EIB-Creval: EUR 200 million securitization facility to increase lending to SMEs

A total of EUR 390 million in ABS notes placed

To increase the resources available for Small and Medium Enterprises (SMEs) through involvement of institutional investors; this is the aim of an innovative financial operation finalized by the European Investment Bank (EIB) and the Credito Valtellinese banking group (Creval Group). The EIB has subscribed a EUR 200 million loan to Creval which will result in EUR 390 million in new financing for SMEs. In the EIB-Creval meeting that concluded the approval procedure, held yesterday in Luxembourg, the EIB was represented by the Vice President Dario Scannapieco, who also holds the position of Chairman of the subsidiary European Investment Fund (EIF); Creval Group was represented by Miro Fiordi, the CEO of the group leader Credito Valtellinese.

In detail, the operation was carried out through securitization using the special purpose vehicle Quadrivio SME 2014, which issued four different classes of Asset Backed Securities (ABS) (A1, A2A, A2B, B). The total issue of the three senior classes amounts to EUR 390 million, with a rating of AA/AAA from Standard & Poor’s and DBRS; the EIB subscribed one of the classes (class A2A), for the amount of EUR 200 million. This represents the first joint intervention by the EIB Group (EIB and EIF) on the ABS market, through a dual operation: on the one hand, the EIB invests EUR 200 million in ABS; on the other, the EIF guarantees EUR 80 million in class A1 securities. The securities benefit, thanks to the EIF’s backing, from better prudential treatment and favourable market conditions.

In addition to the amount of the facility, the EIB’s intervention helped Creval attract investments from other institutional investors, who subscribed an additional EUR 110 million in ABS notes, thus creating new funding available for SMEs, for the cited total of EUR 390 million.

" With the utilisation of a securitization structure such as this one, made possible by reduced tension on the financial markets and adopted quickly by Creval, we as the EIB group offer the banks an additional possibility beyond traditional loans. In fact, the complementary nature of this intervention increases EIB's participation in the ABS market, with the effect of attracting new investors and increasing the overall facility available to the SMEs, " commented Scannapieco.

" The conclusion of this important funding operation, together with the new agreements with the EIB, " stated Fiori, " adds precious resources to our continuous and robust support for Italian enterprises. Our proximity to the local area allows us to rapidly channel resources to our clients, who consist principally of small and medium enterprises, thus maximizing the effectiveness of these tools for financing investments, which are vital for the competitiveness of the Italian production system ."

Background information

The European Investment Bank (EIB) is the European Union's long-term financial institution, whose shareholders are the Member States themselves. Its purpose is to provide long-term financing for projects that contribute to the EU's political goals.

European Investment Fund

EIF’s central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops 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 private equity funds amounted to over EUR 7.9bn at end 2013. With investments in over 435 funds, 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. EIF’s guarantees loan portfolio totalled over EUR 5.6bn in over 300 operations at end 2013, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor. For more information, please visit: http://www.eif.org/what_we_do/where/it

Press contacts

European Investment Bank

Marco Santarelli, Tel.: +39 0647191, m.santarelli@eib.org

Website: www.eib.org/press - Press Office: +352 4379 21000 - press@eib.org

European Investment Fund

Susanne Gutjahr, Tel.: +352 2485 81487, gutjahr@eif.org , Website: www.eif.org

Credito Valtellinese

Raffaella Premoli, Tel.: +39 02 80637403, premoli.raffaella@creval.it