Finnish companies to receive financial support worth EUR 300 million

The EIB and OP seek to support businesses recover from the effects of the pandemic

On 10 May, the European Investment Bank (EIB) announced that it has signed a guarantee with OP Corporate Bank to help Finnish businesses recover from the impact of COVID-19. More specifically, the EIB and OP will help mid-sized companies in Finland by bringing EUR 300 million of new financing under the European Guarantee Fund programme.

What is the European Guarantee Fund (EGF)?

The EGF was set up by the EIB to help businesses which have been negatively impacted by the pandemic. According to a press release by the EIB, this fund uses nearly EUR 25 billion in guarantees; in this way, it allows the EIB and EIF to make guarantees, loans, etc. to small and medium-sized businesses in need of financial support.

EIB Vice-President Thomas Östros commented on this fund and the new financing as he shared: “The pandemic has put all sectors under severe stress, and Finnish businesses are no exception. The European Guarantee Fund works as a protection shield for companies, to help them finance their way out of the crisis under more favourable conditions.”

How will the new financing work and who is eligible for support?

The EIB and OP will help Finnish companies by encouraging them to make new investments and borrow money. In doing so, they aim to promote sustainable growth and help them overcome the numerous challenges they have faced as a result of the COVID-19 crisis.

This new financing is targeted at mid-size companies with 250-2,999 employees as well as small enterprises with 0-250 employees. In addition to this, the EIB reports that businesses must have a net sale and balance sheet total exceeding EUR 50 million and EUR 43 million, respectively. Finally, it notes that the loan maturity must not exceed 6 years.

Through this new financing, the EIB and OP seek to ensure the speedy recovery of Finnish companies. Moreover, it aims to close the investment gap which has been caused by the outbreak of the pandemic. Thus, this financial support will massively contribute to the country’s economic recovery.