- This is the second covered bond operation carried out by the EIB in Italy since the new regulation came into force.
- 25% of the funds will be allocated to companies operating in regions concerned by the cohesion policy.
- Another 25% will be dedicated to innovative investments carried out by small businesses and mid-caps.
The European Investment Bank (EIB) and BCC Banca Iccrea, parent company of the BCC Iccrea Group, have signed an agreement that will help unlock more than €400 million of new finance for small and medium businesses (SMEs) and mid-caps. The operation, announced today in Rome by EIB Vice-President Gelsomina Vigliotti and Managing Director of BCC Iccrea Group Mauro Pastore, supports access to credit on favourable terms and aims to promote innovation and projects located in the South of Italy, reflecting the strong commitment of both institutions to promoting the digital transition and economic cohesion in the country.
The operation is structured around the EIB’s full private placement purchase of a new €200 million covered bond issued by BCC Banca Iccrea. To this end, BCC Iccrea Group is allocating an additional €200 million, meaning that a total of €400 million will go to the real economy. The covered bond has a maturity of seven years and a fixed rate yield of 3.433%, which in line with the latest issues of the parent company of BCC Iccrea Group.
The recipients of the new funding will be SMEs (up to 250 employees) and mid-caps (250 to 3 000 employees), which will be able to carry out new projects with a financial advantage derived from the competitive rates and long maturities provided by EIB loans. At least €100 million (or 25% of the total amount of the agreement) will be allocated to support innovative projects, and another €100 million will be dedicated to promoting projects in cohesion regions.
“Instruments such as covered bonds are a viable alternative to traditional financial products to channel investment towards key sectors of the economy. This operation with BCC Iccrea Group aims to promote innovation and cohesion simultaneously, as well as access to credit on favourable terms for businesses. We need to make full use of these resources to build a more prosperous and fairer future for all Italians,” said EIB Vice-President Gelsomina Vigliotti.
“This operation forms part of a regional support process that aligns with BCC Iccrea Group's recent issues in 2024 totalling €1 billion. Through these instruments we want to continue to send a strong signal of solidarity to our productive fabric and to support small businesses, ensuring not only a fair distribution of resources at national level, but at the same time promoting the digital transition of companies and fostering their competitiveness in the domestic and foreign market", said Managing Director of BCC Iccrea Group Mauro Pastore.
Background information
The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It provides long-term financing for sound investments that contribute to EU policy. The Bank finances projects in four priority areas: infrastructure, innovation, climate and environment, and small and medium-sized enterprises (SMEs). In the past five years, the EIB Group has provided more than €58 billion in financing for projects in Italy.
BCC Iccrea Group is the largest Italian cooperative banking group, the only national banking group with wholly Italian capital and the fourth-largest banking group in Italy by assets (with total consolidated assets of €175 billion at 31 December 2023). BCC Iccrea Group currently comprises 115 cooperative banks present in over 1 700 Italian municipalities with nearly 2 500 branches, and other banking, financial and related companies controlled by BCC Banca Iccrea. At 31 December 2023 and across Italy, the group's cooperative banks had net assets of around €91 billion and direct inflows of about €135 billion, with 5.2 million customers and some 850 000 members. BCC Iccrea Group is among the best banking groups for asset quality, with a CET1 ratio of 21.1% and a liquidity coverage ratio (LCR) of 265%. The group is a member of the Tertio Millennio ETS Foundation, a non-profit organisation established in 2002 that aims to promote exclusively social solidarity activities in Italy and abroad, particularly within the system of cooperative banks and rural credit banks.