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European Investment Fund: Progress and Forecasts for Holding Fund Investments

This presentation provides an overview of the current status, progress, and forecasts for the European Investment Fund's Holding Fund investments in Europe. It covers the structure of the Holding Fund, the progress made by stage and amounts invested, aggregate forecasts for equity and FRS transactions, and important notices. The presentation also highlights the support provided through the Risk Capital Fund, Seed & Start-up Fund, and Funded Risk Sharing Product.

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European Investment Fund: Progress and Forecasts for Holding Fund Investments

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  1. European Investment Fund Riga, 24September 2010 Presentation to the SF Monitoring Sub-committee 1

  2. Overview • Current Status • Progress • Forecasts 2

  3. Current status/structure of Holding Fund Holding Fund (EUR 91.5m) Equity-related instruments Debt-related instrument Risk Capital Fund Seed & Start up Fund Funded Risk Sharing Product Swedbank EUR 22m SEB EUR 30m Baltcap EUR 20m Imprimatur EUR 14.7m Financially Engineered Instrument Selected Financial Intermediaries Signature Status = > March 26th March 26thJune 11thJanuary 22nd SMEs End Beneficiaries SME Community 3

  4. Progress by stage 4

  5. Progress by amounts 5

  6. Aggregate forecast for equity transactions, mEUR 6

  7. Aggregate forecast for FRS transactions, mEUR 7

  8. Forecast vs. Actual, H1 2010, mEUR 8

  9. Important notice • Holding fund instruments can not and must not be directly compared against other agencies instruments – this is misleading • Call for expression of interest process run by holding fund is inherrently more time-consuming than direct nomination of public agencies, because it requires much more thorough selection and due diligence as well as legal negotiations • Private fundraising for holding fund instruments is rather time consuming in crisis circumstances • Equity instruments, which have rather extended utilization pattern as opposed to debt, are not implemented by any other agency 9

  10. Summary • All transactions signed and live, financing through all instruments available to SMEs • All 4 Financial Intermediaries now well positioned to make transactions to SMEs through normal channels • First Latvian SMEs beginning to benefit from equity investment and debt instruments • More than EUR 120m expected to be disbursed to SMEs by end of 2012 10

  11. Support slide - Risk Capital Fund JHF EUR 20 m allocated Private Investment EUR 10 m Risk Capital Fund (Limited partnership) • Upside Incentivisation • No Downside protection • Professional Management SME SME SME SME SME SME SME Focus on high growth sectors 11

  12. Support slide - Seed & Start-up Fund EUR 3m allocated JHF EUR 11.7m allocated Private Investment EUR 5.7 m Risk Capital Fund (Limited partnership) Seed Fund (Limited Partnership) • Upside Incentivisation • No Downside protection • Single Professional Management SME SME SME SME SME SME SME University Spin out focus 40-50 projects Innovative Technologies focus 14-16 SMEs 12

  13. Support slide - Funded Risk Sharing Product (FRSP) EUR 52 m allocated JHF 1. Deposit to Bank(s) JEREMIE Resources EUR 52 m Combined with Bank’s own resources EUR 52 + 52 = 104 m Deposit acts as 50% co-financing 2. Loans to SMEs SME SME SME SME SME SME SME 70% focus on Manufacturing sector 13

  14. Contact details • European Investment Fund in Luxembourg 96, Blvd Konrad Adenauer, L-2968 Graham Cope, g.cope@eif.org Tel: + 352 42 66 88 236 Martins Jansons,m.jansons@eif.orgTel + 352 42 66 88 381 • European Investment Fund in Latvia Valdemara Centre, Kr. Valdemara 21, 6th Floor,LV-1010 Krisjanis Zarins, k.zarins@eif.org Tel: + 371 670 352 31 14

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