Financing SMEs and Entrepreneurs 2024

4. Austria

Key facts on SME financing

As in many EU countries, SMEs contribute substantially to Austria’s economy. In 2021, 99.8% of all firms were SMEs, employing approximately 66% of the labour force. The capital structure of SMEs in Austria is traditionally biased towards debt financing, and limitations on access to risk-finance are still apparent. Bank lending is therefore an important factor affecting the availability of external financing for SMEs. However, access to finance is generally not a major concern for Austrian SMEs.

In 2022, the outstanding business loans amounted to EUR 201.4 billion, which is an increase of around 9% compared to 2021. These are the holdings of non-financial corporations in Austria, according to the monetary statistics. In the Granular Credit Data Collection (GKE), conducted by the Austrian Central Bank (OeNB), Austrian credit institutions reported a total utilization to businesses of EUR 199.5 billion as of 31 December 2022. Of this, EUR 92.3 billion was awarded to the SME segment in Austria: EUR 28.8 billion to micro-enterprises, EUR 30.2 billion to small companies and EUR 33.3 billion to medium-sized companies.

In the case of non-financial corporations, EUR 4.28 billion were flagged as non-performing. This resulted in a nonperforming loans (NPL) ratio of 2.14%, which is almost the same as the year before (2.15%). EUR 3.05 billion were reported as non-performing in the SME sub-segment. This resulted in an NPL ratio for SMEs of 3.31%. In 2021, the NPL ratio for SMEs was slightly lower registering 3.09%.

The share of SMEs’ new business lending was smaller than in previous years, with almost 12%. Interest rates have increased quite significantly, with an average interest rate of 2.08% in 2022 for loans up to EUR 1 million, compared to 1.63% in 2021. In 2022, interest rates for larger firms with loans over EUR 1 million were lower compared to SME interest rates at 1.82% but have also increased compared to 2021 when the interest rates for large firms were 1.34%.

When it comes to non-bank finance, venture capital declined by 65% compared to 2021. On the other hand, leasing and hire purchases as well as factoring and invoicing both showed a steady upward trend since 2014. Leasing and hire purchases increased almost 9%, factoring and invoicing by almost 18%.

Payment delays increased slightly in the B2B sphere, from 12 days in 2021 to 14 days in 2022. However, in the B2C sphere there was an improvement, with a 6-day payment gap in 2022, compared to 10 days in 2021. Bankruptcies have reached pre-crisis levels, with around 10 bankruptcies per 1 000 firms. Overall, there were 4 913 bankruptcies in 2022, an increase of almost 60% compared to the previous two years, which were exceptional and cannot be seen as representative. The 2022 figure is closer to the figures registered prior to the pandemic. Of the 4 913 companies that went bankrupt, 4 903 were SMEs, which also corresponds to the share of SMEs in the national economy.

Table 4.1. Scoreboard for Austria

Indicator		Unit	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022
		Debt
Outstanding business loans, total		EUR billion	135.5	138.8	140.4	140.3	136.6	137.2	135.6	143.8	153.0	162.9	169.8	184.5	20.,4
New business loans, total (flows)		EUR million	74 896	73 041	80 867	73 460	73 126	61 711	55 543	64 418	64 438	71266	60096	61035	62139
New business loans, SMEs (flows)		EUR million	9 414	9 476	9 347	8 884	8 237	8 116	7 499	8 304	8 182	8 639	9214	8 282	7283
Share of new SME loans		% of total business loans	12.57	12.97	11.56	12.09	11.26	13.15	13.50	12.89	12.70	12.12	15.33	13.57	11.72
short-term loans, SMEs (flow)		EUR million	5 139	4 944	4 901	4 536	4 016	3 345	3 010	2 539	1 998	1 969	1640	1691	1464
long-term loans, SMEs (flow)		EUR million	4 275	4 532	4 446	4 348	4 221	4 771	4 489	5 765	6 184	6 670	7574	6591	5819
Share of short-term SME lending		in %	54.59	52.17	52.43	51.06	48.76	41.21	40.14	30.58	24.42	22.79	17.80	20.42	20.10
Government loan guarantees, SMEs		EUR million	173	143	158	167	172	204	192	279	301	366	4898*	2115*	344
Government guaranteed loans, SMEs		EUR million	226	185	207	211	225	258	282	414	395	568	5508*	2492*	514
Government direct loans, SMEs		EUR million	607	633	539	594	490	543	454	744	690	749	793	874	700
Interest rate, SME, loans up to EUR 1m		in %	2.43	2.92	2.46	2.28	2.27	2.02	1.92	1.80	1.82	1.80	1.59	1.63	2.08
Interest rate, large firms, loans over EUR 1m		in %	1.96	2.55	1.98	1.77	1.74	1.61	1.54	1.45	1.38	1.32	1.36	1.34	1.82
Interest rate spread		in %	0.47	0.37	0.48	0.51	0.53	0.41	0.38	0.35	0.44	0.48	0.23	0.29	0.26
Non-performing loans, total		in %	..	2.71	2.81	2.87	3.74	3.39	2.67	2.37	1.88	1.77	1.58	1.46	1.39
		Non-bank Finance
Venture and growth capital (seed, start-up, later stage)		EUR million	43	97	44	59	60	112	57	108	86	81	105	701	182
Venture and growth capital (growth capital)		EUR million	34	118	29	26	45	85	29	179	49	88	146	156	117
Venture and growth capital (total)		EUR million	77	215	73	85	105	197	85	287	135	169	251	857	299
Venture and growth capital (growth rate)		In %	-31.53	177.61	-66.31	17.76	22.56	87.97	-56.63	235.47	-52.96	24.98	49.11	240.86	-65.12
		Other
Payment delays, B2B		Days	11	12	11	12	13	4	4	2	1	1	14	12	14
Payment delays, B2C		Days	11	11	9	9	9	1	4	1	1	5	9	10	6
Bankruptcies, total		Number	6 657	6 194	6 266	5 626	5 600	5 422	5 534	5 318	5 224	5235	3106	3076	4913
Bankruptcies, per 1 000 firms		Number	18	17	17	15	15	11	12	11	11	11	7	6	10

* Note: this temporary increase is related to COVID-19 crisis response measures

Source: See Table 4.5.

Macroeconomic and financing conditions

In 2022, Austrian GDP grew by 4.9% in real terms, mainly due to the strong growth in the first half of the year, which was still characterized by the corona-related catching-up processes. The labour market performed well in 2022, with employment increasing by 3% and the unemployment rate falling to 4.8%.  The economy clouded over in the second half of the year due to the war in Ukraine and high inflation. The slowdown in economic momentum from the second half of 2022 onwards continues to weaken the economy in the first quarter of 2023, with a growth of 1.9% year-on-year. In their forecasts from June 2023, the Austrian Institute of Economic Research (WIFO) and the Institute for Advanced Studies (IHS) expect further stagnation until mid-2023 and then initially restrained growth in the Austrian economy. GDP growth of 0.3% (WIFO) or 0.5% (IHS) is expected for 2023 as a whole, and both expect 1.4% for 2024. Both institutes expect weak investment dynamics for 2023, with the IHS (–1.0%) being more pessimistic than the WIFO (-0.6%). For 2024, WIFO and IHS forecast growth in gross fixed capital formation of 0.8% (WIFO) and 0.5% (HIS). According to the latest OeNB forecast from June 2023, HICP inflation will remain high at 7.4% in 2023, after 8.6% in 2022. HICP inflation is expected to fall to 4.1% in 2024.

Concerning financing conditions uncertainty, rising prices and the slowdown in the global economy are having a dampening effect on demand for long-term loans as investments are scaled back or postponed. On the supply side, the war and its aftermath have prompted banks to conduct more stringent risk analyses adapted to the situation and to make lending decisions more stringent.

SMEs in the national economy

Small and medium-sized companies continue to be the main pillar of the Austrian economy. According to the most recent structural business data from Statistics Austria1 there were 588,224 small and medium-sized enterprises (SMEs) in Austria in 2021, which corresponds to 99.8 percent of all companies in the market-oriented economy. SMEs employed more than 2 million workers and trained around 53,000 apprentices (Bundesministerium, 2023), which equals to 66% of employees and 62% of apprentices in the market-oriented economy. In 2021, turnover of SMEs amounted to around EUR 510 billion, which is 57% of the total turnover of the market-oriented economy. The gross value added to EUR 144 billion, which is 57% of the value added.

After slumps in 2020 due to the corona pandemic, the SME sector grew again in 2021 and 2022. According to the Austrian Economic Chamber the number of start-ups in Austria remained high in 2022. With 34,685 start-ups, there was a slight decrease of 2.3% compared to the previous year, but 2021 was an "outlier" due to the corona-related lag effects. The provisional data from 2022 (excluding the profession of self-employed caregivers), shows the second highest number of start-ups since 1993 (after 2021). Women accounted for 45.1% of start-ups, which was the second highest proportion (after 2021) since 1993 as well.

The report SME in focus, the main report of the Federal Ministry of Labour and Economy on the situation and development of small and medium-sized companies in the Austrian economy, highlighted the following, as areas of strength of Austrian SMEs:

• High degree of internationalization: 15% of Austrian SMEs export goods to developing countries, compared to 10% of SMEs on average in the EU. Around 16% sell goods online to other EU countries, versus 9% EU-wide.

• The 2022 KOF Globalisation Index also supports this finding, where Austria ranks seventh or even fifth when considering the Globalisation “de facto” Index.

• Sustainability: 53% of Austrian SMEs have a carbon footprint reduction strategy, compared to 24% in the European Union. Around 44% offer ecological products or services, versus 32% EU-wide.

• Degree of innovation: Around six out of ten SMEs in Austria are active in innovation compared to five out of ten SMEs on average in the EU.

• Access to finance: 68% of domestic SMEs assess access to private and public finance as (very) good compared to 50% of SMEs in the EU on average. Credit financing in particular is rated positively in Austria with77% of domestic SMEs confident of obtaining bank financing if required, compared to 67% of SMEs in the EU-27.

The report identified the following areas as some of the main challenges for SMEs in Austria:

• Digitalization: the share of e-commerce sales in Austrian SMEs is slightly below the EU average (10% versus 11%). Advanced technologies such as big data analyses or artificial intelligence (AI) technologies are used less frequently in Austrian SMEs.

• Energy and commodity prices, supply chain issues: More than eight out of ten companies are burdened by the current energy prices as well as the prices of raw materials and inputs. For around half of the companies, challenges arise from delivery bottlenecks.

• Venture capital funding: At 0.22% of GDP, the percentage of private equity is well below the European average of 0.75% of GDP.

The European Commission also states in their 2023 country report on Austria that “strengthening the domestic venture capital market is important for Austria’s start-up dynamism and has the potential to increase the number of start-ups and high-growth enterprises”.

The lack of equity financing is also illustrated by the EIF SME Access to Finance Index (ESAF), a composite indicator that summarises the state of SME external financing markets for each of the EU-27 countries. Concerning loans Austria ranks 4^th, when looking at credit and leasing Austria even ranks 2^nd, but in the equity category Austria ranks 16^th. This at least is an improvement compared to 2020, when Austria ranked 19^th.

The economic situation of micro, small and medium-sized enterprises in Austria is examined in the “SME in focus” report by looking at balance sheet data from 2020/21 based on the annual financial statements after the first corona year. The key figures for the year 2020/21 do not show any economic slumps, but rather a stable overall financial situation for SMEs. In order to maintain stability, in addition to the cost reductions introduced by the companies, the corona relief measures have made a significant contribution. Ensuring an overall healthy financial situation for companies is a government priority against the background of the current challenges caused by the large-scale aggression of Russia against -Ukraine, in particular rising energy costs, shortages of raw materials and restraint in consumption and investments. In the 2020/21 financial year, Austria's SMEs achieved an average return on sales of 5.9% (indicative value 2021/22: 6.5%). In 2019/20 it was 5%. The equity ratio averaged 35% (indicative value 2021/22: 37%). In 2019/20 it was slightly lower with 34.1%.

Austria's share of SMEs is similar to the average of the EU-27 according to the SME in focus report, the proportion of employees in SMEs is also similar for both Austria and SMEs in the EU. In terms of employees, however, Austrian SMEs are slightly larger than those within the EU. The average company size for SMEs is around five employees per company compared to 3.5 employees for SMEs in the EU-27.

Table 4.2. Distribution of firms in Austria, 2021

Firm size	Number of firms	%	Annual average number of employees	%
All firms	589 615	100	3 590 035	100
SME (0-249)	588 224	99.8	2 374 412	66.1
Micro (0-9)	543 530	92.2	746 050	29.2
Small (10-19)	25 468	6.8	338 495	9.4
Small (20-49)	13 284	2.6	393 699	11.0
Medium (50-249)	5 942	1.0	593 900	16.5
Large (250+)	1 391	0.2	1 215 623	33.9

Source: Statistics Austria (2023)2

SME lending

The 2022 “SME in focus” report shows that the average bank debt falls as the size class increases3. While micro-enterprises finance around 36% of their assets through bank loans on average, small companies are somewhat less dependent on banks at around 29% on average. Medium-sized companies have an average bank debt of 19%. At an average of 9%, the bank debt of large companies is well below the SME average of 24%.

SMEs have less collateral compared to large companies. As a result, their access to finance is often associated with challenges. SMEs cover the majority of their financing needs through banks, so it is particularly important to ensure access to credit, but also to provide alternative sources of financing. At the sector level, companies in the information and communication sector have the lowest bank debt (ratio) with around 11% on average. In contrast, in accommodation and gastronomy, bank debt is above average at 53%4. However, Austrian firms are usually not worried about their access to bank financing, even though the results of the latest SAFE survey suggest, that the availability of bank loans deteriorated recently. However, confidence in the ability to receive the desired loan amounts is still very high among SMEs in Austria. This is turn again confirms SMEs reliance on bank funding: according to the SAFE survey, the number of Austrian SMEs applying for bank loans was above the EU average. Only 4% of SMEs did not apply because of a possible rejection, which is the lowest rate in the EU. However, as the European Commission points out in their 2023 country report on Austria, “limitations on access to risk capital, particularly on venture capital finance, are affecting innovative SMEs and start-ups” (page 55).

Since SMEs play such a vital role for the Austrian economy and are so prevalent, the data of the Austrian Central Bank (OeNB) on corporate lending provides an interesting picture for the current state of SME lending as well. A recent study by the OeNB from November 2022 shows that annual corporate loan growth hit a record high in August 2022 amid high inflation. Lending by Austrian banks to domestic corporations recorded an annual growth rate of 12.1% in August 2022, the highest increase (in nominal terms) since the ECB monetary statistics began to be recorded (1998) according to the OeNB. The outstanding loan portfolio was EUR 198.4 billion in August. Before the outbreak of the COVID-19 pandemic, it was EUR 163.9 billion (February 2020), with consistently positive annual growth rates since then. While credit growth was still 4.1% in August 2021, it rose sharply and continuously, especially at the end of 2021 and since June 2022. However, the nominal development in 2022 was particularly driven by shorter-term loans, which have accounted for an increasing share of loan growth in recent months. This was due in part to an intensification of short-term inventory and working capital financing requirements as a result of the Ukraine war. The increase in loans with an original term of up to one year has accelerated sharply in recent months and, with an annual growth rate of 25.6%, showed the highest value since records began in August 2022.

However, the strong expansion of corporate loans must also be viewed against the background of sharply rising production costs. In 2022, these grew much faster than the credit volume, in particular due to the rise in energy prices. In an international comparison, domestic growth in corporate loans in August 2022 was 12.1%, well above the euro area average of 8.7%. As in Austria, the average annual growth in the euro area was strongly driven by short-term loans (up to one year), which showed an annual growth rate of 25.6% (18.7% in the euro area).

Lending growth in the corporate sector also went hand in hand with rising interest rates. Interest rates for new corporate loans (including renegotiations) rose to 1.65% in August 2022, the highest since February 2016 (1.68%). This has also led to a significant rise in interest rates on outstanding corporate loans, which rose to 1.58% in August. In an international comparison, however, domestic corporate lending rates were still slightly below the euro area average (which also experienced comparable increases). In August, Austria showed an average interest rate of 1.58% for the outstanding loan portfolio compared to 1.76% in the Euro area, while the conditions for new business were 1.65% in Austria and 1.8% in the Euro area.

As shown by the OeNB for the first quarter of 2023, for the first time since the fourth quarter of 2021, the demand for credit to finance warehousing and working capital did not increase significantly. This is likely related to the phasing out of supply chain bottlenecks according to the OeNB. Banks have tightened their supply policies for corporate loans across the board since the second quarter of 2022, mainly due to a less favourable risk assessment.

Figure 4.1. Annual growth rates of outstanding business loans to non-financial corporations in Austria and the Euro area

Source: OeNB

Statlink

In this country profile, SME loans are approximated by data of new business loans to non-financial corporations up to EUR 1 million provided by the Austrian National Bank. The loan data exclude loans granted to sole proprietors, revolving loans and overdrafts, which an important sources of bank lending to SMEs. Considering these conditions, new loans to SMEs (i.e. up to EUR 1 million) fell in 2022 by around 12% compared to the year before. On the other side, new loans to non-financial corporations of more than EUR 1 million rose by around 4% in 2022, leading to an overall rise of new loans to non-financial corporations by around 2% compared to the year before. Overall, the share of new SME loans (i.e. up to EUR 1 million) therefore decreased by almost two percentage-points to 11.7%.

Figure 4.2. . Distribution of new loans, 2009-22

Source: OeNB

Statlink

The developments in the lending business must always be assessed against the general economic background and continue to take place in the context of or as a result of global economic and political upheavals (war in Ukraine, supply chain problems, price shocks, global economic slowdown). The mood and prospects have improved recently, however, and the supply chains are stabilizing again. Still, the tightening of monetary policy (especially the increase in key interest rates) that the ECB began in mid-2022 to combat inflation is slowing growth prospects. Overall, only a moderate upswing is therefore expected.

Credit conditions

According to the most recent SAFE survey, SMEs report a declining willingness of banks to lend and see deteriorating availability of credit lines, bank or credit cards overdrafts, or bank loans or trade credit. The availability of bank loans yields the worst results, with the largest net deteriorations in the availability of bank loans reported in Lithuania (19%), Luxembourg (17%) and Austria (16%). The SAFE survey also shows that two thirds of SMEs with bank financing have experienced an increase in interest rates. Six in ten SMEs are confident to talk with banks about financing and receive the expected amount. However, confidence varies considerably between Member States, ranging from 78% in Austria to 45% in Hungary and Latvia.

The findings of the SAFE survey are in line with the data provided by the Austrian Central Bank (OeNB) from June 2023. According to the OeNB, interest rates in new corporate lending began to rise comparatively late – only from the third quarter of 2022 – but subsequently rose sharply. In January 2023, the interest rate for new corporate loans in Austria was 3.43%, compared to 1.44% in January 2022. As shown by the OeNB similar increases were also observed in the euro area, which meant that Austria retained its interest rate advantage for new loans in an international comparison (Austria: 3.43%; euro area: 3.60%; Germany: 3.58%). The higher interest rates in Germany and in the Euro Area are also due to the fact that a higher proportion of short-term corporate financing5 is transacted in Austria. In addition, for longer-term loans (original term longer than one year), it is also evident that the proportion of variable interest rates in Austria is noticeably higher than in the euro area comparison. When looking at the average share of variable loans in 2022 Austria stands at 76%, which is a significantly higher value than in the euro area (62%), Germany (60%) or France (44%). Although Austrian companies retained their interest rate advantage over the euro area in new one-off loan business, interest on all outstanding corporate loans of EUR 201.8 billion (January 2023) rose more sharply than in the euro area. In January 2023, companies in Austria had to pay more interest on their outstanding loan volume than the euro area average (2.8%) for the first time, with an average interest rate of 3.14%. Due to the significantly increased interest rates on the outstanding portfolio, the monthly interest payments to be made by Austrian companies doubled within one year from around EUR 227 million (in January 2022) to EUR 528 million in January 2023. The higher interest rate increases in an international comparison are due to the fact that in Austria, a higher proportion of outstanding corporate loans are subject to variable interest rates.

Figure 4.3. . Development of lending rates, 2010-23

Source: OeNB

Statlink

When examining the banks point of view there is also evidence that corporate lending standards have tightened slightly in the first quarter of 2023, after having repeatedly tightened significantly in the previous three quarters. These are the results of the Austria portion of the bank lending survey from April 2023. For the second quarter of 2023, the banks participating in the survey expect largely unchanged guidelines. The banks surveyed named a less favourable risk assessment as the main reason for the tightening in the last four quarters. Banks’ refinancing conditions and banks’ risk tolerance were also named as factors with a slightly tightening influence on credit standards.

For the first quarter of 2023, domestic banks reported that corporate loan demand had fallen. In detail, however, developments differ. Since the fourth quarter of 2022, demand from small and medium-sized enterprises and demand for long-term loans has fallen. The demand for short-term loans has grown in the last two quarters, while the demand for loans from large companies has stagnated. Already from the fourth quarter of 2021 to the third quarter of 2022, the demand for short-term loans and that from large companies developed more expansively than that for long-term loans and that from SMEs. In the outlook for the second quarter of 2023, the banks participating in the survey expect hardly any changes in credit demand. From the fourth quarter of 2021 to the fourth quarter of 2022, financing needs for storage and working capital were the dominant reason behind the increase in demand for (short-term) credit. Long-term financing needs for fixed investments have developed much more slowly. Demand for investment financing has been declining since the third quarter of 2022. In the fourth quarter of 2022 and the first quarter of 2023, demand for corporate loans was also dampened by higher interest rates and the increased use of alternative sources of financing. In the second, but especially in the third and fourth quarters of 2022, banks often rejected loan applications from SMEs. In the first quarter of 2023, the rejection rate in the business with SMEs remained roughly at the level of the previous quarter.

Alternative sources of SME financing

After all records for start-up financing were broken worldwide in 2021, rising interest rates, economic uncertainties, inflation and an impending recession have severely clouded the market environment. The combination of these factors and the economic situation are causing venture capital financiers worldwide to be more cautious resulting in a significant slowdown in the financing market for start-ups and scale-ups. Austria's start-ups and scale-ups looking for venture capital financing are also currently preparing for longer phases until the next round of financing, lower valuations and volumes, and less ambitious growth targets.

According to figures from the EY Investment Barometer Austria for 2022, this deterioration in the financing market for Austrian start-ups happened in the second half of the year. After a very strong first half of the year with a total of EUR 881 million in investments - a new record - the dynamic slowed down significantly in the second half of 2022: only EUR 125 million were invested - that is 83% less than in the same period of the previous year.

When looking at the country of origin of investors, EY concludes that Austrian investors mainly provide aid to “jump start”, foreign donors usually finance growth. In the case of early-stage investment rounds, domestic investor groups are in the lead: for the first time, investors based in Austria are dominating not only in the pre-seed area (2022: 75%, 2021: 78%), but also in the seed phase (2022: 65%, 2021: 45%). As the number of rounds increases, the proportion of domestic investors continues to fall, and no domestic investor was involved in either of the two major financing rounds of more than EUR 100 million.

Looking at how the options for raising external capital have developed over the course of the year, 42% of the start-ups state that in 2022 the possibilities for raising external equity (business angels and venture capital) have deteriorated (27%) or have deteriorated significantly (15%) (Austrian Startup Monitor 2022, page 10). 36% assess the environment for venture capital financing as stable and 23% see an improvement in financing opportunities from private investors. The assessments of debt financing are even more pessimistic. Here 47% see a deterioration, 41% an unchanged environment and only 12% an improvement of the financing possibilities. When looking at the sources of financing used, a particularly strong increase can be observed in the support of incubators, accelerators and company builders. Overall, according to the Austrian Startup Monitor just over a third Austrian start-up have raised venture capital (35%), hence was financed by either business angels and/or VC funds (page 10).

Austria still has a long way to go when it comes to all forms of alternative sources of SME financing. According to data for 2022 from the annual activity statistics created by Invest Europe, Austria is well below the EU in all of the observed categories. When looking at the industry statistics (location of the private equity firm) of all private equity with investments as % of GDP Austria is at 0.041% compared to the European total of 0.623%. The industry statistics of Venture Capital shows investments of 0.025% of GDP, compared to a European total of 0.09%. The industry statistics of growth investments show a particularly weak 0.002% of GDP for Austria, compared to 0.138% European total. The market statistics (location of the portfolio country) of all private equity shows investments of 0.14% of GDP for Austria, compared to a European total of 0.638%. Within the Venture capital market statistics Austria stands at 0.041% of GDP, compared to a European total of 0.089%. The market statistics of growth investments as % of GDP again show a weak 0.026% for Austria, compared to a European total of 0.143%. The comparison to the European total is actually a little misleading, because the very low numbers among countries in Central and Eastern Europe drives the average. Austria finds itself among those countries rather than other comparable economies such as the Netherlands, Denmark or Belgium, who are all well above Austria and very often also above the European average.

Table 4.3. Venture and growth capital investments in Austria, 2011-22

By investment stage, in EUR million

Stage	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022
Seed	10.4	9.2	11.5	11.0	10.4	4.1	13.8	2.7	5.0	1.2	14.2	3.6
Start-up	35.2	24.7	21.1	17.3	32.5	33.3	63.8	34.3	38.1	42.4	48.8	85.6
Later stage venture	51.7	9.8	26.8	31.3	69.5	19.5	30.3	49.4	37.7	61.4	637.9	93.0
Total venture	97.3	43.7	59.4	59.6	112.4	56.9	107.9	86.4	80.8	105.0	700.9	182.2
Growth capital	118.4	29.0	26.2	45.2	84.7	28.6	179.0	48.5	87.8	146.4	155.9	116.7
Total venture and growth capital	215.7	72.7	85.6	104.8	197.1	85.5	286.9	134.9	168.6	251.4	856.8	298.9
Other (rescue / turnaround, replacement capital, buyout)	96.6	358.4	466.1	216.7	956.5	35.8	132.3	898.9	171.7	20.0	18.7	327.5

Source: Invest Europe (2023)

Looking at another indicator related to non-bank finance, the picture looks a little different. The factoring market in Austria shows great dynamism. The Austrian factoring association (Österreichischer Factoring Verband) shows that the Austrian factoring market amounts to EUR 35.9 billion in 2022 (volume of purchased receivables). The overall market recorded dynamic growth of 18% in 2022, the increase in the Austrian factoring market adds up to 49% in the last five years. Demand for factoring is therefore growing disproportionately, factoring is even growing at an above-average rate among all forms of financing in Austria according to the Austrian factoring association. The main reasons for the high demand are a higher level of awareness, company growth and the usage of factoring as a form of growth financing as well as the overall goal of having a sensible financing mix with factoring as a supplement to classic types of financing. The Austrian factoring association expects significant growth momentum also for the future. However, in an international comparison provided by the EU federation Factoring & Commercial Finance, the market penetration in Austria is still comparably low. The factoring rate in Austria was 8% of GDP in 2022. The EU average in 2022 was a market penetration of 12.6%, with comparable economies show higher rates, such as Belgium with 22.5%, the Netherlands with 17.4% and Finland with 10.5%.

Other indicators

The two main indicators discussed in this chapter are payment delays and bankruptcies. For data in relation to payment delays Intrum publishes the “European Payment Report”. It its 2022 edition half respondents warn that inflation is getting in the way of their growth plans. At the same time, almost 6 in 10 (58%) say rising prices are making it harder for them to pay their suppliers on time, which will create a knock-on effect further down the supply chain. Rising inflation is also the main challenge that Austrians expect will impact their customers’ ability to pay on time and in full, 71% named this as the main concern, compared to the European average of 61%. Still, according to the 2023 country report on Austria by the European Commission, in 2022 only 32% of SMEs in Austria (EU27 average is 43%) experienced problems due to late payments in the last six months (only 5% regularly), while 67% shows no record of that, which is one of the highest rates in the EU (page 56). According to Intrum the gap in payment terms offered and actual payment duration is 6 days for consumers (B2C) and 14 days for business (B2B).

For Austria KSV1870 publishes a report called “Austrian Business Check” on payment practices. In its 2022 edition the poll shows that Austrian corporate customers need a little more time to pay. The survey showed that 78.4% of corporate customers still pay their invoices within the agreed payment period, but this is a drop of 5.1 pp compared to the previous year. The average payment term remained the same as in the previous year at 20 days. However, the actual average payment duration has increased by 1 day to 25 days. This means that Austrian companies pay their invoices with an average payment delay of 5 days, which means an increase of 1 day compared to the previous year. This slight increase in late payments is also reflected in the assessment of payment practices. 64.1% of those surveyed state that the payment behaviour of their corporate customers remained good in 2022 compared to 2021 (a decrease of 9.7 pp). On the other hand, with an increase of 11 pp, 19.3% of the companies surveyed see their customers' payment practices deteriorating. When it comes to claims management, 48% of the companies surveyed only need to take action on up to 5% of their invoices. After all, a third of those surveyed apparently do not have to take any action. According to the surveyed companies, only 14.6% of the outstanding invoices are passed on to external service providers for processing. Of this, 8.1% goes to debt collection agencies, 5.2% by lawyers and 1.3% are immediately forwarded to the courts for legal action. The company-internal dunning process is still the main way to go for most companies, with 73.8% of companies sending their reminders by email, SMS or use an online customer portal. Only 3.8% state that they do not carry out any internal dunning at all.

For 2023 we can look at the Atradius Payment Practices Barometer, an annual survey of business-to-business (B2B) payment practices in markets across the world. The 2023 Payment Practices Barometer survey for Austria was conducted between the end of Q1 and the beginning of Q2 2023. According to the report, there is a rising trend in the level of payment delays suffered by Austrian companies, with payment periods increasing on average of 44% of all invoiced B2B sales. Payment terms were shortened by one week, and now stand at an average 32 days from invoicing. As shown in the KSV1870 report, 79% of companies polled said they preferred in-house retention and management of customer credit risk. As mentioned in the other reports fears about high inflation are continuing to be a burden on B2B trade and it is the main concern looking ahead for companies in Austria across all sectors polled.

According to the Austrian collection profile created by Allianz Trade the payment behaviour of domestic companies is optimal and the EU legal framework provides reliable tools when it comes to late-payment issues. Allianz concludes that the court system is efficient and reliable overall, but pre-legal action conducted by specialists remains the most effective method of collecting debt.

This leads us straight into the other category, namely bankruptcies and insolvencies. According to KSV1870, 4,775 companies were affected by insolvency in Austria in 2022, which is an increase of 57.4% compared to 2021. Creditreform counts 4,913 corporate bankruptcies, which is an increase of 59.7% in their books. For the first time since the outbreak of the corona pandemic, the pre-crisis level of 2019 with around 5.000 cases was almost reached. All nine federal states recorded increases. Most insolvencies are recorded in retail, construction and gastronomy. After the number of insolvencies in Austria had levelled off at the pre-crisis level, there was a renewed increase at the beginning of 2023. According to the current KSV1870 evaluation, 1,328 companies in Austria (+ 27% compared to 2022) were affected by insolvency in the first quarter of 2023. This means that for the first time there are more insolvent companies (+ 5%) than in 2019, the year before the corona pandemic. Looking towards the end of the year, projections estimate that up to 5,500 company bankruptcies can materialize.

Due to the general company size structure of the domestic economy, it is not surprising that the share of SMEs in the total insolvencies is almost the same. Insolvencies of large companies are rare in Austria. The COVID-19 pandemic has not changed this status quo to any significant extent. There is also no indication that government corona aid would have supported one or the other segment to a greater or lesser extent and prevented insolvencies there.

Table 4.4. . Development of bankruptcies, 2019-22

Year	SME		Total	Change to previous year in %	SME share
	Yes	No
2019	5 220	15	5 235	+ 0.2	99.7
2020	3 087	19	3 106	- 40.7	99.4
2021	3 071	5	3 076	- 1.0	99.8
2022	4 903	10	4 913	+ 59.7	99.8
Total	16 281	49	16 330		99.7

Source: Creditreform (2023)

An analysis conducted by Creditreform delivers an international comparison and shows that in the countries of Western Europe - in the context of the analysis, the EU-14 countries as well as Norway, Switzerland and Great Britain - there was a noticeable increase in corporate insolvencies in 2022. Compared to the previous year (2021: 112,686 cases), the number of corporate insolvencies increased by 24.2 percent. Almost 140,000 corporate insolvencies were registered. This is the highest level since 2019. Austria experienced the highest increase in insolvencies in Western Europe 2021/22 with +59.7%. This finding is also supported by the “Insolvency report” conducted by Allianz research, which looked at a lot more countries, where only Hungary has experienced more insolvencies than Austria with +65%. According to Allianz research, lower growth in 2023 and 2024 will take its toll: they calculate that the Eurozone and the US would need 1.3 pp and 1.5 pp of additional GDP growth on average in 2023-2024 to stabilize the number of insolvencies. They also point out that access to finance, hence no tightening of credit conditions, is needed to avert foreclosures.

Government policy response

In this current economic situation of high prices and global uncertainty, Austria - compared to other European countries - has implemented one of the most extensive packages of measures to cushion the social and economic consequences of high inflation and energy prices.

Combating high inflation and energy prices

Most of the measures were decided as part of three relief packages between January and August 2022 and additional measures were added as the crisis progressed. A fourth relief package was last approved in May 2023. This includes, among other things, EUR 400 million to extend the suspension of electricity and natural gas taxes until the end of 2023, as well as EUR 500 million in temporary payments for families and the financially weak. In a study from May 2023 WIFO calculated that the relief volume totals EUR 48.7 billion in the period from 2022 to 2026, EUR 48.1 billion of which comes from the federal government. The share that goes to private households is 78.4%; 21.6% go to companies and to agriculture and forestry. Almost 47% of the total volume consists of expenditure-side relief and a good 53% of tax and levy relief according to WIFO. EUR 8.3 billion in short-term structural measures and EUR 2.1 billion in long-term structural measures (reduction in non-wage labour costs) are granted to companies and to agriculture and forestry. The overall high proportion of long-term structural measures (around 52% of the total volume) is likely to be one reason for the relatively high total volume of relief measures in a European comparison according to WIFO.

Energy cost subsidy for companies

With the energy cost subsidy, the federal government is reacting to the increased energy prices in order to cushion the energy costs for companies by covering 30 percent of the price difference compared to the previous year for electricity, natural gas and fuel. In addition to the energy cost subsidy, a flat-rate subsidy is offered for small and micro-enterprises.

Transformation initiative

Especially in these economically challenging times, it is crucial to support research and development as well to stimulate investments and thus accelerate the transformation of the business model. For this reason the federal government's climate and transformation initiative was launched. The transformation to a future-proof business model based on renewable energies requires a great deal of effort from many Austrian companies. As part of the climate and transformation initiative, industry and SMEs are supported by the federal government in their sustainable transformation.

Funding is provided in three specific tracks:

1. Research and technology development promotion: The funding runs through existing basic programmes at the FFG, which have already been very popular. Around 80 projects were funded each year in 2020-2022. Unfortunately, the full potential could not be exploited due to insufficient financial resources, demand exceeded available funding. Therefore, additional funds are being put in place to advance the transformation. On the one hand, so-called transformative company projects are funded, i.e. the development of services that make a significant contribution to making the Austrian economy more sustainable, more crisis-resistant or more independent. “Frontrunner projects” are also funded. These are projects that aim to take a leading role in the implementation of new technologies, business models or processes.

2. Qualification measures: Sustainable industrial development also requires a corresponding change in the world of work and further training measures so that there are enough key workers available. Therefore, as part of the climate and transformation initiative, the development of the relevant skills for workers and specialists in Austrian companies is also being promoted.

3. Location and investment promotion: The focus here will be on the translation of research activity into production and practice in combination with the implementation of the necessary modernization and digitization processes.

The focus is on the key sectors automotive, microelectronics and life sciences - but in principle all sectors are eligible to apply. Implementation runs mainly through the proven funding agencies FFG and AWS.

Funding agencies

In Austria, several institutions at the federal as well as on the state level provide financial support for businesses. These federal institutions are providing loan guarantees and/or direct lending to SMEs. The Austria Wirtschaftsservice GmbH (AWS) serves as the federal promotional bank and offers Austrian enterprises financial support in the form of loans (via the ERP-Fund6), guarantees, grants and equity, as well as consulting services. The Forschungsförderungsgesellschaft GmbH (FFG) is the national funding institution for applied research and development and provides grants, loans, guarantees and consulting services. In July 2020, a new and improved legal framework for the financing of research, technology and innovation with the resolution of the Research Financing Act (FoFinaG) was created. The Oesterreichische Hotel- und Tourismusbank (ÖHT) is owned by private banks and is specialised in financing and promoting investments in the field of tourism by means of loans, guarantees and grants, which are supported by the government.

Guarantees

The Austrian promotional bank (AWS) had an exceptional year 2021 with 1,368 guarantees for a commitment of EUR 407 million. The year 2022 is back on the pre-crisis level according to AWS with 1,140 guarantees for a commitment of EUR 329.1 million, the same values as in 2018 (1,165 guarantees for EUR 335.5 million) and 2019 (1,148 guarantees for EUR 421.8 million) were achieved. In order to intensify the AWS guarantees, the AWS applied for counter-guarantees from the InvestEU programme of the European Union at the European Investment Fund (EIF) in 2022. Counter-guarantees via the EIF have been used by the AWS since 1998 to enable Austrian companies to participate in EU financial instruments and to be able to offer companies better guarantee conditions. The application made by the AWS through the EIF in July 2022 was approved by the European Commission in December 2022. With the EU financial programme InvestEU, a base was created in 2020 for EU funds to be made available to the member states in the form of guarantees to finance innovative and sustainable projects. In 2021, the AWS applied for the direct processing of these guarantee programs and submitted a corresponding application for funding to the European Commission. This should enable AWS in the future to work directly for the European Commission as a so-called implementing partner.

Loan guarantees granted by ÖHT are counter-guaranteed by the government. The guarantees cover loans from commercial banks, but can also be combined with ERP-loans and TOP-A loans granted by ÖHT. To a lesser extent, loan guarantees are also provided by the FFG.

ERP credit

The year 2022 was again characterized by a very high demand for AWS ERP loans in all economic sectors. The funds for 2022 were almost completely allocated by September 2022, so that in the fourth quarter a significant number of loan applicants had to be referred to the 2023 annual program. The sharp increase in key interest rates in the fourth quarter and the continued increase in interest rate expectations among companies led to a strong increase in demand for fixed interest rate models. This design of the credit conditions brings improved security and stability for a successful project implementation, especially for large investment projects. In total, 1,026 loans were approved with the annual program for 2022 and more than EUR 625 million in investments were triggered. The ÖHT reports 74 cases with an ERP small credit volume of EUR 15 million and a triggered investment volume of EUR 21 million.

Other instruments

All of the funding agencies also offer a variety of other instruments and programs. Especially services such as consulting, coaching and networking are important for interested SMEs. Specific programs for current challenges are being put in place quickly when demand suddenly becomes urgent, such as the Ukraine-War Special Support Program by AWS. Many specific programs also are available, such as the AWS SME Cybersecurity Support Program to train companies in preventive measures in the field of IT security for example.

Risk capital

Austria has some catching up to do when it comes to risk capital financing. Due to the current global economic developments, start-ups and innovative young companies are currently experiencing particularly large hurdles when it comes to financing, especially in growth phases. Therefore, a new venture capital fund has been set up with the AWS “Gründerfonds II” (Start-up Fund), which together with private investors creates new impetus for venture and growth capital in Austria. This is based on the successful AWS “Gründerfonds” and has now officially started with the entry in the company register. With this, the AWS “Gründerfonds II” can start the investment phase. The new fund is providing up to EUR 72 million for investments from the federal government. The AWS Gründerfonds II offers long-term growth capital. In the form of open or silent participation, it is also structured in a way that is typical of the industry, offering conditions in line with the market and is open to co-investments. The AWS “Gründerfonds II” therefore sees itself as a long-term, stable partner and offers entrepreneurial venture capital with active support.

Figure 4.4. Trends in SME and entrepreneurship finance in Austria

Source: See Table 4.5.

Statlink

Table 4.5. Sources and definitions of Austria’s Scoreboard

Indicator	Definition	Source
Debt
Outstanding business loans, total	Loans granted to the corporate sector by a sample of 103 Austrian banks	Austrian National Bank
Business loans, SMEs	New business loans to non-financial corporations granted by a sample of 103 Banks, the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors; loan size up to EUR 1 million	Austrian National Bank
Business loans, total	New business loans to non-financial corporations granted by a sample of 103 Banks; the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors	Austrian National Bank
Long-term loans, SME	New business loans to non-financial corporations granted by a sample of 103 Banks; the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors, loan size up to EUR 1 million and original maturity over 6 months	Austrian National Bank
Short-term loans, SMEs	New business loans to non-financial corporations granted by a sample of 103 Banks; the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors; loan size up to EUR 1 million and original maturity up to 6 months	Austrian National Bank
Government loan guarantees, SMEs	Loan guarantees granted to SMEs (defined as firms with less than 250 employees) proxied by loan guarantees from aws, ÖHT and FFG, flows	Administrative data from Austria Wirtschaftsservice GmbH, Österreichische Hotel- und Tourismusbank; Forschungsförderungsgesellschaft GmbH
Government guaranteed loans, SMEs	New loans to SMEs (defined as firms with less than 250 employees) covered by guarantees from aws, ÖHT, FFG, including ERP-loans, flows	Administrative data from Austria Wirtschaftsservice GmbH, Österreichische Hotel- und Tourismusbank GmbH; Forschungsförderungsgesellschaft GmbH
Government direct loans, SMEs	New loans to SMEs (defined as firms with less than 250 employees) provided by the ERP-Fund, ÖHT, FFG, flows	Administrative data from Austria Wirtschaftsservice GmbH, Österreichische Hotel- und Tourismusbank; Forschungsförderungsgesellschaft GmbH,
Interest rate, SMEs	Average interest rate for new business loans to non-financial corporations; the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors, loan size up to EUR 1 million	Austrian National Bank
Interest rate, large firms	Average interest rate for new business loans to non-financial corporations; the data exclude overdrafts, revolving loans, securitised loans and loans to sole proprietors, loan size over EUR 1 million	Austrian National Bank
Interest rate spread	Difference between interest rates for new business loans to non-financial corporations; loan size up to EUR 1 million and over EUR 1 million	Austrian National Bank
Percentage of SME loan applications	ECB, Statistical Data Warehouse, "SAFE" Survey	ECB/European Commission, Survey on the Access to Finance
Rejection rate	ECB, Statistical Data Warehouse, "SAFE" Survey,	ECB/European Commission, Survey on the Access to Finance
Non-performing loans	Percentage of non-performing loans in relation to total outstanding business loans	Austrian National Bank
Equity
Venture and growth capital	Venture and growth capital invested in Austrian firms, including seed, start-up, later-stage venture and growth capital (market statistics), all firms	Invest Europe
Other
Payment delays business to business	Average number of days for business to business, all firms	Intrum AB; European Payment Report
Payment delays business to consumer	Average number of days for business to consumer, all firms	Intrum AB; European Payment Report
Bankruptcies, total	Total number of companies filed for insolvency; total and per 1 000 enterprises,	Creditreform

References

Allianz Research (2023): “No rest for the leveraged - Insolvency report”, https://www.allianz.com/content/dam/onemarketing/azcom/Allianz_com/economic-research/publications/specials/en/2023/april/2023_04_11_Insolvency-Report_AZ.pdf

Allianz Trade: “Austria collection profile”, https://www.allianz-trade.com/en_global/economic-research/collection-complexity/austria.html

Atradius (2023): „Payment Practices Barometer“, https://group.atradius.com/publications/payment-practices-barometer/b2b-payment-practices-trends-austria-2023.html

Austrian Council for Research and Technology Development (2002): “Bericht zur wissenschaftlichen und technologischen Leistungsfähigkeit Österreichs 2022“, https://fti-monitor.rfte.at/docs/pdf/L100011.pdf

Austrian Startup Monitor (2022): “Special Issue Internationalisation - Key Facts of the Austrian Startup Ecosystem”, https://austrianstartupmonitor.at/wp‑content/uploads/2023/03/Special_Issue_Internationalisation_2022.pdf

Austria Wirtschaftsservice: “Leistungsbericht”, https://www.aws.at/berichte/

Bundesministerium für Arbeit und Wirtschaft (2023): “KMU im Fokus 2022 - Bericht über die Situation und Entwicklung kleiner und mittlerer Unternehmen der österreichischen Wirtschaft“, https://kmuimfokus.at/

Creditreform (2023): “Insolvenzstatistik 2022”, https://www.creditreform.at/wien/aktuelles‑wissen/show/insolvenzstatistik-2021-1

Creditreform (2023): “Unternehmensinsolvenzen in Europa 2022”, https://www.creditreform.at/wien/aktuelles-wissen/show/pressekonferenz-unternehmensinsolvenzen-in-europa-jahr-2022

ETH Zürich KOF Swiss Economic Institute (2022): “KOF Globalisation Index”, https://kof.ethz.ch/en/forecasts-and-indicators/indicators/kof-globalisation-index.html

European Commission (2023): “2023 Country Report - Austria”, https://economy-finance.ec.europa.eu/system/files/2023-05/AT_SWD_2023_620_en.pdf

European Investment Fund (2002): “The 2021 EIF SME Access to Finance Index, October 2022 update”, Working Paper 2022/83, https://www.eif.org/news_centre/publications/eif_working_paper_2022_83.pdf

EU Federation Factoring & Commercial Finance (2022): “Annual Factoring Data”, https://euf.eu.com/data-statistics/annual-factoring-data.html

EY (2023): “Start-up Investment Barometer Österreich 2022”, https://www.ey.com/de_at/news/2023/02/ey-start-up-investment-barometer-oesterreich-2022

FFG: “Jahresbericht”, https://www.ffg.at/publikationen#jahresbericht

Intrum (2022): “European Payment Report”, https://www.intrum.com/publications/european-payment-report/european-payment-report-2022/

Invest Europe (2022): “Annual activity statistics”, https://www.investeurope.eu/research/activity-data/

KSV1870 (2023): „Insolvenzstatistiken - finale Zahlen“, https://www.ksv.at/presse/insolvenzstatistik

KSV1870 (2022): “Austrian Business Check zur Zahlungsmoral“, https://www.ksv.at/KSV1870_AustrianBusinessCheck_Zahlungsmoral2022_Studie

OeNB (2022): “Statistiken – Daten und Analysen Q4-22“, https://www.oenb.at/Publikationen/Statistik/Statistiken---Daten-und-Analysen/2022/statistiken-daten-und-analysen-q4-22/statistiken-daten-und-analysen-q4-22-html.html

OeNB (2023): “Statistiken – Daten und Analysen H1-23“, https://www.oenb.at/Publikationen/Statistik/Statistiken---Daten-und-Analysen.html

ÖHT: “Tätigkeitsbericht”, https://www.oeht.at/die-tourismusbank/ueber-uns/

Österreichischer Factoring Verband (2022): “Factoring-Markt Österreich“, https://www.factoring-verband.at/markt/factoring-markt-oesterreich/

Statistics Austria (2023): “Structural business statistics”, https://www.statistik.at/statistiken/industrie-bau-handel-und-dienstleistungen/leistungs-und-strukturdaten

WIFO (2023): “Österreichs Anti-Teuerungsmaßnahmen 2022 bis 2026. Treffsicherheit und ökologische Aspekte“, WIFO Research Briefs 7/2023

WKO (2023): Unternehmensgründungen - Gründergeist auch 2022 ungebrochen, https://news.wko.at/news/oesterreich/zahl-der-unternehmensgruendungen-2022-weiter-hoch.html

Notes

← 1.  The new Regulation on Structural Statistics results in conceptual changes from the 2021 reporting year. The results for the 2021 reporting year were computed according to these new specifications, which means that the results are only comparable to the previous year (reporting year 2020) to a limited extent.

← 2.  The new Regulation on Structural Statistics results in conceptual changes from the 2021 reporting year. The results for the 2021 reporting year were computed according to these new specifications, which means that the results are only comparable to the previous year (reporting year 2020) to a limited extent.

← 3.  There are several factors that shape this relationship: i) generally higher equity financing (equity ratio) of larger companies, ii) use of more diverse financing instruments in larger companies, especially in the area of external self-financing (partners, investors, equity financing through to stocks/stock exchanges), or bonds, iii) It is possible that profits in large companies can also be reinvested more easily (internal financing), while in smaller companies they are often used for private life.

← 4.  Bank debt ratio = total bank liabilities / total capital * 100

The significant difference in bank debt can be explained by the industry-related, different asset and financing structure. The often high level of fixed assets in the accommodation and gastronomy industry usually requires financing through long-term loans.

← 5.  These are very short-term cash advances (“Barvorlagen”) that are subject to beneficial interest rates.

← 6.  The ERP Fund (European Recovery Programme Fund) was established in 1962 and provides soft loans (ERP loans) with reduced interest rates via commercial banks to new and existing businesses in the areas of technology assistance, implementation of research and technological development initiatives, and establishment of pilot and demonstration facilities. It is a separate legal entity and is organisationally integrated into the AWS since 2002. The ÖHT serves as the trust bank of the ERP Fund in the tourism sector. The ERP-annual working program adopted by the Austrian Federal Government sets up the underlying conditions of the ERP-loan programs.