UC ENHANCED SME SUPPORT - EGF ABS

Promoter – Financial Intermediary

UNICREDIT SPA

Location

• Italy

Description

The operation consists of an European Guarantee Fund (EGF) guarantee instrument to a junior tranche of a Unicredit (UC) granular portfolio of loans to small and medium-sized enterprises (SMEs) in Italy.

Additionality and Impact

The proposed transaction consist of an EGF operation, in the form of a first loss piece guarantee on an SME and Midcap portfolio originated by Unicredit in order to support new lending to SMEs. Unicredit is a key counterpart to the Bank in many countries, a strong EU GSIB intermediary and a very experienced promoter in deploying EIB mandates. The quick mobilisation of SME financing is strategic considering their high contribution to the country's economic growth and to sustain employment. The proposed operation addresses a market failure related to SMEs access to finance in the aftermath of the Covid-19 pandemic. The operation is expected to mitigate the financial constraints for this market segment and help viable companies to sustain their economic recovery and to relaunch their business activity severely hit by the pandemic crisis. The operation also supports the strengthening of the EU's economic, social and territorial cohesion by tackling the disparities in the regional development and by helping companies located in less developed regions to grow there. Eventually, this will support the ultimate goal of regional policies, namely convergence, by raising employment levels and facilitating re-industrialisation.

Objectives

The operation aims at enhancing access to finance for the specific market segment. In detail, the transaction is an unfunded Asset Backed Securities investment, a delinked product aiming at relieving capital on existing loan portfolio, which will be redeployed into new financing.

Sector(s)

• Credit lines - Credit lines

Proposed EIB finance (Approximate amount)

EUR 128 million

Total cost (Approximate amount)

EUR 1260 million

Environmental aspects

The EIB will require that UC take all the required measures to ensure that final recipients (SMEs) meet the EIB's environmental standards and related EU/national legislation.

Procurement

The EIB will require that UC take all the required measures to ensure that final recipients (SMEs) meet the EIB's procurement standards and related EU/national legislation.

Status

Signed - 9/06/2022