SAB KOMMUNALE ENTWICKLUNG SACHSEN MBIL

Promoter – Financial Intermediary

SAECHSISCHE AUFBAUBANK - FOERDERBANK

Location

• Germany

Description

The operation consists in a Multiple Beneficiary Intermediated Loan (MBIL) to the public regional promotional bank Saechsische Aufbaubank (SAB) to support its promotional lending to municipalities and other public sector entities, including their subsidiaries as well as small and medium sized enterprises (SMEs) and mid-caps in the Free German State of Saxony.

Additionality and Impact

The proposed Project aims to finance electricity and district heating networks, water supply, wastewater collection and treatment and public transport projects in Germany, therefore supporting the EU's priority in the energy, water and mobility sectors and the EIB's climate action and environmental sustainability objectives.

The green window of the operation supports Germany's Long-Term Climate 2050 Strategy set out in the National Energy and Climate Plan (NECP), the regional system development strategy for East Germany, as well as EU energy objectives including REPowerEU.

The Project addresses the EU and EIB public policy objectives of Cohesion (73% of loan amount expected to go to Cohesion areas) and of Climate Action and the Environment (20% of the MBIL expected to support environmental protection, climate change mitigation and/or adaptation).

It addresses the following market failures:

·      under-provision of public infrastructure and services, which have positive economic externalities (on education, health, environment, air & water quality);

·      access to finance for SMEs and Midcaps, especially in weaker cohesion regions.

The Project will increase access to finance and improve financing conditions for final beneficiaries (public sector entities, public utilities and companies, private sector SMEs and Midcaps), leading to a sustainable economic development in the Land Sachsen by improving the environment and employment levels. The selected intermediary SAB is well-known to the Bank from previous operations and the Land Sachsen offers a sound and stable operating environment.

In financial terms, the EIB loan will provide SAB with the opportunity to diversify its long -term funding sources at attractive financial terms and conditions (i.e., long term and grace period, low commitment fees, flexibility in drawdowns).

In non-financial terms, the EIB Loan will allow SAB to increase its capacity to measure and record its lending for Climate Action, including Mitigation and Adaptation.

 

Objectives

The aim is to support sustainable growth in the Free State of Saxony which is largely an EIB Cohesion Priority Region by financing small/medium projects carried out by the target beneficiaries mentioned above.

Sector(s)

• Energy - Electricity, gas, steam and air conditioning supply
• Water, sewerage - Water supply; sewerage, waste management and remediation activities
• Transport - Transportation and storage
• Credit lines - Credit lines

Proposed EIB finance (Approximate amount)

EUR 150 million

Total cost (Approximate amount)

not applicable

Environmental aspects

Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.

Procurement

Final beneficiaries will be requested to comply with applicable national and EU legislation, as appropriate.

Status

Signed - 23/07/2024