Belgian regional investment companies to extend over €600 million in new lending for SMEs thanks to EIF and InvestEU

• EIF guarantees for Belgium's three regional investment companies, PMV, Wallonie Entreprendre, and finance&invest.brussels will enable up to €608.5 million in financing.
• The agreements were made possible with the support of the InvestEU programme, which aims to trigger more than €372 billion in additional investment over the period 2021-27.
• The lending will focus on different thematic areas in the regions, including seed financing, start-ups and lending for innovation and sustainability initiatives by small companies.

The European Investment Fund (EIF) has signed four new guarantee agreements with PMV Group, Wallonie Entreprendre (WE), and finance&invest.brussels, backed by the European Union's InvestEU programme. At a signature ceremony in Brussels today, the separate deals with the Belgian regional promotional investment companies were signed to unlock €608.5 million in new financing for small companies across Belgium, ranging from microfinancing to small mid-caps.

With a focus on the Brussels Capital Region, finance&invest.brussels group will receive a direct guarantee for up to €78 million in new lending to small businesses. The InvestEU backing for this transaction focuses on SME competitiveness and sustainability. Specifically, finance&invest.brussels will dedicate itself to supporting seed financing as well as backing start-ups with subordinated lending.

In Flanders, a direct EIF guarantee with PMV Group will cover a loan portfolio of €132.5 million. The transaction is supported by the InvestEU programme to enhance SME competitiveness and sustainability, increase support for the cultural and creative sector and promote microfinance. PMV will make available subordinated loans in the whole Flemish region, with a focus on microenterprises, start-ups, self-employed entrepreneurs and companies in the media sector.

Wallonie Entreprendre signed two separate InvestEU-supported transactions with the EIF, guaranteeing nearly €400 million in new lending for nearly 2 500 Walloon businesses. A direct guarantee will cover a portfolio of €28 million in loans. A counter-guarantee, under which Wallonie Entreprendre will itself guarantee portfolios of loans by other financial intermediaries, is expected to generate up to €370 million in new lending for small entrepreneurs. InvestEU backs these transactions with a view to improving SME competitiveness through both guarantees, and focuses on innovation, digitalisation and sustainability under the counter-guarantee structure.

Background information

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its main goal is to support microenterprises and SMEs by helping them to access finance. The EIF designs and develops venture and growth capital, guarantees and microfinance instruments that specifically target this market segment. In this role, the EIF contributes to the pursuit of key EU policy objectives such as competitiveness and growth, innovation and digitalisation, social impact, skills and human capital, climate action and environmental sustainability.

The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union's policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together under one roof the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient, and more flexible. The programme has three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that will invest in projects using the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increase their risk-bearing capacity and thus mobilise at least €372 billion in additional investment.

finance&invest.brussels is a public limited company that facilitates and completes the financing mix for Brussels-based companies with a clear focus on key sectors that promote sustainable economic development and job creation. The company provides concrete solutions to the financial needs of entrepreneurs, in the form of loans, capital or guarantees, at decisive moments in their journeys. These financing solutions are aimed at start-ups, scale-ups and SMEs as well as very small social entities and cooperatives.

PMV is a Flemish investment company shaping the economic future of Flanders. PMV finances promising companies from early start-up through growth and internationalisation. PMV offers tailored financial solutions to all entrepreneurs with a good business plan and a strong management team through capital, loans and guarantees. In cooperation with various partners, PMV also carries out projects with and for the government, which are important for prosperity and well-being in Flanders. PMV has a portfolio with €1.7 billion under management.

Wallonie Entreprendre contributes to Wallonia's economic development through awareness programmes and by supporting and financing Wallonia-based companies in a wide range of sectors, including life sciences, deeptech, energy and aerospace. It provides, alongside private investors, equity and debt financing to companies of all sizes and at different stages of their development. In doing so, WE contributes to the development of ecosystems in order to generate employment, create value and attract further investment.

Quotes

European Commissioner for the Economy Paolo Gentiloni said: "InvestEU is a key instrument for providing necessary funding to small and medium-sized businesses across Europe. These four agreements will boost financial accessibility for small businesses in Belgium, underlining our commitment to their growth and job creation potential. They will promote regional development, enhance competitiveness, foster innovation and support employment.”

“Transactions like this one build a bridge between very local realities and what Europe can do to financially support ambition and entrepreneurship.” commented Roger Havenith, deputy Chief Executive of the EIF. “The EIF has been supporting Belgian small businesses in all regions of the country since its inception and will continue to expand its offering for financial intermediaries both in terms of sector-specific products and with transactions that focus specifically on climate action.”

EIB Group Vice-President Kris Peeters added: “Belgians are very creative people, but that alone will not guarantee the success of a business. Regional promotional investment companies play a pivotal role in Belgium in making ideas come to life and we're very happy that, thanks also to the European Commission's InvestEU programme, the EIF is able to channel financing to where it's needed.”

finance&invest.brussels CEO Pierre Hermant emphasised: “We are delighted to have these guarantees in place, which will enable us to continue supporting the Brussels ecosystem. This programme supports the transition to a more sustainable economy for the Brussels Region.” Deputy CEO Franc Bogovic added:“This new guarantee further boosts Brussels' role as a key regional hub for start-ups and allows us to support early-stage initiatives.”

General Manager of PMV Michel Casselman confirmed:“The EIF guarantees have shown to be an important lever for our Flemish small businesses. The system of sharing risk between the European and local levels has proven to be a real facilitator in attracting private funding for our companies, including for sectors that are usually considered too risky. The guarantees are therefore the perfect illustration of the complementarity of public funding responding to the needs of the private market.”

Wallonie Entreprendre's Executive Committee member Jean-Pierre Di Bartolomeo added: “This unique type of financing, combining European and regional funds, will enable our businesses to develop further, grow, go international and create jobs. This product is in line with our ambition to stand by our businesses in our three regions and is also perfectly in line with Wallonia's Recovery Plan, which is largely focused on business development.”