The European Investment Bank (EIB) and Bank of Valletta (BOV) have announced a new partnership aimed to strengthen access to finance for medium-sized companies in Malta.

The ElB is the long-term lending institution of the European Union, owned by its Member States. They 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.   

Under the agreement, unveiled on 14th July 2025 by EIB Vice-President Kyriacos Kakouris and BOV 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 BOV’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,” read a joint statement by the banks.

The new facility is expected to help address liquidity gaps and unlock new opportunities for growth.   

The EIB Vice-President 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 BOV we are channelling fresh financing to Maltese businesses that contribute to drive growth, innovation, job creation, and long-term sustainable development in Malta.”

The banks say that eligible companies will benefit from more favourable financing conditions, such as increased funding volumes, and favourable terms and conditions. For BOV, 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.

Mr Farrugia, elaborated further by saying, “this strategic partnership with the EIB 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.”