Over EUR 200m will go to driving SME digitisation and innovative projects
The two institutions will support small and medium-sized enterprises by providing EUR 800m targeting micro-enterprises, start-ups and projects led by women in particular
The European Investment Bank (EIB) and Banco Sabadell have signed two agreements with a common objective: to provide funds for the self-employed, small and medium-sized enterprises (SMEs) and mid-caps in Spain to continue fostering economic growth and job creation in the country. Under these agreements, the two institutions will provide EUR 1bn to support SMEs that find it difficult to access finance due to their size or the sector they work in, and to promote their digitisation investments.
The two agreements have been implemented via an EIB participation in Banco Sabadell's first consumer loan securitisation fund. This is the first STS (simple, transparent, standardised) securitisation to have been placed on the Spanish market since the new EU regulation entered into force this year.
At the signature ceremony in Barcelona, EIB Vice-President Emma Navarro highlighted “the EIB's strong commitment to Spanish SMEs and mid-caps, which are key drivers of wealth and job creation in the country. Promoting their competitiveness by providing them with the resources they need to grow via investment in innovation and digitisation is one of the EIB Group's main priorities in Spain. With these agreements, the EIB will be able to support businesses that come up against the most obstacles when accessing credit, such as micro-enterprises and entrepreneurs. It is yet another example of how the advantages of EIB financing can reach the projects of these businesses too.”
Banco Sabadell Managing Director Jaime Guardiola made the following comment on the agreement: “Our vocation as a corporate bank means working with SMEs and small-scale entrepreneurs as much as we do with large companies. To this end, agreements like the one we are signing today are a key tool for Banco Sabadell, which from the very beginning has helped with small projects on the path to growth.” Guardiola also said that “much of the financing will go to digital transformation and innovative projects, which are both key focal points for the future of our businesses.”
Support for companies finding it hardest to secure finance and promotion of digitisation
Of the funds that the EIB and Banco Sabadell will provide under these agreements, EUR 800m will be granted to the self-employed, SMEs and mid-caps on favourable conditions, in terms of both interest rates and maturity periods. Particular attention will be paid to the financing needs of micro-enterprises with fewer than ten employees, start-ups and small investment projects led by women. To this end, the EIB has provided Banco Sabadell with EUR 400m in financing, to which it will add a further EUR 400m of its own resources. A total of 3 500 businesses will be able to benefit from this initiative.
At the same time, up to EUR 200m will go to promoting innovation for the self-employed, SMEs and mid-caps that can prove their business or project focuses on innovative domains. Here, the EU bank has granted EUR 100m to Banco Sabadell, which it will match with a further EUR 100m of its own.
The maximum project cost for accessing financing from either of the EIB-Sabadell credit lines will be EUR 25m for SMEs and EUR 50m for mid-caps. The financing can cover the entire investment for projects of up to EUR 12.5m.
This is the EIB's sixth agreement with Banco Sabadell under the EU bank's dedicated credit line for small and medium-sized enterprises. The last agreement – signed in 2018 – made it possible to provide over EUR 800m benefiting around 1 600 companies. The EIB and Banco Sabadell have signed credit lines totalling more than EUR 4bn for financing Spanish businesses since 2011.
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The EIB is providing the Institut Catalá de Finances (ICF) with a loan of up to EUR 250 million to support SMEs, the companies most vulnerable to the COVID-19 shock. The two institutions have signed the first EUR 150 million instalment of this financing agreement under an accelerated approval procedure put in place by the EIB in this emergency to ensure that the funds reach Spanish firms as quickly as possible. This is one of the first operations mounted under the EIB’s EUR 5 billion programme to safeguard European businesses in the face of the coronavirus crisis.