Malta Development Bank (MDB) on Tuesday signed strategic agreements with Bank of Valletta plc (BOV), HSBC Bank Malta plc (HSBC) and APS Bank plc (APS) for them to serve as intermediary partners for its two new flagship financing schemes.

Each of these banks brings a wealth of experience in supporting Maltese businesses and shares MDB’s vision of “driving economic growth and sustainability through targeted financing solutions”.

Through the agreements, MDB and its intermediary partners will offer a “comprehensive suite of benefits to SMEs”, including lower interest rates, reduced collateral requirements, as well as better credit terms. The partnerships mark a “significant milestone” in MDB’s commitment to “fostering the growth and development” of SMEs in Malta.

MDB will be collaborating closely with the banks to provide “tailored financial products and services to businesses”. Access to funding, promoting innovation and empowering SMEs to thrive in today’s business landscape will be leveraged by the banks’ extensive networks and expertise, MDB said.

The two schemes, the SME Guarantee Scheme and the Guaranteed Co-Lending Scheme, which were launched last year and carry a portfolio of up to €180 million in new loans, “seek to encourage entrepreneurs to invest in projects that contribute to growth in a variety of traditional and innovative economic sectors”.

Access to the aforementioned schemes is now available through the intermediary banks. The SME Guarantee Scheme supports investments of up to €750,000 while the Guaranteed Co-Lending Scheme can address the financing needs of larger projects of up to €10 million. In line with national and European-wide priorities, the initiatives also serve as a “tool to mobilise private investment through risk mitigation” and will offer support to firms in undertaking the climate and digital transitions required to “meet existing challenges and prepare themselves for further growth”.

MDB Chairman Josef Bonnici / LinkedIn

Commenting on the agreements, MDB Chairman Josef Bonnici remarked that they represent a “major breakthrough for business operators and a key milestone for MDB”, as it is the “first intermediation agreement” with the local banking industry, besides the COVID-19 Guarantee Scheme.

As a result of the agreements, three major Maltese banks will join forces with MDB to offer businesses with “simplified and cheaper access to finance, allowing firms to address the current challenges and implement the necessary transformation to keep growing in the years ahead”, he explained.

MDB CEO Paul V. Azzopardi

MDB CEO Paul V. Azzopardi expressed enthusiasm and confidence in the combined expertise and resources that the banks bring to the table.

“We are thrilled to join forces with BOV, HSBC, and APS to drive the growth and prosperity of SMEs via new investment in traditional sectors of the economy as well as the new sectors of climate improvement, digitalisation, and sustainable economic activity,” he said.

“By leveraging our collective strengths and market presence, we will provide SMEs with the necessary financial support to realise their ambitions and contribute to economic development,” Mr Azzopardi concluded.