LJUBLJANA (Slovenia), March 17 (SeeNews) – The European Investment Bank (EIB) said it has proposed a plan to mobilise up to 40 billion euro ($44.6 billion) in support of European companies, health expenditure, and the EU economy following the rapid spread of coronavirus disease.
The potential financing can be mobilised at short notice backed up by guarantees from the EIB Group and the EU budget, the bank said in a press release on Monday.
The member states should set up a significant and scalable additional guarantee for the EIB and national promotional banks to ensure that access to finance for small and medium-sized enterprises (SMEs) and midcaps remains open, EIB president Werner Hoyer said.
“This would help reassure markets and citizens at this time of unprecedented uncertainty,” Hoyer added.
"We will immediately focus on assisting SMEs and mid-caps. They badly need help, and they need it quickly. In partnership with the member states, the European Commission and other financial partners, including most notably national promotional banks, we want to develop a substantial financial package that can be rolled out straight away, without recourse to new legislation,” Hoyer added.
The proposed financing package consists of dedicated guarantee schemes to banks based on existing programmes for immediate deployment, mobilising up to 20 billion euro of financing. Some 10 billion euro are projected to ensure dedicated liquidity lines to banks to ensure additional working capital support for SMEs and mid-caps.
The proposed package also contains dedicated asset-backed securities (ABS) purchasing programmes to allow banks to transfer risk on portfolios of SME loans, mobilising another 10 billion euro of support, the EU lender noted.
The EIB also said it will use “existing financial instruments shared with the EC to finance projects that work towards halting the spread of, finding a cure, for and developing a vaccine against coronavirus.” The EIB Group’s current pipeline of projects in the health sector amounts to around 5 billion euro.
($ = 0.89652 euro)