The European Investment Bank (EIB) has signed a €50mn facility with Northstar Luxembourg for buyer credit financing in support of European SMEs and midcap exporters.
This is the first time that the EIB is engaging in export financing. According to an EIB statement, the new programme will fill a financing gap by offering small buyer credits, bring substantial benefits to exporters by improving their working capital management, and to importers by giving them access to buyer credits on the best terms.
Luxembourg’s government, which currently holds the EU presidency seat, has contributed its export credit agency (ECA) Office du Ducroire (ODL)’s support in the operation, providing the agency’s securitisation guarantee product to the EIB.
“We believe that this unique partnership approach, combining the strengths of the EIB, the export credit agencies and Northstar, will create value and make a difference for exporting European SMEs. The EIB is and will remain committed to supporting European businesses in their internationalisation strategies,” says EIB vice-president Pim van Ballekom.
The financing scheme will be run according to standard procedures, whereby financing is provided by Northstar, using EIB’s funding, to worldwide importers of European goods under an export purchase loan agreement. The scheme has the backing of ODL under the tried and tested structures of ECA financing and with the support of the ECA of the exporters’ countries, working together in a unique European partnership model.