ABP, the €373bn Dutch civil service scheme, has committed €25m to a new investment fund for small and medium-sized enterprises (SMEs).
The NPEX Ondernemersfonds, launched by SME exchange NPEX and ABP, targets Dutch companies that aim to raise capital by placing corporate bonds through NPEX.
Merchant bank NIBC, appointed manager of the NPEX Ondernemersfonds, said this sort of financing would boost SMEs’ growth prospects.
“These bonds are to increase the SMEs’ own assets and encourage banks to keep financing companies,” it said.
NIBC is to assesses whether the fund will invest in part of the corporate bonds to be issued.
It added that the investment fund is to participate for a maximum of 25% in each loan.
NIBC further noted that other institutional investors could also participate in financing the new fund.
Regional development companies, as well as players focusing on certain sectors or investing in sustainable projects, can also join the NPEX Ondernemersfonds.
NIBC underlined that a listing would raise the status of SMEs, as it would increase their transparency and professionalism.
The Dutch Investment Institution (NLII) recently launched two proposals for corporate financing for institutional investors, composed of an investment fund for subordinated loans (ALF) and a corporate loans fund (BLF), also aimed at SMEs.
The NLII estimated the financing capacity that would be unlocked over the next three years at €2bn.
A spokesman for APG, ABP’s asset manager, said the new fund was ABP’s contribution to local investment in favour of SMEs, and that the expected annual returns on the corporate loans were 6-9%.
He added that the NPEX Ondernemingsfonds did not consider itself a competitor to the NLII.
“The latter is focusing on larger projects,” he said. “Moreover, there is sufficient demand from SMEs for both funds.”
NIBC was largely owned by ABP and the €178bn healthcare pension fund PFZW until 2005, when it was sold to a consortium of investors and financial institutions headed by JC Flowers & Co.