Our guarantee program COVID III has been extended until the end of June 2021 due to the amendment of the Act on a state guarantee for the COVID program. Amendment was signed by the President on 1 November 2020. Moreover, this program will guarantee not only working capital loans, but also investment loans.
COVID III is a flagship guarantee program of the Czech-Moravian guarantee and Development Bank (CMZRB) in response to the current coronavirus crisis. The program, which started in June 2020, guarantees the respective loan portfolios of commercial banks and savings cooperatives active in the Czech market. Guarantee rate is 90% for enterprises up to 249 employees and 80% for enterprises with 250 to 500 employees. Maximal amount of the guaranteed loan is 50 million CZK. Up to now, only working capital loans have been eligible, covering immediate financing needs such as wages, rent, energy costs, or unpaid invoices. COVID III program will newly guarantee also investment loans, which will allow companies to obtain new machines and technologies, real estates, licences, or software. Detailed information about this guarantee for investment loans will be published soon.
As the coronavirus crisis has gained a renewed strength in last weeks, the European Commission decided to extend the so-called Temporary Framework for State Aid until the end of July 2020. This state aid regime is applied also on our COVID III program, which allows us to extend this program as well. Czech government approved the extended validity of the Act on a state guarantee for the COVID program in line with the Temporary Framework.
With the COVID III guarantee, commercial banks and savings cooperatives can provide enterprises with loans worth of CZK 500 billion. As of October 25, more than 2,300 enterprises benefitted from the COVID III guarantee (total amount CZK 14.4 billion) and another 2,600 enterprises (total amount CZK 15 billion) are in the process of being approved.