The Board of Directors of the European Investment Bank (EIB) reached a final agreement on Tuesday 26 May on the structure and modus operandi of the Pan-European Guarantee Fund, which, with national guarantees totalling 25 billion euros, could provide indirect support to European companies, especially SMEs, to the tune of 200 billion euros.
The Guarantee Fund will become operational when a group of Member States representing at least 60% of the EIB’s capital have signed their contribution agreement.
As announced (see EUROPE 12493/3), at least 65% of the aid will go to SMEs. A maximum of 23% of the envelope will support companies employing more than 250 people, with restrictions for those with more than 3,000 people. Public enterprises active in the health and health research sector may also be assisted up to a maximum of 5% of the envelope. The rest will help SMEs and mid-caps through riskier financial techniques such as venture capital.
The guarantee provided will enable the EIB to launch a number of operations, including: - guarantee instruments to commercial banks and national promotional institutions; - support for SMEs and mid-caps through venture capital funds; - purchases of asset-backed securities; - venture debt financing of high-growth companies, including within the pharmaceutical sector.
The guarantees provided will enable the financial intermediaries supported to release capital that will again be available to finance the real economy.
More info at: https://bit.ly/3d8Veuz (Original version in French by Mathieu Bion)