EUR 900m will go to SMEs finding it hardest to access finance, such as micro-enterprises and entrepreneurs
The agreements will make it possible to provide EUR 1bn to business owners that need to renew their vehicles
Employment impact: the operation will help maintain almost 400 000 jobs
Some of these funds will be granted with Investment Plan for Europe support

The European Investment Bank Group, composed of the European Investment Bank (EIB) and European Investment Fund (EIF), and Banco Santander are set to provide EUR 1.9bn to Spanish small and medium-sized enterprises (SMEs) and mid-caps via agreements signed in Madrid by EIB Vice-President Emma Navarro, Banco Santander CEO José Antonio Álvarez and Senior Executive Vice President of Banco Santander and Head of Santander Consumer Finance (SCF) Magda Salarich. The goal of both institutions is to join forces to support Spanish companies by offering them financing with favourable conditions, in terms of both interest rates and maturity periods, to foster economic growth and employment.

Support for the most vulnerable SMEs

The EIB and Santander will provide EUR 900m to SMEs and mid-caps via a risk-sharing operation – an innovative agreement making it possible to share risks between the two organisations. In concrete terms, the EIB will invest EUR 450m in a portfolio of loans granted to companies by Banco Santander. This support will enable Banco Santander to expand its financing capacity and make EUR 900m available to SMEs. Some of these funds will go to three particularly vulnerable types of SMEs: the self-employed, micro-enterprises with under ten employees, and small businesses operating in regions with high unemployment. This agreement will help support almost 7 000 SMEs employing around 160 000 people.

This is the third risk-sharing operation signed by the EIB and Banco Santander and was made possible by the Investment Plan for Europe, the support of which enables the EU bank to finance riskier projects.

EUR 1bn to renew companies’ transport fleets

The EIB Group also signed an agreement with Santander Consumer Finance making it possible to provide EUR 1bn to help Spanish SMEs and mid-caps to renew their transport fleets with more efficient and environmentally friendly vehicles, including via leasing. These funds will help to secure 250 000 jobs.

The agreement was implemented via EIB and EIF investment in a Santander Consumer Finance consumer loan securitisation fund. The EIB has purchased EUR 227m of bonds issued by the fund and the EIF has guaranteed an additional EUR 270m. This innovative financial instrument is state-of-the-art from a regulatory standpoint and will enable Santander Consumer Finance to free up capital from its loan portfolio to grant EUR 1bn in new financing.

At the signing ceremony, EIB Vice-President Emma Navarro highlighted “the impact of these agreements on creating and securing jobs in Spain. We are particularly pleased to be able to support companies whose size or business area mean that they find it more difficult to implement their investments, and to help those needing to replace their transport fleets with less polluting alternatives to benefit from the advantages of EIB financing. Ensuring these companies have access to the resources they need to grow and become more competitive is one of the EIB Group's main goals. To this end, in recent years we have dedicated over 50% of our total financing in Spain to supporting small and medium-sized enterprises.”

The European Investment Bank (ElB) 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.

Supporting small and medium-sized enterprises (SMEs) is one of the EIB Group’s key priorities. The Bank dedicated over EUR 4.8bn to this goal last year, representing 57% of the EIB Group's activity in Spain, which received more support for SMEs than any other country. These funds benefited more than 82 600 Spanish companies employing 766 000 people.

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. The EIF designs and develops venture and growth capital, guarantee and micro-finance instruments that specifically target this market segment. In this role, the EIF fosters EU objectives to support 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 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 439.4bn in investment and support almost 1 million SMEs in the 28 Member States.

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

Banco Santander (SAN SM, STD US, BNC LN) is a leading retail and commercial bank, founded in 1857 and headquartered in Spain. It has a meaningful presence in 10 core markets in Europe and the Americas, and is the largest bank in the euro zone by market capitalization. Its purpose is to help people and businesses prosper in a simple, personal and fair way. At the end of June 2019, Banco Santander had EUR 1.03 trillion in customer funds (deposits and mutual funds), 142 million customers, 13,000 branches and 200,000 employees. Banco Santander made underlying profit of EUR 4,045 million in the first half of 2019, an increase of 2% in constant euros compared to the same period last year.

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

Banco Santander: Tel. +34912895211 comunicación@gruposantander.com
www.santander.com - Twitter: @bancosantander