The EIB and the financing of innovation Madrid, 28th October 2016
European Investment Bank Group 2
The EIB
2
Larger multilateral lender in the world
Financing approx. 450 projects a year in over 160 countries
Headquartered in Luxembourg with 33 local offices
Close to 3000 staff (financial specialists, engineers, economists, social and environmental standards specialists
Largest supranational borrower in the world
Raised € 62.4 billion from capital markets in 2015
AAA rating
Subscribed capital of € 243 billion
EU’s policy-driven, long-term lending institution since 1958
Our shareholders are the 28 EU Member States
EIB lending in 2015: EUR 77.5bn (EIB signatures)
European Investment Bank Group 3
We deliver impact where it’s needed
European Investment Bank Group 4
HEALTH 9.8m people with
access to improved health services
JOBS 4.1m jobs in small
businesses
EDUCATION 1.5m students
benefiting from EIB projects
WATER 21m people
benefiting from safe drinking water
TRANSPORT 380m additional
passengers
ENERGY 2.3m households
powered by EIB projects
URBAN 3.2m people
benefiting from urban upgrades
DIGITAL 15.3m people with new or upgraded
connections
Capacity for change: innovation Europe’s R&D intensity is persistently lagging behind that of other leading economies, hampering the EU’s ability to innovate
Source: OECD
Gross domestic expenditure on R&D (in percent of GDP)
EU
US
Japan
South Korea
0
1000
2000
3000
4000
2000 2002 2004 2006 2008 2010 2012
Patent Applications (Number per 1 million inhabitants)
Source: World Intellectual Property Organization; Comparability across countries is limited due to differing patenting systems.
An additional € 130bn a year needs to be invested in R&D to meet the EU target of 3% GDP.
More than 30% less patents are filed per EU citizen than per US citizen.
EU
USA
JPN
KOR
CHN
0
1
2
3
4
2000 2002 2004 2006 2008 2010 2012
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6
Historical Lending in innovation 2000-2015
2.2 bn
5.1 bn
3.6 bn
6.2 bn
7.1 bn
10.7 bn 10.9 bn
10.2 bn
12.5 bn
18.3 bn
16.5 bn
10.4 bn 9.3 bn
15.6 bn
13.4 bn
16.1 bn
18
37
27
48 45
56 57 55
73
95
95
66 76
104 108
123
0
20
40
60
80
100
120
140
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Tota
l num
ber o
f ope
ratio
ns
Tota
l Len
ding
vol
ume
(EU
R m
)
Total Lending 2000-2015: EUR 168 bn
European Investment Bank Group
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Innovation Lending 2000 - 2015
Total: EUR 168
bn
Education 33 bn 20%
Automotive & Aircraft 32 bn 19%
Telecommunications & Media 32 bn 19%
Public Sector Research 16 bn 9%
Framework & Global Loans 16 bn
9%
Manufacturing & Process Industries
15 bn 9%
Med. Tech. & Pharma 8 bn 5%
IT & Electronics 6 bn 4%
Hospitals & Health care 5 bn 3%
Energy 4 bn 2%
Science Parks & Research Infrastructure
2 bn 1% Misc.
330 m 0%
Sector breakdown
European Investment Bank Group
Investment Plan for Europe: context
The Investment Plan for Europe consists of three strands: 1. Improved investment environment: regulatory and structural
reforms at EU and national levels for predictability, removing obstacles, aiming at a friendlier investment environment
2. Making finance reach the real economy: enhanced EIB-EC-MS cooperation on project identification (the “Project Directory”) and stepped-up technical assistance / advisory
3. Mobilising finance for investment: The EFSI, via EIB, to better address the current shortage of (higher) risk-financing in EU
Aim: to mobilise at least €315 billion in investment across the EU
European Investment Bank Group 8
Mobilising new investment
EFSI EIB Group
European Investment Bank Group 9
10 European Investment Bank Group
Types of deals: overview
Debt portfolio
Corporate Senior
Corporate Junior
Project Finance Senior
Project Finance Junior
Senior Debt Risk Sharing Large Innovation Projects Turnaround Financing
Credit enhancement Mezzanine / Sub-debt lending Hybrid debt Risk Sharing Contingent equity
LT senior debt
Credit enhancement Other guarantees
Product examples Equity portfolio
Indirect equity (ETP)
Direct equity-type (ETI)
Infra funds EU Co investment in projects Corner stone investor new funds
Project participation Mid cap ETI
Product examples
10 European Investment Bank Group
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What kind of operations?
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Commercially Sound
Economically Viable
Technically Viable
+ Additional EFSI Eligible Pricing
Support Growth / Jobs
Cover EU 28
Cross Border
European Investment Bank Group
12 European Investment Bank Group
Key areas
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Strategic Infrastructure (Transport/Energy/Digital)
Innovation (Education/Training/Health/RDI)
Environment + Renewable Energy
SMEs / Mid-Caps
European Investment Bank Group
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InnovFin Product Overview
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InnovFin SME Guarantee
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This guarantee
instrument covers
the risk related to
losses of a portfolio
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InnovFin Venture Capital
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TT, VC and BA Funds and co-investment Funds
focusing on companies in Early Stage
Focus on Horizon 2020 objectives
(e.g. ICT, life sciences, clean energy, technology)
Enterprises in pre-seed,
seed, start up phases (seed & A rounds included)
First 4 transactions signed as of February 2016.
Open Call for Expression of Interest until 30/09/2020
Investment size up to EUR 30m
up to 50%** of total commitments (CATALYTIC)
Pari-passu, at least 30%* investment from private
investors
* 10% in the case of BA Co-investment Funds ** Up to 70% in the case of BA Co-investment Funds, subject to conditions.
16 European Investment Bank Group
InnovFin: Mid-Cap Guarantee
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EIF Financial Intermediary
Innovative Mid-Caps
3,000 employees
New Loans
50% Guarantee EUR 25m
50% loss coverage for new mid-cap loans of up to EUR 50m not covered under InnovFin SME Guarantee
Can be complemented with EIB funding (global loan)
Pari-passu sharing of risk and pricing
Full delegation to financial intermediaries
Favourable capital treatment
17 European Investment Bank Group
InnovFin Mid-Cap Growth Finance
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Direct long term debt and mezzanine finance: EUR 7.5m – EUR 25m
Loans can be structured as economic equity (silent participation)
For innovative Mid-Caps and SMEs (eligible counterparty concept)
EIB can finance up to 50% of all investments over 3 years
Streamlined EIB approval process
EIF Innovative Mid-Caps
3,000 Employees
Growth Finance / Mezzanine EUR 25m
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MGF transactions signed to date
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1
2
3
4
5
6
7 8
9
10
11 13
12
16
14
17
18
20
23
Signature pipeline for Q1 2016
24
Quasi-equity
26
1
EVS (2013) EUR 12m Senior term loan
25
2
Marposs (2013) EUR 25m Senior term loan
3
Rovio (2014) EUR 25m Senior term loan
4
Manz (2014) EUR 20m Mezzanine loan
5
Pharmathen (2014) EUR 25m Senior term loan
6
Welltec (2014) EUR 25m Senior term loan
7
Pramac (2014) EUR 8m Senior term loan
8
Maier (2014) EUR 7.5m Senior term loan
9
E-Net (2014) EUR 12m Subordinated loan
Novabase (2014) EUR 14m Senior term loan
Marangoni (2014) EUR 10m Senior term loan
Innocoll (2015) EUR 25m Quasi-Equity
Saes (2015) EUR 10m Senior term loan
Planon (2015) EUR 12m Senior term loan
Kiosked (2015) EUR 15m Quasi-Equity
Danobat (2015) EUR 10m Senior term loan
Biosurfit (2015) EUR 12m Quasi-Equity
Jennewein (2015) EUR 10m Quasi-Equity
Doppelmayr (2015) EUR 25m Senior term loan
Gigaclear (2015) EUR 25m Quasi-Equity
Punch (2015) EUR 25m Senior term loan
Figeac (2015) EUR 25m Senior term loan
Qwant (2015) EUR 25m Quasi-Equity
eVision (2016) EUR 13.5m Quasi-Equity
MAM (2016) EUR 25m Senior term loan
NEWICON (2016) EUR 8m Quasi-Equity
10
11
12
15
17
18
20
23
24
26
13
14
16
19
21
22
25
15
Archos (2016) EUR 12m Quasi-Equity
System Group (2016) EUR 15m Senior term loan
27
27
28
28
22
21
19
Creta Farms (2016) EUR 15m Quasi-Equity
EFSI
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Priorities
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EIB in Spain
EUR 11.9bn signatures in 2015
For 12 consecutive years, Spain has been the country that receives the largest volume of EIB financing
Of which EUR 8bn to SMEs
75,000 beneficiary SMEs in Spain only in 2015
EFSI signatures in 2015 of EUR 415m
Support to R&D, gas networks, and port infrastructures
Early stage of EFSI implementation
Thank you!
European Investment Bank Group 20