The European Commission has approved a €411 million capital injection by the Croatian government into the national development bank Hrvatska Banka za Obnovu i Razvitak (HBOR) under EU State aid rules.
The funding will come from the EU’s Recovery and Resilience Facility (RRF) — a post-pandemic programme that supports reforms and investment in member states — following the Commission’s positive assessment of Croatia’s recovery plan and its adoption by the Council, the Commission announced on Monday.
HBOR will use the capital to support small and medium-sized enterprises (SMEs), renewable energy projects and infrastructure development.
The bank will also prioritise investments linked to digital transformation, eco-friendly technologies, regional connectivity and the defence industry as part of an expanded remit.
State aid assessment
The Commission assessed the measure under EU State aid rules, including Article 107(3)(c) of the Treaty on the Functioning of the EU, which allows member states to support certain economic activities under specific conditions, it said.
Croatia committed to limit HBOR’s financial activities to areas where markets do not deliver sufficient funding, and to apply measures intended to avoid undercutting private financial institutions active in the Croatian market.
A non-confidential version of the decision will be published in the Commission’s State aid register under case number SA.121107 once confidentiality issues have been resolved.
