SELF-GOVERNMENT Overdraft Loan

Purpose of the loan:

• The loan is intended to balance the time lag between revenues and expenditures in the current budget of towns, villages or higher territorial units (i.e. “self-governing regions”, hereinafter referred to as “HTUs”) during the financial year.

Use of the loan:

• on the client’s current account up to the amount of the approved credit line

Maturity period and repayment of the loan:

• pursuant to Act No. 583/2004 Coll. on Budgetary Rules of Self-governing Territorial Units and on Amendments to Certain Acts, the loan must be repaid by the end of the budgetary year;
• the loan is repaid in a lump sum or by gradual reduction of the credit line.

Fees:

• a preferential loan fee;
• the consideration for the reservation of the funds not granted does not apply;
• other fees are set according to the Price List of VÚB, a.s.

Loan collateral:

• Minimum collateral: assessed on a case-by-case basis

Terms and conditions for granting a loan:

• demonstrating the ability to repay the loan, including interest and fees, within the required maturity period and under pre-agreed conditions;
• a written confirmation of compliance with all conditions for receiving recoverable financial resources in accordance with Act No. 583/2004 Coll., which is issued and signed by the comptroller general (i.e. the chief financial controller) of a village/town/HTU;
• a special-purpose nature of the loan – the bank provides a loan to cover the operational needs of a village/town/HTU;
• loan collateral, including interest and fees;
• other conditions depending on the nature of the business, knowledge and creditworthiness of the applicant (e.g. making a notarial record as a writ of execution for a property).

Required documents

• a written Loan Application, including additional table annexes, depending on the amount and type of the loan an entity applies for and the type of the business entity/applicant;
• a certificate of mayor appointment;
• a certificate of registration and assignment of an identification (registration) number;
• a resolution and signed minutes concerning the approval of the loan application, the consent to the loan collateral and to the issuance of a notarial record and/or to the signing of a blank bill;
• a detailed budget and audited financial statements for the last two financial years and current financial statements for the last six months;
• an approved budget management plan of a village/town/HTU for the relevant year,
• documents necessary for the loan collateral.