EIB and ICO have launched an Investment Platform for mid-caps that will mobilise up to 1.12 billion euros of finance

25 enero 2019

  • The agreement allows ICO to increase its lending capacity to medium-sized companies.
  • The 200 million guaranteed by the EIB under a risk-sharing instrument is supported by the Juncker Plan.
  • Employment impact: the platform is expected to benefit companies, all of which employ around 26,000 people.

The European Investment Bank (EIB) and the Instituto de Crédito Oficial (ICO) are joining forces to mobilise up to 1.12 billion in financing for Spanish mid-caps (companies with between 250 and 3,000 employees). To this end, EIB's Vice-President, Emma Navarro, and ICO's President, José Carlos García de Quevedo, signed an agreement today in Madrid that will enable the creation of an Investment Platform specifically for these medium-sized companies through a risk-sharing instrument. The Platform will mobilise private capital through syndicated loan agreements with financial intermediaries.

Specifically, the EIB will assume half the risk of the portfolio of up to 400 million euros generated by ICO in cooperation with commercial banks, which, for their part, will contribute at least 50% of the financing. As a result, the volume of funding made available for mid-caps through this agreement will amount to 800 million euros. To this amount must be added the contribution of the mid-caps themselves, bringing the total amount of funding mobilised to 1.12 billion euros. This risk-sharing guarantee provided by the EIB has been signed under the Investment Plan for Europe. The support of the Juncker Plan allows for higher levels of risk-taking and improved financing conditions for mid-caps, which will benefit from longer repayment periods to develop their investments. Companies benefiting from this risk guarantee will be able to receive between 8 million and 12 million euros from ICO. 

The agreement aims to help Spanish mid-caps to have the necessary resources to lead investments in innovation and sustainability, enabling them to continue to grow and create jobs. The EIB estimates that the companies that can benefit from this Investment Platform collectively employ around 26,000 people.

At the signing ceremony in Madrid, EIB vice-president Emma Navarro, said: "This new Investment Platform is a great example of how the EIB-ICO partnership, with the support of the Juncker Plan, can develop innovative financial instruments capable of generating economic growth by mobilising private investment. We are pleased to sign a very positive agreement for the financing of mid-caps, which are key vehicles for employment generation and for boosting the productive capacity of the Spanish economy.

The President of the ICO, José Carlos García de Quevedo, said: "This agreement once again highlights the value of the combined work of both institutions and enhances ICO's role as a catalyst of EU funds to promote the growth of companies in Spain, thereby contributing to the generation and structuring of various sources of financing".

Jyrki Katainen, Vice-President of the European Commission, responsible for Jobs, Growth, Investment and Competitiveness, said: "Thanks to this investment platform, medium-sized Spanish companies will get the financing they need to grow and create jobs in the country. Attracting investment to boost employment in Spain and across Europe has always been a priority of the Investment Plan. I congratulate Spain for being among its main beneficiaries, having mobilised more than 46 billion euros of additional investment for its benefit.

The European Investment Bank (EIB) is the long-term financing institution of the European Union whose shareholders are its Member States. The EIB provides long-term financing to viable investment projects in order to contribute to achieving EU policy objectives.

The Investment Plan for Europe, known as the Juncker Plan, is one of the European Commission’s key priorities. It focuses on boosting investment to create jobs and growth through smarter use of financial resources, removing barriers to investment and providing visibility and technical assistance to investment projects.

The European Fund for Strategic Investments (EFSI) is the main pillar of the "Juncker Plan" which provides first loss guarantees, enabling the EIB to invest in more projects that often carry a higher risk. Concrete results from EFSI have already been observed. The projects and agreements approved for funding under the EFSI are expected to mobilise more than 371 billion euros in investments and support around 856,000 SMEs in the 28 Member States.