Financial Partner of the Brussels-based SMEs Innovating through EU Regional Policy 12 th June 2006 Mobilising & Sustaining Private Investment Serge Vilain.

Financial Partner of the Brussels-based SME’s

Innovating through EU Regional Policy 12th June 2006

Mobilising & Sustaining Private Investment

Serge VilainChairman

History and mission

Brussels Regional Investment Company S.R.I.B. - G.I.M.B. Set up in 1984

Size: Capital share: EUR 75 mio Equity: EUR 138 mio

Shareholders: Brussels-Capital Region 76% Private: 24%

Main mission: to support the creation and the growth of brussels-based companies

Brussels-Capital Region : Some data

o Set up in 1980o Surface area: 162km2 - 19

communeso Population:

• 1 mio inhabitants (9,7% pop. Belgium)

• Unemployment: 16% pop.o Economy:

• Service-oriented economy• 17% of the salaried belgian

population in Brussels

Why a Regional Investment Company ?

- to equity for SME’s

- to start-up capital

- to micro-financing

Banks = main sourceof financing

But structural changes + Basel II

to bank financingfor SME’s

MarketFailures

FinanceGap

S.R.I.B. acts

to improve

the access

Limited scope ofthe Venture Capital

Industry

Limited access to start-up financing

Micro-financing

Financial Instruments

Contribution in equity or quasi-Contribution in equity or quasi-equity equity

Start-up financing

Local & social economy

Association with Fonds de Participation

Investments’Cofinancing

Capital expansion & buy outs

Guarantees to obtain bank credit

Partnership with EIB

Facilitating the SME’s bank Facilitating the SME’s bank financing by partnershipsfinancing by partnerships

o Forms of financing: • equity (minority shareholding) - exit

planned after 5 to 7 years• long term loans (without security),• convertible loans, …

o Scope of investments: • Seed & start-up financing (Brustart) • Expansion capital & buy outs (SRIB) • not limited to high growth potential

companies

o Amount of the investment: • from EUR 12K to EUR 3,7 mio

o Goals: • Added value for the Region • Return On Investment

o Advice & supporto Leverage effect: bank financing /

others investors

Some companies in portforlio

Equity & quasi equity

Subordinated loan Subordinated loan

•From EUR 5.000 to From EUR 5.000 to EUR 50.000EUR 50.000

•Rate: 4%Rate: 4%

Micro-creditMicro-credit::

•IndividualsIndividuals

•Personal contribution: Personal contribution: min EUR 620min EUR 620

•Loan from EUR 1.250 to Loan from EUR 1.250 to EUR 12.500EUR 12.500

•Rate: 4%Rate: 4%

Fonds d’amorçageFonds d’amorçage::

• CompaniesCompanies

•Founders contribution : min Founders contribution : min EUR 6.200EUR 6.200

•Loan from EUR 5.000 to EUR Loan from EUR 5.000 to EUR 75.00075.000

•Rate: 4%Rate: 4%

Local EconomyLocal Economy

Support to the development of businessesSupport to the development of businesses established in zone Objectif IIestablished in zone Objectif II

Social EconomySocial Economy

Support to activities Support to activities with a social goal with a social goal

o Set up in 2001 o Cofinanced by structural funds (Objectif II)o Goal: Support to social & local economy

Micro-financing

SRIB Portfolio

Investments in +/- 250 businesses Investments in +/- 250 businesses

% invested amounts 31.12.2005 per activity sector (exc. Brusoc)% invested amounts 31.12.2005 per activity sector (exc. Brusoc)

Investments made in 2005

In EUR Nb investments in 2005InvestedAmounts

Average  Equity Loans Total

7 8 15 6.297.952 419.863

6 6 12 2.305.000 192.083

0 52 52 1.093.280 21.025

Total: 13 66 79 9.696.232 122.737

Financial Instruments

Contribution in equity or quasi-Contribution in equity or quasi-equity equity

Start-up financing

Local & social economy

Association with Fonds de Participation

Investments’Cofinancing

Capital expansion & buy outs

Guarantees to obtain bank credit

Partnership with EIB

Facilitating the SME’s bank Facilitating the SME’s bank financing by partnershipsfinancing by partnerships

62

152

254

382

0

50

100

150

200

250

300

350

400

450

2002 2003 2004 2005

o Goal: to facilitate the SME’s financing by providing the guarantee of the Brussels Region in order to obtain a bank credit

o Cover up to 75% of the bank credit (85% for starters)

o For individuals and SME’s (european definition)

o From july 2003: Management of the Fund by SRIB / Fonds de participation)

o Nearly 400 demands analyzed in 2005

o Activity 2005 = 5 x activity 2002

B2E – Bruxelles PME – KMO Brussel

New financial instrument of the SRIB Group

Set up in March 2006

EUR 28 mios(15 capital – 13 loan)

Loan EUR 50 miosWith guarantee of the Brussels-Capital Region

SME’s

Banks“pari passu”loans

Goal: to facilitate the long term financing of the Brussels-based SME’s Size: EUR 78 mios – financed by SRIB and EIB

B2E – Cofinancing activity

Bank

Brussels-based SMEInvestment > 200K

Loans“pari passu”

From 100K to 750K

Rate = Bank rate – 15 pts

50%Max

50%Min

• Long term loans (min 3 years)• Cofinancing pari passu with banks leverage effect • Amount loans B2E: from EUR 100K to EUR 750 K – max 50%• Interest rate: bankrate – 15 basis pts• Decision process:

•demand of cofinancing introduced by the bank •decision within 2 weeks

B2E – Eligible projects

o Tangibles investments: Tangibles investments: machines, IT, machines, IT,

buildings, ….buildings, ….

o Intangibles investments: Intangibles investments: patents & licences, patents & licences,

R&D, protoypes, R&D, protoypes,

development of a new product or production process, development of a new product or production process, ……

Investments to be made by SME’s SME’s: european definition Activity: all sectors except the non-ethical sectors Investments:

For more information:

S.R.I.B. – G.I.M.B.Rue de Stassartstraat 321050 Bruxelles – Brussel

Phone: 02 /548 22 11www.srib.be – www.gimb.be