Berlin's Investment Bank Sees Decrease in Support Loans for Companies

In Berlin, the economic support landscape is facing challenges as the land-owned Investment Bank (IBB) reports a significant drop in the utilization of funding options by local businesses. The total volume of grants and loans provided by the bank declined from approximately EUR370.5 million in the previous year to nearly EUR287 million, a decrease highlighted by IBB's leadership.

This downturn is attributed primarily to a sluggish economy and a strained budget situation in the city. According to the bank, the monetary aid sourced from the budget for businesses has decreased, as have the loans accessed by companies through the IBB.

The IBB aims to assist a diverse range of entities, including startups, small to medium-sized enterprises, and larger organizations, particularly those innovating in Berlin's designated future sectors, which emphasize sustainability among other themes.

Despite the overall drop in funding, the IBB's leadership expressed optimism regarding the past fiscal year. The bank played a crucial role in facilitating the state's acquisition of Berlin's district heating network, a transaction amounting to around EUR1.5 billion from energy company Vattenfall, with plans to transform the system into a climate-friendly model.

Additionally, the IBB recorded an unprecedented number of commitments for social housing in 2024, approving over 5,000 units for development. However, these housing projects are yet to be constructed, leaving a pressing need for affordable living spaces in the capital.

When including special projects such as the heating network, the overall funding activities of the IBB surged by about two-thirds to approximately EUR3.8 billion in the last year.