The Malta Development Bank has just launched the COVID-19 Guarantee Scheme (CGS).
The MDB COVID-19 Guarantee Scheme (CGS) provides guarantees to commercial banks in order to enhance access to bank financing for the working capital requirements of businesses in Malta facing a sudden acute liquidity shortage as a result of the COVID-19 outbreak.
The CGS has been approved by the European Commission under the Temporary Framework for State aid measures to support the economy in the current COVID-19 outbreak (European Commission Press Release).
CGS is part of the wider package of Government’s COVID-19 Response Support Programme.
A Guarantee Fund of €350 million has been allocated by Government for the purpose of guaranteeing loans granted by commercial banks in Malta to meet new working capital requirements of businesses facing cashflow disruptions due to the effects of the COVID-19.
The CGS will enable the commercial banks to leverage Government’s guarantees up to a total portfolio volume of €777.8 million to support all types of businesses.
The CGS has been entrusted to the Malta Development Bank (MDB) which is responsible to develop, administer and implement the scheme. The CGS will be intermediated via commercial banks in Malta.
Loans will be available from the commercial banks accredited by the MDB. Loan applications are assessed by the commercial banks in line with their credit policy criteria. Final approval rests with the commercial banks.
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