EIF supports LfA Förderbank Bayern in expanding a guarantee programme for small and medium companies

• LfA Förderbank Bayern has signed up for a capped counter-guarantee from the European Investment Fund.
• The transaction is enabled by the European InvestEU program and focusses on SME Competitiveness, Sustainability and Innovation and Digitalisation.
• EIF’s total commitment of €13m will enable regional banks to support SME financing of up to €400m.

Luxemburg/Munich, 16 October 2024: LfA Förderbank Bayern (LfA) will increase its guarantee-support for regional financial institutions that want to provide financing to small and medium-sized enterprises (SMEs). The European Investment Fund (EIF) supports this programme by providing a capped counter-guarantee with a total commitment of €13 million targeted to SMEs and small mid-caps in Bavaria. This commitment will enable LfA, owned by the German free-state of Bavaria, to support SME financing provided by regional commercial banks of up to €400 million.

The EIF guarantees are made possible by the European InvestEU programme, making use of three of its guarantee products: the Competitiveness & Growth product, the Sustainability & Green Transformation product, and the Innovation & Digitalisation product.

• The EIF SME Competitiveness Guarantee is designed to support small and medium companies by facilitating access to finance to riskier SMEs and companies lacking sufficient collateral.
• The EIF Sustainability Guarantee aims to support the green and sustainable transformation of the economy, and the uptake of environmentally friendly, green and inclusive investments by small companies.
• The EIF Innovation and Digitalisation Guarantee will enable regional banks to support innovation and the growth of small and medium companies working in research and development, and or the adoption of new digital technologies.

The EIF-backing also translates into preferential financing conditions for the benefit of SMEs and small midcaps, enabling their investments into sustainability and innovation.

“The InvestEU programme is proving to be a very useful tool to support European businesses”, said Marjut Falkstedt, Chief Executive of the European Investment Fund, “Through this collaboration with LfA Förderbank Bayern, we look forward to making financing more accessible for companies across Bavaria to put them on a more sustainable and competitive footing, while also enabling innovation and their transition to a more digital future.”

Dr Bernhard Schwab, Chairman of the LfA Management Board, said: “Transformation, in particular towards digitalisation and technological advancement, will be the overarching task for the economy in the coming years – entailing huge investment needs. I am therefore delighted that, in cooperation with the European Investment Fund, we can now support even more Bavarian SMEs in financing investments in innovation and digitalisation.”

Background information:

The European Investment Fund (EIF) is part of the European Investment Bank (EIB) Group. Its central mission is to support Europe’s micro, small and medium-sized enterprises (SMEs) by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment. In this role, the EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.

The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible.

The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.

LfA Förderbank Bayern, founded in 1951, is the specialist promotional bank of the Free State of Bavaria. Its mandate is to use the instruments of a bank to provide financial support for the projects of commercial companies and professions in almost all branches of industry and for other measures designed to improve Bavaria's economic, transport, energy and environmental structure.

Press contacts:

Donata Riedel, d.riedel@eib.org, tel.: +49 30 590047 900, mobile: +49 151 1465 9021
Website: www.eif.org - Press Office: www.eib.org/press, +352 4379 21000, press@eib.org

Markus Wöhnl, presse@lfa.de, tel.: +49 89 21 24 - 22 26, Website: www.lfa.de