The Competition Protection Council has made a decision to further reduce the temporary basic reference interest rate to 6.10 percent, which is applied as the threshold interest rate in determining whether a specific loan is granted under conditions more favorable than market conditions, it was announced today by the Competition Protection Agency.
The Agency’s intention is to facilitate the implementation of programs that provide loans to entrepreneurs under conditions more favorable than market conditions by lowering the basic reference interest rate for state aid providers, primarily HBOR, but also ministries, state funds, development agencies, and units of local and regional self-government.
State aid providers are required to increase the basic reference interest rate of 6.10 percent in each individual case of allocation by the reference risk margin, depending on the credit rating of the specific user and the collateral instruments that the user offers.
The goal of this extraordinary measure is, the Council emphasizes, to facilitate access to capital for Croatian entrepreneurs in the context of the global economic and financial crisis. The new rate will apply in state aid programs approved by the Agency from March 1, 2009, to December 31, 2010.
In this way, approved loans will be considered state aid aimed at addressing serious difficulties in the economy. For loans granted at an interest rate lower than the established reference interest rate of 6.10 percent, the state aid will be considered the difference between the approved and established reference interest rates. In such cases, individual approval from the Agency will be required, the statement notes. (Hina)
