Government measures in key jurisdictions 3rd edition final - Flipbook - Page 92
Lars Eirik Gåseide Røsås | lgr@thommessen.no | +47 23 11 13 38
Loans and
financial
support
Has the
government put in
place any new
bank funding
schemes?
The Norwegian Government has set up financial aid for businesses, in particular through existing
and new liquidity assistance programs.
A NOK 50 billion State Bond Fund has been passed to provide liquidity to larger Norwegian
businesses, through government purchases of bonds. The State Bond Fund will invest within all
business sectors. A significant portion of the State Bond Fund will be placed in non-financial
business, but the mandate also includes investments in bonds issued by banks. The mandate states
the investment scope within different sectors. The State Bond Fund will only be mandated to invest
in bonds issued by companies incorporated in Norway, i.e. business with their main office in
Norway. As of 8 May 2020 the mandate was adjusted to include not only investments in companies
with a rating of B- and higher, but also companies with a CCC+ rating.
A NOK 50 billion State Guarantee Scheme ("SGS") for small and medium businesses has been
passed pursuant to which a state guarantee aimed at facilitating loans to small and medium
businesses ("
") which have experienced acute liquidity distress as a result of the Covid-19
outbreak. Under the SGS the state guarantees for 90% of each bank loan. SMBs are defined as
companies with less than 250 employees and yearly revenues not exceeding EUR 50 million, or
companies with a combined balance sheet not exceeding EUR 43 million. The State Guarantee
Scheme was on 2 April 2020 expanded to include larger companies not caught up by the definition
of SMB.
Under the State Guarantee Scheme SMBs are eligible for guarantees on loans up to NOK 50 million
and larger companies are eligible for guarantees on loans up to NOK 150 million.
On 20 May 2020 the government proposed to extend the SGS to beyond 1 June until 31 December
2020. The government will continue to consider the necessity of the State Guarantee Scheme.
Moreover, the extension must be approved by ESA.
The Ministry of Finance has reduced the countercyclical capital buffer requirement from 2.5 to 1%
with immediate effect, later combined with proposal to prohibit dividend distributions by
Norwegian financial institutions.
A NOK 6 billion State Guarantee Scheme for the aviation transport industry has been passed. The
guarantee scheme will be administered by the Norwegian export finance institution GIEK. The
scheme entails the state guaranteeing loans up to 90%, with commercial lenders taking on the
remaining 10% exposure. The scheme is available to commercial airlines holding Norwegian Air
Operator's certificates. Of the total NOK 6 billion, NOK 3 billion has been allocated to Norwegian,
NOK 1.5 billion to SAS and NOK 1.5 billion to Widerøe together with some smaller airlines.
The government passed a State Compensation Scheme under which companies which have
suffered a minimum of 30% reduction in revenues due to the Covid-19 outbreak can apply for state
compensation. On 29 May 2020 the government announced that the State Compensation Scheme
was extended until 31 August 2020.
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Government measures in key jurisdictions