KfW and EIF support akf bank to provide additional lending for SMEs and Mid-Caps

KfW and the European Investment Fund (EIF) have invested in a new securitisation transaction. The transaction, which is backed by a portfolio of loans to German SMEs originated by akf bank GmbH & Co KG, was arranged by Raiffeisen Bank International AG.

The purchase of EUR 65.9m of mezzanine notes by KfW is supported by a guarantee issued by EIF and has been carried out under ENSI, the EIF-NPIs Securitisation Initiative, which is a cooperation platform between EIF and National Promotional Institutions (NPIs), aiming to facilitate SMEs’ access to credit. The ENSI cooperation started in early 2016. To-date, twelve transactions in an amount of EUR 950m from Italy, UK, Portugal and Germany have been supported under this initiative.

The involvement of KfW and EIF allows akf bank to raise long term funding, which will be reinvested by granting new loans to German SMEs.

Last year alone, EIF committed approximately EUR 1.6bn to securitisation transactions, including support for mezzanine tranches and covering both funding and regulatory capital relief transactions. KfW provided SME funding via investments in securitisations of EUR 1.0bn in 2016.

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About EIF

The European Investment Fund (EIF) is part of the European Investment Bank Group. Its central mission is to support Europe's micro, small and medium-sized businesses (SMEs) by helping them to access finance. EIF designs and develops venture and growth capital, guarantees and microfinance 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.

About KfW

KfW is one of the world’s leading promotional banks. With its decades of experience, KfW is committed to improving economic, social and ecological living conditions across the globe on behalf of the Federal Republic of Germany and the federal states. To do this, it provided funds totaling EUR 81.0 billion in 2016 alone; and of this, 26% (EUR 21.4 bn) went into the promotion of small and medium-sized enterprises (SME) including individual entrepreneurs and start-ups. In addition to providing loans, equity and mezzanine financing, KfW supports capital market financing for SMEs by investing in related securitisations.