DEFINITION of 'European Investment Bank - EIB'

A non-profit European Union institution based in Luxembourg that makes loans, makes guarantees, provides technical assistance and provides venture capital for business projects that are expected to further EU policy objectives. While 90% of European Investment Bank (EIB) lending occurs within the EU, 10% occurs in outside markets such as Southeast Europe and Iceland. The bank's shareholders are the 27 EU countries.

BREAKING DOWN 'European Investment Bank - EIB'

EIB loans are funded through borrowing on capital markets. The EIB says it prefers to use its loans to support small and medium-sized businesses, less-developed European countries, environmental improvement and sustainability, energy security, Trans-European networks and knowledge economy projects. Borrowers often use EIB financing in conjunction with third-party financing, and in fact, the EIB commitment can help attract this additional financing.

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