CommuniqEU

Corporate DispatchPro

KEITH ZAHRA

SME Financing

The EIF and the European Commission have launched new COVID-19 support measures under the EaSI Guarantee Instrument (EaSI) to enhance access to finance for micro-borrowers, micro- and social enterprises.

The European Commission explained how the new measures will support micro- and social enterprises as well as individual microborrowers hit by the socio-economic consequences of the coronavirus pandemic. The objective of the new COVID-19 measures is to further incentivise financial intermediaries to lend money to small businesses, mitigating the sudden increase in perceived risk triggered by the coronavirus pandemic, and alleviating working capital and liquidity constraints of final beneficiaries targeted by the EaSI programme. Key features of these new measures include higher risk coverage, broadening of certain parameters, such as an increase of the maximum exposure for micro and social enterprises, and more flexible terms.

The new features will be accessible to financial intermediaries, that can potentially serve thousands of companies benefitting from guarantees undertheEaSIGuaranteeInstrument.Todate,theguaranteesprovided by EIF to financial intermediaries operating in the micro and social finance space have unlocked around EUR 1.4bn of debt financing, allowing more than 85,000 micro and social enterprises across Europe to access financing.

Corporate DispatchPro

KEITH ZAHRA

Health

European regulators could be in a position to approve the first vaccine against Covid-19 this year, after a flurry of trials by pharma companies leading the race showed promising results.

The portal quotes Marco Cavaleri, head of vaccines at the European Medicines Agency: “We are preparing ourselves for that possibility so that we as regulators will be ready. It will be a matter of seeing whether this data could be sufficient for allowing any kind of approval by the end of 2020.”

The Agency will be working with these companies on trial data, manufacturing and clinical decisions. The approach should allow any successful vaccine to be officially approved within a matter of days once submitted, Cavaleri noted.

Optimism over prospects for Covid-19 vaccines has grown after both the University of Oxford and AstraZeneca Plc published promising results from earlyhuman tests.VaccinepartnersPfizerInc.and BioNTech SE, as well as China-based CanSino Biologics Inc., also announced early positive data from their vaccine trials. AstraZeneca Chief Executive Officer Pascal Soriot said the company hopes to be able to start delivering a vaccine by end 2020.

Corporate DispatchPro

KEITH ZAHRA

Brexit / Financial Services

Regulators in Britain and the European Union reach an agreement to avoid disruption in cross-border asset management even in case of a No-deal Brexit. Britain left the EU in January, but full access to the European market has continued under a transition agreement that ends in December.

Negotiations of a new UK-EU trade pact have stumbled, and Britain’s requests for direct financial market access are being looked into separately by Brussels.

The European Securities and Markets Authority (ESMA) and Britain’s Financial Conduct Authority (FCA) said that memoranda of understanding (MOUs) drawn up in February 2019 in case Britain left the bloc without a transition deal “remain appropriate”.

They will now come into effect after the end of December, when the transition period expires, ESMA and the FCA said in separate statements.

Corporate DispatchPro

KEITH ZAHRA

Banking

The European Central Bank has told banks not to pay any dividend payments until at least January and urged them to be “extremely moderate” when setting staff bonuses during the coronavirus pandemic.

The recommendations from the central bank seek to help banks absorb losses and support lending throughout the crisis, which has left practically all eurozone countries in negative territory.

Andrea Enria, chair of the ECB’s supervisory board, said: “The buildup of strong capital and liquidity buffers since the last financial crisis has enabled banks during this crisis to continue lending to households and businesses, and thereby to help stabilise the real economy. Therefore, it is all the more important to encourage banks to use their capital and liquidity buffers now to continue focusing on this overarching task: lending, whilst of course maintaining sound underwriting standards.”