Finnvera and EIB sign EUR 650m loans to support Finnish businesses
Finnvera joins the Pan-European Guarantee Fund (GEF) program of the European Investment Bank Group (EIB). On April 1, 2021, Finnvera and the EIB signed an agreement on a guarantee program which will allow Finnvera to provide a total of EUR 650 million in working capital and investment loans, mainly for financing needs large companies. This financing will be 75% guaranteed by the EIB. The guarantee program will be in effect until the end of 2021.
The Pan-European Guarantee Fund (EGF) is made up of € 25 billion in guarantees from EU member states, which are expected to trigger additional investments of up to € 200 billion for European companies. The Fund was created in spring 2020 at the initiative of the EIB Group, which is also responsible for its management. Finnvera’s share in the Fund amounts to EUR 650 million.
“The agreement is great news for Finnish companies and in particular for employees. Using EU funding, we ensure the adequacy of working capital for businesses during the Covid-19 pandemic and the advancement of investments after the pandemic has ended. I am particularly pleased with the good and lasting cooperation between the European Investment Bank Group and Finnvera, ”said Finnish Minister of Economic Affairs Mika Lintilä.
“The Fund supports businesses during the coronavirus pandemic by securing their access to financing. This will give Finnvera better possibilities to fulfill its role as a complementary financing provider in the financial markets and will also allow large companies to benefit from the Pan-European Guarantee Fund. “, says Jussi Haarasilta, executive vice president of Finnvera.
The Guarantee Fund is intended for large and medium-sized enterprises which exceed the limits of the definition of EU SMEs by having a workforce of 250 or more, an annual turnover of more than 50 million euros and a balance sheet total greater than 43 euros. million.
“The European Guarantee Fund is an opportunity for financial intermediaries and businesses across Europe,” added Thomas Östros, EIB Vice-President. “SMEs and large companies have suffered the economic fallout from measures to stop the virus. While the end of the pandemic is slowly looming, businesses will need a lot of funding to get back on the road to sustainability and stability. growth. We are happy to be able to count on Finnvera to help channel this European funding to the companies that need it.
Loans under the guarantee program will be provided directly by Finnvera. The amount of an individual loan cannot exceed 100 million euros and the duration of the loan is six years at most. More detailed terms and conditions of funding will be agreed individually for each project. In principle, the same terms will apply to the company’s other financings.
The FEM program will be valid until the end of 2021.
Finnvera strengthens the capacity and competitiveness of Finnish businesses by offering loans, export credit guarantees and other guarantees and is ready to ensure the availability of loans to viable businesses at all stages of the exceptional situation caused by the coronavirus crisis. Finnvera will continue the bank financing guarantee program and also complement the financial market with its direct loans. We recommend that businesses contact their own banks regarding their financing needs, preferably as early as possible.