Over 630 million euros in loans to be activated in favor of the recovery of Italian small and medium-sized enterprises and Mid-Caps affected by the effects of the pandemic, through the alternative instrument of Basket Bonds.
This is the objective at the heart of the agreement signed between the European Investment Bank and Cassa Depositi e Prestiti, an operation worth 200 million euros.
The guarantees granted by the EIB will allow CDP to invest in Basket Bond operations at reduced interest and with longer durations. Thus, over 100 companies will have the opportunity to finance growth projects through an alternative channel to the banking one, safeguarding employment levels. As pointed out by Dario Scannapieco, CEO of Cdp, "an additional and complementary tool, such as the Basket Bond, is made available to Italian SMEs and Mid-Caps with respect to traditional forms of financing".
In support of the agreement is the European Guarantee Fund (EGF), part of the package of measures approved by the EU in 2020 to counter the economic difficulties caused by the pandemic. This is the third agreement between CDP and the EIB with an EU guarantee, for a total of over 6 million euros of guaranteed loans.
The program consists of two phases. In the first, SMEs will issue bonds between 2 and 25 million euros (Mini-bonds) in favor of vehicle companies set up by arranger banks, which will underwrite them by making financial resources available. Subsequently, CDP and other investors will purchase securities backed by the same mini-bonds (ABS - Asset Backed Securities) from the same companies for an equivalent amount. The intervention of the EIB will make it possible to absorb up to 90% of any losses on each issue, and up to the achievement of a quota equal to 35% of the Mini-bond portfolios, for a maximum value of 200 million euros for the entire program. CDP estimates that new loans to SMEs and Mid-Caps can be activated for over € 630 million. The operation, said Gelsomina Vigliotti,vice president of the EIB, is "aimed at supporting the economic recovery of the Italian entrepreneurial fabric and the liquidity needs of our small and medium-sized enterprises, the driving force of the economy".
In collaboration with:
Cassa Depositi e Prestiti