the Phare program to provide businesses with access to loans, leasing and equity financing from local financial intermediaries in the EU accession countries.
The EBRD has committed 485 million euros under the program, of which approximately 400 million euros have been disbursed in 15,000 loans.
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