The European Investment Bank (EIB) is the European Union's financing institution. Its shareholders are the 27 Member States of the Union, which have jointly subscribed its capital. The EIB's Board of Governors is composed of the Finance Ministers of these States. The EIB's role is to provide long-term finance in support of investment projects.
One of the EIB Group’s top operational priorities is to support the investments of small and medium-sized enterprises (SMEs), the engine of Europe’s economy.
Well before the crisis erupted, the EIB undertook a wide-ranging consultation of SME market players enabling it to develop a new lending product, dubbed EIB loans for SMEs. Available since October 2008 and channelled through commercial banks, these new loans are simpler, more flexible and more transparent, making it possible to reach a greater number of European SMEs.
With a total of EUR 20.8bn signed with intermediary banks during 2008 and 2009, the EIB is well on its way to delivering on its target of lending EUR 30bn to SMEs between 2008 - 2011, a target set in the European Economic Recovery Plan that was adopted by the Heads of State and Government in December 2008.
The cooperation between the EIB and BDB includes the following loans:
EIB loans for SMEs, provided by Bulgarian Development Bank AD
• To finance which enterprises? All independent SMEs with fewer than 250 employees in the 27 EU Member States are eligible. The subsidiaries or holding companies of groups with more than 250 employees are normally not eligible.
• To finance what? All expenditure necessary for a small business to develop, such as:
o Tangible investments and intangible investments: purchases of plant and equipment. Land purchases are ruled out unless they are essential to the project. The purchase of farm land is totally excluded.
o Working capital needs: EIB Loans for SMEs may be used to provide a stable working capital base to allow SME Final Beneficiaries to finance liabilities associated with their trading cycle, as part of their normal activities.
o All economic sectors are eligible except for a limited number of exclusions.
• For what amounts? From very small projects to investments with a maximum cost of EUR 25 million. The EIB’s contribution cannot exceed EUR 12.5 million.
• What advantages does the EIB create for SMEs? Projects approved by EIB for financing under the program will be provided with financial advantage of 25bps reflected in their relevant interest rate.
EIB loans for non-SMEs, provided by Bulgarian Development Bank AD
• To finance which enterprises? EIB also provides support for final beneficiaries of any size or ownership (public or private) for industrial investments in the field of infrastructure, energy, environmental protection, industry, health and education, knowledge economy and i2i.
• To finance what?
o Tangible and intangible investments. Land purchases are ruled out unless they are essential to the project. Part of the loan can be utilised for allocations to Sub-projects involving used fixed.
o Working capital needs: a permanent increase in working capital required to expand business activity as a result of the Sub-project.
• For what amounts? EIB will only consider Sub-projects whose costs are normally at least EUR 40 000 and do not exceed EUR 25 million.
• What advantages does the EIB create for SMEs? Projects approved by EIB for financing under the program will be provided with financial advantage of 25bps reflected in their relevant interest rate.
