Eihbank Allocates €30m Credit Line to EDBI

EghtesadOnline: Following the signing of a short-term refinance deal, the Europaisch-Iranische Handelsbank AG has allocated a €30 million credit line to the Export Development Bank of Iran.

News ID: ۷۸۲۳۰۰

10 April 2018

This was announced by EDBI's director of international affairs who explained that the credit line has been allocated to finance imports of goods and services.

"The bank's customers can apply for using the resources of the refinance credit line by adhering to the regulations of opening import letters of credit and other announced criteria," Hamidreza Maboudi was also quoted as saying by the official website of EDBI.

In outlining the conditions of the credit line, the official said the loan repayment period has been set at six months for essential goods such as medicine and medical equipment, while raw material loans' maturity period will be one year, according to Financial Tribune.

Interest rates on the loans have been set at 2.75%, which will amount to 4.75% by including the 2% processing charges.

In order to tap into the resources of the refinance deal, applicants will need to meet a series of requirements, including formally submitting their request, referring to the Ministry of Industries, Mining and Trade to register their import order and obtaining the permit of using the credit line from the aforementioned ministry.

They will need to offer their audited balance sheets, coordinate with their local branch for smaller loans and contact the Finance and Investment Department of EDBI for bigger loans.

"Obtaining the necessary documents to open credits, including forms, collaterals and guarantees based on the approved criteria, opening sight LCs in euro with a maturity period of six months at the most, purchasing foreign currency as down payment for the credit and paying the sum to the foreign seller are other steps needed for using the resources of the credit line," Maboudi said.

According to the EDBI official, using the funds is strictly conditioned to purchasing goods from European exporters, Germany or otherwise.

Iranian merchants founded Eihbank in the early 1970s to support trade between Europe and Iran. The Hamburg-based bank restarted services to Iran on March 1, 2016, following the implementation of the nuclear accord that lifted sanctions on it.

The bank has customers and business partners in Germany and Iran as well as in Europe and other parts of the world.