Investment Plan for Europe: EIF and KredEx sign COSME agreement to support EUR 200 million of loans to SMEs in Estonia

The European Investment Fund (EIF) and KredEx have signed a COSME agreement in Estonia, benefiting from the support of the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe.

The COSME counter-guarantee agreement will allow KredEx to support EUR 200m of loans and leases to 1000 Small and Medium-sized Enterprises (SMEs) in Estonia over the next three years. KredEx will provide subordinated guarantees to banks and leasing companies for investment loans, working capital loans, leases, overdrafts and bank guarantees. The counter-guarantee agreement is provided under the COSME programme with financial backing from the European Commission.

EIB Vice-President, Jan Vapaavuori said: "The EIB Group is dedicated to the creation of jobs and growth in Europe. The signature with KredEx shows the EIB Group’s commitment to deliver concrete results for SMEs in Estonia. I very much welcome this project which is part of our successful effort to roll out the EFSI in 2015.”

EU Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "As I saw during my visit to the country in June, Estonia is a frontrunner when it comes to innovation and entrepreneurship. This agreement being signed by KredEx with the EIF is good news for 1000 SMEs who will receive financing for their businesses. Estonia can also benefit in the context of the investment plan from infrastructure projects and in particular cross-border ones."

Commenting on the signature, EIF Chief Executive, Pier Luigi Gilibert said: “I am pleased that we are signing the EFSI SME counter-guarantee agreement in Estonia with our long-standing partner, KredEx under the COSME programme. This new agreement will enable Estonian SMEs with limited collateral to gain access to finance to create jobs and growth and develop their companies”.

Lehar Kütt, CEO at KredEx said: "It is mainly the rapidly developing companies, small companies and start-up companies that are not able to qualify for a loan due to their lack of guarantee. At the same time, these are the enterprises which initiate innovation in the economy and create jobs. This is why I am very pleased that with the help of COSMEs counter-guarantee we are able to facilitate access to loan capital for such enterprises.”

This deal reflects the EIB Group’s commitment to respond swiftly to calls from Member States, the European Commission and the European Parliament for a rapid launch of concrete initiatives under EFSI, accelerating lending and guaranteeing transactions capable of boosting jobs and growth in the EU.

About the EIF

The European Investment Fund's (EIF) is part of the European Investment Bank group. Its central mission is to support Europe's micro, small and medium-sized businesses by helping them to access finance. EIF designs and develops both venture and growth capital, guarantees and microfinance 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. EIF’s total net commitments to equity funds amounted to over EUR 8.8bn at end 2014. With investments in over 500 funds, EIF is a leading player in European venture and growth funds, including in the high-tech and early-stage segments. In addition to its equity activities EIF’s loan guarantees portfolio totalled over EUR 5.6bn in over 350 operations at end 2014, ranking it as a major European SME guarantee provider and a leading micro-finance guarantor.

About KredEx

KredEx is a financing institution helping Estonian enterprises develop quicker and expand more safely to foreign markets, offering loans, venture capital, credit insurance and guarantees with state guarantee.  For more information : www.kredex.ee 

About COSME

COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020 with a total budget of EUR 2.3 billion. At least 60% of the programme will be devoted to ease access to finance for SMEs in Europe, with two financial instruments. The COSME Loan Guarantee Facility supports guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance to SMEs. This facility also includes securitisation of SME debt finance portfolios. The COSME programme also invests through the COSME Equity Facility for Growth in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages. The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (CIP) (2007-2013) which helped to mobilise more than EUR 20 billion of loans and EUR 3 billion of venture capital to over 373,000 SMEs in Europe.

Businesses can contact selected financial institutions in their country to access EU financing: http://www.access2finance.eu/

About the Investment Plan for Europe

Press contacts:

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

KredEx: Tarmo Seliste Tel.: +372 55654 193, e-mail: tarmo.seliste@kredex.ee

European Commission: Annika Breidthardt Tel.: +322 295 6153, e-mail: Annika.breidthardt@ec.europa.eu