AUTOREFRESH 
EIB Details Plan To Boost Funding Via Banks But Not To Banks
BRUSSELS (MNI) – The European Investment Bank on Tuesday presented
a document to EU finance ministers outlining how it could boost lending
to the real economy via banks, but it reiterated its reluctance to
contribute cash to recapitalize the financial sector.
The EU’s AAA-rated policy-directed lender, which helps fund
infrastructure projects and lending to SMEs, told ministers that unspent
EU development aid could be put into a guarantee fund, and that this
would enable it to boost lending by E8 billion for every E1.5 billion
set aside.
The EIB also said that E1.3 billion of fresh capital from EU
governments would allow it to lend an extra E10 billion.
Taken together with a E4 billion increase in lending the EIB could
undertake with its current resources, the two measures would allow the
bank to boost its annual intermediated lending programme from E20
billion to E37 billion, an EIB official told MNI.
Under the Luxembourg-based EIB’s intermediated lending programme,
the policy bank extends a credit line to a private financial institution
to fund certain investments under the condition that the bank lends
twice as much as it receives, using its lower funding costs to subsidise
the lending.
Brussels bureau: +32495228374; pkoh@marketnews.com
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