EIB and Commerzbank cooperate to give mid-caps easier access to finance
The European Investment Bank (EIB) and Commerzbank are entering into a new cooperation in the form of a guarantee programme to support medium-sized businesses. Companies with between 250 and 3 000 employees can apply for long-term loans through Commerzbank. As part of the cooperation, a total of €400 million will be made available to these companies. The EIB will provide guarantees covering up to 50% of the loan amount.
Worldwide, access to finance for small and medium-sized businesses has become difficult due to the effects of the war in Ukraine, rising interest rates, inflationary pressure in supply chains, and the decline in the pandemic. As the banking sector responds to deteriorating credit quality with a gradual shift to low-risk assets, mid-caps are facing difficulties obtaining new financing for their business.
The cooperation between the EIB and Commerzbank will facilitate access to favourable financing conditions for mid-cap companies. The EIB guarantees will be fully beneficial to borrowers.
These guarantees are part of an EU-wide Linked Risk-Sharing Programme (LRS). This program aims to reduce some of the barriers to accessing finance through risk sharing; barriers caused by current economic uncertainties such as inflation, rising interest rates, limited external growth feeds and unsafe energy supplies.
EIB Vice-President Ambroise Fayolle, who is responsible for financing banks in Germany, said: "We are pleased to work with Commerzbank to support the key German mid-cap sector by providing guarantees for long-term loans. Together, we support projects in Germany and the European Union that are in line with the EIB's remit."
Head of Corporate Lending at Commerzbank Andreas Kern said: "The high investment needs of our corporate customers to finance the transition to sustainability in conjunction with the current global challenges require strong and reliable financing partners. We are very pleased with this partnership between the EIB and Commerzbank to support our medium-sized corporate clients long-term financing needs."
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