The signatures of three loan agreements worth EUR 885 million yesterday with the Undersecretariat of Treasury and a number of its long-standing banking partners mark a milestone for the EIB's lending activity in Turkey.

First, a EUR 335m facility has been signed with the Treasury, in support of public sector research activities. The facility will part-finance R&D activities performed by academic staff of the top 15 public universities in Turkey as well as the investments in scientific instruments and equipment required in all of the public universities of Turkey over the period 2008-2010.

Two further facilities have been put in place with some of EIB’s long-standing banking partners in support of their SME lending.

An EIB Loan for SMEs was concluded with TSKB, TKB and Vakifbank for a total amount of EUR 400m. TSKB is Turkey’s largest private development and investment bank in SME financing. TKB is the state development bank whose primary objectives include the provision of financing to the less developed regions of Turkey. Vakifbank is one of the leading banks in Turkey with an extensive nationwide coverage through its 529 local branches.

The EIB also entered into a loan agreement in support of SME lending with Halkbank, signing a first EUR 150m tranche of a total facility of EUR 300m. Halkbank is one of the most prominent SME banks in Turkey with a particularly strong reach at the level of the smaller enterprises.

Undersecretary Ibrahim H. Canakci, who signed the Academic Research Facility on behalf of the Treasury, by underlining the increasing project portfolio financed through EIB loans in wide spectrum of sectors, expressed that EIB’s contribution for innovation and scientific activities in Turkey are welcomed. He also mentioned that while SMEs are suffering further from lack of finance because of the financial turbulence, EIB’s support in SME investments and working capital needs is highly appreciated.

Commenting on the deals, EIB Vice-President Matthias Kollatz-Ahnen said: "Our support to the Academic Research Centres forms part of the Bank’s initiatives aimed at strengthening the Knowledge Economy, in particular investments in R&D, education and training to underpin the long-term growth potential of Turkey. At the same time the EIB is reinforcing its support to SMEs as they have been particularly hard hit by the evolving economic crisis. The facilities we have signed today with our banking partners are the first ones in Turkey to be based on the new EIB instrument for SME lending, which enables to finance a larger share of the SME investments and to accommodate their working capital needs, which are particularly important in the current economic downturn.”

The facilities with the banks were signed with Messrs Halil Eroğlu, President and CEO of TSKB; Ms Cansel Inankur, Deputy General Manager of TKB; Tanju  Yuksel and Doğan Pençe of Vakifbank and Mr Hüseyin Aydın, CEO of Halkbank.

The EIB is committed to supporting the development of Turkey’s economy to help to prepare the country for EU membership and has dedicated some EUR 3.7 bn to the real economy through intermediated loans over the last 10 years through an extensive network of more than 20 banks and leasing companies in Turkey. To access finance for SMEs and to check specific requirements, contact the local finance institutions directly. A full list of intermediaries is provided on the Banks’ web site

The Bank’s total investments in Turkey stand at EUR 10.9 bn including flagship projects like Marmaray, Istanbul underground metro, Istanbul earthquake risk mitigation, Turkey’s biggest windfarm Osmanye and Ankara-Istanbul high-speed train as well as numerous other infrastructure projects at the municipal level in the areas of urban transport, water and wastewater management in cities such as Bursa, Eskisehir, Antalya and Samsun.

Note to the editor:

The European Investment Bank (EIB), founded in 1958 under the Treaty of Rome establishing the European Community, is the European Union's bank for financing investments that further European integration. The main objective of the EIB is to contribute towards the integration, balanced development and economic and social cohesion of the Member States.

The European Investment Bank has opened its regional representations in Ankara and Istanbul last year.