The European Investment Bank (EIB) said Dec. 29 that it is lending continued support to small- and medium-size enterprises (SME) and midsize companies in Turkey by investing $177.8 million in a covered-bond program.
The covered-bond program was created by Akbank. The program will be the first covered-bond program in the country. The program is supported by residential mortgages throughout Turkey.
Funding from the EIB will be distributed to eligible businesses and SMEs by the bank.
The rise of SMEs and midsize companies has proven to be an important part of the country's economy. The EIB's backing of the program allows more of these kinds of enterprises to be funded.
EIB Vice President Pim van Ballekom said Turkey is the largest recipient of EIB support outside of the European Union.
"Following the successful launch of SME covered bonds in Turkey; the inauguration of mortgage covered bonds in the Turkish market is expected to have a catalytic effect, adding one more innovative funding option to the long-term funding toolset available to Turkish banks for the benefit of SMEs and midcaps," Van Ballekom said.