The European Investment Fund (EIF) and Sparbanken Öresund have signed a guarantee agreement to support lending to small and medium-sized enterprises (SMEs) under an initiative funded by the European Commission.

The new agreement signed under the Risk Sharing Instrument (RSI) initiative allows Sparbanken Öresund to provide innovative companies in Sweden with access to a total of SEK 300m (EUR 35m) of debt financing over the next two years with support of the 50% guarantee offered by the EIF. This enables Sparbanken Öresund to offer innovative companies additional financing at favourable conditions.

This is the first RSI agreement in Sweden and the 17^th in Europe so far, bringing the total loan finance available to innovative businesses across the EU under this initiative to well above EUR 1.8bn. The agreement signed today will help the bank to target more innovative businesses across the region.

Commenting on the signature in Malmö, Senior Structured Finance Manager at the EIF, Roland Kampe said: “I am pleased to be signing out first RSI agreement in Sweden with Sparbanken Öresund under the new Risk Sharing Instrument (RSI) under a FP7 programme in support of innovative small and medium sized enterprises. I am confident that Sparbanken Öresund, a long term partner of EIF, will ensure that much needed finance will be quickly channelled to a number innovation driven businesses across the region.”

Sparbanken Öresund Deputy CEO Mats Nilsson said: “Through our cooperation with EIF, we, as the first bank in the Nordic region, can now offer favourable long-term financing to development and growth-oriented companies. This is naturally very gratifying and we really hope that this initiative will facilitate the operations of a number of innovation-driven companies in the region. Contributing in this manner to the development of these companies, and thus also to progress in the region, is completely in line with our mission as a local bank – creating value together with our customers”.

The aim of the RSI Facility is to encourage banks to lend to SMEs and small mid-caps with fewer than 500 employees in need of investment financing and/or operating capital to support research, development and innovation activities, with EU financial support. Banks are being selected by the EIF following a call for expression of interest for financial intermediaries across Europe.

About ut Risk-Sharing Instrument (RSI) under FP7

The RSI facility aims to encourage banks to provide loans of up to €7.5 million to SMEs and small mid-caps undertaking research, development or innovation, and seeking finance for investments and/or working capital. The RSI is a joint initiative of the EIF, the European Investment Bank (EIB) and the European Commission. It is supported by the European Union under the Seventh Framework Programme for Research and Technological Development (FP7) and uses EIF's risk-taking capacity. It is part of, and complements, the existing Risk Sharing Finance Facility (RSFF), managed by the EIB.

Under this facility, the European Investment Fund (EIF) is providing guarantees to banks and leasing companies that lend to SMEs and Small Mid-Caps. The guarantee covers, upon default, up to 50% of the outstanding amount of each loan. Some 25 or so banks are expected to be involved in the pilot phase, allowing the RSI to reach a total loan volume of up to €2.5 billion channelled to innovative SMEs and Small Mid-caps.

The call is open to financial or credit institutions, established and operating in the EU and/or countries associated to FP7, including, Iceland, Liechtenstein, and Norway, Switzerland, Israel, Turkey, the former Yugoslav Republic of Macedonia, Serbia, Albania, Montenegro, Bosnia & Herzegovina, the Faroe Islands and Moldova.

About the EIF

EIF's central mission is to support Europe's small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture capital and guarantees instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. The EIF total net commitments to private equity funds amounted to over EUR 6.5bn at end 2012. With investments in over 430 funds, the EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. The EIF guarantees loan portfolio totalled over EUR 4.7bn in 255 operations at end 2012, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

Press contacts:

EIF: David Yormesor
Tel.: +352 42 66 88 346, e-mail: d.yormesor@eif.org

Sparbanken Öresund: Göran Sjöberg
Tel.: +46 40 608 13 10, e-mail: goran.sjoberg@sparbankenoresund.se

HIGHLIGHTS

Risk Sharing Instrument (RSI)