EIB joins force with Santander to support Spanish SMEs affected by COVID-19

The EIB will subscribe €193 million from Banco Santander's securitisation, with the latter committing to offer financing on favourable terms to the SMEs affected by the pandemic.

The European Investment Bank (EIB) is joining forces with Santander to provide financing on favourable terms to the Spanish small and medium-sized enterprises (SMEs) and mid-caps affected by the economic impact of COVID-19. To this end, the EIB and the European Investment Fund (EIF) will subscribe several tranches of a synthetic securitisation of an SME loan portfolio originated by Banco Santander, enabling the Spanish bank to provide more than €900 million of financing to inject liquidity and support SME investments.

The EIB will subscribe €193 million from Banco Santander's securitisation, with the latter committing to offer financing on favourable terms to the SMEs affected by the pandemic. This will boost the recovery of the Spanish industry and support SMEs projects with an innovative focus, such as information and communication technologies (ICT). Part of this EIB financing is supported by the European Fund for Strategic Investments (EFSI).

In addition, the EIF (the EIB Group subsidiary specialising in SME financing) will subscribe a further €5 million from the same securitisation. Under this agreement, Santander will finance the investments of Spanish SMEs that aim to support climate change mitigation and adaptation.

The EIB Group is carrying out this operation as part of the initiatives it launched in March as a rapid response to the crisis caused by the pandemic. The EIB has also taken extraordinary measures to speed up its processes and make its internal policies more flexible in order to – among other things – deploy its support as quickly as possible and finance expenses that it would not normally cover, such as the operating costs of European businesses. The agreements signed with Banco Santander fall under this strategy.

EIB Vice-President Ricardo Mourinho Félix, who is responsible for the EU bank's operations in Spain, said: “I am very proud that my first official announcement as EIB Vice-President is the signature of an operation aimed at supporting SMEs to cope with the systemic impact of COVID-19, one of the key priorities for the EIB Group. The participation of the EU Bank in this securitisation will support Santander to mobilise more than €900 million, fostering the green investments of Spanish SMEs as well as their projects focused on innovation and digitalisation. Agreements like these are essential for driving productivity and safeguarding jobs, and for boosting a sustainable and inclusive recovery of the Spanish economy.”

European Commissioner for the Economy, Paolo Gentiloni, said: “Once more the Investment Plan is joining forces with the EIB and EIF to support lending to SMEs hit hard by the COVID-19 crisis. The newly available financing from Banco Santander in Spain will benefit a large number of small and medium-sized companies, especially those operating in the digital sector or seeking to adapt to climate change.”