European Investment Bank (EIB)
EIB Intermediated lending to SMEs in the EU, 2005-2011
“The evolution of a key operational priority”
18 June 2013
IEG – OECD/DAC Workshop
Evaluating Support to Private Sector Development
Bastiaan de Laat, Evaluation Expert / Team Leader
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European Investment Bank
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This presentation
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The EIB Group and SME support
•
Evaluation of EIB Intermediated SME Lending
• Scope
• Approach
• Evidence base
•
Preliminary evaluation outcomes
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EIB GROUP SME SUPPORT
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EIB Group and SME Support
• EIB Group:
• European Investment Bank (EIB)
• European Investment Fund (EIF)
• Variety of tools for SME support:
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•
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On-lending to SMEs through financial intermediaries (FIs)
Venture capital / private equity investment funds
Guarantees
Special instruments (e.g. RSFF), etc.
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A variety of products targeting SMEs
• L4SMEs
• largest volume among the SME instruments
• currently about 70 000 loans p.a. to SMEs
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EIB Intermediated lending to SMEs
EIB SME Intermediated lending 2005-2012, EU 27
Volume signed for SMEs
EUR 64 bn
Number of operations
560
Number of contracts
759
Disbursements-FIs
# FIs
EUR 53.3 bn
367
Disbursements to SMEs
EUR 47.6 bn
# “allocations” to SMEs
354 958
Source: EV Analysis of EIB data
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Geography
• ¾ of the signed EUR 64 bn volume were to the benefit
of 7 Member States
• Italy, Spain and France with 55% constitute “top-3”
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THE EVALUATION
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Scope and Policy Background
Board request 02/2010
• implementation of new
strategies with respect to
SMEs
Evaluation response
 Take account of
evolving policy context
(2005-2012)
• provide insights into the
 Systematic approach
benefits accruing to SMEs
through site visits and
SME survey
• Focus: Intermediated lending to SMEs
• Commercial, co-operative, promotional banks, leasing…
• From Global Loans (“GLs”) to “Loans for SMEs” (“L4SMEs”)
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Understanding the policy context
EU Council / Commission
EU policies / initiatives
Lisbon Strategy (2000-2010):
Regain conditions of full employment and strengthen regional cohesion
Europe 2020
More jobs & better lives
Re-launched Lisbon Strategy (2005) : re-focus on growth & employment
Modern SME Policy for Growth & Employment
- Making SMEs more competitive Action: improving SMEs growth potential
2nd Community Lisbon programme 2008-2010
- Unlocking business potential, especially of SMEs Action: Small Business Act for Europe
Short term:
Long term:
exit crisis
- access to
finance -
smart,
sustainable
& inclusive
growth
- affordable
access to
finance -
Small Business Act for Europe
- Further improve SMEs access to finance European Economic Recovery Plan
- Improve the accessibility &
availability of finance for SMEs -
. 2005
. 2006
. 2007
Article 309 of the Treaty
EIB objectives / response
“Towards a new strategy for the EIB Group”
. 2008
. 2009
. 2010
. 2011
EIB Group to modernise, simplify and broaden the
scope of its existing products, starting in 2008
EIB to sustain efforts
New priority objective:
“Support for SMEs”
- in line w/2010 signature levels -
SME consultation 2007-2008
- Increase the VA provided to SMEs -
EIB’s initiative in favour of SMEs
- Adoption of the EU definition of an SME
- New COP objective > 50% of GL in 2006
A modernised SME GL product:
EIB Loan for SMEs
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Reconstructing the Intervention Logic
Targeted (eligible) investments:
Funding
Financial
Intermediaries
Funding
SMEs
 R&D expenses
Transmission
 Working capital
 Distribution networks
…
GLs, L4SMEs
Inputs
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Activities
bps, tenor, volume…
Outputs
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Outcomes
Competitiveness
 Development, planning,
financing costs
(Revised Lisbon Strategy : 2005)
 Tangible assets
Impact
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Identifying objectives
Intermediated SME Lending
• Operational
• to extend finance to eligible SMEs (signed and disbursed to FI, then
“allocated” to SMEs by FI)
• Intermediate
• to provide such funding at improved conditions
• to improve access to finance?
• Global
• to enhance the competitiveness of SMEs, ultimately, generating a
positive impact on economic growth and employment
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Evidence base
The aim is to assess ALL links within the intervention logic (EIB, FI,
SME, wider economy), and each preferably with multiple methods
Initially, 20 operations selected
Geographic spread, number of SMEs, loan size, disbursement level,
loans vs. leasing, public vs. private, and repeat vs. single operations:
“lessons learnt”
18 different financial intermediaries (FI), 11 countries
Commercial, co-operative, promotional, leasing, etc.
Some 15 000 SMEs benefitted
Delivery mechanisms: GL => L4SME
19 in-depth evaluations
FI comparative portfolio analysis & other desk research
Interviews with FI HQ & front office personnel
74 SME site visits & interviews
Large-scale SME survey (1003 respondents)
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Six evaluation criteria
Relevance
Effectiveness
Efficiency
Sustainability
EIB Added Value
EIB Management of the operation
Each criterion for each operation rated on a 4
point scale
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EVALUATION OUTCOMES
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Main evaluation findings
Highly consistent with EU and EIB objectives
Increased relevance due to the crisis
L4SME product “says what it does and does what it says”
Higher awareness among SME about EIB origin of
funding - more comfort about funding advantage being
actually passed on (web, contract, front office, etc.)
Evaluation results trigger reflection on
Targeted vs. volume-driven instruments
Contribution to growth and employment
Fine-tuning to national SME finance needs
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Thank you!!
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