Green Loans
BDL Financing Incentives AGRO INVEST تشجيع اإلبتكار في الصناعات الغذائية Banque Du Liban Financing Unit The Tools BDL stimulates financing investments in targeted economic sectors either by Interest Rate Subsidy scheme, or Exempting banks from part of the required reserve requirement, or By providing banks with a soft loan to finance these projects at low cost. Interest Subsidy Micro Credit Incentives 2009 Environmental Loans Incentives 2013 Interest Subsidy on Loans Extended to Productive Economic Sectors 1. 2. 3. 4. 5. Loans extended to local private sector projects in the industrial, touristic, agricultural, IT development and handicrafts sectors benefit from a 4.5% Lebanese Government interest subsidy rate, given the following conditions: The project is in Lebanon. The loan is used to finance a new project or the expansion of an existing one, with a minimum value of LBP 50m or its equivalent (USD/€). The term of the loan must range between 5 and 7 years. The total value of subsidized loans granted to a single economic group, must not exceed LBP 15bill or their equivalent, or an amount of LBP 60bill in case a number of debtors are not considered as a single economic group for justified economic and financial purposes. Interest and commissions (before government subsidy) are as follows: LBP: ≤ 2Yr. TBs. + 1% = 5.84% +1. % = 6.84% FX : ≤ 3Mths. LIBOR (or Euribor) + 7%. Interest Subsidy on Loans Guaranteed by Kafalat SAL Loans guaranteed by Kafalat SAL and extended to SMEs in productive economic sectors benefit from a 4.5% Lebanese Government interest subsidy rate, given the following conditions: 1. 2. 3. Conditions set by Kafalt SAL. The term of the loan is up to 7 years, with a grace period ranging between 6mths to 1 year. Interest and commissions (before government subsidy) are as follows: LBP: ≤ 40%*(1Yr. TBs.) + 3% = (40% * 5.35%) + 3% = 5.14% FX : ≤ 1Yr. LIBOR + 5.5%. Interest Subsidy Micro Credit Incentives 2009 Environmental Loans Educational Loans Incentives 2013 Micro Credit Loans granted through micro credit institutions to individuals and small enterprises employing four people or less, in order to help them start or develop their business in industrial, service, touristic or commercial sectors, provided the following: 1. 2. The loan amount does not exceed LBP 20 million. Its repayment period does not exceed 5 years. Interest Subsidy Micro Credit Incentives 2009 Environmental Loans Educational Loans Incentives 2013 Incentives 2009 This scheme started for loans granted since January 1, 2009 to finance new projects or expand existing ones in the all economic sectors (except real estate development), and will continue till December 31, 2013 , provided the following: 1. They are not granted for the purpose of financing working capital or refinancing existing projects or commitments. 2. Grace period can range between six months to four years from the disbursement date. 3. The repayment of principal is up seven years starting from the end of the grace period. 4. Interest and commissions are as follows: LBP: ≤ 40% * 1Yr. TBs. + 3% = 2.14% + 3% = 5.14% FX : ≤ Cost of Funds + 2%. Interest Subsidy Micro Credit Incentives 2009 Environmental Educational Loans Incentives 2013 Loans Sectors that can benefit from the NEEREA mechanism Industrial Sector, Touristic Sector, Agricultural Sector, Commercial Sector, Medical Sector, Educational Sector, Residential Projects (Buildings, Houses), Other sectors… Environmental Projects Energy Related (NEEREA Mechanism): Any undertaking related to Energy Saving and Renewable Energy. Lighting, Ventilation systems, Generators, Heating and Cooling, Refrigeration, Furnaces, Boilers, Solar Energy, Photovoltaic, Biomass, Wind energy, Buildings envelope. Non-Energy Related: Any project concerned with pollution abatement, solid waste and waste water treatment, recycling. Ecotourism, organic agriculture, cladding and landscaping. Environmental Projects New Projects: Repayment period up to 10 years, beginning after the end of the grace period. Grace period ranging from 6 months to 4 years. Re-modeling Existing Projects: Repayment period up to 10 years, including the grace period. Grace period ranging from 6 months to 2 years. Subsidized Interest Environmental Loans During Interest Subsidy Period Interest + Commissions ≤ LBP : Rate on 2Yr. TBs. ≈ 5.84% USD : LIBOR 3Mths. + 6% ≈ 6.28% After Interest Subsidy Period Interest + Commissions ≤ LBP : Rate on 2Yr. TBs. – 2.5% ≈ 3.34% USD : LIBOR 3Mths. + 2.5% ≈ 2.78% Non-Subsidized Environmental Loans Energy Related Interest + Commissions ≤ LBP: 3% - 50% (1Yr. TB. Yield) ≈ 0.325% USD: Cost of Funds + 2% - 50% (1Yr. TB. Yield) Non-Energy Related Interest + Commissions ≤ LBP: 3% USD: Cost of Funds + 2% Grant Contract Signed between BDL and EU A grant contract was signed to support investments in sustainable energy in the amount of €12,200,000. The Central Bank would, pay a grant to subsidize loans extended to finance energy projects, with a maximum amount of $5m. energy loans: 15% 5% • Of the value of the non-subsidized energy related loan • Of the value of subsidized energy related projects • Funds are allocated to the project after BDL/EU Consultant approves the technical study proposed. BDL • The grant money allocated would be disbursed upon final execution, and after technical validation. Interest Subsidy Micro Credit Incentives 2009 Environmental Loans Educational Loans Incentives 2013 Incentives 2013 A new stimulus package has been recently introduced by the Central Bank, consisting of USD 1.46 billion in the form of soft loans extended to Lebanese banks in order to boost lending activity and fuel economic growth, provided the following general conditions: The Central Bank extends these loans at an interest rate of 1%. Funds are allocated to banks on a first-come first-served basis. Incentives are provided to support housing, education, renewable energy projects, innovative projects, research & development ventures, entrepreneurship, and various productive sectors of the economy. The loan to the final beneficiary is used to finance a new project or the expansion of an existing one. Loans cannot be used to finance working capital expenditures or to finance acquisitions of shares and participations in legal entities. The 1% interest cost is to borne equally between the bank and the beneficiary. Incentives 2013 Loans granted in LBP to entrepreneurs to finance new projects in the field of knowledge and innovation: The loan amount does not exceed LBP 300 million. The borrower is granted a grace period of one to three years as of the disbursement date. The reimbursement period of the loan principal does not exceed seven years, excluding the grace period. All interest and commissions should not exceed 0.75%. Incentives 2013 Loans granted in LBP to finance Research and Development Ventures in productive sectors: The borrower is granted a grace period of two to four years as of the disbursement date. The reimbursement period of the loan principal does not exceed ten years, excluding the grace period. All interest and commissions should not exceed 0.75%. Incentives 2013 Financing Scheme Loans from Banks (Billion LBP) Cost on Beneficiary Multiplier Loan from BDL (Billion LBP) Subsidized Loans 333 2 Yr. Tbs + 1.075% LIBOR 3mths. + 7.075% 15% 50 Subsidized Loans – Kafalat 166.7 40%*1Yr. Tb + 3.3% 60% 100 Total 500 150 Incentives 2013 Financing Scheme Loans from Banks (Billion LBP) Cost on Beneficiary Multiplier المؤسسة العامة لإلسكان 600 20%*2 Yr. Tb + 3.9% 80% 480 جهاز إسكان العسكريين 80 2.128% 100% 80 قضاة 22 2.128% 100% 22 المهجرين 30 2.128% 100% 30 األمن العام 30 2.128% 100% 30 قوى االمن الداخلي 50 2.128% 100% 50 667 40%*1Yr. Tb + 3.3% 60% 400 Housing Loans – Banque de L’Habitat 80 3% 100% 80 Total 1,559 Incentives Housing 2009 - Loan from BDL (Billion LBP) 1,172 Incentives 2013 Loans from Banks (Billion LBP) Cost on Beneficiary Multiplier 416.7 40%*1Yr. Tb + 3.3% 60% 250 Educational Loans 50 3.5% 100% 50 Research Development 15 0.75% 150% 22.5 100% 10 150% 22.5 Financing Scheme Incentives 2009 Non Housing – and Micro Credit Innovative Ups Total 10 Start- 15 506.7 0.75% Loan from BDL (Billion LBP) 355 Incentives 2013 Financing Scheme Loans from Banks (Billion LBP) Cost on Beneficiary Multiplier EIB/AFD Energy 160 0% - 0.75% 150% 240 Energy Loans 150 3.75%- (50%*1Yr. Tbs ) 150% 225 Solar Panels Loans 10 0.75% 150% 15 10 0.75% 150% 15 World Bank – Pollution Abatement 23 WB rate + BDL Comm + 3.5% Bank Spread - (100%*1Yr. Tbs) 100% 23 Environmental Subsidized Loans 50 2 Yr. Tbs + 0.15% 30% 15 Total 403 533 Grand Total 2968.7 2,210 Solar Energy Rural Ares – Loan from BDL (Billion LBP) Thank You
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