The European Investment Bank Group (EIB and EIF) and BBVA are once again joining forces to support the working capital and liquidity needs of Spanish small and medium-sized enterprises affected by the COVID19 crisis, as well as to cover their investment difficulties. To this end, the European Investment Bank (EIB) and the European Investment Fund (EIF) will guarantee a junior tranche of a €120 million synthetic securitization of an SME loan portfolio originated by BBVA, enabling the Basque bank to provide more than €960 million in financing to support the investment of small and medium-sized enterprises.
The EIB Group guarantee will unlock additional capital that will be used by BBVA to provide new loans to SMEs and midcaps at a multiple of the guarantee amount, generating a high impact. Thanks to this agreement, BBVA will be able to expand its lending capacity and provide an additional €960 million of financing at a critical time for the Spanish economy.
The transaction covers the first loss piece in a synthetic securitization structure under the European Guarantee Fund, approved by the European Council as part of the EUR 540 billion package of measures with which the EU is responding to the economic impact caused by COVID-19.
The EIB and BBVA have been working together for more than 30 years. During this period, the two institutions have signed more than 140 operations in 17 countries, providing direct financing to SMEs and mid-cap companies for more than EUR 4.5 billion.
EIB Vice-President Ricardo Mourinho Félix, said: “BBVA has been, and remains, a key partner for the EIB Group for the past 30 years. Together, we continue to promote new initiatives in the Spanish market to meet the European Union's policy objectives by supporting the financing needs of small and medium-sized enterprises, the backbone of the European economy.”
EIF Chief Executive Alain Godard added: “We are pleased to have concluded one of the firstsecuritisation transactions under the European Guarantee Fund with BBVA. This shows that BBVA andthe EIB Group are committed to helping SMEs in Spain, particularly in difficult times such as these.”
Meanwhile, BBVA's CEO, Onur Genç, said: “The role of the self-employed and small and medium-sized enterprises is crucial to the Spanish economy. With this new agreement with the EIB we are continuing to support them in their projects, especially in the field of sustainability and digitalization, and thereby supporting the recovery.”