By Deirdre Tynan • 19 July 2021 • 17:13
EIF guarantee of up to €154 million to ABANCA to leverage up to €220 million in support for SMEs impacted by the Covid-19 crisis in Spain.
The European Investment Fund (EIF), part of the European Investment Bank (EIB) Group, and ABANCA have joined forces to back the growth and development phase of Spanish small and medium-sized companies (SMEs) hit by the economic crisis generated by COVID-19.
The EIF will provide a €154 million uncapped guarantee to ABANCA, enabling the Spanish bank to originate a portfolio of €220 million of financing for Spanish SMEs to mitigate the economic consequences of the pandemic. The agreement is backed by the European Guarantee Fund (EGF), part of the €540 billion EU rescue package approved to respond to the economic impact produced by the pandemic.
Thanks to the EIF guarantee under the EGF, ABANCA will offer more favourable financing to SMEs and small mid-caps active in sectors particularly exposed to the Covid-19 pandemic, backing their recovery from liquidity shortages and safeguarding jobs in the country. The EIF will take up to 70 per cent of the risk on these new loans granted to SMEs by the Spanish bank.
“I am delighted to join forces with ABANCA to mobilise up to €220 million of financing for small businesses to mitigate the negative economic effects of the pandemic in Spain. Entrepreneurs are worried about the impact of Covid-19, the liquidity position, and the survival of SMEs,” said Alain Godard, Chief Executive of the EIF.
“The EIB Group launched the European Guarantee Fund to overcome these constraints, enhancing SMEs’ access to finance on favourable conditions to promote growth, innovation and employment across Europe,” he added.
“The European Guarantee Fund is delivering the liquidity needed by small and medium-sized companies to cope with the economic shock caused by Covid-19, which is affecting 96 per cent of Spanish SMEs. We are on the right track and, thanks to our wide network of intermediaries, we aim to reach as many companies as possible both in Spain and in Europe,” said EIB Vice-President Ricardo Mourinho Félix.
Francisco Botas Ratera, CEO of ABANCA, added, “It is a priority for ABANCA to help companies to offset the effects of the pandemic and establish the foundations for future economic growth. For this reason, we have been very active in mobilising all the lines available to our corporate clients, which have always been a fundamental and strategic sector for our entity and for the economic development of our society. Our ability to develop this objective is supported by the solid positioning we have with SMEs and companies and by our reach.”
The European Investment Fund is part of the European Investment Bank Group. The European Guarantee Fund (EGF) was created by the EIB Group with contributions from all 27 EU Member States to protect companies that are struggling in the crisis caused by Covid-19. The EGF forms part of the package of recovery measures put in place by the European Union, with the objective of providing a total of €540 billion to support the hardest hit sectors of the EU economy.
Thank you for reading, and don’t forget to check The Euro Weekly News for all your up-to-date local and international news stories.
Share this story
Subscribe to our Euro Weekly News alerts to get the latest stories into your inbox!
By signing up, you will create a Euro Weekly News account if you don’t already have one. Review our
Deirdre Tynan is an award-winning journalist who enjoys bringing the best in news reporting to Spain’s largest English-language newspaper, Euro Weekly News. She has previously worked at The Mirror, Ireland on Sunday and for news agencies, media outlets and international organisations in America, Europe and Asia. A huge fan of British politics and newspapers, Deirdre is equally fascinated by the political scene in Madrid and Sevilla. She moved to Spain in 2018 and is based in Jaen.
Your email address will not be published. Required fields are marked *
Downlaod our media pack in either English or Spanish.