CAIXABANK RISK SHARING SMES AND MIDCAPS III

The transaction consists of a de-linked risk sharing guarantee between CaixaBank and the EIB, aimed at creating additional lending capacity to small and medium-sized enterprises (SMEs) and mid-caps in Spain. The guarantee facility will be used to cover up to 50% of the credit risk associated with a Spanish bank's corporate and midcap loan portfolio. Additionally, it will include a window targeting the agricultural sector.

The aim is to promote and accelerate private sector investments, and facilitate access to finance for SMEs and Midcaps, a backbone in terms of growth and employment for the Spanish economy. A portion of the operation will be dedicated to support SMEs and Midcaps operating in the agricultural sector.

The proposed transaction consists of a delinked risk sharing guarantee between CaixaBank and the EIB, under a partial delegation approach. The guarantee aims to promote and accelerate private sector investments as well as facilitating access to finance for SMEs & Midcaps, a backbone in terms of growth and employment for the Spanish economy. The operation will help address the working capital, liquidity needs and investment constraints of SMEs & Midcaps, a segment that remains vulnerable in the current challenging economic environment. 20% of the operation will be dedicated to SMEs & Midcaps operating in the agricultural sector. Contribution to cohesion is expected to be high (63%), thanks to the weight of the agricultural sector, where allocations to these regions predominate (82%).

Risk Sharing operations allow financial intermediaries to reduce their risk weights, risk concentrations, their perception of risk and, more importantly, to create headroom in their balance sheets to provide more lending. This is crucial in a context where banks have more restrictions to increase their balance sheet.

Supporting agriculture and bioeconomy is one of the eight policy priorities of the Bank, as per the EIB Group 2024-2027 Strategic Roadmap. The operation will support among others modernisation in the agriculture sector and rural development and territorial cohesion. It also aligns with the Common Agricultural Policy (CAP) legislative package for the 2023-2027 programming period.

This operation will address market weaknesses and failures related to the availability of financing to SMEs & Mid-caps active in the bioeconomy value chains. For such SMEs, this project will ease the financial constraints that arise from information asymmetries caused by the lack of track record, insufficient farm net asset value to collateralize, as well as high screening costs for small investments. 

The operation thus falls under the EIB's vertical Public Policy Goal (PPG) of "SME and Midcap financing" on an 80% of the portfolio and within PPG "sustainable energy and natural resources" for the 20% committed to Bioeconomy.

The operation falls within the scope of the EIB's Environmental and Social Standards - "Standard 11 Intermediated Finance". The Financial Intermediary has adequate capacity, systems and processes in place for identifying, assessing, managing and monitoring environmental, climate and social (ECS) risks related to the potential sub-projects benefitting from EIB support. The Final beneficiaries will be required to comply with applicable national and EU legislation in respect of environmental and social matters, as appropriate.

In accordance with the EIB's policy to ensure that sub-loans comply with the EU acquis, in particular in the fields of environment and public procurement, CaixaBank has to to take all the requisite measures to ensure that the environment and procurement procedures carried out by the Final Beneficiaries, will comply with the relevant EU legislation and the applicable national legislation, provided that these are in line with EU rules.