EIB and BNG Bank Renew Partnership, Offering €600 Million in Favorable Financing for Dutch Public Sector

EIB and BNG Bank Renew Partnership, Offering €600 Million in Favorable Financing for Dutch Public Sector

(IN BRIEF) The European Investment Bank (EIB) and BNG Bank have renewed their collaboration in the Netherlands with a new €300 million lending agreement. The loan aims to provide low-cost financing to Dutch public sector entities, particularly healthcare and educational institutions. Under the agreement, the EIB will provide €300 million to BNG Bank, which will then on-lend the funds on favorable terms. The collaboration has the potential to generate a total of €600 million in loans, with the EIB’s support resulting in lower interest rates for BNG Bank’s clients. This renewed partnership builds on their previous successful collaboration, which led to €500 million in investments in the public sector, particularly in social housing cooperations and the Dutch real estate construction sector. The agreement reflects the commitment of both institutions to stimulate public investments and support sustainable economic development in the Netherlands.

(PRESS RELEASE) LUXEMBOURG, 8-Jun-2023 — /EuropaWire/ — The European Investment Bank (EIB), the lending arm of the European Union, and BNG Bank have renewed their collaboration with a new €300 million lending agreement aimed at facilitating low-cost financing for Dutch public sector entities. This agreement follows a memorandum of understanding between the two financial institutions, which outlines their commitment to exchange knowledge and expertise in order to stimulate public investments in the Netherlands. Under the terms of the agreement, the EIB will provide €300 million to BNG Bank, which will then on-lend the funds on favorable terms, primarily to healthcare and educational institutions.

With the EIB typically financing up to 50% of a project’s total cost, this collaboration has the potential to generate a total of €600 million in loans together with BNG Bank. The support from the EIB will also result in lower interest rates for BNG Bank’s clients compared to regular loans.

“As market leader in public sector finance, BNG Bank aims to have an impact on society by helping its clients solve their key transition challenges by providing financing at the lowest possible rates. This EIB loan enables BNG Bank to offer competitive rates to clients in the healthcare and education sectors, in particular. This lending agreement thus fits perfectly with our strategy,” said Thomas Eterman, CCO of BNG Bank.

EIB Vice-President Kris Peeters added: “BNG Bank is very well-placed to help local authorities with competitive financing. The EIB uses its entire arsenal of financial instruments to provide financial support to as many parties as possible, and we’re very glad that we can count on the partnership with BNG Bank to, for example, support the middle-sized segment in the Dutch public sector.”

This latest agreement builds upon the successful collaboration between the EIB and BNG Bank, which began in 2016 with a €250 million loan. That initial loan resulted in a total of €500 million invested in the public sector, with a focus on supporting social housing cooperations and the Dutch real estate construction sector.

By renewing their partnership, the EIB and BNG Bank are once again demonstrating their commitment to fostering sustainable economic development and providing accessible financing to vital public sector projects in the Netherlands.

Background information:

The European Investment Bank (EIB) is the European Union’s long-term lending institution, owned by the EU Member States. The EIB finances sound projects that contribute to the European Union’s policy goals. The Netherlands owns a 5.2% share of the European Investment Bank.

BNG Bank is a committed partner for a more sustainable Netherlands. The bank supports government policy by providing cheap financing based on its AAA rating to municipalities, housing associations and healthcare institutions, among others. With a balance sheet of over €110 billion, BNG Bank is the fourth-biggest bank in the Netherlands.

News release in 2016:

EIB and BNG Bank help public sector with low-cost investments

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SOURCE: European Investment Bank