News from 01-10-2013

AWS signs CIP counter guarantee agreement with EIF

On 10^th January 2013, austria wirtschaftsservice (aws) and the European Investment Fund (EIF) signed a counter guarantee agreement in the framework of the Competitiveness and Innovation Programme (CIP).  Under the terms of the agreement, aws will be able to provide guarantees to business start-ups and SMEs ranging from € 30,000 to € 2.5 million.

The guarantee volume to be provided with a CIP counter guarantee totals € 180 million until the end of 2014. The guarantee premium under this programme would be reduced by a third in comparison to a guarantee without CIP counter guarantee. For an SME with average risk rating and applying for an amount of € 250,000 would e.g. only have to pay a guarantee premium of 0.6%.

Mr. Bernhard Sagmeister, Managing Director of aws, stated that “for us it is very important to render our instruments even more attractive thanks to the combination with European funding, and we are very pleased with the intensive cooperation with the EIF, which we want to further strengthen in the future”.

The CIP agreement is a first result of the Memorandum of Understanding between the EIB-EIF group and aws, which was signed in Summer 2012. The MoU pursues the aim of supporting Austrian SMEs and improve their access to finance in the start-up, growth and expansion phases. 

EIF's central mission is to support Europe's small and medium-sized businesses (SMEs) by helping them to access finance.  EIF designs and develops venture capital and guarantees instruments which specifically target this market segment. In this role, EIF fosters EU objectives in support of innovation, research and development, entrepreneurship, growth, and employment. The EIF total net commitments to private equity funds amounted to over EUR 6bn at end 2011. With investments in over 370 funds, the EIF is a leading player in European venture due to the scale and the scope of its investments, especially in high-tech and early-stage segments. The EIF guarantees loan portfolio totalled over EUR 7.6bn in close to 220 operations at end 2011, positioning it as a major European SME guarantees actor and a leading micro-finance guarantor.

The Competitiveness and Innovation Programme (CIP), which spans from 2007 to 2013, has been put in place to boost European productivity, innovation capacity and sustainable growth, whilst simultaneously addressing complementary environmental concerns. Within the framework of the CIP, the European Investment Fund (EIF) has been allocated EUR 1.1bn to be split between venture capital – with the High Growth and Innovative SME Facility (GIF) - and guarantees – with the SME Guarantee Facility (SMEG).

Source: European Commission