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Financial Partner of the Brussels-based SMEs Innovating through EU Regional Policy 12 th June 2006 Mobilising & Sustaining Private Investment Serge Vilain.

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Presentation on theme: "Financial Partner of the Brussels-based SMEs Innovating through EU Regional Policy 12 th June 2006 Mobilising & Sustaining Private Investment Serge Vilain."— Presentation transcript:

1 Financial Partner of the Brussels-based SMEs Innovating through EU Regional Policy 12 th June 2006 Mobilising & Sustaining Private Investment Serge Vilain Chairman

2 History and mission Brussels Regional Investment Company S.R.I.B. - G.I.M.B. Set up in 1984 Size: Capital share: EUR 75 mio Equity: EUR 138 mio Shareholders: Brussels-Capital Region 76% Private: 24% Main mission: to support the creation and the growth of brussels-based companies

3 Brussels-Capital Region : Some data o Set up in 1980 o Surface area: 162km communes o Population: 1 mio inhabitants (9,7% pop. Belgium) Unemployment: 16% pop. o Economy: Service-oriented economy 17% of the salaried belgian population in Brussels

4 Why a Regional Investment Company ? - to equity for SMEs - to start-up capital - to micro-financing Banks = main source of financing But structural changes + Basel II to bank financing for SMEs Market Failures Finance Gap S.R.I.B. acts to improve the access Limited scope of the Venture Capital Industry Limited access to start-up financing Micro-financing

5 Financial Instruments Contribution in equity or quasi- equity Start-up financing Local & social economy Association with Fonds de Participation Investments Cofinancing Capital expansion & buy outs Guarantees to obtain bank credit Partnership with EIB Facilitating the SMEs bank financing by partnerships

6 o Forms of financing: equity (minority shareholding) - exit planned after 5 to 7 years long term loans (without security), convertible loans, … o Scope of investments: Seed & start-up financing (Brustart) Expansion capital & buy outs (SRIB) not limited to high growth potential companies o Amount of the investment: from EUR 12K to EUR 3,7 mio o Goals: Added value for the Region Return On Investment o Advice & support o Leverage effect: bank financing / others investors Some companies in portforlio Equity & quasi equity

7 Subordinated loan From EUR to EUR From EUR to EUR Rate: 4%Rate: 4% Micro-credit: IndividualsIndividuals Personal contribution: min EUR 620Personal contribution: min EUR 620 Loan from EUR to EUR Loan from EUR to EUR Rate: 4%Rate: 4% Fonds damorçage: Companies Companies Founders contribution : min EUR 6.200Founders contribution : min EUR Loan from EUR to EUR Loan from EUR to EUR Rate: 4%Rate: 4% Local Economy Support to the development of businesses established in zone Objectif II established in zone Objectif II Social Economy Support to activities with a social goal o Set up in 2001 o Cofinanced by structural funds (Objectif II) o Goal: Support to social & local economy Micro-financing

8 SRIB Portfolio Investments in +/- 250 businesses % invested amounts per activity sector (exc. Brusoc)

9 Investments made in 2005 In EUR Nb investments in 2005 Invested Amounts Average EquityLoansTotal Total:

10 Financial Instruments Contribution in equity or quasi- equity Start-up financing Local & social economy Association with Fonds de Participation Investments Cofinancing Capital expansion & buy outs Guarantees to obtain bank credit Partnership with EIB Facilitating the SMEs bank financing by partnerships

11 o Goal: to facilitate the SMEs financing by providing the guarantee of the Brussels Region in order to obtain a bank credit o Cover up to 75% of the bank credit (85% for starters) o For individuals and SMEs (european definition) o From july 2003: Management of the Fund by SRIB / Fonds de participation) o Nearly 400 demands analyzed in 2005 o Activity 2005 = 5 x activity 2002

12 B2E – Bruxelles PME – KMO Brussel New financial instrument of the SRIB Group

13 Set up in March 2006 EUR 28 mios (15 capital – 13 loan) Loan EUR 50 mios With guarantee of the Brussels-Capital Region SMEs Banks pari passu loans Goal: to facilitate the long term financing of the Brussels-based SMEs Size: EUR 78 mios – financed by SRIB and EIB

14 B2E – Cofinancing activity Bank Brussels-based SME Investment > 200K Loans pari passu From 100K to 750K Rate = Bank rate – 15 pts 50% Max 50% Min Long term loans (min 3 years) Cofinancing pari passu with banks leverage effect Amount loans B2E: from EUR 100K to EUR 750 K – max 50% Interest rate: bankrate – 15 basis pts Decision process: demand of cofinancing introduced by the bank decision within 2 weeks

15 B2E – Eligible projects o Tangibles investments: machines, IT, buildings, …. o Intangibles investments: patents & licences, R&D, protoypes, development of a new product or production process, … Investments to be made by SMEs SMEs: european definition Activity: all sectors except the non-ethical sectors Investments:

16 For more information: S.R.I.B. – G.I.M.B. Rue de Stassartstraat Bruxelles – Brussel Phone: 02 / –


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