The European Investment Bank (EIB), the long-term financing institution of the European Union (EU), announces a global loan for EUR 120 million (ESP 20 billion)(1) to Caja de Madrid and its subsidiary, Corporación Financiera Caja de Madrid S.A., for financing small and medium-scale investment schemes undertaken by SMEs and local authorities.
In granting this loan, the EIB took account of the substantial demand for such credit and the rapid deployment of the initial global loan made available to this financial intermediary in 1999. Caja de Madrid has branches throughout Spain, although around 60% of its business is concentrated in the Madrid region.
This EIB credit line will enable Caja de Madrid to augment its supply of medium and long-term loans for small and medium-scale investment in the industrial, agro-industrial, tourism and service sectors, as well as in health and education facilities. It may also be used to finance small and medium-scale environmental infrastructure schemes such as wind farms, combined heat and power projects, small hydropower plants, implemented by private promoters or municipal authorities.
The EIB was created in 1958 by the founding treaty of the European Economic Community, the Treaty of Rome. It was set up to contribute to the integrated and balanced development of the Member States, as well as to their economic and social cohesion, by providing long-term finance for capital investment fulfilling EU objectives.Devised by the Bank in 1968, global loans are employed by the EIB to finance small and medium-scale ventures. They are essentially lines of credit opened with banks and other national, regional and local financial intermediaries, which deploy the proceeds in the form of sub-loans targeted in favour of small and medium-scale investment schemes meeting the EIB's eligibility criteria.
(1) EUR 1 = ESP 166.386; GBP 0.621700.