The second state guarantee is formalized, loans of up to 300 million [ALL], interest up to 5%

The decision to approve a guarantee fund of 15,000,000,000 (fifteen billion) ALL has been published in the Official Gazette, in favor of commercial banks operating in the territory of the Republic of Albania. This fund is part of the guarantee scheme that will enable lending to traders and commercial companies to secure the necessary funds for working capital and investments to support the recovery of commercial activity affected by the situation created by COVID-19.

The state guarantee line, issued in favor of each commercial bank, is as follows:

• Raiffeisen Bank sh.a. Albania, up to the amount of 2,600,000,000 Albanian Lek;
• Tirana Bank j.s.c. up to the value of 850,000,000 Albanian Lek;
• Banka Union sh.a. for the amount of 800,000,000 ALL;
• Banka Intesa Sanpaolo Albania sh.a. up to the value of 1,200,000,000 lek;
• National Commercial Bank JSA up to the value of 2,550,000,000 Lek;
• OTP Bank Albania sh.a. up to the amount of 1,450,000,000 lek;
• Banka Procredit sh.a. up to the value of 600,000,000 lekë;
• Banka Alpha Albania sh.a. up to the amount of 950,000,000 lek;
• American Investment Bank sh.a. up to the value of 650,000,000 Lek;
• Banka Credins sh.a. up to the value of 2,800,000,000 lek;
• United Bank of Albania sh.a. up to the value of 150,000,000 lek;
• First Investment Bank, Albania sh.a. up to the value of 400,000,000 Albanian Lek.

The purpose of the guarantee scheme is to stimulate lending by commercial banks operating in the Republic of Albania, to enable traders or commercial companies to obtain the necessary financing to revive their commercial activity, which has been directly or indirectly affected by government laws and regulations in the context of managing the situation created by COVID-19.

GUARANTEE

1. MFE undertakes to guarantee the Lender up to the amount of [XXXXXX] (in words) ALL (“Guarantee Amount”), subject to the terms and limitations expressly set forth in this Agreement. The Guarantee Amount represents the maximum amount of payments to be made by MFE to settle unpaid obligations to the Lender arising from the Loans subject to this guarantee scheme.
2. The MFE undertakes to guarantee up to the Guarantee Amount set forth in clause 1 of this Article, 60% of the principal of each Loan that the Lender will advance to the Borrowers under the terms set forth in this Agreement.
3. “Guaranteed Loan Value” shall mean the maximum amount guaranteed under this Agreement, respectively for each of the Loans disbursed by the Lender, in accordance with the terms of this Agreement, and which shall be equal to the product of the Loan principal and the percentage of the principal guaranteed by the MFE in accordance with point 2 of this article.
4. Under no circumstances will the MFE undertake the guarantee of interests, late fees, penalties, or any other type of monetary obligation that may arise from loans that the Lender will disburse to the Borrowers.
5. The maximum accumulated amount of the Guaranteed Loan Value arising from Loan disbursements and calculated according to point 3 of this article shall not exceed the Guarantee Value stated in point 1 of this article. Any new disbursement of any Loan that exceeds the aforementioned value is not guaranteed by this Agreement, except when the total amount of the Guaranteed Loan Value, together with the Guaranteed Loan Value arising from the new disbursement, does not exceed the Guarantee Value.
6. In case the Lender has exhausted all the Guarantee Value available to it as determined in point 1 of this article, the Lender shall notify the MFE in writing within a period of 5 (five) business days.
7. The Minister of Finance and Economy has the right, after ninety (90) days from the date of signing the respective agreements, if necessary, according to the report of the special inter-institutional structure, to propose to the Council of Ministers the reallocation of the guarantee amount, from the lender who has not exhausted the guarantee amount in their favor to the lender who has fully exhausted it.

Borrower Qualification Criteria and Loan Eligibility Criteria

The Lender will provide Guaranteed Loans under this Agreement only to Borrowers who meet the following criteria:

14. a) The borrower must be a trader or a commercial company registered with the National Business Center in accordance with Law No. 9901 of April 14, 2008 "For traders and commercial companies," as amended, and Law No. 9723 of May 3, 2007 "On Business Registration," and the capital structure must be 100% owned by non-public entities.
15. b) An entrepreneur can be a subject that carries out commercial activity in all sectors of the economy, provided that their commercial activity has been directly or indirectly affected by legislative and sub-legislative acts of the government in the context of managing the situation created by COVID-19, through the temporary closure of commercial activity or through the impact of reduced commercial activity.
16. c) The bidder must not have unpaid tax obligations for 3 tax periods simultaneously: December 2019, January-February 2020, excluding taxpayers who have entered into an installment payment agreement for tax obligations, as well as taxpayers whose unpaid obligations are under appeal at all levels.
17. The purpose of using the Loan funds is to provide the Borrower with the necessary funds for working capital and investments to support the recovery of business activity affected by the situation created by COVID-19. Under no circumstances shall the Loan funds be used to finance illegal activities or to refinance other loans.
18. The employer must sign the Memorandum of Understanding
19. The borrower must sign the self-declaration form that will be made available by the Lender, whereby they declare that
20. Has not applied for and received any other Hua covered by this guarantee scheme;
21. The Loan Funds shall be used solely for the purposes specified in point 2 of this article.
22. The Borrower shall submit the Loan Application Request to the Lender no later than sixty (60) calendar days from the date of signing this Agreement.
23. MFE reserves the right at any time to review, add to, or remove any of the criteria cited in the above points of this article, by pre-notifying the Lender. Such change shall become effective immediately upon receipt of written notification from MFE by the Lender. No change made in accordance with this point shall affect Borrowers whose Loans have been approved prior to the effective date of such change.
24. Except in special cases, as determined in point 6 of this article, the Lender will in no event approve the Loan requests of Borrowers who do not meet the conditions stipulated in points 1-5 of this article.

Lender's Obligations

1. The Lender undertakes to use the application forms, which guarantee the security of all information cited in Article 3 of this Agreement, in accordance with its banking practices for these products.
2. The lender is responsible for completing the loan application documents and keeps copies of these documents in its archives.
3. The lender takes measures to ensure that the human resources staff who will be involved in lending have the necessary expertise and are familiar with the policies and procedures of this guarantee scheme.
4. The Lender shall process the loans that will be part of this Agreement with professionalism and in accordance with the internal criteria and procedures it applies during its ordinary lending activity for similar commercial banking products, as well as in accordance with the content of Article 3 of this Agreement.
5. The Lender will perform the credit risk assessment of the Borrowers in accordance with banking standards and legislation, referring to the Borrower's financial status no later than February 2020.
6. The lender must register the loan immediately after disbursement in the credit registry with a specific designation: “Loan for working capital and investments under the state guarantee scheme for the COVID-19 situation.”.
7. The Lender is obliged to verify through the credit registry at the Bank of Albania at the time of the Loan application, as well as before the Loan disbursement, whether the Borrower is a beneficiary of any Loan within the same guarantee scheme from other Lenders. Also, the Lender, in accordance with Article 3, paragraph 4, must make available to the Borrower the self-declaration form, according to the form and content that the Lender deems reasonable.
8. In the event that the Borrower has obtained a Loan for the same guarantee scheme from another Lender, any other loan approved after the first Loan shall not be subject to this Agreement.
9. The Lender must not favor any of the Borrowers based on its preferential criteria.
10. The Guarantor shall make available to the MFE (or any other structure authorized by the MFE for this purpose), upon request by the latter, copies of files, extracts, documents, registered data, and correspondence of all Loans subject to this Guarantee Agreement.
11. The Lender reviews the necessary documentation and approves the Loan in accordance with its internal deadlines and procedures, as well as guarantees the transfer of funds to the Borrower's account, as per point 1 of Article 5, and the use of the Loan for the purpose covered by the State Guarantee for the recovery of the Borrower's commercial activity, which has been directly or indirectly affected by the government's legal and sublegal acts within the framework of managing the situation created by COVID-19.

Terms and Conditions of Loan

1. The Loan Amount made available by the Lender to the Borrower may vary according to the request submitted by the Borrower, but in no case shall it exceed 300,000,000 (three hundred million) ALL.
2. Notwithstanding clause 1, in no event shall the amount of Loans with a value exceeding 150,000,000 (one hundred fifty million) lekë be higher than 501 TP3T of the total Loans granted under this Agreement.
3. The Loan Term should be at the discretion of the Borrower, but in no case to exceed the term of 5 (five) years.
4. Financing can be in the form of a loan, overdraft, or line of credit, assessed in accordance with the credit risk level and the Borrower's preferences.
5. Regardless of the product with which the loan will be offered, the principal grace period will not be less than 6 months, unless the Borrower prefers a shorter period.
6. In cases of loan prepayment, the Lender shall not charge any commission, penalty, or any other measure related to the loan prepayment.
7. The credit coin must be in the local currency (Lek).
8. The lender shall offer the Loan at a preferential annual interest rate equal to: (i) the average interest rate of the three most recent 12-month Treasury bonds issued by the Government of the Republic of Albania (reference/index), plus (ii) a margin of up to 3.01 TPB depending on the Loan term and the product in which the Loan is offered. The annual interest rate shall be variable on an annual basis based on the reference/index, but expressly provided that in no event shall the annual interest rate exceed 5.0%.
9. The Lender, based on the credit risk assessments for each Borrower, has the right to request or not request additional collateral from the Borrower, but in no case shall the allocated amount of collateral, including the Guaranteed Value of the Loan under this Agreement, exceed the coverage calculated according to the legislation and internal rules of the Lender.
10. The terms and conditions of the Loan will be determined in the Loan Agreement, which will be signed between the Lender and the Borrower, in accordance with the contents of this agreement. The terms and conditions stipulated in the Loan Agreement that conflict with this Agreement shall be deemed void and shall not produce any effect against the MFE.
11. No transfer of the Lender's rights or obligations arising from this Agreement or the Loan Agreement may be assigned to third parties without the prior written approval of the MFE.
12. For any amendment, renewal, or restructuring of the Loan Agreement, which may be made in the agreement between the Lender and the Borrower within the period specified in point 2 of this article, the approval of the MFE is not required, provided that such changes will not have any effect on the rights of the Lender against the MFE, under the conditions specified in this Agreement. The Lender shall notify the MFE (or any structure authorized by the MFE) in writing of any amendment, renewal, or restructuring of the Loan Agreement.
13. The Borrower is responsible for ensuring that the total amount of the Guaranteed Loan Value does not exceed the Guarantee Value issued by the MFE in its favor according to Article 2 of this Agreement. Under no circumstances shall exceeding the Guarantee Value constitute an obligation for the MFE.
14. The Loan shall be deemed to be terminated and shall no longer be the subject of this Agreement only after it has been fully repaid by the Borrower in accordance with the terms and conditions of the Loan Agreement. The Lender shall notify the MFE in writing of all terminated Loans within 10 (ten) calendar days from the date of their termination.