Skip to navigation

Skip to content

Structured Finance Facility

Date: 08/08/2008

The SFF was established in 2001 to generate significant value added by the provision of additional support for priority projects through instruments with a risk profile that is higher than the standard normally accepted by the Bank. 

Total reserves of EUR 750m were set aside under this heading and fully allocated between 2001 and 2006 for the purpose of generating operations totalling between EUR 1.5 and 2.5bn, providing a broad mix of financial products:

  • senior loans and guarantees incorporating pre-completion and early operational risk;
  • subordinated loans and guarantees ranking ahead of shareholder subordinated debt;
  • mezzanine finance, including high-yield debt for SMEs that are growing into larger industrial companies or undergoing restructuring;
  • project-related derivatives.

In 2006, the EIB’s Board of Governors decided to consider incremental increases in the SFF Reserve when required up to a maximum ceiling of EUR 3 750m until 2013, to support own resource activities in countries in which the Bank is authorised to operate. An immediate additional capital appropriation of EUR 500m was approved in 2006, bringing the total funded amount of the SFF Reserve to EUR 1 250m.

The strategic objectives established by the Bank include the creation of a significant and sustainable SFF programme, transforming the activities in question into a “mainstream” element of the Bank’s lending, with the emphasis on the high-priority sectors of TENs, i2i, energy and cooperation in partner countries. The SFF may nevertheless also be used for other priority objectives where appropriate, such as SMEs.

The Bank’s increased focus on the SFF, supported by the relevant organisational restructuring in its operational directorates, has already resulted in accelerated growth in signatures under the facility and the generation of a substantial project pipeline, in particular during 2007.

In June 2008, the central role of this Facility was acknowledged by the EIB’s Governors, who approved a further increase of EUR 1.5bn in the level of the SFF Reserve. This additional allocation is necessary to meet the Bank’s capital requirements to support its SFF activity through to 2009 and 2010. The replenishment of the SFF Reserve leaves a balance of EUR 1bn available for future allocations under the EUR 3.75bn SFF.