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European Investment Bank
Leadership and Management in Sustainable DevelopmentEuropean Summer School
Suor Orsola Benincasa University of Naples, 10th July, 2013
Promoting Sustainable Development&
Supporting the Recovery
The European Investment Bank
Brian G. FieldUrban Planning and Development Adviser
The European Investment Bank
2European Investment Bank
Problems in financing infrastructure projects
Even where underlying investments are sound, in the post crisis environment, projects can face difficulties in accessing finance:
Heightened degree of risk aversion by commercial banks
Deteriorating credit rating/debt ceilings
Difficulties for smaller private-sector providers to access finance
3European Investment Bank
EIB – Supporting projects promoting EU objectives
EU’s financing arm, established by the Treaty of Rome in 1958
EIB’s shareholders are the 27 EU Member States
Promoting EU objectives
Providing long term loans to the private and public sector, in a broad range of currencies
Total lending in 2011: EUR 60.9bn
Total lending in 2012: EUR 52.2bn
(EUR 79.1bn in 2009)
Large increase a consequence of the financial crisis (after a specific mandate from ECOFIN)
4European Investment Bank
Objectives and Instruments(a response to the financial crisis)
Objectives
Broadening the financing base for infrastructure investments
Increasing awareness and deepening the financial sector servicing such development needs
Harmonising and coordinating resources
Instruments
Medium to long-term senior loans
Subordinated loans
Letters of credit
Guarantees
Mezzanine debt instruments
Local debt securities
Equity
Technical Assistance support
5
Funding strengths and value for customers
European Investment Bank
Funded mainly through bond issues on international capital markets, exploiting strong market positioning
Passing on funding advantage to loan customers
Not for profit (but also not for loss)
Large and frequent international bond issuer…EUR 71.3bn issues in 2012
6European Investment Bank
Typical Funding Instruments
Investment Loans.
Framework Loans.
Global Loans.
Funds.
7European Investment Bank
EIB Signatures 2012 (in EUR)
8European Investment Bank
The Leipzig Charter
SUSTAINABLE
COMMUNITIES
Innovation and education policiesHigh quality
public spaces
Infrastructure networks and energy efficiency
Regenerate deprived neighbourhoods
Improve physical environment
Training for children and the young
Local economy and labour
market policiesEfficient affordable
transport
9European Investment Bank
Overcoming FragmentationIntegrated Planning
An integrated approach to territorial development for effective improvement in the socio-economic conditions of settlements, whatever spatial scale, requires identification of the co-operating elements of infrastructure investment with the evolution of the social capital that should be developed simultaneously in the areas where applied.
10European Investment Bank
Integrated Planning and EIB’s Three Pillars
A project assessment with many facets, but three key elements in the appraisal process.
Eligibility, i.e. consistency with EU priorities.
Technical quality and economic soundness.
Financial viability and adequate security.
Projects must also comply with EU procurement, environmental and social protocols.
11
The EIB Project Cycle
13/04/2023 11
12European Investment Bank
Benefits of an EIB loan
Large amounts
Broad range of currencies
Long maturities
Attractive interest rates
Catalyst for participation of other banks or financial partners
13
Value Added of the Bank’s Activities
European Investment Bank
Support for EU priority objectives
Project quality and soundness
Financial benefits of EIB funds
Technical assistance
Project assessment
14
Facilitating the Recovery
An enhanced role for EIB is not the solution to the crisis, but should certainly be part of the solution.
European Investment Bank
A capital injection of €10 billion
Leverage for significant additional borrowing and associated lending opportunities
Focus on the EU for the creative and sustainable deployment of additional funds
Promoting growth, sustainable development and employment generation
15
Promoting European Objectives
European Investment Bank
Evolution of EIB lending activity
The EUR 10bn paid-in capital increase will enable a 40% lending growth over the base signature level foreseen in the Operational Plan 2012-2014
16
Priority objectives for additional funding
European Investment Bank
Convergence
Small and medium-sized enterprises (SMEs) and mid-cap enterprises
Environmental sustainability
Knowledge economy
Trans European Networks (TENs)
Sustainable, competitive and secure energy
17
Some Ingredients for Successful Projects
European Investment Bank
Informed by a clear plan and/or development strategy.
Commitment of, and clear benefits for, all relevant stakeholders both public and private.
Exploits the comparative advantage of its locality.
Promotes accepted best practice in sustainable development.
Exploits innovative financial instruments and, where/when appropriate, takes advantage of technical assistance.
18European Investment Bank
EIB CONTACT INFORMATION
Brian G. FieldRegional and Urban Division
European Investment Bank100 boulevard Konrad Adenauer
L-2950 LuxembourgTel: +352 4379 83063Email: b.field@eib.org
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