OREANDA-NEWS. July 31, 2009. During Stage I of granting small credits Ukio bankas received 171 applications for the total amount of LTL 21.497 million. Of them, until now, 80 applications for the total amount of LTL 8.397 million received approval. Until now the Bank signed 42 agreements, reported the press-centre of Ukio bankas.

The loans are extended in cooperation with the state fund UAB Investiciju ir verslo garantijos (INVEGA).

The biggest amount of the loan granted totals LTL 175 thousand, the smallest – LTL 15 thousand. The loans are granted in litas and the average of the interest rate on the loans granted reaches 8 percent.

The most common activity areas of the borrowers include manufacturing industries, retail business, IT services and social activities. The most active companies are from the cities of Kaunas, Vilnius and Siauliai.

“In summary of Stage I results it can be stated that the activity was not very high. In the course of economic recession businessmen rather cautiously evaluate their possibilities and if they can get along without loans most often they do so. We believe in Stage II companies will be more active,” Mindaugas Pasvenskas, head of Ukio bankas Credit Division, said.

As maintained by him, while cooperating with businessmen the Bank provided a number of consultations with the aim to encourage companies to carefully evaluate the present financial situation and the prospects of the business sector or the company. “Today we maintain still more intense cooperation contacts with businesses, analyse the situation and business area together and share our information and experience with them – today we are working shoulder to shoulder with the clients,” emphasised Mr Pasvenskas.

In the words of Ramunas Grenda, the owner of Informaciniai procesai, a Kaisiadorys-based computer selling personal enterprise, which received a credit from Ukio bankas, he is satisfied with a smooth process of lending to business. “It was very convenient that everything was coordinated by a single bank officer and therefore I needn’t contact a multitude of other institutions. I intend to use the credit received for increasing the enterprise’s working capital and accelerating settlements with our suppliers. Extra funds will also allow me to enhance the enterprise’s competitive advantage by granting longer payment terms to the clients,” Mr Grenda said.

His opinion was shared by Aidas Jarasinas, director of Panevezys-based furniture manufacturing company Veju miskas, which also signed an agreement with Ukio bankas. “We also received a credit rather simply without encountering special bureaucratic barriers. We will use the funds for working capital increase and export promotion. We also have the plan to submit an application in Stage II as we believe that now it is the right time to expand our market share,” the company's head said.

Stage I of granting small credits ends on 14 August and businessmen’s applications will be accepted and evaluated until that date. Ukio bankas, Siauliu and Medicinos banks participate in this stage. On 12 May, Stage II was launched and it goes in parallel with Stage I. During Stage II, LTL 100 million will be distributed to promote Lithuania's economy. Stage II will last until the end of the year.

Until 24 July, Ukio bankas received 86 applications for LTL 20.601 million of Stage II. Of them, 24 applications for LTL 5.875 have been approved. Until now the Bank signed 5 agreements whereby companies will receive LTL 1.4 million. The biggest loan granted totals LTL 350 thousand, the smallest – LTL 100 thousand.

“Our recommendation to companies is to make use of a credit repayment guarantee issued by INVEGA, which minimises likely risk of the loan. Another thing facilitating loan repayment to borrowing companies is the possibility of recovering up to 50 percent paid in interest,” reminded Mindaugas Pasvenskas, head of Ukio bankas Credit Division.

In his words, wholesalers and retailers as well as manufacturing industry companies most often apply for credits.