J E R E M IE : a n innova tive ins trum ent to s upport S M E s Jozef Stahl DG R eg ional Polic y - Unit D3 Financial Eng ineering O P E N D A Y S 2010 Works hop on J A S P E R S, J E R E M IE, J E S S IC A - prog res s a nd future pers pec tives, 5th O c tober 2010 1
J E R E M IE = Joint European Resources for Micro to medium Enterprises Joint initiative of the Commission and the EIF/ the EIB Group Objective: provision of debt, equity and/or guarantees to finance SMEs expansion or new business creation s pec ia l foc us on s ta rt ups, new tec hnolog ies, innova tion, tec hnolog y tra ns fer to S M E s Commission partners: Member States, EIF, EIB, other financial institutions 2
Innova tive elem ents JEREMIE as financial engineering instrument has two main innovative features: R epayable ins truments ins tead of onc e- off payment of g rants Introduc tion of Holding Fund optional to org anis e operations on behalf of manag ing authorities flexibility, expertis e, leverag e, 3
K ey a dva nta g es of Fin. E ng. Sustainability by recycling funds over long-term Leverage effect by attracting other sources of finance, including private funds + by structuring instruments Stronger incentives towards better performance and efficiency New sources of expertise and know-how Development and/or modernisation of financial markets (new products, new players) 4
Operational Programme J E R E M IE Flow C ha rt Holding Fund Financial Intermediaries SMEs 5
H olding Fund m a in a dva nta g es Investment flexibility: possibility of adapting investment strategy to market needs/ market developments Expertise and know-how of a professional institution Transfer of significant part of administrative tasks from managing authorities to HF Financial leverage at the level of HF Incentives in regulations 6
H olding Fund princ ipa l ta s ks Development of investment strategy and product mix Organisation of calls for financial intermediaries Selection of financial intermediaries: E va lua tion of offers, due dilig enc e, neg otia tions of a g reem ents Monitoring, controlling and reporting to managing authorities Financial management, accounting, etc. 7
Financial products for SMEs Start-up Early stage Expansion stage Equity Venture capital Debt Micro-credit Loans Guarantees Guarantees Hybrid instruments Other instruments Participative loans Technology transfer, Incubators, Pre-seed Mezzanine instruments Private investors/ Business angels 8
Im plem enta tion pha s es Phase 1 Evaluation and programming Phase 2 Selection of HF (optional) Phase 3 Selection of financial intermediaries Phase 4 Provision of funding to SMEs 9
E va lua tion pha s e JEREMIE evaluation studies (2006-2008): S c ope: analys is of demand and s upply of financ ial produc ts for S M E s ( g ap analys is ) + rec ommendations on next s teps Offered for free to M ember S tates and reg ions interes ted in the implementation of JE R E M IE C o-financ ed 85% by the C ommis s ion and 15% by the E IF 55 reports c ompleted 1 0
Bulgaria N Cyprus N Czech Republic N Denmark N JEREMIE evaluation studies 15 MS- evaluations at national level only 2 MS - evaluations at regional level only Estonia N France R (13) Germany R(1) Greece N Hungary N 4 MS - evaluations at national and regional level 21 MS covered by evaluation studies Italy N R(2) Latvia N Lithuania N Malta N Poland N R(6) Portugal N Romania N Slovakia N Austria 0 Slovenia N Spain N R(10) Sweden N United Kingdom N R(4) Belgium 0 Finland 0 Ireland 0 Luxemburg 0 Netherlands 0 Legend: N: National evaluations R: Regional evaluations 0: No evaluation requested ( ): number of reports 1 1
JEREMIE Holding Funds EIF as JEREMIE HF Greece Romania Latvia Lithuania (*) Languedoc-Roussillon (FR) Campania (IT) Slovakia (EIF with SZRB) Cyprus Bulgaria Sicily (IT) Malta Hungary Other institutions as JHF Lithuania (*) Lombardia (IT) UK: Wales +EIB loan, North East England +EIB loan, Yorkshire&Humberside +EIB loan Spain: national, Andalusia, Cataluña Poland: national, 5 regional and one multi-regional Auvergne (FR) Slovenia: national 1 2
P ers pec tives JEREMIE HF agreements signed so far provide for a total amount of some 3.1 billion. EIF is managing around one third of this amount (11 HF mandates) and other financial institutions are managing two thirds (17-18 HF mandates). Financial engineering instruments for SMEs (without HFs) in other regions: e.g. Scotland (UK); Toscania, Emilia Romagna, Lazio, Veneto, Molise, Sardinia, Piemonte (IT). 1 3
J E R E M IE N etw orking P la tform Launched by the Commission/ DG REGIO in co-operation with the EIF Role: a tool to foster the implementation of JEREMIE in MS and regions Objectives: E xc hang ing know -how and experienc e about JE R E M IE Inc reas ing knowledg e of financ ial eng ineering ins truments in the field of S M E financ ing Developing propos als for now and future 1 4
For further inform a tion: Websites: h t t p ://je re m ie.e u ro p a.e u h t t p ://je ssica.e u ro p a.e u h t t p ://jasp e rs.e u ro p a.e u D G R E G IO U nit D 3 Fina nc ia l E ng ineering 1 5