The European Investment Bank Group (EIB Group), comprising the European Investment Bank (EIB) and the European Investment Fund (EIF), has participated in a mortgage bond and a securitisation transaction arranged by Sabadell, investing a total of €822.5 million.

The investment will enable Sabadell to mobilise €1.8 billion to finance the liquidity and investment needs of small and medium-sized enterprises (SMEs) and mid-caps in Spain.

“Sabadell’s mortgage bond will help companies access financing to cover their liquidity needs and make investments, with a portion of the funds earmarked for green projects,” said EIB Group.

“This financing will mainly go to companies in cohesion regions, where per capita income is below the EU average. The EIB is investing €500 million in this bond, enabling Sabadell to unlock around €1 billion in new financing for small and medium businesses and mid-caps.

“Of this €500 million, up to €180 million is earmarked for projects by companies affected by the floods that hit Spain at the end of 2024, and for preventive measures to avoid future flooding.

“Additionally, up to €138 million will be allocated to financing small and medium businesses, mid-caps and public sector entities such as irrigation associations operating in the agricultural sector. This financing for irrigation communities will enable Sabadell to support projects led by public sector entities in Spain to rehabilitate, modernise and upgrade existing infrastructure for more efficient water use.

“The securitisation transaction will also channel financing to cover the working capital and liquidity needs of small and medium businesses and mid-caps, while improving their access to vital investments that strengthen competitiveness.

“The EIB Group has invested €322 million in this securitisation transaction, with €270 million contributed by the EIB and €52.5 million by the EIF in the senior tranche.

“The EIF investment also features a green component under which Banco Sabadell will put together a portfolio of green loans totalling over €52 million. The securitisation meets the simple, transparent and standardised (STS) criteria in line with EU securitisation standards, helping to foster a robust and efficient capital market.”