The European Investment Bank (EIB) is lending EUR 85 million for upgrading of the municipal infrastructure of Brno, the second largest city in the Czech Republic.

The loan will be used to co-finance small and medium-scale urban development projects which reflect the EIB's focus on urban renewal and are in line with the priorities set in the medium-term capital investment programme of the City of Brno. The selected projects will be concentrated on rehabilitation and upgrading of the city's infrastructure, in accordance with the municipality's Strategy for the City, 2020, to promote economic development and urban regeneration. For example, the City of Brno will use the EIB loan to finance the reconstruction of Námestí Svobody (Liberty Square) and the Janácek Theatre, the most important theatre in Brno; the renovation of the New Town Hall; and the reconstruction of the Tugendhat Villa, a UNESCO World Cultural Heritage Site representing one of the most significant architectural masterpieces of the 1920s, as well as the Tuhackova Elementary School.

Mr Ivan Pilip, the EIB Vice-President responsible for the Bank's operations in the Czech Republic, Poland and Slovakia, commented: I am pleased that the EIB loan signed today will provide Brno, the second largest Czech city, with direct access to EIB funds as an additional source of finance. The EIB lending, combined with grants received from the EU Funds, will help the municipal authorities to implement projects that contribute to improving the quality of life in a city and region where the Bank is becoming increasingly involved.

Since 1990 the EIB, as the European Union's long-term financing institution, has provided more than EUR 6 billion for projects furthering economic modernisation and restructuring of the Czech Republic. The loan provided to Brno is the EIB's third major lending to a Czech municipality, following Prague and Pilsen.

The Bank finances public and private investment projects in the Czech regions that are relevant for their economic development and strengthening their competitiveness. EIB lending provides the municipal and/or regional authorities with access to the Bank's funds on favourable terms, thanks to the EIB's AAA credit rating.