Direct RSFF Financing: Corporate Debt Financing (Senior Loans)
EIB loans in general are highly flexible and can have the following structural features:
- Lending maturities of up to 10 years (depending on the “economic” life of the project)
- Various repayment profiles (amortisation of loan principal during the loan life or at maturity (“bullet”), constant annuities or tailored installment)
- Possible initial reimbursement-free period of several years
- Various interest rate formulae (fixed, floating, revisable, convertible or tailored)
- Performance-based pricing schemes
- Secured or unsecured
- Structurally subordinated
- Availability of all standard currencies
EIB lending decisions are based on a bankability assessment - the borrower’s ability to repay the loan and interest.
Key assessment criteria are profitability, the soundness of the borrower’s (and/or guarantor’s) balance sheet and the ability to generate sustainable cash-flows.
General terms and conditions of EIB loans/guarantees:
- Maximum loan amount: up to 50% of eligible project cost
- Minimum loan amount: EUR 7.5m (smaller loans will preferably be handled through the Risk Sharing Instrument)
- Due diligence focuses on financial, technical, market & legal risks. EIB usually relies on own resources for due diligence projects;
- The loan approval process usually takes 3-6 months
- Loan pricing: commensurate to the level of risk assumed by the Bank, depending on the borrower’s financial standing and contractual terms and conditions agreed
- Fees: in accordance with the complexity of the transaction
Example of a project eligible for RSFF Corporate Debt Financing:
An automotive supplier company seeks financing to develop, at its own risk, a new emission filter for a car manufacturer.
Other RSFF Financing Products: