BNL ENHANCED SUSTAINABLE SME AND MIDCAPS SUPPORT

Promoter – Financial Intermediary

BANCA NAZIONALE DEL LAVORO SPA

Location

• Italy

Description

The operation consists of a guarantee Banca Nazionale del Lavoro (BNL) to support lending to small and medium sized enterprises (SMEs) and mid-caps in Italy. In detail, it consists of a mezzanine tranche of granular portfolio of SME, mid-cap and and large corporate loans.

Additionality and Impact

The operation supports the financing of SMEs and Midcaps in their recovery after Covid19 but now facing the challenges of high inflation, increasing interest rates and surging energy costs following the geopolitical crisis triggered by the Russian invasion of Ukraine. New credit lines are crucial to provide financial support to SMEs and Midcaps whose own existence is at risk again in the coming months mainly due to raising energy costs and disruption to the supply chain.

Moreover, the Italian economic fabric is also facing the challenge of the Climate change and the call for a sustainable green transition as per the Italy's Decarbonation Strategy by 2030. In this regards, the operation will be targeting Climate Action and Environmental sustainability's projects in the field of renewable energy production and energy efficiency. The main Climate action element of the operation, renewable energy and energy efficiency projects, reduces negative carbon and air pollution externalities and increases comfort and air quality in the dwellings, social and public benefits that are not fully internalised by private investors.

The EIB participation is hence critical in a negative economic context when the SMEs and MidCaps are likely to lower their investment activity and plans, and is also innovative considering the type of operation which generate a capital benefit to the Financial Intermediary which is able to generate multiplied portfolios of lending to eligible final beneficiaries.

Objectives

The aim is to enhance access to finance for the specific market segment. In detail, the transaction, an unfunded mezzanine investment, is a de-linked product aiming at relieving capital on an existing loan portfolio, which will be redeployed into new financing. This operation will also contribute to accelerate the sustainable transition of SMEs and mid-caps in Italy through the origination of a green and climate action new portfolio of projects to improve energy efficiency and reduce CO2 emissions.

Sector(s)

• Credit lines - Credit lines

Proposed EIB finance (Approximate amount)

EUR 87 million

Total cost (Approximate amount)

EUR 700 million

Environmental aspects

The EIB will require that Banca Nazionale del Lavoro S.p.A. take all the required measures to ensure that final recipients (SMEs and Midcaps) meet EIB's environmental standards and related EU/national legislation.

Procurement

The EIB will require that Banca Nazionale del Lavoro S.p.A. take all the required measures to ensure that final recipients (SMEs and Midcaps) meet EIB's procurement standards and related EU/national legislation.

Status

Signed - 22/12/2022