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Investment Plan for Europe: EIF and KfW Bankengruppe sign first agreement in Germany to provide EUR 1bn to start-ups

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    Date: 17 September 2015

The European Investment Fund (EIF) and the German promotional bank KfW Bankengruppe have signed the first COSME agreement – an EU funding programme for SMEs – in Germany. The deal benefits from the support of the European Fund for Strategic Investments (EFSI) through which the Investment Plan for Europe is being deployed by the European Commission and the EIB Group.

The agreement will allow KfW Bankengruppe to support EUR 1 billion of loans to start-ups in Germany over the next two and a half years. The loans will be provided thanks to a guarantee from EIF under the COSME programme with financial backing from the European Commission. The agreement will make it possible for KfW to support additional financing at favourable conditions to over 15,000 start-ups and young small enterprises under KfW’s StartGeld programme.

European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "The agreement being signed today by the EIF and KfW is fantastic news for start-ups across Germany. With the EFSI backing, €1 billion of loans will reach those individuals who want to grow their businesses and boost employment locally. This is exactly what the Investment Plan was created for."

EIF Chief Executive, Pier Luigi Gilibert said: “I am pleased to be signing the first EFSI SME guarantee agreement in Germany under the COSME programme. Working with our long- term partners at KfW Bankengruppe, EFSI will allow us to increase our support for companies and help entrepreneurs to start up and develop their businesses. I am strongly convinced that we will together with KfW Bankengruppe support German enterprises with limited or no access to finance to grow their business and create jobs”.

Dr. Ingrid Hengster, member of the Executive Board of KfW Group said: “Start-ups are the drivers of growth, innovation and job creation. Through the EFSI we can support even more start-ups and young entrepreneurs even better. As a first project under the Juncker plan in Germany, cooperation with the EIF on the basis of proven structures can serve as a model for further projects. KfW, as a promotional bank, is ready and willing to participate in its implementation.”

EIB Vice-President, Ambroise Fayolle said: “This transaction demonstrates the EIB Group’s commitment to make the Investment Plan for Europe operational even before EFSI is officially launched. EUR 1bn of EU support provides a substantial boost to SMEs in need of finance in order to grow and create jobs. Supporting jobs and growth lies at the heart of the EIB’s mission and we are pleased to be contributing to this aim with KfW. By providing guarantees against the inherent risk in this type of financing, the EIB Group will to act as a key support for German start-ups, helping to strengthen the role of businesses in both in Germany and across the European Union.”

This is one of the first COSME transactions in Europe signed thanks to EFSI support. The deal reflects the EIB Group’s commitment to respond swiftly to calls from Member States, the European Commission and the European Parliament for a rapid launch of concrete initiatives under EFSI, accelerating lending and guaranteeing transactions capable of boosting jobs and growth in the EU.

About the EIF

The European Investment Fund (EIF) is part of the European Investment Bank group. Its 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 8.8 billion at end 2014. With investments in over 500 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 5.6 billion in over 350 operations at end 2014, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

About KfW

KfW is one of the world’s leading promotional banks. With its decades of experience, KfW is committed to improving economic, social and ecological living conditions worldwided on behalf of the Federal Republic of Germany and the federal states. To do this, it supplied funds totaling EUR 74.1 billion in 2014 alone; and of this, 36 % went into measures of protecting the environment and combating climate change. With the help of KfW, small and medium-sized enterprises can consolidate their businesses and invest in growth. KfW also offers special programmes for promoting innovative technology companies, the use of renewable energy and improving energy efficiency within companies. In 2014, KfW’s promotional business volume in the area of SME finance totalled EUR 19.9 billion.

www.kfw.de/europa

About COSME

COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020. With a total budget of EUR 2.3 billion, COSME mobilises loans and equity investments to SMEs in Europe. The COSME Loan Guarantee Facility supports guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance to SMEs. This facility also includes securitisation of SME debt finance portfolios. The COSME programme also invests through the COSME Equity Facility for Growth in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages. The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (CIP) (2007-2013) which helped to mobilise more than EUR 19 billion of loans and EUR 3 billion of venture capital to over 370,000 SMEs in Europe.

Businesses can contact selected financial institutions in their country to access EU financing: www.access2finance.eu 

About the Investment Plan for Europe

Press contacts:

- EIF: David Yormesor Tel.: +352 42 66 88 346, e-mail: d.yormesor@eif.org

- KfW: Sonja Höpfner Tel.: +49 69 74314306 , e-mail: sonja.hoepfner@kfw.de

- European Commission: Annika Breidthardt Tel.: +322 295 6153, e-mail: Annika.breidthardt@ec.europa.eu


 
 

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