EIB and Commerzbank cooperate to give mid-caps easier access to finance
October 16 2023
- A new €400 million loan portfolio is designed to facilitate financing to medium-sized companies
- Companies with between 250 and 3 000 employees in Germany and the European Union will be eligible to apply for loans
The European Investment Bank (EIB) and Commerzbank are entering into a new cooperation in the form of a guarantee programme to support medium-sized businesses. Companies with between 250 and 3 000 employees can apply for long-term loans through Commerzbank. As part of the cooperation, a total of €400 million will be made available to these companies. The EIB will provide guarantees covering up to 50% of the loan amount.
Worldwide, access to finance for small and medium-sized businesses has become difficult due to the effects of the war in Ukraine, rising interest rates, inflationary pressure in supply chains, and the decline in the pandemic. As the banking sector responds to deteriorating credit quality with a gradual shift to low-risk assets, mid-caps are facing difficulties obtaining new financing for their business.
The cooperation between the EIB and Commerzbank will facilitate access to favourable financing conditions for mid-cap companies. The EIB guarantees will be fully beneficial to borrowers.
These guarantees are part of an EU-wide Linked Risk-Sharing Programme (LRS). This program aims to reduce some of the barriers to accessing finance through risk sharing; barriers caused by current economic uncertainties such as inflation, rising interest rates, limited external growth feeds and unsafe energy supplies.
EIB Vice-President Ambroise Fayolle, who is responsible for financing banks in Germany, said: "We are pleased to work with Commerzbank to support the key German mid-cap sector by providing guarantees for long-term loans. Together, we support projects in Germany and the European Union that are in line with the EIB's remit."
Head of Corporate Lending at Commerzbank Andreas Kern said: "The high investment needs of our corporate customers to finance the transition to sustainability in conjunction with the current global challenges require strong and reliable financing partners. We are very pleased with this partnership between the EIB and Commerzbank to support our medium-sized corporate clients long-term financing needs."
Contact European Investment Bank
Commerzbank is the leading bank for German mid-caps and a strong partner for around 26 000 corporate client groups and almost 11 million private and small-business customers in Germany. The bank’s two business segments – Private and Small-Business Customers, and Corporate Clients – offer a comprehensive portfolio of financial services. Commerzbank transacts approximately 30% of Germany’s foreign trade and is active internationally in corporate client business in almost 40 countries. The bank focuses on German mid-caps, large corporates and institutional clients. As part of its international business, Commerzbank supports clients with German connectivity and companies operating in particular future-oriented industries. In the Private and Small-Business Customers segment, the bank supports its customers through its brands Commerzbank and comdirect: online and mobile, in the advisory centre, and also provides retail banking services through its branches. Its Polish subsidiary mBank S.A. is an innovative digital bank that serves approximately 5.7 million private and corporate clients, predominantly in Poland as well as in the Czech Republic and Slovakia.
About European Investment Bank (EIB)
The European Investment Bank is the long-term lending institution of the European Union owned by its Member States. It provides financing for sound investments that further EU policy goals. Its key priorities are climate and the environment, development, innovation and skills, small and medium-sized businesses (SMEs), infrastructure and cohesion. It works closely with other EU institutions to foster European integration, promote the European Union’s development and support EU policies in more than 140 countries worldwide.