The European Investment Bank (EIB) and Bank of Valletta have announced a new partnership to strengthen access to finance for medium-sized companies in Malta. Under the agreement, unveiled on Friday, 14th July 2025, by EIB Vice-President Kyriacos Kakouris and Bank of Valletta Group CEO Kenneth Farrugia, the EIB will provide a €30 million guarantee to support the creation of a new lending portfolio of up to €60 million. This is made possible through a linked risk-sharing structure that facilitates financing for newly originated transactions with eligible large mid-cap beneficiaries. Highlights of the scheme include:
- EIB provides €30 million guarantee to support Bank of Valletta's lending to Maltese medium-sized companies
- Operation expected to generate up to €60 million in new financing under a linked risk-sharing structure
- Initiative strengthens mid-cap access to finance and supports long-term economic resilience in Malta
This initiative is designed to enhance the working capital and investment capacity of Maltese mid-sized firms, which play a critical role in the country's economy and job market. They are critical to Malta's economic resilience, innovation, and employment landscape. The new facility will help address liquidity gaps and unlock new opportunities for growth.
EIB Vice-President Kyriacos Kakouris said, "This agreement is a strong example of how the EIB and commercial banks can work together to strengthen Europe's local economies. By partnering with Bank of Valletta, we are channelling fresh financing to Maltese businesses that contribute to drive growth, innovation, job creation, and long-term sustainable development in Malta."
Eligible companies will benefit from more favourable financing conditions, such as increased funding volumes, and favourable terms and conditions. For Bank of Valletta, the risk-sharing arrangement enables more efficient use of capital and balance sheet capacity, allowing for additional lending to the real economy. The operation also helps reduce risk-weighted assets and supports the bank's strategic goal of enhancing credit access for local businesses.
Kenneth Farrugia, elaborated further by saying, "As Malta's leading financial services provider, we are committed to supporting the growth ambitions of local businesses. This strategic partnership with the European Investment Bank is the first of its kind in terms of risk sharing instruments targeted at larger mid-sized firms, a vital segment of the Maltese economy. The risk-sharing structure not only boosts our lending capacity but also improves access to credit for businesses seeking to innovate, invest, and scale up their operations. This initiative directly supports our mission to foster long-term economic sustainability and empower local enterprises to thrive in a dynamic global environment."
This operation is in line with Bank of Valletta's long-standing role as a key enabler of national economic growth. With a wide-reaching branch network and deep roots in the local economy, BOV continues to support large midcaps through tailored financial solutions and strategic collaborations, such as this agreement with the EIB.
The EIB in Malta
The European Investment Bank (EIB) has been supporting the Maltese
economy since before the country's accession to the European
Union, with its first project signed in 1979 to help expand the
commercial port of Valletta Grand Harbour. Since then, the EIB
Group's financing in Malta has exceeded €1 billion, aiding
vital sectors such as SME access to finance, urban regeneration,
climate action, telecommunications, and the construction of
affordable housing. The EIB has also supported landmark
infrastructure projects that have transformed the heart of
Valletta, including the Parliament building and the open-air
theatre at the City Gate. As the EU's long-term lending
institution, the EIB remains committed to promoting sustainable
investment and fostering economic resilience in Malta and across
Europe.
Background information
The European Investment Bank (ElB) is the long-term lending
institution of the European Union, owned by its Member States.
Built around eight core priorities, we finance investments that
contribute to EU policy objectives by bolstering climate action and
the environment, digitalisation and technological innovation,
security and defence, cohesion, agriculture and bioeconomy, social
infrastructure, high-impact investments outside the EU, and the
Capital Markets Union. The EIB Group, which also
includes the European Investment Fund (EIF), signed nearly €89
billion in new financing for over 900 high-impact projects in 2024,
boosting Europe's competitiveness and security. All
projects financed by the EIB Group are in line with the Paris
Climate Agreement, as pledged in our Climate Bank Roadmap. Almost
60% of the EIB Group's annual financing supports projects
directly contributing to climate change mitigation, adaptation, and
a healthier environment. Fostering market integration
and mobilising investment, the Group supported a record of over
€100 billion in new investment for Europe's energy
security in 2024 and mobilised €110 billion in growth capital
for startups, scale-ups and European pioneers. Approximately half
of the EIB's financing within the European Union is directed
towards cohesion regions, where per capita income is lower than the
EU average.
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