Small and medium-size enterprises (SMEs) depend almost exclusively on the banking system, so the MARF constitutes a complementary and alternative financing channel for them, with which they will be able to access savings from institutional investors.
The Spanish government has been considering for months different methods to facilitate investment into SMEs, due to the shortage of credit within the financial institutions (more focused on their own restructuring process).
“Only in 2012, the concession of credit to businesses experienced a harsh adjustment of 8.5%; and this trend has gone on for four consecutive years,” explains IEB professor Rodrigo García de la Cruz. With this new market, SMEs will be able to issue debt and avoid depending on bank financing.
There will be notes and bonds, depending on the financing needs. The main purpose of the MARF is to hold between 20 and 30 emissions of €20 to €25 million each year. It is not ruled out, however, emissions of €10 million or above €50 million.
The new market would be able to mobilise around €1,000 million during its first year, with a return of 6% to 10%, according to data provided by Axesor –a company specialised in information and credit risk management. In addition, the MARF is configured as a Multilateral Trading Facility (MTF) intended to institutional investors, and it is administered by AIAF, BME’s corporate bond market.
The MARF is now fully operational and in the process of registering new members and advisors. According to BME, several companies have already showed interest in this new market. Furthermore, IEB and Axesor claim that around 100 Spanish companies would comply now with the ideal profile to immediately enter this market.
In Spain, non-bank financing of SMEs represents barely 22% versus 55% of France, 45% of Germany or 70% of the US. This sort of market is already operating in other European countries, such as Norway (Oslo AMB), which launched it in 2005 and has provided around €4,223 million to the real sector since its creation. Germany (Mid-cap Bond Market), France (Alternext) and Italy (Extra Mot Pro) have their own markets as well.