1 European Investment Bank (EIB): Cooperation with local banks to support SME and Mid-Cap investments 1 st Danube Financing Dialogue - EU Strategy for the Danube Region (EUSDR) Priority Area 10 Vienna, 22 nd March 2012 Peter Bandilla, Deputy Adviser, Lending in Central Europe

2 European Investment Bank Introduction on EIB  EU’s long-term lending bank set up in 1958 by the Treaty of Rome  Shareholders: 27 EU Member States  Funding on capital markets: (EUR 76 Bn in 2011)  Financial strength: AAA-Rating, voluntary application of Basle rules  Business model: “non-profit but also no loss”  Lending policy: Anti-cyclical in times of financial crisis

3 European Investment Bank EIB Lending in 2011 and Shareholdership LendingShareholdership

4 European Investment Bank EIB Priority Objectives (within the EU)  Convergence  Trans-European Networks (TENs)  Environmental sustainability  Sustainable, competitive and secure energy  Knowledge Economy  Small and medium-sized enterprises (SMEs) and mid-cap enterprises (midcaps) EIB loans for SMEs of EUR 10.5bn in Europe in 2011: Industry, Energy and transport and Services including tourism

5 European Investment Bank 5 EIB Loan for SMEs

6 European Investment Bank Definition of “EIB Loan for SMEs and Mid-Caps” SME final beneficiaries: any autonomous enterprise or group employing < 250 people MID-CAP final beneficiaries: any autonomous enterprise or group employing < 3000 people Investment to be financed: most investment projects costing up to EUR25 million (limited list of excluded sectors) Financing: up to 100% of project cost or EUR 12.5 million, whichever is smaller Term: up to economic life of project (2 years minimum, 12 years maximum) Project cost can include: used assets, distribution networks and international expansion, long term working capital needs, SME transmission (generation change, staff buy-in; up to EUR 1 million)

7 European Investment Bank How do SMEs and Mid-Caps benefit? Enhancing market capacity - intermediary undertakes to lend at least twice EIB Loan for SMEs and Mid-Caps( “2 x EIB” approach) Transparency - intermediaries must inform SMEs and Mid-Caps of EIB’s presence and impact on their financing conditions: can be done through ‘product labelling’ or direct communication information on website Transfer of value added - commitment by intermediaries to pass on an agreed financial advantage to the SMEs and Mid-Caps: amount and method of transfer negotiated on a case by case basis – eg interest rate reduction, cashback at signature reporting of method and amount of benefit transferred Accountability - speed of allocation to SMEs and amount of benefit transferred seen as key ‘performance indicators’ by EIB

8 European Investment Bank 8 EIB Global Loan Allocations in the Danube Region EUR 6.3 bn between for 16,457 individual allocations (average allocation size of EUR 385,315) 2011 was a record year with EUR 2.1 bn allocations (# 6,468)

9 European Investment Bank 9 EIB Global Loan Partners in the Danube Region

10 European Investment Bank 10 EIB Global Loan Partners in the Danube Region

11 For more information