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You are here: Home News Belgian News One billion of credit extensions to enterprises
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14/11/2012One billion of credit extensions to enterprises

Efforts by Flemish minister-president Kris Peeters CD&V and the financial sector to support the economy and credit facilities for enterprises on track have led them to come up with a bank plan allocating 1 billion euros for long-term business financing. This measure must make it easier for small and medium enterprises to obtain credit extension. The banks are willing to come up with 150 million euros and will collect the remainder by issuing bonds. “Primarily available for institutional investors and good clients,” says Filip Dierckx, president of Febelfin, the organisation of the financial sector. The government of Flanders will provide the guarantees for the loan amounts. “The plan must first be approved by the government of Flanders,” Peeters said. Joining him and Febelfin representatives in talks were the major banks, the employers’ organisations Unizo and Voka, Agoria federation of technological industries and the Flemish building confederation Confederatie Bouw. Peeters has promised that he would not impose any additional taxes on the financial sector in return for their financial contribution. The banks are also prepared to help ailing industries threatened by closure and to provide a so-called care plan for the employees of such businesses with tailor-made assistance for each customer hit by redundancy measures. “This could be in the shape of an extension of their repayments or a drop in the interest rate of their debt,” says Dierckx. This measure was introduced after the Ford Genk closure and the job losses at the plant and its  suppliers, but will apply to all employees. Peeters’ main aim with this plan is to guarantee credits which have become so scarce as a result of stricter capital regulations for banks. These primarily include credit extension to SMEs and long-term loans. To this end he also wants to extend the anti-crisis fund Gigarant.  He is well aware of the fact that these government guarantees, which are intended to safeguard banks from the risks of credit extensions, will ultimately be funded by taxpayers and insists that it will be treated with care. Meanwhile the federal government has tabled plans to use private savings to boost the economy. An task group IKW with member of the ministerial offices has already come up with a number of proposals, including a B Savings account which will be used to extend credit to small businesses and social projects, tax cuts on bond loans of businesses or on investments in risk capital such as shares, as well as a so-called public loan through sovereign bond issues.




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