- Investment loans for single large investment projects
Cities and regions have a variety of financing needs. When a single large investment project needs long-term funding, the European Investment Bank (EIB) can provide dedicated project-specific loans, which are known as Investment loans. EIB lends to individual projects for which total investment cost exceeds EUR 25m. EIB support is often the key to attracting other investors. These loans can cover up to 50% of the total cost for both public and private sector promoters, but on average this share is about one-third. - Multi-component (framework) loans
Framework loans are used to finance tens or even hundreds of projects in different sectors. The projects, most frequently regarding infrastructure, energy efficiency/renewables, transport and urban renovation, are re-grouped in a multi-component, multi annual investment programmes. Framework loans are the most flexible financial instrument for cities and regions.
Conditions: The project must be in line with EIB lending objectives and must be economically, financially, technically and environmentally sound. Financing conditions depend on the investment type and the security offered by third parties (banks or banking syndicates, other financial institutions or the parent company).
Interest rates: Interest rates can be fixed, floating, revisable or convertible (i.e. allowing for a change of interest rate formula during the lifetime of a loan at predetermined periods).
Fees: In certain cases EIB may charge fees for project-appraisal, legal services, commitment, non-utilisation etc.
Currency: Most of EIB loans are in euros (EUR) but they can also lend in GBP, USD, JPY, SEK, DKK, CHF, PLN, CZK and HUF, as well as in few other currencies.
Repayment: Loan repayment is normally on a semi-annual or annual basis. Grace periods for capital repayment may be granted for a project’s construction phase.