The agreement is the first synthetic corporate loan securitisation transaction signed by the EIB Group and BBVA and also the first one supported by blockchain technology.

The European Investment Bank Group, formed by the European Investment Bank (EIB) and European Investment Fund (EIF), have granted BBVA a EUR 60 million synthetic guarantee that will be used to provide up to EUR 360 million to finance new investment projects of small Spanish SMEs and Midcaps. This is the third mezzanine guarantee operation and the first synthetic corporate loan securitisation in which the EIB, EIF and BBVA are jointly participating, in Spain.

The agreement has been made possible thanks to the support of the European Fund for Strategic Investments (EFSI). EFSI is the central pillar of the Investment Plan for Europe, known as the “Juncker Plan”. Its support increases the EIB Group’s capacity to finance investment projects that, in line with the Plan’s criteria, involve activities that by their structure or nature have a higher risk profile but which foster firms’ competitiveness and create jobs.

The agreement is an innovative financing operation, as it is the first corporate loan securitization to be supported by the blockchain technology in the European Union. Blockchain offers a better client experience by automating the negotiation process and minimizing operational risks, thanks to the inherent characteristics of this technology. The DLT platform developed by BBVA was used by the three parties to negotiate this agreement, from the origination to the agreement signing, and also ensuring traceability and immutability, making that way the documentation process safer and more transparent. All the negotiation was recorded on the private blockchain Hyperledger, while a hash or unique identifier of the signed agreement were recorded on the public blockchain Ethereum (testnet).

About this project, EIB Vice President Emma Navarro stated: “We are delighted to support the EIB Group’s third mezzanine guarantee operation in Spain. Thanks to our partnership with BBVA, Spanish SMEs will be able to benefit from the advantages of our financing. This agreement combines EIF and EIB resources under the Juncker Plan to increase BBVA’s support for Spanish businesses, fostering job creation and economic growth”.

European Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, said: "The European Fund for Strategic Investments was designed to help facilitate access to finance for small and medium-sized enterprises so that they can take their next steps. I welcome today's agreement which will allow Spanish businesses to access some €360 million in financing to invest in their future growth. They will join over 850,000 other small and medium-sized businesses who are already expected to benefit from the Investment Plan across Europe."

EIF’s Chief Executive, Pier Luigi Gilibert said: “SME synthetic securitisation agreements are deployed by a number of European banks to provide regulatory capital relief. EIF is pleased to be working with BBVA and the EIB to allow BBVA to provide additional access to finance for Spanish SMEs. Joint EIB and EIF support via EFSI funds offer a competitive solution for BBVA which will serve to boost the supply of finance in the real economy.”

The CEO of BBVA, Carlos Torres, added: “BBVA is committed to boosting the growth, competitiveness and digitization of the Spanish SMEs. In addition, we are proud of the DLT platform developed in-house by BBVA, which was used to negotiate this agreement."

Over the last few years, the EIB and BBVA have signed a number of other operations targeting SMEs. In November 2017, they provided EUR 300 million to finance innovation and the digitalisation of small Spanish businesses; in June 2016, they launched a EUR 600 million credit line; and in 2015, they approved a EUR 1 billion credit line to foster economic recovery and job creation in SMEs.

The first mezzanine guarantee signed in June 2017 with BBVA has so far enabled approx. EUR 1 billion worth of finance for firms in various sectors, such as wholesale, transport and tourism. The agreement signed today aims to foster support for small and medium-sized firms in all sectors of the Spanish economy, providing them with loans with favourable conditions of interest rates and longer repayment periods.

Background information

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy objectives.

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central task is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. The EIF designs and develops seed and growth capital, guarantee and microfinance instruments that specifically target this market segment. In this role, it fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment.

The Investment Plan for Europe, known as the “Juncker Plan”, is one of the European Commission’s top priorities. It focuses on boosting investment to generate jobs and growth by making smarter use of new and existing financial resources, removing obstacles to investment, and providing visibility and technical assistance to investment projects.

The European Fund for Strategic Investments (EFSI) is the main pillar of the Juncker Plan and provides first loss guarantees, enabling the EIB to invest in more projects that often come with greater risks. EFSI has already yielded tangible results. The projects and agreements approved for financing under EFSI are expected to mobilise more than EUR 371 billion in investments and support almost 850 000 SMEs in the 28 Member States.

More information on the results of the Investment Plan for Europe is available here.

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It makes long-term finance available for sound investment in order to contribute towards EU policy objectives.

Press contact

EIB:
Mercedes Landete
tel.: +34 91 431 13 40
m.landete@eib.org

Website: www.eib.org/press
Press office: +352 4379 21000 – press@eib.org

European Commission:
Enda McNamara
tel.: + 32 2 29 57361
enda.mcnamara@ec.europa.eu
Website: ec.europa.eu/invest-eu
Follow us on Twitter @EU_Commission #investEU

HIGHLIGHTS

European Fund for Strategic Investments (EFSI)