alainteraillon

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1 - What is the European Investment Bank ? 2 - Which are EIB Activities in Turkey ? 3 - How is EIB financing extended ? 4 –EIB instruments for SME lending 5- EIB involvement in RDI STRUCTURE OF THE PRESENTATION

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1 - What is the European Investment Bank ?

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EUROPEAN INVESTMENT BANK European Union’s Long-Term Financing Institution: AAA rated, not-for-Profit Institution; Subscribed Capital EUR 163.7 bn; Lending in 2006 EUR 47 bn; EIB Shareholders: Member States of the EU;

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THE EIB - CAPITAL (IN PERCENT 2006)

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2 – Activities in Turkey

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FINANCING IN SUPPORT OF TURKEY First Operation in 1965 – over 40 years of Cooperation Major Projects Supported: From 1st Bosphorus Bridge to 1st Bosphorus Tunnel Support from FDI projects to SMEs Some EUR 6 bn committed, of which EUR 1.8 bn in 2006

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SIGNATURES IN TURKEY

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SECTOR SPLIT OF OPERATIONS

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Infrastructure investments: namely transport, environment and energy. Promoters will be public as well as private sector companies; 2. SME support through dedicated Global Loans with State owned and increasingly private sector banks; 3. The development of new sectors namely ICT, RDI (incl. education); 4. Industrial sector investments (investments of Turkish enterprises as well as possible FDIs). EIB lending priorities

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Growing demand for financing

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3 – How is EIB financing extended?

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Government authorities/agencies Banks Municipalities Private companies Private and public equally served WHO CAN BORROW ?

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Low cost of "AAA" rated funding benefit passed on to clients, with long maturities; in all major currencies, including YTL; for large amounts. BENEFITS OF AN EIB LOAN

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Large-scale projects (> EUR 50 million) Individual financing (co-financing or guaranteed) Small and medium-scale projects (< EUR 25 million) Global loans with partner bank FINANCING OPTIONS EIB PARTICIPATION IS LIMITED TO 50% OF A PROJECT’S COST

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Projects should: be technically sound; be economically and financially viable; comply with environmental regulations; have adequate security. PROJECT REQUIREMENTS A project assessment with many facets

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- Guarantee of Banks or Companies (min. BBB) - Sovereign lending or under state guarantee (under the EU Commission Mandate) - Financial Collateral (e.g. Government Bonds) - For lower rated structures or counterparts (i.e. without a guarantee or collateral) options under the EIB Structured Finance Facility SECURITY REQUIREMENTS

EIB’s INSTRUMENTS FOR SME LENDING: 

EIB’s INSTRUMENTS FOR SME LENDING

The European Investment Bank (EIB)Long-term Finance Promoting European Objectives: 

The European Investment Bank (EIB) Long-term Finance Promoting European Objectives SME support one of EIB priority objectives, and is done either directly by EIB (through Global Loans) or through its subsidiary, the EIF (Venture Capital, SME guarantees).

EIB’s PRODUCT OFFERING FOR SMEs (1)  The basic principle: Cooperation with the banking sector: 

EIB’s PRODUCT OFFERING FOR SMEs (1) The basic principle: Cooperation with the banking sector Bank with branch network or other intermediaries SME Global Loans Mid-Cap Loans SME SME SME SME SME Medium-long term loans

EIB’s PRODUCT OFFERING FOR SMEs (2) The activity of the EIF: 

EIB’s PRODUCT OFFERING FOR SMEs (2) The activity of the EIF Venture Capital Funds Financial Institutions Participations Guaranties SME SME SME SME SME SME Equity, mezzanine finance, loans

VALUE ADDED OF EIB GROUP’s INTERVENTION IN FAVOUR OF SMEs: 

VALUE ADDED OF EIB GROUP’s INTERVENTION IN FAVOUR OF SMEs Global Loans provide an attractive alternative to usual sources of MLT funding for the banking sector. Intermediaries are held to transfer these attractive terms to SMEs in an appropriate way, and to inform SMEs of EIB’s support in a transparent way. With its guarantee operations, the EIF shares the risk on SME portfolios with the banking sector, which allows the latter to further increase its lending activities in favour of SMEs .

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EIB PARTNER BANKS AND INTERMEDIARIES EIB Partner Banks: 1.TSKB 2.Halkbank 3.TKB 4.Vakıfbank 5.Citilease 6.Ziraatbank 7.Koçbank 8.Garantibank 9.Denizbank Approved Financial Intermediaries: 1.Garanti Finansal Kiralama 2.TEB Finansal Kiralama 3.Finans Finansal Kiralama 4.Oyakbank 5.Alternatif Finansal Kiralama 6.Deniz Finansal Kiralama 7.Şeker Finansal Kiralama 8.Fortis Finansal Kiralama 9.Tekfenbank

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EIB INVOLVEMENT IN THE RDI

RDI project types: 

RDI project types Industrial RD&I (pilot plants, labs, research activities, energy efficiency) Research programme Large Infrastructures Science parks, incubators Specific global loans for innovative SME’s Projects from Technology Platforms or FP7

EIB counterparts: 

EIB counterparts Industry (direct) Research organisations Universities Specialized intermediaries (Banks, Financial Institutions) National RDI support systems Consortia /Partner( EU Framework Programme /Eureka)

RDI financing instruments by EIB Group: 

RDI financing instruments by EIB Group The Bank provides loans Direct and indirect loans (for private or public) Global loans (for small projects and SMEs) Grouped loans / framework loans (among other for midsize companies) But debt service must be guaranteed The Fund provides capital and guarantees to intermediaries EIF investment in early stage/seed VC funds (together with other funds) EIF guarantees for SMEs (incl.mandate from Commission)

Challenges for EIB Group RDI finance: 

Challenges for EIB Group RDI finance Facts: General lack of risk finance for RDI, Loans not best instrument for supporting RDI, but can be interesting complement to equity and grants, notably in infrastructures In loans: strict limitation of risk taking by EIB, In VC: EIF can only co-fund alongside other funds

For more information…: 

For more information… http://www.eib.org/