CAIXABANK RISK SHARING SMES AND MIDCAPS

The project consists of a de-linked risk sharing guarantee, aimed at providing new lending to mall and medium-sized enterprises (SMEs) and mid-caps in Spain. The guarantee facility will be used to cover up to 50% of the credit risk associated with a Spanish bank's corporate and mid-cap loan portfolios.

The proposed transaction consists of a de-linked risk sharing guarantee between CAIXABANK and the EIB, under a partial delegation approach, aimed at creating additional lending capacity for SME & mid-cap financing in Spain. The guarantee aims to promote and accelerate private sector investments, and facilitate access to finance for SMEs and mid-caps, a backbone in terms of growth and employment for the Spanish economy.

The proposed transaction consists of a delinked risk sharing guarantee between CAIXABANK and the EIB, under a partial delegation approach, aimed at creating additional lending capacity for SME & MidCap financing in Spain. This will be the first delinked risk sharing operation with Caixabank. The guarantee aims to promote and accelerate private sector investments as well as facilitating access to finance for SMEs & Midcaps, a backbone in terms of growth and employment for the Spanish economy The operation will help address the working capital, liquidity needs and investment constrains of SMEs and Midcaps, a segment particularly affected by the pandemic, and that still remains vulnerable. Spain continues to be one of the most affected European country by the effects of the coronavirus, given the reliance of its economy on the tourism and service sectors. The unemployment rate is 13.0% (as of December 2021, almost twice the EU average, which stands at 6.4%). Unemployment amongst the youth remains high at 30.6%. The economic impacts in the economy have been widespread, as value-chains have been disrupted and consumer demand has slowed down due to the high unemployment and high inflation rates. SMEs and Midcaps are facing financial stress and bankruptcies and without continuing to address their short-term liquidity and investment needs, the adverse economic effect of the pandemic could be long-lasting. In addition, the recent war in Ukraine is creating additional challenges for SMEs & Midcaps in the form of increased input costs, which cannot be fully passed to end customers, thus creating pressure on margins.

In accordance with the Bank's policy to ensure that sub-loans comply with the EU acquis, in particular in the fields of environment and public procurement, the Bank will require the intermediary to take all the requisite measures to ensure that the environment and procurement procedures carried out by the final beneficiaries for the sub-projects that the Bank finances, will comply with the relevant EU legislation and the applicable national legislation, provided that it is in conformity with EU rules.

In accordance with the Bank's policy to ensure that sub-loans comply with the EU acquis, in particular in the fields of environment and public procurement, the Bank will require the intermediary to take all the requisite measures to ensure that the environment and procurement procedures carried out by the final beneficiaries for the sub-projects that the Bank finances, will comply with the relevant EU legislation and the applicable national legislation, provided that it is in conformity with EU rules.