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ESBG shares SME lending story at European Parliament event

ESBG shares SME lending story at European Parliament event

ESBG shared the SME lending story during the SME Intergroup discussion  on 15 September 2015 at the European Parliament. Chaired by SME Intergroup Vice President Kay Swinburne (ECR).​


BRUSSELS, 1 October 2015  – The European Saving Banks Group took part in the SME Intergroup discussion "Financing the Real Economy: Ensuring lending to SMEs" on 15 September 2015 at the European Parliament. Sponsored by UEAPME together with ESBG and chaired by SME Intergroup Vice President Kay Swinburne (ECR)​, statements were delivered by MEP Burkhard Balz​, Rapporteur Stocktaking and challenges of the EU Financial Services Regulation (EPP), by Mario Nava, Director Financial Institutions at the European Commission, by Gerhard Huemer, Director Economic Policy at UEAPME​ and by the ESBG's Caroline Gourisse.


The complementarity between bank lending and capital markets financing, for which ESBG pleaded, was welcomed and the necessary regulatory efforts – mainly in the context of the CRD IV review; the scaling factor being one of the provisions at stake – acknowledged in order to enable in particular savings and retail banks to continue to play their lending role to SMEs. A consensus also arose around the necessity of developing an SME toolbox, such as private placements, specific trading platforms, which, for most of them, will continue to resort to bank lending.

Following the event, the SME Intergroup drew the following conclusions:

  • "The ECON initiative report on the stocktaking and challenges of the financial services legislation reiterates that legislation has to be evaluated, not only ex-ante but also ex-post. However, these impact assessment exercises will never provide the full picture, if they are done on a stand-alone basis only. Capital markets financing alone will not succeed in providing sufficient capital and appropriate financing solutions for SMEs.
There are funding channels that are traditionally used by SMEs, in particular credit financing, with banks being the first point of contact and the main intermediary for SMEs. These traditional channels, their well- and their mal-functioning, have to be included in the picture as well.

  • "Incoherence, inconsistencies and different applications of proportionality in legislation make it much more difficult for small and medium-sized market participants to ensure compliance and to remain competitive vis-à-vis the big ones. This is why the draft report suggests regular consistency, coherence and proportionality checks before and after legislation has been initiated and adopted.

  • A strong diversity in the financial services sectors helps to foster the variety and the amount of funding options of SMEs as well as to maintain a resilient system, which is less likely to collapse during a financial crisis.
We should keep this in mind and not only concentrate on SMEs as the recipient of financing, but also on SMEs as provider of financing.

  • "​We have to understand that SME remain a very important growth market and are significant for the creation of jobs. However, the mortality rate among SMEs is significantly higher than in other fields. This is why it is important to remember that if we lose SMEs, we also lose jobs.
  • "When talking about financing of SMEs, we need to consider several aspects:
    • Capital market union, which may increase access of SMEs to the Capital Market from 2 to 4 percent.
    • Securitisation, which can help banks to finance real economy. This will not alone increase SME lending because securitised loans are too expensive.
    • SME credit information is a problem for access to finance and has to be reviewed by the Commission.
  • "There is an ongoing fight between US and EU financing models. Capital markets in the US are greater than those in the EU. However, bank lending remains crucial for SMEs. This is why we have to find a balance between risks and growth. Smaller local banks are in general better equipped to help SMEs because they trust entrepreneurs. No computer can do that better and decide if an idea is worth financing.
  • "It was concluded that different companies need different forms of financing in different stages of their life. Not all SME are the same. Therefore, legislation should be tailored to the specific needs of SMEs. We have to ensure that high growth medium sized companies get funding here in Europe and not go elsewhere. The US should not capitalise and take-over our SMEs. Member states have to be urged to support their SMEs."

Capital Markets Union; Financial supervision; Leverage ratio; Liquidity ratio; Liquidity standards