The European Investment Bank (EIB) has concluded a further global loan for EUR 100m with BayernLB to enable it to provide low-interest investment finance, particularly to SMEs and municipalities, with immediate effect. The funds are to be used to part-finance projects in the areas of energy efficiency, environmental protection, sustainability and climate change mitigation. The EIB’s contribution may cover up to 50% of the overall cost, which must not exceed EUR 25m, the balance being financed from the beneficiaries’ own resources or through external borrowing from BayernLB.
The EIB funds may be advanced to both private and public customers, with maturities of up to 20 years depending on the type of project. The lending conditions are attractive because the EIB is able to raise funds on favourable terms on the capital markets owing to its excellent rating. BayernLB will pass this advantage on to its customers in the form of low funding costs, so that the overall financing package will be provided at lower interest rates.
The investment projects must comply with the EIB’s funding guidelines, defined in accordance with Bank’s priorities "environment sustainability and climate change mitigation”, “energy production, transport and storage” and “sustainable community development”. Eligible projects include, for example, investments that result in a considerable reduction in a company’s energy consumption or in the expansion of public transport services in urban areas. BayernLB’s experts first examine whether a project is suitable and then develop a financing scheme. A special feature of EIB funding is that investments can be supported in all the countries of the European Union (EU).
At the signing of the contract, Wilhelm Molterer, Vice-President of the European Investment Bank whose responsibilities include financing operations in Germany, stated, “With this loan, the European Investment Bank is combining two of its operational priorities: the provision of urgently required loans to SMEs and the financing of environmental protection and sustainability. European networking also has a key role to play in making Europe more competitive. This applies to both to energy transfers and to communications and transport infrastructure. I am pleased that, together with our long-standing partner BayernLB, we can also make these areas more attractive for SMEs.”
“BayernLB is one of Germany’s leading financing specialists. In cooperation with the Bavarian Savings Banks and also in direct operations with businesses and municipalities, we are using promotional funds as an attractive financial building block, thus providing our customers with real value added. At the same time, we are helping to further important social objectives such as the transition from fossil fuels in Germany. We have been working closely together with the European Investment Bank for many years," said Jan-Christian Dreesen who is responsible for business with corporate customers on BayernLB's Management Board.