Financial Instruments for SMEs developed by the EIB Group. 12 March 2015, Bucharest Hubert Cottogni

Transcription

1 Financial Instruments for SMEs developed by the EIB Group 12 March 2015, Bucharest Hubert Cottogni

2 Agenda SME financing in Romania EIF within the EIB Group, and what we do for SME financing EU-EIF financial instruments SME Initiative Investment Plan for Europe ( Juncker Plan ) Financial instruments under shared management in Romania 2

3 SME financing in Romania

4 SME financing in Romania Gross fixed investment expenditure in Romania decreased by 5% year-onyear in both 2014 and 2013*. Access to finance**: In 2014, a great number of enterprises reported a decline in profit and in the profit margin and turnover respectively; Access to finance was a major issue for 18 percent of firms; other problems were taxation, competition and finding customers Half of companies funded themselves from retained earnings; The main difficulties perceived by companies which applied for a loan were: the requirements regarding the value or type of collateral; and the high level of interest rates and commissions. Working capital or payments to suppliers ranked topmost among the purposes of companies financial needs. **The Economist Intelligence Unit **National Bank of Romania, Survey on the access to finance of non-financial corporations in Romania, December

5 EIF within the EIB Group, and what we do for SME financing

6 EIB Group The EU s bank, founded in 1958 and owned by the EU Member States. Largest multilateral borrower and lender. The EU s leading provider of SME risk financing, owned by EIB, EC and financial institutions, founded in EIB Group in 2014: EUR 80.3bn lending EUR 14.7bn invested in innovation SMEs supported 6

7 European Investment Fund Shareholders unique tripartite structure: 62.1% EIB, 30% European Commission (EC), 7,9% by 25 public & private financial institutions (FIs) Assets under management of over EUR 13bn, mobilising EUR 79bn with other market players AAA-rated by three major rating agencies Capital increase to EUR 4.5bn ensuring strong capital base EIF works indirectly with SMEs through intermediaries such as banks, guarantee funds, microfinance institutions, leasing companies, venture capital funds 7

8 SME Cashflows Helping businesses at every stage: EIF standardized and customizable products European and Structural Funds Portfolio Guarantees & Credit Enhancement Leasing, Factoring & Export Credit Loans & Credit Lines Formal VC Funds & Mezzanine Funds VC Seed & Early Stage Microcredit Business Angels, Technology Transfer PRE-SEED PHASE SEED PHASE START-UP PHASE EMERGING GROWTH DEVELOPMENT SME Development Stages HIGHER RISK LOWER RISK 8

9 EU-EIF financial instruments

10 EU-EIF financial instruments EU financial instruments Joint instrument Financial instruments under shared management Research, Development, Innovation Jobs, Growth and Social Cohesion Horizon 2020 Equity Facility for R&I SME and Small Mid Caps Guarantee Facility for RI (RSI successor) [EUR 1.06bn] for guarantees to SMEs/small mid caps. [EUR 0,43bn] for equity (CIP GIF 1 successor) Competitiveness & SME (COSME) [EUR 1.32 bn]: Equity Facility for Growth (GIF successor) [EUR 660m] Loan Guarantee Facility [EUR 660m] (CIP GIF 2 successor) Social Change & Innovation Progress Microfinance II Social enterprise investing [EUR 192m] Creative Europe Cultural and Creative Sector Guarantee Facility [EUR 121m] Erasmus for all Student Loan Guarantee Facility [EUR 517 m] New SME Initiative Pooling of resources from European Structural and Investment Funds (ESIF), COSME and Horizon 2020, EIB/EIF and national promotional banks Guarantees of new loans to SMEs, securitization of existing SME loans Up to [EUR 8.5bn] from ESIF, [EUR 63 m] from H2020 and [EUR 63 m] from COSME Instruments under Structural and Cohesion Funds EU level instrument (contribution of Member State (MS) funds from Operational Programmes to centrally managed EU programs) Off-the shelf instruments Tailor-made instruments Significantly higher amounts than currently, to be decided by each MS Source: EC, adapted 10

11 SME Initiative

12 The SME Initiative Introduction (i) Key objectives Better access to finance for SMEs through capital relief, loss protection and liquidity Increased multiplier on public budget through participation of EIB/EIF and private sector Reduction of financial markets fragmentation Two risk-sharing instruments endorsed by the European Council: 1. Guarantee facility for portfolios of new SME loans 2. Securitisation instrument for portfolios of both new and existing SME loans Eligible assets: SME Loans, leasing and guarantees. Restructured loans and refinancing not permitted 12

13 The SME Initiative Introduction (ii) Key advantages Credit risk protection on new (option 1) and existing, and new (option 2) portfolios of SME debt finance Uncapped guarantee (option 1) or counterguarantee and full capital structure (Option 2 subject to risk retention rules) subscribed/underwritten by EIB/EIF and possibly third party investors Subject to the national regulator, capital relief on such portfolios Attractive pricing of the two options due to no fees being charged by the FLP ESIF funds and expected loss pricing for ESIF and EU mezzanine tranches. EIB Group apply their customary pricing policy. Transfer to such benefit to the final beneficiary to be ensured Provision of funding (in option 2) cash deals and possible by the EIB 13

14 Retained by the originator The SME Initiative Schematic allocation of risks (all options) Portfolios created from eligible SME loans Tranches associated with different risks Instrument based on a risk-sharing structure Senior risk (EIB, third parties) Mezzanine risk (EIF, EU Funds, ESIF) First Loss Piece (ESIF, originator) Only under Option 2 Adapted to strong and weak SME credit environments ESIF deployed for - local use poled us ESIF to be complemented by small volume of EC central budget 14

15 Investment Plan for Europe

16 A new European Fund for Strategic Investments (EFSI) 16

17 Mobilising Finance for Investment leverage 17

18 Financial instruments under shared management in Romania

19 FIs under shared management: Stimulating SME Finance through structural funds More than EUR 3bn of finance for SMEs channelled through structural funds between Overall, Member States allocated approximately EUR 14bn to Financial Engineering Instruments (FEI) in the period of which more than 50% were committed to holding funds. The allocations for FEIs for period are expected to increase significantly. Fostering development of SMEs in EU Member States and regions through revolving instruments as opposed to grants. Impartial advice that helps regional and national authorities manage their resources. Know-how transfer to regions and helping develop sustainable risk capital markets at the local level. A total of 1.2bn assets under management, through 14 holding funds across Europe, both at regional and national level. EIF managed holding Funds have mobilised a total of 3bn to SMEs through high risk capital with 80 counterparts (out of which 49 are new EIF counterparts). 19

20 EIF managed Fund of funds on behalf of Member States and/or Regions Equity Fund-of-Fund Activity Other Mandates UK FTF: GBP 200m BIF (LT,LV,EE): EUR100m WBEDIF (AL,BA,HR,MK,ME,RS,XK): EUR 145m ERP (DE): EUR 1000m LFA-EIF (DE): EUR 100m DVI (NL): EUR 150m PGFF (PL): EUR 90m IPA Turkey (GAGF-G43-TTA*): EUR 126.9m CYPEF (CY): EUR 100m TOTAL : EUR 371.9m NEOTEC (SP): EUR 183m MDD (GER): EUR 200m PVCi (PT): EUR 111m EAF (GER, SP, A): EUR 122.5m ivci (TR): EUR 160m TOTAL : EUR 2.4bn Holding Funds Supported by Structural Funds (JEREMIE) BULGARIA: EUR 349m CALABRIA (I): EUR 45m CAMPANIA (I): EUR 90m CYPRUS: EUR 20m EXTREMADURA (ES) : EUR 19.8m GREECE: EUR 250m LANGUEDOC ROUSSILLON (FR): EUR 30m LITHUANIA: EUR 67.1m ROMANIA: EUR 150m MALTA: EUR 12m PACA (FR): EUR 20m SLOVAKIA: EUR 100m SICILY (I): EUR 60m SICILY ESF (I): EUR 15m TOTAL : EUR 1.2bn * ERP, LFA, BIF, WBEDIF will be increased in due course, along with EAF in Germany, Spain and Austria. 20

21 JEREMIE I ( ) in Romania POS CCE EUR 150m Portfolio guarantee 3 instruments, 9 intermediaries Risk sharing loan Risk capital SMEs EUR 475m at end 2015 (currently EUR 380m) 21

22 Potential future financial instruments in Romania Financial instruments are foreseen under multiple Operational Programmes. The ex-ante assessment, which is a requirement for contributions to financial instruments, is ongoing (coordinated by the Ministry of European Funds). Decisions to make: Contribution to the SME Initiative? Continuation of FIs managed under fund-of-funds (JEREMIE)? Other instruments. 22

23 Contact Details Hubert Cottogni Deputy Director Head of Mandate Management Phone: (+352) European Investment Fund 37B, avenue J.F. Kennedy L-2968 Luxembourg 23