- The EIB Group has participated in an asset-backed securities issuance by BBVA for a total amount of around €460 million.
- Approximately €400 million of the proceeds will be used to finance loans in cohesion regions.
- An additional €60 million investment from the EIB Group will be channelled into energy efficiency projects like the construction of nearly zero-emissions buildings.
- Instituto de Crédito Oficial (ICO) is investing €100 million facilitating access to finance for small and medium-sized enterprises and self-employed in Spain.
The EIB Group (European Investment Bank and European Investment Fund) and the Instituto de Crédito Oficial (ICO) have invested in senior and mezzanine tranches of asset-backed securities (ABS) issued by BBVA to support working capital and liquidity needs, and address the investment constraints of Spanish small and medium-sized enterprises (SMEs) and mid-caps. Proceeds will be also channelled into green projects.
A large proportion of the final beneficiaries of this agreement for SMEs will be based in cohesion regions — where per capita gross domestic product is below the EU average and where it is particularly difficult to access financing. The operation will thus promote equitable growth and convergence between EU regions, which is one of the key aims of the EIB’s lending activities.
As part of the transaction, the European Investment Bank (EIB) makes an investment commitment of €430 million while €30 million are committed by the European Investment Fund (EIF). ICO’s participation in this ABS transaction translates into a total investment of €100 million. The total investments of this deal will enable the Spanish bank to direct up to €1.26 billion into the real economy.
The EIB Group’s total investment (€460 million) takes through a single securitisation with a structure designed to achieve optimal efficiency.
On one side, the notes purchase worth approximately €400 million targets SMEs and mid-caps to facilitate its access to finance and to promote and accelerate private sector investments. The transaction will address working capital and liquidity needs, and it will tackle investment constraints faced by these enterprises in the aftermath of the pandemic, the war in Ukraine, persistent inflationary pressures and increases in interest rates, among other issues.
On the other side, the current ABS securitisation transaction has a green component coming from the EIB Group’s €60 million investment. These funds will finance environment and climate action projects based on energy efficiency activities like the construction of nearly zero-emissions buildings carried out by real estate developers, or solar photovoltaic installations. The transaction supports the national and European targets for energy efficiency and renewable energy and contributes to the reduction of carbon emissions. This focus on energy efficiency is aligned with the EIB Group’s cross-cutting objective of climate change mitigation, and with REPowerEU, the EU plan to make Europe more energy independent.
“We are pleased to join forces with ICO and BBVA in this transaction in Spain covering priorities for the EIB Group, such as supporting the financial needs of SMEs, the backbone of the European economy. An initiative with added value as many of the beneficiaries are in cohesion regions, in line with the Group’s objective of promoting economic, social and territorial cohesion in the European Union,” stated EIB Vice-President Ricardo Mourinho Félix. “The EIB Group is also strengthening the energy transition, boosting energy efficiency investments on the Spanish market to meet EU policy objectives.”
ICO Chairman José Carlos García de Quevedo said: “This transaction is part of the ICO Group's 2022-2027 strategy, whose action plans promote the growth of Spanish SMEs and the green and digital transition. We are pleased to join forces with the EIB Group and BBVA in this operation, which will channel finance to Spanish companies to support their projects and growth plans.”
“The EIF is delighted to be renewing our partnership with BBVA and ICO,” said EIF Chief Executive Marjut Falkstedt. “This transaction puts our securitisation tools to good use, generating fresh lending capacity in support of small Spanish businesses, strengthening their competitiveness and boosting growth and jobs. At the same time, the intention is to support small businesses in navigating the green transition, as a third of the new loan portfolio will be green loans, which is a key objective for the EIB Group and the European Union.”
Luisa Gómez Bravo, Head of BBVA Corporate & Investment Banking, added: “At BBVA CIB we strive to become relevant for our clients by helping them to achieve their business goals with wholesale solutions, and thus contribute to a more sustainable future. With the signing of this new line, together with the EIB Group and the ICO, we continue to support the Spanish business community and are betting on promoting sustainable financing, in this case, through energy transition projects.”
Background information
About the EIB
The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It finances sound investments that contribute towards EU policy goals.
The European Investment Bank Group (EIB Group) — formed by the European Investment Bank (EIB) and the European Investment Fund (EIF) — reported another year of excellent results in Spain, with record support for climate action and environmental sustainability projects and €9.9 billion of total financing signed in 2022.
About the EIF
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, guarantees and micro-finance instruments that specifically target this market segment. In this role, it contributes to the achievement of key EU policy goals such as competitiveness and growth, innovation and digitalisation, social impact, skills and human capital, climate action and environmental sustainability.
About ICO
The Instituto de Crédito Oficial (ICO) is Spain’s national promotional bank, attached to the Spanish Ministry of Economic Affairs and Digital Transformation. It supports innovative and sustainable business projects in Spain and other markets by granting loans and other forms of financing, contributing to sustainable growth. As a national promotional bank, it offers financing to companies, particularly SMEs and the self-employed.
About BBVA
BBVA is a global financial services group founded in 1857 with over 68 million active clients and nearly 117,000 employees. The bank is present in more than 25 countries, has a strong leadership position in the Spanish market, is the largest financial institution in Mexico and it has leading franchises in South America and Turkey. BBVA contributes with its activity to the progress and welfare of all its stakeholders: shareholders, clients, employees, providers and society in general. In this regard, BBVA supports families, entrepreneurs and companies in their plans, and helps them to take advantage of the opportunities provided by innovation and technology. Likewise, BBVA offers its customers a unique value proposition, leveraged on technology and data, helping them improve their financial health with personalized information on financial decision-making.