The European Investment Fund (EIF) and Millennium bcp (Banco Comercial Português, S.A.) have signed a guarantee agreement aimed at supporting micro-businesses and self-employed entrepreneurs in Portugal.

This transaction was signed under the European Progress Microfinance Facility (Progress Microfinance), funded by the European Commission and the European Investment Bank and managed by the European Investment Fund.

Thanks to this agreement, Millennium bcp, through its Autonomous Microcredit Network, will be able to continue providing micro loans to micro-businesses across Portugal, targeting in particular riskier borrowers who have difficulties in accessing the traditional credit market and cannot offer any third party guarantee. It is expected that Millennium bcp will provide over EUR 3m of micro loans during the next 2 years.

Commenting on the transaction, EIF Investment Manager Saiyi Suzuki Navarro said: “We are pleased to be signing our first guarantee agreement in Portugal under Progress Microfinance with Millennium bcp”.

“I am convinced that this agreement will lead to additional funding for this important sector to benefit micro-enterprises and help them grow at this crucial time for the economy in Portugal.”

Helena Mena, responsible for Millennium’s Microcredit unit, said: “It is with great satisfaction that we formalize this contract for a guarantee with the EIF, and that Millennium is the first bank in Portugal to benefit from this European Commission initiative. This demonstrates Millennium’s desire to continue to support Microcredit, as part of its corporate social responsibility policy, allowing it to ensure financing of €3.5 million over the next two years. We believe that Microcredit plays an important role in job creation and helps people achieve their goals. As we cross this period of crisis, Microcredit can help create opportunities for entrepreneurs, people with the will and initiative to succeed. And our track record on job creation and financing of micro-companies speaks for itself”.

About the European Progress Microfinance Facility

The European Progress Microfinance Facility (Progress Microfinance) provides guarantees and funded instruments to microfinance intermediaries. The initiative is established with EUR 203m of funding from the European Commission and the European Investment Bank. Progress Microfinance aims to increase access to finance for micro-entrepreneurs, including the self-employed. It has a particular focus on, but is not restricted to, groups with limited access to the conventional credit market. Examples include female entrepreneurs, young entrepreneurs, entrepreneurs belonging to a minority group, entrepreneurs with a disability, sole traders etc. Loans less than EUR 25,000 are made available through selected intermediaries participating in the facility. Progress Microfinance does not provide financing or guarantees to micro-entrepreneurs or individuals directly.

About the EIF

EIF's central mission is to support Europe's small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture capital and guarantees 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. The EIF total net commitments to private equity funds amounted to over EUR 6bn at end 2011. With investments in over 370 funds, the 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. The EIF guarantees loan portfolio totalled over EUR 7.6bn in close to 220 operations at end 2011, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

About Millennium bcp

Millennium bcp is a leading private financial group in Portugal, with a strong presence in the market, fuelled by permanent innovation. The bank also has a significant international presence, with operations in Angola, Mozambique, Poland, Macao, Romania and Greece, as well as representative offices in many other markets. Millennium bcp’s activity is primarily focused in retail banking, but also offers a range of additional financial services, including investment banking, corporate and commercial banking, private banking and asset management.

In 2005, Millennium bcp launched its Autonomous Network of Microcredit. This unique and innovative initiative stems from the bank’s perception of social responsibility, based on the principle of sustainability. The independent Microcredit network is a tool for social inclusion, creating opportunities for those who traditionally have no access to credit.

Millennium bcp’s Microcredit network has already financed 2,464 new businesses, which have created 3,697 new jobs.

Contacts:

- EIF: David Yormesor, d.yormesor@eif.org
- Millennium bcp, Erik T. Burns, Erik.Burns@millenniumbcp.pt or visit Millennium bcp’s website www.millenniumbcp.pt.