The FMFIB will provide portfolio guarantees to financial intermediaries to cover credit default losses from the designated target groups of final recipients. Most products designed by the FMFIB in that respect envisage guarantees that would cover up to 70-80% of losses incurred at the level of the individual credit facility but not more than 25% at the level of the loan portfolio (loss cap).
The purpose of guarantees is to provide an opportunity for target final recipients to use financing at more favourable pricing terms and/ or loan collateral requirements, tailored to their requirements and capacities.
Portfolio guarantees are envisaged in a number of Operational Programmes with which the FMFIB has signed financing agreements, namely:
- OPIC 2014-2020: Capped portfolio guarantees for innovation and energy efficiency for SMEs and large enterprises;
- OPHRD 2014-2020: Capped portfolio guarantees for micro-financing;
- OPE 2014-2020: Capped portfolio guarantees for waste management projects;
- OPRG 2014-2020: Capped portfolio guarantees for projects in urban development and regional tourism.