Release date: 12 November 2020
Promoter – Financial Intermediary
BANCA MARCH SA
Operation under the European Guarantee Fund (EGF) to support Spanish mid-caps and large corporates in sectors that are in line with the EIB's long-term mission (innovation, environment and indirect support for small and medium-sized enterprises (SMEs)) affected by the COVID-19 pandemic. The operation falls under the EGF - EU PL RISK SHARING INSTRUMENT (2020-0618) Programme Loan.
The project consists of an unfunded risk participation scheme under a full delegation approach by which the EIB will cover up to 75% of the losses with respect to each defaulted loan of a non-granular portfolio of corporate and mid-cap loans. While access to finance had somewhat improved since the financial crisis, it has become a critical issue again as a result of the COVID-19 crisis, due to both rapid demand and rising constraints on the side of intermediary banks. These constraints are idiosyncratic and only partly addressed, e.g. through measures of the ECB, which is providing unprecedented amounts of liquidity support in euro-area countries. A pressing constraint for financial intermediaries is lending capacity, particularly as the economic crisis will lead to substantial downgrades in their existing lending books and corresponding increases in their minimum capital requirements. This leads to a vicious circle of a pro-cyclical shift of remaining lending capacity into "lower-risk" assets, which was a main contributor to the last financial crisis. Therefore, the objective of the operation is to provide liquidity and financing for projects to mid-size and large companies within the context of the COVID-19 pandemic.
- Credit lines - Credit lines
Proposed EIB finance (Approximate amount)
EUR 200 million
Total cost (Approximate amount)
EUR 653 million
Signed - 23/12/2020
Before financing approval by the Board of Directors, and before loan signature, projects are under appraisal and negotiation. The data provided on this page is therefore indicative and cannot be considered to represent official EIB policy (see also the Explanatory notes).