The European Investment Bank (EIB), the European Union's financing institution, has concluded an agreement on participation in a fund promoted by Dresdner KB Private Equity in Italy with an investment of EUR 25 million. This is the EIB's first operation in Italy involving participation in a fund promoted by a foreign operator and managed by an Italian team. The agreement was signed just a few days after the meeting of the European Council in Lisbon, at which the EIB reaffirmed its previous commitment (Amsterdam and Cologne Summits) to providing support in the fields of venture capital, SMEs, health, education and urban renewal.

Dresdner Kleinwort Benson Fund Italia L.P. will form part of a network of European regional closed-end funds available to institutional investors interested in pan-European operations. It will acquire holdings in Italian SMEs and be represented on their Boards of Directors. The beneficiaries of the fund's investments will be SMEs with skilled and competent managers, a sound market position acquired through product or process innovation and strong international growth potential.

The fund's promoter is Dresdner Kleinwort Benson Limited (DKB), London, a subsidiary of Dresdner Bank AG. DKB's Private Equity business unit is responsible for venture capital operations throughout the world.

Launching its activities last week, the fund aims to mobilise EUR 100 million by September 2000. Typical operations will consist of investments of around EUR 5 to 10 million in companies with a turnover of between EUR 25 and 250 million.

The EIB finances capital investment furthering EU integration, particularly in the fields of regional development, trans-European transport, telecoms and energy networks, industrial competitiveness and integration, SMEs, environmental protection and security of energy supplies. Outside the Union, it operates within the framework of the EU's development aid and cooperation policies. The EIB, whose shareholders are the EU Member States, raises its resources on the capital markets, where its first-class (AAA) credit rating enables it to obtain the finest terms.Designed to foster job creation, the Amsterdam Special Action Programme (ASAP) includes a special window for financing venture capital operations in favour of high-growth SMEs. It also provides for the Bank to extend its activity in the new fields of education, health and urban renewal and step up its lending in support of trans-European networks and other infrastructure schemes. In June 1999, the EIB decided to double its funding for the European Technology Facility (ETF), managed by the European Investment Fund (EIF), from EUR 125 to 250 million, to double the reserve established to cover the risk associated with venture capital operations (from EUR 500 million to 1 billion) and, in principle, to allocate to this reserve in due course a further amount of EUR 1 billion for the period 2000-2003.

(1) EUR 1 = 1936.27 ITL; 0.621700 GBP.