The European Investment Bank Group (EIB) and HSBC France signed two major financial agreements designed to significantly increase lending to French businesses.
The first agreement concerns a EUR 250m credit line granted by the EIB to HSBC France, which will enable HSBC's French subsidiary to lend up to EUR 500m to SMEs and mid-caps at preferential rates. HSBC France wishes the overall package to be used specifically to finance “green” projects amounting to a minimum of EUR 100m. These projects may concern (i) businesses whose activity promotes energy transition, and (ii) businesses from all sectors effecting projects to adapt their business model to the challenges of transition. The criteria applied to qualify projects as “green” are based on the French Government's EETC taxonomy (Greenfin).
The second agreement concerns a financial guarantee of EUR 200m provided to HSBC France by the European Investment Fund (EIF), the subsidiary of the EIB Group dedicated to the financing of SMEs. The guarantee will cover 50% of the loan amounts granted by HSBC France, which will then be able to dedicate an overall envelope of EUR 400m to innovative SMEs.
This guarantee comes under the EU's InnovFin programme for innovative SMEs, an initiative of EFSI (European Fund for Strategic Investments) – also known as the Juncker Plan – in order to facilitate investment in innovative enterprises, which are often considered riskier.
HSBC France will finance innovative projects that meet the EIF's eligibility criteria, with a particular emphasis on projects related to digitisation and the ecological transition of SMEs and their ecosystems.
These agreements take on particular relevance given that:
- according to a study conducted by HSBC, 59% of the customers of mid-cap clients believe that adopting sustainable practices will enhance their growth and profitability;
- according to a second study commissioned by HSBC and conducted by Kantar TNS, access to financing is considered to be the main stumbling block to investment in more sustainable development by HSBC France's mid-cap clients.
European Commissioner for Economic and Financial Affairs, Taxation and Customs Pierre Moscovici commented: “I welcome the Juncker Plan’s association with this maiden agreement between the EIB Group and HSBC France. Thanks to the Juncker Plan, almost 240 000 French start-ups, SMEs and mid-caps have already benefited from financing on favourable terms. I strongly encourage French companies to take advantage of these new sources of finance to develop their business activities.”
“This is the first operation signed by the EIB Group with HSBC France”, said EIB Vice-President Ambroise Fayolle. “It is symbolic of the EIB’s two key priorities in France: financing of the energy transition and innovation.”
“The InnovFin guarantee programme established by the European Commission under the Juncker Plan is an instrument that has from the outset proven its effectiveness in facilitating risk-taking to finance SME innovation and build Europe's future”, said EIF Chief Executive Pier Luigi Gilibert.
“The world is changing profoundly and it is our responsibility to mobilise all our resources and public-private partnerships to provide long-term support to all of our businesses, especially our SMEs. We are delighted with these two major partnerships, which are among the recent initiatives launched by the EU and France, including the creation of France Transition Ecologique”, declaredJean Beunardeau, CEO of HSBC France.
Jacques Sourbier, Head of Commercial Banking at HSBC France, remarked: “Thanks to these two facilities, we will be able to support our SMEs and mid-caps via two envelopes worth a potential EUR 900m in subsidised loans for investment. This is one of the operational responses that we wish to offer our business leaders and their ecosystems, bearing in mind that other partnerships have also been developed in the fields of innovation, digitisation and energy transition.”
This communication was first published 6 June 2019 by the European Investment Bank.