EU approves €250M Portuguese measure to capitalise Banco de Fomento under the RRP

The Commission approves €250 million Portuguese measure, under the Recovery and Resilience plan (RRP), to further capitalise Banco Português de Fomento.

The European Commission announced this Monday the approval of a €250 million Portuguese aid measure, under the country’s Recovery and Resilience Plan (RRP), to “further capitalise” the Banco Português de Fomento (BPF).

“The measure aims to develop the Portuguese economy by facilitating access to finance, particularly for small and medium enterprises (‘SMEs’) affected by the coronavirus pandemic, and thus boosting competitiveness and job creation in the long-term,” the Commission explains in a statement released this Monday. 

“This share capital increase will enable Banco Português de Fomento to further promote the growth of the Portuguese economy in a sustainable way and to support the green and digital transitions. It will also contribute to economic cohesion, productivity and competitiveness. At the same time, it ensures that competition is not unduly distorted,” stresses the Executive Vice-President Margrethe Vestager, in charge of competition policy.

The European Commission explains that this measure will enable BPF to increase financing for businesses, “mostly through the granting of public guarantees in close collaboration with commercial banks active in Portugal”, leveraging investments in the four strategic areas of the InvestEU programme: Sustainable infrastructure; Research, innovation and digitalisation; Social investment and skills and Small and medium-sized enterprises (SMEs).

“The measure therefore also contributes to the policy objectives under the RRF, in particular the green transition, the digital transformation, social and territorial cohesion, smart, sustainable and inclusive growth,” the European Commission adds.