The European Investment Bank, the long-term financing arm of the European Union (EU), announces a loan of EUR 100 million (1) to Fortis Bank designed specifically to finance the capital investment needs of smaller business in the agricultural, industrial and service sectors. This is the EIB's maiden intermediated operation with Fortis Bank under which the latter will make the proceeds of what is essentially a credit line available to eligible final beneficiaries. Fortis Bank thus becomes the most recent among a number of partner intermediaries which have already helped to deploy EIB global loans in Belgium, including the former Generale Banque (G Bank), Société Nationale de Crédit à l'Industrie (SNCI) and CGER.
The EIB's global loan facility is dedicated to financing SME capital projects undertaken principally within the European Union. Its attractiveness for smaller businesses lies in the highly favourable interest rate terms passed on to the end recipient via the local intermediary, in this case Fortis Bank, to further economically worthwhile ventures meeting the EIB's criteria. Successful take-up of the facility is evident from the extent of its popularity with this category of borrowers throughout the European Union: over the period 1995-1999, some 55 000 SMEs benefited from global loan finance totalling EUR 12.7 billion.
One of the distinguishing features of the present global loan to Fortis Bank is that it is not directed solely at supporting SMEs in the Benelux countries but can be used by the intermediary to fund meritorious projects in all the Member States provided that the investment complies with EU objectives. In other words, Fortis Bank can draw on this dedicated credit line to reach out to its entire SME clientele Europe wide.
(1) 1 EUR = 40.3399 BEF ; 0.618 GBP