Instituto de Crédito Oficial (ICO)

What is ICO?

Instituto de Crédito Oficial, Corporate State-owned Entity (henceforth, ICO), is a state-owned bank, with the legal status of corporate state-owned entity, attached to the Ministry of Economic Affairs, Industry and Competitiveness via the State Secretariat for Economy and Enterprise Support.

From a legal point of view it is a credit institution, and is treated as a State Finance Agency, with its own legal status, assets and treasury, as well as an independent management to carry out its activities.

ICO is a state-owned bank and is governed by the financial equilibrium principle, in accordance with its Articles of Incorporation, which were approved in Royal Decree 706/1999 of 30 April.

It finances itself on the national and international capital markets. The debts and obligations it enters into with third parties benefit from the explicit, irrevocable, unconditional and direct guarantee of the Spanish State.

Apart from the Institute, the ICO Group comprises Axis, a venture capital firm, and the Fundación ICO.

Axis was the first venture capital firm to be established in Spain, in 1986, and currently provides equity or quasi-equity instruments to companies to finance their growth.

The Fundación ICO was created in 1993 in order to promote culture and art. Since 2003 it has existed as an ongoing, not-for-profit, public sector foundation with a national scope and independent assets.

ICO also participates as a shareholder in other companies such as the Compañía Española de Reafianzamiento (CERSA) and the Compañía Española de Financiación del Desarrollo (COFIDES), as well as the European Investment Fund (EIF).


ICO was created in 1971 as the institution responsible for co-ordinating the state-owned banks existing at the time. Its structure and the way it would function were regulated in Law 13/1971 of 19 June, the Official Credit System and Organisation Act.

The Finance Act (Ley de Presupuestos Generales del Estado) of 1988 amended the legal status of ICO, and the Institute changed from being an independent body to a state-owned company, treated as a credit institution and taking on the name of the official state-owned bank, which at that time was made up of: the Banco de Crédito Industrial, Banco de Crédito Agrícola, Banco de Crédito Local and the Banco Hipotecario de España, also holding a major stake of the Banco Exterior de España shareholdings. From then on it stopped receiving funding exclusively from the Treasury and started to finance itself mainly from capital markets.

The reform of the state-owned banking sector in May 1991 had two immediate consequences. One of them was the integration of the whole state-owned banking sector into the Spanish banking corporation, Argentaria. This started off as a commercial bank, with the aim of gradually being privatised. The second consequence was the maintenance of ICO as a Financial Agency of the State and state-owned bank, independent and separate from the latter. From then on, the Institute began a new phase in its activity, its main goal becoming to boost the real economy, to achieve the purposes established in its Articles of Incorporation, which were approved in 1999.

Mission and Functions

Its functions are to promote economic activities contributing to growth, the development of the country and improving the distribution of the national wealth. Particularly, those activities of a social, cultural, environmental or innovative significance are awarded special attention.

To achieve these goals, ICO acts in two clearly distinct ways:

1. As a State-Owned Bank: ICO provides loans to fund company investment and liquidity operations inside and outside of Spain, and acts in two ways:

  • Second-floor facilities: ICO designs and sets the main characteristics of the different lines of credit, as well as signing the corresponding Collaboration Agreements with the Credit Institutions for them to be sold through their networks. These lines are mainly directed at the self-employed and small and medium-sized companies. ICO determines the amounts of each line of credit, the purpose of the loans, the interest rates and repayment terms, and provides funds to financial institutions. The latter are in charge of analysing operations, deciding the guarantees that must be provided, deciding on the approval of funding and assuming the risks involved.
  • Direct funding: this is corporate structured finance for large projects involving productive, public or private investment. It is provided through are loans designed to match the applicant company's needs, with a minimum amount of €10 million and long repayment terms. To apply for these loans companies go to ICO directly, who study, grant and take on the risk of the operations concerned. Funding is granted preferably in collaboration with private or public entities, whether national, international or multilateral.

2. As a State Finance Agency: ICO manages the official funding instruments that the Spanish State provides for encouraging exports and development aid, with the State compensating ICO for any costs these processes may entail.This type also includes ICO funding, on express instructions from the Government, for those affected by natural disasters, environmental disasters and other events of general interest. For these types of operations, ICO does not take on the risk and therefore acts only after public funds have been provided and/or through compensation of interest rate differentials.




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