The European Investment Fund (EIF) and Ringkjøbing Landbobank have signed a guarantee agreement to facilitate up to DKr320m ($46.81m) in new green investments for Danish small and medium-sized enterprises (SMEs) and small mid-caps.

Backed by the European Commission’s InvestEU programme, the initiative is designed to support climate change mitigation and sustainability projects, emphasising renewable energy initiatives such as wind turbines and solar panels.

The arrangement is intended to enhance the availability of financing for small companies that are investing in their green transition, aiming to boost their productivity and competitiveness.

Ringkjøbing Landbobank CEO John Fisker said: “We are pleased with this new partnership with EIF. We have a common goal in Europe on the green transition, and this guarantee agreement further strengthens our bank’s market position and supports our customers’ competitiveness by financing new investments.”

Ringkjøbing Landbobank will make the final decisions on loans distributed under this facility.

EIF chief executive Marjut Falkstedt said: “The EIF is making serious work of supporting the green transition through its financing for SMEs and small mid-caps.

“We are very active in Denmark this year, and this collaboration is testament not only to the EIB Group’s long-standing relationship with Ringkjøbing Landbobank but also to our intention to be a point of reference for Danish financial intermediaries when it comes to climate finance.”

Earlier in the year, Ringkjøbing secured a loan agreement worth DKr745m with the European Investment Bank, of which the EIF is a part.

This loan is to be passed on to eligible Danish SMEs and mid-caps to improve their access to finance and aid their green transition efforts.