Loan (Private sector investment)

By-laws of HBOR
Decision on General Terms and Conditions of HBOR Lending Activities
HBOR Act

The ‘Private sector investment’ is one of the lending instruments of the Croatian Bank for Reconstruction and Development (HBOR, Hrvatska banka za obnovu i razvitak). It serves private sector business entities (companies, crafts businesses, sole traders, family farms (OPGs), cooperatives and institutions).

The purpose of the loan is, among others, the promotion of environmental protection, energy efficiency and renewable energy resources projects.

Other purposes include: investments in fixed assets (tangible and intangible assets) for the purpose of business modernisation, introduction of new technologies, increase in capacities, investments in research and development and introduction of new products or services, investments in tourist capacities and facilities as well as promotion of new employment.
Implementation of the loan is available directly through HBOR, or through commercial banks which are in cooperation with HBOR, or through a risk-sharing model of HBOR and commercial banks. Available choices for the manner of implementation depend on the type of the project.

Manner of Implementation

 • In cooperation with commercial banks (via commercial banks or through risk-sharing model) – application and related documentation shall be submitted to the commercial bank by the borrower; 

• Direct lending to borrowers (except family farms that are not within the VAT system and associations) – application and related documentation shall be submitted to HBOR by the borrower

Minimum possible individual loan amount: 

• HBOR’s direct loans: generally, loans in the amount lower than EUR 100,000 are not approved; 

• Loans on-lent via commercial banks: generally, loans in the amount lower than EUR 50,000 are not approved; 

• Loans approved under the risk sharing model with commercial banks: HBOR’s share in a loan can generally not be lower than EUR 100,000; 

• Loans for the recovery from the consequences of earthquake and for the economic development of Sisak-Moslavina County: minimum loan amount is EUR 30,000; 

• The maximum loan amount is not limited and depends on the specific features and creditworthiness of the borrower, purpose and structure of investment as well as available HBOR’s sources of finance not included; 

• For loans intended for the recovery from the consequences of earthquake and for the economic development of Sisak-Moslavina County the maximum loan amount can be up to 100% of the estimated value of investment, including VAT (except for loans with interest subsidised under the NRRP funds), provided that financing of VAT for the borrowers that operate within the VAT system is possible only through the award of de minimis aid. In such a case, VAT has to be allocated to working capital in the breakdown of investment contained in the loan application; 

• For loans with the purpose of purchasing a business share in a foreign company: the maximum amount of the loan is not limited but depends on the specific features and creditworthiness of the borrower as well as the available sources of HBOR finance.

Interest rate for loans with subsidy under the NRRP funds

For borrowers and loans that meet the conditions prescribed by the Operational Programmes for the Implementation of Financial Instruments under the NRRP, part of the regular interest rate is subsidised by HBOR in its own name and for the account of the Republic of Croatia as follows: 

• For investments in green and/or digital transition: up to 75% of regular interest rate, but to a maximum of 3.00 p.p. 

• For investments in special areas of the Republic of Croatia and/or RDI (research, development and innovation): up to 65% of the regular interest rate, but to a maximum of 3.00 p.p. 

• For other investments in competitiveness and resilience: up to 50% of the regular interest rate, but to a maximum of 3.00 p.p. Whereby the regular interest rate is determined as follows: 

• In the case of on-lending through a commercial bank, the interest rate is determined by the bank in accordance with its internal documents 

• In the case of direct lending to a borrower: ▪ On loans in the amount lower than EUR 400,000: ▪ Business entities investing in the recovery from the consequences of earthquake and in the economic development of Sisak-Moslavina County: 2.00% p.a., fixed ▪ Business entities that are market competitive and invest in activities of special interest , or are market competitive and invest in special areas of the Republic of Croatia : 4.00% p.a., fixed 

▪ To other business entities: 4.50% p.a., fixed or ▪ At the level of reference interest rate (RIR) for an individual borrower if it is higher than the interest rates referred to in the above indents

• On loans in the amount of EUR 400,000 or above: HBOR determines the interest rate for each individual loan 

The highest possible amount of subsidised interest for a single loan is: 

• EUR 500,000.00 for micro, small and medium-sized enterprises 

• EUR 1,000,000.00 for mid-caps and large enterprises.

The Loan Programme shall apply as of 1 May 2024. Interest subsidy under the NRRP can be approved until the available funds have been disbursed in full, and no later than until 30 June 2026.

Private sector business entities: companies, crafts businesses, sole traders, family farms, cooperatives and institutions. All entities are subject to the General Eligibility Criteria (Opći kriteriji prihvatljivosti).

The call has been open since 8th March 2021, so any addressee can apply at any time after the publication of the call. There is currently no foreseen deadline. Necessary documentation depends on the manner of implementation, the loan programme and type of investment, type and size of the client as well as the purpose and amount of requested loan. If the loan is for the purpose of a RES installation, the investor handles the necessary bureaucracy and procedures for installation of the RES itself with the distribution system operator (currently only HEP ODS d.o.o.) and other necessary entities.

Hrvatska banka za obnovu i razvitak (HBOR)