European State-Backed Lender Explores Defense Industry Cooperation with European Partners
The state-backed lender is exploring the possibility of a defense industry-focused fund, modeled after the European Tech Champion Initiative (ETCI), in collaboration with other European partners. According to the bank’s CEO, Stefan Wintels, in an interview with the Handelsblatt, the lender has been in talks with major European banks from France, Spain, Italy and Poland, as well as the European Investment Bank (EIB), to strengthen cooperation in the sector.
The ETCI is a pan-European fund coordinated by the European Investment Bank, in which Germany has a one-billion-euro stake. Wintels sees scaling the initiative to the defense industry as a logical next step, but declined to provide further details, citing the early stages of the discussions.
The lender had relaxed its guidelines for the defense industry in the spring, allowing it to support companies from the United Kingdom, Norway and Switzerland, in addition to those within the European Union. The subsidiary, KfW Capital, no longer requires the companies it funds to produce goods that are both militarily and civically useful, a previous restriction. The European Investment Bank had recently relaxed its criteria for supporting defense firms as well.