Release date: 4 October 2022
Promoter – Financial Intermediary
BANCO SANTANDER TOTTA SALocation
Description
The project concerns a multi-beneficiary intermediated loan (MBIL) to provide additional loans to small and medium sized enterprises (SMES) and MidCaps in Portugal. In detail, the financial operation consists in purchasing investment grade tranches of a true sale securitistion of consumer loans.
Additionality and Impact
Given the current market conditions, the proposed operation would most likely not take place without EIB's participation, preventing the Portuguese economy from benefiting from new lending (through the New Portfolio).
By transferring the credit risk of the securitised portfolio, the proposed operation would reduce the risk-weighted assets of the Promoter. The capital relief provided would increase the Promoter's credit capacity and allow for the origination of new loans to Final Beneficiaries. Such additional lending is expected to enhance access to finance for Portuguese SMEs and Mid-caps at improved terms. The proposed operation addresses the market failure related to SMEs' and Mid-caps' access to finance while the overall economy is recovering from the negative impact of the COVID-19 pandemic and the current macroeconomic shocks due to the Ukrainian war and high energy costs, as well as inflation that continues to put the Portuguese companies under stress.
A significant portion of the New Portfolio is expected to be located in Cohesion Regions. The operation will thus also contribute to the European Union priorities on convergence and social cohesion, helping reduce regional disparities.
This operation will respond to the suboptimal investment situation in the securitisation market. The securitisation market has been slowly recovering from the relatively low volumes experienced during the COVID-19 crisis. Unlocking and reactivating this market through EIB participation is critical to allow banks to continue lending to SMEs and Mid-caps.
Objectives
The loan will be used for the financing of small and medium-sized investment projects in eligible industry and services sectors. A minimum 70% of the loan will be used to finance SMEs.
Sector(s)
- Credit lines - Credit lines
Proposed EIB finance (Approximate amount)
EUR 410 million
Total cost (Approximate amount)
not applicable
Environmental aspects
The projects financed under this operation will need to comply with domestic and EU applicable legislation, as appropriate.
Procurement
The projects financed under this operation will need to comply with domestic and EU applicable legislation, where applicable.
Status
Signed - 28/09/2022
Disclaimer
Before financing approval by the Board of Directors, and before loan signature, projects are under appraisal and negotiation. The information and data provided on this page are therefore indicative.
They are provided for transparency purposes only and cannot be considered to represent official EIB policy (see also the Explanatory notes).