• The programme worth PLN 2.5bn (EUR 575 million) is the biggest ever securitization in the Polish market
  • Through the joint involvement of European Investment Bank and European Investment Fund, the EIB Group will subscribe PLN 1.54bn (EUR 355 million) of notes, partially guaranteed by the Juncker Plan’s European Fund for Strategic Investments
  • The funding and capital relief generated will enable PKO Leasing to continue increasing its leasing activity and support small and medium-sized businesses

PKO Leasing (PKOL), the largest leasing company in Poland, launched today with the support of the EIB Group the largest ever securitization transaction on the Polish market. As a result, PLN 2.5bn of asset-backed securities will be sold to a pool of international investors, which includes the EIB Group, Citi Handlowy and other European investors.

The European Investment Bank (EIB) will subscribe to PLN 900m (EUR 208m) of Senior Notes under own risk and PLN 640m (EUR 148m) of Mezzanine Notes under the guarantee provided by the European Fund for Strategic Investments (EFSI), the financial pillar of the Investment Plan for Europe, or Juncker Plan. The Senior and Mezzanine Notes will be backed by a pool of assets consisting of leasing receivables originated by PKOL in the course of its ordinary business in Poland. Scope Rating and ARC Rating has provided public ratings of both the Senior and Mezzanine Notes.

The European Investment Fund (EIF), part of the EIB Group, is participating in the transaction as a guarantor of PLN 390m (EUR 90m) of Senior Notes and in addition, given its technical expertise in structured finance transaction, it will act as an advisor to EIB for both the senior and the mezzanine investments. 

The transaction will contribute to improving access to finance for Poland’s micro-enterprises, SMEs and Mid-Caps across all the economy sectors. The EIB’s participation in both tranches is expected to result in PLN 4,360m (EUR 1,006m) of new financing to be allocated in line with EIB’s requirements under this operation, thereby substantially supporting the Polish economy.

The proposed operation would be the first Simple, Transparent and Standardised (“STS”) [1] eligible transaction in Poland and one of the first STS eligible operations subscribed to by EIB.

Paweł Pach, CEO of PKO Leasing said: “As the market leader, we aspire to be the standard-setter not only in meeting the needs of Polish businesses, but also in building a long-standing position on the European financial markets. The transaction volume, low funding costs, high ratings and the STS status are all a testimony to PKO Leasing’s high credibility among international investors.”

Vazil Hudak, EIB Vice-President in charge of operations in Poland, said: “This landmark transaction is a confirmation of the EIB Group’s support to the securitisation market in Poland and to the growth of small and medium-sized businesses. Thanks to the guarantee provided by the Juncker Plan and by acting jointly with other international investors, we could help PKO Leasing increase the size of the transaction: this is testimony of the attractiveness of the Polish economy”.

Pierluigi Gilbert, EIF Chief Executive, added: “As banks and leasing companies increasingly turn to international investors to place asset-backed securities, more funding is made available to the Polish economy. Small and medium-sized companies can take advantage of an easier access to finance and confidently develop their business plans”

Elżbieta Bieńkowska, European Commissioner for Internal Market, Industry, Entrepreneurship and SMEs, said: “This agreement will make a big difference for thousands of emerging and growing businesses in Poland in need of financial support. Under the Juncker Plan, already more than 55,000 Polish SMEs and start-ups are benefitting from improved access to finance. SME employment in the EU is on the rise and we need to continue to give a helping hand so that these small companies flourish and create more jobs.”

Summary of the transactions:

On the 26th September 2019, Polish Lease Prime DAC (the "Issuer") issued (i) PLN 1,290,000,000 Class A-1 Floating Rate Secured Notes due 2029 (the "Class A-1 Notes"), (ii) PLN 545,000,000 Class A-2 Floating Rate Secured Notes due December 2029 (the "Class A-2 Notes") and (iii) PLN 640,000,000 Class B Floating Rate Secured Notes due December 2029 (the "Class B Notes" and, together with the Class A-1 Notes and the Class A-2 Notes, the "Notes"). 

The Notes were all issued at 100% of their issue price. Class A-1 Notes and Class A-2 Notes are Senior Notes. Class B Notes are Mezzanine Notes.

The EIB Class A-1 Notes bear interest at a rate of three-month WIBOR plus a margin of 0.70 per cent and Class B Notes a margin of 2.5 per cent.

Under the terms and conditions set out in the note purchase agreements entered into on the 24th September 2019 between the EIB, the Issuer and PKOL, the EIB:

(i) purchased on the 26th September 2019 a portion of the Class A-1 Notes from the Issuer; and furthermore

(ii) will purchase (subject to satisfaction of conditions precedent and as further described in the note purchase agreement) on the 28th February 2020 the Class-B Notes from PKOL (issued by the Issuer and purchased by PKOL on the 26th September 2019 at their issue price of 100%) at a price of 100% of the Notes’ then principal amount outstanding.

[1] STS is part of the European Commission’s regulation 2017/2402 in pursuit of completing the European Capital Markets Union (“CMU”). Further information can be found on the homepage of the European Securities and Markets Authority (“ESMA”): https://www.esma.europa.eu/policy-activities/securitisation/simple-transparent-and-standardised-sts-securitisation.