EU loan guarantee agreement for innovative SMEs signed in Portugal
Brussels, 17 April 2013
A new EU loan guarantee agreement for innovative small and medium-sized enterprises (SMEs) was signed today with BPI bank in Portugal. Under the Risk Sharing Instrument (RSI), a joint initiative of the European Investment Bank Group and the European Commission, the European Investment Fund (EIF) and BPI have signed a guarantee agreement which will allow support up to €60 million of lending to innovative SMEs over the next two years.
The agreement allows BPI to provide innovative companies with access to a total of €60 million of debt finance over the next two years and with support of the 50% guarantee offered by the EIF. This will make it easier for BPI to offer innovative companies additional financing at favourable conditions.
This is the first RSI agreement in Portugal and tenth in Europe, bringing the total maximum loan finance made available to innovative businesses across the EU to almost €1bn.
On the Risk Sharing Instrument (RSI)
The RSI aims to encourage banks to provide loans and leases of between €25,000 and €7.5 million to SMEs and small mid-caps undertaking research, development or innovation, and seeking finance for investments and/or working capital. RSI is supported by the European Union under the Seventh Framework Programme for Research and Technological Development (FP7) and uses EIF's risk-taking capacity. It is part of, and complements, the existing Risk Sharing Finance Facility (RSFF), managed by the European Investment Bank (EIB).
Some 20 or so banks are expected to be involved in the RSI pilot phase, which is underpinned with €270 million from the FP7. The objective is to support €2.2 billion of additional loans for innovative SMEs and small midcaps in Europe. More details about RSI are available on: http://www.eif.org/what_we_do/guarantees/RSI/index.htm
BPI has been selected by the EIF following a call for expressions of interest from financial intermediaries for the RSI pilot phase.
BPI is the fourth major Portuguese financial group with a market share of 10% in deposits and loans and above 15% in asset management. It is one of the leading banks in the support of the most performing SMEs in Portugal in the framework of the several incentive programs made available by the Portuguese State to mitigate the impact of the economic crisis.