Further, EIB will no longer act purely as a provider of funding to Bank Austria but also, under a pilot project in association with the bank, grant low-interest loans to businesses.
The new low-interest loans from Bank Austria and the EIB are intended not only for small businesses but also for medium-sized firms with up to 3000 employees. Technology and environmental projects in particular, with a total value of up to €25m, will be financed. The loans will run for between 3 and 12 years. EIB said that, if the pilot project succeeds, further tranches would be considered.
Matthias Kollatz-Ahnen, VP of loans at EIB in Austria, said: "With this new type of loan, the EIB will be taking on some of the risk in order to give a greater boost to those segments of the market in which commercial banks want or need to have additional risk partners. It should help to mitigate the effects of the current economic crisis by granting firms better access to medium and long-term funding on favourable terms."
Helmut Bernkopf, member of management board for corporate & investment banking at Bank Austria, said: "For many years we have been cooperating successfully with the European Investment Bank. Refinancing by the EIB is particularly valuable in economically difficult times, as it enables commercial banks to make loans on favourable terms to businesses in a targeted manner, independently of the capital markets. I am pleased that we have been selected as the exclusive partner for this pilot project. This speaks volumes for our high standards in lending."