Greek government tables draft law to create Development Bank

Greek Economy & Development Ministry tabled a draft law in Parliament on Monday envisaging the transformation of the Hellenic Fund for Entrepreneurship and Development (ETEAN) into a Development Bank, to support investment programs and projects with environmental and development dimensions.

The Bank’s strategic target will be to promote cyclical economy policies, deal with the consequences and the adjustment to climate change and create conditions of sustainable and fair growth. It will operate through branches in all regions of the country.

Economy Ministry estimates show that the bank will mobilize investments – through leverage – of more than 11 billion euros. The bank will be self-financed, using money from EU funds, the banking system and private investors. It will operate as a societe anonyme and will not offer funds to enterprises directly but through the banking system of investment capital companies, along with offering consultancy services to enterprises.

More specifically, the Development Bank will be able to operate in the following areas:

– Providing loans and similar credits to companies through financial sector entities, investment development funds or funds and other funding agencies.

– Providing guarantees and counter-guarantees to businesses of all kinds to meet their obligations to credit or financial institutions, venture capital funds, investment and development funds, funds or other funding agencies, which are due to all kinds of financial facilities.

– Design, management and implementation of projects and programs that serve its statutory purpose and design, establishment and management of funds, funds and financial engineering instruments, in accordance with national and European Union law.

– Provide all forms of funding to businesses, including grants, in particular to create structures, processes and functions that enhance their sustainability, innovation and competitiveness.

– Co-investment, lending and participation in: (a) financial and financial institutions; (b) insurance and investment funds; (c) funds and all forms of capital and financing of enterprises, guarantees, venture capital, Public Private Partnerships (PPP), investment schemes and businesses by placing and providing capital to the company or funds managed by the bank.

– Development of cooperation with international investment organizations for the participation of public entities, PPPs, individuals in regional or European projects in the direction of the priorities of the National Development Strategy and the Plan for Balkan Cooperation and Co-Development.

– Establishment and/or participation in startup and innovation support enterprises, entrepreneurship incubators, technology transfer offices and entrepreneurship support bodies, and funding of existing or new such structures.

– Funding through trade and cooperative banks, financial institutions, investment development funds or funds and other funding bodies, export-oriented enterprises, exemplary through issuance and discounting of credit notes, receivables and guarantee letters.

– Financial support for enterprises, in particular through grants, to carry out scientific research and or studies that contribute to the promotion of their action and their commercial object.

– Funding businesses or other organizations to strengthen economic and social cohesion and promote the social economy and employment and provide microcredit, directly or indirectly, with or without cooperation with national, supranational and international organizations and organizations.

– Consulting and providing know-how, directly or indirectly, to businesses and institutions at national and international level, including the design and implementation of financing tools, business restructuring, optimal use of available resources, and so on.

– Provide, directly or indirectly, business support and training, with a particular focus on microenterprises, in terms of capital structure, administrative organization and forms of modern corporate governance, business plan development, financing needs, distribution network management, human resources, accounting and finance, mergers and acquisitions, promotion and strengthening of cooperation between them to build economies of scale, and support in any other area of their business activity, including the funding of programs that promote the achievement of the above objectives.

– Development of studies and surveys of the country’s macroeconomic and microeconomic environment to identify and address dysfunction, inefficiency and market failures.

Finally, with the same draft law, the New Economy Development Fund is renamed the Hellenic Development Bank for Investment. The main criteria for the participation of the company (ex TANEO) in investment schemes are the reliability of investment proposals and managers as well as the contribution of funded business activities to the development of the economy.

It should be noted that the Articles of Incorporation, which provide for the name, duration and majority shareholding of the Greek state, which cannot be reduced by more than 50% plus one share, cannot be changed in the societe anonyme.