The European Investment Bank today signed its first “loan for SMEs” in Denmark with Ringkjøbing Landbobank A/S (RL) for a total of EUR 50 million. Documentation was signed in Luxembourg by Mr Plutarchos Sakellaris, EIB Vice-President, and Mr John Fisker, RL’s General Manager.
The funds will be used for small and medium-sized enterprises (SMEs) operating in a variety of industries and services, including renewable energy (wind turbines).
Mr Sakellaris commented at the signing ceremony: "Support for small and medium sized businesses to meet the pressures of the global crisis is a priority for the European Union and the EIB, a priority expressed via every possible means. The EIB’s swift action to help SMEs in Denmark illustrates Europe’s determination to soften the impact of the credit crisis on the real economy as much as possible. Our action is amplified by the synergies with our partner Ringkjøbing Landbobank”.
Mr Fisker stated: "Ringkjøbing Landbobank has for a number of years been an EIB partner. This has made it easier for us to grant long-term loans to SMEs, including loans for the financing of wind turbines. Ringkjøbing Landbobank has been very pleased with and proud of the cooperation with the EIB, and we regard the new loan as marking a further step in that cooperation".
Background information:
In the prevailing economic context the European Investment Bank Group, the banking group promoting European objectives, stepped up its activities in 2008 in accordance with European Union decisions.
The EIB is promoting economic recovery in the European Union as a whole and Denmark in particular in line with the EU Council and ECOFIN strategy. The Bank’s action through increased lending is targeted at the real economy in a sustainable manner via three main areas: SMEs; climate change (including research, development and the production of "clean" cars); and investment in the less well-off ‘convergence' regions of the EU.
Total EIB lending increased by 21% in 2008 to EUR 57bn, compared to EUR 48bn in 2007. Loan signatures rose sharply towards the end of the year, reflecting the EIB's swift response to help underpin economic recovery at the request of the European Union's Member States.
The EIB committed itself last September to boosting SME financing to help smaller businesses weather the financial and economic storm. As a result, the Bank signed loans for SMEs worth EUR 8.1bn last year – more than half of this in the fourth quarter alone – against EUR 5.7bn in 2007, while also making the lending process simpler, more flexible and more transparent.
At the same time the European Investment Fund, the EIB Group's specialised financing arm for small businesses, provided commercial banks with EUR 2bn in loan guarantees for SME lending and invested more than EUR 400m in venture capital funds.
To finance its activities, the EIB raised an aggregate EUR 60bn on international capital markets through 247 bond issues in 22 currencies, including four currencies in synthetic format. Outstanding loans at end-2008 totalled EUR 350bn.
Over the past three years the EIB has provided two loans in support of SMEs in Denmark for a total of some EUR 100m equivalent.
Over the five-year period 2004-2008, the European Investment Bank provided EUR 1.9bn for projects in Denmark, with industry and services accounting for 41% of the total, for the production of equipment, chemicals and consumer goods, mainly for research and development, as the country has a very forward-looking private sector.