ANNOUNCEMENT 15 Mar 2018

In March 2018, the European Investment Bank (EIB) approved a programme dedicated to supporting mid-cap companies located in Spain and Portugal. The EIB financing will be guaranteed by the European Fund for Strategic Investment (EFSI). 

NUMBER OF INTERVENTIONS

2

  • 2 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

The European Investment Bank, Project summary, MIDCAP PROGRAMME LOAN SPAIN AND PORTUGAL 2: https://www.eib.org/en/projects/pipelines/all/20170871
European Commission (13 January 2015): The Investment Plan for Europe: Questions and Answers: http://europa.eu/rapid/press-release_MEMO-15-3223_en.htm
EIB: European Fund for Strategic Investments - Questions and Answers. Available at: http://www.eib.org/attachments/press/investment_plan_for_europe_qa_en.pdf
Piaggio: https://www.piaggiogroup.com/en/group/where-we-are

Inception date: 15 Mar 2018 | Removal date: open ended
Still in force

Loan guarantee

On 15 March 2018, the European Investment Bank (EIB) approved the Mid-cap Programme Loan for Spain and Portugal 2 having a total value of EUR 400 million (approx. USD 492.4 million). The Programme will support mid-cap companies located in Spain and Portugal. The facility aims at bettering access to finance for these companies. Mid-cap companies are classified as companies with less than 3000 employees. Notably, the Programme may also support SMEs, however, this is not the primary target of the facility. Under the Programme, the EIB has signed a number of loan agreements with mid-cap companies, see related state act.

According to the EIB: "This programme loan will improve competitiveness and access to finance at favourable conditions for SMEs and mid-caps."

 

A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the investment support granted here is discriminatory.

AFFECTED SECTORS

 
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Inception date: 15 Mar 2018 | Removal date: open ended
Still in force

Loan guarantee

The EIB's Mid-cap Programme Loan for Spain and Portugal 2 signed on 15 March 2018 is issued under the European Fund for Strategic Investment (EFSI). The facility has a total value of EUR 400 million (approx. USD 492.4 million).

The Programme will support mid-cap companies located in Spain and Portugal. The facility aims at bettering access to finance for these companies. Mid-cap companies are classified as companies with less than 3000 employees. Notably, the Programme may also support SMEs, however, this is not the primary target of the facility. Under the Programme, the EIB has signed a number of loan agreements with mid-cap companies, see related state act.

The EFSI is a joint initiative by the EIB and the European Commission to promote investment in Europe. The EIB has designated EUR 7.5 billion of its capital for lending to European projects with a higher risk profile than usually taken on by the bank. To compensate for the increased lending risk, the European Commission has agreed to fully guarantee all lending under the EFSI up to a budget of EUR 26 billion. The loan described was issued under the EFSI and thus benefits from a full guarantee through the EU budget.

EFSI support does not fall under EU State Aid rules as it is meant as a tool to address "market failures or sub-optimal investment situations". However, the investment support does include favourable conditions in the form of public assumption of risk.

As described in the European Commission's Fact Sheet from 13 January 2015: "The type of risk-financing instruments will be designed so as to take uncertainty out ("first loss protection") of as such viable projects and therefore crowd-in private sector investments. Since the EFSI will take riskier tranches in investment projects, the private sector will be able to join under more favourable conditions." Furthermore, the EIB states that "The new initiative [i.e. the EFSI] will benefit from the EIB’s strong credit standing that enables funding at favourable conditions and across maturities".

 
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