CIP

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European Commission
Economic and Financial Affairs DG - Luxembourg,
Unit L2
CIP Financial Instruments Leverage Effects
James Mc GING Head of Unit, ECFIN-L2
Presentation on the occasion of the EIP
Management Committee meeting, Brussels, 26 June
2008
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How does GIF work?
Other Investors
Investments
Other Investors
SME
SME
SME
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CIP financial instruments - RISK CAPITAL (GIF)
principles

• PRE-SEED EARLY STAGE (GIF1)
• SMEs lt 10 years
• Focus on high growth potential
• Support co-investment with business angels
• Typically up to 25 EU investment
• (adjusted for non-eligible beneficiaries)

• EXPANSION STAGE (GIF2)
• Lower EU intervention
• More sizeable VC funds
• Typically up to 15 EU investment
• (adjusted for non-eligible beneficiaries)

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Venture Capital Instruments Achievements
Leverage Effects
Fund level total MAP
5,65 of total funds for 1 of EU funds
committed
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Venture Capital Instruments Achievements
Leverage Effects
SME level Skype Example
EU Investment EUR 10 M EU Share 19,5 EU
Leverage (fund level) 15
Fund Investment EUR 1,4 M EU Investment EUR
0,3 M Fund Share 5,5 EU Share 1,1 EU Leverage
(SME level) 192
Other investors
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Management Mandate

• How
• Does
• SMEG
• work

EU Guarantee
EU Counter- Guarantee
Financial Intermediary Guarantee Institution
Guarantee
Direct lender
Debt financing
SME
SME
SME
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CIP Financial Instruments leverage effectsCase
study direct guarantee operationsCase of a bank
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CIP Financial Instruments leverage
effectsExample Loan portfolio after EU
intervention Case of a bank
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CIP Financial Instruments leverage effectsCase
study direct guarantee operations
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CIP Financial Instruments leverage
effectsExample Loan portfolio after EU
interventionCase of a guarantee organisation
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Achievements of ancestor programme MAP- leverage
effects
Enhanced access to finance for SMEs
Additionality of SMEs Guarantees under MAP
SMEs Guarantees under MAP
As of 30 September 2007 - Data based on
figure provided by the European Investment Fund
(EIF)
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CIP Financial InstrumentsProjects approved/in
the pipeline
Very strong pipeline
Status 15 May 2008
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