The €25 billion guarantee fund will be funded by EU Member States pro rata to their shareholding in the EIB and/or other institutions.
Thanks to the guarantee, the EIB Group will be able to provide existing products to local banks and other financial intermediaries, who are in close contact with businesses in all Member States and can unlock financing to the real economy, without risking financial instability.
The guarantee will support different types of operations of the European Investment Bank, and its subsidiary, the European Investment Fund.
- By guaranteeing parts of portfolios, our operations under the guarantee fund will free up capital for the financial intermediaries involved to make more financing available.
- At least 65% of the financing is earmarked for small and medium sized businesses.
- Up to 23% will go to companies with 250 or more employees, with restrictions applying to companies with more than 3 000 staff.
- Up to 5% can go to public sector companies and entities active in the area of health or health-research or providing essential services related to the health crisis.
- Up to 7% can go to venture and growth capital and venture debt.
The guarantee fund will provide guarantees to the EIB and EIF to reimburse any possible losses incurred for included operations. By pooling credit risk across all of the European Union, the overall average cost of the fund will be significantly reduced, compared to national schemes.
The use of the EIB also means that all Member States will benefit from the sharing of the bank’s top-level credit rating.