TEL AVIV, Dec 13 (Reuters) - The European Investment Fund (EIF) and Israels Bank Leumi have agreed to renew an initiative to increase lending to innovative small and medium-sized enterprises, they said on Wednesday.
The new agreement enables Leumi to provide financing of up to $200 million to technology companies in Israel, with the support of a guarantee provided by the EIF and backed under Horizon 2020, the European Union's framework program for research and innovation.
The original agreement from 2016 was due to expire in March 2018 and enabled LeumiTech, the high tech banking arm of Israel's second-biggest bank, to offer tech companies financing at favorable conditions of up to $100 million.
The program, the first such EIF agreement in Israel, is directed at companies with fewer than 500 employees in need of investment or operating capital to finance research, development and innovation. Companies that qualify may benefit from favorable conditions for credit of up to $8 million.
"In light of the program's success ... it has now been decided on increasing the financing amount by another $100 million and on extending the program for two additional years until March 2020," Leumi said.
So far, 36 deals have been completed through the program, amounting to $55 million in total. Dozens of additional deals are now in different stages of operation and expected to be completed by the new deadline.
The EIF is part of the European Investment Bank. (Reporting by Tova Cohen; Editing by Steven Scheer and Mark Potter)