1. 1 2 nd Danube Financing Dialogue Financing Instruments to support SMEs Belgrade, 24 January 2013 Andreas Beikos Head of Office European Investment Bank Western Balkans Representative Office in Belgrade 11 10/2/2016

2. 2 EIB Group: EIB : European Union’s financing institution Created by the Treaty of Rome in 1958 as the long-term lending bank of the EU Shareholders are the 27 Member States of the EU Policy driven Bank: raises funds on the capital markets which it lends on favourable terms to projects furthering EU policy objectives Operates on a non-profit maximising basis and lends at close to the cost of borrowing AAA rating EIF : EIB Group’s specialist vehicle for VC and guarantees Established in 1994 Shareholders are the EIB, European Union and commercial banks Acts as a “fund of funds” by acquiring holdings in venture capital funds (VCF) which take equity participations in SMEs Extends guarantees to the banking community to foster the provision of medium and long-term loans to SMEs AAA rating 10/2/2016

3. 3 EIB Signatures 1958-2011 10/2/2016

4. 4 Outside the Union: Private sector development Infrastructure development Security of energy supply Environmental sustainability Western Balkans: EIB operates under the Pre-Accession EU Mandate and the Pre-Accession Facility (at EIB own risk) EIB Priority Objectives European Investment Bank 10/2/2016

5. 7 EIB activity in Western Balkans from 2004-2011 EUR M20042005200620072008200920102011Total Approvals321582594479517206612496856493 Signatures265399413443577126291410345307 Disbursements1401862363063153715858592998

6. 9/03/2012 European Investment Bank Group 6610/2/2016

7. 7 European Investment Bank EIB Products In the Western Balkans, the EIB operates primarily through: - Direct loans to projects generally with a cost above EUR 25 million - Intermediated loans channeled through intermediary banks (credit lines to banks), whereby intermediaries are obliged to transfer the financial benefits from EIB resources to SMEs and municipalities - Currently, existing credit lines for SMEs and municipalities in the region amount to EUR 2 billion - Framework loans to central and local public authorities for projects of up to EUR 50 million - The EIB contributes to the European Fund for Southeast Europe (EFSE - www.efse.lu) that provides sustainable financing to micro and small enterprises and to the Green for Growth Fund South East Europe (for RE and EE - www.ggf.lu) 10/2/2016

8. 8 SME financing: A key priority for the EIB SME financing has been reinforced as one of the priority objectives of the EIB Group since 2005 The role of the EIB Group is to facilitate access to finance for SMEs at better financial conditions: channel increased funding sources and intensifying our partnership with the banking sector provide and develop a wider range of products Coherence of the whole EIB Group product range (reinforcing of cooperation between EIB and EIF) 10/2/2016

9. 9 EIB Loan for SMEs SME EIB Loan For SMEs Favorable interest rate loans Financial Intermediary (lending to SMEs) 10/2/2016

10. EIB lending to Banking Sector in Western Balkans from 2002-2011 EUR M200220042005200620072008200920102011Total Serbia204590 37065195875 BiH605510012515015505 FYROM10 10060180180 Montenegro308311124 Albania10 20 13

11. 11 EIB’s support to SMEs in Serbia EIB has signed 13 loan agreements for SMEs in Serbia during the period 2008-2011 for a total of EUR 700m. The EIB cooperates at present with 15 financial intermediaries in Serbia. YearNumber of operations signed Amount (EUR M) 2008150 20096390 2010365 20113195 Total13700 10/2/2016

12. General Terms and conditions for credit lines Loan Size: preferably above EUR 20 m Maturity: up to 15 (5) years for projects by public authorities up to 12 (4) years for SME projects up to 7 (2) years for equipment leasing Eligibility: for financing SME projects and small and medium scale projects in the fields of i2i, energy, environmental protection, industry, health, education and services Security: Sovereign guarantee (for state banks) or parent guarantee (for international banks) Financial benefit to be transferred to the final beneficiary contractually (information obligations on the banks) Stricter requirements on financial intermediaries to inform SMEs of EIB’s intervention and its impact on the financing conditions offered by the intermediary Procurement: intermediary shall ensure compliance with EIB’s guidelines for procurement and with relevant legislation Environment: intermediary shall ensure that final beneficiaries comply with local environmental legislation and pursuing the application of EU standards Due Dilligence fee: from EUR 40,000- 2110/2/2016

13. Western Balkans Western Balkans Enterprise Development & Innovation Facility Enterprise Development & Innovation Facility High Growth WB SME Innovative WB SMEs Pillar 1 “Innovation Fund” EC (WBIF, IPA) EIF, EBRD, other IFIs Pillar 3 Guarantee Facility Pillar 2 “Expansion Fund” WB Beneficiaries EC (WBIF, IPA) EIF, EBRD, other IFIs EC (WBIF), IPA Pillar 4 TA Component on Reforms & Capacity Building EC (WBIF, IPA) WB SME Equity Equity Guarantee Guarantee Financial Institutions Loans Loans Approximately EUR 40 m Approximately EUR 54 m EUR 20 m EUR 9 m Up to EUR 50 m EBRD co-financing facility

14. A new Innovation Fund to focus on seed and early stage equity investments in innovative SMEs; A new Expansion Fund to focus on expansion capital equity investments in high growth SMEs; A new Guarantee Facility to support access to bank lending for local SMEs that currently have limited access to finance; A comprehensive reform programme supported by Technical Assistance resources to allow progress in the - regulatory framework related to equity investments, capacity building as well as supporting the Platform itself Western Balkans Enterprise Development & Innovation Facility (WB EDIF)

15. 15 For more information… http://www.eib.org/ www.eib.org/about/news/the-intermediary-banks-and-financing-institutions-for-credit-lines.htm SMEs can find the list of EIB financial intermediaries in Western Balkans, including contact details, on EIB website. 10/2/2016

16. 16 THANK YOU Andréas Beikos Head of Office European Investment Bank 38-40 Vladimira Popovića 11070 New Belgrade E-mail: a.beikos@eib.orga.beikos@eib.org Tel: +381 11 312 1756 EDIF Platform Ioannis Tsakiris E-mail: i.tsakiris@eif.orgi.tsakiris@eif.org Tel: +352 4379 81373 10/2/2016