European Investment Fund Forum Binary Venture Capital Bucharest September 26

WHEN? Created in EU specialised financial body for SMEs, acting through: Venture Capital (fund of funds) and Guarantees for SME portfolios WHO ? Subscribed capital of EUR 2 billion : %: European Investment Bank - 30 %: European Commission %: 28 EU financial institutions WHY ? Art 2 : « pursuit of Community objectives » such as growth, employment, knowledge-based economy, innovation, regional development Art 24 : « generate an appropriate return on its resources » EIF at a glance

EIF SME Portfolio Guarantees allow financial institutions to… Expand lending capacity and market share in the SME segment and freeing regulatory capital at banks Reduce cost of regulatory capital by benefiting from a 20% risk-weighting on EIF-guaranteed assets under the EU’s solvency ratio directive. Reduce risk provisioning on portfolio and reduce final losses on portfolio in risk sharing schemes Triple-A rating by Standard & Poor’s and Moody’s

Venture capital- private equity portfolio: sector/stage breakdown (June 2003) EIF portfolio: sector breakdown EIF portfolio: stage breakdown European PE: stage breakdown Source EVCA

SWEDEN 3% SPAIN 8% PORTUGAL 1% NETHERLANDS 1% PANEU & MULTI 17% LUXEMBOURG 1% ITALY 12% IRELAND 4% GREECE 1% UK 14% AUSTRIA 2% BELGIUM 1% DENMARK 2% AAC COUNTRIES 3% FINLAND 4% FRANCE 15% GERMANY 10% VC/PE geographical breakdown (August Eur 2.5 bn)

 Develop operations in Acceding and Accession Countries. EIF’s activities (guarantees and VC) in the AAC will take place in close cooperation with local financial institutions and in partnership with EBRD/EIB  Develop business with shareholders, cooperation agreements or joint ventures  Management of new mandates (and increase of existing ones, e.g. EIB)  Develop new advisory services to third parties 2003 – 2005: The way forward

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