KOMERCNI BANKA LOAN FOR SMES AND MIDCAPS

This Multiple Beneficiary Intermediated Loan will support investments carried out by small and medium sized enterprises (SMEs) and mid-caps in the Czech Republic and Slovakia.

The objective is to improve access to finance for the target beneficiaries, with 15% dedicated to eligible projects under the Climate Action and Environmental Sustainability (CAES) financing window.

The operation will provide financing to Komercni Banka, a.s. ("KB") with the aim of generating additional lending to Czech and Slovak SMEs and Midcaps. KB has in-depth experience with implementing EIB products and a strong ambition to support green projects through its network of branches in the targeted regions.

The operation aims to help mitigate the market failure of SMEs' and Midcaps' insufficient access to long-term funding  thereby contributing to long-term economic growth. By addressing this market failure, the operation contributes in particular to the strengthening of the EU's economic, social and territorial cohesion (93.5% of it is expected to be implemented in cohesion regions). Furthermore, a moderate proportion (15%) of the financing is expected to be used in financing CA&ES projects.

The green window of the operation concerns the financing of renewable energy (mostly solar PV) projects in the Czech Republic and Slovakia. It contributes to supporting the Bank's priority objectives in the energy sector and the EIB's climate action and environmental sustainability objectives. The operation will contribute to energy production from low-carbon sources and reduction of energy demand in the Czech Republic and Slovakia, which is key to meeting the mid-/long-term national objectives, as outlined in the National Energy and Climate Plans of the respective countries (NECP). The operation is also aligned with the REPowerEU strategy. By using an intermediated approach, the Bank will be able to support smaller projects that would otherwise not be reached directly.

Moreover, the operation supports KB's sustainability strategy, by facilitating its lending in the targeted sectors and diversifying its financing sources. The operation addresses a number of market failures, from contributing to the reduction in carbon and air pollution to improving the efficiency and integration of energy markets.

The operation provides KB with significant value in the form of attractively priced funding with flexible repayment terms. The blending of EIB funding with KB's own resources will allow to offer more favourable financing conditions (longer maturities, lower and flexible rates) to final beneficiaries, thus improving their access to finance.

Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.

Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.