site.btaInvestment Instrument for Funding SMEs Created between Bulgarian Stock Exchange, Development Bank, Private Investors

An investment instrument for fully transparent funding of SMEs is created between the Bulgarian Stock Exchange, Bulgarian Development Bank (BDB), and private investors, caretaker Minister of Innovation and Growth Alexander Pulev said, as quoted by his Ministry. He was speaking at a meeting with Bulgarian Stock Exchange CEO Manyu Moravenov and Board of Directors Deputy Chairman Vasil Golemanski here on Tuesday. 

Pulev stressed that the loan limit at the BDB remains at BGN 5 million, and SMEs remain the bank's targeted segment.

The more active interaction with the Bulgarian Stock Exchange will direct part of the bank's loans and investment portfolio towards public markets. "We thud address two problems. The Bulgarian taxpayer's money will be managed publicly and transparently. Everyone will be able to publicly acquaint themselves with everything, the processes will not happen in the dark, and the documents will not be only in some drawers, offices, and archives," Pulev said. He also said that capital markets will be supported through the inclusion in the process of a serious institutional player like the BDB.

Pulev explained that two innovations are being made: broadening of the BDB's product range through co-funding jointly with big financial organizations with impeccable reputation, and making the work as public as possible by funding through public markets and the Bulgarian Stock Exchange. In his words, this will provide new channels for funding SMEs. 

Asked about the BDB's future management, the Innovation Minister said at least two more members will be added to the current three in the Supervisory Board, and the members' salaries will be lower.  

Moravenov said that this is the first time an innovation minister visits the Bulgarian Stock Exchange. He described the new investment instrument as a strong and timely initiative. In his words, companies have expressed interest in funding to the amount of BGN 300 million in the next 12 months through the Bulgarian Enterprise Accelerator Market (BEAM). Due to the crisis of stock exchange markets, investors are very careful, and the institutional support through the proposed investment instrument will have a very encouraging effect on them. The new instrument will fund fully transparently the capital accumulated through the Bulgarian Stock Exchange. It will fund both through participation in bond emissions issued by the Stock Exchange and through Initial Public Offering (IPO) shares.

Moravenov went on to explain that the BDB will be responsible mostly for securing resources for loan funding under the joint project, and the Bulgarian Stock Exchange will be in charge of attracting resources for share funding. The investment instrument will attract additional resources from institutional and individual investors at the Stock Exchange to achieve its goals, and the instrument itself is planned to carry out IPO after its establishment.

Pulev said that to be targeted are green and social projects that will provide new funding channels for SMEs through investments in bonds, including green bonds, and share instruments. 

The Chef de Cabinet of Minister Pulev, Krassimir Yakimov, said that a working group between the BDB, the Bulgarian Stock Exchange, and the Innovation Ministry is set up to build the mechanism for structuring this investment process in light of observing the applicable legislative requirements.