Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Federal takeover of Fannie Mae and Freddie Mac wikipedia , lookup
Financial economics wikipedia , lookup
Moral hazard wikipedia , lookup
Securitization wikipedia , lookup
Credit rationing wikipedia , lookup
Continuous-repayment mortgage wikipedia , lookup
Financialization wikipedia , lookup
Systemic risk wikipedia , lookup
Project finance wikipedia , lookup
Joint Technology Initiative for Clean Coal EU Financial Instruments Supporting the Development of Technology Initiatives Warsaw, 23 March 2007 Kim Kreilgaard Table of Content 2 1. RSFF Key Terms 2. RSFF Implementation Strategy 3. EIB Financing Risk Sharing Finance Facility RSFF – Key Terms EUR 1bn OWN RESOURCES EUR 1bn Large Corporates,Mid-caps, SMEs, turnaround situations, infrastructure SPVs, Universities and PPPs Commission: R&D R&D + I EIB Products Corporate loans, project finance Risk sharing bank facilities, funds that meet the RSFF credit profile Size of Loans Reduced to min. EUR 7.5m for direct loans/guarantees EUR 10bn in Financing Capacity 3 FP7 Beneficiaries Eligibility EIB: RSFF provisioning & capital allocation Risk Sharing Finance Facility Eligibility 1 EC Window - RTD & D 2 EIB Window - RDI Fundamental research Definition stage / feasibility studies Industrial research Pre-competitive development activity Pilot and demonstration projects Innovation Geographic Scope: EU 27 and Associated countries (Iceland, Liechtenstein, Norway, Switzerland, Israel, Turkey and Croatia) 4 Risk Sharing Finance Facility Key counterpart groups Risk Sharing with Banks Corporate /Project Finance • Targeted beneficiaries: SMEs & MidCaps (low/sub-investmentgrade) • Targeted beneficiaries: Mid-sized and large corporations (low/sub-investmentgrade), • Product Ideas: RSFF Facilites; Interest Contingent Supplier Facility, Co-financing, Global Authorisations • Product Ideas: Structured individual corporate loans for R&D projects (senior/junior debt, mezzanine) • EIB value added: Banks: risk sharing, capital relief, new customers/cross selling, Beneficiaries: risk sharing, higher debt capacity, lower financing cost • EIB value added: Lower Financing Cost, increase of debt capacity (in case of subordination), project risk sharing NEW PRODUCT DEVELOPMENTS • Targeted beneficiaries: Universities • Product Idea: Royalty fund for scientific research projects • EIB value added: Facilitate financing for universities, utilize royalty streams of research results (e.g. patents, lower financing cost Risk Sharing with Universities 5 • Targeted beneficiaries: JTIs, Technology Platforms, EUREKA Joint Ventures,… • Product Ideas: SPV based structures for individual R&D consortia • EIB value added: Provide structuring know-how (Project Financing) and facilitate private sector funding Financing R&D Consortia Table of Content 6 1. RSFF Key Terms 2. RSFF Implementation Strategy 3. EIB Financing RSFF Implementation Strategy Key objectives Extend EIB financing to new groups of counterparts through the introduction of new products RSFF Product Development Collaborate with the Commission on financing FP7 projects Synergies with ETPs, EUREKA, ESFRI etc. Pursue a sector strategy in support of RDI investments in Collaboration with lead players, platforms and intermediaries. RSFF Sector Strategy Develop co-financing and risk sharing with financial institutions for small projects / SMEs RSFF Facilities 7 Generating Projects and Portfolio Building RSFF Product Development : rationale for SMEs/ Midcaps 8 SFF Financing (low/sub-investment grade) for RDI projects Scarcity of capital is an obstacle for RDI / growth Limited debt capacity: equity gap/volatile cash-flows Limited access to capital markets Consolidation pressure + internationalisation Complementary Products Financing Needs MidCaps/ SMEs RSFF Extend Debt Capacity Subordinated Debt/Mezzanine Interest Contingent Loan Extend Lending Capacity Risk Sharing Facilities Co-financing/leverage of mezzanine funds RSFF Implementation Strategy Synergies with ETPs, EUREKA, ESFRI, etc. BENIFITS EIB ROLE European Technology Platforms (ETPs) 9 Joint Technology Initiatives (JTIs) ESFRI EIB is Privileged Bank in the dialogue for the development of ETPs, JTIs and ESFRIs Core potential financier of low/sub-investment grade ETP, JTI, ESFRI member companies ETPs provide a wide range of key players for RSFF financing ETP SRAs (Strategic Research Agenda) provides coherent framework for RDI financing EIB can leverage its pan EU focus, sector knowledge, financial engineering and advisory capabilities to the benefits of ETPs, JTIs and ESFRIs. Table of Content 10 1. RSFF Key Terms 2. RSFF Implementation Strategy 3. EIB Financing EIB Financing – Key terms General EIB Terms and Minimum Requirements Maximum loan amount: up to 50% of project cost. Loan tenors: depending on the “economic life” of the investment (generally between 10 and 20 years; exceptions). Interest Rate: Fixed or Variable Minimum size per loan: > EUR 25m for investment grade financing > EUR 7.5m under RSFF < EUR 25m Intermediated Credit Lines Projects should… 11 …be eligible for EIB finance …be technically sound …be financially viable …show accteptable returns …comply regulations (esp. environment/procurement) …have adequate security General Overview on the EIB EIB Methods of Operation Bank Intermediated Loans Bank Guaranteed Loan Direct Loan EIB lends to client’s house bank(s) passing through its low funding cost. Credit risk is born by the com. bank. EIB provides financing directly to the customer alongside other lenders as appropriate. Credit risk is born by the guarantor. EIB provides financing directly to the customer alongside other lenders as appropriate. Credit risk is shared on an equal basis with other bank(s). EIB EIB Loan Commercial Bank(s) Loan Guarantee EIB Commercial Bank(s) Loan Loan Commercial Bank(s) Loan(s) Customer e.g. Global Loan, Framework Loan 12 Customer Customer The Risk Sharing Finance Facility What can be financed ELIGIBLE COSTS Time Year 1 € 20m Year 2 € 10m Year 3 € 30m Total € 60m € 45m 13 Eligible project cost include: • Facilities: project capital expenditures for tangible assets; • Activities : project capital expenditures for intangible assets, research staff cost, incremental working capital needs and other related operating expenses. R&D budgets typically cumulated over 3 years (investment programme) MAX. EIB LOAN Up to 75% of the total project cost. Thank You ! [email protected] www.eib.org/rsff 14