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The European Investment Fund (EIF) and Italian Fondo di Garanzia per le PMI, have signed a COSME agreement, which is benefiting from the support of the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe. Thus three “actors” are involved in a “combination” for supporting Italian SMES: two from the EU side (EIF and EFSI) and an Italian “consortium” headed by Fondo di Garanzia.

A billion euro is available

The counter-guarantee agreement will allow Fondo di Garanzia to support more than € 1 billion of financing to 20,000 small and medium-sized enterprises (SMEs) in Italy over the next year. Fondo di Garanzia will support Italian SMEs through the Italian Confidi (mutual guarantee societies that provide guarantees to SMEs throughout Italy).

The counter-guarantee agreement is provided under the EU COSME programme with financial backing from the European Commission.

This deal reflects the European Investment Bank (EIB) Group’s commitment to respond swiftly to calls from the EU member states, the European Commission and the European Parliament for a rapid launch of concrete initiatives under EFSI, accelerating lending and guaranteeing transactions capable of boosting jobs and growth in the EU member states.

“Combination”: participants’ opinion

EU Commission Vice-President Jyrki Katainen, responsible for Jobs, Growth, Investment and Competitiveness, underlined that Italy “was steaming ahead other EU states when it comes to SME financing” using the EU Investment Plan facilities. He reminded that Italy has had far more deals signed with the EU financial institutions than in any other EU member state.

He added that Italy’s initiative is very progressive since SMEs have been the backbone of the Italian economy and they should have easy access in financing their projects.

He expressed hope that EFSI-backed deal would enable about 20,000 new SMEs’ businesses to bring their ideas to life.

Commenting on the agreement’s signature, EIF Chief Executive, Pier Luigi Gilibert said that he was pleased with the signing of the EFSI-Confidi counter-guarantee agreement under the COSME programme.

He reiterated that the new agreement will enable 20,000 Italian SMEs to gain access to finance to create jobs and growth and develop their companies.

Carlo Sappino, Director-General of Incentives to Enterprises within the Italian Ministry of Economic Development, underlined that the ministry was both “pleased and honoured” by the counter-guarantee agreement between the EIF and Fondo di garanzia per le PMI.

He stressed that the agreement allowed for increasing business activity, in particular, at a time of the critical period in the Italian credit market. The new “instruments” provide support in the access to finances for SMEs, which are the pillars of Italian productive system.

Information about the deals’ “participating actors”

Several “actors” participated in closing the supporting deal.

= The European Investment Fund, EIF

The European Investment Fund's (EIF) is part of the European Investment Bank group. Its central mission is to support Europe's micro, small and medium-sized businesses by helping them to access finance.

EIF designs and develops venture and growth capital, guarantees and microfinance instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth and employment. EIF’s total net commitments to equity funds amounted to over € 8.8bn (by the end of 2014).

With investments in over 500 funds, EIF is a leading player in European venture and growth funds, including in the high-tech and early-stage segments. In addition to its equity activities EIF’s loan guarantees portfolio totaled over € 5.6 billion in over 350 operations (at the end of 2014), ranking it as a major European SME guarantee provider and a leading micro-finance guarantor. For more information on EIF, see: www.eif.org.  

= Fondo di Garanzia per le PMI

Fondo di Garanzia per le PMI is an Italian guarantee fund for SMEs aimed to ensure a “partial insurance to the loans granted by lenders to small and medium-sized enterprises”.

The “fund” is managed by Banca del Mezzogiorno – Mediocredito Centrale S.p.A. (BdM–MCC), on behalf of Ministero dello sviluppo economico, as head agent of the joint venture made up of BdM-MCC (Poste Italiane Group) itself, MedioCredito Italiano (Intesa Group), MPS Capital Services (MPS Group), Artigiancassa (BNL-BNP Paribas Group), and ICBPI Group.

The Fund is entrusted to a Managing Board chaired by 7 members, two representatives of the Ministry of economic development, a representative of the Ministry of Economy and Finance, a representative of the Department for development and economic cohesion, a representative appointed by the permanent Conference for relations between the State, regions and autonomous provinces of Trento and Bolzano and two experts on credit and corporate finance.

It guarantees any kind of financial operation aimed at supporting firm activity, of any maturity and sectors. The guarantee is backed by a State guarantee that provides zero-risk weight for the amount granted, with considerable improvement for banks' lending capacity.

The guarantee is issued to banks, mutual guarantee societies and other guarantee funds providing a first demand payment guarantee.

More information on the Italian guarantee fund see on: www.fondidigaranzia.it.

= Investment Plan for Europe

European Investment Plan focuses on removing obstacles to investment, providing visibility and technical assistance to investment projects and making smarter use of new and existing financial resources. The Investment Plan is already showing results. The European Investment Bank (EIB) estimates that by February 2016, the European Fund for Strategic Investments (EFSI) triggered more than €60 billion of investment in Europe.

Find out the state of play as of January 2016, including a break-down by sector and by country. For more information see the FAQs.

= COSME

COSME is the EU programme for the Competitiveness of Enterprises and Small and Medium-sized Enterprises (SMEs) running from 2014 to 2020 with a total budget of € 2.3 billion. At least 60% of the programme will be devoted to ease access to finance for SMEs in Europe, with two financial instruments. The COSME Loan Guarantee Facility supports guarantees and counter-guarantees to financial institutions to help them provide more loans and lease finance to SMEs. This facility also includes securitisation of SME debt finance portfolios.

The COSME programme also invests through the COSME Equity Facility for Growth in equity funds that provide risk capital to SMEs mainly in the expansion and growth stages.

The COSME programme builds on the success of the Competitiveness and Innovation Framework Programme (CIP) during 2007-2013, which helped to mobilise more than € 20 billion of loans and € 3 billion of venture capital to over 373,000 SMEs in Europe.

Businesses can contact selected financial institutions in their country to access EU financing; see additionally: http://www.access2finance.eu/.

Reference: Commission press release IP/16/5434, Brussels, March 2016, in:

http://europa.eu/rapid/press-release_IP-16-543_en.htm?locale=en