The European Investment Bank and the Institut Català de Finances have signed a €100m loan agreement to support SME investment in sustainability and climate change adaptation and mitigation.
The European Investment Bank (EIB) and the Institut Català de Finances (ICF), a public development bank for Spain’s Catalonia region, have signed a €100m loan agreement, which is aimed at supporting small and medium-sized enterprises (SMEs) and mid-caps to make investments in sustainability and climate change adaptation and mitigation.
This is the first tranche of a total approved EIB loan of €200m. A spokesperson for the EIB told Impact Investor that a second tranche of the loan would also be aimed at supporting SMEs and mid-caps in the same way.
“The use of tranches is very standard for large investment projects and allows accommodating the availability of funds to the financing needs of the project/investment,” they said.
The loan is expected to enable the ICF to expand the range of new financing available to Catalan businesses to speed up their green transition and help create a more sustainable and competitive economy. This includes investments in areas such as renewable energy, energy efficiency, electric vehicles, the circular economy and sustainable waste management.
Vanessa Servera, CEO of ICF, said: “EIB support has enabled us to offer Catalan SMEs better financing conditions so they can implement projects and investments directly, helping to meet climate goals and driving competitiveness. Small and medium companies are key to our economy and, for this reason, ICF wants to act as a strategic ally in their transition to a more sustainable and responsible business model.”
Strategic partnership
Discussing the EIB’s partnership with the ICF, the EIB spokesperson said that the organisation plays an important role in promoting regional development and social cohesion in Catalonia.
“ICF and EIB maintain a long-standing partnership to support economic development, green and digital transition and SMEs competitiveness among others,” they said, giving the example of other recent financing agreements with the ICF, including a €100m loan announced in May to support the development of care homes, day centres and assisted living facilities for the elderly, people with disabilities and other vulnerable groups in the region.
Last July, the EIB also signed a €490m loan agreement to finance the construction of affordable rental housing with high energy efficiency standards in the Catalan region.
“This new agreement will provide ICF with additional resources to be allocated to SMEs undertaking sustainable investments,” the spokesperson said.
Impact measurement
The EIB spokesperson said that the bank monitors projects from the signature of a loan contract through to project implementation and the operation phase up until a loan is paid back.
“Monitoring requirements are determined according to the characteristics of each project. In particular, the Bank monitors the servicing of the loan, checks that the funds are being used in line with the objectives and projections and keeps itself informed of developments concerning the promoter and its partners.
“In the case of intermediated financing to SMEs and mid-caps, part of these tasks are undertaken by the financial intermediary (ICF), who commits to allocate funds according to certain previously defined criteria.”
