European Investment Bank (EIB) has concluded a loan agreement worth EUR300m with banking groups KBC Group and CBC through its ‘Loans for SMEs’ program. KBC, CBC will use their network of bank branches to make the EIB funds available to small and medium-sized enterprises (SMEs) in Belgium as early as this summer.
EIB has said that its loan for SMEs will take the form of a credit line that KBC and CBC will onlend to small businesses with fewer than 250 employees across a range of economic sectors eligible for EIB financing.
The projects, to be eligible for this specific type of funding must meet certain pre-set criteria amongst which being carried out and located in the European Union and being aimed at growth. They may also not consist of refinancing or purely financial or property transactions.
Jan Vanhevel, president of the executive committee of KBC Group, said: “At a time when our economy is showing the first signs of recovery from an unprecedented financial-economic crisis, the like of which has never been witnessed before, it is essential that an integrated bancassurance group like KBC takes full responsibility for fueling economic growth in its home markets.
“I am therefore delighted that we are in a position to enjoy the support of such a reputable institution as the EIB and that we can use these funds to supplement our other financing instruments.”
Through its ‘Loans for SMEs’ program, the EIB makes funding available to SMEs in Europe to support their investment projects. To ensure these loans reach the enterprises, the EIB uses the services of European commercial financial institutions, acting as intermediaries.