Portugal: EIB and BES step up lending for SMEs
The European Investment Bank (EIB) and Banco Espírito Santo (BES) have signed a EUR 200 million loan agreement for financing small and medium-sized projects mainly undertaken by SMEs and midcaps. Portugal is currently implementing a demanding austerity programme that must be accompanied by measures to boost growth and employment.
EIB Vice-President Magdalena Álvarez said at the signing ceremony: “the EIB is delighted to sign this loan, which is an immediate demonstration of the value of the Portfolio Guarantee signed with the Portuguese Republic. It will provide small businesses with access to credit on favourable terms, hence fostering growth and employment, which are much needed in the current economic environment”.
BES’s CEO António Souto added that “this instrument is especially important to BES because it will enable us to finance small and medium-sized enterprises, particularly innovative and exporting firms, and take forward our strategy of supporting Portugal’s business fabric”.
This loan is an example of the ongoing fruitful cooperation between the EIB and BES and follows on from the signing of the guarantee contract between the EIB and the Portuguese Republic, which is designed to ease banks’ access to the EIB’s facilities.
Implementing this agreement will enable BES to join forces with the Portuguese Government and the EIB to step up the financing of the Portuguese economy by supporting small businesses. There is also provision for the loan to be combined with the risk sharing instrument managed by the European Investment Fund (EIF) on behalf of the EIB in cooperation with the European Commission.
Drawing on EIB funds for SMEs and small midcap projects, the loan may also be used to provide small businesses with a stable working capital base.
This EIB credit line will mainly be used to finance small-scale projects in the areas of industry, tourism and services, including research and innovation, energy and environmental protection. Eligible projects will principally be located in Portugal’s convergence regions, so contributing to economic and social cohesion. This loan has been granted as part of the EIB’s policy of supporting small and medium-sized enterprises by providing credit on preferential terms that BES will pass on to the end borrowers.