# C_2018350EN.01000101.xml

| 28.9.2018 | EN | Official Journal of the European Union | C 350/1 |
| --- | --- | --- | --- |

28.9.2018

EN

Official Journal of the European Union

C 350/1

---

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL AND THE COURT OF AUDITORS

Annual accounts of the European Development Fund 2017

(2018/C 350/01)

CONTENTS

| CERTIFICATION OF THE ACCOUNTS | 2 |
| --- | --- |

| IMPLEMENTING AND ACCOUNTING FOR THE EDF RESOURCES | 3 |
| --- | --- |

| FUNDS MANAGED BY THE EUROPEAN COMMISSION | 6 |
| --- | --- |

| FINANCIAL STATEMENTS OF THE EDF | 8 |
| --- | --- |

| NOTES TO THE FINANCIAL STATEMENTS OF THE EDF | 17 |
| --- | --- |

| FINANCIAL STATEMENTS OF THE EU TRUST FUNDS CONSOLIDATED IN EDF | 43 |
| --- | --- |

| ANNUAL ACCOUNTS OF THE BÊKOU EU TRUST FUND 2017 | 44 |
| --- | --- |

| ANNUAL ACCOUNTS OF THE EUTF FOR AFRICA 2017 | 51 |
| --- | --- |

| CONSOLIDATED FINANCIAL STATEMENTS OF THE EDF AND THE EU TRUST FUNDS | 58 |
| --- | --- |

| EDF REPORT ON FINANCIAL IMPLEMENTATION | 63 |
| --- | --- |

| ANNUAL REPORT ON IMPLEMENTATION — FUNDS MANAGED BY THE EUROPEAN INVESTMENT BANK | 91 |
| --- | --- |

CERTIFICATION OF THE ACCOUNTS

The annual accounts of the European Development Fund for the year 2017 have been prepared in accordance with Title IX of the Financial Regulation of the 11th European Development Fund and with the accounting principles, rules and methods set out in the notes to the financial statements.

I acknowledge my responsibility for the preparation and presentation of the annual accounts of the European Development Fund in accordance with Article 20 of the Financial Regulation of the 11th European Development Fund.

I have obtained from the authorising officer and from the EIB, who guarantee its reliability, all the information necessary for the production of the accounts that show the European Development Fund’s assets and liabilities and the budgetary implementation.

I hereby certify that based on this information, and on such checks as I deemed necessary to sign off the accounts, I have a reasonable assurance that the accounts present a true and fair view of the financial position of the European Development Fund in all material aspects.

Rosa ALDEA BUSQUETS

Accounting Officer

20 June 2018

IMPLEMENTING AND ACCOUNTING FOR THE EDF RESOURCES

IMPLEMENTING AND ACCOUNTING FOR THE EDF RESOURCES

1.   BACKGROUND

BACKGROUND

The European Union (hereinafter referred to as the EU) has cooperative relations with a large number of developing countries. The main objective is to promote economic, social and environmental development, with the primary aim of reducing and eradicating poverty in the long-term, by providing beneficiary countries with development aid and technical assistance. To achieve this, the EU draws up, jointly with the partner countries, cooperation strategies and mobilises the financial resources to implement them. These EU resources allocated to development cooperation come from three sources:

| — | The EU budget; |
| --- | --- |

—

The EU budget;

| — | The European Development Fund; |
| --- | --- |

—

The European Development Fund;

| — | The European Investment Bank. |
| --- | --- |

—

The European Investment Bank.

The European Development Fund (hereinafter referred to as the EDF) is the main instrument for providing EU aid for development cooperation to the African, Caribbean and Pacific (hereinafter referred to as the ACP) States and Overseas Countries and Territories (hereinafter referred to as the OCTs).

The EDF is not funded by the EU budget. It is established by an internal agreement of the Representatives of the Member States, sitting within the Council, and managed by a specific committee. The European Commission (hereinafter referred to as the Commission) is responsible for the financial implementation of the operations carried out with EDF resources. The European Investment Bank (hereinafter referred to as the EIB) manages the Investment Facility.

During the period 2014-2020, the geographic aid granted to ACP States and OCTs will continue to be mainly funded by the EDF. Each EDF is usually concluded for a period of around five years and is governed by its own Financial Regulation which requires the preparation of financial statements for each individual EDF. Accordingly, financial statements are prepared separately for each EDF in respect of the part that is managed by the Commission. These financial statements are also presented in an aggregated way so as to provide a global view of the financial situation of the resources for which the Commission is responsible.

The Internal Agreement establishing the 11th EDF was signed by the participating Member States, meeting within the Council, in June 2013 (1). It came into force on 1 March 2015. In order to assure continuity between the end of the 10th EDF and the entry into force of the 11th EDF, the Commission proposed transitional measures, known as the Bridging Facility (BF) (2). The BF is presented under the 11th EDF.

1

2

At the same time the 10th EDF Financial Regulation (3) was amended and the new Financial Regulation applicable to the transition period was adopted (4). They entered into force on 30 May 2014. On 2 March 2015 the Council adopted the 11th EDF Financial Regulation (5) and the Implementation Rules (6). They entered into force on 6 March 2015.

3

4

5

6

Within the framework of the ACP-EU Partnership Agreement, the Investment Facility was established. This Investment Facility is managed by the EIB and is used to support private sector development in the ACP States by financing essentially — but not exclusively — private investments. The Facility is designed as a renewable fund, so that loan repayments can be reinvested in other operations, thus resulting in a self-renewing and financially independent facility. As the Investment Facility is not managed by the Commission, it is not consolidated in the first part of the annual accounts — the financial statements of the EDF and the related report on financial implementation. The financial statements of the Investment Facility are included as a separate part of the annual accounts (part II) to provide a full picture of the development aid of the EDF (7).

7

2.   HOW IS THE EDF FUNDED?

HOW IS THE EDF FUNDED?

The European Council of 2 December 2013 adopted the Multi-annual Financial Framework for 2014-2020. In this context, it was decided that geographical cooperation with the ACP States would not be integrated into the EU budget (budgetised), but would continue to be funded through the existing inter-governmental EDF.

The EU budget is annual and according to the budgetary principle of annuality, expenditure and revenue are planned and authorised for one year. Unlike the EU budget, the EDF is a fund operating on the basis of multiannuality. Each EDF establishes an overall fund to implement development cooperation during a period of usually five years. As resources are allocated on a multiannual basis, the allocated funds may be used over the period of the EDF. The lack of budget annuality is highlighted in the budgetary reporting, where the budgetary implementation of the EDFs is measured against the total funds.

The EDF resources are ‘ad hoc’ contributions from the EU Member States. Approximately every five years, Member State representatives meet at intergovernmental level to decide on an overall amount that will be allocated to the fund and to oversee its implementation. The Commission then manages the fund in accordance with the Union policy on development cooperation. Since Member States have their own development and aid policies in parallel to the Union policy, the Member States must coordinate their policies with the EU to ensure they are complementary.

In addition to the abovementioned contributions, it is also possible for Member States to enter into co-financing arrangements or to make voluntary financial contributions to the EDF.

3.   YEAR-END REPORTING

YEAR-END REPORTING

3.1.   ANNUAL ACCOUNTS

ANNUAL ACCOUNTS

In accordance with Article 46 of the EDF Financial Regulation, the EDF financial statements are prepared on the basis of accrual-based accounting rules that themselves are based on International Public Sector Accounting Standards (IPSAS). The accounting rules adopted by the Accounting Officer of the Commission are applied by all the Institutions and bodies of the EU in order to establish a uniform set of rules for accounting, valuation and presentation of the accounts with a view to harmonising the process for drawing up the financial statements and consolidation, as required by Article 152 of the EU Financial Regulation. These rules EU accounting rules are also applied to the EDF while taking into account the specific nature of its activities.

The preparation of the EDF annual accounts is entrusted to the Commission’s Accounting Officer who is the Accounting Officer of the EDF. She ensures that the annual accounts of EDF present a true and fair view of the financial position of the EDF.

The annual accounts are presented as follows:

Part I: Funds managed by the Commission

| | (i) | Financial statements and explanatory notes of the EDF |
| --- | --- | --- |

(i)

Financial statements and explanatory notes of the EDF

| (ii) | Financial statements of the EU trust funds consolidated in the EDF |
| --- | --- |

(ii)

Financial statements of the EU trust funds consolidated in the EDF

| (iii) | Consolidated financial statements of EDF and the EU trust funds |
| --- | --- |

(iii)

Consolidated financial statements of EDF and the EU trust funds

| (iv) | Report on financial implementation of the EDF |
| --- | --- |

(iv)

Report on financial implementation of the EDF

Part II: Annual report on implementation — Funds managed by the EIB

| | (i) | Financial statements of the Investment Facility |
| --- | --- | --- |

(i)

Financial statements of the Investment Facility

The part ‘Financial statements of the European trust funds consolidated in the EDF’ includes financial statements of the two trust funds created under the EDF: The Bêkou EU Trust Fund (see section ‘Financial statements of the Bêkou EU Trust Fund’) and The EU Trust Fund for Africa (see section ‘Financial statements of EU Trust Fund for Africa’). The trust funds individual financial statements are prepared under the responsibility of the EC Accounting Officer and subject to external audit carried out by a private auditor. The trust funds’ figures included in these annual accounts are final, i.e. after the necessary audit adjustments, but the accounts have not yet been formally signed-off.

The annual accounts must be adopted by the Commission not later than 31 July of the subsequent year and presented to the European Parliament and to the Council for discharge.

4.   AUDIT AND DISCHARGE

AUDIT AND DISCHARGE

4.1.   AUDIT

AUDIT

The EDF annual accounts and resource management are overseen by its external auditor, the European Court of Auditors (hereinafter referred to as the ECA), which draws up an annual report for the European Parliament and the Council.

4.2.   DISCHARGE

DISCHARGE

The final control is the discharge of the financial implementation of the EDF resources for a given financial year. The European Parliament is the discharge authority of the EDF. This means that following the audit and finalisation of the annual accounts it falls to the Council to recommend and then to the European Parliament to decide whether to grant discharge to the Commission for the financial implementation of the EDF resources for a given financial year. This decision is based on a review of the accounts and the annual report of the ECA (which includes an official statement of assurance) and replies of the Commission, and also following questions and further information requests to the Commission.

FUNDS MANAGED BY THE EUROPEAN COMMISSION (1)

FUNDS MANAGED BY THE EUROPEAN COMMISSION

1

CONTENTS

CONTENTS

| FINANCIAL STATEMENTS OF THE EDF | 8 |
| --- | --- |

| EDF BALANCE SHEET | 9 |
| --- | --- |

| EDF STATEMENT OF FINANCIAL PERFORMANCE | 10 |
| --- | --- |

| EDF CASH FLOW STATEMENT | 11 |
| --- | --- |

| EDF STATEMENT OF CHANGES IN NET ASSETS | 12 |
| --- | --- |

| BALANCE SHEET BY EDF | 13 |
| --- | --- |

| STATEMENT OF FINANCIAL PERFORMANCE BY EDF | 14 |
| --- | --- |

| STATEMENT OF CHANGES IN NET ASSETS BY EDF | 15 |
| --- | --- |

| NOTES TO THE FINANCIAL STATEMENTS OF THE EDF | 17 |
| --- | --- |

| FINANCIAL STATEMENTS OF THE EU TRUST FUNDS CONSOLIDATED IN EDF | 43 |
| --- | --- |

| ANNUAL ACCOUNTS OF THE BÊKOU EU TRUST FUND 2017 | 44 |
| --- | --- |

| BACKGROUND INFORMATION ON THE BÊKOU EU TRUST FUND | 45 |
| --- | --- |

| BALANCE SHEET | 48 |
| --- | --- |

| STATEMENT OF FINANCIAL PERFORMANCE | 49 |
| --- | --- |

| CASH FLOW STATEMENT | 49 |
| --- | --- |

| STATEMENT OF CHANGES IN NET ASSETS | 50 |
| --- | --- |

| ANNUAL ACCOUNTS OF THE EUTF FOR AFRICA 2017 | 51 |
| --- | --- |

| BACKGROUND INFORMATION ON THE EUTF FOR AFRICA | 52 |
| --- | --- |

| BALANCE SHEET | 55 |
| --- | --- |

| STATEMENT OF FINANCIAL PERFORMANCE | 56 |
| --- | --- |

| CASH FLOW STATEMENT | 56 |
| --- | --- |

| STATEMENT OF CHANGES IN NET ASSETS | 57 |
| --- | --- |

| CONSOLIDATED FINANCIAL STATEMENTS OF THE EDF AND THE EU TRUST FUNDS | 58 |
| --- | --- |

| CONSOLIDATED BALANCE SHEET | 59 |
| --- | --- |

| CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE | 60 |
| --- | --- |

| CONSOLIDATED CASH FLOW STATEMENT | 61 |
| --- | --- |

| CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS | 62 |
| --- | --- |

| EDF REPORT ON FINANCIAL IMPLEMENTATION | 63 |
| --- | --- |

FINANCIAL STATEMENTS OF THE EDF (8)

FINANCIAL STATEMENTS OF THE EDF

8

EDF BALANCE SHEET

EDF BALANCE SHEET

| (EUR millions) |
| --- |
| | Note | 31.12.2017 | 31.12.2016 |
| NON-CURRENT ASSETS | | | |
| Pre-financing | 2.1 | 582 | 409 |
| Trust Fund contributions | 2.2 | 163 | 98 |
| | | 745 | 507 |
| CURRENT ASSETS | | | |
| Pre-financing | 2.1 | 1 518 | 1 372 |
| Exchange receivables and non-exchange recoverables | 2.3 | 92 | 132 |
| Cash and cash equivalents | 2.4 | 347 | 680 |
| | | 1 958 | 2 184 |
| TOTAL ASSETS | | 2 703 | 2 691 |
| | | | |
| NON-CURRENT LIABILITIES | | | |
| Provisions | 2.5 | (4) | (4) |
| Financial liabilities | 2.6 | (14) | (6) |
| | | (18) | (10) |
| CURRENT LIABILITIES | | | |
| Payables | 2.7 | (563) | (549) |
| Accrued charges and deferred income | 2.8 | (733) | (776) |
| | | (1 296 ) | (1 324 ) |
| TOTAL LIABILITIES | | (1 314 ) | (1 334 ) |
| NET ASSETS | | 1 389 | 1 357 |
| FUNDS & RESERVES | | | |
| Called fund capital — active EDFs | 2.9 | 46 173 | 42 323 |
| Called fund capital from closed EDFs carried forward | 2.9 | 2 252 | 2 252 |
| Called fund capital transfers between active EDFs | 2.9 | — | — |
| Economic result carried forward from previous years | | (43 219 ) | (40 146 ) |
| Economic result of the year | | (3 818 ) | (3 073 ) |
| NET ASSETS | | 1 389 | 1 357 |

(EUR millions)

Note

31.12.2017

31.12.2016

NON-CURRENT ASSETS

NON-CURRENT ASSETS

Pre-financing

Pre-financing

2.1

2.1

582

582

409

409

Trust Fund contributions

Trust Fund contributions

2.2

2.2

163

163

98

98

745

745

507

507

CURRENT ASSETS

CURRENT ASSETS

Pre-financing

Pre-financing

2.1

2.1

1 518

1 518

1 372

1 372

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

2.3

2.3

92

92

132

132

Cash and cash equivalents

Cash and cash equivalents

2.4

2.4

347

347

680

680

1 958

1 958

2 184

2 184

TOTAL ASSETS

TOTAL ASSETS

2 703

2 703

2 691

2 691

NON-CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Provisions

Provisions

2.5

2.5

(4)

(4)

(4)

(4)

Financial liabilities

Financial liabilities

2.6

2.6

(14)

(14)

(6)

(6)

(18)

(18)

(10)

(10)

CURRENT LIABILITIES

CURRENT LIABILITIES

Payables

Payables

2.7

2.7

(563)

(563)

(549)

(549)

Accrued charges and deferred income

Accrued charges and deferred income

2.8

2.8

(733)

(733)

(776)

(776)

(1 296 )

(1 296 )

(1 324 )

(1 324 )

TOTAL LIABILITIES

TOTAL LIABILITIES

(1 314 )

(1 314 )

(1 334 )

(1 334 )

NET ASSETS

NET ASSETS

1 389

1 389

1 357

1 357

FUNDS & RESERVES

FUNDS & RESERVES

Called fund capital — active EDFs

Called fund capital — active EDFs

2.9

2.9

46 173

46 173

42 323

42 323

Called fund capital from closed EDFs carried forward

Called fund capital from closed EDFs carried forward

2.9

2.9

2 252

2 252

2 252

2 252

Called fund capital transfers between active EDFs

Called fund capital transfers between active EDFs

2.9

2.9

—

—

—

—

Economic result carried forward from previous years

Economic result carried forward from previous years

(43 219 )

(43 219 )

(40 146 )

(40 146 )

Economic result of the year

Economic result of the year

(3 818 )

(3 818 )

(3 073 )

(3 073 )

NET ASSETS

NET ASSETS

1 389

1 389

1 357

1 357

EDF STATEMENT OF FINANCIAL PERFORMANCE

EDF STATEMENT OF FINANCIAL PERFORMANCE

| (EUR millions) |
| --- |
| | Note | 2017 | 2016 |
| REVENUE | | | |
| Revenue from non-exchange transactions | 3.1 | | |
| Recovery activities | | 61 | 8 |
| | | 61 | 8 |
| Revenue from exchange transactions | 3.2 | | |
| Financial revenue | | 4 | 3 |
| Other revenue | | 22 | 62 |
| | | 25 | 66 |
| Total Revenue | | 87 | 73 |
| EXPENSES | | | |
| Aid instruments | 3.3 | (3 700 ) | (2 970 ) |
| Co-financing expenses | 3.4 | (42) | 15 |
| Finance costs | 3.6 | (8) | 4 |
| Other expenses | 3.7 | (154) | (196) |
| Total Expenses | | (3 904 ) | (3 146 ) |
| ECONOMIC RESULT OF THE YEAR | | (3 818 ) | (3 073 ) |

(EUR millions)

Note

2017

2016

REVENUE

REVENUE

Revenue from non-exchange transactions

Revenue from non-exchange transactions

3.1

3.1

Recovery activities

Recovery activities

61

61

8

8

61

61

8

8

Revenue from exchange transactions

Revenue from exchange transactions

3.2

3.2

Financial revenue

Financial revenue

4

4

3

3

Other revenue

Other revenue

22

22

62

62

25

25

66

66

Total Revenue

Total Revenue

87

87

73

73

EXPENSES

EXPENSES

Aid instruments

Aid instruments

3.3

3.3

(3 700 )

(3 700 )

(2 970 )

(2 970 )

Co-financing expenses

Co-financing expenses

3.4

3.4

(42)

(42)

15

15

Finance costs

Finance costs

3.6

3.6

(8)

(8)

4

4

Other expenses

Other expenses

3.7

3.7

(154)

(154)

(196)

(196)

Total Expenses

Total Expenses

(3 904 )

(3 904 )

(3 146 )

(3 146 )

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

(3 818 )

(3 818 )

(3 073 )

(3 073 )

EDF CASH FLOW STATEMENT

EDF CASH FLOW STATEMENT

| (EUR millions) |
| --- |
| | Note | 2017 | 2016 |
| Economic result of the year | | (3 818 ) | (3 073 ) |
| Operating activities | | | |
| Capital increase — contributions (net) | | 3 850 | 3 450 |
| (Increase)/decrease in trust funds contributions | | (66) | (64) |
| (Increase)/decrease in pre-financing | | (319) | (120) |
| (Increase)/decrease in exchange receivables and


  non-exchange recoverables | | 40 | 39 |
| Increase/(decrease) in financial liabilities | | 8 | (4) |
| Increase/(decrease) in payables | | 14 | 28 |
| Increase/(decrease) in accrued charges and deferred income | | (42) | (80) |
| NET CASH FLOW | | (333) | 177 |
| Net increase/(decrease) in cash and cash equivalents | | (333) | 177 |
| Cash and cash equivalents at the beginning of the year | 2.4 | 680 | 504 |
| Cash and cash equivalents at year-end | 2.4 | 347 | 680 |

(EUR millions)

Note

2017

2016

Economic result of the year

Economic result of the year

(3 818 )

(3 818 )

(3 073 )

(3 073 )

Operating activities

Operating activities

Capital increase — contributions (net)

Capital increase — contributions (net)

3 850

3 850

3 450

3 450

(Increase)/decrease in trust funds contributions

(Increase)/decrease in trust funds contributions

(66)

(66)

(64)

(64)

(Increase)/decrease in pre-financing

(Increase)/decrease in pre-financing

(319)

(319)

(120)

(120)

(Increase)/decrease in exchange receivables and

(Increase)/decrease in exchange receivables and

non-exchange recoverables

non-exchange recoverables

40

40

39

39

Increase/(decrease) in financial liabilities

Increase/(decrease) in financial liabilities

8

8

(4)

(4)

Increase/(decrease) in payables

Increase/(decrease) in payables

14

14

28

28

Increase/(decrease) in accrued charges and deferred income

Increase/(decrease) in accrued charges and deferred income

(42)

(42)

(80)

(80)

NET CASH FLOW

NET CASH FLOW

(333)

(333)

177

177

Net increase/(decrease) in cash and cash equivalents

Net increase/(decrease) in cash and cash equivalents

(333)

(333)

177

177

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the beginning of the year

2.4

2.4

680

680

504

504

Cash and cash equivalents at year-end

Cash and cash equivalents at year-end

2.4

2.4

347

347

680

680

EDF STATEMENT OF CHANGES IN NET ASSETS

EDF STATEMENT OF CHANGES IN NET ASSETS

| (EUR millions) |
| --- |
| | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Total Net Assets
  (C)+(D)+(E) |
| BALANCE AS AT 31.12.2015 | 73 464 | 34 590 | 38 873 | (40 146 ) | 2 252 | 980 |
| Capital increase — contributions | | (3 450 ) | 3 450 | | | 3 450 |
| Economic result of the year | | | — | (3 073 ) | | (3 073 ) |
| BALANCE AS AT 31.12.2016 | 73 464 | 31 140 | 42 323 | (43 219 ) | 2 252 | 1 357 |
| Capital increase — contributions | | (4 050 ) | 4 050 | | | 4 050 |
| Refund to Member States | (200) | | (200) | | | (200) |
| Economic result of the year | | | — | (3 818 ) | | (3 818 ) |
| BALANCE AS AT 31.12.2017 | 73 264 | 27 090 | 46 173 | (47 037 ) | 2 252 | 1 389 |

(EUR millions)

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Total Net Assets

(C)+(D)+(E)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

73 464

73 464

34 590

34 590

38 873

38 873

(40 146 )

(40 146 )

2 252

2 252

980

980

Capital increase — contributions

Capital increase — contributions

(3 450 )

(3 450 )

3 450

3 450

3 450

3 450

Economic result of the year

Economic result of the year

—

—

(3 073 )

(3 073 )

(3 073 )

(3 073 )

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

73 464

73 464

31 140

31 140

42 323

42 323

(43 219 )

(43 219 )

2 252

2 252

1 357

1 357

Capital increase — contributions

Capital increase — contributions

(4 050 )

(4 050 )

4 050

4 050

4 050

4 050

Refund to Member States

Refund to Member States

(200)

(200)

(200)

(200)

(200)

(200)

Economic result of the year

Economic result of the year

—

—

(3 818 )

(3 818 )

(3 818 )

(3 818 )

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

73 264

73 264

27 090

27 090

46 173

46 173

(47 037 )

(47 037 )

2 252

2 252

1 389

1 389

BALANCE SHEET BY EDF

BALANCE SHEET BY EDF

| (EUR millions) |
| --- |
| | | 31.12.2017 | 31.12.2016 |
| | Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF |
| NON-CURRENT ASSETS | | | | | | | | | |
| Pre-financing | 2.1 | — | 32 | 221 | 330 | — | 32 | 242 | 135 |
| Trust Fund contributions | 2.2 | — | 86 | — | 77 | — | — | — | 98 |
| | | — | 118 | 221 | 407 | — | 32 | 242 | 232 |
| CURRENT ASSETS | | | | | | | | | |
| Pre-financing | 2.1 | 1 | 40 | 867 | 610 | 1 | 50 | 909 | 412 |
| Exchange receivables and non-exchange recoverables | 2.3 | 0 | 64 | 17 | 11 | 1 | 71 | 59 | 2 |
| Liaison accounts | 2.3 | 189 | 88 | 3 555 | — | 196 | 424 | 3 424 | — |
| Cash and cash equivalents | 2.4 | — | — | — | 347 | — | — | — | 680 |
| | | 190 | 193 | 4 439 | 968 | 198 | 544 | 4 391 | 1 094 |
| TOTAL ASSETS
   (*1) | | 190 | 311 | 4 660 | 1 375 | 198 | 577 | 4 633 | 1 327 |
| NON-CURRENT LIABILITIES | | | | | | | | | |
| Provisions | 2.5 | — | — | — | (4) | — | — | — | (4) |
| Financial liabilities | 2.6 | — | — | (7) | (7) | — | — | (6) | — |
| | | — | — | (7) | (11) | — | — | (6) | (4) |
| CURRENT LIABILITIES | | | | | | | | | |
| Payables | 2.7 | (0) | (13) | (133) | (417) | (0) | (12) | (438) | (99) |
| Liaison accounts | 2.3 | — | — | — | (3 833 ) | — | — | — | (4 043 ) |
| Accrued charges and deferred income | 2.8 | (0) | (76) | (517) | (140) | (1) | (93) | (567) | (115) |
| | | (0) | (89) | (650) | (4 389 ) | (1) | (104) | (1 005 ) | (4 257 ) |
| TOTAL LIABILITIES
   (*1) | | (0) | (89) | (657) | (4 401 ) | (1) | (104) | (1 011 ) | (4 261 ) |
| NET ASSETS
   (*1) | | 190 | 222 | 4 003 | (3 025 ) | 197 | 472 | 3 622 | (2 934 ) |
| FUNDS & RESERVES | | | | | | | | | |
| Called fund capital — active EDFs | 2.9 | 12 164 | 10 773 | 20 960 | 2 277 | 12 164 | 10 973 | 19 187 | — |
| Called fund capital from closed EDFs carried forward | 2.9 | 627 | 1 625 | — | — | 627 | 1 625 | — | — |
| Called fund capital transfers between active EDFs | 2.9 | (2 503 ) | 2 177 | 120 | 206 | (2 496 ) | 2 214 | 247 | 35 |
| Economic result carried forward from previous years | | (10 098 ) | (14 339 ) | (15 812 ) | (2 969 ) | (10 100 ) | (14 248 ) | (14 415 ) | (1 382 ) |
| Economic result of the year | | 0 | (13) | (1 266 ) | (2 539 ) | 2 | (91) | (1 397 ) | (1 587 ) |
| NET ASSETS | | 190 | 222 | 4 003 | (3 025 ) | 197 | 472 | 3 622 | (2 934 ) |

(EUR millions)

31.12.2017

31.12.2016

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

Eighth EDF

Ninth EDF

10th EDF

11th EDF

NON-CURRENT ASSETS

NON-CURRENT ASSETS

Pre-financing

Pre-financing

2.1

2.1

—

32

32

221

221

330

330

—

32

32

242

242

135

135

Trust Fund contributions

Trust Fund contributions

2.2

2.2

—

86

86

—

77

77

—

—

—

—

—

—

98

98

—

118

118

221

221

407

407

—

32

32

242

242

232

232

CURRENT ASSETS

CURRENT ASSETS

Pre-financing

Pre-financing

2.1

2.1

1

1

40

40

867

867

610

610

1

1

50

50

909

909

412

412

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

2.3

2.3

0

0

64

64

17

17

11

11

1

1

71

71

59

59

2

2

Liaison accounts

Liaison accounts

2.3

2.3

189

189

88

88

3 555

3 555

—

—

196

196

424

424

3 424

3 424

—

—

Cash and cash equivalents

Cash and cash equivalents

2.4

2.4

—

—

—

347

347

—

—

—

—

680

680

190

190

193

193

4 439

4 439

968

968

198

198

544

544

4 391

4 391

1 094

1 094

TOTAL ASSETS
   (*1)

TOTAL ASSETS

*1

190

190

311

311

4 660

4 660

1 375

1 375

198

198

577

577

4 633

4 633

1 327

1 327

NON-CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Provisions

Provisions

2.5

2.5

—

—

—

—

—

—

(4)

(4)

—

—

—

—

—

—

(4)

(4)

Financial liabilities

Financial liabilities

2.6

2.6

—

—

(7)

(7)

(7)

(7)

—

—

(6)

(6)

—

—

—

—

(7)

(7)

(11)

(11)

—

—

(6)

(6)

(4)

(4)

CURRENT LIABILITIES

CURRENT LIABILITIES

Payables

Payables

2.7

2.7

(0)

(0)

(13)

(13)

(133)

(133)

(417)

(417)

(0)

(0)

(12)

(12)

(438)

(438)

(99)

(99)

Liaison accounts

Liaison accounts

2.3

2.3

—

—

—

—

—

—

(3 833 )

(3 833 )

—

—

—

—

—

—

(4 043 )

(4 043 )

Accrued charges and deferred income

Accrued charges and deferred income

2.8

2.8

(0)

(0)

(76)

(76)

(517)

(517)

(140)

(140)

(1)

(1)

(93)

(93)

(567)

(567)

(115)

(115)

(0)

(0)

(89)

(89)

(650)

(650)

(4 389 )

(4 389 )

(1)

(1)

(104)

(104)

(1 005 )

(1 005 )

(4 257 )

(4 257 )

TOTAL LIABILITIES
   (*1)

TOTAL LIABILITIES

*1

(0)

(0)

(89)

(89)

(657)

(657)

(4 401 )

(4 401 )

(1)

(1)

(104)

(104)

(1 011 )

(1 011 )

(4 261 )

(4 261 )

NET ASSETS
   (*1)

NET ASSETS

*1

190

190

222

222

4 003

4 003

(3 025 )

(3 025 )

197

197

472

472

3 622

3 622

(2 934 )

(2 934 )

FUNDS & RESERVES

FUNDS & RESERVES

Called fund capital — active EDFs

Called fund capital — active EDFs

2.9

2.9

12 164

12 164

10 773

10 773

20 960

20 960

2 277

2 277

12 164

12 164

10 973

10 973

19 187

19 187

—

Called fund capital from closed EDFs carried forward

Called fund capital from closed EDFs carried forward

2.9

2.9

627

627

1 625

1 625

—

—

627

627

1 625

1 625

—

—

Called fund capital transfers between active EDFs

Called fund capital transfers between active EDFs

2.9

2.9

(2 503 )

(2 503 )

2 177

2 177

120

120

206

206

(2 496 )

(2 496 )

2 214

2 214

247

247

35

35

Economic result carried forward from previous years

Economic result carried forward from previous years

(10 098 )

(10 098 )

(14 339 )

(14 339 )

(15 812 )

(15 812 )

(2 969 )

(2 969 )

(10 100 )

(10 100 )

(14 248 )

(14 248 )

(14 415 )

(14 415 )

(1 382 )

(1 382 )

Economic result of the year

Economic result of the year

0

0

(13)

(13)

(1 266 )

(1 266 )

(2 539 )

(2 539 )

2

2

(91)

(91)

(1 397 )

(1 397 )

(1 587 )

(1 587 )

NET ASSETS

NET ASSETS

190

190

222

222

4 003

4 003

(3 025 )

(3 025 )

197

197

472

472

3 622

3 622

(2 934 )

(2 934 )

STATEMENT OF FINANCIAL PERFORMANCE BY EDF

STATEMENT OF FINANCIAL PERFORMANCE BY EDF

| (EUR millions) |
| --- |
| | | 2017 | 2016 |
| Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF |
| REVENUE | | | | | | | | | |
| Revenue from non-exchange transactions | 3.1 | | | | | | | | |
| Recovery activities | | 0 | 5 | 49 | 7 | 1 | 5 | (2) | 4 |
| | | 0 | 5 | 49 | 7 | 1 | 5 | (2) | 4 |
| Revenue from exchange transactions | 3.2 | | | | | | | | |
| Financial revenue | | (0) | (1) | 4 | (0) | (0) | 2 | 2 | (1) |
| Other revenue | | 1 | 5 | 13 | 4 | 2 | 17 | 40 | 3 |
| | | 1 | 4 | 17 | 4 | 2 | 19 | 43 | 2 |
| Total revenue | | 1 | 9 | 66 | 11 | 3 | 23 | 41 | 7 |
| EXPENSES | | | | | | | | | |
| Aid instruments | 3.3 | (0) | (14) | (1 251 ) | (2 435 ) | 2 | (95) | (1 411 ) | (1 465 ) |
| Co-financing expenses | 3.4 | — | — | (42) | (1) | — | — | 15 | — |
| Finance costs | 3.6 | 1 | 1 | (10) | (0) | (0) | (0) | 4 | (0) |
| Other expenses | 3.7 | (2) | (9) | (29) | (114) | (3) | (19) | (46) | (129) |
| Total expenses | | (1) | (22) | (1 332 ) | (2 549 ) | (1) | (114) | (1 437 ) | (1 594 ) |
| ECONOMIC RESULT OF THE YEAR | | 0 | (13) | (1 266 ) | (2 539 ) | 2 | (91) | (1 397 ) | (1 587 ) |

(EUR millions)

2017

2016

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

Eighth EDF

Ninth EDF

10th EDF

11th EDF

REVENUE

REVENUE

Revenue from non-exchange transactions

Revenue from non-exchange transactions

3.1

3.1

Recovery activities

Recovery activities

0

0

5

5

49

49

7

7

1

1

5

5

(2)

(2)

4

4

0

0

5

5

49

49

7

7

1

1

5

5

(2)

(2)

4

4

Revenue from exchange transactions

Revenue from exchange transactions

3.2

3.2

Financial revenue

Financial revenue

(0)

(0)

(1)

(1)

4

4

(0)

(0)

(0)

(0)

2

2

2

2

(1)

(1)

Other revenue

Other revenue

1

1

5

5

13

13

4

4

2

2

17

17

40

40

3

3

1

1

4

4

17

17

4

4

2

2

19

19

43

43

2

2

Total revenue

Total revenue

1

1

9

9

66

66

11

11

3

3

23

23

41

41

7

7

EXPENSES

EXPENSES

Aid instruments

Aid instruments

3.3

3.3

(0)

(0)

(14)

(14)

(1 251 )

(1 251 )

(2 435 )

(2 435 )

2

2

(95)

(95)

(1 411 )

(1 411 )

(1 465 )

(1 465 )

Co-financing expenses

Co-financing expenses

3.4

3.4

—

—

—

—

(42)

(42)

(1)

(1)

—

—

—

—

15

15

—

—

Finance costs

Finance costs

3.6

3.6

1

1

1

1

(10)

(10)

(0)

(0)

(0)

(0)

(0)

(0)

4

4

(0)

(0)

Other expenses

Other expenses

3.7

3.7

(2)

(2)

(9)

(9)

(29)

(29)

(114)

(114)

(3)

(3)

(19)

(19)

(46)

(46)

(129)

(129)

Total expenses

Total expenses

(1)

(1)

(22)

(22)

(1 332 )

(1 332 )

(2 549 )

(2 549 )

(1)

(1)

(114)

(114)

(1 437 )

(1 437 )

(1 594 )

(1 594 )

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

0

0

(13)

(13)

(1 266 )

(1 266 )

(2 539 )

(2 539 )

2

2

(91)

(91)

(1 397 )

(1 397 )

(1 587 )

(1 587 )

STATEMENT OF CHANGES IN NET ASSETS BY EDF

STATEMENT OF CHANGES IN NET ASSETS BY EDF

| (EUR millions) |
| --- |
| Eighth EDF | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Called fund capital transfers between active EDFs
  (F) | Total Net Assets
  (C)+(D)+(E)+(F) |
| BALANCE AS AT 31.12.2015 | 12 164 | — | 12 164 | (10 100 ) | 627 | (2 476 ) | 214 |
| Transfers to/from the 10th EDF | | | — | | | (20) | (20) |
| Transfers to/from the 11th EDF | | | — | | | — | — |
| Economic result of the year | | | — | 2 | | | 2 |
| BALANCE AS AT 31.12.2016 | 12 164 | — | 12 164 | (10 098 ) | 627 | (2 496 ) | 197 |
| Transfers to/from the 10th EDF | | | — | | | (7) | (7) |
| Transfers to/from the 11th EDF | | | — | | | — | — |
| Economic result of the year | | | — | 0 | | — | 0 |
| BALANCE AS AT 31.12.2017 | 12 164 | — | 12 164 | (10 098 ) | 627 | (2 503 ) | 190 |

(EUR millions)

Eighth EDF

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Called fund capital transfers between active EDFs

(F)

Total Net Assets

(C)+(D)+(E)+(F)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

12 164

12 164

—

12 164

12 164

(10 100 )

(10 100 )

627

627

(2 476 )

(2 476 )

214

214

Transfers to/from the 10th EDF

Transfers to/from the 10th EDF

—

—

(20)

(20)

(20)

(20)

Transfers to/from the 11th EDF

Transfers to/from the 11th EDF

—

—

—

—

—

Economic result of the year

Economic result of the year

—

2

2

2

2

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

12 164

12 164

—

12 164

12 164

(10 098 )

(10 098 )

627

627

(2 496 )

(2 496 )

197

197

Transfers to/from the 10th EDF

Transfers to/from the 10th EDF

—

(7)

(7)

(7)

(7)

Transfers to/from the 11th EDF

Transfers to/from the 11th EDF

—

—

—

—

—

Economic result of the year

Economic result of the year

—

0

0

—

—

0

0

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

12 164

12 164

—

—

12 164

12 164

(10 098 )

(10 098 )

627

627

(2 503 )

(2 503 )

190

190

| (EUR millions) |
| --- |
| Ninth EDF | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Called fund capital transfers between active EDFs
  (F) | Total Net Assets
  (C)+(D)+(E)+(F) |
| BALANCE AS AT 31.12.2015 | 10 973 | — | 10 973 | (14 249 ) | 1 625 | 2 376 | 726 |
| Transfers to/from the 10th EDF | | | — | | | (163) | (163) |
| Economic result of the year | | | — | (91) | | | (91) |
| BALANCE AS AT 31.12.2016 | 10 973 | — | 10 973 | (14 339 ) | 1 625 | 2 214 | 472 |
| Refund to Member States | (200) | | (200) | | | | (200) |
| Transfers to/from the 10th EDF | | | — | | | (37) | (37) |
| Transfers to/from the 11th EDF | | | — | | | — | — |
| Economic result of the year | | | — | (13) | | — | (13) |
| BALANCE AS AT 31.12.2017 | 10 773 | — | 10 773 | (14 352 ) | 1 625 | 2 177 | 222 |

(EUR millions)

Ninth EDF

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Called fund capital transfers between active EDFs

(F)

Total Net Assets

(C)+(D)+(E)+(F)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

10 973

10 973

—

10 973

10 973

(14 249 )

(14 249 )

1 625

1 625

2 376

2 376

726

726

Transfers to/from the 10th EDF

Transfers to/from the 10th EDF

—

(163)

(163)

(163)

(163)

Economic result of the year

Economic result of the year

—

(91)

(91)

(91)

(91)

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

10 973

10 973

—

10 973

10 973

(14 339 )

(14 339 )

1 625

1 625

2 214

2 214

472

472

Refund to Member States

Refund to Member States

(200)

(200)

(200)

(200)

(200)

(200)

Transfers to/from the 10th EDF

Transfers to/from the 10th EDF

—

(37)

(37)

(37)

(37)

Transfers to/from the 11th EDF

Transfers to/from the 11th EDF

—

—

—

—

—

Economic result of the year

Economic result of the year

—

(13)

(13)

—

—

(13)

(13)

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

10 773

10 773

—

—

10 773

10 773

(14 352 )

(14 352 )

1 625

1 625

2 177

2 177

222

222

| (EUR millions) |
| --- |
| 10th EDF | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Called fund capital transfers between active EDFs
  (F) | Total Net Assets
  (C)+(D)+(E)+(F) |
| BALANCE AS AT 31.12.2015 | 20 960 | 5 223 | 15 737 | (14 415 ) | — | 35 | 1 357 |
| Capital increase — contributions | | (3 450 ) | 3 450 | | | | 3 450 |
| Transfers to/from the Eighth and Ninth EDF | | | — | | | 182 | 182 |
| Transfers to/from the 11th EDF | | | — | | | 30 | 30 |
| Economic result of the year | | | — | (1 397 ) | | | (1 397 ) |
| BALANCE AS AT 31.12.2016 | 20 960 | 1 773 | 19 187 | (15 812 ) | — | 247 | 3 622 |
| Capital increase — contributions | | (1 773 ) | 1 773 | | | — | 1 773 |
| Transfers to/from the Eighth and Ninth EDF | | | — | | | 44 | 44 |
| Transfers to/from the 11th EDF | | | — | | | (171) | (171) |
| Economic result of the year | | | — | (1 266 ) | | — | (1 266 ) |
| BALANCE AS AT 31.12.2017 | 20 960 | — | 20 960 | (17 078 ) | — | 120 | 4 003 |

(EUR millions)

10th EDF

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Called fund capital transfers between active EDFs

(F)

Total Net Assets

(C)+(D)+(E)+(F)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

20 960

20 960

5 223

5 223

15 737

15 737

(14 415 )

(14 415 )

—

35

35

1 357

1 357

Capital increase — contributions

Capital increase — contributions

(3 450 )

(3 450 )

3 450

3 450

3 450

3 450

Transfers to/from the Eighth and Ninth EDF

Transfers to/from the Eighth and Ninth EDF

—

182

182

182

182

Transfers to/from the 11th EDF

Transfers to/from the 11th EDF

—

30

30

30

30

Economic result of the year

Economic result of the year

—

—

(1 397 )

(1 397 )

(1 397 )

(1 397 )

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

20 960

20 960

1 773

1 773

19 187

19 187

(15 812 )

(15 812 )

—

247

247

3 622

3 622

Capital increase — contributions

Capital increase — contributions

(1 773 )

(1 773 )

1 773

1 773

—

—

1 773

1 773

Transfers to/from the Eighth and Ninth EDF

Transfers to/from the Eighth and Ninth EDF

—

44

44

44

44

Transfers to/from the 11th EDF

Transfers to/from the 11th EDF

—

—

(171)

(171)

(171)

(171)

Economic result of the year

Economic result of the year

—

—

(1 266 )

(1 266 )

—

—

(1 266 )

(1 266 )

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

20 960

20 960

—

—

20 960

20 960

(17 078 )

(17 078 )

—

—

120

120

4 003

4 003

| (EUR millions) |
| --- |
| 11th EDF | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Called fund capital transfers between active EDFs
  (F) | Total Net Assets
  (C)+(D)+(E)+(F) |
| BALANCE AS AT 31.12.2015 | 29 367 | 29 367 | — | (1 382 ) | — | 65 | (1 317 ) |
| Transfers to/from the Eighth, Ninth and 10th EDF | | | — | | — | (30) | (30) |
| Economic result of the year | | | — | (1 587 ) | | — | (1 587 ) |
| BALANCE AS AT 31.12.2016 | 29 367 | 29 367 | — | (2 969 ) | — | 35 | (2 934 ) |
| Capital increase — contributions | | (2 277 ) | 2 277 | | | 171 | 2 448 |
| Transfers to/from the Eighth, Ninth and 10th EDF | | | — | | | — | — |
| Economic result of the year | | | — | (2 539 ) | | — | (2 539 ) |
| BALANCE AS AT 31.12.2017 | 29 367 | 27 090 | 2 277 | (5 508 ) | — | 206 | (3 025 ) |

(EUR millions)

11th EDF

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Called fund capital transfers between active EDFs

(F)

Total Net Assets

(C)+(D)+(E)+(F)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

29 367

29 367

29 367

29 367

—

—

(1 382 )

(1 382 )

—

—

65

65

(1 317 )

(1 317 )

Transfers to/from the Eighth, Ninth and 10th EDF

Transfers to/from the Eighth, Ninth and 10th EDF

—

—

—

(30)

(30)

(30)

(30)

Economic result of the year

Economic result of the year

—

(1 587 )

(1 587 )

—

—

(1 587 )

(1 587 )

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

29 367

29 367

29 367

29 367

—

(2 969 )

(2 969 )

—

—

35

35

(2 934 )

(2 934 )

Capital increase — contributions

Capital increase — contributions

(2 277 )

(2 277 )

2 277

2 277

171

171

2 448

2 448

Transfers to/from the Eighth, Ninth and 10th EDF

Transfers to/from the Eighth, Ninth and 10th EDF

—

—

—

—

—

Economic result of the year

Economic result of the year

—

(2 539 )

(2 539 )

—

—

(2 539 )

(2 539 )

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

29 367

29 367

27 090

27 090

2 277

2 277

(5 508 )

(5 508 )

—

—

206

206

(3 025 )

(3 025 )

NOTES TO THE FINANCIAL STATEMENTS OF THE EDF (9)

NOTES TO THE FINANCIAL STATEMENTS OF THE EDF

9

1.   SIGNIFICANT ACCOUNTING POLICIES

SIGNIFICANT ACCOUNTING POLICIES

1.1.   ACCOUNTING PRINCIPLES

ACCOUNTING PRINCIPLES

The objective of financial statements is to provide information about the financial position, performance and cash flows of an entity that is useful to a wide range of users.

The overall considerations (or accounting principles) to be followed when preparing the financial statements are laid down in EU Accounting Rule 1 ‘Financial Statements’ and are the same as those described in IPSAS 1: fair presentation, accrual basis, going concern, consistency of presentation, materiality, aggregation, offsetting and comparative information. The qualitative characteristics of financial reporting are relevance, faithful representation (reliability), understandability, timeliness, comparability and verifiability.

1.2.   BASIS OF PREPARATION

BASIS OF PREPARATION

1.2.1.   Reporting period

Financial statements are presented annually. The accounting year begins on 1 January and ends on 31 December.

1.2.2.   Currency and basis for conversion

The annual accounts are presented in millions of euros, the euro being the EDF’s functional and reporting currency. Foreign currency transactions are translated into euros using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of foreign currency transactions and from the re-translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of financial performance. Different conversion methods apply to property, plant and equipment and intangible assets, which retain their value in euros at the date when they were purchased.

Year-end balances of monetary assets and liabilities denominated in foreign currencies are translated into euros on the basis of the European Central Bank (ECB) exchange rates applying on 31 December.

Euro exchange rates

Euro exchange rates

| Currency | 31.12.2017 | 31.12.2016 | Currency | 31.12.2017 | 31.12.2016 |
| --- | --- | --- | --- | --- | --- |
| BGN | 1,9558 | 1,9558 | PLN | 4,177 | 4,4103 |
| CZK | 25,5350 | 27,0210 | RON | 4,6585 | 4,5390 |
| DKK | 7,4449 | 7,4344 | SEK | 9,8438 | 9,5525 |
| GBP | 0,8872 | 0,8562 | CHF | 1,1702 | 1,0739 |
| HRK | 7,4400 | 7,5597 | JPY | 135,01 | 123,4000 |
| HUF | 310,3300 | 309,8300 | USD | 1,1993 | 1,0541 |

Currency

31.12.2017

31.12.2016

Currency

31.12.2017

31.12.2016

BGN

BGN

1,9558

1,9558

1,9558

1,9558

PLN

PLN

4,177

4,177

4,4103

4,4103

CZK

CZK

25,5350

25,5350

27,0210

27,0210

RON

RON

4,6585

4,6585

4,5390

4,5390

DKK

DKK

7,4449

7,4449

7,4344

7,4344

SEK

SEK

9,8438

9,8438

9,5525

9,5525

GBP

GBP

0,8872

0,8872

0,8562

0,8562

CHF

CHF

1,1702

1,1702

1,0739

1,0739

HRK

HRK

7,4400

7,4400

7,5597

7,5597

JPY

JPY

135,01

135,01

123,4000

123,4000

HUF

HUF

310,3300

310,3300

309,8300

309,8300

USD

USD

1,1993

1,1993

1,0541

1,0541

1.2.3.   Use of estimates

In accordance with IPSAS and generally accepted accounting principles, the financial statements necessarily include amounts based on estimates and assumptions by management based on the most reliable information available. Significant estimates include, but are not limited to; accrued and deferred revenue and charges, provisions, financial risk on accounts receivables, contingent assets and liabilities, and degree of impairment of assets. Actual results could differ from those estimates.

Reasonable estimates are essential part of the preparation of financial statements and do not undermine their reliability. An estimate may need revision if changes occur in the circumstances on which the estimate was based or as a result of new information or more experience. By its nature, the revision of an estimate does not relate to prior periods and is not the correction of an error. The effect of a change in accounting estimate shall be recognised in the surplus or deficit in the periods in which it becomes known.

1.3.   BALANCE SHEET

BALANCE SHEET

1.3.1.   Financial assets

The financial assets are classified in the following categories: financial assets at fair value through surplus or deficit; loans and receivables; held-to-maturity investments; and available for sale financial assets. The classification of the financial instruments is determined at initial recognition and re-evaluated at each balance sheet date.

(i)   Financial assets at fair value through surplus or deficit

Financial assets at fair value through surplus or deficit

A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by the entity. Derivatives are also categorised in this category. Assets in this category are classified as current assets if they are expected to be realised within 12 months of the balance sheet date. During this financial year, the entity did not hold any investments in this category.

(ii)   Loans and receivables

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the entity provides money, goods or services directly to a debtor with no intention of trading the receivable. They are included in non-current assets, except for maturities within 12 months of the balance sheet date. Loans and receivables include term deposits with the original maturity above three months.

(iii)   Held-to-maturity investments

Held-to-maturity investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the entity has the positive intention and ability to hold to maturity. During this financial year, the entity did not hold any investments in this category.

(iv)   Available for sale financial assets

Available for sale financial assets

Available for sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are classified as either current or non-current assets, depending on the period of time the entity expects to hold them, which is usually the maturity date.

Initial recognition and measurement

Initial recognition and measurement

Purchases and sales of financial assets at fair value through surplus or deficit, held-to-maturity and available for sale are recognised on trade date — the date on which the entity commits to purchase or sell the asset. Cash equivalents, loans and term deposits are recognised at settlement date. Financial instruments are initially recognised at fair value. For all financial assets not carried at fair value through surplus or deficit transaction costs are added to the fair value at initial recognition.

Financial instruments are derecognised when the rights to receive cash flows from the investments have expired or the entity has transferred substantially all risks and rewards of ownership to another party.

Subsequent measurement

Subsequent measurement

Financial assets at fair value through surplus or deficit are subsequently carried at fair value with gains and losses arising changes in the fair value being included in the statement of financial performance in the period in which they arise.

Loans and receivables and held-to maturity investments are carried at amortised cost using the effective interest method.

Available for sale financial assets are subsequently carried at fair value. Gains and losses arising from changes in the fair value are recognised in the fair value reserve. Interest on available for sale financial assets calculated using the effective interest method is recognised in the statement of financial performance.

The entity assesses at each balance sheet date whether there is objective evidence that a financial asset is impaired and whether an impairment loss should be recorded in the statement of financial performance.

1.3.2.   Pre-financing amounts

Pre-financing is a payment intended to provide the beneficiary with a cash advance, i.e. a float. It may be split into a number of payments over a period defined in the particular contract, decision, agreement or basic legal act. The float or advance is either used for the purpose for which it was provided during the period defined in the agreement or it is repaid. If the beneficiary does not incur eligible expenditure, he has the obligation to return the pre-financing advance to the entity. The amount of the pre-financing may be reduced (wholly or partially) by the acceptance of eligible costs (which are recognised as expenses).

Pre-financing is, on subsequent balance sheet dates, measured at the amount initially recognised on the balance sheet less eligible expenses (including estimated amounts where necessary) incurred during the period.

1.3.3.   Receivables and recoverables

As the EU accounting rules require a separate presentation of exchange and non-exchange transactions, for the purpose of drawing up the accounts, receivables are defined as stemming from exchange transactions and recoverables are defined as stemming from non-exchange transactions (when the entity receives value from another entity without directly giving approximately equal value in exchange).

Receivables from exchange transactions meet the definition of financial instruments and are thus classified as loans and receivables and measured accordingly (see 1.3.1 above).

Recoverables from non-exchange transactions are carried at original amount (adjusted for interests and penalties) less write-down for impairment. A write-down for impairment is established when there is objective evidence that the entity will not be able to collect all amounts due according to the original terms of the recoverables. The amount of the write-down is the difference between the asset’s carrying amount and the recoverable amount. The amount of the write-down is recognised in the statement of financial performance.

1.3.4.   Cash and cash equivalents

Cash and cash equivalents are financial instruments and include cash at hand, deposits held at call or at short notice with banks, and other short-term highly liquid investments with original maturities of three months or less.

1.3.5.   Provisions

Provisions are recognised when the entity has a present legal or constructive obligation towards third parties as a result of past events, it is more likely than not that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated. Provisions are not recognised for future operating losses. The amount of the provision is the best estimate of the expenditure expected to be required to settle the present obligation at the reporting date. Where the provision involves a large number of items, the obligation is estimated by weighting all possible outcomes by their associated probabilities (‘expected value’ method).

1.3.6.   Payables

Included under accounts payable are both amounts related to exchange transactions such as the purchase of goods and services and to non-exchange transactions e.g. to cost claims from beneficiaries, grants or other EU funding.

Where grants or other funding is provided to the beneficiaries, the cost claims are recorded as payables for the requested amount when the cost claim is received. Upon verification and acceptance of the eligible costs, the payables are valued at the accepted and eligible amount.

Payables arising from the purchase of goods and services are recognised at invoice reception for the original amount and corresponding expenses are entered in the accounts when the supplies or services are delivered and accepted by the entity.

1.3.7.   Accrued and deferred revenue and charges

Transactions and events are recognised in the financial statements in the period to which they relate. At year-end, if an invoice is not yet issued but the service has been rendered, the supplies have been delivered by the entity or a contractual agreement exists (e.g. by reference to a contract), an accrued revenue will be recognised in the financial statements. In addition, at year-end, if an invoice is issued but the services have not yet been rendered or the goods supplied have not yet been delivered, the revenue will be deferred and recognised in the subsequent accounting period.

Expenses are also accounted for in the period to which they relate. At the end of the accounting period, accrued expenses are recognised based on an estimated amount of the transfer obligation of the period. The calculation of accrued expenses is done in accordance with detailed operational and practical guidelines issued by the Accounting Officer which aim at ensuring that the financial statements provide a faithful representation of the economic and other phenomena they purport to represent. By analogy, if a payment has been made in advance for services or goods that have not yet been received, the expense will be deferred and recognised in the subsequent accounting period.

1.4.   STATEMENT OF FINANCIAL PERFORMANCE

STATEMENT OF FINANCIAL PERFORMANCE

1.4.1.   Revenue

Revenue comprises gross inflows of economic benefits or service potential received and receivable by the entity, which represents an increase in net assets, other than increases relating to contributions from owners.

Depending on the nature of the underlying transactions in the statement of financial performance it is distinguished between:

(i)   Revenue from non-exchange transactions

Revenue from non-exchange transactions

Revenue from non-exchange transactions are taxes and transfers because the transferor provides resources to the recipient entity without the recipient entity providing approximately equal value directly in exchange.

Transfers are inflows of future economic benefits or service potential from non-exchange transactions, other than taxes. The entity shall recognise an asset in respect of transfers when the entity controls the resources as a result of a past event (the transfer) and expects to receive future economic benefits or service potential from those resources, and when the fair value can be reliably measured. An inflow of resources from a non-exchange transaction recognised as an asset (i.e. cash) is also recognised as revenue, except to the extent that the entity has a present obligation in respect of that transfer (condition), which needs to be satisfied before the revenue can be recognised. Until the condition is met the revenue is deferred and recognised as a liability (pre-financing received).

(ii)   Revenue from exchange transactions

Revenue from exchange transactions

Revenue from the sale of goods and services is recognised when the significant risk and rewards of ownership of the goods are transferred to the purchaser. Revenue associated with a transaction involving the provision of services is recognised by reference to the stage of completion of the transaction at the reporting date.

1.4.2.   Expenses

Expenses are decreases in economic benefits or service potential during the reporting period in the form of outflows or consumption of assets or incurrence of liabilities that result in decreases in net assets/equity. They include both the expenses from exchange transactions and expenses from non-exchange transactions.

Expenses from exchange transactions arising from the purchase of goods and services are recognised when the supplies are delivered and accepted by the entity. They are valued at original invoice amount. Furthermore, at the balance sheet date expenses related to the service delivered during the period for which an invoice has not yet been received or accepted are recognised in the statement of financial performance.

Expenses from non-exchange transactions relate to transfers to beneficiaries and can be of three types: entitlements, transfers under agreement and discretionary grants, contributions and donations. Transfers are recognised as expenses in the period during which the events giving rise to the transfer occurred, as long as the nature of the transfer is allowed by regulation or an agreement has been signed authorising the transfer; any eligibility criteria have been met by the beneficiary; and a reasonable estimate of the amount can be made.

When a request for payment or cost claim is received and meets the recognition criteria, it is recognised as an expense for the eligible amount. At year-end, incurred eligible expenses due to the beneficiaries but not yet reported are estimated and recorded as accrued expense.

1.5.   CONTINGENT ASSETS AND LIABILITIES

CONTINGENT ASSETS AND LIABILITIES

1.5.1.   Contingent assets

A contingent asset is a possible asset that arises from past events and of which the existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity. A contingent asset is disclosed when an inflow of economic benefits or service potential is probable.

1.5.2.   Contingent liabilities

A contingent liability is a possible obligation that arises from past events and of which the existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the entity; or a present obligation that arises from past events but is not recognised because: it is not probable that an outflow of resources embodying economic benefits or service potential will be required to settle the obligation or, in the rare circumstances where the amount of the obligation cannot be measured with sufficient reliability.

1.6.   CO-FINANCING

CO-FINANCING

Co-financing contributions received fulfil the criteria of revenues from non-exchange transactions under condition and they are presented as payables to Member States, non-Member States and others. The EDF is required to use the contributions to deliver services to third parties or is otherwise required to return the assets (the contributions received). The outstanding payables relating to co-financing agreements represent the co-financing contributions received less the expenses incurred related to the project. The effect on net assets is nil.

Expenses relating to co-financing projects are recognised as they are incurred. The corresponding amount of contributions is recognised as operating revenue and the effect on economic result of the year is nil.

2.   NOTES TO THE BALANCE SHEET

NOTES TO THE BALANCE SHEET

ASSETS

ASSETS

2.1.   PRE-FINANCING

PRE-FINANCING

Many contracts provide for payments of advances before the commencement of works, delivery of supplies or the provision of services. Sometimes the payment schedules of contracts foresee payments on the basis of progress reports. Pre-financing is normally paid in the currency of the country or territory where the project is executed.

The timing of the recoverability or utilisation of pre-financing governs whether it is disclosed as a current or a non-current pre-financing asset. The utilisation is defined by the project’s underlying agreement. Any repayments or utilisation due within 12 months of the reporting date are disclosed as current pre-financing. As many of the EDF projects are long-term in nature, it is necessary that the related advances are available for more than one year. Thus some pre-financing amounts are shown as non-current assets.

| (EUR millions) |
| --- |
| | Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Non-current pre-financing | 2.1.1 | — | 32 | 221 | 330 | 582 | 409 |
| Current pre-financing | 2.1.2 | 1 | 40 | 867 | 610 | 1 518 | 1 372 |
| Total | | 1 | 72 | 1 088 | 939 | 2 100 | 1 781 |

(EUR millions)

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Non-current pre-financing

Non-current pre-financing

2.1.1

2.1.1

—

—

32

32

221

221

330

330

582

582

409

409

Current pre-financing

Current pre-financing

2.1.2

2.1.2

1

1

40

40

867

867

610

610

1 518

1 518

1 372

1 372

Total

Total

1

1

72

72

1 088

1 088

939

939

2 100

2 100

1 781

1 781

The increase in overall pre-financing is explained by the very high level of payments in 2017. The overall level of net payments in 2017 increased by 24 % compared to 2016 (see table 2.1 in the EDF Report on Financial Implementation). The level of ‘gross’ payments, i.e. payments without inflows from recovery orders, increased in 2017 by 25 %.

2.1

This increase is in line with the lifecycle of the EDF. The 11th EDF started in 2015 and 2017 was thus the third year of its existence. The 11th EDF has reached its maturity and peak with regards to the implementation of adopted actions. The number of open contracts in the 11th EDF increased from 1,3 k in 2016 to 1,6 k in 2017. In 2017 the value of the average contracted amount increased by 51 % compared to 2016. Therefore the level of net payments in the 11th EDF increased in 2017 by 52 % compared to 2016 (see table 2.1 in the EDF Report on Financial Implementation). As the ratio between payments relating to invoices and the pre-financing is stable (42 %-44 %), the increase in payments resulted in the higher level of pre-financing.

2.1

The increase in the overall pre-financing is in line with the decrease in cash and cash equivalents (see note 2.4).

2.4

2.1.1.   Non-current pre-financing

| (EUR millions) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| Direct Management | 159 | 71 |
| | Implemented by: |

(EUR millions)

31.12.2017

31.12.2016

Direct Management

Direct Management

159

159

71

71

Implemented by:

Implemented by:

| | | Commission |
| --- | --- | --- |

Commission

Commission

105

105

39

39

| | | EU executive agencies |
| --- | --- | --- |

EU executive agencies

EU executive agencies

6

6

4

4

| | | EU delegations |
| --- | --- | --- |

EU delegations

EU delegations

48

48

29

29

Indirect Management

Indirect Management

423

423

338

338

| | Implemented by: |
| --- | --- |

Implemented by:

Implemented by:

| | | EIB and EIF |
| --- | --- | --- |

EIB and EIF

EIB and EIF

166

166

180

180

| | | International organisations |
| --- | --- | --- |

International organisations

International organisations

189

189

87

87

| | | Private law bodies with a public service mission |
| --- | --- | --- |

Private law bodies with a public service mission

Private law bodies with a public service mission

11

11

25

25

| | | Public law bodies |
| --- | --- | --- |

Public law bodies

Public law bodies

37

37

13

13

| | | Third countries |
| --- | --- | --- |

Third countries

Third countries

20

20

34

34

Total

Total

582

582

409

409

2.1.2.   Current pre-financing

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Pre-financing (gross) | 2 | 158 | 2 722 | 2 406 | 5 288 | 4 745 |
| Cleared via cut-off | (1) | (118) | (1 855 ) | (1 796 ) | (3 770 ) | (3 373 ) |
| Total | 1 | 40 | 867 | 610 | 1 518 | 1 372 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Pre-financing (gross)

Pre-financing (gross)

2

2

158

158

2 722

2 722

2 406

2 406

5 288

5 288

4 745

4 745

Cleared via cut-off

Cleared via cut-off

(1)

(1)

(118)

(118)

(1 855 )

(1 855 )

(1 796 )

(1 796 )

(3 770 )

(3 770 )

(3 373 )

(3 373 )

Total

Total

1

1

40

40

867

867

610

610

1 518

1 518

1 372

1 372

| (EUR millions) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| Direct Management | 256 | 246 |
| | Implemented by: |

(EUR millions)

31.12.2017

31.12.2016

Direct Management

Direct Management

256

256

246

246

Implemented by:

Implemented by:

| | | Commission |
| --- | --- | --- |

Commission

Commission

86

86

115

115

| | | EU executive agencies |
| --- | --- | --- |

EU executive agencies

EU executive agencies

10

10

10

10

| | | EU delegations |
| --- | --- | --- |

EU delegations

EU delegations

161

161

122

122

Indirect Management

Indirect Management

1 262

1 262

1 125

1 125

| | Implemented by: |
| --- | --- |

Implemented by:

Implemented by:

| | | EIB and EIF |
| --- | --- | --- |

EIB and EIF

EIB and EIF

345

345

372

372

| | | International organisations |
| --- | --- | --- |

International organisations

International organisations

563

563

432

432

| | | Private law bodies with a public service mission |
| --- | --- | --- |

Private law bodies with a public service mission

Private law bodies with a public service mission

59

59

121

121

| | | Public law bodies |
| --- | --- | --- |

Public law bodies

Public law bodies

108

108

53

53

| | | Third countries |
| --- | --- | --- |

Third countries

Third countries

186

186

148

148

Total

Total

1 518

1 518

1 372

1 372

2.1.3.   Guarantees received in respect of pre-financing

Guarantees are held to secure pre-financing and are released when the final claim under a project is paid. At 31 December 2017 the guarantees received by the EDF in respect of pre-financing amounted to EUR 54 million (2016 EUR 53 million).

The majority of pre-financing is paid under the indirect management mode. In this case the beneficiary of the guarantee is not the EDF but the contracting authority. Even though the EDF is not the beneficiary, those guarantees secure its assets. In 2017 those guarantees amounted to EUR 577 million.

2.2.   TRUST FUND CONTRIBUTIONS

TRUST FUND CONTRIBUTIONS

This heading represents the amount paid as contributions to the Bêkou EU Trust Fund and EU Trust Fund for Africa. The contributions are net of the costs incurred by the trust funds and attributable to the EDF.

The trust fund contributions are implemented by the EDF under the direct management mode.

| (EUR millions) |
| --- |
| Trust Funds | Net contribution at 31.12.2016 | Contributions paid in 2017 | Allocation of TF’s net expenses 2017 | Net contribution at 31.12.2017 |
| Africa | 72 | 180 | (104) | 148 |
| Bêkou | 26 | — | (10) | 16 |
| Total | 98 | 180 | (114) | 163 |

(EUR millions)

Trust Funds

Net contribution at 31.12.2016

Contributions paid in 2017

Allocation of TF’s net expenses 2017

Net contribution at 31.12.2017

Africa

Africa

72

72

180

180

(104)

(104)

148

148

Bêkou

Bêkou

26

26

—

—

(10)

(10)

16

16

Total

Total

98

98

180

180

(114)

(114)

163

163

The activities of EUTF Africa increased in 2017 after the start-up year 2016. Its expenses in 2017 increased almost 5 times compared to 2016. Its payments doubled compared to the previous year.

2.3.   NON-EXCHANGE RECOVERABLES AND EXCHANGE RECEIVABLES

NON-EXCHANGE RECOVERABLES AND EXCHANGE RECEIVABLES

| (EUR millions) |
| --- |
| | Note | 31.12.2017 | 31.12.2016 |
| Recoverables from non-exchange transactions | 2.3.1 | 19 | 62 |
| Receivables from exchange transactions | 2.3.2 | 73 | 70 |
| Total | | 92 | 132 |

(EUR millions)

Note

31.12.2017

31.12.2016

Recoverables from non-exchange transactions

Recoverables from non-exchange transactions

2.3.1

2.3.1

19

19

62

62

Receivables from exchange transactions

Receivables from exchange transactions

2.3.2

2.3.2

73

73

70

70

Total

Total

92

92

132

132

2.3.1.   Recoverables from non-exchange transactions

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Member States | — | — | — | 7 | 7 | 40 |
| Customers | 2 | 7 | 9 | 1 | 19 | 18 |
| Public bodies | — | 10 | 8 | 2 | 20 | 23 |
| Third states | 0 | 1 | 4 | 0 | 6 | 4 |
| Write down | (2) | (16) | (15) | (1) | (34) | (25) |
| Liaison accounts with EU institutions | — | — | — | 2 | 2 | 2 |
| Total | 0 | 2 | 6 | 11 | 19 | 62 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Member States

Member States

—

—

—

—

—

—

7

7

7

7

40

40

Customers

Customers

2

2

7

7

9

9

1

1

19

19

18

18

Public bodies

Public bodies

—

—

10

10

8

8

2

2

20

20

23

23

Third states

Third states

0

0

1

1

4

4

0

0

6

6

4

4

Write down

Write down

(2)

(2)

(16)

(16)

(15)

(15)

(1)

(1)

(34)

(34)

(25)

(25)

Liaison accounts with EU institutions

Liaison accounts with EU institutions

—

—

—

—

—

—

2

2

2

2

2

2

Total

Total

0

0

2

2

6

6

11

11

19

19

62

62

The overall decrease of the recoverables from non-exchange transactions is mainly due to a decrease in recoverables from Member States. At 31 December 2016 this included ordinary contributions and amounts to be received as a consequence of Bridging Facility adjustments that were compensated against Member States contributions in 2017.

At 31 December 2017 Member States’ recoverables include the outstanding financial adjustment implemented against the first instalment of fund capital to be called in 2018 (see note 2.9.1).

2.9.1

| (EUR millions) |
| --- |
| Member States | 31.12.2017 |
| Czech Republic | 2 |
| Romania | 1 |
| Hungary | 1 |
| Ireland | 1 |
| Greece | 1 |
| Other | 1 |
| Total | 7 |

(EUR millions)

Member States

31.12.2017

Czech Republic

Czech Republic

2

2

Romania

Romania

1

1

Hungary

Hungary

1

1

Ireland

Ireland

1

1

Greece

Greece

1

1

Other

Other

1

1

Total

Total

7

7

2.3.2.   Receivables from exchange transactions

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Accrued income | — | 63 | 11 | — | 74 | 70 |
| Liaison accounts between EDFs | 189 | 88 | 3 555 | (3 833 ) | (0) | (0) |
| Total | 189 | 151 | 3 566 | (3 833 ) | 73 | 70 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Accrued income

Accrued income

—

—

63

63

11

11

—

—

74

74

70

70

Liaison accounts between EDFs

Liaison accounts between EDFs

189

189

88

88

3 555

3 555

(3 833 )

(3 833 )

(0)

(0)

(0)

(0)

Total

Total

189

189

151

151

3 566

3 566

(3 833 )

(3 833 )

73

73

70

70

Included under accrued income are primarily amounts of accrued interest on pre-financing related to projects (EUR 63 million) and on pre-financing related to the EU-Africa Trust Fund (EUR 11 million).

For efficiency reasons, the single treasury covering all the EDFs is allocated to the 11th EDF (10); this leads to operations between the various EDFs, which are balanced out in the liaison accounts between the various EDF balance sheets.

10

Liaison accounts are presented only in the individual EDFs. The total of liaison accounts is nil.

2.4.   CASH AND CASH EQUIVALENTS (11)

CASH AND CASH EQUIVALENTS

11

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Special accounts: | | | | | | |
| Financial institutions of Member States | — | — | — | 105 | 105 | 292 |
| Current accounts: | | | | | | |
| Commercial banks | — | — | — | 242 | 242 | 389 |
| Total | — | — | — | 347 | 347 | 680 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Special accounts:

Special accounts:

Financial institutions of Member States

Financial institutions of Member States

—

—

—

105

105

105

105

292

292

Current accounts:

Current accounts:

Commercial banks

Commercial banks

—

—

—

242

242

242

242

389

389

Total

Total

—

—

—

347

347

347

347

680

680

The overall decrease in cash and cash equivalents is mainly explained by the exceptionally high level of payments in 2017. The overall level of net payments in 2017 increased by 24 % compared to 2016 (see table 2.1 in the EDF Report on Financial Implementation). The level of ‘gross’ payments, i.e. payments without inflows from recovery orders, increased in 2017 by 25 %.

2.1

This increase of payments is in line with the lifecycle of the EDF. The 11th EDF started in 2015 and 2017 was the third year of its existence. The 11th EDF has reached its maturity and a peak in the implementation of adopted actions. The number of open contracts in the 11th EDF increased from 1,3 k in 2016 to 1,6 k in 2017. In 2017 the level of net payments in the 11th EDF increased by 52 % compared to 2016 (see table 2.1 in the EDF Report on Financial Implementation).

2.1

With the aim of improving the presentation in the 2017 annual accounts, the classification of financial institutions and banks has been reviewed. The comparative figures for 2016 are disclosed accordingly.

LIABILITIES

LIABILITIES

2.5.   PROVISIONS

PROVISIONS

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Provisions | — | — | — | 4 | 4 | 4 |
| Total | — | — | — | 4 | 4 | 4 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Provisions

Provisions

—

—

—

—

4

4

4

4

4

4

Total

Total

—

—

—

—

4

4

4

4

4

4

The provision is the best estimation of the probable amount to be paid by the EDF to finance the orderly closure of the Centre de Development (CDE), decided by the ACP-EU Committee of Ambassadors (Decision No 4/2014 of 23 October 2014).

The amount includes court cases (EUR 1,2 million) raised against the CDE and the remaining expected cost of the passive phase (e.g. residual administrative tasks, other residual litigations, archive, etc.) that started on 31 December 2016 (see note 4.2.2). No expenses regarding the passive phase have been incurred so far.

4.2.2

2.6.   FINANCIAL LIABILITIES

FINANCIAL LIABILITIES

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Co-financing — payables | — | — | 7 | 7 | 14 | 6 |
| Total | — | — | 7 | 7 | 14 | 6 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Co-financing — payables

Co-financing — payables

—

—

7

7

7

7

14

14

6

6

Total

Total

—

—

7

7

7

7

14

14

6

6

The change in the total co-financing liabilities is explained in the note 2.7.2.1.

2.7.2.1.

2.7.   PAYABLES

PAYABLES

| (EUR millions) |
| --- |
| | Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Current payables | 2.7.1 | 0 | 13 | 114 | 235 | 361 | 222 |
| Sundry payables | 2.7.2 | — | (0) | 20 | 182 | 202 | 327 |
| Total | | 0 | 13 | 133 | 417 | 563 | 549 |

(EUR millions)

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Current payables

Current payables

2.7.1

2.7.1

0

0

13

13

114

114

235

235

361

361

222

222

Sundry payables

Sundry payables

2.7.2

2.7.2

—

—

(0)

(0)

20

20

182

182

202

202

327

327

Total

Total

0

0

13

13

133

133

417

417

563

563

549

549

2.7.1.   Current payables

| (EUR millions) |
| --- |
| | | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Suppliers | | 0 | 9 | 85 | 40 | 133 | 98 |
| Member States | | — | — | 0 | 12 | 12 | 0 |
| Third states | | 0 | (0) | 15 | 131 | 146 | 91 |
| Public bodies | | — | 3 | 10 | 70 | 83 | 32 |
| Other current payables | | 0 | 1 | 4 | (18) | (13) | 1 |
| Total | | 0 | 13 | 114 | 235 | 361 | 222 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Suppliers

Suppliers

0

0

9

9

85

85

40

40

133

133

98

98

Member States

Member States

—

—

—

—

0

0

12

12

12

12

0

0

Third states

Third states

0

0

(0)

(0)

15

15

131

131

146

146

91

91

Public bodies

Public bodies

—

—

3

3

10

10

70

70

83

83

32

32

Other current payables

Other current payables

0

0

1

1

4

4

(18)

(18)

(13)

(13)

1

1

Total

Total

0

0

13

13

114

114

235

235

361

361

222

222

Payables include cost statements received by the EDF relating to its grant activity. They are recorded for the amount being claimed from the moment the demand is received. The same procedure applies to invoices and credit notes received under procurement activities. The cost claims concerned have been taken into account for the year-end (cut-off) procedures. Following the cut-off entries, estimated eligible amounts have been recognised in the statement of financial performance. Non-eligible amounts have been disclosed as other current payables.

Member States payables represent the outstanding financial adjustment to be deducted from the first instalment of fund capital to be called in 2018 (see note 2.9.1). This heading includes the amounts due to France (EUR 10 million), the Netherlands (EUR 1 million) and Austria (EUR 1 million).

2.9.1

2.7.2.   Sundry payables

| (EUR millions) |
| --- |
| | Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Co-financing payables | 2.7.2.1 | — | — | 22 | 6 | 28 | 64 |
| Deferred fund capital contributions | 2.7.2.2 | — | — | — | 173 | 173 | 261 |
| Other sundry payables | | — | — | — | 1 | 1 | 2 |
| Total | | — | — | 22 | 179 | 202 | 327 |

(EUR millions)

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Co-financing payables

Co-financing payables

2.7.2.1

2.7.2.1

—

—

—

—

22

22

6

6

28

28

64

64

Deferred fund capital contributions

Deferred fund capital contributions

2.7.2.2

2.7.2.2

—

—

—

—

—

—

173

173

173

173

261

261

Other sundry payables

Other sundry payables

—

—

—

—

—

—

1

1

1

1

2

2

Total

Total

—

—

—

—

22

22

179

179

202

202

327

327

2.7.2.1.   Co-financing payables

Co-financing payables

The breakdown of the non-current and current co-financing payables by Member State is summarised in the table below:

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Non-current co-financing | | | | | | |
| Belgium | — | — | 0 | 1 | 2 | 2 |
| Denmark | — | — | — | 0 | 0 | 0 |
| France | — | — | 4 | — | 4 | — |
| Germany | — | — | — | — | — | 0 |
| Sweden | — | — | 1 | 2 | 3 | 2 |
| United Kingdom | — | — | 1 | — | 1 | 1 |
| Canada | — | — | — | — | — | 0 |
| Australia | — | — | 0 | — | 0 | — |
| USAID | — | — | — | 4 | 4 | — |
| | — | — | 7 | 7 | 14 | 6 |
| Current co-financing | | | | | | |
| Belgium | — | — | 4 | (1) | 3 | 4 |
| Denmark | — | — | (1) | 1 | (0) | 1 |
| France | — | — | 12 | — | 12 | 37 |
| Germany | — | — | 0 | — | 0 | 1 |
| Netherlands | — | — | 0 | — | 0 | 1 |
| Spain | — | — | 1 | — | 1 | 3 |
| Sweden | — | — | 5 | 0 | 5 | 7 |
| United Kingdom | — | — | 1 | 3 | 4 | 11 |
| Canada | — | — | 0 | — | 0 | 0 |
| USAID | — | — | — | 2 | 2 | — |
| | — | — | 22 | 6 | 28 | 64 |
| Total | — | — | 29 | 13 | 42 | 70 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Non-current co-financing

Non-current co-financing

Belgium

Belgium

—

—

0

0

1

1

2

2

2

2

Denmark

Denmark

—

—

—

—

0

0

0

0

0

0

France

France

—

—

4

4

—

4

4

—

—

Germany

Germany

—

—

—

—

—

—

—

0

0

Sweden

Sweden

—

—

1

1

2

2

3

3

2

2

United Kingdom

United Kingdom

—

—

1

1

—

1

1

1

1

Canada

Canada

—

—

—

—

—

—

—

0

0

Australia

Australia

—

—

0

0

—

—

0

0

—

—

USAID

USAID

—

—

—

—

4

4

4

4

—

—

—

—

—

—

7

7

7

7

14

14

6

6

Current co-financing

Current co-financing

Belgium

Belgium

—

—

—

—

4

4

(1)

(1)

3

3

4

4

Denmark

Denmark

—

—

—

—

(1)

(1)

1

1

(0)

(0)

1

1

France

France

—

—

—

—

12

12

—

—

12

12

37

37

Germany

Germany

—

—

—

—

0

0

—

—

0

0

1

1

Netherlands

Netherlands

—

—

—

—

0

0

—

—

0

0

1

1

Spain

Spain

—

—

—

—

1

1

—

—

1

1

3

3

Sweden

Sweden

—

—

—

—

5

5

0

0

5

5

7

7

United Kingdom

United Kingdom

—

—

—

—

1

1

3

3

4

4

11

11

Canada

Canada

—

—

—

—

0

0

—

—

0

0

0

0

USAID

USAID

—

—

—

—

—

—

2

2

2

2

—

—

—

—

—

—

22

22

6

6

28

28

64

64

Total

Total

—

—

—

—

29

29

13

13

42

42

70

70

The total non-current and current co-financing payables decreased by EUR 28 million compared to the previous reporting period.

During 2017, new co-financing contributions were received from USAID (EUR 7 million), the United Kingdom (EUR 5 million) and Sweden (EUR 2 million).

The total co-financing payables were decreased by EUR 42 million in order to recognise revenue and expenses related to co-financed projects (see notes 3.1.1 and 3.4).

3.1.1

3.4

2.7.2.2.   Deferred fund capital contributions

Deferred fund capital contributions

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| United Kingdom | — | — | — | 170 | 170 | 252 |
| Lithuania | — | — | — | 2 | 2 | — |
| Hungary | — | — | — | — | — | 9 |
| Total | — | — | — | 173 | 173 | 261 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

United Kingdom

United Kingdom

—

—

—

—

—

—

170

170

170

170

252

252

Lithuania

Lithuania

—

—

—

—

—

—

2

2

2

2

—

—

Hungary

Hungary

—

—

—

—

—

—

—

—

—

—

9

9

Total

Total

—

—

—

—

—

—

173

173

173

173

261

261

This heading completely relates to Member States’ 2018 contributions paid in advance.

2.8.   ACCRUED CHARGES AND DEFERRED INCOME

ACCRUED CHARGES AND DEFERRED INCOME

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Accrued charges | 0 | 76 | 517 | 137 | 730 | 770 |
| Other accruals and deferrals | — | — | — | 3 | 3 | 6 |
| Total | 0 | 76 | 517 | 140 | 733 | 776 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Accrued charges

Accrued charges

0

0

76

76

517

517

137

137

730

730

770

770

Other accruals and deferrals

Other accruals and deferrals

—

—

—

—

—

—

3

3

3

3

6

6

Total

Total

0

0

76

76

517

517

140

140

733

733

776

776

Accrued charges comprise estimated operating expenses for on-going or ended contracts without validated cost claims where the 2017 eligible expenses incurred by beneficiaries of EDF were estimated using the best available information about the existing contracts. The portion of the estimated accrued charges which relates to pre-financing paid has been recorded as a reduction of the pre-financing amounts (see note 2.1).

2.1

NET ASSETS

NET ASSETS

2.9.   FUND CAPITAL

FUND CAPITAL

2.9.1.   Called fund capital — active EDFs

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | Total |
| Fund capital | 12 164 | 10 973 | 20 960 | 29 367 | 73 464 |
| Uncalled fund capital | — | — | (1 773 ) | (29 367 ) | (31 140 ) |
| Called fund capital 31.12.2016 | 12 164 | 10 973 | 19 187 | — | 42 323 |
| | | | | | |
| Fund capital | 12 164 | 10 773 | 20 960 | 29 367 | 73 264 |
| Uncalled fund capital | — | — | — | (27 090 ) | (27 090 ) |
| Called fund capital 31.12.2017 | 12 164 | 10 773 | 20 960 | 2 277 | 46 173 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

Total

Total

Fund capital

Fund capital

12 164

12 164

10 973

10 973

20 960

20 960

29 367

29 367

73 464

73 464

Uncalled fund capital

Uncalled fund capital

—

—

—

—

(1 773 )

(1 773 )

(29 367 )

(29 367 )

(31 140 )

(31 140 )

Called fund capital 31.12.2016

Called fund capital 31.12.2016

12 164

12 164

10 973

10 973

19 187

19 187

—

—

42 323

42 323

Fund capital

Fund capital

12 164

12 164

10 773

10 773

20 960

20 960

29 367

29 367

73 264

73 264

Uncalled fund capital

Uncalled fund capital

—

—

—

—

—

—

(27 090 )

(27 090 )

(27 090 )

(27 090 )

Called fund capital 31.12.2017

Called fund capital 31.12.2017

12 164

12 164

10 773

10 773

20 960

20 960

2 277

2 277

46 173

46 173

The fund capital represents the total amount of contributions from Member States for the relevant EDF fund as laid down in each of the Internal Agreements. The uncalled funds represent the initial allocation not yet called up from Member States.

The called fund capital represents the amount of the initial allocations which have been called up for transfer to the treasury accounts by the Member States (see note 2.9.2 below).

2.9.2

By means of Council Decision (EU) 2017/1206 (12) the Member States’ contributions set out in the Internal Agreements of the Eighth and Ninth EDF are to be reduced accordingly for an amount of EUR 200 million from funds decommitted under the Eighth and the Ninth EDF. As the funds decommitted under the Eighth EDF have been already almost entirely transferred to the other EDFs, EUR 200 million was deducted from the capital of the Ninth EDF.

12

Refunds arising from this reduction have been compensated against additional call for funds under the 11th EDF. It resulted in the financial adjustment. The financial adjustment can be implemented against the third instalment 2017 and/or the first instalment 2018. The outstanding financial adjustment has been disclosed either as receivables or payables from/to Member States (see notes 2.3.1 and 2.7.1)

2.3.1

2.7.1

2.9.2.   Called and uncalled fund capital by Member State

| (EUR millions) |
| --- |
| Contributions 10th EDF | % | Uncalled capital 31.12.2016 | Capital called in 2017 | Uncalled capital 31.12.2017 |
| Austria | 2,41 | 43 | (43) | — |
| Belgium | 3,53 | 63 | (63) | — |
| Bulgaria | 0,14 | 2 | (2) | — |
| Cyprus | 0,09 | 2 | (2) | — |
| Czech Republic | 0,51 | 9 | (9) | — |
| Denmark | 2,00 | 35 | (35) | — |
| Estonia | 0,05 | 1 | (1) | — |
| Finland | 1,47 | 26 | (26) | — |
| France | 19,55 | 347 | (347) | — |
| Germany | 20,50 | 364 | (364) | — |
| Greece | 1,47 | 26 | (26) | — |
| Hungary | 0,55 | 10 | (10) | — |
| Ireland | 0,91 | 16 | (16) | — |
| Italy | 12,86 | 228 | (228) | — |
| Latvia | 0,07 | 1 | (1) | — |
| Lithuania | 0,12 | 2 | (2) | — |
| Luxembourg | 0,27 | 5 | (5) | — |
| Malta | 0,03 | 1 | (1) | — |
| Netherlands | 4,85 | 86 | (86) | — |
| Poland | 1,30 | 23 | (23) | — |
| Portugal | 1,15 | 20 | (20) | — |
| Romania | 0,37 | 7 | (7) | — |
| Slovakia | 0,21 | 4 | (4) | — |
| Slovenia | 0,18 | 3 | (3) | — |
| Spain | 7,85 | 139 | (139) | — |
| Sweden | 2,74 | 49 | (49) | — |
| United Kingdom | 14,82 | 263 | (263) | — |
| Total | 100,00 | 1 773 | (1 773 ) | — |

(EUR millions)

Contributions 10th EDF

%

Uncalled capital 31.12.2016

Capital called in 2017

Uncalled capital 31.12.2017

Austria

Austria

2,41

2,41

43

43

(43)

(43)

—

—

Belgium

Belgium

3,53

3,53

63

63

(63)

(63)

—

—

Bulgaria

Bulgaria

0,14

0,14

2

2

(2)

(2)

—

—

Cyprus

Cyprus

0,09

0,09

2

2

(2)

(2)

—

—

Czech Republic

Czech Republic

0,51

0,51

9

9

(9)

(9)

—

—

Denmark

Denmark

2,00

2,00

35

35

(35)

(35)

—

—

Estonia

Estonia

0,05

0,05

1

1

(1)

(1)

—

—

Finland

Finland

1,47

1,47

26

26

(26)

(26)

—

—

France

France

19,55

19,55

347

347

(347)

(347)

—

—

Germany

Germany

20,50

20,50

364

364

(364)

(364)

—

—

Greece

Greece

1,47

1,47

26

26

(26)

(26)

—

—

Hungary

Hungary

0,55

0,55

10

10

(10)

(10)

—

—

Ireland

Ireland

0,91

0,91

16

16

(16)

(16)

—

—

Italy

Italy

12,86

12,86

228

228

(228)

(228)

—

—

Latvia

Latvia

0,07

0,07

1

1

(1)

(1)

—

—

Lithuania

Lithuania

0,12

0,12

2

2

(2)

(2)

—

—

Luxembourg

Luxembourg

0,27

0,27

5

5

(5)

(5)

—

—

Malta

Malta

0,03

0,03

1

1

(1)

(1)

—

—

Netherlands

Netherlands

4,85

4,85

86

86

(86)

(86)

—

—

Poland

Poland

1,30

1,30

23

23

(23)

(23)

—

—

Portugal

Portugal

1,15

1,15

20

20

(20)

(20)

—

—

Romania

Romania

0,37

0,37

7

7

(7)

(7)

—

—

Slovakia

Slovakia

0,21

0,21

4

4

(4)

(4)

—

—

Slovenia

Slovenia

0,18

0,18

3

3

(3)

(3)

—

—

Spain

Spain

7,85

7,85

139

139

(139)

(139)

—

—

Sweden

Sweden

2,74

2,74

49

49

(49)

(49)

—

—

United Kingdom

United Kingdom

14,82

14,82

263

263

(263)

(263)

—

—

Total

Total

100,00

100,00

1 773

1 773

(1 773 )

(1 773 )

—

—

| (EUR millions) |
| --- |
| Contributions 11th EDF | % | Uncalled capital 31.12.2016 | Capital called in 2017 | Uncalled capital 31.12.2017 |
| Austria | 2,40 | 704 | (55) | 650 |
| Belgium | 3,25 | 954 | (74) | 880 |
| Bulgaria | 0,22 | 64 | (5) | 59 |
| Croatia | 0,23 | 66 | (5) | 61 |
| Cyprus | 0,11 | 33 | (3) | 30 |
| Czech Republic | 0,80 | 234 | (18) | 216 |
| Denmark | 1,98 | 582 | (45) | 537 |
| Estonia | 0,09 | 25 | (2) | 23 |
| Finland | 1,51 | 443 | (34) | 409 |
| France | 17,81 | 5 231 | (406) | 4 826 |
| Germany | 20,58 | 6 044 | (469) | 5 575 |
| Greece | 1,51 | 443 | (34) | 408 |
| Hungary | 0,61 | 180 | (14) | 166 |
| Ireland | 0,94 | 276 | (21) | 255 |
| Italy | 12,53 | 3 680 | (285) | 3 394 |
| Latvia | 0,12 | 34 | (3) | 31 |
| Lithuania | 0,18 | 53 | (4) | 49 |
| Luxembourg | 0,26 | 75 | (6) | 69 |
| Malta | 0,04 | 11 | (1) | 10 |
| Netherlands | 4,78 | 1 403 | (109) | 1 294 |
| Poland | 2,01 | 589 | (46) | 544 |
| Portugal | 1,20 | 351 | (27) | 324 |
| Romania | 0,72 | 211 | (16) | 195 |
| Slovakia | 0,38 | 110 | (9) | 102 |
| Slovenia | 0,22 | 66 | (5) | 61 |
| Spain | 7,93 | 2 330 | (181) | 2 149 |
| Sweden | 2,94 | 863 | (67) | 796 |
| United Kingdom | 14,68 | 4 311 | (334) | 3 976 |
| Total | 100,00 | 29 367 | (2 277 ) | 27 090 |

(EUR millions)

Contributions 11th EDF

%

Uncalled capital 31.12.2016

Capital called in 2017

Uncalled capital 31.12.2017

Austria

Austria

2,40

2,40

704

704

(55)

(55)

650

650

Belgium

Belgium

3,25

3,25

954

954

(74)

(74)

880

880

Bulgaria

Bulgaria

0,22

0,22

64

64

(5)

(5)

59

59

Croatia

Croatia

0,23

0,23

66

66

(5)

(5)

61

61

Cyprus

Cyprus

0,11

0,11

33

33

(3)

(3)

30

30

Czech Republic

Czech Republic

0,80

0,80

234

234

(18)

(18)

216

216

Denmark

Denmark

1,98

1,98

582

582

(45)

(45)

537

537

Estonia

Estonia

0,09

0,09

25

25

(2)

(2)

23

23

Finland

Finland

1,51

1,51

443

443

(34)

(34)

409

409

France

France

17,81

17,81

5 231

5 231

(406)

(406)

4 826

4 826

Germany

Germany

20,58

20,58

6 044

6 044

(469)

(469)

5 575

5 575

Greece

Greece

1,51

1,51

443

443

(34)

(34)

408

408

Hungary

Hungary

0,61

0,61

180

180

(14)

(14)

166

166

Ireland

Ireland

0,94

0,94

276

276

(21)

(21)

255

255

Italy

Italy

12,53

12,53

3 680

3 680

(285)

(285)

3 394

3 394

Latvia

Latvia

0,12

0,12

34

34

(3)

(3)

31

31

Lithuania

Lithuania

0,18

0,18

53

53

(4)

(4)

49

49

Luxembourg

Luxembourg

0,26

0,26

75

75

(6)

(6)

69

69

Malta

Malta

0,04

0,04

11

11

(1)

(1)

10

10

Netherlands

Netherlands

4,78

4,78

1 403

1 403

(109)

(109)

1 294

1 294

Poland

Poland

2,01

2,01

589

589

(46)

(46)

544

544

Portugal

Portugal

1,20

1,20

351

351

(27)

(27)

324

324

Romania

Romania

0,72

0,72

211

211

(16)

(16)

195

195

Slovakia

Slovakia

0,38

0,38

110

110

(9)

(9)

102

102

Slovenia

Slovenia

0,22

0,22

66

66

(5)

(5)

61

61

Spain

Spain

7,93

7,93

2 330

2 330

(181)

(181)

2 149

2 149

Sweden

Sweden

2,94

2,94

863

863

(67)

(67)

796

796

United Kingdom

United Kingdom

14,68

14,68

4 311

4 311

(334)

(334)

3 976

3 976

Total

Total

100,00

100,00

29 367

29 367

(2 277 )

(2 277 )

27 090

27 090

In 2017 EUR 1 773 million has been called from the 10th EDF and EUR 2 277 million EUR from the 11th EDF. At 31 December 2017 the capital of the Eighth, Ninth and 10th EDF has been called up and received in its entirety.

2.9.3.   Called fund capital from closed EDFs carried forward

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Funds transferred from closed EDFs | 627 | 1 625 | — | — | 2 252 | 2 252 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Funds transferred from closed EDFs

Funds transferred from closed EDFs

627

627

1 625

1 625

—

—

—

—

2 252

2 252

2 252

2 252

This heading includes the resources transferred from closed EDFs to the Eighth and Ninth EDFs.

2.9.4.   Called fund capital transfers between active EDFs

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | Total |
| Balance at 31.12.2015 | (2 476 ) | 2 376 | 35 | 65 | — |
| Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs | (20) | (163) | 182 | — | — |
| Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs | — | — | (356) | 356 | — |
| Transfer from the 11th performance reserve to the African Peace Facility (10th EDF) | — | — | 386 | (386) | — |
| Balance at 31.12.2016 | (2 496 ) | 2 214 | 247 | 35 | — |
| Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs | (7) | (37) | 44 | — | — |
| Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs | — | — | (171) | 171 | — |
| Balance at 31.12.2017 | (2 503 ) | 2 177 | 120 | 206 | — |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

Total

Balance at 31.12.2015

Balance at 31.12.2015

(2 476 )

(2 476 )

2 376

2 376

35

35

65

65

—

—

Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs

Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs

(20)

(20)

(163)

(163)

182

182

—

—

—

—

Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs

Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs

—

—

—

—

(356)

(356)

356

356

—

—

Transfer from the 11th performance reserve to the African Peace Facility (10th EDF)

Transfer from the 11th performance reserve to the African Peace Facility (10th EDF)

—

—

—

—

386

386

(386)

(386)

—

—

Balance at 31.12.2016

Balance at 31.12.2016

(2 496 )

(2 496 )

2 214

2 214

247

247

35

35

—

—

Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs

Transfer of decommitted amounts to the 10th EDF performance reserve from previous EDFs

(7)

(7)

(37)

(37)

44

44

—

—

—

—

Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs

Transfer of decommitted amounts to the 11th EDF performance reserve from previous EDFs

—

—

—

—

(171)

(171)

171

171

—

—

Balance at 31.12.2017

Balance at 31.12.2017

(2 503 )

(2 503 )

2 177

2 177

120

120

206

206

—

—

This heading includes the resources transferred between the active EDFs.

Since the entry into force of the Cotonou Agreement, all the unspent funds in previous active EDFs are transferred to the most recently opened EDF after decommitment. The resources transferred from other EDFs increase the appropriations of the receiving fund and reduce the appropriations of the fund of origin. Funds transferred to the performance reserve of the 10th and 11th EDFs can be committed only under specific conditions set out in the Internal Agreements.

3.   NOTES TO THE STATEMENT OF FINANCIAL PERFORMANCE

NOTES TO THE STATEMENT OF FINANCIAL PERFORMANCE

REVENUE

REVENUE

| (EUR millions) |
| --- |
| | Note | 2017 | 2016 |
| Revenue from non-exchange transactions | 3.1 | 61 | 8 |
| Revenue from exchange transactions | 3.2 | 25 | 66 |
| Total | | 87 | 73 |

(EUR millions)

Note

2017

2016

Revenue from non-exchange transactions

Revenue from non-exchange transactions

3.1

3.1

61

61

8

8

Revenue from exchange transactions

Revenue from exchange transactions

3.2

3.2

25

25

66

66

Total

Total

87

87

73

73

3.1.   REVENUE FROM NON-EXCHANGE TRANSACTIONS

REVENUE FROM NON-EXCHANGE TRANSACTIONS

| (EUR millions) |
| --- |
| | Note | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Recovery of expenses | | 0 | 5 | 7 | 7 | 19 | 23 |
| Recovery of Stabex funds | | — | — | — | 0 | 0 | 1 |
| Co-financing revenue | 3.1.1 | — | — | 42 | 1 | 42 | (15) |
| Total | | 0 | 5 | 49 | 7 | 61 | 8 |

(EUR millions)

Note

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Recovery of expenses

Recovery of expenses

0

0

5

5

7

7

7

7

19

19

23

23

Recovery of Stabex funds

Recovery of Stabex funds

—

—

—

—

—

—

0

0

0

0

1

1

Co-financing revenue

Co-financing revenue

3.1.1

3.1.1

—

—

—

—

42

42

1

1

42

42

(15)

(15)

Total

Total

0

0

5

5

49

49

7

7

61

61

8

8

The non-exchange revenue can be broken down by management mode as follows:

| (EUR millions) |
| --- |
| | 2017 | 2016 |
| Direct Management | 5 | 6 |
| | Implemented by: |

(EUR millions)

2017

2016

Direct Management

Direct Management

5

5

6

6

Implemented by:

Implemented by:

| | | Commission |
| --- | --- | --- |

Commission

Commission

1

1

1

1

| | | EU delegations |
| --- | --- | --- |

EU delegations

EU delegations

4

4

5

5

Indirect Management

Indirect Management

56

56

2

2

| | Implemented by: |
| --- | --- |

Implemented by:

Implemented by:

| | | Third countries |
| --- | --- | --- |

Third countries

Third countries

55

55

(0)

(0)

| | | International organisations |
| --- | --- | --- |

International organisations

International organisations

2

2

2

2

| | | Public law bodies |
| --- | --- | --- |

Public law bodies

Public law bodies

0

0

0

0

| | | Private law bodies with a public service mission |
| --- | --- | --- |

Private law bodies with a public service mission

Private law bodies with a public service mission

(1)

(1)

0

0

Total

Total

61

61

8

8

3.1.1.   Co-financing revenue

The co-financing contributions received fulfil the criteria of revenues from non-exchange transactions under conditions and as such should not affect the statement of financial performance. The received contributions remain under liabilities (see note 2.7.2.1) until the conditions attached to the donated funds are met, i.e. eligible expenses are incurred (see note 3.4). The corresponding amount is then recognised as non-exchange revenue from co-financing. Consequently the effect on the economic result of the year is nil.

2.7.2.1

3.4

3.2.   REVENUE FROM EXCHANGE TRANSACTIONS

REVENUE FROM EXCHANGE TRANSACTIONS

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Financial revenue | (0) | (1) | 4 | (0) | 4 | 3 |
| Other revenue | 1 | 5 | 13 | 4 | 22 | 62 |
| Total | 1 | 4 | 17 | 4 | 25 | 66 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Financial revenue

Financial revenue

(0)

(0)

(1)

(1)

4

4

(0)

(0)

4

4

3

3

Other revenue

Other revenue

1

1

5

5

13

13

4

4

22

22

62

62

Total

Total

1

1

4

4

17

17

4

4

25

25

66

66

The financial revenue comprises interest from the Trust Fund and interest on pre-financing.

Other income entirely relates to the realised and unrealised foreign exchange gains.

EXPENSES

EXPENSES

3.3.   AID INSTRUMENTS

AID INSTRUMENTS

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Programmable aid | 1 | 3 | 805 | 1 341 | 2 150 | 1 751 |
| Macroeconomic support | — | 21 | — | — | 21 | 39 |
| Sectoral policy | (0) | (9) | — | — | (9) | 18 |
| Intra-ACP projects | — | 0 | 417 | 694 | 1 112 | 693 |
| Interest rate subsidies | — | — | — | — | — | (3) |
| Emergency aid | — | (1) | 26 | 264 | 289 | 398 |
| Other aid programmes related to former EDFs | — | (1) | — | — | (1) | 1 |
| Institutional support | — | — | 3 | 21 | 23 | 38 |
| Compensation export receipts | (0) | (1) | — | — | (1) | 0 |
| Contributions to Trust Funds | — | — | — | 114 | 114 | 35 |
| Total | 0 | 14 | 1 251 | 2 435 | 3 700 | 2 970 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Programmable aid

Programmable aid

1

1

3

3

805

805

1 341

1 341

2 150

2 150

1 751

1 751

Macroeconomic support

Macroeconomic support

—

—

21

21

—

—

—

—

21

21

39

39

Sectoral policy

Sectoral policy

(0)

(0)

(9)

(9)

—

—

—

—

(9)

(9)

18

18

Intra-ACP projects

Intra-ACP projects

—

—

0

0

417

417

694

694

1 112

1 112

693

693

Interest rate subsidies

Interest rate subsidies

—

—

—

—

—

—

—

—

—

—

(3)

(3)

Emergency aid

Emergency aid

—

—

(1)

(1)

26

26

264

264

289

289

398

398

Other aid programmes related to former EDFs

Other aid programmes related to former EDFs

—

—

(1)

(1)

—

—

—

—

(1)

(1)

1

1

Institutional support

Institutional support

—

—

—

—

3

3

21

21

23

23

38

38

Compensation export receipts

Compensation export receipts

(0)

(0)

(1)

(1)

—

—

—

—

(1)

(1)

0

0

Contributions to Trust Funds

Contributions to Trust Funds

—

—

—

—

—

—

114

114

114

114

35

35

Total

Total

0

0

14

14

1 251

1 251

2 435

2 435

3 700

3 700

2 970

2 970

The EDF operating expenditure covers various aid instruments and takes different forms, depending on how the money is paid out and managed.

The increase in overall expenses on aid instruments is in line with the lifecycle of the EDF. The 11th EDF started in 2015 and 2017 was thus the third year of its existence. The 11th EDF has reached its maturity and peak with regards to the implementation of adopted actions. The number of open contracts in the 11th EDF increased from 1,3 k in 2016 to 1,6 k in 2017. In 2017 the value of average contracted amount increased by 51 % compared to 2016.

The sectoral policy expenses were negative in 2017 due to reversal of an invoice that was incorrectly recorded in 2016.

3.4.   CO-FINANCING EXPENSES

CO-FINANCING EXPENSES

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Co-financing | — | — | 42 | 1 | 42 | (15) |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Co-financing

Co-financing

—

—

—

—

42

42

1

1

42

42

(15)

(15)

Included under this heading are the expenses incurred on co-financing projects in 2017. It should be noted that the expenses incurred include estimated amounts related to the cut-off exercise (and consequently reversals of the estimated amounts related to last year). Because the reversals of the 2015 estimated expenses (EUR 50 million) exceeded the expenses incurred in 2016 (EUR 35 million), the co-financing expenses were negative for 2016.

Corresponding revenue has been recognised in the statement of financial performance (see note 3.1.1).

3.1.1

3.5.   AID INSTRUMENTS AND CO-FINANCING EXPENSES BY MANAGEMENT TYPE

AID INSTRUMENTS AND CO-FINANCING EXPENSES BY MANAGEMENT TYPE

| (EUR millions) |
| --- |
| | 2017 | 2016 |
| Direct Management | 1 447 | 1 173 |
| | Implemented by: |

(EUR millions)

2017

2016

Direct Management

Direct Management

1 447

1 447

1 173

1 173

Implemented by:

Implemented by:

| | | Commission |
| --- | --- | --- |

Commission

Commission

122

122

140

140

| | | EU executive agencies |
| --- | --- | --- |

EU executive agencies

EU executive agencies

26

26

10

10

| | | Trust Funds |
| --- | --- | --- |

Trust Funds

Trust Funds

89

89

36

36

| | | EU delegations |
| --- | --- | --- |

EU delegations

EU delegations

1 209

1 209

987

987

Indirect Management

Indirect Management

2 295

2 295

1 781

1 781

| | Implemented by: |
| --- | --- |

Implemented by:

Implemented by:

| | | EIB and EIF |
| --- | --- | --- |

EIB and EIF

EIB and EIF

48

48

5

5

| | | International organisations |
| --- | --- | --- |

International organisations

International organisations

1 171

1 171

821

821

| | | Private law bodies with a public service mission |
| --- | --- | --- |

Private law bodies with a public service mission

Private law bodies with a public service mission

(20)

(20)

143

143

| | | Public law bodies |
| --- | --- | --- |

Public law bodies

Public law bodies

356

356

57

57

| | | Third countries |
| --- | --- | --- |

Third countries

Third countries

739

739

756

756

| | | Private law bodies implementing Public Private Partnership |
| --- | --- | --- |

Private law bodies implementing Public Private Partnership

Private law bodies implementing Public Private Partnership

0

0

(1)

(1)

Total

Total

3 742

3 742

2 954

2 954

3.6.   FINANCE COSTS

FINANCE COSTS

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Write-down of receivables | (1) | (1) | 10 | 1 | 9 | (4) |
| Other financial expenses | — | — | — | (1) | (1) | 0 |
| Total | (1) | (1) | 10 | 0 | 8 | (4) |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Write-down of receivables

Write-down of receivables

(1)

(1)

(1)

(1)

10

10

1

1

9

9

(4)

(4)

Other financial expenses

Other financial expenses

—

—

—

—

—

—

(1)

(1)

(1)

(1)

0

0

Total

Total

(1)

(1)

(1)

(1)

10

10

0

0

8

8

(4)

(4)

The heading write-down of receivables comprises the closure estimate of expenses on irrecoverable receivables. The 2017 estimated expenses reflect the increase of the overall write down on receivables from EUR 25 milllion to EUR 34 million (see note 2.3.1). Because the estimate also includes reversals of the the previous year’s estimation, the overall expenses were negative in 2016 (from EUR 29 million in 2015 to EUR 25 million in 2016).

2.3.1

3.7.   OTHER EXPENSES

OTHER EXPENSES

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 2017 | 2016 |
| Administrative and IT expenses | (0) | 0 | 1 | 106 | 107 | 129 |
| Provision for risks and charges | — | — | — | — | — | — |
| Realised losses on trade debtors | 1 | 1 | 1 | — | 3 | 0 |
| Exchange loses | 1 | 7 | 28 | 8 | 44 | 66 |
| Total | 2 | 9 | 29 | 114 | 154 | 196 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

2017

2017

2016

2016

Administrative and IT expenses

Administrative and IT expenses

(0)

(0)

0

0

1

1

106

106

107

107

129

129

Provision for risks and charges

Provision for risks and charges

—

—

—

—

—

—

—

—

—

—

—

—

Realised losses on trade debtors

Realised losses on trade debtors

1

1

1

1

1

1

—

—

3

3

0

0

Exchange loses

Exchange loses

1

1

7

7

28

28

8

8

44

44

66

66

Total

Total

2

2

9

9

29

29

114

114

154

154

196

196

This heading includes support expenditure, i.e. the administrative costs related to the programming and implementation of the EDFs. This includes expenses for preparation, follow-up, monitoring, and evaluation of projects as well as expenses for computer networks, technical assistance etc.

4.   CONTINGENT ASSETS & LIABILITIES AND OTHER SIGNIFICANT DISCLOSURES

CONTINGENT ASSETS & LIABILITIES AND OTHER SIGNIFICANT DISCLOSURES

4.1.   CONTINGENT ASSETS

CONTINGENT ASSETS

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Performance guarantees | — | 4 | 6 | 0 | 10 | 9 |
| Retention guarantees | — | 4 | 4 | — | 8 | 7 |
| Total | — | 8 | 10 | 0 | 18 | 16 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Performance guarantees

Performance guarantees

—

—

4

4

6

6

0

0

10

10

9

9

Retention guarantees

Retention guarantees

—

—

4

4

4

4

—

—

8

8

7

7

Total

Total

—

—

8

8

10

10

0

0

18

18

16

16

Performance guarantees are requested to ensure that beneficiaries of EDF funding meet the obligations of their contracts with the EDF.

Retention guarantees concern only works contracts. Typically 10 % of the interim payments to beneficiaries are withheld to ensure that the contractors fulfil their obligations. These withheld amounts are reflected as amounts payable. Subject to the approval of the contracting authority, the contractor may instead submit a retention guarantee which replaces the amounts withheld on interim payments. These received guarantees are disclosed as contingent assets.

For contracts managed under the indirect mode, the guarantees belong to a contracting authority other than the EDF and they are therefore not recorded by the EDF. In 2017 those guarantees amounted to EUR 644 million.

4.2.   OTHER SIGNIFICANT DISCLOSURES

OTHER SIGNIFICANT DISCLOSURES

4.2.1.   Outstanding commitments not yet expensed

The amount disclosed below is the budgetary RAL (‘Reste à Liquider’) less related amounts that have been included as expenses in the statement of financial performance. The budgetary RAL is an amount representing the commitments for which payments and/or de-commitments have not yet been made. This is the normal consequence of the existence of multi-annual programmes.

| (EUR millions) |
| --- |
| | Eighth EDF | Ninth EDF | 10th EDF | 11th EDF | 31.12.2017 | 31.12.2016 |
| Outstanding commitments not yet expensed | 0 | 88 | 1 659 | 6 760 | 8 508 | 6 746 |
| Total | 0 | 88 | 1 659 | 6 760 | 8 508 | 6 746 |

(EUR millions)

Eighth EDF

Ninth EDF

10th EDF

11th EDF

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Outstanding commitments not yet expensed

Outstanding commitments not yet expensed

0

0

88

88

1 659

1 659

6 760

6 760

8 508

8 508

6 746

6 746

Total

Total

0

0

88

88

1 659

1 659

6 760

6 760

8 508

8 508

6 746

6 746

At 31 December 2017 the budgetary RAL totalled EUR 9 745 million (2016: EUR 7 665 million).

4.2.2.   Centre for the Development of Enterprise

The ACP-EU Council of Ministers agreed in June 2014 ‘to proceed with the orderly closing of the CDE’, and at the same time ‘to ensure that the private sector support projects implemented by the CDE in ACP countries and regions are completed in full’. For this purpose, the ACP-EU Council of Ministers granted a delegation of powers to the ACP-EU Committee of Ambassadors to take this matter forward with a view to adopt the necessary decisions.

The ACP-EU Committee of Ambassadors authorised, by Decision No 4/2014 of 23/10/2014, the Executive Board of the CDE to take, with immediate effect, all appropriate measures to prepare for the closure of the CDE. As stipulated in article 2 of that Decision, the Executive Board was instructed to contract a Curator to prepare and implement a closure plan.

The Curator submitted to the CDE Executive Board at the end of June 2015 a definitive strategic plan, with a budget and work-plan, which reflected the outcome of the social dialogue. The budget of the definitive strategic plan, approved by the CDE Executive Board, was the basis for the Commission’s proposal for a Financing Decision that was adopted by the EC in 2015 for a total amount of EUR 18,2 million. Subsequent to the adoption of the above Financing Decision, a grant agreement was concluded in December 2015 between the CDE and the European Commission providing the necessary financing for the realization of CDE’s assets and settlement of its liabilities. This grant agreement started on 1 January 2016 and lasted until 31 December 2017.

4.2.3.   The United Kingdom’s withdrawal from the European Union

Background

Background

On 23 June 2016 a majority of the citizens of the United Kingdom who voted in the referendum on membership of the European Union voted to leave the EU. On 29 March 2017 the United Kingdom formally notified the European Council of its intention to leave the EU and the European Atomic Energy Community (Euratom).

With regard to the EDF

With regard to the EDF

On 19 March 2018 the Commission published a draft of the Withdrawal Agreement that outlined the progress made in the negotiations with the UK.

This draft Withdrawal Agreement states that the United Kingdom shall remain party to the EDF until the closure of the 11th EDF and all previous unclosed EDFs, and shall in this respect assume the same obligations as the Member States under the Internal Agreement by which it was set up, as well as the obligations resulting from previous EDFs until their closure. It may participate, as observer, without voting rights, in the EDF Committee.

The draft Withdrawal Agreement also states that, where the amounts from projects under the 10th EDF or from previous EDFs have not been committed or have been decommitted on the date of entry into force of this agreement, the United Kingdom’s share of those amounts shall not be reused. The same applies to the United Kingdom share of funds not committed or decommitted amounts under 11th EDF after 31 December 2020.

As at 31 December 2017, there is no financial impact to be reported in the EDF financial statement. The negotiations on the United Kingdom’s withdrawal from the European Union are still ongoing and, therefore, the final form of the agreement is not confirmed at this time.

5.   FINANCIAL RISK MANAGEMENT

FINANCIAL RISK MANAGEMENT

The following disclosures with regard to the financial risk management of the EDF relate to the treasury operations carried out by the Commission on behalf of the EDF in order to implement its resources.

5.1.   RISK MANAGEMENT POLICIES AND HEDGING ACTIVITIES

RISK MANAGEMENT POLICIES AND HEDGING ACTIVITIES

The rules and principles for the management of the treasury operations are laid down in the 11th EDF Financial Regulation and in the Internal Agreement.

As a result of the above regulation, the following main principles apply:

| — | The EDF contributions are paid by Member States in special accounts opened with the bank of issue of each Member State or the financial institution designated by it. The amounts of the contributions shall remain in those special accounts until the payments of EDF need to be made. |
| --- | --- |

—

The EDF contributions are paid by Member States in special accounts opened with the bank of issue of each Member State or the financial institution designated by it. The amounts of the contributions shall remain in those special accounts until the payments of EDF need to be made.

| — | EDF contributions are paid by Member States in EUR, while the EDF’s payments are denominated in EUR and in other currencies, including less well-known ones. |
| --- | --- |

—

EDF contributions are paid by Member States in EUR, while the EDF’s payments are denominated in EUR and in other currencies, including less well-known ones.

| — | Bank accounts opened by the Commission on behalf of the EDF may not be overdrawn. |
| --- | --- |

—

Bank accounts opened by the Commission on behalf of the EDF may not be overdrawn.

In addition to the special accounts, other bank accounts are opened by the Commission in the name of the EDF, with financial institutions (central banks and commercial banks), for the purpose of executing payments and receiving receipts other than the Member State contributions to the budget.

Treasury and payment operations are highly automated and rely on modern information systems. Specific procedures are applied to guarantee system security and to ensure segregation of duties in line with the Financial Regulation, the Commission’s internal control standards, and audit principles.

A written set of guidelines and procedures regulate the management of the treasury and payment operations with the objective of limiting operational and financial risk and ensuring an adequate level of control. They cover the different areas of operation, and compliance with the guidelines and procedures is checked regularly.

5.2.   CURRENCY RISK

CURRENCY RISK

Exposure of the EDF to currency risk at year end — net position

Exposure of the EDF to currency risk at year end — net position

| (EUR millions) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| USD | GBP | DKK | SEK | EUR | Other | Total | USD | GBP | DKK | SEK | EUR | Other | Total |
| Financial assets | | | | | | | | | | | | | | |
| Receivables and recoverables | 64 | — | — | — | 26 | 2 | 92 | 0 | — | — | — | 129 | 3 | 132 |
| Cash and cash equivalents | 4 | 0 | — | — | 344 | — | 347 | 2 | 0 | — | — | 678 | — | 680 |
| Total | 68 | 0 | — | — | 370 | 2 | 439 | 2 | 0 | — | — | 807 | 3 | 812 |
| Financial liabilities | | | | | | | | | | | | | | |
| Non-current financial liabilities | — | — | — | — | (14) | — | (14) | — | — | — | — | (6) | — | (6) |
| Payables | (0) | — | — | — | (533) | (30) | (563) | 0 | — | — | — | (495) | (54) | (549) |
| Total | (0) | — | — | — | (547) | (30) | (577) | 0 | — | — | — | (501) | (54) | (555) |
| Total | 68 | 0 | — | — | (177) | (28) | (138) | 2 | 0 | — | — | 306 | (51) | 257 |

(EUR millions)

31.12.2017

31.12.2016

USD

GBP

DKK

SEK

EUR

Other

Total

USD

GBP

DKK

SEK

EUR

Other

Total

Financial assets

Financial assets

Receivables and recoverables

Receivables and recoverables

64

64

—

—

—

—

—

—

26

26

2

2

92

92

0

0

—

—

—

—

—

—

129

129

3

3

132

132

Cash and cash equivalents

Cash and cash equivalents

4

4

0

0

—

—

—

—

344

344

—

—

347

347

2

2

0

0

—

—

—

—

678

678

—

—

680

680

Total

Total

68

68

0

0

—

—

—

—

370

370

2

2

439

439

2

2

0

0

—

—

—

—

807

807

3

3

812

812

Financial liabilities

Financial liabilities

Non-current financial liabilities

Non-current financial liabilities

—

—

—

—

—

—

—

—

(14)

(14)

—

—

(14)

(14)

—

—

—

—

—

—

—

—

(6)

(6)

—

—

(6)

(6)

Payables

Payables

(0)

(0)

—

—

—

—

—

—

(533)

(533)

(30)

(30)

(563)

(563)

0

0

—

—

—

—

—

—

(495)

(495)

(54)

(54)

(549)

(549)

Total

Total

(0)

(0)

—

—

—

—

—

—

(547)

(547)

(30)

(30)

(577)

(577)

0

0

—

—

—

—

—

—

(501)

(501)

(54)

(54)

(555)

(555)

Total

Total

68

68

0

0

—

—

—

—

(177)

(177)

(28)

(28)

(138)

(138)

2

2

0

0

—

—

—

—

306

306

(51)

(51)

257

257

All contributions are held in EUR, and other currencies are purchased only when they are needed for the execution of payments. As a result the EDF’s treasury operations are not exposed to currency risk.

5.3.   INTEREST RATE RISK

INTEREST RATE RISK

The EDF does not borrow money and as a consequence it is not exposed to interest rate risk.

Interest is accrued on balances it holds in its different banks accounts. The Commission, on behalf of the EDF, has therefore put in place measures to ensure that interest earned regularly reflect market interest rates as well as their possible fluctuation.

Contributions to the EDF budget are credited by each Member State to a special account opened with the financial institution designed by it. As the remuneration applied to some of these accounts may currently be negative, cash management procedures are in place to minimise balances kept on the accounts concerned. In addition, in accordance with Council Regulation (EU) 2016/888, any negative remuneration on these accounts is borne by the relevant Member State.

Overnight balances held in commercial bank accounts are remunerated on a daily basis. The remuneration of balances on such accounts is based on variable market rates to which a contractual margin (positive or negative) is applied. For most of the accounts the interest calculation is linked to a market reference rate and is adjusted to reflect any fluctuations of this rate. As a result no risk is taken by the EDF that its balances be remunerated at rates lower than market rates.

5.4.   CREDIT RISK (COUNTERPARTY RISK)

CREDIT RISK (COUNTERPARTY RISK)

Financial assets that are neither past due nor impaired:

Financial assets that are neither past due nor impaired:

| (EUR millions) |
| --- |
| | Total | Neither past due nor impaired | Past due but not impaired |
| < 1 year | 1-5 years | > 5 years |
| Exchange receivables and non-exchange recoverables | 92 | 92 | 0 | — | — |
| Total at 31.12.2017 | 92 | 92 | 0 | — | — |
| Exchange receivables and non-exchange recoverables | 132 | 93 | 36 | 4 | — |
| Total at 31.12.2016 | 132 | 93 | 36 | 4 | — |

(EUR millions)

Total

Neither past due nor impaired

Past due but not impaired

< 1 year

1-5 years

> 5 years

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

92

92

92

92

0

0

—

—

—

—

Total at 31.12.2017

Total at 31.12.2017

92

92

92

92

0

0

—

—

—

—

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

132

132

93

93

36

36

4

4

—

—

Total at 31.12.2016

Total at 31.12.2016

132

132

93

93

36

36

4

4

—

—

Financial assets by risk category:

Financial assets by risk category:

| (EUR millions) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| Receivables | Cash | Total | Receivables | Cash | Total |
| Counterparties with external credit rating | | | | | | |
| Prime and high grade | 3 | 103 | 106 | 34 | 284 | 318 |
| Upper medium grade | 0 | 240 | 240 | 3 | 371 | 374 |
| Lower medium grade | 3 | 4 | 7 | 2 | 16 | 18 |
| Non- investment grade | 1 | 0 | 2 | 1 | 9 | 10 |
| Total | 7 | 347 | 354 | 40 | 680 | 720 |
| Counterparties without external credit rating | | | | | | |
| Group 1 (debtors without defaults in the past) | 86 | 0 | 86 | 92 | 0 | 92 |
| Group 2 (debtors with defaults in the past) | — | — | — | — | — | — |
| Total | 86 | 0 | 86 | 92 | 0 | 92 |
| Total | 92 | 347 | 440 | 132 | 680 | 812 |

(EUR millions)

31.12.2017

31.12.2016

Receivables

Cash

Total

Receivables

Cash

Total

Counterparties with external credit rating

Counterparties with external credit rating

Prime and high grade

Prime and high grade

3

3

103

103

106

106

34

34

284

284

318

318

Upper medium grade

Upper medium grade

0

0

240

240

240

240

3

3

371

371

374

374

Lower medium grade

Lower medium grade

3

3

4

4

7

7

2

2

16

16

18

18

Non- investment grade

Non- investment grade

1

1

0

0

2

2

1

1

9

9

10

10

Total

Total

7

7

347

347

354

354

40

40

680

680

720

720

Counterparties without external credit rating

Counterparties without external credit rating

Group 1 (debtors without defaults in the past)

Group 1 (debtors without defaults in the past)

86

86

0

0

86

86

92

92

0

0

92

92

Group 2 (debtors with defaults in the past)

Group 2 (debtors with defaults in the past)

—

—

—

—

—

—

—

—

—

—

—

—

Total

Total

86

86

0

0

86

86

92

92

0

0

92

92

Total

Total

92

92

347

347

440

440

132

132

680

680

812

812

Funds in the categories non-investment grade and lower medium grade relate mainly to Member State contributions to the EDF paid to the special accounts opened by Member States in accordance with Article 22(3) of the EDF FR. According to this regulation the amount of such contributions must remain in those special accounts until the payments need to be made.

non-investment grade

lower medium grade

Most of the EDF’s treasury resources are kept, in accordance with the EDF FR, in the ‘special accounts’ opened by Member States for the payment of their contributions. The majority of such accounts are held with Member States’ treasuries or national central banks. These institutions carry the lowest counterparty risk for the EDF (exposure is with its Member States).

For the part of the EDF’s treasury resources kept with commercial banks in order to cover the execution of payments, replenishment of these accounts is executed on a just-in-time basis and is automatically managed by the Commission treasury’s cash management system. Minimum cash levels, proportional to the average amount of daily payments made from it, are kept on each account. As a consequence the amounts kept overnight on these accounts remain constantly at low levels which ensure the EDF’s risk exposure is limited.

In addition, specific guidelines are applied for the selection of commercial banks in order to further minimise counterparty risk to which the EDF is exposed.

All commercial banks are selected by call for tenders. The minimum short-term credit rating required for admission to the tendering procedures is Moody’s P-1 or equivalent (S&P A-1 or Fitch F1). A lower level may be required in specific and duly justified circumstances.

5.5.   LIQUIDITY RISK

LIQUIDITY RISK

Maturity analysis of financial liabilities by remaining contractual maturity

Maturity analysis of financial liabilities by remaining contractual maturity

| (EUR millions) |
| --- |
| | < 1 year | 1-5 years | > 5 years | Total |
| Financial liabilities | 563 | 13 | 1 | 577 |
| Total at 31.12.2017 | 563 | 13 | 1 | 577 |
| Financial liabilities | 549 | 6 | — | 555 |
| Total at 31.12.2016 | 549 | 6 | — | 555 |

(EUR millions)

< 1 year

1-5 years

> 5 years

Total

Financial liabilities

Financial liabilities

563

563

13

13

1

1

577

577

Total at 31.12.2017

Total at 31.12.2017

563

563

13

13

1

1

577

577

Financial liabilities

Financial liabilities

549

549

6

6

—

—

555

555

Total at 31.12.2016

Total at 31.12.2016

549

549

6

6

—

—

555

555

Budget principles applied to the EDF ensure that overall cash resources for the budgetary period are always sufficient for the execution of all related payments. Indeed the total Member States’ contributions equal the overall amount of payment appropriations for the relevant budgetary period.

Member States contributions to EDF, however, are paid in three instalments per year, while payments are subject to certain seasonality.

In order to ensure that treasury resources are always sufficient to cover the payments to be executed in any given month, information on the treasury situation is regularly exchanged between the Commission’ treasury and the relevant spending departments in order to ensure that payments executed in any given period do not exceed the available treasury resources.

In addition to the above, in the context of the EDF’s daily treasury operations, automated cash management tools ensure that sufficient liquidity is available on each of the EDF’s bank accounts, on a daily basis.

6.   RELATED PARTY DISCLOSURES

RELATED PARTY DISCLOSURES

The related parties of the EDF are Bêkou, Africa EU Trust Funds and the European Commission. Transactions between these entities take place as part of the normal operations of the EDF and as this is the case, no specific disclosure requirements are necessary for these transactions in accordance with the EU accounting rules.

The EDF has no separate management since it is managed by the Commission. The entitlements of the key management of the EU, including the Commission, have been disclosed in the Consolidated annual accounts of the European Union under heading 7.2 ‘Key management entitlements’.

7.   EVENTS AFTER THE BALANCE SHEET DATE

EVENTS AFTER THE BALANCE SHEET DATE

At the date of signing of these accounts, no material issues had come to the attention of or were reported to the Accounting Officer of the EDF that would require separate disclosure under this section. The annual accounts and related notes were prepared using the most recently available information and this is reflected in the information presented above.

8.   RECONCILIATION OF ECONOMIC RESULT AND BUDGET RESULT

RECONCILIATION OF ECONOMIC RESULT AND BUDGET RESULT

The economic result of the year is calculated on the basis of accrual accounting principles. The budget result is however based on cash accounting rules. As the economic result and the budget result both cover the same underlying operational transactions, it is a useful control to ensure that they are reconcilable. The table below shows this reconciliation, highlighting the key reconciling amounts, split between revenue and expenditure items.

| (EUR millions) |
| --- |
| | 2017 | 2016 |
| ECONOMIC RESULT OF THE YEAR | (3 818 ) | (3 073 ) |
| Revenue | | |
| Entitlements not affecting the budget result | (7) | (2) |
| Entitlements established in current year but not yet collected | (3) | (7) |
| Entitlements established in previous years and collected in current year | 29 | 16 |
| Net effect of pre-financing | 57 | 41 |
| Accrued revenue (net) | (62) | 8 |
| Other | (2) | (5) |
| Expenses | | |
| Expenses of the current year not yet paid | 19 | 22 |
| Expenses of previous years paid in the current year | (60) | (88) |
| Net effect of pre-financing | (685) | (459) |
| Accrued expenses (net) | 373 | 256 |
| BUDGET RESULT OF THE YEAR | (4 158 ) | (3 291 ) |

(EUR millions)

2017

2016

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

(3 818 )

(3 818 )

(3 073 )

(3 073 )

Revenue

Revenue

Entitlements not affecting the budget result

Entitlements not affecting the budget result

(7)

(7)

(2)

(2)

Entitlements established in current year but not yet collected

Entitlements established in current year but not yet collected

(3)

(3)

(7)

(7)

Entitlements established in previous years and collected in current year

Entitlements established in previous years and collected in current year

29

29

16

16

Net effect of pre-financing

Net effect of pre-financing

57

57

41

41

Accrued revenue (net)

Accrued revenue (net)

(62)

(62)

8

8

Other

Other

(2)

(2)

(5)

(5)

Expenses

Expenses

Expenses of the current year not yet paid

Expenses of the current year not yet paid

19

19

22

22

Expenses of previous years paid in the current year

Expenses of previous years paid in the current year

(60)

(60)

(88)

(88)

Net effect of pre-financing

Net effect of pre-financing

(685)

(685)

(459)

(459)

Accrued expenses (net)

Accrued expenses (net)

373

373

256

256

BUDGET RESULT OF THE YEAR

BUDGET RESULT OF THE YEAR

(4 158 )

(4 158 )

(3 291 )

(3 291 )

8.1.   RECONCILING ITEMS — REVENUE

RECONCILING ITEMS — REVENUE

The budgetary revenue of a financial year corresponds to the revenue collected from entitlements established in the course of the year and amounts collected from entitlements established in previous years.

The entitlements not affecting the budget result are recorded in the economic result but from a budgetary perspective cannot be considered as revenues as the cashed amount is transferred to reserves and cannot be recommitted without a Council decision.

The entitlements established in the current year but not yet collected are to be deducted from the economic result for reconciliation purposes as they do not form part of budgetary revenue. On the contrary, the entitlements established in previous years and collected in the current year must be added to the economic result for reconciliation purposes.

The net effect of pre-financing is the clearing of the recovered pre-financing amounts. This is a cash receipt which has no impact on the economic result.

The net accrued revenue mainly consists of accruals made for year-end cut-off purposes. Only the net effect, i.e. the accrued revenue of the current year less the reversal of accrued revenue of the previous year, is taken into consideration.

8.2.   RECONCILING ITEMS — EXPENDITURE

RECONCILING ITEMS — EXPENDITURE

Expenses of the current year not yet paid are to be added for reconciliation purposes as they are included in the economic result but do not form part of budgetary expenditure. On the contrary, the expenses of previous years paid in the current year must be deducted from the economic result for reconciliation purposes as they are part of the current year’s budgetary expenditure but have either no effect on the economic result or they decrease the expenses in case of corrections.

Expenses of the current year not yet paid

expenses of previous years paid in the current year

The cash receipts from payment cancellations do not affect the economic result whereas they impact the budget result.

payment cancellations

The net effect of pre-financing is the combination of the new pre-financing amounts paid in the current year (recognised as budgetary expenditure of the year) and the clearing of pre-financing paid in the current year or previous years through the acceptance of eligible costs. The latter represents an expense in accrual terms but not in the budgetary accounts since the payment of the initial pre-financing had already been considered as a budgetary expenditure at the time of its payment.

net effect of pre-financing

The net accrued expenses mainly consist of accruals made for year-end cut-off purposes, i.e. eligible expenses incurred by beneficiaries of EDF funds but not yet reported to the EDF. Only the net effect, i.e. the accrued expenses of the current year less the reversal of accrued expenses of the previous year, is taken into consideration.

net accrued expenses

FINANCIAL STATEMENTS OF THE EU TRUST FUNDS CONSOLIDATED IN EDF

FINANCIAL STATEMENTS OF THE EU TRUST FUNDS CONSOLIDATED IN EDF

ANNUAL ACCOUNTS OF THE BÊKOU EU TRUST FUND 2017 (13)

ANNUAL ACCOUNTS OF THE BÊKOU EU TRUST FUND 2017

13

BACKGROUND INFORMATION ON THE BÊKOU EU TRUST FUND

BACKGROUND INFORMATION ON THE BÊKOU EU TRUST FUND

General background on Union Trust Funds

General background on Union Trust Funds

A trust fund is a legal arrangement with a distinct financial structure that pools the funds of several donors to jointly finance an action on the basis of commonly agreed objectives and reporting formats.

In accordance with Article 187(1) of the Financial Regulation applicable to the general budget of the Union (EU FR) and Article 42 of the Financial Regulation applicable to the 11th European Development Fund (EDF FR), the Commission is authorised to create Union Trust Funds for external actions (EUTF). The EUTFs are created under an agreement concluded with other donors (at least one external donor) to respond to emergency, postemergency or thematic actions. The establishment of an EUTF needs to be justified namely by EU added value (its objectives can be better met at EU than at national level), and complimentarity (the trust fund should not duplicate already existing and similar instruments).

The European Commission submits the draft decision to establish an EUTF to the competent committee defined in the basic act governing the instrument that provides the EU’s financial contribution to the new Trust Fund. The consultation of the Committees ensures an adequate involvement of the Council in the establishment of any EUTF. The proposal for the revision of the Financial Regulation addresses the need for greater involvement of the European Parliament in the creation of EUTFs (Article 227(1)) and reporting on their activities (Article 244).

After the adoption of the establishment and financing decisions, the constitutive act of the EUTF is signed by the European Commission and the donors. The constitutive act details the main features of the EUTF, such as its specific objectives, the rules for the composition and the internal rules of its board, as well as the duration. EUTFs are created for a limited duration, which is, together with its objectives, defined by the constitutive act of each trust fund. In accordance with Article 187 of the EU FR, the EUTF has specific governance arrangements and contributions are placed outside the EU budget.

EUTFs offer a number of advantages: they are EU-led instruments, offering better coordination with EU Member States; better control of operations by the Union and other donors and enhanced EU visibility. Trust Funds benefit from fast decision-making processes and from their capacity to pool larger sums from different sources making them a flexible, proactive and adaptable tool.

EUTFs are managed by the Commission under the responsibility of the authorising officer by delegation who provides assurance on the use of the funds to the Commission and to third donors. The EUTF manager is the authorising officer by sub-delegation. As is the case for the European Development Fund, the accounting officer of a EUTF is the accounting officer of the Commission, who is responsible for laying down accounting procedures and chart of accounts common to all EUTFs.

The European Parliament and/or the Council may request the Commission to discontinue the appropriations for the Trust Fund or revise the constitutive act with a view to liquidate it.

Current EU Trust Funds

Current EU Trust Funds

To date, the Commission has set up four EUTFs:

| — | The BÊKOU EUTF, whose objective is to support all aspects of the Central African Republic’s exit from crisis and its reconstruction efforts. Established on 15 July 2014; |
| --- | --- |

—

The BÊKOU EUTF, whose objective is to support all aspects of the Central African Republic’s exit from crisis and its reconstruction efforts. Established on 15 July 2014;

BÊKOU EUTF

| — | The MADAD EUTF, a European Union Regional Trust Fund in response to the Syrian crisis. Established on 15 December 2014; |
| --- | --- |

—

The MADAD EUTF, a European Union Regional Trust Fund in response to the Syrian crisis. Established on 15 December 2014;

MADAD EUTF

| — | The AFRICA EUTF; a European Union Emergency Trust Fund for stability and addressing root causes of irregular migration and displaced persons in Africa. Established on 12 November 2015; |
| --- | --- |

—

The AFRICA EUTF; a European Union Emergency Trust Fund for stability and addressing root causes of irregular migration and displaced persons in Africa. Established on 12 November 2015;

AFRICA EUTF

| — | The COLOMBIA EUTF; to support the implementation of the peace agreement in the early recovery and stabilisation post conflict. Established on 12 December 2016. |
| --- | --- |

—

The COLOMBIA EUTF; to support the implementation of the peace agreement in the early recovery and stabilisation post conflict. Established on 12 December 2016.

COLOMBIA EUTF

Further information is available on the websites of individual EUTFs:

Bekou — http://ec.europa.eu/europeaid/bekou-trust-fund-introduction_en

Madad — http://ec.europa.eu/enlargement/neighbourhood/countries/syria/madad/index_en.htm

Africa — http://ec.europa.eu/europeaid/regions/africa/eu-emergency-trust-fund-africa_en

Colombia — http://ec.europa.eu/europeaid/eu-trust-fund-colombia_en

The Bêkou Trust Fund

The Bêkou Trust Fund

The first multi-donor EU Trust Fund called Bêkou, which means ‘hope’ in Sango, was established on 15 July 2014, by the Commission (represented by DGs DEVCO and ECHO, and the EEAS) and three of its Member States (Germany, France and the Netherlands), with the aim of promoting the stabilisation and reconstruction of the Central African Republic (CAR). It has been established for a maximum duration of 60 months. The trust fund is managed from Brussels.

The Trust Fund Board and the Operational Committee of the Bêkou EU Trust Fund are composed of representatives of the donors, of the Commission and observers.

The Board adopts and reviews the strategy of the EUTF. The Board shall meet at least once a year.

The Operational Committee examines, approves and supervises the implementation of the actions financed by the Fund. The Committee also approves the annual accounts and the annual reports on the activities financed by the Trust Fund.

Annual accounts of the Bêkou Trust Fund

Annual accounts of the Bêkou Trust Fund

According to Article 8 of the Agreement establishing the European Union Trust Fund for the Central African Republic, the ‘Bêkou EU Trust Fund’ and Article 11.2.1 of the Constitutive agreement, the annual accounts comprise two parts: (1) The annual financial report prepared by the EUTF manager and (2) The annual financial statements prepared by the Commission’s Accounting Officer, who is, based on the same article also the Accounting Officer of the trust fund.

According to Article 8 of the Constitutive agreement the financial statements shall be prepared in accordance with the accounting rules adopted by the Commission’s Accounting Officer (EU Accounting Rules, EAR) that are based on the International Public Sector Accounting Standards (IPSAS).

The annual accounts are subject to independent external audit and the final annual accounts are submitted by the EUTF manager and the Accounting Officer to the Operational Committee for approval (Article 8.3.4(c)).

Highlights of the year

Highlights of the year

The EU launched its first ever Trust Fund, named Bêkou, in July 2014 to help the Central Africa Republic and its population overcome the consequences of the crisis in ensuring access to basic services, in re-launching economic recovery and job creation, and in supporting reconciliation.

In 2017, the Bêkou EUTF adopted its operational strategy for the period 2017-2019, which focuses on: (i) rural development; (ii) support to the health sector; (iii) redeployment of public services and (iv) reconciliation. Priorities have been aligned with the ‘Plan national de Relèvement et de Consolidation de la Paix’ (RCPCA) and the National Indicative Programme (NIP) for the Central African Republic (signed in June 2017) and ownership by national authorities will be enhanced. In 2017, The Bêkou EUTF has adopted actions for a total amount of EUR 52,3 million in the sectors of rural resilience and job creation, health, support to the return of internally displaced people (IDPs) and refugees, light infrastructure, water and sanitation. The indicated amount covers newly adopted programmes, as well as several revisions of already adopted actions.

The Bêkou EUTF encompasses 15 programmes since its creation. In terms of contracts, the Bêkou EUTF signed 15 new contracts in 2017 for a total amount of nearly EUR 20 million, which contribute to the implementation of its programmes in the sectors of health, food security, gender empowerment and wildlife conservation. Moreover, amounts committed to some spending areas have increased to implement the adopted programme revisions; in particular, an increase of EUR 12 million for the spending area ‘Basic health care’.

Pledges by its contributors amounted to more than EUR 236 million by the end of 2017. This is an increase of EUR 63 million compared to year 2016. However, EUR 56 million out of these EUR 236 million remain to be certified.

Furthermore, more than EUR 18 million was paid on top of payments made during previous years; total disbursements have reached over EUR 61 million since the creation of Bêkou EUTF.

In the financial statements, the most important movements can be found in:

| — | Pre-financing: a decrease of kEUR 7 912 as less contracts have an open pre-financed amount; |
| --- | --- |

—

Pre-financing: a decrease of kEUR 7 912 as less contracts have an open pre-financed amount;

| — | Operating expenses: An increase of kEUR 12 486 illustrating the maturity of the Trust Fund and the increased activities in the fields of urban development and basic and primary health care. |
| --- | --- |

—

Operating expenses: An increase of kEUR 12 486 illustrating the maturity of the Trust Fund and the increased activities in the fields of urban development and basic and primary health care.

BALANCE SHEET

BALANCE SHEET

| (EUR ‘000) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| NON-CURRENT ASSETS | | |
| Pre-financing | 686 | 3 604 |
| | 686 | 3 604 |
| CURRENT ASSETS | | |
| Pre-financing | 7 465 | 12 458 |
| Exchange receivables and non-exchange recoverables | 877 | 1 455 |
| Cash and cash equivalents | 39 943 | 43 036 |
| | 48 285 | 56 949 |
| TOTAL ASSETS | 48 971 | 60 554 |
| NON-CURRENT LIABILITIES | | |
| Financial liabilities | (44 720 ) | (59 339 ) |
| | (44 720 ) | (59 339 ) |
| CURRENT LIABILITIES | | |
| Payables | (716) | (0) |
| Accrued charges and deferred revenue | (3 536 ) | (1 215 ) |
| | (4 252 ) | (1 215 ) |
| TOTAL LIABILITIES | (48 971 ) | (60 554 ) |
| NET ASSETS | — | — |
| FUNDS & RESERVES | | |
| Accumulated surplus | — | — |
| Economic result of the year | — | — |
| NET ASSETS | — | — |

(EUR ‘000)

31.12.2017

31.12.2016

NON-CURRENT ASSETS

NON-CURRENT ASSETS

Pre-financing

Pre-financing

686

686

3 604

3 604

686

686

3 604

3 604

CURRENT ASSETS

CURRENT ASSETS

Pre-financing

Pre-financing

7 465

7 465

12 458

12 458

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

877

877

1 455

1 455

Cash and cash equivalents

Cash and cash equivalents

39 943

39 943

43 036

43 036

48 285

48 285

56 949

56 949

TOTAL ASSETS

TOTAL ASSETS

48 971

48 971

60 554

60 554

NON-CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Financial liabilities

Financial liabilities

(44 720 )

(44 720 )

(59 339 )

(59 339 )

(44 720 )

(44 720 )

(59 339 )

(59 339 )

CURRENT LIABILITIES

CURRENT LIABILITIES

Payables

Payables

(716)

(716)

(0)

(0)

Accrued charges and deferred revenue

Accrued charges and deferred revenue

(3 536 )

(3 536 )

(1 215 )

(1 215 )

(4 252 )

(4 252 )

(1 215 )

(1 215 )

TOTAL LIABILITIES

TOTAL LIABILITIES

(48 971 )

(48 971 )

(60 554 )

(60 554 )

NET ASSETS

NET ASSETS

—

—

FUNDS & RESERVES

FUNDS & RESERVES

Accumulated surplus

Accumulated surplus

—

—

Economic result of the year

Economic result of the year

—

—

NET ASSETS

NET ASSETS

—

—

STATEMENT OF FINANCIAL PERFORMANCE

STATEMENT OF FINANCIAL PERFORMANCE

| (EUR ‘000) |
| --- |
| | 2017 | 2016 |
| REVENUE | | |
| Revenue from non-exchange transactions | | |
| Revenue from donations | 29 620 | 17 232 |
| | 29 620 | 17 232 |
| Revenue from exchange transactions | | |
| Financial revenue | 1 | 48 |
| | 1 | 48 |
| Total Revenue | 29 621 | 17 280 |
| EXPENSES | | |
| Operating expenses | (28 918 ) | (16 432 ) |
| Other expenses | (703) | (848) |
| Total Expenses | (29 621 ) | (17 280 ) |
| ECONOMIC RESULT OF THE YEAR | — | — |

(EUR ‘000)

2017

2016

REVENUE

REVENUE

Revenue from non-exchange transactions

Revenue from non-exchange transactions

Revenue from donations

Revenue from donations

29 620

29 620

17 232

17 232

29 620

29 620

17 232

17 232

Revenue from exchange transactions

Revenue from exchange transactions

Financial revenue

Financial revenue

1

1

48

48

1

1

48

48

Total Revenue

Total Revenue

29 621

29 621

17 280

17 280

EXPENSES

EXPENSES

Operating expenses

Operating expenses

(28 918 )

(28 918 )

(16 432 )

(16 432 )

Other expenses

Other expenses

(703)

(703)

(848)

(848)

Total Expenses

Total Expenses

(29 621 )

(29 621 )

(17 280 )

(17 280 )

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

—

—

—

—

CASH FLOW STATEMENT

CASH FLOW STATEMENT

| (EUR ‘000) |
| --- |
| | 2017 | 2016 |
| Economic result of the year | — | — |
| Operating activities | | |
| (Increase)/decrease in pre-financing | 7 912 | (6 569 ) |
| (Increase)/decrease in exchange receivables and non-exchange recoverables | 578 | (91) |
| Increase/(decrease) in financial liabilities | (14 620 ) | (3 786 ) |
| Increase/(decrease) in payables | 716 | 0 |
| Increase/(decrease) in accrued charges and deferred revenue | 2 321 | 1 021 |
| NET CASH FLOW | (3 092 ) | (9 425 ) |
| Net increase/(decrease) in cash and cash equivalents | (3 092 ) | (9 425 ) |
| Cash and cash equivalents at the beginning of the year | 43 036 | 52 461 |
| Cash and cash equivalents at year-end | 39 943 | 43 036 |

(EUR ‘000)

2017

2016

Economic result of the year

Economic result of the year

—

—

Operating activities

Operating activities

(Increase)/decrease in pre-financing

(Increase)/decrease in pre-financing

7 912

7 912

(6 569 )

(6 569 )

(Increase)/decrease in exchange receivables and non-exchange recoverables

(Increase)/decrease in exchange receivables and non-exchange recoverables

578

578

(91)

(91)

Increase/(decrease) in financial liabilities

Increase/(decrease) in financial liabilities

(14 620 )

(14 620 )

(3 786 )

(3 786 )

Increase/(decrease) in payables

Increase/(decrease) in payables

716

716

0

0

Increase/(decrease) in accrued charges and deferred revenue

Increase/(decrease) in accrued charges and deferred revenue

2 321

2 321

1 021

1 021

NET CASH FLOW

NET CASH FLOW

(3 092 )

(3 092 )

(9 425 )

(9 425 )

Net increase/(decrease) in cash and cash equivalents

Net increase/(decrease) in cash and cash equivalents

(3 092 )

(3 092 )

(9 425 )

(9 425 )

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the beginning of the year

43 036

43 036

52 461

52 461

Cash and cash equivalents at year-end

Cash and cash equivalents at year-end

39 943

39 943

43 036

43 036

STATEMENT OF CHANGES IN NET ASSETS

STATEMENT OF CHANGES IN NET ASSETS

| (EUR ‘000) |
| --- |
| | Accumulated surplus/
  (deficit) | Economic result of the year | Net assets |
| BALANCE AS AT 31.12.2016 | — | — | — |
| Economic result of the year | — | — | — |
| BALANCE AS AT 31.12.2017 | — | — | — |

(EUR ‘000)

Accumulated surplus/

(deficit)

Economic result of the year

Net assets

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

—

—

—

Economic result of the year

Economic result of the year

—

—

—

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

—

—

—

ANNUAL ACCOUNTS OF THE EUTF FOR AFRICA 2017 (14)

ANNUAL ACCOUNTS OF THE EUTF FOR AFRICA 2017

14

BACKGROUND INFORMATION ON THE EUTF FOR AFRICA

BACKGROUND INFORMATION ON THE EUTF FOR AFRICA

General background on Union Trust Funds

General background on Union Trust Funds

A trust fund is a legal arrangement with a distinct financial structure that pools the funds of several donors to jointly finance an action on the basis of commonly agreed objectives and reporting formats.

In accordance with Article 187(1) of the Financial Regulation applicable to the general budget of the Union (EU FR) and Article 42 of the Financial Regulation applicable to the 11th European Development Fund (EDF FR), the Commission is authorised to create Union Trust Funds for external actions (EUTF). The EUTFs are created under an agreement concluded with other donors (at least one external donor) to respond to emergency, postemergency or thematic actions. The establishment of an EUTF needs to be justified namely by EU added value (its objectives can be better met at EU than at national level), and complimentarity (the trust fund should not duplicate already existing and similar instruments).

The European Commission submits the draft decision to establish an EUTF to the competent committee defined in the basic act governing the instrument that provides the EU’s financial contribution to the new Trust Fund. The consultation of the Committees ensures an adequate involvement of the Council in the establishment of any EUTF. The proposal for the revision of the Financial Regulation addresses the need for greater involvement of the European Parliament in the creation of EUTFs (Article 227(1)) and reporting on their activities (Article 244).

After the adoption of the establishment and financing decisions, the constitutive act of the EUTF is signed by the European Commission and the donors. The constitutive act details the main features of the EUTF, such as its specific objectives, the rules for the composition and the internal rules of its board, as well as the duration. EUTFs are created for a limited duration, which is, together with its objectives, defined by the constitutive act of each trust fund. In accordance with Article 187 of the EU FR, the EUTF has specific governance arrangements and contributions are placed outside the EU budget.

EUTFs offer a number of advantages: they are EU-led instruments, offering better coordination with EU Member States; better control of operations by the Union and other donors and enhanced EU visibility. Trust Funds benefit from fast decision-making processes and from their capacity to pool larger sums from different sources making them a flexible, proactive and adaptable tool.

EUTFs are managed by the Commission under the responsibility of the authorising officer by delegation who provides assurance on the use of the funds to the Commission and to third donors. The EUTF manager is the authorising officer by sub-delegation. As is the case for the European Development Fund, the accounting officer of a EUTF is the accounting officer of the Commission, who is responsible for laying down accounting procedures and chart of accounts common to all EUTFs.

The European Parliament and/or the Council may request the Commission to discontinue the appropriations for the Trust Fund or revise the constitutive act with a view to liquidate it.

Current EU Trust Funds

Current EU Trust Funds

To date, the Commission has set up four EUTFs:

| — | The BÊKOU EUTF, whose objective is to support all aspects of the Central African Republic’s exit from crisis and its reconstruction efforts. Established on 15 July 2014; |
| --- | --- |

—

The BÊKOU EUTF, whose objective is to support all aspects of the Central African Republic’s exit from crisis and its reconstruction efforts. Established on 15 July 2014;

BÊKOU EUTF

| — | The MADAD EUTF, a European Union Regional Trust Fund in response to the Syrian crisis. Established on 15 December 2014; |
| --- | --- |

—

The MADAD EUTF, a European Union Regional Trust Fund in response to the Syrian crisis. Established on 15 December 2014;

MADAD EUTF

| — | The AFRICA EUTF; a European Union Emergency Trust Fund for stability and addressing root causes of irregular migration and displaced persons in Africa. Established on 12 November 2015; |
| --- | --- |

—

The AFRICA EUTF; a European Union Emergency Trust Fund for stability and addressing root causes of irregular migration and displaced persons in Africa. Established on 12 November 2015;

AFRICA EUTF

| — | The COLOMBIA EUTF; to support the implementation of the peace agreement in the early recovery and stabilisation post conflict. Established on 12 December 2016. |
| --- | --- |

—

The COLOMBIA EUTF; to support the implementation of the peace agreement in the early recovery and stabilisation post conflict. Established on 12 December 2016.

COLOMBIA EUTF

Further information is available on the websites of individual EUTFs:

Bekou — http://ec.europa.eu/europeaid/bekou-trust-fund-introduction_en

Madad — http://ec.europa.eu/enlargement/neighbourhood/countries/syria/madad/index_en.htm

Africa — http://ec.europa.eu/europeaid/regions/africa/eu-emergency-trust-fund-africa_en

Colombia — http://ec.europa.eu/europeaid/eu-trust-fund-colombia_en

The EUTF for Africa

The EUTF for Africa

European Union Emergency Trust Fund for stability and addressing root causes of irregular migration and displaced persons in Africa (‘EUTF for Africa’) was launched on 12 November 2015 during the Valletta Summit on Migration. The main objectives of this trust fund is to support all aspects of stability and contribute to better migration management as well as addressing the root causes of destabilisation, forced displacement and irregular migration, in particular by promoting resilience, economic and equal opportunities, security and development and addressing human rights abuses.

The trust fund operates in three main geographic areas, namely the Sahel region and Lake Chad area, the Horn of Africa and the North of Africa but also the neighbouring countries of the eligible countries may benefit, on a case by case basis, from the Trust fund’s project. The Trust Fund is established for a limited period, until 31 December 2020 in order to provide a short and medium-term response to the challenges of the regions. The trust fund is managed from Brussels.

The Trust Fund Board and the Operational Committee of the EUTF for Africa are composed of representatives of the donors and of the Commission, as well as representatives of non-contributing EU Member States, authorities of eligible countries’ and regional organisations as observers.

The Board establishes and reviews the strategy of the EUTF. The Board shall meet at least once a year.

The Operational Committee examines, approves and supervises the implementation of the actions financed by the Fund. The Committee also approves the annual accounts and the annual reports on the activities financed by the Trust Fund.

Annual accounts of the EUTF for Africa

Annual accounts of the EUTF for Africa

According to Article 7 of ‘The agreement establishing the European Union emergency trust fund for stability and addressing root causes of irregular migration and displaced persons in Africa and its internal rules’ (‘Constitutive agreement’) the annual accounts comprise two parts: (1) The annual financial report prepared by the EUTF manager and (2) The annual financial statements prepared by the EC Accounting Officer, who is, based on the same article also the Accounting Officer of the trust fund.

According to Article 8 of the Consitutive agreement the financial statements shall be prepared in accordance with the accounting rules adopted by the Commission’s Accounting Officer (EU Accounting Rules, EAR) that are based on the International Public Sector Accounting Standards (IPSAS).

The annual accounts are subject to independent external audit and the final annual accounts are submitted by the EUTF manager and the Accounting Officer to the Operational Committee for approval (Article 8.3.4(c)).

Highlights of the year

Highlights of the year

As of 31 December 2017, resources allocated to the EU Trust Fund for Africa amount to approximately EUR 3 330 million: over EUR 2 900 million from the European Development Fund (EDF) and EU financial instruments including DCI, ENI, HOME and ECHO funding, and EUR 378,8 million from EU Member States and other donors (Switzerland and Norway), of which EUR 340,9 million have been paid as of 31 December 2017.

In the course of 2017, resources from the EDF and the EU budget have increased by approximately EUR 525 million (EUR 245 million from EDF, EUR 230 million from DCI and EUR 50 million from DG HOME funding) which represents an increase of almost 22 %. But, more importantly, as a result of the strong call for additional funding by the Commission and the European Council, resources pledged by EU Member States and other donors have significantly increased in 2017 by EUR 226,4 million (148,5 %), going from EUR 152,4 million at the end of December 2016 to EUR 378,8 million at the end of 2017. This remarkable increase of EU Member States contributions has mainly focussed on the North of Africa region.

As of 31 December 2017, a total of 143 projects worth EUR 2 388 million have been approved for the Sahel and Lake Chad, the Horn of Africa and the North of Africa regions. Of the total amount approved, 210 contracts have been signed with implementing partners for an amount of over EUR 1 502 million (63 % of the approved funding). In 2017, the EUTF for Africa focused on deploying activities at country and regional level to address the compelling needs of African partner countries while further translating the Trust Fund’s strategic priorities into action. During the year, 40 new programmes have been approved in the three regions, bringing the total of approved programmes at the end of 2017 to 143 including three which operate across several regions. With EUR 900 million contracted, the implementation pace of the EUTF for Africa has significantly improved in 2017. An overall amount of EUR 1,5 billion has been signed with implementing partners since the inception of the Trust Fund. The Trust Fund for Africa has further intensified its efforts aimed at creating economic and employment opportunities, notably in the countries of origin, and to develop sustainable development opportunities in the countries of transit encouraging people to abandon activities linked to illegal migration. It is expected that in total over half a million people will have a job, receive vocational training or assistance to develop a business with the assistance of the EUTF for Africa. In 2017, the EUTF for Africa has offered protection and assistance to more than 13 000 migrants and the capacities of 1 500 governmental entities have been strengthened in order to fight against the smuggling of migrants and trafficking of human beings.

In the financial statements, the impact of this increased activity is most visible when looking at:

| — | Pre-financing: an increase of kEUR 134 662 (+ 117 %). This is comparable with the amounts contracted, which increased from EUR 600 million in 2016 to 1 502 million in 2017. |
| --- | --- |

—

Pre-financing: an increase of kEUR 134 662 (+ 117 %). This is comparable with the amounts contracted, which increased from EUR 600 million in 2016 to 1 502 million in 2017.

| — | Cash and cash equivalents: an increase of kEUR 147 691 due to the new funds received. |
| --- | --- |

—

Cash and cash equivalents: an increase of kEUR 147 691 due to the new funds received.

Expenses: An increase of kEUR 226 956 illustrating the increased activities of the Trust Fund after the start-up year 2016.

BALANCE SHEET

BALANCE SHEET

| (EUR ‘000) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| NON-CURRENT ASSETS | | |
| Pre-financing | 52 990 | 44 854 |
| | 52 990 | 44 854 |
| CURRENT ASSETS | | |
| Pre-financing | 197 258 | 70 731 |
| Exchange receivables and non-exchange recoverables | 3 020 | 9 476 |
| Cash and cash equivalents | 162 571 | 14 879 |
| | 362 849 | 95 086 |
| TOTAL ASSETS | 415 838 | 139 941 |
| NON-CURRENT LIABILITIES | | |
| Financial liabilities | (396 713 ) | (138 502 ) |
| | (396 713 ) | (138 502 ) |
| CURRENT LIABILITIES | | |
| Payables | (526) | (702) |
| Accrued charges and deferred revenue | (18 600 ) | (736) |
| | (19 126 ) | (1 439 ) |
| TOTAL LIABILITIES | (415 838 ) | (139 941 ) |
| NET ASSETS | — | — |
| FUNDS & RESERVES | | |
| Accumulated surplus | — | — |
| Economic result of the year | — | — |
| NET ASSETS | — | — |

(EUR ‘000)

31.12.2017

31.12.2016

NON-CURRENT ASSETS

NON-CURRENT ASSETS

Pre-financing

Pre-financing

52 990

52 990

44 854

44 854

52 990

52 990

44 854

44 854

CURRENT ASSETS

CURRENT ASSETS

Pre-financing

Pre-financing

197 258

197 258

70 731

70 731

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

3 020

3 020

9 476

9 476

Cash and cash equivalents

Cash and cash equivalents

162 571

162 571

14 879

14 879

362 849

362 849

95 086

95 086

TOTAL ASSETS

TOTAL ASSETS

415 838

415 838

139 941

139 941

NON-CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Financial liabilities

Financial liabilities

(396 713 )

(396 713 )

(138 502 )

(138 502 )

(396 713 )

(396 713 )

(138 502 )

(138 502 )

CURRENT LIABILITIES

CURRENT LIABILITIES

Payables

Payables

(526)

(526)

(702)

(702)

Accrued charges and deferred revenue

Accrued charges and deferred revenue

(18 600 )

(18 600 )

(736)

(736)

(19 126 )

(19 126 )

(1 439 )

(1 439 )

TOTAL LIABILITIES

TOTAL LIABILITIES

(415 838 )

(415 838 )

(139 941 )

(139 941 )

NET ASSETS

NET ASSETS

—

—

FUNDS & RESERVES

FUNDS & RESERVES

Accumulated surplus

Accumulated surplus

—

—

Economic result of the year

Economic result of the year

—

—

NET ASSETS

NET ASSETS

—

—

STATEMENT OF FINANCIAL PERFORMANCE

STATEMENT OF FINANCIAL PERFORMANCE

| (EUR ‘000) |
| --- |
| | 2017 | 2016 |
| REVENUE | | |
| Revenue from non-exchange transactions | | |
| Revenue from donations | 279 027 | 52 246 |
| | 279 027 | 52 246 |
| Revenue from exchange transactions | | |
| Financial revenue | 2 | 54 |
| Other revenue | 270 | 43 |
| | 271 | 97 |
| Total Revenue | 279 299 | 52 343 |
| EXPENSES | | |
| Operating expenses | (271 669 ) | (49 042 ) |
| Other expenses | (7 630 ) | (3 301 ) |
| Total expenses | (279 299 ) | (52 343 ) |
| ECONOMIC RESULT OF THE YEAR | — | — |

(EUR ‘000)

2017

2016

REVENUE

REVENUE

Revenue from non-exchange transactions

Revenue from non-exchange transactions

Revenue from donations

Revenue from donations

279 027

279 027

52 246

52 246

279 027

279 027

52 246

52 246

Revenue from exchange transactions

Revenue from exchange transactions

Financial revenue

Financial revenue

2

2

54

54

Other revenue

Other revenue

270

270

43

43

271

271

97

97

Total Revenue

Total Revenue

279 299

279 299

52 343

52 343

EXPENSES

EXPENSES

Operating expenses

Operating expenses

(271 669 )

(271 669 )

(49 042 )

(49 042 )

Other expenses

Other expenses

(7 630 )

(7 630 )

(3 301 )

(3 301 )

Total expenses

Total expenses

(279 299 )

(279 299 )

(52 343 )

(52 343 )

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

—

—

—

—

CASH FLOW STATEMENT

CASH FLOW STATEMENT

| (EUR ‘000) |
| --- |
| | 2017 | 2016 |
| Economic result of the year | — | — |
| Operating activities | | |
| (Increase)/decrease in pre-financing | (134 662 ) | (115 585 ) |
| (Increase)/decrease in exchange receivables and non-exchange recoverables | 6 456 | (9 476 ) |
| Increase/(decrease) in financial liabilities | 258 211 | 105 860 |
| Increase/(decrease) in payables | (177) | 702 |
| Increase/(decrease) in accrued charges and deferred revenue | 17 864 | 736 |
| NET CASH FLOW | 147 691 | (17 763 ) |
| Net increase/(decrease) in cash and cash equivalents | 147 691 | (17 763 ) |
| Cash and cash equivalents at the beginning of the year | 14 879 | 32 642 |
| Cash and cash equivalents at year-end | 162 571 | 14 879 |

(EUR ‘000)

2017

2016

Economic result of the year

Economic result of the year

—

—

Operating activities

Operating activities

(Increase)/decrease in pre-financing

(Increase)/decrease in pre-financing

(134 662 )

(134 662 )

(115 585 )

(115 585 )

(Increase)/decrease in exchange receivables and non-exchange recoverables

(Increase)/decrease in exchange receivables and non-exchange recoverables

6 456

6 456

(9 476 )

(9 476 )

Increase/(decrease) in financial liabilities

Increase/(decrease) in financial liabilities

258 211

258 211

105 860

105 860

Increase/(decrease) in payables

Increase/(decrease) in payables

(177)

(177)

702

702

Increase/(decrease) in accrued charges and deferred revenue

Increase/(decrease) in accrued charges and deferred revenue

17 864

17 864

736

736

NET CASH FLOW

NET CASH FLOW

147 691

147 691

(17 763 )

(17 763 )

Net increase/(decrease) in cash and cash equivalents

Net increase/(decrease) in cash and cash equivalents

147 691

147 691

(17 763 )

(17 763 )

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the beginning of the year

14 879

14 879

32 642

32 642

Cash and cash equivalents at year-end

Cash and cash equivalents at year-end

162 571

162 571

14 879

14 879

STATEMENT OF CHANGES IN NET ASSETS

STATEMENT OF CHANGES IN NET ASSETS

| (EUR ‘000) |
| --- |
| | Accumulated surplus/
  (deficit) | Economic result of the year | Net assets |
| BALANCE AS AT 31.12.2016 | — | — | — |
| Economic result of the year | — | — | — |
| BALANCE AS AT 31.12.2017 | — | — | — |

(EUR ‘000)

Accumulated surplus/

(deficit)

Economic result of the year

Net assets

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

—

—

—

Economic result of the year

Economic result of the year

—

—

—

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

—

—

—

CONSOLIDATED FINANCIAL STATEMENTS OF THE EDF AND THE EU TRUST FUNDS (15)

CONSOLIDATED FINANCIAL STATEMENTS OF THE EDF AND THE EU TRUST FUNDS

15

CONSOLIDATED BALANCE SHEET

CONSOLIDATED BALANCE SHEET

| (EUR millions) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| NON-CURRENT ASSETS | | |
| Pre-financing | 636 | 457 |
| | 636 | 457 |
| CURRENT ASSETS | | |
| Pre-financing | 1 723 | 1 455 |
| Exchange receivables and non-exchange recoverables | 96 | 143 |
| Cash and cash equivalents | 550 | 738 |
| | 2 369 | 2 336 |
| TOTAL ASSETS | 3 005 | 2 794 |
| NON-CURRENT LIABILITIES | | |
| Provisions | (4) | (4) |
| Financial liabilities | (292) | (106) |
| | (296) | (110) |
| CURRENT LIABILITIES | | |
| Payables | (564) | (549) |
| Accrued charges and deferred income | (755) | (778) |
| | (1 319 ) | (1 327 ) |
| TOTAL LIABILITIES | (1 615 ) | (1 436 ) |
| NET ASSETS | 1 389 | 1 357 |
| FUNDS & RESERVES | | |
| Called fund capital — active EDFs | 46 173 | 42 323 |
| Called fund capital from closed EDFs carried forward | 2 252 | 2 252 |
| Economic result carried forward from previous years | (43 219 ) | (40 146 ) |
| Economic result of the year | (3 818 ) | (3 073 ) |
| NET ASSETS | 1 389 | 1 357 |

(EUR millions)

31.12.2017

31.12.2016

NON-CURRENT ASSETS

NON-CURRENT ASSETS

Pre-financing

Pre-financing

636

636

457

457

636

636

457

457

CURRENT ASSETS

CURRENT ASSETS

Pre-financing

Pre-financing

1 723

1 723

1 455

1 455

Exchange receivables and non-exchange recoverables

Exchange receivables and non-exchange recoverables

96

96

143

143

Cash and cash equivalents

Cash and cash equivalents

550

550

738

738

2 369

2 369

2 336

2 336

TOTAL ASSETS

TOTAL ASSETS

3 005

3 005

2 794

2 794

NON-CURRENT LIABILITIES

NON-CURRENT LIABILITIES

Provisions

Provisions

(4)

(4)

(4)

(4)

Financial liabilities

Financial liabilities

(292)

(292)

(106)

(106)

(296)

(296)

(110)

(110)

CURRENT LIABILITIES

CURRENT LIABILITIES

Payables

Payables

(564)

(564)

(549)

(549)

Accrued charges and deferred income

Accrued charges and deferred income

(755)

(755)

(778)

(778)

(1 319 )

(1 319 )

(1 327 )

(1 327 )

TOTAL LIABILITIES

TOTAL LIABILITIES

(1 615 )

(1 615 )

(1 436 )

(1 436 )

NET ASSETS

NET ASSETS

1 389

1 389

1 357

1 357

FUNDS & RESERVES

FUNDS & RESERVES

Called fund capital — active EDFs

Called fund capital — active EDFs

46 173

46 173

42 323

42 323

Called fund capital from closed EDFs carried forward

Called fund capital from closed EDFs carried forward

2 252

2 252

2 252

2 252

Economic result carried forward from previous years

Economic result carried forward from previous years

(43 219 )

(43 219 )

(40 146 )

(40 146 )

Economic result of the year

Economic result of the year

(3 818 )

(3 818 )

(3 073 )

(3 073 )

NET ASSETS

NET ASSETS

1 389

1 389

1 357

1 357

CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE

CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE

| (EUR millions) |
| --- |
| | 2017 | 2016 |
| REVENUE | | |
| Revenue from non-exchange transactions | | |
| Recovery activities | 61 | 8 |
| Revenue from trust funds donations | 194 | 35 |
| | 255 | 43 |
| Revenue from exchange transactions | | |
| Financial revenue | 4 | 4 |
| Other revenue | 22 | 62 |
| | 26 | 66 |
| Total Revenue | 281 | 108 |
| EXPENSES | | |
| Aid instruments | (3 585 ) | (2 935 ) |
| Expenses implemented by trust funds | (301) | (65) |
| Co-financing expenses | (42) | 15 |
| Finance costs | (8) | 4 |
| Other expenses | (162) | (200) |
| Total Expenses | (4 099 ) | (3 181 ) |
| ECONOMIC RESULT OF THE YEAR | (3 818 ) | (3 073 ) |

(EUR millions)

2017

2016

REVENUE

REVENUE

Revenue from non-exchange transactions

Revenue from non-exchange transactions

Recovery activities

Recovery activities

61

61

8

8

Revenue from trust funds donations

Revenue from trust funds donations

194

194

35

35

255

255

43

43

Revenue from exchange transactions

Revenue from exchange transactions

Financial revenue

Financial revenue

4

4

4

4

Other revenue

Other revenue

22

22

62

62

26

26

66

66

Total Revenue

Total Revenue

281

281

108

108

EXPENSES

EXPENSES

Aid instruments

Aid instruments

(3 585 )

(3 585 )

(2 935 )

(2 935 )

Expenses implemented by trust funds

Expenses implemented by trust funds

(301)

(301)

(65)

(65)

Co-financing expenses

Co-financing expenses

(42)

(42)

15

15

Finance costs

Finance costs

(8)

(8)

4

4

Other expenses

Other expenses

(162)

(162)

(200)

(200)

Total Expenses

Total Expenses

(4 099 )

(4 099 )

(3 181 )

(3 181 )

ECONOMIC RESULT OF THE YEAR

ECONOMIC RESULT OF THE YEAR

(3 818 )

(3 818 )

(3 073 )

(3 073 )

CONSOLIDATED CASH FLOW STATEMENT

CONSOLIDATED CASH FLOW STATEMENT

| (EUR millions) |
| --- |
| | 2017 | 2016 |
| Economic result of the year | (3 818 ) | (3 073 ) |
| Operating activities | | |
| Capital increase — contributions | 3 850 | 3 450 |
| (Increase)/decrease in trust funds contributions | — | (0) |
| (Increase)/decrease in pre-financing | (446) | (242) |
| (Increase)/decrease in exchange receivables and non-exchange recoverables | 47 | 29 |
| Increase/(decrease) in financial liabilities | 186 | 34 |
| Increase/(decrease) in payables | 15 | 29 |
| Increase/(decrease) in accrued charges and deferred income | (22) | (78) |
| NET CASH FLOW | (188) | 149 |
| Net increase/(decrease) in cash and cash equivalents | (188) | 149 |
| Cash and cash equivalents at the beginning of the year | 738 | 589 |
| Cash and cash equivalents at year-end | 550 | 738 |

(EUR millions)

2017

2016

Economic result of the year

Economic result of the year

(3 818 )

(3 818 )

(3 073 )

(3 073 )

Operating activities

Operating activities

Capital increase — contributions

Capital increase — contributions

3 850

3 850

3 450

3 450

(Increase)/decrease in trust funds contributions

(Increase)/decrease in trust funds contributions

—

—

(0)

(0)

(Increase)/decrease in pre-financing

(Increase)/decrease in pre-financing

(446)

(446)

(242)

(242)

(Increase)/decrease in exchange receivables and non-exchange recoverables

(Increase)/decrease in exchange receivables and non-exchange recoverables

47

47

29

29

Increase/(decrease) in financial liabilities

Increase/(decrease) in financial liabilities

186

186

34

34

Increase/(decrease) in payables

Increase/(decrease) in payables

15

15

29

29

Increase/(decrease) in accrued charges and deferred income

Increase/(decrease) in accrued charges and deferred income

(22)

(22)

(78)

(78)

NET CASH FLOW

NET CASH FLOW

(188)

(188)

149

149

Net increase/(decrease) in cash and cash equivalents

Net increase/(decrease) in cash and cash equivalents

(188)

(188)

149

149

Cash and cash equivalents at the beginning of the year

Cash and cash equivalents at the beginning of the year

738

738

589

589

Cash and cash equivalents at year-end

Cash and cash equivalents at year-end

550

550

738

738

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS

| (EUR millions) |
| --- |
| | Fund capital — active EDFs
  (A) | Uncalled funds — active EDFs
  (B) | Called fund capital — active EDFs
  (C) = (A)-(B) | Cumulative Reserves
  (D) | Called fund capital from closed EDFs carried forward
  (E) | Total Net Assets
  (C)+(D)+(E) |
| BALANCE AS AT 31.12.2015 | 73 464 | 34 590 | 38 873 | (40 146 ) | 2 252 | 980 |
| Capital increase — contributions | | (3 450 ) | 3 450 | — | — | 3 450 |
| Economic result of the year | — | — | — | (3 073 ) | — | (3 073 ) |
| BALANCE AS AT 31.12.2016 | 73 464 | 31 140 | 42 323 | (43 219 ) | 2 252 | 1 357 |
| Capital increase — contributions | | (4 050 ) | 4 050 | | | 4 050 |
| Refund to Member States | (200) | | (200) | | | (200) |
| Economic result of the year | | | — | (3 818 ) | | (3 818 ) |
| BALANCE AS AT 31.12.2017 | 73 264 | 27 090 | 46 173 | (47 037 ) | 2 252 | 1 389 |

(EUR millions)

Fund capital — active EDFs

(A)

Uncalled funds — active EDFs

(B)

Called fund capital — active EDFs

(C) = (A)-(B)

Cumulative Reserves

(D)

Called fund capital from closed EDFs carried forward

(E)

Total Net Assets

(C)+(D)+(E)

BALANCE AS AT 31.12.2015

BALANCE AS AT 31.12.2015

73 464

73 464

34 590

34 590

38 873

38 873

(40 146 )

(40 146 )

2 252

2 252

980

980

Capital increase — contributions

Capital increase — contributions

(3 450 )

(3 450 )

3 450

3 450

—

—

3 450

3 450

Economic result of the year

Economic result of the year

—

—

—

—

—

—

(3 073 )

(3 073 )

—

—

(3 073 )

(3 073 )

BALANCE AS AT 31.12.2016

BALANCE AS AT 31.12.2016

73 464

73 464

31 140

31 140

42 323

42 323

(43 219 )

(43 219 )

2 252

2 252

1 357

1 357

Capital increase — contributions

Capital increase — contributions

(4 050 )

(4 050 )

4 050

4 050

4 050

4 050

Refund to Member States

Refund to Member States

(200)

(200)

(200)

(200)

(200)

(200)

Economic result of the year

Economic result of the year

—

—

(3 818 )

(3 818 )

(3 818 )

(3 818 )

BALANCE AS AT 31.12.2017

BALANCE AS AT 31.12.2017

73 264

73 264

27 090

27 090

46 173

46 173

(47 037 )

(47 037 )

2 252

2 252

1 389

1 389

EDF REPORT ON FINANCIAL IMPLEMENTATION

EDF REPORT ON FINANCIAL IMPLEMENTATION

1.   INTRODUCTORY NOTE

INTRODUCTORY NOTE

1.1.   Closed EDFs

Closed EDFs

| — | As the sixth EDF was closed in 2006 and the seventh EDF was closed in 2008, the annual accounts no longer contain implementation tables for these EDFs. However, implementation of the transferred balances can be found in the ninth EDF. |
| --- | --- |

—

As the sixth EDF was closed in 2006 and the seventh EDF was closed in 2008, the annual accounts no longer contain implementation tables for these EDFs. However, implementation of the transferred balances can be found in the ninth EDF.

| — | As in past years, to ensure transparency in the presentation of the accounts for 2017, the tables set out separately for the eighth EDF the part used for Lomé Convention programming and the part used for programming under the Cotonou Agreement. |
| --- | --- |

—

As in past years, to ensure transparency in the presentation of the accounts for 2017, the tables set out separately for the eighth EDF the part used for Lomé Convention programming and the part used for programming under the Cotonou Agreement.

| — | In accordance with Article 1(2)(b) of the Internal Agreement of the ninth EDF, balances and decommitments of previous EDFs have been transferred to the ninth EDF, and, during the life of the ninth EDF, have been committed as ninth EDF funds. |
| --- | --- |

—

In accordance with Article 1(2)(b) of the Internal Agreement of the ninth EDF, balances and decommitments of previous EDFs have been transferred to the ninth EDF, and, during the life of the ninth EDF, have been committed as ninth EDF funds.

2.   10th EDF

10th EDF

The ACP-EC Partnership Agreement signed on 23 June 2000 in Cotonou by the Member States of the European Community and the States of Africa, the Caribbean and the Pacific (ACP States) entered into force on 1 April 2003. The Cotonou Agreement was amended twice, firstly by the agreement signed in Luxembourg on 25 June 2005, secondly by the agreement signed in Ouagadougou on 22 June 2010.

The EU Council Decision of 27 November 2001 (2001/822/EC) on the association of the overseas countries and territories (OCTs) with the European Union entered into force on 2 December 2001. This Decision was amended on 19 March 2007 (Decision 2007/249/EC).

The Internal Agreement on the financing of Community aid under the multiannual financial framework for the period 2008-2013 in accordance with the revised Cotonou Agreement, adopted by the Representatives of the Governments of the Member States of the European Community on 17 July 2006, entered into force on 1 July 2008.

Under the Cotonou Agreement, the second period (2008-2013) of Community aid to the ACP States and OCTs is to be funded by the 10th EDF for an amount of EUR 22 682 million, of which:

| — | EUR 21 966 million is allocated to the ACP countries in accordance with the multiannual financial framework set out in Annex Ib to the revised Cotonou Agreement, of which EUR 20 466 million is managed by the European Commission; |
| --- | --- |

—

EUR 21 966 million is allocated to the ACP countries in accordance with the multiannual financial framework set out in Annex Ib to the revised Cotonou Agreement, of which EUR 20 466 million is managed by the European Commission;

| — | EUR 286 million is allocated to the OCTs in accordance with Annex IIAa of the revised Council Decision on the association of the OCTs with the European Community, of which EUR 256 million is managed by the European Commission; |
| --- | --- |

—

EUR 286 million is allocated to the OCTs in accordance with Annex IIAa of the revised Council Decision on the association of the OCTs with the European Community, of which EUR 256 million is managed by the European Commission;

| — | EUR 430 million is for the Commission to finance the costs arising from the programming and implementation of 10th EDF resources, in accordance with Article 6 of the Internal Agreement. |
| --- | --- |

—

EUR 430 million is for the Commission to finance the costs arising from the programming and implementation of 10th EDF resources, in accordance with Article 6 of the Internal Agreement.

The actual credits available (see table 1.3) differ from the above due to: decommitments from previous EDFs, interest and co-financing.

1.3

According to the ‘Sunset clause’ of the 10th EDF (Articles 1(4) and 1(5) of the 10th EDF Internal Agreement), no funds could be committed after 31 December 2013. Uncommitted funds were transferred to the 11th EDF performance reserve.

Sunset clause’

3.   11th EDF

11th EDF

The Internal Agreement on the financing of Union aid under the multiannual financial framework for the period 2014-2020 in accordance with the revised Cotonou Agreement, adopted by the Representatives of the Governments of the Member States of the European Union on August 2013, entered into force on March 2015.

Under the Cotonou Agreement, the third period (2014-2020) of Union aid to the ACP States and OCTs is to be funded by the 11th EDF for an amount of EUR 30 506 million, of which:

| — | EUR 29 089 million is allocated to the ACP countries in accordance with Article 1.2(a) and Article 2(d) of the Internal Agreement, of which EUR 27 955 million is managed by the European Commission; |
| --- | --- |

—

EUR 29 089 million is allocated to the ACP countries in accordance with Article 1.2(a) and Article 2(d) of the Internal Agreement, of which EUR 27 955 million is managed by the European Commission;

| — | EUR 364,5 million is allocated to the OCTs in accordance with Article 1.2(a) and Article 3.1 of the Internal Agreement, of which 359,5 million is managed by the European Commission; |
| --- | --- |

—

EUR 364,5 million is allocated to the OCTs in accordance with Article 1.2(a) and Article 3.1 of the Internal Agreement, of which 359,5 million is managed by the European Commission;

| — | EUR 1 052,5 million is for the Commission to finance the costs arising from the programming and implementation of 11th EDF resources, in accordance with Article 1.2(a) of the Internal Agreement. |
| --- | --- |

—

EUR 1 052,5 million is for the Commission to finance the costs arising from the programming and implementation of 11th EDF resources, in accordance with Article 1.2(a) of the Internal Agreement.

The actual credits available (see table 1.4) differ from the above due to the same reasons as mentioned under the 10th EDF above.

1.4

Remaining funds on non-mobilisable performance reserves at 31 December 2017

Remaining funds on non-mobilisable performance reserves at 31 December 2017

The amounts decommitted from projects under the ninth and previous EDFs are transferred to the performance reserve of the 10th EDF, with the exception of Stabex funds.

The decommited funds from projects under the 10th EDF are transferred to the performance reserve of the 11th EDF.

During 2017, all decommitted funds from previous EDFs were transferred to the respective reserves.

In accordance with Article 1.4 of the 11th EDF Internal Agreement and the Council Decision of 2 August 2016 (2016/1337), an amount of decommitted funds from the 10th EDF shall be allocated for the purpose of replenishing the African Peace Facility for the period 2016-2018 up to a maximum of EUR 491 million and up to EUR 16 million for support of expenditure.

In accordance with Article 1.4 of the 11th EDF Internal Agreement and the Council Decision of 4 July 2017 (2017/1206), the shares of Member States’ contributions set out in Article 1(2)(a) of the Internal Agreements of the Eighth and Ninth EDF shall be reduced accordingly for an amount of EUR 200 million from funds decommitted under the Eighth and the Ninth EDF.

| (EUR millions) |
| --- |
| Total available on non-mobilisable performance reserves at 31.12.2017 | |
| Non-mobilisable reserve from decommitted funds under the eighth, and ninth EDF at 31.12.2017 | 309,1 |
| Non-mobilisable reserve from decommitted funds under the 10th EDF at 31.12.2017 | 206,0 |
| Total available on non-mobilisable performance reserves at 31.12.2017 | 515,1 |

(EUR millions)

Total available on non-mobilisable performance reserves at 31.12.2017

Non-mobilisable reserve from decommitted funds under the eighth, and ninth EDF at 31.12.2017

309,1

Non-mobilisable reserve from decommitted funds under the 10th EDF at 31.12.2017

206,0

Total available on non-mobilisable performance reserves at 31.12.2017

515,1

EDF Co-financings

EDF Co-financings

Under the 10th and 11th EDFs, transfer agreements for co-financings from Member States were signed, and commitment appropriations were opened for a total amount of EUR 228,5 million, while payment appropriations were opened for the cashed amounts totalling EUR 211,2 million.

The situation of co-financing appropriations at 31.12.2017 is shown in the table below:

| (EUR millions) |
| --- |
| | Commitments appropriations | Payment appropriations |
| Co-financing — A Envelope | 208,8 | 191,9 |
| Co-financing — Intra-ACP | 13,4 | 13,4 |
| Co-financing — Administrative expenses | 6,3 | 5,9 |
| | 228,5 | 211,2 |

(EUR millions)

Commitments appropriations

Payment appropriations

Co-financing — A Envelope

208,8

191,9

Co-financing — Intra-ACP

13,4

13,4

Co-financing — Administrative expenses

6,3

5,9

228,5

228,5

211,2

211,2

The following tables, concerning the amounts decided, contracted and paid, show net figures. The tables presenting the situation by instrument are annexed.

Table 1.1

Table 1.1

Eight EDF

Eight EDF

EVOLUTION OF APPROPRIATIONS: 31 December 2017

EVOLUTION OF APPROPRIATIONS: 31 December 2017

ANALYSIS OF CREDITS PER INSTRUMENT

ANALYSIS OF CREDITS PER INSTRUMENT

| (EUR millions) |
| --- |
| INSTRUMENT | INITIAL APPROPRIATION | INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016 | INCREASE OR DECREASE IN RESOURCES IN 2017 | Notes | CURRENT LEVEL APPROPRIATION |
| ACP | | | | | |
| Lomé | | | | | |
| Regular MS Contributions | 12 967 | (3 272 ) | (6) | | 9 689 |
| Aid for refugees | 120 | (20) | | | 100 |
| Emergency aid (Lomé) | 140 | (4) | | | 136 |
| Heavily indebted poor countries (Lomé) | 0 | 1 060 | | | 1 060 |
| Interest-rate subsidies | 370 | (298) | (3) | (2) | 69 |
| Risk capital | 1 000 | 15 | | | 1 015 |
| Stabex | 1 800 | (1 077 ) | | | 723 |
| Structural adjustment | 1 400 | 97 | | | 1 497 |
| Sysmin | 575 | (474) | | | 101 |
| Total indicative programmes | 7 562 | (2 605 ) | (3) | (2) | 4 954 |
| Utilisation of interest income | 0 | 35 | | | 35 |
| Cotonou | | | | | |
| Regular MS Contributions | 0 | 650 | (0) | | 650 |
| A Envelope — National Allocations | 0 | 417 | (0) | (2) | 417 |
| B Envelope — National Allocations | 0 | 233 | (0) | (2) | 233 |
| Interests and other receipts | 0 | 0 | | | 0 |
| SUB TOTAL ACP | 12 967 | (2 621 ) | (6) | | 10 339 |
| OCTs | | | | | |
| Lomé | | | | | |
| Regular MS Contributions | 0 | 46 | (1) | | 46 |
| Interest-rate subsidies | 0 | 1 | | | 1 |
| Risk capital | 0 | 6 | | | 6 |
| Stabex | 0 | 1 | | | 1 |
| Sysmin | 0 | 2 | | | 2 |
| Total indicative programmes | 0 | 36 | (1) | (2) | 35 |
| SUB TOTAL OCTs | 0 | 46 | (1) | | 46 |
| TOTAL 8th EDF | 12 967 | (2 575 ) | (7) | | 10 385 |

(EUR millions)

INSTRUMENT

INITIAL APPROPRIATION

INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016

INCREASE OR DECREASE IN RESOURCES IN 2017

Notes

CURRENT LEVEL APPROPRIATION

ACP

ACP

Lomé

Lomé

Regular MS Contributions

Regular MS Contributions

12 967

12 967

(3 272 )

(3 272 )

(6)

(6)

9 689

9 689

Aid for refugees

120

(20)

100

Emergency aid (Lomé)

140

(4)

136

Heavily indebted poor countries (Lomé)

0

1 060

1 060

Interest-rate subsidies

370

(298)

(3)

(2)

2

69

Risk capital

1 000

15

1 015

Stabex

1 800

(1 077 )

723

Structural adjustment

1 400

97

1 497

Sysmin

575

(474)

101

Total indicative programmes

7 562

(2 605 )

(3)

(2)

2

4 954

Utilisation of interest income

0

35

35

Cotonou

Cotonou

Regular MS Contributions

Regular MS Contributions

0

0

650

650

(0)

(0)

650

650

A Envelope — National Allocations

0

417

(0)

(2)

2

417

B Envelope — National Allocations

0

233

(0)

(2)

2

233

Interests and other receipts

0

0

0

SUB TOTAL ACP

SUB TOTAL ACP

12 967

12 967

(2 621 )

(2 621 )

(6)

(6)

10 339

10 339

OCTs

OCTs

Lomé

Lomé

Regular MS Contributions

Regular MS Contributions

0

0

46

46

(1)

(1)

46

46

Interest-rate subsidies

0

1

1

Risk capital

0

6

6

Stabex

0

1

1

Sysmin

0

2

2

Total indicative programmes

0

36

(1)

(2)

2

35

SUB TOTAL OCTs

SUB TOTAL OCTs

0

0

46

46

(1)

(1)

46

46

TOTAL 8th EDF

TOTAL 8th EDF

12 967

12 967

(2 575 )

(2 575 )

(7)

(7)

10 385

10 385

Table 1.2

Table 1.2

Ninth EDF

Ninth EDF

EVOLUTION OF APPROPRIATIONS: 31 December 2017

EVOLUTION OF APPROPRIATIONS: 31 December 2017

ANALYSIS OF CREDITS PER INSTRUMENT

ANALYSIS OF CREDITS PER INSTRUMENT

| (EUR millions) |
| --- |
| INSTRUMENT | INITIAL APPROPRIATION | INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016 | INCREASE OR DECREASE IN RESOURCES IN 2017 | Notes | CURRENT LEVEL APPROPRIATION |
| ACP | | | | | |
| Lomé | | | | | |
| Regular MS Contributions | 0 | 672 | (2) | | 669 |
| Transfers from 6th EDF — Lomé | 0 | 20 | (0) | (3) | 20 |
| Transfers from 7th EDF — Lomé | 0 | 651 | (2) | (3) | 649 |
| Cotonou | | | | | |
| Regular MS Contributions | 8 919 | 5 583 | (34) | | 14 468 |
| A Envelope — National Allocations | 5 318 | 3 319 | (13) | (3) | 8 624 |
| B Envelope — National Allocations | 2 108 | (896) | (2) | (3) | 1 210 |
| CDE, CTA and Parliamentary Assembly | 164 | (10) | | | 154 |
| Implementation costs | 125 | 52 | | | 177 |
| Interests and other receipts | 0 | 63 | | | 63 |
| Other Intra-ACP allocations | 300 | 2 314 | (13) | (3) | 2 602 |
| Peace facility | 0 | 354 | | | 354 |
| Regional allocations | 904 | (134) | (5) | (3) | 765 |
| Special allocation R.D. Congo | 0 | 105 | | | 105 |
| Special allocation South Sudan | 0 | 267 | | (5) | 267 |
| Special allocation Sudan | 0 | 110 | | (4) | 110 |
| Voluntary contribution Peace facility | 0 | 39 | | | 39 |
| SUB TOTAL ACP | 8 919 | 6 255 | (36) | | 15 138 |
| OCTs | | | | | |
| Lomé | | | | | |
| Regular MS Contributions | 0 | 3 | | | 3 |
| Transfers from 6th EDF — Lomé | 0 | 0 | | | 0 |
| Transfers from 7th EDF — Lomé | 0 | 3 | | | 3 |
| Cotonou | | | | | |
| Regular MS Contributions | 0 | 290 | (1) | | 289 |
| A Envelope — National Allocations | 0 | 237 | (0) | (3) | 237 |
| B Envelope — National Allocations | 0 | 4 | | | 4 |
| Regional allocations | 0 | 48 | (1) | (3) | 47 |
| Studies/Technical assistance OCTs | 0 | 1 | | | 1 |
| SUB TOTAL OCTs | 0 | 293 | (1) | | 292 |
| TOTAL 9th EDF | 8 919 | 6 548 | (37) | | 15 430 |

(EUR millions)

INSTRUMENT

INITIAL APPROPRIATION

INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016

INCREASE OR DECREASE IN RESOURCES IN 2017

Notes

CURRENT LEVEL APPROPRIATION

ACP

ACP

Lomé

Lomé

Regular MS Contributions

Regular MS Contributions

0

0

672

672

(2)

(2)

669

669

Transfers from 6th EDF — Lomé

0

20

(0)

(3)

3

20

Transfers from 7th EDF — Lomé

0

651

(2)

(3)

3

649

Cotonou

Cotonou

Regular MS Contributions

Regular MS Contributions

8 919

8 919

5 583

5 583

(34)

(34)

14 468

14 468

A Envelope — National Allocations

5 318

3 319

(13)

(3)

3

8 624

B Envelope — National Allocations

2 108

(896)

(2)

(3)

3

1 210

CDE, CTA and Parliamentary Assembly

164

(10)

154

Implementation costs

125

52

177

Interests and other receipts

0

63

63

Other Intra-ACP allocations

300

2 314

(13)

(3)

3

2 602

Peace facility

0

354

354

Regional allocations

904

(134)

(5)

(3)

3

765

Special allocation R.D. Congo

0

105

105

Special allocation South Sudan

0

267

(5)

5

267

Special allocation Sudan

0

110

(4)

4

110

Voluntary contribution Peace facility

0

39

39

SUB TOTAL ACP

SUB TOTAL ACP

8 919

8 919

6 255

6 255

(36)

(36)

15 138

15 138

OCTs

OCTs

Lomé

Lomé

Regular MS Contributions

Regular MS Contributions

0

0

3

3

3

3

Transfers from 6th EDF — Lomé

0

0

0

Transfers from 7th EDF — Lomé

0

3

3

Cotonou

Cotonou

Regular MS Contributions

Regular MS Contributions

0

0

290

290

(1)

(1)

289

289

A Envelope — National Allocations

0

237

(0)

(3)

3

237

B Envelope — National Allocations

0

4

4

Regional allocations

0

48

(1)

(3)

3

47

Studies/Technical assistance OCTs

0

1

1

SUB TOTAL OCTs

SUB TOTAL OCTs

0

0

293

293

(1)

(1)

292

292

TOTAL 9th EDF

TOTAL 9th EDF

8 919

8 919

6 548

6 548

(37)

(37)

15 430

15 430

Table 1.3

Table 1.3

10th EDF

10th EDF

EVOLUTION OF APPROPRIATIONS: 31 December 2017

EVOLUTION OF APPROPRIATIONS: 31 December 2017

ANALYSIS OF CREDITS PER INSTRUMENT

ANALYSIS OF CREDITS PER INSTRUMENT

| (EUR millions) |
| --- |
| INSTRUMENT | INITIAL APPROPRIATION | INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016 | INCREASE OR DECREASE IN RESOURCES IN 2017 | Notes | CURRENT LEVEL APPROPRIATION |
| ACP | | | | | |
| Regular MS Contributions | 20 896 | 233 | (120) | | 21 009 |
| A Envelope — National Allocations | 0 | 13 244 | (144) | (7) | 13 100 |
| A Envelope reserve | 13 500 | (13 500 ) | | | 0 |
| B Envelope — National Allocations | 0 | 2 015 | (11) | (7) | 2 004 |
| B Envelope reserve | 1 800 | (1 800 ) | | | 0 |
| Implementation costs | 430 | 15 | (0) | (7) | 445 |
| Institutional and support expenditure | 0 | 232 | (0) | (7) | 232 |
| Interests and other receipts | 0 | 84 | 2 | (7) | 85 |
| Intra-ACP Reserve | 2 700 | (2 700 ) | | | 0 |
| National allocations Reserve A Envelope Stabex | 0 | 0 | | | 0 |
| NIP/RIP reserve | 683 | (683) | | | 0 |
| Non-mobilisable reserve | 0 | 243 | 43 | (7) | 286 |
| Other Intra-ACP allocations | 0 | 1 889 | (3) | (7) | 1 886 |
| Peace facility | 0 | 1 014 | | | 1 014 |
| Regional allocations | 0 | 1 962 | (5) | (7) | 1 956 |
| Regional allocations reserve | 1 783 | (1 783 ) | | | 0 |
| Co-financing | 0 | 204 | 0 | | 204 |
| A Envelope — National Allocations | 0 | 187 | | (8) | 187 |
| Implementation costs | 0 | 5 | | (8) | 5 |
| Other Intra-ACP allocations | 0 | 12 | | (8) | 12 |
| Peace facility | 0 | 1 | | (8) | 1 |
| SUB TOTAL ACP | 20 896 | 437 | (120) | | 21 213 |
| OCTs | | | | | |
| Regular MS Contributions | 0 | 275 | 0 | | 275 |
| A Envelope — National Allocations | 0 | 193 | (1) | (7) | 192 |
| A Envelope reserve | 0 | 0 | | | 0 |
| B Envelope — National Allocations | 0 | 15 | (0) | (7) | 15 |
| B Envelope reserve | 0 | 0 | | | 0 |
| National allocations Reserve A Envelope Stabex | 0 | 0 | | | 0 |
| Non-mobilisable reserve | 0 | 21 | 2 | (7) | 23 |
| Regional allocations | 0 | 40 | | | 40 |
| Regional allocations reserve | 0 | 0 | | | 0 |
| Studies/Technical assistance OCTs | 0 | 5 | (0) | (7) | 5 |
| SUB TOTAL OCTs | 0 | 275 | 0 | | 275 |
| TOTAL 10th EDF | 20 896 | 712 | (120) | | 21 488 |

(EUR millions)

INSTRUMENT

INITIAL APPROPRIATION

INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016

INCREASE OR DECREASE IN RESOURCES IN 2017

Notes

CURRENT LEVEL APPROPRIATION

ACP

ACP

Regular MS Contributions

Regular MS Contributions

20 896

20 896

233

233

(120)

(120)

21 009

21 009

A Envelope — National Allocations

0

13 244

(144)

(7)

7

13 100

A Envelope reserve

13 500

(13 500 )

0

B Envelope — National Allocations

0

2 015

(11)

(7)

7

2 004

B Envelope reserve

1 800

(1 800 )

0

Implementation costs

430

15

(0)

(7)

7

445

Institutional and support expenditure

0

232

(0)

(7)

7

232

Interests and other receipts

0

84

2

(7)

7

85

Intra-ACP Reserve

2 700

(2 700 )

0

National allocations Reserve A Envelope Stabex

0

0

0

NIP/RIP reserve

683

(683)

0

Non-mobilisable reserve

0

243

43

(7)

7

286

Other Intra-ACP allocations

0

1 889

(3)

(7)

7

1 886

Peace facility

0

1 014

1 014

Regional allocations

0

1 962

(5)

(7)

7

1 956

Regional allocations reserve

1 783

(1 783 )

0

Co-financing

Co-financing

0

0

204

204

0

0

204

204

A Envelope — National Allocations

0

187

(8)

8

187

Implementation costs

0

5

(8)

8

5

Other Intra-ACP allocations

0

12

(8)

8

12

Peace facility

0

1

(8)

8

1

SUB TOTAL ACP

SUB TOTAL ACP

20 896

20 896

437

437

(120)

(120)

21 213

21 213

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

0

0

275

275

0

0

275

275

A Envelope — National Allocations

0

193

(1)

(7)

7

192

A Envelope reserve

0

0

0

B Envelope — National Allocations

0

15

(0)

(7)

7

15

B Envelope reserve

0

0

0

National allocations Reserve A Envelope Stabex

0

0

0

Non-mobilisable reserve

0

21

2

(7)

7

23

Regional allocations

0

40

40

Regional allocations reserve

0

0

0

Studies/Technical assistance OCTs

0

5

(0)

(7)

7

5

SUB TOTAL OCTs

SUB TOTAL OCTs

0

0

275

275

0

0

275

275

TOTAL 10th EDF

TOTAL 10th EDF

20 896

20 896

712

712

(120)

(120)

21 488

21 488

Table 1.4

Table 1.4

11th EDF

11th EDF

EVOLUTION OF APPROPRIATIONS: 31 December 2017

EVOLUTION OF APPROPRIATIONS: 31 December 2017

ANALYSIS OF CREDITS PER INSTRUMENT

ANALYSIS OF CREDITS PER INSTRUMENT

| (EUR millions) |
| --- |
| INSTRUMENT | INITIAL APPROPRIATION | INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016 | INCREASE OR DECREASE IN RESOURCES IN 2017 | Notes | CURRENT LEVEL APPROPRIATION |
| ACP | | | | | |
| Regular MS Contributions | 29 008 | 54 | 170 | | 29 232 |
| A Envelope — National Allocations | 0 | 15 115 | 425 | | 15 540 |
| B Envelope — National Allocations | 0 | 648 | 67 | | 715 |
| B Envelope reserve | 0 | 0 | | | 0 |
| Implementation costs | 1 053 | 0 | | | 1 053 |
| Institutional and support expenditure | 0 | 246 | | | 246 |
| Interests and other receipts | 0 | 16 | 0 | | 16 |
| Intra-ACP Reserve | 3 590 | (3 387 ) | (110) | | 93 |
| National allocations Reserve A Envelope Stabex | 0 | 0 | 0 | | 0 |
| NIP/RIP reserve | 24 365 | (20 937 ) | (1 077 ) | | 2 351 |
| Non-mobilisable reserve | 0 | 31 | 170 | (16) | 201 |
| Other Intra-ACP allocations | 0 | 2 241 | 10 | | 2 251 |
| Peace facility | 0 | 900 | 100 | | 1 000 |
| Regional allocations | 0 | 5 181 | 585 | | 5 766 |
| Co-financing | 0 | 5 | 20 | | 24 |
| A Envelope — National Allocations | 0 | 3 | 19 | | 22 |
| Implementation costs | 0 | 0 | 1 | | 1 |
| Peace facility | 0 | 1 | | | 1 |
| EC Internal SLA | 0 | 1 | 0 | | 1 |
| A Envelope — National Allocations | 0 | 1 | 0 | | 1 |
| SUB TOTAL ACP | 29 008 | 60 | 190 | | 29 257 |
| OCTs | | | | | |
| Regular MS Contributions | 0 | 363 | (5) | | 358 |
| A Envelope — National Allocations | 0 | 41 | 142 | | 183 |
| NIP/RIP reserve | 0 | 316 | (151) | | 165 |
| Non-mobilisable reserve | 0 | 3 | 1 | (16) | 5 |
| Regional allocations | 0 | 0 | 1 | | 1 |
| Studies/Technical assistance OCTs | 0 | 3 | 2 | | 5 |
| Co-financing | 0 | 0 | 0 | | 0 |
| A Envelope — National Allocations | 0 | 0 | 0 | | 0 |
| EC Internal SLA | 0 | 0 | 0 | | 0 |
| A Envelope — National Allocations | 0 | 0 | 0 | | 0 |
| SUB TOTAL OCTs | 0 | 363 | (5) | | 358 |
| Regular MS Contributions | 0 | 0 | 6 | | 6 |
| A Envelope — National Allocations | 0 | 0 | 6 | | 6 |
| SUB TOTAL | 0 | 0 | 6 | | 6 |
| TOTAL 11th EDF | 29 008 | 423 | 191 | | 29 621 |

(EUR millions)

INSTRUMENT

INITIAL APPROPRIATION

INCREASES/DECREASES IN CUMULATIVE RESOURCES AT 31 DECEMBER 2016

INCREASE OR DECREASE IN RESOURCES IN 2017

Notes

CURRENT LEVEL APPROPRIATION

ACP

ACP

Regular MS Contributions

Regular MS Contributions

29 008

29 008

54

54

170

170

29 232

29 232

A Envelope — National Allocations

0

15 115

425

15 540

B Envelope — National Allocations

0

648

67

715

B Envelope reserve

0

0

0

Implementation costs

1 053

0

1 053

Institutional and support expenditure

0

246

246

Interests and other receipts

0

16

0

16

Intra-ACP Reserve

3 590

(3 387 )

(110)

93

National allocations Reserve A Envelope Stabex

0

0

0

0

NIP/RIP reserve

24 365

(20 937 )

(1 077 )

2 351

Non-mobilisable reserve

0

31

170

(16)

16

201

Other Intra-ACP allocations

0

2 241

10

2 251

Peace facility

0

900

100

1 000

Regional allocations

0

5 181

585

5 766

Co-financing

Co-financing

0

0

5

5

20

20

24

24

A Envelope — National Allocations

0

3

19

22

Implementation costs

0

0

1

1

Peace facility

0

1

1

EC Internal SLA

EC Internal SLA

0

0

1

1

0

0

1

1

A Envelope — National Allocations

0

1

0

1

SUB TOTAL ACP

SUB TOTAL ACP

29 008

29 008

60

60

190

190

29 257

29 257

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

0

0

363

363

(5)

(5)

358

358

A Envelope — National Allocations

0

41

142

183

NIP/RIP reserve

0

316

(151)

165

Non-mobilisable reserve

0

3

1

(16)

16

5

Regional allocations

0

0

1

1

Studies/Technical assistance OCTs

0

3

2

5

Co-financing

Co-financing

0

0

0

0

0

0

0

0

A Envelope — National Allocations

0

0

0

0

EC Internal SLA

EC Internal SLA

0

0

0

0

0

0

0

0

A Envelope — National Allocations

0

0

0

0

SUB TOTAL OCTs

SUB TOTAL OCTs

0

0

363

363

(5)

(5)

358

358

Regular MS Contributions

Regular MS Contributions

0

0

0

0

6

6

6

6

A Envelope — National Allocations

0

0

6

6

SUB TOTAL

SUB TOTAL

0

0

0

0

6

6

6

6

TOTAL 11th EDF

TOTAL 11th EDF

29 008

29 008

423

423

191

191

29 621

29 621

Table 2.1

Table 2.1

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

PROGRESS REPORT

PROGRESS REPORT

| (EUR millions) |
| --- |
| | ALLOCATION | EDF |
| | 8 | 9 | 10 | 11 | TOTAL |
| Lomé | Sundry Income | 35 | | | | 35 |
| Total indicative programmes | 4 989 | | | | 4 989 |
| Total Non-Programmable Aid | 4 711 | | | | 4 711 |
| Transfers from other funds | | 672 | | | 672 |
| SUB TOTAL: REGULAR MS CONTRIBUTIONS | 9 735 | 672 | | | 10 407 |
| Cotonou | A Envelope — National Allocations | 417 | 8 861 | 13 292 | 15 729 | 38 299 |
| B Envelope — National Allocations | 233 | 1 215 | 2 019 | 715 | 4 181 |
| Bridging facility | | | | (0) | (0) |
| CDE, CTA and Parliamentary Assembly | | 154 | | | 154 |
| Country reserve | | | 0 | 0 | 0 |
| Implementation Costs and Interests Revenues | 0 | 240 | 536 | 1 073 | 1 849 |
| Intra-ACP allocations | | 2 955 | 3 132 | 3 497 | 9 584 |
| Intra-ACP Reserve | | | 0 | 93 | 93 |
| National allocations Reserve A Envelope Stabex | | | 0 | 0 | 0 |
| NIP/RIP reserve | | | 0 | 2 515 | 2 515 |
| Non-mobilisable reserve | | | 309 | 206 | 515 |
| Regional allocations | | 812 | 1 996 | 5 767 | 8 575 |
| Regional allocations reserve | | | 0 | | 0 |
| Special allocation R.D. Congo | | 105 | | | 105 |
| Special allocation South Sudan | | 267 | | | 267 |
| Special allocation Sudan | | 110 | | | 110 |
| Voluntary contribution Peace facility | | 39 | | | 39 |
| SUB TOTAL: REGULAR MS CONTRIBUTIONS | 650 | 14 758 | 21 284 | 29 596 | 66 287 |
| A Envelope — National Allocations | | | | 1 | 1 |
| SUB TOTAL: EC INTERNAL SLA | | | | 1 | 1 |
| A Envelope — National Allocations | | | 187 | 22 | 209 |
| Implementation Costs and Interests Revenues | | | 5 | 1 | 6 |
| Intra-ACP allocations | | | 12 | 1 | 13 |
| SUB TOTAL: CO-FINANCING | | | 204 | 24 | 229 |
| | TOTAL | 10 385 | 15 430 | 21 488 | 29 621 | 76 924 |

(EUR millions)

ALLOCATION

EDF

8

9

10

11

TOTAL

Lomé

Lomé

Sundry Income

35

35

Total indicative programmes

4 989

4 989

Total Non-Programmable Aid

4 711

4 711

Transfers from other funds

672

672

SUB TOTAL: REGULAR MS CONTRIBUTIONS

SUB TOTAL: REGULAR MS CONTRIBUTIONS

9 735

672

10 407

Cotonou

Cotonou

A Envelope — National Allocations

417

8 861

13 292

15 729

38 299

B Envelope — National Allocations

233

1 215

2 019

715

4 181

Bridging facility

(0)

(0)

CDE, CTA and Parliamentary Assembly

154

154

Country reserve

0

0

0

Implementation Costs and Interests Revenues

0

240

536

1 073

1 849

Intra-ACP allocations

2 955

3 132

3 497

9 584

Intra-ACP Reserve

0

93

93

National allocations Reserve A Envelope Stabex

0

0

0

NIP/RIP reserve

0

2 515

2 515

Non-mobilisable reserve

309

206

515

Regional allocations

812

1 996

5 767

8 575

Regional allocations reserve

0

0

Special allocation R.D. Congo

105

105

Special allocation South Sudan

267

267

Special allocation Sudan

110

110

Voluntary contribution Peace facility

39

39

SUB TOTAL: REGULAR MS CONTRIBUTIONS

SUB TOTAL: REGULAR MS CONTRIBUTIONS

650

14 758

21 284

29 596

66 287

A Envelope — National Allocations

1

1

SUB TOTAL: EC INTERNAL SLA

SUB TOTAL: EC INTERNAL SLA

1

1

A Envelope — National Allocations

187

22

209

Implementation Costs and Interests Revenues

5

1

6

Intra-ACP allocations

12

1

13

SUB TOTAL: CO-FINANCING

SUB TOTAL: CO-FINANCING

204

24

229

TOTAL

TOTAL

10 385

15 430

21 488

29 621

76 924

| | EDF | Aggregate Total | Cummulative Figures | Annual Figures |
| --- | --- | --- | --- | --- |
| At 31/12/2017 | % of allocation | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 |
| Decisions | | | | | | | | | | | | | |
| | 8 | 10 382 | 100 % | 10 786 | (42) | (45) | (60) | (64) | (98) | (63) | (12) | (13) | (9) |
| | 9 | 15 391 | 100 % | 16 633 | (54) | (116) | (9) | (297) | (72) | (381) | (170) | (104) | (38) |
| | 10 | 21 052 | 98 % | 4 766 | 3 501 | 2 349 | 3 118 | 3 524 | 4 131 | (95) | (156) | (80) | (5) |
| | 11 | 19 027 | 64 % | | | | | | | 1 160 | 5 372 | 6 688 | 5 807 |
| Total | | 65 852 | | 32 185 | 3 405 | 2 187 | 3 049 | 3 163 | 3 961 | 621 | 5 034 | 6 491 | 5 754 |
| Assigned Funds | | | | | | | | | | | | | |
| | 8 | 10 376 | 100 % | 10 541 | (42) | 8 | (13) | (46) | (11) | (37) | (16) | (6) | (3) |
| | 9 | 15 289 | 99 % | 14 209 | 997 | 476 | 9 | (187) | (96) | (1) | (52) | (46) | (20) |
| | 10 | 20 125 | 94 % | 130 | 3 184 | 2 820 | 2 514 | 3 460 | 3 457 | 2 687 | 783 | 541 | 550 |
| | 11 | 13 453 | 45 % | | | | | | | 731 | 3 293 | 3 745 | 5 684 |
| Total | | 59 242 | | 24 881 | 4 140 | 3 304 | 2 509 | 3 226 | 3 350 | 3 380 | 4 008 | 4 234 | 6 211 |
| Payments | | | | | | | | | | | | | |
| | 8 | 10 375 | 100 % | 9 930 | 152 | 158 | 90 | 15 | 18 | 16 | (3) | (0) | (1) |
| | 9 | 15 164 | 98 % | 10 011 | 1 806 | 1 304 | 906 | 539 | 231 | 145 | 43 | 68 | 111 |
| | 10 | 17 753 | 83 % | 90 | 1 111 | 1 772 | 1 879 | 2 655 | 2 718 | 2 760 | 2 024 | 1 466 | 1 277 |
| | 11 | 6 206 | 21 % | | | | | | | 595 | 1 024 | 1 816 | 2 770 |
| Total | | 49 497 | | 20 031 | 3 069 | 3 233 | 2 874 | 3 209 | 2 967 | 3 516 | 3 088 | 3 350 | 4 158 |
| (*) | Negative figures represent decommitments |

EDF

Aggregate Total

Cummulative Figures

Annual Figures

At 31/12/2017

% of allocation

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Decisions

Decisions

8

10 382

100 %

10 786

(42)

(45)

(60)

(64)

(98)

(63)

(12)

(13)

(9)

9

15 391

100 %

16 633

(54)

(116)

(9)

(297)

(72)

(381)

(170)

(104)

(38)

10

21 052

98 %

4 766

3 501

2 349

3 118

3 524

4 131

(95)

(156)

(80)

(5)

11

19 027

64 %

1 160

5 372

6 688

5 807

Total

Total

65 852

65 852

32 185

32 185

3 405

3 405

2 187

2 187

3 049

3 049

3 163

3 163

3 961

3 961

621

621

5 034

5 034

6 491

6 491

5 754

5 754

Assigned Funds

Assigned Funds

8

10 376

100 %

10 541

(42)

8

(13)

(46)

(11)

(37)

(16)

(6)

(3)

9

15 289

99 %

14 209

997

476

9

(187)

(96)

(1)

(52)

(46)

(20)

10

20 125

94 %

130

3 184

2 820

2 514

3 460

3 457

2 687

783

541

550

11

13 453

45 %

731

3 293

3 745

5 684

Total

Total

59 242

59 242

24 881

24 881

4 140

4 140

3 304

3 304

2 509

2 509

3 226

3 226

3 350

3 350

3 380

3 380

4 008

4 008

4 234

4 234

6 211

6 211

Payments

Payments

8

10 375

100 %

9 930

152

158

90

15

18

16

(3)

(0)

(1)

9

15 164

98 %

10 011

1 806

1 304

906

539

231

145

43

68

111

10

17 753

83 %

90

1 111

1 772

1 879

2 655

2 718

2 760

2 024

1 466

1 277

11

6 206

21 %

595

1 024

1 816

2 770

Total

Total

49 497

49 497

20 031

20 031

3 069

3 069

3 233

3 233

2 874

2 874

3 209

3 209

2 967

2 967

3 516

3 516

3 088

3 088

3 350

3 350

4 158

4 158

(*)

Negative figures represent decommitments

Table 2.2

Table 2.2

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

| (EUR millions) |
| --- |
| | EDF |
| 8 | % | 9 | % | 10 | % | 11 | % | TOTAL | % |
| (9) | (9) | (9) | (9) | (9) |
| Lomé | Sundry Income | | | | | | | | | | |
| Appropriations | 35 | | | | | | | | 35 | |
| Decisions | 35 | 100 | | | | | | | 35 | 100 |
| Assigned funds | 35 | 100 | | | | | | | 35 | 100 |
| Payments | 35 | 100 | | | | | | | 35 | 100 |
| Total indicative programmes | | | | | | | | | | |
| Appropriations | 4 989 | | | | | | | | 4 989 | |
| Decisions | 4 987 | 100 | | | | | | | 4 987 | 100 |
| Assigned funds | 4 986 | 100 | | | | | | | 4 986 | 100 |
| Payments | 4 985 | 100 | | | | | | | 4 985 | 100 |
| Total Non-Programmable Aid | | | | | | | | | | |
| Appropriations | 4 711 | | | | | | | | 4 711 | |
| Decisions | 4 710 | 100 | | | | | | | 4 710 | 100 |
| Assigned funds | 4 706 | 100 | | | | | | | 4 706 | 100 |
| Payments | 4 706 | 100 | | | | | | | 4 706 | 100 |
| Transfers from other funds | | | | | | | | | | |
| Appropriations | | | 672 | | | | | | 672 | |
| Decisions | | | 671 | 100 | | | | | 671 | 100 |
| Assigned funds | | | 671 | 100 | | | | | 671 | 100 |
| Payments | | | 670 | 100 | | | | | 670 | 100 |
| Regular MS Contributions | | | | | | | | | | |
| | |
| Cotonou | A Envelope — National Allocations | | | | | | | | | | |
| Appropriations | 417 | | 8 861 | | 13 292 | | 15 729 | | 38 299 | |
| Decisions | 417 | 100 | 8 852 | 100 | 13 212 | 99 | 10 987 | 70 | 33 468 | 87 |
| Assigned funds | 417 | 100 | 8 834 | 100 | 12 641 | 95 | 6 944 | 44 | 28 836 | 75 |
| Payments | 417 | 100 | 8 800 | 99 | 11 113 | 84 | 2 960 | 19 | 23 290 | 61 |
| B Envelope — National Allocations | | | | | | | | | | |
| Appropriations | 233 | | 1 215 | | 2 019 | | 715 | | 4 181 | |
| Decisions | 233 | 100 | 1 213 | 100 | 2 017 | 100 | 699 | 98 | 4 161 | 100 |
| Assigned funds | 232 | 99 | 1 209 | 100 | 1 994 | 99 | 687 | 96 | 4 122 | 99 |
| Payments | 231 | 99 | 1 203 | 99 | 1 918 | 95 | 472 | 66 | 3 823 | 91 |
| Cotonou | Bridging facility | | | | | | | | | | |
| Appropriations | | | | | | | (0) | | (0) | |
| Decisions | | | | | | | | | | |
| Assigned funds | | | | | | | | | | |
| Payments | | | | | | | | | | |
| CDE, CTA and Parliamentary Assembly | | | | | | | | | | |
| Appropriations | | | 154 | | | | | | 154 | |
| Decisions | | | 154 | 100 | | | | | 154 | 100 |
| Assigned funds | | | 154 | 100 | | | | | 154 | 100 |
| Payments | | | 154 | 100 | | | | | 154 | 100 |
| Implementation Costs and Interests Revenues | | | | | | | | | | |
| Appropriations | 0 | | 240 | | 536 | | 1 073 | | 1 849 | |
| Decisions | | | 240 | 100 | 506 | 94 | 552 | 51 | 1 299 | 70 |
| Assigned funds | | | 240 | 100 | 503 | 94 | 499 | 47 | 1 243 | 67 |
| Payments | | | 240 | 100 | 501 | 93 | 464 | 43 | 1 204 | 65 |
| Intra-ACP allocations | | | | | | | | | | |
| Appropriations | | | 2 955 | | 3 132 | | 3 497 | | 9 584 | |
| Decisions | | | 2 949 | 100 | 3 128 | 100 | 2 344 | 67 | 8 421 | 88 |
| Assigned funds | | | 2 937 | 99 | 2 930 | 94 | 1 786 | 51 | 7 654 | 80 |
| Payments | | | 2 921 | 99 | 2 636 | 84 | 1 365 | 39 | 6 922 | 72 |
| Regional allocations | | | | | | | | | | |
| Appropriations | | | 812 | | 1 996 | | 5 767 | | 8 575 | |
| Decisions | | | 808 | 100 | 1 989 | 100 | 4 422 | 77 | 7 219 | 84 |
| Assigned funds | | | 792 | 98 | 1 864 | 93 | 3 514 | 61 | 6 170 | 72 |
| Payments | | | 774 | 95 | 1 442 | 72 | 943 | 16 | 3 160 | 37 |
| Special allocation R.D. Congo | | | | | | | | | | |
| Appropriations | | | 105 | | | | | | 105 | |
| Decisions | | | 105 | 100 | | | | | 105 | 100 |
| Assigned funds | | | 105 | 100 | | | | | 105 | 100 |
| Payments | | | 105 | 100 | | | | | 105 | 100 |
| Special allocation South Sudan | | | | | | | | | | |
| Appropriations | | | 267 | | | | | | 267 | |
| Decisions | | | 266 | 100 | | | | | 266 | 100 |
| Assigned funds | | | 218 | 82 | | | | | 218 | 82 |
| Payments | | | 184 | 69 | | | | | 184 | 69 |
| Cotonou | Special allocation Sudan | | | | | | | | | | |
| Appropriations | | | 110 | | | | | | 110 | |
| Decisions | | | 109 | 98 | | | | | 109 | 98 |
| Assigned funds | | | 105 | 96 | | | | | 105 | 96 |
| Payments | | | 90 | 81 | | | | | 90 | 81 |
| Voluntary contribution Peace facility | | | | | | | | | | |
| Appropriations | | | 39 | | | | | | 39 | |
| Decisions | | | 24 | 62 | | | | | 24 | 62 |
| Assigned funds | | | 24 | 62 | | | | | 24 | 62 |
| Payments | | | 24 | 62 | | | | | 24 | 62 |
| Regular MS Contributions | | | | | | | | | | |
| A Envelope — National Allocations | | | | | | | | | | |
| Appropriations | | | | | 187 | | 22 | | 209 | |
| Decisions | | | | | 185 | 99 | 20 | 92 | 205 | 98 |
| Assigned funds | | | | | 178 | 95 | 20 | 92 | 199 | 95 |
| Payments | | | | | 131 | 70 | | | 131 | 63 |
| Implementation Costs and Interests Revenues | | | | | | | | | | |
| Appropriations | | | | | 5 | | 1 | | 6 | |
| Decisions | | | | | 4 | 84 | | | 4 | 69 |
| Assigned funds | | | | | 2 | 45 | | | 2 | 37 |
| Payments | | | | | 1 | 28 | | | 1 | 23 |
| Intra-ACP allocations | | | | | | | | | | |
| Appropriations | | | | | 12 | | 1 | | 13 | |
| Decisions | | | | | 12 | 97 | 1 | 100 | 13 | 98 |
| Assigned funds | | | | | 11 | 91 | 1 | 100 | 12 | 92 |
| Payments | | | | | 11 | 88 | 1 | 100 | 12 | 89 |
| Co-financing | | | | | | | | | | |
| Cotonou | A Envelope — National Allocations | | | | | | | | | | |
| Appropriations | | | | | | | 1 | | 1 | |
| Decisions | | | | | | | 1 | 71 | 1 | 71 |
| Assigned funds | | | | | | | 1 | 71 | 1 | 71 |
| Payments | | | | | | | 1 | 52 | 1 | 52 |
| EC Internal SLA | | | | | | | | | | |
| | |
| | Appropriations | 8 | % | 9 | % | 10 | % | 11 | % | TOTAL | % |
| (9) | (9) | (9) | (9) | (9) |
| Cotonou | Country reserve | | | | | 0 | | 0 | | 0 | |
| Intra-ACP Reserve | | | | | 0 | | 93 | | 93 | |
| National allocations Reserve A Envelope Stabex | | | | | (0) | | 0 | | 0 | |
| NIP/RIP reserve | | | | | 0 | | 2 515 | | 2 515 | |
| Regional allocations reserve | | | | | 0 | | | | 0 | |
| Mobilisable reserves | | | | | | | | | | |
| Non-mobilisable reserve | | | | | 309 | | 206 | | 515 | |
| Non-mobilisable reserve | | | | | | | | | | |
| | | 8 | % | 9 | % | 10 | % | 11 | % | TOTAL | % |
| (9) | (9) | (9) | (9) | (9) |
| | Appropriations | 10 385 | | 15 430 | | 21 488 | | 29 621 | | 76 924 | |
| Decisions | 10 382 | 100 | 15 391 | 100 | 21 052 | 98 | 19 027 | 64 | 65 852 | 86 |
| Assigned funds | 10 376 | 100 | 15 289 | 99 | 20 125 | 94 | 13 453 | 45 | 59 242 | 77 |
| Payments | 10 375 | 100 | 15 164 | 98 | 17 753 | 83 | 6 206 | 21 | 49 497 | 64 |
| TOTAL: ALL ALLOCATIONS | | | | | | | | | | |

(EUR millions)

EDF

8

%

9

%

10

%

11

%

TOTAL

%

(9)

9

(9)

9

(9)

9

(9)

9

(9)

9

Lomé

Lomé

Sundry Income

Sundry Income

Appropriations

35

35

Decisions

35

100

35

100

Assigned funds

35

100

35

100

Payments

35

100

35

100

Total indicative programmes

Total indicative programmes

Appropriations

4 989

4 989

Decisions

4 987

100

4 987

100

Assigned funds

4 986

100

4 986

100

Payments

4 985

100

4 985

100

Total Non-Programmable Aid

Total Non-Programmable Aid

Appropriations

4 711

4 711

Decisions

4 710

100

4 710

100

Assigned funds

4 706

100

4 706

100

Payments

4 706

100

4 706

100

Transfers from other funds

Transfers from other funds

Appropriations

672

672

Decisions

671

100

671

100

Assigned funds

671

100

671

100

Payments

670

100

670

100

Regular MS Contributions

Regular MS Contributions

Cotonou

Cotonou

A Envelope — National Allocations

A Envelope — National Allocations

Appropriations

417

8 861

13 292

15 729

38 299

Decisions

417

100

8 852

100

13 212

99

10 987

70

33 468

87

Assigned funds

417

100

8 834

100

12 641

95

6 944

44

28 836

75

Payments

417

100

8 800

99

11 113

84

2 960

19

23 290

61

B Envelope — National Allocations

B Envelope — National Allocations

Appropriations

233

1 215

2 019

715

4 181

Decisions

233

100

1 213

100

2 017

100

699

98

4 161

100

Assigned funds

232

99

1 209

100

1 994

99

687

96

4 122

99

Payments

231

99

1 203

99

1 918

95

472

66

3 823

91

Cotonou

Cotonou

Bridging facility

Bridging facility

Appropriations

(0)

(0)

Decisions

Assigned funds

Payments

CDE, CTA and Parliamentary Assembly

CDE, CTA and Parliamentary Assembly

Appropriations

154

154

Decisions

154

100

154

100

Assigned funds

154

100

154

100

Payments

154

100

154

100

Implementation Costs and Interests Revenues

Implementation Costs and Interests Revenues

Appropriations

0

240

536

1 073

1 849

Decisions

240

100

506

94

552

51

1 299

70

Assigned funds

240

100

503

94

499

47

1 243

67

Payments

240

100

501

93

464

43

1 204

65

Intra-ACP allocations

Intra-ACP allocations

Appropriations

2 955

3 132

3 497

9 584

Decisions

2 949

100

3 128

100

2 344

67

8 421

88

Assigned funds

2 937

99

2 930

94

1 786

51

7 654

80

Payments

2 921

99

2 636

84

1 365

39

6 922

72

Regional allocations

Regional allocations

Appropriations

812

1 996

5 767

8 575

Decisions

808

100

1 989

100

4 422

77

7 219

84

Assigned funds

792

98

1 864

93

3 514

61

6 170

72

Payments

774

95

1 442

72

943

16

3 160

37

Special allocation R.D. Congo

Special allocation R.D. Congo

Appropriations

105

105

Decisions

105

100

105

100

Assigned funds

105

100

105

100

Payments

105

100

105

100

Special allocation South Sudan

Special allocation South Sudan

Appropriations

267

267

Decisions

266

100

266

100

Assigned funds

218

82

218

82

Payments

184

69

184

69

Cotonou

Cotonou

Special allocation Sudan

Special allocation Sudan

Appropriations

110

110

Decisions

109

98

109

98

Assigned funds

105

96

105

96

Payments

90

81

90

81

Voluntary contribution Peace facility

Voluntary contribution Peace facility

Appropriations

39

39

Decisions

24

62

24

62

Assigned funds

24

62

24

62

Payments

24

62

24

62

Regular MS Contributions

Regular MS Contributions

A Envelope — National Allocations

A Envelope — National Allocations

Appropriations

187

22

209

Decisions

185

99

20

92

205

98

Assigned funds

178

95

20

92

199

95

Payments

131

70

131

63

Implementation Costs and Interests Revenues

Implementation Costs and Interests Revenues

Appropriations

5

1

6

Decisions

4

84

4

69

Assigned funds

2

45

2

37

Payments

1

28

1

23

Intra-ACP allocations

Intra-ACP allocations

Appropriations

12

1

13

Decisions

12

97

1

100

13

98

Assigned funds

11

91

1

100

12

92

Payments

11

88

1

100

12

89

Co-financing

Co-financing

Cotonou

Cotonou

A Envelope — National Allocations

A Envelope — National Allocations

Appropriations

1

1

Decisions

1

71

1

71

Assigned funds

1

71

1

71

Payments

1

52

1

52

EC Internal SLA

EC Internal SLA

Appropriations

8

%

9

%

10

%

11

%

TOTAL

%

(9)

9

(9)

9

(9)

9

(9)

9

(9)

9

Cotonou

Cotonou

Country reserve

0

0

0

0

0

0

Intra-ACP Reserve

0

0

93

93

93

93

National allocations Reserve A Envelope Stabex

(0)

(0)

0

0

0

0

NIP/RIP reserve

0

0

2 515

2 515

2 515

2 515

Regional allocations reserve

0

0

0

0

Mobilisable reserves

Mobilisable reserves

Non-mobilisable reserve

309

309

206

206

515

515

Non-mobilisable reserve

Non-mobilisable reserve

8

%

9

%

10

%

11

%

TOTAL

%

(9)

9

(9)

9

(9)

9

(9)

9

(9)

9

Appropriations

10 385

15 430

21 488

29 621

76 924

Decisions

10 382

100

15 391

100

21 052

98

19 027

64

65 852

86

Assigned funds

10 376

100

15 289

99

20 125

94

13 453

45

59 242

77

Payments

10 375

100

15 164

98

17 753

83

6 206

21

49 497

64

TOTAL: ALL ALLOCATIONS

TOTAL: ALL ALLOCATIONS

Table 2.3

Table 2.3

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

CLASS OF AID

CLASS OF AID

ACP + PTOM — Eight EDF

ACP + PTOM — Eight EDF

| (EUR millions) |
| --- |
| | | CREDITS | DECISIONS | ASSIGNED FUNDS | PAYMENTS |
| AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % |
| (1) | (2) | | (2):(1) | (3) | | (3):(2) | (4) | | (4):(3) |
| Lomé | ACP


  Regular MS Contributions | | | | | | | | | | |
| Utilisation of interest income | 35 | 35 | | 100 | 35 | | 100 | 35 | | 100 |
| SUB TOTAL: SUNDRY INCOME | 35 | 35 | | 100 | 35 | | 100 | 35 | | 100 |
| Total indicative programmes | 4 954 | 4 951 | (5) | 100 | 4 950 | (2) | 100 | 4 950 | (1) | 100 |
| SUB TOTAL: TOTAL INDICATIVE PROGRAMMES | 4 954 | 4 951 | (5) | 100 | 4 950 | (2) | 100 | 4 950 | (1) | 100 |
| Aid for refugees | 100 | 100 | (0) | 100 | 100 | (0) | 100 | 100 | | 100 |
| Emergency aid (Lomé) | 136 | 136 | | 100 | 136 | | 100 | 136 | | 100 |
| Heavily indebted poor countries (Lomé) | 1 060 | 1 060 | | 100 | 1 060 | | 100 | 1 060 | | 100 |
| Interest-rate subsidies | 69 | 69 | (3) | 100 | 68 | (0) | 100 | 68 | (0) | 100 |
| Risk capital | 1 015 | 1 015 | | 100 | 1 012 | | 100 | 1 012 | | 100 |
| Stabex | 723 | 723 | (0) | 100 | 722 | (0) | 100 | 722 | | 100 |
| Structural adjustment | 1 497 | 1 497 | 0 | 100 | 1 497 | (0) | 100 | 1 497 | | 100 |
| Sysmin | 101 | 101 | | 100 | 101 | | 100 | 101 | | 100 |
| SUB TOTAL: TOTAL NON-PROGRAMMABLE AID | 4 700 | 4 699 | (4) | 100 | 4 695 | (1) | 100 | 4 695 | (0) | 100 |
| Cotonou | ACP


  Regular MS Contributions | | | | | | | | | | |
| A Envelope — National Allocations | 417 | 417 | | 100 | 417 | | 100 | 417 | | 100 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 417 | 417 | | 100 | 417 | | 100 | 417 | | 100 |
| B Envelope — National Allocations | 233 | | | | | | | | | |
| Compensation export earnings | | 233 | (0) | | 232 | (0) | 99 | 231 | | 100 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 233 | 233 | (0) | 100 | 232 | (0) | 99 | 231 | | 100 |
| Interests and other receipts | 0 | | | | | | | | | |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 0 | | | | | | | | | |
| | TOTAL ACP (A) | 10 339 | 10 336 | (9) | 100 | 10 330 | (3) | 100 | 10 329 | (1) | 100 |
| Lomé | OCTs


  Regular MS Contributions | | | | | | | | | | |
| Total indicative programmes | 35 | 35 | (1) | 100 | 35 | | 100 | 35 | | 100 |
| SUB TOTAL: TOTAL INDICATIVE PROGRAMMES | 35 | 35 | (1) | 100 | 35 | | 100 | 35 | | 100 |
| Interest-rate subsidies | 1 | 1 | | 100 | 1 | | 100 | 1 | | 100 |
| Risk capital | 6 | 6 | | 100 | 6 | | 100 | 6 | | 100 |
| Stabex | 1 | 1 | | 100 | 1 | | 100 | 1 | | 100 |
| Sysmin | 2 | 2 | | 100 | 2 | | 100 | 2 | | 100 |
| SUB TOTAL: TOTAL NON-PROGRAMMABLE AID | 10 | 10 | | 100 | 10 | | 100 | 10 | | 100 |
| | TOTAL OCTs | 46 | 46 | (1) | 100 | 46 | | 100 | 46 | | 100 |
| | TOTAL: ACP+OCTs (A+B) | 10 385 | 10 382 | (9) | 100 | 10 376 | (3) | 100 | 10 375 | (1) | 100 |

(EUR millions)

CREDITS

DECISIONS

ASSIGNED FUNDS

PAYMENTS

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

(1)

(2)

(2):(1)

(3)

(3):(2)

(4)

(4):(3)

Lomé

Lomé

ACP

ACP

Regular MS Contributions

Regular MS Contributions

Utilisation of interest income

35

35

100

35

100

35

100

SUB TOTAL: SUNDRY INCOME

SUB TOTAL: SUNDRY INCOME

35

35

35

35

100

100

35

35

100

100

35

35

100

100

Total indicative programmes

4 954

4 951

(5)

100

4 950

(2)

100

4 950

(1)

100

SUB TOTAL: TOTAL INDICATIVE PROGRAMMES

SUB TOTAL: TOTAL INDICATIVE PROGRAMMES

4 954

4 954

4 951

4 951

(5)

(5)

100

100

4 950

4 950

(2)

(2)

100

100

4 950

4 950

(1)

(1)

100

100

Aid for refugees

100

100

(0)

100

100

(0)

100

100

100

Emergency aid (Lomé)

136

136

100

136

100

136

100

Heavily indebted poor countries (Lomé)

1 060

1 060

100

1 060

100

1 060

100

Interest-rate subsidies

69

69

(3)

100

68

(0)

100

68

(0)

100

Risk capital

1 015

1 015

100

1 012

100

1 012

100

Stabex

723

723

(0)

100

722

(0)

100

722

100

Structural adjustment

1 497

1 497

0

100

1 497

(0)

100

1 497

100

Sysmin

101

101

100

101

100

101

100

SUB TOTAL: TOTAL NON-PROGRAMMABLE AID

SUB TOTAL: TOTAL NON-PROGRAMMABLE AID

4 700

4 700

4 699

4 699

(4)

(4)

100

100

4 695

4 695

(1)

(1)

100

100

4 695

4 695

(0)

(0)

100

100

Cotonou

Cotonou

ACP

ACP

Regular MS Contributions

Regular MS Contributions

A Envelope — National Allocations

417

417

100

417

100

417

100

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

417

417

417

417

100

100

417

417

100

100

417

417

100

100

B Envelope — National Allocations

233

Compensation export earnings

233

(0)

232

(0)

99

231

100

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

233

233

233

233

(0)

(0)

100

100

232

232

(0)

(0)

99

99

231

231

100

100

Interests and other receipts

0

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

0

0

TOTAL ACP (A)

TOTAL ACP (A)

10 339

10 339

10 336

10 336

(9)

(9)

100

100

10 330

10 330

(3)

(3)

100

100

10 329

10 329

(1)

(1)

100

100

Lomé

Lomé

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

Total indicative programmes

35

35

(1)

100

35

100

35

100

SUB TOTAL: TOTAL INDICATIVE PROGRAMMES

SUB TOTAL: TOTAL INDICATIVE PROGRAMMES

35

35

35

35

(1)

(1)

100

100

35

35

100

100

35

35

100

100

Interest-rate subsidies

1

1

100

1

100

1

100

Risk capital

6

6

100

6

100

6

100

Stabex

1

1

100

1

100

1

100

Sysmin

2

2

100

2

100

2

100

SUB TOTAL: TOTAL NON-PROGRAMMABLE AID

SUB TOTAL: TOTAL NON-PROGRAMMABLE AID

10

10

10

10

100

100

10

10

100

100

10

10

100

100

TOTAL OCTs

TOTAL OCTs

46

46

46

46

(1)

(1)

100

100

46

46

100

100

46

46

100

100

TOTAL: ACP+OCTs (A+B)

TOTAL: ACP+OCTs (A+B)

10 385

10 385

10 382

10 382

(9)

(9)

100

100

10 376

10 376

(3)

(3)

100

100

10 375

10 375

(1)

(1)

100

100

Table 2.4

Table 2.4

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

CLASS OF AID

CLASS OF AID

ACP + PTOM — Ninth EDF

ACP + PTOM — Ninth EDF

| | (EUR millions) |
| --- | --- |
| | | CREDITS | DECISIONS | ASSIGNED FUNDS | PAYMENTS |
| AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % |
| (1) | (2) | | (2):(1) | (3) | | (3):(2) | (4) | | (4):(3) |
| Lomé | ACP | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Transfers from 6th EDF — Lomé | 20 | 20 | (0) | 100 | 20 | (0) | 100 | 20 | | 100 |
| Transfers from 7th EDF — Lomé | 649 | 648 | (3) | 100 | 647 | (1) | 100 | 647 | (0) | 100 |
| SUB TOTAL: TRANSFERS FROM OTHER FUNDS | 669 | 668 | (3) | 100 | 668 | (1) | 100 | 667 | (0) | 100 |
| Cotonou | ACP | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| A Envelope — National Allocations | 8 624 | 8 615 | (16) | 100 | 8 599 | (6) | 100 | 8 566 | (3) | 100 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 8 624 | 8 615 | (16) | 100 | 8 599 | (6) | 100 | 8 566 | (3) | 100 |
| B Envelope — National Allocations | 1 210 | | | | | | | | | |
| Compensation export earnings | | 148 | (1) | | 148 | (1) | 100 | 148 | (1) | 100 |
| Emergency aid | | 1 050 | (1) | | 1 045 | 1 | 100 | 1 040 | (0) | 99 |
| Heavily indebted poor countries | | 11 | | | 11 | | 100 | 11 | | 100 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 1 210 | 1 208 | (2) | 100 | 1 204 | 0 | 100 | 1 198 | (1) | 100 |
| Cotonou | CDE, CTA and Parliamentary Assembly | 154 | 154 | | 100 | 154 | | 100 | 154 | | 100 |
| SUB TOTAL: CDE, CTA AND PARLIAMENTARY ASSEMBLY | 154 | 154 | | 100 | 154 | | 100 | 154 | | 100 |
| Implementation costs | 177 | 177 | | 100 | 177 | 0 | 100 | 177 | 1 | 100 |
| Interests and other receipts | 63 | 63 | | 100 | 63 | | 100 | 63 | | 100 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 240 | 240 | | 100 | 240 | 0 | 100 | 239 | 1 | 100 |
| Other Intra-ACP allocations | 2 602 | 2 595 | (9) | 100 | 2 584 | (6) | 100 | 2 567 | (3) | 99 |
| Peace facility | 354 | 354 | | 100 | 353 | | 100 | 353 | | 100 |
| SUB TOTAL: INTRA-ACP ALLOCATIONS | 2 955 | 2 949 | (9) | 100 | 2 937 | (6) | 100 | 2 921 | (3) | 99 |
| Regional allocations | 765 | 763 | (6) | 100 | 747 | (5) | 98 | 729 | 3 | 98 |
| SUB TOTAL: REGIONAL ALLOCATIONS | 765 | 763 | (6) | 100 | 747 | (5) | 98 | 729 | 3 | 98 |
| Special allocation R.D. Congo | 105 | 105 | | 100 | 105 | | 100 | 105 | | 100 |
| SUB TOTAL: SPECIAL ALLOCATION R.D. CONGO | 105 | 105 | | 100 | 105 | | 100 | 105 | | 100 |
| Special allocation South Sudan | 267 | 266 | 0 | 100 | 218 | 1 | 82 | 184 | 107 | 84 |
| SUB TOTAL: SPECIAL ALLOCATION SOUTH SUDAN | 267 | 266 | 0 | 100 | 218 | 1 | 82 | 184 | 107 | 84 |
| Special allocation Sudan | 110 | 109 | 0 | 98 | 105 | 0 | 97 | 90 | 9 | 85 |
| SUB TOTAL: SPECIAL ALLOCATION SUDAN | 110 | 109 | 0 | 98 | 105 | 0 | 97 | 90 | 9 | 85 |
| Voluntary contribution Peace facility | 39 | 24 | | 62 | 24 | | 100 | 24 | | 100 |
| SUB TOTAL: VOLUNTARY CONTRIBUTION PEACE FACILITY | 39 | 24 | | 62 | 24 | | 100 | 24 | | 100 |
| | TOTAL: ACP (A) | 15 138 | 15 101 | (35) | 100 | 15 001 | (17) | 99 | 14 876 | 112 | 99 |
| Lomé | OCTs | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Transfers from 6th EDF — Lomé | 0 | 0 | | 100 | 0 | | 100 | 0 | | 100 |
| Transfers from 7th EDF — Lomé | 3 | 3 | | 100 | 3 | | 100 | 3 | | 100 |
| SUB TOTAL: TRANSFERS FROM OTHER FUNDS | 3 | 3 | | 100 | 3 | | 100 | 3 | | 100 |
| Cotonou | OCTs | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| A Envelope — National Allocations | 237 | 237 | (0) | 100 | 235 | (2) | 99 | 235 | (0) | 100 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 237 | 237 | (0) | 100 | 235 | (2) | 99 | 235 | (0) | 100 |
| B Envelope — National Allocations | 4 | | | | | | | | | |
| Emergency aid | | 4 | | | 4 | | 100 | 4 | | 100 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 4 | 4 | | 100 | 4 | | 100 | 4 | | 100 |
| Studies/Technical assistance OCTs | 1 | 1 | | 100 | 1 | | 100 | 1 | | 100 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 1 | 1 | | 100 | 1 | | 100 | 1 | | 100 |
| Regional allocations | 47 | 45 | (3) | 96 | 45 | (1) | 100 | 45 | (1) | 99 |
| SUB TOTAL: REGIONAL ALLOCATIONS | 47 | 45 | (3) | 96 | 45 | (1) | 100 | 45 | (1) | 99 |
| | TOTAL: OCTs | 292 | 290 | (3) | 99 | 288 | (3) | 99 | 288 | (1) | 100 |
| | TOTAL: ACP+OCTs (A+B) | 15 430 | 15 391 | (38) | 100 | 15 289 | (20) | 99 | 15 164 | 111 | 99 |

(EUR millions)

CREDITS

DECISIONS

ASSIGNED FUNDS

PAYMENTS

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

(1)

(2)

(2):(1)

(3)

(3):(2)

(4)

(4):(3)

Lomé

Lomé

ACP

ACP

Regular MS Contributions

Regular MS Contributions

Transfers from 6th EDF — Lomé

20

20

(0)

100

20

(0)

100

20

100

Transfers from 7th EDF — Lomé

649

648

(3)

100

647

(1)

100

647

(0)

100

SUB TOTAL: TRANSFERS FROM OTHER FUNDS

SUB TOTAL: TRANSFERS FROM OTHER FUNDS

669

669

668

668

(3)

(3)

100

100

668

668

(1)

(1)

100

100

667

667

(0)

(0)

100

100

Cotonou

Cotonou

ACP

ACP

Regular MS Contributions

Regular MS Contributions

A Envelope — National Allocations

8 624

8 615

(16)

100

8 599

(6)

100

8 566

(3)

100

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

8 624

8 624

8 615

8 615

(16)

(16)

100

100

8 599

8 599

(6)

(6)

100

100

8 566

8 566

(3)

(3)

100

100

B Envelope — National Allocations

1 210

Compensation export earnings

148

(1)

148

(1)

100

148

(1)

100

Emergency aid

1 050

(1)

1 045

1

100

1 040

(0)

99

Heavily indebted poor countries

11

11

100

11

100

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

1 210

1 210

1 208

1 208

(2)

(2)

100

100

1 204

1 204

0

0

100

100

1 198

1 198

(1)

(1)

100

100

Cotonou

Cotonou

CDE, CTA and Parliamentary Assembly

154

154

100

154

100

154

100

SUB TOTAL: CDE, CTA AND PARLIAMENTARY ASSEMBLY

SUB TOTAL: CDE, CTA AND PARLIAMENTARY ASSEMBLY

154

154

154

154

100

100

154

154

100

100

154

154

100

100

Implementation costs

177

177

100

177

0

100

177

1

100

Interests and other receipts

63

63

100

63

100

63

100

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

240

240

240

240

100

100

240

240

0

0

100

100

239

239

1

1

100

100

Other Intra-ACP allocations

2 602

2 595

(9)

100

2 584

(6)

100

2 567

(3)

99

Peace facility

354

354

100

353

100

353

100

SUB TOTAL: INTRA-ACP ALLOCATIONS

SUB TOTAL: INTRA-ACP ALLOCATIONS

2 955

2 955

2 949

2 949

(9)

(9)

100

100

2 937

2 937

(6)

(6)

100

100

2 921

2 921

(3)

(3)

99

99

Regional allocations

765

763

(6)

100

747

(5)

98

729

3

98

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

765

765

763

763

(6)

(6)

100

100

747

747

(5)

(5)

98

98

729

729

3

3

98

98

Special allocation R.D. Congo

105

105

100

105

100

105

100

SUB TOTAL: SPECIAL ALLOCATION R.D. CONGO

SUB TOTAL: SPECIAL ALLOCATION R.D. CONGO

105

105

105

105

100

100

105

105

100

100

105

105

100

100

Special allocation South Sudan

267

266

0

100

218

1

82

184

107

84

SUB TOTAL: SPECIAL ALLOCATION SOUTH SUDAN

SUB TOTAL: SPECIAL ALLOCATION SOUTH SUDAN

267

267

266

266

0

0

100

100

218

218

1

1

82

82

184

184

107

107

84

84

Special allocation Sudan

110

109

0

98

105

0

97

90

9

85

SUB TOTAL: SPECIAL ALLOCATION SUDAN

SUB TOTAL: SPECIAL ALLOCATION SUDAN

110

110

109

109

0

0

98

98

105

105

0

0

97

97

90

90

9

9

85

85

Voluntary contribution Peace facility

39

24

62

24

100

24

100

SUB TOTAL: VOLUNTARY CONTRIBUTION PEACE FACILITY

SUB TOTAL: VOLUNTARY CONTRIBUTION PEACE FACILITY

39

39

24

24

62

62

24

24

100

100

24

24

100

100

TOTAL: ACP (A)

TOTAL: ACP (A)

15 138

15 138

15 101

15 101

(35)

(35)

100

100

15 001

15 001

(17)

(17)

99

99

14 876

14 876

112

112

99

99

Lomé

Lomé

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

Transfers from 6th EDF — Lomé

0

0

100

0

100

0

100

Transfers from 7th EDF — Lomé

3

3

100

3

100

3

100

SUB TOTAL: TRANSFERS FROM OTHER FUNDS

SUB TOTAL: TRANSFERS FROM OTHER FUNDS

3

3

3

3

100

100

3

3

100

100

3

3

100

100

Cotonou

Cotonou

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

A Envelope — National Allocations

237

237

(0)

100

235

(2)

99

235

(0)

100

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

237

237

237

237

(0)

(0)

100

100

235

235

(2)

(2)

99

99

235

235

(0)

(0)

100

100

B Envelope — National Allocations

4

Emergency aid

4

4

100

4

100

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

4

4

4

4

100

100

4

4

100

100

4

4

100

100

Studies/Technical assistance OCTs

1

1

100

1

100

1

100

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

1

1

1

1

100

100

1

1

100

100

1

1

100

100

Regional allocations

47

45

(3)

96

45

(1)

100

45

(1)

99

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

47

47

45

45

(3)

(3)

96

96

45

45

(1)

(1)

100

100

45

45

(1)

(1)

99

99

TOTAL: OCTs

TOTAL: OCTs

292

292

290

290

(3)

(3)

99

99

288

288

(3)

(3)

99

99

288

288

(1)

(1)

100

100

TOTAL: ACP+OCTs (A+B)

TOTAL: ACP+OCTs (A+B)

15 430

15 430

15 391

15 391

(38)

(38)

100

100

15 289

15 289

(20)

(20)

99

99

15 164

15 164

111

111

99

99

Table 2.5

Table 2.5

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

CLASS OF AID

CLASS OF AID

ACP + PTOM — 10th EDF

ACP + PTOM — 10th EDF

| (EUR millions) |
| --- |
| | CREDITS | DECISIONS | ASSIGNED FUNDS | PAYMENTS |
| AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % |
| (1) | (2) | | (2):(1) | (3) | | (3):(2) | (4) | | (4):(3) |
| ACP | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 13 100 | 13 021 | (200) | 99 | 12 477 | 176 | 96 | 10 983 | 739 | 88 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 13 100 | 13 021 | (200) | 99 | 12 477 | 176 | 96 | 10 983 | 739 | 88 |
| B Envelope — National Allocations | 2 004 | | | | | | | | | |
| Compensation export earnings | | 204 | (0) | | 199 | 6 | 97 | 183 | 4 | 92 |
| Emergency aid | | 844 | (6) | | 836 | 5 | 99 | 791 | 24 | 95 |
| Heavily indebted poor countries | | 49 | | | 49 | 0 | 100 | 49 | 0 | 100 |
| Other chocs with budgetary impact | | 905 | (0) | | 897 | 1 | 99 | 882 | 10 | 98 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 2 004 | 2 002 | (6) | 100 | 1 980 | 12 | 99 | 1 904 | 38 | 96 |
| Implementation costs | 445 | 433 | 1 | 97 | 431 | 2 | 100 | 429 | 2 | 100 |
| Interests and other receipts | 85 | 68 | (1) | 80 | 67 | (0) | 98 | 67 | 0 | 100 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 530 | 501 | 1 | 94 | 498 | 2 | 99 | 496 | 2 | 100 |
| Institutional and support expenditure | 232 | 232 | (0) | 100 | 230 | (1) | 99 | 211 | (0) | 91 |
| Other Intra-ACP allocations | 1 886 | 1 882 | (7) | 100 | 1 828 | 4 | 97 | 1 611 | 119 | 88 |
| Peace facility | 1 014 | 1 014 | 220 | 100 | 872 | 233 | 86 | 814 | 198 | 93 |
| SUB TOTAL: INTRA-ACP ALLOCATIONS | 3 132 | 3 128 | 213 | 100 | 2 930 | 235 | 94 | 2 636 | 317 | 90 |
| Regional allocations | 1 956 | 1 950 | (10) | 100 | 1 826 | 49 | 94 | 1 410 | 145 | 77 |
| SUB TOTAL: REGIONAL ALLOCATIONS | 1 956 | 1 950 | (10) | 100 | 1 826 | 49 | 94 | 1 410 | 145 | 77 |
| Co-financing | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 187 | 185 | (0) | 99 | 178 | 43 | 97 | 131 | 16 | 74 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 187 | 185 | (0) | 99 | 178 | 43 | 97 | 131 | 16 | 74 |
| Implementation costs | 5 | 4 | | 84 | 2 | 0 | 53 | 1 | 0 | 63 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 5 | 4 | | 84 | 2 | 0 | 53 | 1 | 0 | 63 |
| Other Intra-ACP allocations | 12 | 11 | 0 | 97 | 10 | (0) | 94 | 10 | 0 | 96 |
| Peace facility | 1 | 1 | | 100 | 1 | | 99 | 1 | | 100 |
| SUB TOTAL: INTRA-ACP ALLOCATIONS | 12 | 12 | 0 | 97 | 11 | (0) | 94 | 11 | 0 | 96 |
| Non-mobilisable reserve | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| Non-mobilisable reserve | 286 | | | | | | | | | |
| SUB TOTAL: NON-MOBILISABLE RESERVE | 286 | | | | | | | | | |
| OCTs | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 192 | 191 | (2) | 99 | 164 | 29 | 86 | 131 | 7 | 79 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 192 | 191 | (2) | 99 | 164 | 29 | 86 | 131 | 7 | 79 |
| B Envelope — National Allocations | 15 | | | | | | | | | |
| Emergency aid | | 9 | (0) | | 8 | 2 | 95 | 7 | 0 | 84 |
| Other chocs with budgetary impact | | 6 | | | 6 | | 100 | 6 | | 100 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 15 | 15 | (0) | 100 | 14 | 2 | 97 | 13 | 0 | 91 |
| Studies/Technical assistance OCTs | 5 | 5 | (0) | 100 | 5 | (0) | 99 | 5 | 0 | 98 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 5 | 5 | (0) | 100 | 5 | (0) | 99 | 5 | 0 | 98 |
| Regional allocations | 40 | 40 | 0 | 100 | 38 | 3 | 97 | 32 | 12 | 84 |
| SUB TOTAL: REGIONAL ALLOCATIONS | 40 | 40 | 0 | 100 | 38 | 3 | 97 | 32 | 12 | 84 |
| Non-mobilisable reserve | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| Non-mobilisable reserve | 23 | | | | | | | | | |
| SUB TOTAL: NON-MOBILISABLE RESERVE | 23 | | | | | | | | | |
| TOTAL: ACP+OCTs (INCL. RESERVES) (A+B) | 21 488 | 21 052 | (5) | 98 | 20 125 | 550 | 96 | 17 753 | 1 277 | 88 |

(EUR millions)

CREDITS

DECISIONS

ASSIGNED FUNDS

PAYMENTS

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

(1)

(2)

(2):(1)

(3)

(3):(2)

(4)

(4):(3)

ACP

ACP

Regular MS Contributions

Regular MS Contributions

Allocations

Allocations

A Envelope — National Allocations

13 100

13 021

(200)

99

12 477

176

96

10 983

739

88

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

13 100

13 100

13 021

13 021

(200)

(200)

99

99

12 477

12 477

176

176

96

96

10 983

10 983

739

739

88

88

B Envelope — National Allocations

2 004

Compensation export earnings

204

(0)

199

6

97

183

4

92

Emergency aid

844

(6)

836

5

99

791

24

95

Heavily indebted poor countries

49

49

0

100

49

0

100

Other chocs with budgetary impact

905

(0)

897

1

99

882

10

98

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

2 004

2 004

2 002

2 002

(6)

(6)

100

100

1 980

1 980

12

12

99

99

1 904

1 904

38

38

96

96

Implementation costs

445

433

1

97

431

2

100

429

2

100

Interests and other receipts

85

68

(1)

80

67

(0)

98

67

0

100

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

530

530

501

501

1

1

94

94

498

498

2

2

99

99

496

496

2

2

100

100

Institutional and support expenditure

232

232

(0)

100

230

(1)

99

211

(0)

91

Other Intra-ACP allocations

1 886

1 882

(7)

100

1 828

4

97

1 611

119

88

Peace facility

1 014

1 014

220

100

872

233

86

814

198

93

SUB TOTAL: INTRA-ACP ALLOCATIONS

SUB TOTAL: INTRA-ACP ALLOCATIONS

3 132

3 132

3 128

3 128

213

213

100

100

2 930

2 930

235

235

94

94

2 636

2 636

317

317

90

90

Regional allocations

1 956

1 950

(10)

100

1 826

49

94

1 410

145

77

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

1 956

1 956

1 950

1 950

(10)

(10)

100

100

1 826

1 826

49

49

94

94

1 410

1 410

145

145

77

77

Co-financing

Co-financing

Allocations

Allocations

A Envelope — National Allocations

187

185

(0)

99

178

43

97

131

16

74

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

187

187

185

185

(0)

(0)

99

99

178

178

43

43

97

97

131

131

16

16

74

74

Implementation costs

5

4

84

2

0

53

1

0

63

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

5

5

4

4

84

84

2

2

0

0

53

53

1

1

0

0

63

63

Other Intra-ACP allocations

12

11

0

97

10

(0)

94

10

0

96

Peace facility

1

1

100

1

99

1

100

SUB TOTAL: INTRA-ACP ALLOCATIONS

SUB TOTAL: INTRA-ACP ALLOCATIONS

12

12

12

12

0

0

97

97

11

11

(0)

(0)

94

94

11

11

0

0

96

96

Non-mobilisable reserve

Non-mobilisable reserve

Reserves

Reserves

Non-mobilisable reserve

286

SUB TOTAL: NON-MOBILISABLE RESERVE

SUB TOTAL: NON-MOBILISABLE RESERVE

286

286

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

Allocations

Allocations

A Envelope — National Allocations

192

191

(2)

99

164

29

86

131

7

79

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

192

192

191

191

(2)

(2)

99

99

164

164

29

29

86

86

131

131

7

7

79

79

B Envelope — National Allocations

15

Emergency aid

9

(0)

8

2

95

7

0

84

Other chocs with budgetary impact

6

6

100

6

100

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

15

15

15

15

(0)

(0)

100

100

14

14

2

2

97

97

13

13

0

0

91

91

Studies/Technical assistance OCTs

5

5

(0)

100

5

(0)

99

5

0

98

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

5

5

5

5

(0)

(0)

100

100

5

5

(0)

(0)

99

99

5

5

0

0

98

98

Regional allocations

40

40

0

100

38

3

97

32

12

84

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

40

40

40

40

0

0

100

100

38

38

3

3

97

97

32

32

12

12

84

84

Non-mobilisable reserve

Non-mobilisable reserve

Reserves

Reserves

Non-mobilisable reserve

23

SUB TOTAL: NON-MOBILISABLE RESERVE

SUB TOTAL: NON-MOBILISABLE RESERVE

23

23

TOTAL: ACP+OCTs (INCL. RESERVES) (A+B)

TOTAL: ACP+OCTs (INCL. RESERVES) (A+B)

21 488

21 488

21 052

21 052

(5)

(5)

98

98

20 125

20 125

550

550

96

96

17 753

17 753

1 277

1 277

88

88

Table 2.6

Table 2.6

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

EDF AGGREGATED ACCOUNTS AT 31 DECEMBER 2017

CLASS OF AID

CLASS OF AID

ACP + PTOM — 11th EDF

ACP + PTOM — 11th EDF

| (EUR millions) |
| --- |
| | CREDITS | DECISIONS | ASSIGNED FUNDS | PAYMENTS |
| AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % | AGGREG. | ANNUAL | % |
| (1) | (2) | | (2):(1) | (3) | | (3):(2) | (4) | | (4):(3) |
| ACP | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 15 540 | 10 890 | 2 960 | 70 | 6 856 | 3 106 | 63 | 2 931 | 1 414 | 43 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 15 540 | 10 890 | 2 960 | 70 | 6 856 | 3 106 | 63 | 2 931 | 1 414 | 43 |
| B Envelope — National Allocations | 715 | | | | | | | | | |
| Emergency aid | | 590 | 91 | | 578 | 247 | 98 | 443 | 205 | 77 |
| Other chocs with budgetary impact | | 109 | 0 | | 109 | 100 | 100 | 29 | 24 | 26 |
| SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS | 715 | 699 | 91 | 98 | 687 | 347 | 98 | 472 | 229 | 69 |
| Bridging facility | 0 | | | | | | | | | |
| SUB TOTAL: BRIDGING FACILITY | 0 | | | | | | | | | |
| Implementation costs | 1 053 | 538 | 164 | 51 | 490 | 161 | 91 | 456 | 153 | 93 |
| Interests and other receipts | 16 | 10 | 2 | 62 | 6 | 0 | 63 | 6 | 0 | 93 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 1 068 | 548 | 166 | 51 | 496 | 161 | 91 | 461 | 153 | 93 |
| Institutional and support expenditure | 246 | 106 | 0 | 43 | 91 | 14 | 86 | 70 | 10 | 76 |
| Other Intra-ACP allocations | 2 251 | 1 245 | 885 | 55 | 810 | 560 | 65 | 490 | 284 | 61 |
| Peace facility | 1 000 | 994 | 94 | 99 | 885 | 7 | 89 | 805 | 74 | 91 |
| SUB TOTAL: INTRA-ACP ALLOCATIONS | 3 497 | 2 344 | 979 | 67 | 1 786 | 580 | 76 | 1 365 | 368 | 76 |
| Regional allocations | 5 766 | 4 422 | 1 536 | 77 | 3 514 | 1 408 | 79 | 943 | 582 | 27 |
| SUB TOTAL: REGIONAL ALLOCATIONS | 5 766 | 4 422 | 1 536 | 77 | 3 514 | 1 408 | 79 | 943 | 582 | 27 |
| Co-financing | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 22 | 20 | 17 | 92 | 20 | 20 | 100 | | | |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 22 | 20 | 17 | 92 | 20 | 20 | 100 | | | |
| Implementation costs | 1 | | | | | | | | | |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 1 | | | | | | | | | |
| Peace facility | 1 | 1 | | 100 | 1 | 0 | 100 | 1 | 1 | 100 |
| SUB TOTAL: INTRA-ACP ALLOCATIONS | 1 | 1 | | 100 | 1 | 0 | 100 | 1 | 1 | 100 |
| Mobilisable reserves | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| B Envelope reserve | 0 | | | | | | | | | |
| SUB TOTAL: COUNTRY RESERVE | 0 | | | | | | | | | |
| Intra-ACP Reserve | 93 | | | | | | | | | |
| SUB TOTAL: INTRA-ACP RESERVE | 93 | | | | | | | | | |
| National allocations Reserve A Envelope Stabex | 0 | | | | | | | | | |
| SUB TOTAL: NATIONAL ALLOCATIONS RESERVE A ENVELOPE Stabex | 0 | | | | | | | | | |
| NIP/RIP reserve | 2 351 | | | | | | | | | |
| SUB TOTAL: NIP/RIP RESERVE | 2 351 | | | | | | | | | |
| Non-mobilisable reserve | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| Non-mobilisable reserve | 201 | | | | | | | | | |
| SUB TOTAL: NON-MOBILISABLE RESERVE | 201 | | | | | | | | | |
| EC Internal SLA | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| A Envelope — National Allocations | 1 | 1 | | 71 | 1 | | 100 | 1 | | 73 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 1 | 1 | | 71 | 1 | | 100 | 1 | | 73 |
| OCTs | | | | | | | | | | |
| Regular MS Contributions | | | | | | | | | | |
| Allocations | | | | | | | | | | |
| A Envelope — National Allocations | 189 | 97 | 56 | 51 | 87 | 61 | 90 | 28 | 21 | 33 |
| SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS | 189 | 97 | 56 | 51 | 87 | 61 | 90 | 28 | 21 | 33 |
| Bridging facility | 0 | | | | | | | | | |
| SUB TOTAL: BRIDGING FACILITY | 0 | | | | | | | | | |
| Studies/Technical assistance OCTs | 5 | 5 | 2 | 94 | 4 | 1 | 75 | 2 | 1 | 66 |
| SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES | 5 | 5 | 2 | 94 | 4 | 1 | 75 | 2 | 1 | 66 |
| Regional allocations | 1 | 0 | 0 | 0 | | | | | | |
| SUB TOTAL: REGIONAL ALLOCATIONS | 1 | 0 | 0 | 0 | | | | | | |
| Mobilisable reserves | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| NIP/RIP reserve | 165 | | | | | | | | | |
| SUB TOTAL: NIP/RIP RESERVE | 165 | | | | | | | | | |
| Non-mobilisable reserve | | | | | | | | | | |
| Reserves | | | | | | | | | | |
| Non-mobilisable reserve | 5 | | | | | | | | | |
| SUB TOTAL: NON-MOBILISABLE RESERVE | 5 | | | | | | | | | |
| TOTAL: ACP+OCTs (INCL. RESERVES) (A+B) | 29 621 | 19 027 | 5 807 | 64 | 13 453 | 5 684 | 71 | 6 206 | 2 770 | 46 |

(EUR millions)

CREDITS

DECISIONS

ASSIGNED FUNDS

PAYMENTS

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

AGGREG.

ANNUAL

%

(1)

(2)

(2):(1)

(3)

(3):(2)

(4)

(4):(3)

ACP

ACP

Regular MS Contributions

Regular MS Contributions

Allocations

Allocations

A Envelope — National Allocations

15 540

10 890

2 960

70

6 856

3 106

63

2 931

1 414

43

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

15 540

15 540

10 890

10 890

2 960

2 960

70

70

6 856

6 856

3 106

3 106

63

63

2 931

2 931

1 414

1 414

43

43

B Envelope — National Allocations

715

Emergency aid

590

91

578

247

98

443

205

77

Other chocs with budgetary impact

109

0

109

100

100

29

24

26

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: B ENVELOPE — NATIONAL ALLOCATIONS

715

715

699

699

91

91

98

98

687

687

347

347

98

98

472

472

229

229

69

69

Bridging facility

0

SUB TOTAL: BRIDGING FACILITY

SUB TOTAL: BRIDGING FACILITY

0

0

Implementation costs

1 053

538

164

51

490

161

91

456

153

93

Interests and other receipts

16

10

2

62

6

0

63

6

0

93

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

1 068

1 068

548

548

166

166

51

51

496

496

161

161

91

91

461

461

153

153

93

93

Institutional and support expenditure

246

106

0

43

91

14

86

70

10

76

Other Intra-ACP allocations

2 251

1 245

885

55

810

560

65

490

284

61

Peace facility

1 000

994

94

99

885

7

89

805

74

91

SUB TOTAL: INTRA-ACP ALLOCATIONS

SUB TOTAL: INTRA-ACP ALLOCATIONS

3 497

3 497

2 344

2 344

979

979

67

67

1 786

1 786

580

580

76

76

1 365

1 365

368

368

76

76

Regional allocations

5 766

4 422

1 536

77

3 514

1 408

79

943

582

27

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

5 766

5 766

4 422

4 422

1 536

1 536

77

77

3 514

3 514

1 408

1 408

79

79

943

943

582

582

27

27

Co-financing

Co-financing

Allocations

Allocations

A Envelope — National Allocations

22

20

17

92

20

20

100

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

22

22

20

20

17

17

92

92

20

20

20

20

100

100

Implementation costs

1

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

1

1

Peace facility

1

1

100

1

0

100

1

1

100

SUB TOTAL: INTRA-ACP ALLOCATIONS

SUB TOTAL: INTRA-ACP ALLOCATIONS

1

1

1

1

100

100

1

1

0

0

100

100

1

1

1

1

100

100

Mobilisable reserves

Mobilisable reserves

Reserves

Reserves

B Envelope reserve

0

SUB TOTAL: COUNTRY RESERVE

SUB TOTAL: COUNTRY RESERVE

0

0

Intra-ACP Reserve

93

SUB TOTAL: INTRA-ACP RESERVE

SUB TOTAL: INTRA-ACP RESERVE

93

93

National allocations Reserve A Envelope Stabex

0

SUB TOTAL: NATIONAL ALLOCATIONS RESERVE A ENVELOPE Stabex

SUB TOTAL: NATIONAL ALLOCATIONS RESERVE A ENVELOPE Stabex

0

0

NIP/RIP reserve

2 351

SUB TOTAL: NIP/RIP RESERVE

SUB TOTAL: NIP/RIP RESERVE

2 351

2 351

Non-mobilisable reserve

Non-mobilisable reserve

Reserves

Reserves

Non-mobilisable reserve

201

SUB TOTAL: NON-MOBILISABLE RESERVE

SUB TOTAL: NON-MOBILISABLE RESERVE

201

201

EC Internal SLA

EC Internal SLA

Reserves

Reserves

A Envelope — National Allocations

1

1

71

1

100

1

73

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

1

1

1

1

71

71

1

1

100

100

1

1

73

73

OCTs

OCTs

Regular MS Contributions

Regular MS Contributions

Allocations

Allocations

A Envelope — National Allocations

189

97

56

51

87

61

90

28

21

33

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

SUB TOTAL: A ENVELOPE — NATIONAL ALLOCATIONS

189

189

97

97

56

56

51

51

87

87

61

61

90

90

28

28

21

21

33

33

Bridging facility

0

SUB TOTAL: BRIDGING FACILITY

SUB TOTAL: BRIDGING FACILITY

0

0

Studies/Technical assistance OCTs

5

5

2

94

4

1

75

2

1

66

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

SUB TOTAL: IMPLEMENTATION COSTS AND INTERESTS REVENUES

5

5

5

5

2

2

94

94

4

4

1

1

75

75

2

2

1

1

66

66

Regional allocations

1

0

0

0

SUB TOTAL: REGIONAL ALLOCATIONS

SUB TOTAL: REGIONAL ALLOCATIONS

1

1

0

0

0

0

0

0

Mobilisable reserves

Mobilisable reserves

Reserves

Reserves

NIP/RIP reserve

165

SUB TOTAL: NIP/RIP RESERVE

SUB TOTAL: NIP/RIP RESERVE

165

165

Non-mobilisable reserve

Non-mobilisable reserve

Reserves

Reserves

Non-mobilisable reserve

5

SUB TOTAL: NON-MOBILISABLE RESERVE

SUB TOTAL: NON-MOBILISABLE RESERVE

5

5

TOTAL: ACP+OCTs (INCL. RESERVES) (A+B)

TOTAL: ACP+OCTs (INCL. RESERVES) (A+B)

29 621

29 621

19 027

19 027

5 807

5 807

64

64

13 453

13 453

5 684

5 684

71

71

6 206

6 206

2 770

2 770

46

46

ANNUAL REPORT ON IMPLEMENTATION — FUNDS MANAGED BY THE EUROPEAN INVESTMENT BANK

ANNUAL REPORT ON IMPLEMENTATION — FUNDS MANAGED BY THE EUROPEAN INVESTMENT BANK

| EUROPEAN INVESTMENT BANK | CA/511/18


  15 March 2018 |
| --- | --- |
| | Document 18/099 |
| BOARD OF DIRECTORS |
| INVESTMENT FACILITY


  FINANCIAL STATEMENTS


  AS AT 31 DECEMBER 2017 |
| — | Statement of financial position |

EUROPEAN INVESTMENT BANK

EUROPEAN INVESTMENT BANK

CA/511/18

CA/511/18

15 March 2018

Document 18/099

Document 18/099

BOARD OF DIRECTORS

BOARD OF DIRECTORS

INVESTMENT FACILITY

INVESTMENT FACILITY

FINANCIAL STATEMENTS

FINANCIAL STATEMENTS

AS AT 31 DECEMBER 2017

AS AT 31 DECEMBER 2017

—

Statement of financial position

| — | Statement of profit or loss and other comprehensive income |
| --- | --- |

—

Statement of profit or loss and other comprehensive income

| — | Statement of changes in contributors’ resources |
| --- | --- |

—

Statement of changes in contributors’ resources

| — | Statement of cash flows |
| --- | --- |

—

Statement of cash flows

| — | Notes to the financial statements |
| --- | --- |

—

Notes to the financial statements

| — | Independent auditor’s report |
| --- | --- |

—

Independent auditor’s report

STATEMENT OF FINANCIAL POSITION

STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2017

AS AT 31 DECEMBER 2017

| (in EUR ’000) |
| --- |
| | Notes | 31.12.2017 | 31.12.2016 |
| ASSETS | | | |
| Cash and cash equivalents | 5 | 549 101 | 360 817 |
| Amounts receivable from contributors | 9/16 | 150 000 | 86 395 |
| Held-to-maturity financial assets | 10 | 144 382 | 169 398 |
| Derivative financial instruments | 6 | 12 521 | 6 920 |
| Loans and receivables | 7 | 1 666 725 | 1 729 380 |
| Available-for-sale financial assets | 8 | 497 539 | 516 884 |
| Other assets | 11 | 4 385 | 345 |
| Total assets | | 3 024 653 | 2 870 139 |
| LIABILITIES AND CONTRIBUTORS’ RESOURCES | | | |
| LIABILITIES | | | |
| Derivative financial instruments | 6 | 1 153 | 25 189 |
| Deferred income | 12 | 25 802 | 26 283 |
| Provisions for guarantees issued | 13 | 484 | 625 |
| Amounts owed to third parties | 14 | 157 285 | 116 114 |
| Other liabilities | 15 | 2 462 | 2 546 |
| Total liabilities | | 187 186 | 170 757 |
| CONTRIBUTORS’ RESOURCES | | | |
| Member States Contribution called | 16 | 2 517 000 | 2 377 000 |
| Fair value reserve | | 125 816 | 142 884 |
| Retained earnings | | 194 651 | 179 498 |
| Total contributors’ resources | | 2 837 467 | 2 699 382 |
| Total liabilities and contributors’ resources | | 3 024 653 | 2 870 139 |

(in EUR ’000)

Notes

31.12.2017

31.12.2016

ASSETS

ASSETS

Cash and cash equivalents

5

549 101

360 817

Amounts receivable from contributors

9/16

150 000

86 395

Held-to-maturity financial assets

10

144 382

169 398

Derivative financial instruments

6

12 521

6 920

Loans and receivables

7

1 666 725

1 729 380

Available-for-sale financial assets

8

497 539

516 884

Other assets

11

4 385

345

Total assets

Total assets

3 024 653

3 024 653

2 870 139

2 870 139

LIABILITIES AND CONTRIBUTORS’ RESOURCES

LIABILITIES AND CONTRIBUTORS’ RESOURCES

LIABILITIES

LIABILITIES

Derivative financial instruments

6

1 153

25 189

Deferred income

12

25 802

26 283

Provisions for guarantees issued

13

484

625

Amounts owed to third parties

14

157 285

116 114

Other liabilities

15

2 462

2 546

Total liabilities

Total liabilities

187 186

187 186

170 757

170 757

CONTRIBUTORS’ RESOURCES

CONTRIBUTORS’ RESOURCES

Member States Contribution called

16

2 517 000

2 377 000

Fair value reserve

125 816

142 884

Retained earnings

194 651

179 498

Total contributors’ resources

Total contributors’ resources

2 837 467

2 837 467

2 699 382

2 699 382

Total liabilities and contributors’ resources

Total liabilities and contributors’ resources

3 024 653

3 024 653

2 870 139

2 870 139

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 DECEMBER 2017

FOR THE YEAR ENDED 31 DECEMBER 2017

| (in EUR ’000) |
| --- |
| | Notes | From 1.1.2017 | From 1.1.2016 |
| to 31.12.2017 | to 31.12.2016 |
| Interest and similar income | 18 | 101 406 | 106 698 |
| Interest and similar expenses | 18 | -2 671 | -2 307 |
| Net interest and similar income | | 98 735 | 104 391 |
| Fee and commission income | 19 | 210 | 699 |
| Fee and commission expenses | 19 | - 60 | - 48 |
| Net fee and commission income | | 150 | 651 |
| Fair value change of derivative financial instruments | | 29 637 | -10 361 |
| Net realised gains on available-for-sale financial assets | 20 | 2 711 | 6 504 |
| Net foreign exchange loss | | -38 165 | -14 995 |
| Net result on financial operations | | -5 817 | -18 852 |
| Change in impairment on loans and receivables, net of reversal | 7 | -10 721 | 44 365 |
| Change in provisions for guarantees | 13 | - 65 | - 242 |
| Impairment on available-for-sale financial assets | 8 | -22 024 | -2 493 |
| General administrative expenses | 21 | -45 105 | -43 483 |
| Profit/loss for the year | | 15 153 | 84 337 |
| Other comprehensive income: | | | |
| Items that are or may be reclassified to profit or loss: | | | |
| Available-for-sale financial assets — Fair value reserve | 8 | | |
| 1. | Net change in fair value of available-for-sale financial assets |

(in EUR ’000)

Notes

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Interest and similar income

18

101 406

106 698

Interest and similar expenses

18

-2 671

-2 307

Net interest and similar income

Net interest and similar income

98 735

98 735

104 391

104 391

Fee and commission income

19

210

699

Fee and commission expenses

19

- 60

- 48

Net fee and commission income

Net fee and commission income

150

150

651

651

Fair value change of derivative financial instruments

29 637

-10 361

Net realised gains on available-for-sale financial assets

20

2 711

6 504

Net foreign exchange loss

-38 165

-14 995

Net result on financial operations

Net result on financial operations

-5 817

-5 817

-18 852

-18 852

Change in impairment on loans and receivables, net of reversal

7

-10 721

44 365

Change in provisions for guarantees

13

- 65

- 242

Impairment on available-for-sale financial assets

8

-22 024

-2 493

General administrative expenses

21

-45 105

-43 483

Profit/loss for the year

Profit/loss for the year

15 153

15 153

84 337

84 337

Other comprehensive income:

Other comprehensive income:

Items that are or may be reclassified to profit or loss:

Items that are or may be reclassified to profit or loss:

Available-for-sale financial assets — Fair value reserve

8

1.

Net change in fair value of available-for-sale financial assets

-31 034

-14 624

| 2. | Net amount transferred to profit or loss |
| --- | --- |

2.

Net amount transferred to profit or loss

13 966

-6 485

Total available-for-sale financial assets

Total available-for-sale financial assets

-17 068

-17 068

-21 109

-21 109

Total other comprehensive income

Total other comprehensive income

-17 068

-17 068

-21 109

-21 109

Total comprehensive income for the year

Total comprehensive income for the year

-1 915

-1 915

63 228

63 228

STATEMENT OF CHANGES IN CONTRIBUTORS’ RESOURCES

STATEMENT OF CHANGES IN CONTRIBUTORS’ RESOURCES

FOR THE YEAR ENDED 31 DECEMBER 2017

FOR THE YEAR ENDED 31 DECEMBER 2017

| (in EUR ’000) |
| --- |
| | Notes | Contribution called | Fair value reserve | Retained earnings | Total |
| At 1 January 2017 | | 2 377 000 | 142 884 | 179 498 | 2 699 382 |
| Member States contribution called during the year | 16 | 140 000 | — | — | 140 000 |
| Profit for the year 2017 | | — | — | 15 153 | 15 153 |
| Total other comprehensive income for the year | | — | -17 068 | — | -17 068 |
| Changes in contributors’ resources | | 140 000 | -17 068 | 15 153 | 138 085 |
| At 31 December 2017 | | 2 517 000 | 125 816 | 194 651 | 2 837 467 |
| At 1 January 2016 | | 2 157 000 | 163 993 | 95 161 | 2 416 154 |
| Member States contribution called during the year | 16 | 220 000 | — | — | 220 000 |
| Profit for the year 2016 | | — | — | 84 337 | 84 337 |
| Total other comprehensive income for the year | | — | -21 109 | — | -21 109 |
| Changes in contributors’ resources | | 220 000 | -21 109 | 84 337 | 283 228 |
| At 31 December 2016 | | 2 377 000 | 142 884 | 179 498 | 2 699 382 |

(in EUR ’000)

Notes

Contribution called

Fair value reserve

Retained earnings

Total

At 1 January 2017

At 1 January 2017

2 377 000

2 377 000

142 884

142 884

179 498

179 498

2 699 382

2 699 382

Member States contribution called during the year

16

140 000

—

—

140 000

Profit for the year 2017

—

—

15 153

15 153

Total other comprehensive income for the year

—

-17 068

—

-17 068

Changes in contributors’ resources

Changes in contributors’ resources

140 000

140 000

-17 068

-17 068

15 153

15 153

138 085

138 085

At 31 December 2017

At 31 December 2017

2 517 000

2 517 000

125 816

125 816

194 651

194 651

2 837 467

2 837 467

At 1 January 2016

At 1 January 2016

2 157 000

2 157 000

163 993

163 993

95 161

95 161

2 416 154

2 416 154

Member States contribution called during the year

16

220 000

—

—

220 000

Profit for the year 2016

—

—

84 337

84 337

Total other comprehensive income for the year

—

-21 109

—

-21 109

Changes in contributors’ resources

Changes in contributors’ resources

220 000

220 000

-21 109

-21 109

84 337

84 337

283 228

283 228

At 31 December 2016

At 31 December 2016

2 377 000

2 377 000

142 884

142 884

179 498

179 498

2 699 382

2 699 382

STATEMENT OF CASH FLOWS

STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 DECEMBER 2017

FOR THE YEAR ENDED 31 DECEMBER 2017

| (in EUR ’000) |
| --- |
| | Notes | From 1.1.2017 to 31.12.2017 | From 1.1.2016 to 31.12.2016 |
| OPERATING ACTIVITIES | | | |
| Profit for the financial year | | 15 153 | 84 337 |
| Adjustments made for: | | | |
| Impairment on available-for-sale financial assets | 8 | 22 024 | 2 493 |
| Net change in impairment on loans and receivables | 7 | 10 721 | -44 365 |
| Interest capitalised on loans and receivables | 7 | — | -7 183 |
| Change in accrued interest and amortised cost on loans and receivables | 7 | -1 198 | -5 843 |
| Net change in provisions for guarantees issued | 13 | - 141 | 625 |
| Change in accrued interest and amortised cost on held-to-maturity financial assets | 10 | - 398 | -1 126 |
| Change in deferred income | | - 481 | -3 042 |
| Effect of exchange rate changes on loans | 7 | 168 304 | -35 025 |
| Effect of exchange rate changes on available-for-sale financial assets | | -1 655 | -5 125 |
| Effect of exchange rate changes on cash held | | -6 473 | -1 106 |
| Loss on operating activities before changes in operating assets and liabilities | | 205 856 | -15 360 |
| Loan disbursements | 7 | - 368 662 | - 528 376 |
| Repayments of loans | 7 | 253 486 | 351 468 |
| Change in accrued interest on cash and cash equivalent | 5 | 63 | 2 |
| Fair value changes on derivatives | | -29 637 | 10 361 |
| (Decrease) in held-to-maturity financial assets | 10 | -1 084 149 | -1 159 704 |
| Maturities of held-to-maturity financial assets | 10 | 1 109 563 | 1 219 953 |
| (Decrease) in available-for-sale financial assets | 8 | -62 660 | - 153 986 |
| Repayments/sales of available-for-sale financial assets | 8 | 44 568 | 37 978 |
| (Increase) in other assets | | -4 040 | - 318 |
| (Decrease)/increase in other liabilities | | - 84 | 182 |
| Increase in amounts payable to the European Investment Bank | | 2 202 | 423 |
| Net cash flows used from/in operating activities | | 66 506 | - 237 377 |
| FINANCING ACTIVITIES | | | |
| Contribution received from Member States | 16 | 76 395 | 133 605 |
| Amounts received from Member States with regard to interest subsidies and technical assistance | | 60 000 | 30 000 |
| Amounts paid on behalf of Member States with regard to interest subsidies and technical assistance | | -21 026 | -15 510 |
| Net cash flows from financing activities | | 115 369 | 148 095 |
| Net increase/(decrease) in cash and cash equivalents | | 181 875 | -89 282 |
| Summary statement of cash flows: | | | |
| Cash and cash equivalents at the beginning of financial year | | 360 821 | 448 998 |
| Net cash from: | | | |
| Operating activities | | 66 506 | - 237 377 |
| Financing activities | | 115 369 | 148 095 |
| Effects of exchange rate changes on cash and cash equivalents | | 6 473 | 1 106 |
| Cash and cash equivalents at the end of financial year | | 549 169 | 360 822 |
| Cash and cash equivalents are composed of: | | | |
| Cash in hand | 5 | 166 445 | 51 462 |
| Term deposits (excluding accrued interest) | | 367 721 | 259 342 |
| Commercial papers | 5 | 15 003 | 50 018 |
| | | 549 169 | 360 822 |

(in EUR ’000)

Notes

From 1.1.2017 to 31.12.2017

From 1.1.2016 to 31.12.2016

OPERATING ACTIVITIES

OPERATING ACTIVITIES

Profit for the financial year

15 153

84 337

Adjustments made for:

Impairment on available-for-sale financial assets

8

22 024

2 493

Net change in impairment on loans and receivables

7

10 721

-44 365

Interest capitalised on loans and receivables

7

—

-7 183

Change in accrued interest and amortised cost on loans and receivables

7

-1 198

-5 843

Net change in provisions for guarantees issued

13

- 141

625

Change in accrued interest and amortised cost on held-to-maturity financial assets

10

- 398

-1 126

Change in deferred income

- 481

-3 042

Effect of exchange rate changes on loans

7

168 304

-35 025

Effect of exchange rate changes on available-for-sale financial assets

-1 655

-5 125

Effect of exchange rate changes on cash held

-6 473

-1 106

Loss on operating activities before changes in operating assets and liabilities

Loss on operating activities before changes in operating assets and liabilities

205 856

205 856

-15 360

-15 360

Loan disbursements

7

- 368 662

- 528 376

Repayments of loans

7

253 486

351 468

Change in accrued interest on cash and cash equivalent

5

63

2

Fair value changes on derivatives

-29 637

10 361

(Decrease) in held-to-maturity financial assets

10

-1 084 149

-1 159 704

Maturities of held-to-maturity financial assets

10

1 109 563

1 219 953

(Decrease) in available-for-sale financial assets

8

-62 660

- 153 986

Repayments/sales of available-for-sale financial assets

8

44 568

37 978

(Increase) in other assets

-4 040

- 318

(Decrease)/increase in other liabilities

- 84

182

Increase in amounts payable to the European Investment Bank

2 202

423

Net cash flows used from/in operating activities

Net cash flows used from/in operating activities

66 506

66 506

- 237 377

- 237 377

FINANCING ACTIVITIES

FINANCING ACTIVITIES

Contribution received from Member States

16

76 395

133 605

Amounts received from Member States with regard to interest subsidies and technical assistance

60 000

30 000

Amounts paid on behalf of Member States with regard to interest subsidies and technical assistance

-21 026

-15 510

Net cash flows from financing activities

Net cash flows from financing activities

115 369

115 369

148 095

148 095

Net increase/(decrease) in cash and cash equivalents

Net increase/(decrease) in cash and cash equivalents

181 875

181 875

-89 282

-89 282

Summary statement of cash flows:

Summary statement of cash flows:

Cash and cash equivalents at the beginning of financial year

Cash and cash equivalents at the beginning of financial year

360 821

360 821

448 998

448 998

Net cash from:

Operating activities

66 506

- 237 377

Financing activities

115 369

148 095

Effects of exchange rate changes on cash and cash equivalents

6 473

1 106

Cash and cash equivalents at the end of financial year

Cash and cash equivalents at the end of financial year

549 169

549 169

360 822

360 822

Cash and cash equivalents are composed of:

Cash and cash equivalents are composed of:

Cash in hand

5

166 445

51 462

Term deposits (excluding accrued interest)

367 721

259 342

Commercial papers

5

15 003

50 018

549 169

549 169

360 822

360 822

Notes to the financial statements as at 31 December 2017

Notes to the financial statements as at 31 December 2017

1.   General information

General information

The Investment Facility (‘the Facility’ or ‘IF’) has been established within the framework of the Cotonou Agreement (the ‘Agreement’) on cooperation and development assistance negotiated between the African, Caribbean and Pacific Group of States (the ‘ACP States’) and the European Union and its Member States on 23 June 2000, revised on 25 June 2005 and 22 June 2010.

The Facility is not a separate legal entity and the European Investment Bank (‘EIB’ or ‘the Bank’) manages the contributions on behalf of the Member States (‘Donors’) in accordance with the terms of the Agreement and acts as an administrator of the Facility.

Financing under the Agreement is provided from EU Member States’ budgets. EU Member States contribute with the amounts allocated to finance the IF and grants for the financing of the interest subsidies as provided for under the multi-annual financial frameworks (First Financial Protocol covering the period 2000-2007 and referred to as the 9th European Development Fund (EDF), Second Financial Protocol covering the period 2008-2013 and referred to as the 10th EDF and the Third Financial Protocol covering the period 2014-2020 referred to as the 11th EDF). The EIB is entrusted with the management of:

th

th

th

| — | the Facility, a EUR 3 685,5 million risk-bearing revolving fund geared to fostering private sector investment in ACP countries of which EUR 48,5 million are allocated to Overseas Countries and territories (‘OCTs countries’); |
| --- | --- |

—

the Facility, a EUR 3 685,5 million risk-bearing revolving fund geared to fostering private sector investment in ACP countries of which EUR 48,5 million are allocated to Overseas Countries and territories (‘OCTs countries’);

| — | grants for the financing of interest subsidies worth max. EUR 1 220,85 million for ACP countries and max. EUR 8,5 million for OCTs countries. Up to 15 % of these subsidies can be used to fund project-related technical assistance (‘TA’). |
| --- | --- |

—

grants for the financing of interest subsidies worth max. EUR 1 220,85 million for ACP countries and max. EUR 8,5 million for OCTs countries. Up to 15 % of these subsidies can be used to fund project-related technical assistance (‘TA’).

The present financial statements cover the period from 1 January 2017 to 31 December 2017.

On a proposal from the Management Committee of EIB, the Board of Directors of EIB adopted the Financial Statements on 15 March 2018, and authorised their submission to the Board of Governors for approval by 27 April 2018.

2.   Significant accounting policies

Significant accounting policies

2.1.   Basis of preparation — Statement of compliance

The Facility’s financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

2.2.   Significant accounting judgments and estimates

The preparation of financial statements requires the use of accounting estimates. It also requires the European Investment Bank’s Management to exercise its judgment in the process of applying the Investment Facility’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed hereafter.

The most significant use of judgments and estimates are as follows:

— Measurement of fair values of financial instruments

— Measurement of fair values of financial instruments

Fair values of financial assets and financial liabilities that are traded in active markets are based on quoted market prices or broker price quotations. Where the fair values cannot be derived from active markets, they are determined using a variety of valuation techniques that include the use of mathematical models. The input to these models is taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. The valuations are categorised into different levels in the fair value hierarchy based on the inputs used in the valuation techniques as described and disclosed in Notes 2.4.3 and 4.

These valuation techniques may include net present value and discounted cash flow models, comparison to similar instruments for which market observable prices exist, Black-Scholes and polynomial option pricing models and other valuation models. Assumptions and inputs used in valuation techniques include risk-free and benchmark interest rates, credit spreads used in estimating discount rates, bond and equity prices, foreign currency exchange rates, equity and equity index prices and expected price volatilities and correlations.

The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date.

The Facility uses widely recognised valuation models for determining the fair value of common and more simple financial instruments, like interest rate and currency swaps that use only observable market data and require limited management judgement and estimation. Observable prices and model inputs are usually available in the market for listed debt and equity securities, exchange traded derivatives and simple over the counter derivatives like interest rate swaps. Availability of observable market prices and model inputs reduces the need for management judgement and estimation and also reduces the uncertainty associated with determination of fair values. Availability of observable market prices and inputs varies depending on the products and markets and is prone to changes based on specific events and general conditions in the financial markets.

For more complex instruments, the Facility uses own valuation models, which are developed from recognised valuation models. Some or all of the significant inputs into these models may not be observable in the market, and are derived from market prices or rates or are estimated based on assumptions. Example of instruments involving significant unobservable inputs includes certain loans and guarantees for which there is no active market. Valuation models that employ significant unobservable inputs require a higher degree of management judgement and estimation in the determination of fair value. Management judgement and estimation are usually required for selection of the appropriate valuation model to be used, determination of expected future cash flows on the financial instrument being valued, determination of probability or counterparty default and prepayments and selection of appropriate discount rates.

The Facility has an established control framework with respect to the measurement of fair values. This framework includes the EIB’s Investment Bank’s Risk Management and Market Data Management functions. These functions are independent of front office management and are responsible for verifying significant fair value measurements. Specific controls include:

| — | Verification of observable pricing; |
| --- | --- |

—

Verification of observable pricing;

| — | A review and approval process for new valuation models and changes to existing models; |
| --- | --- |

—

A review and approval process for new valuation models and changes to existing models;

| — | Calibration and back testing of models against observed market transactions; |
| --- | --- |

—

Calibration and back testing of models against observed market transactions;

| — | Analysis and investigation of significant valuation movements; |
| --- | --- |

—

Analysis and investigation of significant valuation movements;

| — | Review of significant unobservable inputs and valuation adjustments. |
| --- | --- |

—

Review of significant unobservable inputs and valuation adjustments.

Where third-party information such as broker quotes or pricing services are used to measure fair value, the Facility verifies that such valuations meet the requirements of IFRS. This includes the following:

| — | Determining where broker quote or pricing service pricing is appropriate; |
| --- | --- |

—

Determining where broker quote or pricing service pricing is appropriate;

| — | Assessing whether a particular broker quote or pricing service is reliable; |
| --- | --- |

—

Assessing whether a particular broker quote or pricing service is reliable;

| — | Understanding how the fair value has been arrived at and the extent to which it represents actual market transactions; |
| --- | --- |

—

Understanding how the fair value has been arrived at and the extent to which it represents actual market transactions;

| — | When prices for similar instruments are used to measure fair value, how these prices have been adjusted to reflect the characteristics of the instrument subject to measurement. |
| --- | --- |

—

When prices for similar instruments are used to measure fair value, how these prices have been adjusted to reflect the characteristics of the instrument subject to measurement.

— Impairment losses on loans and receivables

— Impairment losses on loans and receivables

The Facility reviews its loans and receivables at each reporting date to assess whether an allowance for impairment should be recorded in the statement of profit or loss and other comprehensive income. In particular, judgment by the European Investment Bank’s Management is required in the estimation of the amount and timing of future cash flows when determining the level of allowance required. Such estimates are based on assumptions about a number of factors and actual results may differ, resulting in future changes to the allowance. In addition to specific allowances against individually significant loans and receivables, the Facility may also book a collective impairment allowance against exposures which have not been individually identified as impaired and have a greater risk of default than when originally granted.

In principle, a loan is considered as impaired when payment of interest and principal are past due by 90 days or more and, at the same time, the European Investment Bank’s Management considers that there is an objective indication of impairment.

— Provisions on financial guarantees

— Provisions on financial guarantees

The Facility reviews its guarantee contracts at each reporting date to assess whether a provision should be recorded in the statement of profit or loss and other comprehensive income. For determining the provision particular judgement is required in making estimates and assumptions about a number of factors, such as:

| — | amount and timing of future cash flows; |
| --- | --- |

—

amount and timing of future cash flows;

| — | utilisation level of the guarantees; |
| --- | --- |

—

utilisation level of the guarantees;

| — | discount factors applied on the estimated cash flows. |
| --- | --- |

—

discount factors applied on the estimated cash flows.

— Valuation of unquoted available-for-sale equity investments

— Valuation of unquoted available-for-sale equity investments

Valuation of unquoted available-for-sale equity investments is normally based on one of the following:

| — | recent arm’s length market transactions; |
| --- | --- |

—

recent arm’s length market transactions;

| — | current fair value of another instrument that is substantially the same; |
| --- | --- |

—

current fair value of another instrument that is substantially the same;

| — | the expected cash flows discounted at current rates applicable for items with similar terms and risk characteristics; |
| --- | --- |

—

the expected cash flows discounted at current rates applicable for items with similar terms and risk characteristics;

| — | adjusted net assets method; or |
| --- | --- |

—

adjusted net assets method; or

| — | other valuation models. |
| --- | --- |

—

other valuation models.

The determination of the cash flows and discount factors for unquoted available-for-sale equity investments requires significant estimation. The Facility calibrates the valuation techniques periodically and tests them for validity using either price from observable current market transactions in the same instrument or from other available observable market data.

— Impairment of available-for-sale financial assets

— Impairment of available-for-sale financial assets

The Facility treats available-for-sale equity investments as impaired when there has been a significant or prolonged decline in the fair value below its cost or where other objective evidence of impairment exists. The determination of what is ‘significant’ or ‘prolonged’ requires judgment. The Facility treats ‘significant’ generally as 30 % or more and ‘prolonged’ greater than 12 months. In addition, the Facility evaluates other factors, including normal volatility in share price for quoted equities and the future cash flows and the discount factors for unquoted equities.

— Consolidation of entities in which the Facility holds interest

— Consolidation of entities in which the Facility holds interest

The Facility made significant judgements that none of the entities in which it holds interest, are controlled by the Facility. This is due to the fact that in all such entities, either the General Partner or the Fund Manager or the Management Board have the sole responsibility for the management and control of the activities and affairs of the partnership and have the power and authority to do all things necessary to carry out the purpose and objectives of the partnership complying with the investment and policy guidelines.

2.3.   Changes in accounting policies

Except for the changes below, the Facility has consistently applied the accounting policies set out in Note 2.4 to all periods presented in these financial statements. The Facility has adopted the following new standards and amendments to standards.

Standards adopted

Standards adopted

Amendments to IAS 7 ‘Statement of cash flows’ — Disclosure initiative;

Amendments to IAS 7 ‘Statement of cash flows’ — Disclosure initiative;

The amendments require disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flow and non-cash changes. Amendments are effective for annual reporting periods beginning on or after 1 January 2017, with early adoption permitted.

Additional disclosures of relevance for the Facility include changes arising from:

| — | cash flows, such as drawdowns and repayments of borrowings; and |
| --- | --- |

—

cash flows, such as drawdowns and repayments of borrowings; and

| — | non-cash changes, such as acquisitions, disposals and unrealised exchange differences. |
| --- | --- |

—

non-cash changes, such as acquisitions, disposals and unrealised exchange differences.

Amendment to IAS 7 has been endorsed by the EU on 9 November 2017 and is effective for the annual reporting periods beginning on or after 1 January 2017.

Standards issued but not yet effective

Standards issued but not yet effective

The following standards, amendments to standards and interpretations are effective for annual periods beginning after 1 January 2017. The Facility has not applied the following new or amended standards in preparing these financial statements.

Annual improvements 2014-2016 Cycle — various standards (Amendments to IFRS 12)

Annual improvements 2014-2016 Cycle — various standards (Amendments to IFRS 12)

This amendment clarifies that the disclosure requirement of IFRS 12 is applicable to interest in entities classified as held for sale except for summarised financial information. Previously, it was unclear whether all other IFRS 12 requirements were applicable for these interests.

The adoption of these amendments had no impact on the Facility`s financial statements.

It is worth noted that the aforementioned amendments have not been yet endorsed by EU according to the latest status of endorsement by EFRAG.

IFRS 9 Financial instruments

IFRS 9 Financial instruments

Estimated impact of the adoption of IFRS 9 — Financial instruments

Estimated impact of the adoption of IFRS 9 — Financial instruments

The last part of the standard was issued on 24 July 2014 and replaces the existing guidance in IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 addresses the classification, measurement and derecognition of financial assets and financial liabilities, introduces a new expected credit loss model for impairment on financial assets and introduces new rules for hedge accounting.

IAS 39 Financial Instruments

IFRS 9 has been endorsed by the EU on 22 November 2016 and is effective for annual reporting periods beginning on or after 1 January 2018, with early adoption permitted. The Facility did not adopt the standard earlier than its effective date. The Facility has assessed the estimated impact that the initial application of IFRS 9 will have on its contributors resources’ in the financial statements.

| In EUR ’000 | As reported at 31 December 2017 | Estimated adjustment to contributors` resources at
  1 January 2018 | Estimated adjusted opening balance at 1 January 2018 |
| --- | --- | --- | --- |
| Net impact contributors‘ resources | 2 837 467 | 53 891 | 2 783 576 |

In EUR ’000

As reported at 31 December 2017

Estimated adjustment to contributors` resources at

1 January 2018

Estimated adjusted opening balance at 1 January 2018

Net impact contributors‘ resources

Net impact contributors‘ resources

2 837 467

2 837 467

53 891

53 891

2 783 576

2 783 576

This impact is based on the assessments undertaken to date and is summarised below. The actual impacts of adopting IFRS 9 at 1 January 2018 may change because:

| — | the Bank has not finalised the testing and assessment of controls over its new IT systems; and |
| --- | --- |

—

the Bank has not finalised the testing and assessment of controls over its new IT systems; and

| — | The new accounting policies are subject to change until the Facility presents its first financial statements that include the date of initial application. |
| --- | --- |

—

The new accounting policies are subject to change until the Facility presents its first financial statements that include the date of initial application.

Classification and measurement

Classification and measurement

IFRS 9 contains a new classification and measurement approach for financial assets that reflects the business model in which assets are managed and their cash flow characteristics.

IFRS 9 contains three principal classification categories for financial assets: measured at amortised cost (‘AC’), fair value through other comprehensive income (‘FVOCI’) and fair value through profit or loss (‘FVTPL’). The standard eliminates the existing IAS 39 categories of held to maturity, loans and receivables and available for sale.

In addition, under IFRS 9, derivatives embedded in contracts where the host is a financial asset in the scope of the standard are never bifurcated. Instead, the hybrid financial instrument as a whole is assessed for classification.

Based on its assessment, the Facility does not expect the new guidance to have a significant impact on the classification and measurement of its financial assets and financial liabilities except for:

| — | equity investments: There are two types of equity investments at the Facility: (i) direct equity investments and (ii) venture capital funds. At 31 December 2017, the Facility had classified equity investments, as available-for-sale with a fair value of EUR 497 million. Under IFRS 9, the Facility will designate these investments as measured at FVTPL. The related fair value reserve will be released against the retained earnings. |
| --- | --- |

—

equity investments: There are two types of equity investments at the Facility: (i) direct equity investments and (ii) venture capital funds. At 31 December 2017, the Facility had classified equity investments, as available-for-sale with a fair value of EUR 497 million. Under IFRS 9, the Facility will designate these investments as measured at FVTPL. The related fair value reserve will be released against the retained earnings.

| — | quasi-equity loans, which are a category of ‘debt’ bearing equity-type risks. The cash flows of those types of products have equity-type features that are unrelated to a basic lending arrangement. According to the requirements of IFRS 9, quasi-equity loans will be mandatorily reclassified from loans and receivables under IAS 39 to FVTPL under IFRS 9. The fair value of quasi-equity loans are EUR 1,4 million as at 31 December 2017. These net fair value adjustments amount to EUR 0,4 million. |
| --- | --- |

—

quasi-equity loans, which are a category of ‘debt’ bearing equity-type risks. The cash flows of those types of products have equity-type features that are unrelated to a basic lending arrangement. According to the requirements of IFRS 9, quasi-equity loans will be mandatorily reclassified from loans and receivables under IAS 39 to FVTPL under IFRS 9. The fair value of quasi-equity loans are EUR 1,4 million as at 31 December 2017. These net fair value adjustments amount to EUR 0,4 million.

IFRS 9 largely retains the existing requirements in IAS 39 for the classification of financial liabilities and the IF’s financial liabilies are measured at amortised under IAS39 and IFRS9 as well.

Impairment

Impairment

IFRS 9 replaces the ‘incurred loss’ model in IAS 39 with a forward-looking ‘expected credit loss’ (‘ECL’) model. This will require judgement as to how changes in economic factors affect ECLs, which will be determined on a probability-weighted basis.

To comply with IFRS the EIB has developed an Expected Credit Loss (hereinafter ‘ECL’) model for the EIB`s IFRS group financial statements which is also applied to the IF.

The new impairment model will apply to financial assets measured at AC as well as to off-balance commitments

Under IFRS 9, loss allowances will be measured on either of the following bases:

| — | 12-month ECL’s: these are the ECLs that result from possible default events within the 12 months after the reporting date; and |
| --- | --- |

—

12-month ECL’s: these are the ECLs that result from possible default events within the 12 months after the reporting date; and

| — | Lifetime ECLs: these are the ECLs that result from all possible default events over the expected life of a financial instrument. |
| --- | --- |

—

Lifetime ECLs: these are the ECLs that result from all possible default events over the expected life of a financial instrument.

The IFRS 9 Standard sets out a ‘three-stage’ model for impairment based on changes in credit quality since initial recognition. Financial instruments are classified in Stage 1 except for those instruments for which significant increase in credit risk (SICR) since initial recognition is identified. For determining whether there is a significant increase in credit risk since initial recognition, the Bank considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Facility’s historical experience and expert credit and including forward-looking information. If significant increase in credit risk has occurred, the financial instrument is moved to Stage 2 but is not yet deemed to be credit-impaired. If the financial instrument is credit-impaired, the financial instrument is then moved to Stage 3. The Bank’s assessment of the impairment Stage is based on a sequential approach using counterparty or instrument specific information (Internal Default Event, Special High Risk, Watch List, Rating deterioration, Days in arrears — more than 30 days past due).

Lifetime ECL measurement applies to Stage 2 and Stage 3 assets, while 12-month ECL measurement applies to Stage 1 assets.

It is expected that impairment losses are likely to increase and become more volatile for assets in the scope of the IFRS 9 impairment model. Based on the impairment methodology described below, the Facility has estimated that application of IFRS 9’s impairment requirements at 1 January 2018 results in additional impairment losses as follows:

| In EUR ’000 | Estimated additional impairment recognised at 1 January 2018 |
| --- | --- |
| Loans and receivables | 49 709 |
| Treasury assets | 30 |
| Undisbursed loans | 4 152 |
| Gross additional impairment losses | 53 891 |

In EUR ’000

Estimated additional impairment recognised at 1 January 2018

Loans and receivables

49 709

Treasury assets

30

Undisbursed loans

4 152

Gross additional impairment losses

Gross additional impairment losses

53 891

53 891

Treasury assets are composed of high credit quality securities, therefore, the Facility decided to make use of the IFRS 9 practical expedient for low credit risk financial instruments.

The expected credit losses were calculated based on the following variables:

| — | Probability of default (PD), |
| --- | --- |

—

Probability of default (PD),

| — | Loss Given default (LGD), |
| --- | --- |

—

Loss Given default (LGD),

| — | Exposure at default (EAD). |
| --- | --- |

—

Exposure at default (EAD).

The PD represents the likelihood of a counterpart defaulting on its financial obligation, either over the next 12 months, or over the remaining lifetime of the obligation. PD is estimated at a certain date, which are calculated based on statistical rating models, and assessed using rating tools tailored to the various categories of counterparties and exposures.

Ratings are primary input into the determination of the term structure of PD for exposures. Performance and default information about its credit risk exposures are collected. The collected data are segmented by type of industry and by type of region. Different industries and regions reacting in a homogenous manner to credit cycles are analysed together.

The EIB employs statistical models to analyse the data collected and generate estimates of the remaining lifetime PD of exposures and how these are expected to change as a result of the passage of time. This analysis includes the identification and calibration of relationships between changes in default rates and changes in key macroeconomic factors. The gross domestic product (GDP) growth is identified as the relevant macroeconomic factor. Based on projections of that variable, three macroeconomic scenarios are generated, which are then translated into credit cycles and finally into PDs.

The LGD represents the expectation of the extent of loss on a defaulted exposure. The LGD definition is derived from the following definition of Recovery rate (i.e. ‘1-LGD’): the recovery rate for each defaulted contract is the ratio between the discounted cash flows received after the default date and the capital outstanding at the default date. LGD varies by type of counterparty, type and seniority of claim and availability of collateral or other credit support. Recovery rates are defined across three main classes of borrowers: non-EU Sovereigns and Public Institutions, Financial Institutions and Corporates.

The EAD represents the expected exposure in the event of a default EAD and is based on the current exposure to the counterparty and potential changes to the current amount allowed under the contract including amortisation. The EAD of a financial asset is its gross carrying amount, the outstanding signed on-balance exposures. For lending commitments and financial guarantees, the EAD includes the amount drawn, as well as potential future amounts that may be drawn under the contract.

The Facility estimated that the application of IFRS 9 impairment requirements at 1 January 2018 results in an increase of EUR 53,9 million over the impairment recognised under IAS 39.

The following table provides information about the estimated exposure to credit and ECLs for loans and advances to credit institutions and customers and undisbursed loans: For an overview of credit risk on cash and cash equivalent and held-to-maturity financial assets, see note 3.2.

| In EUR ’000 | Disbursed amount | Undisbursed amount | Estimated impairment loss allowance | Credit impaired |
| --- | --- | --- | --- | --- |
| Stage 1 | 1 265 945 | 823 023 | 21 727 | No |
| Stage 2 | 375 716 | 20 615 | 32 134 | No |
| Stage 3 | 138 319 | — | 113 255 | Yes |
| Total | 1 779 980 | 843 638 | 167 116 | |

In EUR ’000

Disbursed amount

Undisbursed amount

Estimated impairment loss allowance

Credit impaired

Stage 1

1 265 945

823 023

21 727

No

Stage 2

375 716

20 615

32 134

No

Stage 3

138 319

—

113 255

Yes

Total

Total

1 779 980

1 779 980

843 638

843 638

167 116

167 116

Disclosures

Disclosures

IFRS 9 will require extensive new disclosures, in particular about credit risk and expected credit losses. Preliminary assessment included an analysis to identify data gaps against current processes. The Facility has planned to implement the system and controls changes that it believes will be necessary to capture the required data.

Transition

Transition

Changes in accounting policies resulting from the adoption of IFRS 9 will generally be applied retrospectively, except as described below:

| — | The Facility will take advantage of the exemption allowing it not to restate comparative information for prior periods with respect to classification and measurement (including impairment) changes. Differences in the carrying amounts of financial assets and financial liabilities resulting from the adoption of IFRS 9 will generally be recognised in the contributors` resources as at 1 January 2018. |
| --- | --- |

—

The Facility will take advantage of the exemption allowing it not to restate comparative information for prior periods with respect to classification and measurement (including impairment) changes. Differences in the carrying amounts of financial assets and financial liabilities resulting from the adoption of IFRS 9 will generally be recognised in the contributors` resources as at 1 January 2018.

| — | The following assessments have to be made on the basis of the facts and circumstances that exist at the date of initial application:






  — | The determination of the business model within which a financial asset is held, |
| --- | --- | --- |

—

The following assessments have to be made on the basis of the facts and circumstances that exist at the date of initial application:

—

The determination of the business model within which a financial asset is held,

| — | The designation and revocation of previous designations of certain financial assets and financial liabilities as measured at FVTPL. |
| --- | --- |

—

The designation and revocation of previous designations of certain financial assets and financial liabilities as measured at FVTPL.

IFRS 15 Revenue from Contracts with Customers

IFRS 15 Revenue from Contracts with Customers

IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including IAS 18 Revenue, IAS 11 Construction Contracts and IFRIC 13 Customer Loyalty Programmes.

The core principle of IFRS 15 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the Standard introduces a five-step approach to revenue recognition:

| — | Identify the contract with the customer; |
| --- | --- |

—

Identify the contract with the customer;

| — | Identify the performance obligations in the contract; |
| --- | --- |

—

Identify the performance obligations in the contract;

| — | Determine the transaction price; |
| --- | --- |

—

Determine the transaction price;

| — | Allocate the transaction price to the performance obligations in the contracts; |
| --- | --- |

—

Allocate the transaction price to the performance obligations in the contracts;

| — | Recognise revenue when (or as) the entity satisfies the performance obligation. |
| --- | --- |

—

Recognise revenue when (or as) the entity satisfies the performance obligation.

Under IFRS 15, an entity recognizes revenue when (or as) a performance obligation is satisfied, i.e. when ‘control’ of the goods or services underlying the particular performance obligation is transferred to the customer.

Additional disclosures are required when IFRS 15 is to be effective.

The standard gives a range of possible transition methods including (i) a full retrospective approach, (ii) a modified retrospective approach with optional practical expedients and (iii) a cumulative effect method with no restatement of comparative information.

At this stage, the Facility is finalising the assessment of the effects of applying the new standard on the financial statements. The nature of the following three main income types has been further analysed whether the new standard applies to them:

| — | Interest and similar income |
| --- | --- |

—

Interest and similar income

| — | Fee and commission income |
| --- | --- |

—

Fee and commission income

| — | Net financial result |
| --- | --- |

—

Net financial result

The Facility’s analysis indicated that only fee and commission income is in scope of IFRS 15.

Regarding Fee and commission income, the Facility is currently performing an assessment per type of fee. The preliminary assessment is based on the fact that the fee which is an integral part of the effective interest rate calculation is considered as out of IFRS 15 scope (in scope of IFRS 9). For the types of fees that are in scope of IFRS 15, the Facility is assessing the revenue recognition pattern of each type according to the 5-step approach of IFRS 15 and compares it with the existing one.

IFRS 15 has been endorsed by the EU on 22 September 2016 and is effective for annual reporting periods beginning on or after 1 January 2018.

The Facility intends to adopt the standard using the modified retrospective approach which means that the cumulative impact of the adoption will be recognised in retained earnings as of 1 January 2018 and that comparatives will not be restated.

Based on the detailed assessment of the impact resulting from the application of IFRS 15 by the Facility, it is not expected that this new standard will have a significant impact on the Facility’s financial statements.

IFRS 16 Leases

IFRS 16 Leases

IFRS 16 was issued in January 2016 and replaces the current guidance of IAS 17. It will result in almost all leases being recognised on the balance sheet, as the distinction between operating and finance leases is removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognised. The only exemptions are short-term and low-value leases. The accounting for lessors will not significantly change.

IFRS 16 has been endorsed by the EU on 31 October 2017 and is effective for annual reporting periods beginning on or after 1 January 2019, with early adoption permitted if IFRS 15 is applied.

The Facility expects that this change will have no material impact on the Facility`s financial statements.

IFRIC 22 Foreign currency transactions and advance consideration

IFRIC 22 Foreign currency transactions and advance consideration

The Interpretation applies where an entity either pays or receives consideration in advance for foreign currency-denominated contract. It considers how to determine the date of the transaction when applying the standard on foreign currency transactions, IAS 21 and provides guidance whether the date of the transaction is the date when the asset, expense or income is initially recognised, or the earlier date on which the advance consideration is paid or received, resulting in recognition of a prepayment or deferred income.

The Interpretation has not yet been adopted by the EU. According to the latest update of EFRAG, endorsement is not expected by the end of the year.

The Facility does not plan to adopt this interpretation early and does not expect to cause any material impact on the Facility’s financial statements.

2.4.   Summary of significant accounting policies

The statement of financial position represents assets and liabilities in decreasing order of liquidity and does not distinguish between current and non-current tems.

2.4.1.   Foreign currency translation

Foreign currency translation

The Facility uses the Euro (EUR) for presenting its financial statements, which is also the functional currency. Except as otherwise indicated, financial information presented in EUR has been rounded to the nearest thousand.

Foreign currency transactions are translated, at the exchange rate prevailing on the date of the transaction.

Monetary assets and liabilities denominated in currencies other than Euro are translated into Euro at the exchange rate prevailing at the statement of financial position date. The gain or loss arising from such translation is recorded in the statement of profit or loss and other comprehensive income.

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined.

Exchange differences arising on the settlement of transactions at rates different from those at the date of the transaction, and unrealised foreign exchange differences on unsettled foreign currency monetary assets and liabilities, are recognised in the statement of profit or loss and other comprehensive income.

The elements of the statement of profit or loss and other comprehensive income are translated into Euro on the basis of the exchange rates prevailing at the date of the transaction.

2.4.2.   Cash and cash equivalents

Cash and cash equivalents

The Facility defines cash and cash equivalents as current accounts, short-term deposits or commercial papers with original maturities of three months or less.

2.4.3.   Financial assets other than derivatives

Financial assets other than derivatives

Financial assets are accounted for using the settlement date basis.

— Fair value of financial instruments

— Fair value of financial instruments

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal, or in its absence, the most advantageous market to which the Facility has access at that date.

When applicable, the EIB on behalf of the Facility measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an on-going basis.

Where the fair values of financial assets and financial liabilities recorded on the statement of financial position cannot be derived from active markets, they are determined using a variety of valuation techniques that include the use of mathematical models. The input to these models is taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. The chosen valuation technique incorporates all the factors that market participants would take into account in pricing a transaction.

The EIB measures fair values using the following fair value hierarchy that reflects the significance of the inputs used in making the measurements:

| — | Level 1: inputs that are unadjusted quoted market prices in active markets for identical instruments to which the Facility has access. |
| --- | --- |

—

Level 1: inputs that are unadjusted quoted market prices in active markets for identical instruments to which the Facility has access.

| — | Level 2: inputs other than quoted prices included within Level 1 that are observable either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valued using quoted market prices in active markets for similar instruments, quoted prices for identical or similar instruments in markets that are considered less than active or other valuation techniques where all significant inputs are directly or indirectly observable from market data. |
| --- | --- |

—

Level 2: inputs other than quoted prices included within Level 1 that are observable either directly (i.e. as prices) or indirectly (i.e. derived from prices). This category includes instruments valued using quoted market prices in active markets for similar instruments, quoted prices for identical or similar instruments in markets that are considered less than active or other valuation techniques where all significant inputs are directly or indirectly observable from market data.

| — | Level 3: inputs that are not observable. This category includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation. This category includes instruments that are valued based on quoted prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences between the instruments. |
| --- | --- |

—

Level 3: inputs that are not observable. This category includes all instruments where the valuation technique includes inputs not based on observable data and the unobservable inputs have a significant effect on the instrument’s valuation. This category includes instruments that are valued based on quoted prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences between the instruments.

The Facility recognises transfers between levels of the fair value hierarchy as of the end of the reporting period during which the change has occurred.

— Held-to-maturity financial assets

— Held-to-maturity financial assets

Held-to-maturity financial assets comprise quoted bonds with the intention of holding them to maturity, and commercial papers with original maturities of more than three months.

Those bonds and commercial papers are initially recorded at their fair value plus any directly attributable transaction cost. The difference between entry price and redemption value is amortised in accordance with the effective interest method over the remaining life of the instrument.

The Facility assesses at each statement of financial position date whether there is any objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after the initial recognition of the asset (an incurred ‘loss event’) and that loss event (or event) has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Impairment loss is recognised in the statement of profit and loss and the amount of the loss is measured as the difference between the carrying value and the present value of estimated future cash flows discounted at the instrument’s original effective interest rate.

— Loans

— Loans

Loans originated by the Facility are recognised in the assets of the Facility when cash is advanced to borrowers. They are initially recorded at cost (net disbursed amounts), which is the fair value of the cash given to originate the loan, including any transaction costs, and are subsequently measured at amortised cost, using the effective yield method, less any provision for impairment or uncollectability.

— Available-for-sale financial assets

— Available-for-sale financial assets

Available-for-sale financial assets are those which are designated as such or do not qualify to be classified as designated at fair value through profit or loss, held-to-maturity or loans and receivables. They include direct equity investments and investments in venture capital funds and are initially recorded at fair value plus transaction costs.

After initial measurement, available-for-sale financial assets are subsequently carried at fair value. Note the following details for the fair value measurement of equity investments, which cannot be derived from active markets:

a.   Venture capital funds

The fair value of each venture capital fund is based on the latest available Net Asset Value (NAV), reported by the fund, if calculated based on international valuation guidelines recognised to be in line with IFRS (for example: the International Private Equity and Venture Capital Valuation guidelines, IPEV Guidelines, as published by the European Venture Capital Association). The Facility may however decide to adjust the NAV reported by the fund if there are issues that may affect the valuation.

b.   Direct equity investments

The fair value of the investment is based on the latest set of financial statements available, re-using, if applicable, the same model as the one used at the acquisition of the participation.

Unrealised gains or losses on venture capital funds and direct equity investments are reported in contributors’ resources until such investments are sold, collected or disposed of, or until such investments are determined to be impaired. If an available-for-sale investment is determined to be impaired, the cumulative unrealised gain or loss previously recognised in equity is transferred to the statement of profit or loss and other comprehensive income.

For unquoted investment, the fair value is determined by applying recognised valuation techniques (for example adjusted net assets, discounted cash flows or multiple). These investments are accounted for at cost when the fair value cannot be reliably measured. To be noted that in the first 2 years of the investments, they are recognised at cost.

The participations acquired by the Facility typically represent investments in private equity or venture capital funds. According to industry practice, such investments are generally investments jointly subscribed by a number of investors, none of whom is in a position to individually influence the daily operations and the investment activity of such fund. As a consequence, any membership by an investor in a governing body of such fund does not in principle entitle such investor to influence the day-to-day operations of the fund. In addition, individual investors in a private equity or a venture capital fund do not determine policies of a fund such as distribution policies on dividends or other distributions. Such decisions are typically taken by the management of a fund on the basis of the shareholders agreement governing the rights and obligations of the management and all shareholders of the fund. The shareholders’ agreement also generally prevents individual investors from bilaterally executing material transactions with the fund, interchanging managerial personnel or obtaining privileged access to essential technical information. The Facility’s investments are executed in line with the above stated industry practice, ensuring that the Facility neither controls nor exercises any form of significant influence within the meaning of IFRS 10 and IAS 28 over any of these investments, including those investments in which the Facility holds over 20 % of the voting rights.

— Guarantees

— Guarantees

Financial guarantee contracts are contracts that require the Facility to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payments when due in accordance with the terms of a debt instrument.

Under the existing rules, these guarantees do not meet the definition of an insurance contract (IFRS 4 Insurance Contracts) and are accounted for under IAS 39 Financial Instruments: Recognition and Measurement, either as ‘Derivatives’ or as ‘Financial Guarantees’, depending on their features and characteristics as defined by IAS 39.

The accounting policy for derivatives is disclosed under Note 2.4.5.

At initial recognition, the financial guarantees are recognised at fair value corresponding to the Net Present Value (NPV) of expected premium inflows and initial expected loss. This calculation is performed at the starting date of each transaction and is recognised on the statement of financial position as ‘Financial guarantees’ under ‘other assets’ and ‘other liabilities’.

Subsequent to initial recognition, the Facility’s liabilities under such guarantees are measured at the higher of:

| — | the amount initially recognised less, where appropriate, cumulative amortisation recognised in accordance with IAS 18 Revenue and |
| --- | --- |

—

the amount initially recognised less, where appropriate, cumulative amortisation recognised in accordance with IAS 18 Revenue and

| — | the best estimate of expenditure required to settle any present financial obligation arising as a result of the guarantee, in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. |
| --- | --- |

—

the best estimate of expenditure required to settle any present financial obligation arising as a result of the guarantee, in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

The best estimate of expenditure is determined in accordance with IAS 37. Financial guarantee provisions correspond to the cost of settling the obligation, which is the expected loss, estimated on the basis of all relevant factors and information existing at the statement of financial position date.

When a financial guarantee operation measured under IAS 39 is derecognised and treated under IAS 37, its value previously recorded under ‘Other liabilities’ is transferred to the caption ‘Provisions for guarantees issued’ on the statement of financial position.

The provision for financial guarantees (as measured per IAS 37) is recognised in the statement of profit or loss and other comprehensive income under ‘Change in provisions for guarantees, net of reversals’.

The premium received is recognised in the statement of profit or loss and other comprehensive income in ‘Fee and commission income’ on the basis of an amortisation schedule in accordance with IAS 18 over the life of the financial guarantee.

In addition, when a guarantee agreement is signed, it is presented as a contingent liability for the Facility and when the guarantee is engaged, as a commitment for the Facility.

2.4.4.   Impairment of financial assets

Impairment of financial assets

The Facility assesses at each statement of financial position date whether there is any objective evidence that a financial asset is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one or more events that has occurred after the initial recognition of the asset (an incurred ‘loss event’) and that loss event has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. Evidence of impairment may include indications that the borrower or a group of borrowers is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter into bankruptcy or other financial reorganisation and where observable data indicate that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults.

For the loans outstanding at the end of the financial year and carried at amortised cost, impairments are made when presenting objective evidence of risks of non-recovery of all or part of their amounts according to the original contractual terms or the equivalent value. If there is objective evidence that an impairment loss has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash flows. The carrying amount of the asset is reduced through the use of an allowance account and the amount of the loss is recognised in the statement of profit or loss and other comprehensive income. Interest income continues to be accrued on the reduced carrying amount based on the effective interest rate of the asset. Loans together with the associated allowance are written off when there is no realistic prospect of future recovery. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases because of an event occurring after the impairment was recognised, the previously recognised impairment loss is increased or reduced by adjusting the allowance account.

The Facility conducts the credit risk assessments based on each individual operation and does not consider a collective impairment.

For the available-for-sale financial assets, the Facility assesses at each statement of financial position date whether there is objective evidence that an investment is impaired. Objective evidence would include a significant or prolonged decline in the fair value of the investment below its costs. Where there is evidence of impairment, the cumulative loss (measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that investment previously recognised in the statement of profit or loss and other comprehensive income) is removed from contributors’ resources and recognised in the statement of profit or loss and other comprehensive income. Impairment losses on available-for-sale financial assets are not reversed through the statement of profit or loss and other comprehensive income; increases in their fair value after impairment are recognised directly in contributors’ resources.

The European Investment Bank’s Risk Management reviews financial assets for impairment at least once a year. Resulting adjustments include the unwinding of the discount in the statement of profit or loss and other comprehensive income over the life of the asset, and any adjustments required in respect of a reassessment of the initial impairment.

2.4.5.   Derivative financial instruments

Derivative financial instruments

Derivatives include cross currency swaps, cross currency interest rate swaps, short term currency swaps (‘FX swaps’) and interest rate swaps.

In the normal course of its activity, the Facility may enter into swap contracts with a view to hedge specific lending operations or into currency forward contract with a view to hedge its currency positions, denominated in actively traded currencies other than the Euro, in order to offset any gain or loss caused by foreign exchange rate fluctuations.

The Facility does not use any of the hedge possibilities under IAS 39. All derivatives are measured at fair value through the profit or loss and are reported as derivative financial instruments. Fair values are derived primarily from discounted cash-flow models, option-pricing models and from third party quotes.

Derivatives are recorded at fair value and carried as assets when their fair value is positive and as liabilities when their fair value is negative. Changes in the fair value of derivative financial instruments are shown in the statement of profit and loss and other comprehensive income under ‘Fair value change of derivative financial instruments’.

Derivatives are initially recognised using the trade date basis.

2.4.6.   Contributions

Contributions

Contributions from Member States are recognised as receivables in the statement of financial position on the date of the Council Decision fixing the financial contribution to be paid by the Member States to the Facility.

The Member States contributions meet the following conditions and are consequently classified as equity:

| — | as defined in the contribution agreement, they entitle the Member States to decide on the utilisation of the Facility’s net assets in the events of the Facility’s liquidation; |
| --- | --- |

—

as defined in the contribution agreement, they entitle the Member States to decide on the utilisation of the Facility’s net assets in the events of the Facility’s liquidation;

| — | they are in the class of instruments that is subordinated to all other classes of instruments; |
| --- | --- |

—

they are in the class of instruments that is subordinated to all other classes of instruments;

| — | all financial instruments in the class of instruments that are subordinated to all other classes of instruments have identical features; |
| --- | --- |

—

all financial instruments in the class of instruments that are subordinated to all other classes of instruments have identical features;

| — | the instrument does not include any features that would require classification as a liability; and |
| --- | --- |

—

the instrument does not include any features that would require classification as a liability; and

| — | the total expected cash flows attributable to the instrument over its life are based substantially on the profit or loss, the change in the recognised net assets or the change in the fair value of the recognised and unrecognised net assets of the Facility over the life of the instrument. |
| --- | --- |

—

the total expected cash flows attributable to the instrument over its life are based substantially on the profit or loss, the change in the recognised net assets or the change in the fair value of the recognised and unrecognised net assets of the Facility over the life of the instrument.

2.4.7.   Interest income on loans

Interest income on loans

Interest on loans originated by the Facility is recorded in the statement of profit or loss and other comprehensive income (‘Interest and similar income’) and on the statement of financial position (‘Loans and receivables’) on an accrual basis using the effective interest rate, which is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the loan to the net carrying amount of the loan. Once the recorded value of a loan has been reduced due to impairment, interest income continues to be recognised using the original effective interest rate applied to the new carrying amount.

Commitment fees are deferred and recognised in income using the effective interest method over the period from disbursement to repayment of the related loan, and are presented in the statement of profit or loss and other comprehensive income within interest and similar income.

2.4.8.   Interest subsidies and technical assistance

Interest subsidies and technical assistance

As part of its activity, the Facility manages interest subsidies and technical assistance on behalf of the Member States.

The part of the Member States contributions allocated to the payment of interest subsidies and TA is not accounted for in the Facility’s contributors’ resources but is classified as amounts owed to third parties. The Facility operates the disbursement to the final beneficiaries and then decreases the amounts owed to third parties.

When amounts contributed with regard to interest subsidies and TA are not fully granted, they are reclassified as contribution to the Facility.

2.4.9.   Interest income on cash and cash equivalents

Interest income on cash and cash equivalents

Interest income on cash and cash equivalents is recognised in the statement of profit or loss and other comprehensive income of the Facility on an accrual basis.

2.4.10.   Fees, commissions and dividends

Fees, commissions and dividends

Fees received in respect of services provided over a period of time are recognised as income as the services are provided, while fees that are earned on the execution of a significant act are recognised as income when the significant act has been completed. These fees are presented in the statement of profit or loss and other comprehensive income within fee and commission income.

Dividends relating to available-for-sale financial assets are recognised when received and presented in the statement of profit or loss and other comprehensive income within net realised gains on available-for-sale financial assets.

2.5.   Taxation

The Protocol on the Privileges and Immunities of the European Union, appended to the Treaty on European Union and the Treaty on the Functioning of the European Union, stipulates that the assets, revenues and other property of the Institutions of the Union are exempt from all direct taxes.

3.   Risk Management

Risk Management

This note presents information about the Facility’s exposure to and its management and control of credit and financial risks, in particular the primary risks associated with its use of financial instruments. These are:

| — | credit risk — the risk of loss resulting from client or counterparty default and arising on credit exposure in all forms, including settlement risk; |
| --- | --- |

—

credit risk — the risk of loss resulting from client or counterparty default and arising on credit exposure in all forms, including settlement risk;

| — | liquidity risk — the risk that an entity is not able to fund increases in assets and meet obligations as they come due, without incurring unacceptable losses; |
| --- | --- |

—

liquidity risk — the risk that an entity is not able to fund increases in assets and meet obligations as they come due, without incurring unacceptable losses;

| — | market risk — the risk that changes in market prices and rates, such as interest rates, equity prices and foreign exchange rates will affect an entity’s income or the value of its holdings in financial instruments. |
| --- | --- |

—

market risk — the risk that changes in market prices and rates, such as interest rates, equity prices and foreign exchange rates will affect an entity’s income or the value of its holdings in financial instruments.

3.1.   Risk management organisation

The European Investment Bank, as a manager of the Facility, adapts its risk management on an ongoing basis.

The Risk Management of EIB independently identifies, assesses, monitors and reports the risks to which the Facility is exposed. Within a framework whereby the segregation of duties is preserved, the Risk Management is independent of the Front Offices. At EIB level the Director-General of Risk Management reports for risk matters to the designated Vice-President for Risk Management. The designated Vice-President is responsible for overseeing risk reporting to the European Investment Bank’s Management Committee and the Board of Directors.

3.2.   Credit risk

Credit risk is the potential loss that could result from client or counterparty default and arising on credit exposure in all forms, including settlement.

3.2.1.   Credit risk policy

Credit risk policy

In carrying out the credit analysis on loan counterparts, EIB assesses the credit risk and expected loss with a view to quantify and price the risk. EIB has developed an Internal Rating Methodology (IRM) to determine the Internal Ratings of its credit-relevant borrower/guarantor counterparts. The methodology is based on a system of scoring sheets tailored for each major credit counterpart type (e.g. Corporates, Banks, Public Sector Entities, etc.). Taking into consideration both, Best Banking Practice and the principles set under the Basel International Capital Accord (Basel II), all counterparts that are material to the credit profile of a specific transaction are classified into internal rating categories using the IRM for the specific counterpart type. Each counterpart is assigned an Internal Rating reflecting its probability of default foreign currency rating following an in-depth analysis of the counterpart’s business and financial risk profile and its country risk operating context.

The credit assessment of project finance and other structured limited recourse operations is using credit risk tools relevant for the sector, focused mainly on cash flow availability and debt service capacity. These tools include the analysis of projects’ contractual framework, counterpart’s analysis and cash flow simulations. Similarly to corporates and financial institutions, each project is assigned an internal risk rating.

All Internal Ratings are monitored over loan life, and periodically updated.

All non-sovereign (or non sovereign guaranteed/assimilated) operations are subject to specific transaction-level and counterpart size limits. Counterpart limits are set at consolidated group exposure level, where applicable. Such limits typically reflect e.g. the size of counterparts own funds.

In order to mitigate credit risk the EIB uses, where appropriate and on a case by case basis, various credit enhancements which are:

| — | Counterparty or project-related securities (e.g., pledge over the shares; pledge over the assets; assignment of rights; pledge over the accounts); or/and |
| --- | --- |

—

Counterparty or project-related securities (e.g., pledge over the shares; pledge over the assets; assignment of rights; pledge over the accounts); or/and

| — | guarantees, generally provided by the sponsor of the financed project (e.g., completion guarantees, first demand guarantees) or bank guarantees. |
| --- | --- |

—

guarantees, generally provided by the sponsor of the financed project (e.g., completion guarantees, first demand guarantees) or bank guarantees.

The Facility does not use any credit derivatives to mitigate credit risk.

3.2.2.   Maximum exposure to credit risk without taking into account any collateral and other credit enhancements

Maximum exposure to credit risk without taking into account any collateral and other credit enhancements

The following table shows the maximum exposure to credit risk for the components of the statement of financial position, including derivatives. The maximum exposure is shown gross, before the effect of mitigation through the use of collateral.

| Maximum exposure (in EUR '000) | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| ASSETS | | |
| Cash and cash equivalents | 549 101 | 360 817 |
| Amounts receivable from contributors | 150 000 | 86 395 |
| Held-to-maturity financial assets | 144 382 | 169 398 |
| Derivative financial instruments | 12 521 | 6 920 |
| Loans and receivables | 1 666 725 | 1 729 380 |
| Other assets | 4 385 | 345 |
| Total assets | 2 527 114 | 2 353 255 |
| OFF BALANCE SHEET | | |
| Contingent liabilities | | |
| — | Guarantees undrawn |

Maximum exposure (in EUR '000)

31.12.2017

31.12.2016

ASSETS

ASSETS

Cash and cash equivalents

549 101

360 817

Amounts receivable from contributors

150 000

86 395

Held-to-maturity financial assets

144 382

169 398

Derivative financial instruments

12 521

6 920

Loans and receivables

1 666 725

1 729 380

Other assets

4 385

345

Total assets

Total assets

2 527 114

2 527 114

2 353 255

2 353 255

OFF BALANCE SHEET

OFF BALANCE SHEET

Contingent liabilities

—

Guarantees undrawn

74 569

35 337

Commitments

| — | Undisbursed loans |
| --- | --- |

—

Undisbursed loans

869 983

901 899

| — | Guarantees drawn |
| --- | --- |

—

Guarantees drawn

7 682

8 627

Total off balance sheet

Total off balance sheet

952 234

952 234

945 863

945 863

Total credit exposure

Total credit exposure

3 479 348

3 479 348

3 299 118

3 299 118

3.2.3.   Credit risk on loans and receivables

Credit risk on loans and receivables

3.2.3.1.   Credit risk measurement for loans and receivables

Credit risk measurement for loans and receivables

Each and every loan or guarantee undertaken by the Facility benefits from a comprehensive risk assessment and quantification of expected loss estimates that are reflected in a Loan Grading (‘LG’). Operations under the IFE (as described in Note 23), with the exception of intermediated loans, are not subject to the Credit Risk Policy Guidelines and are subject to a different procedure. LGs are established according to generally accepted criteria, based on the quality of the borrower, the maturity of the loan, the guarantee and, where appropriate, the guarantor.

The loan grading (LG) system comprises the methodologies, processes, databases and IT systems supporting the assessment of credit risk in lending operations and the quantification of expected loss estimates. It summarises a large amount of information with the purpose of offering a relative ranking of loans’ credit risks. LGs reflect the present value of the estimated level of the ‘expected loss’, this being the product of the probability of default of the main obligors, the exposure at risk and the loss severity in the case of default. LGs are used for the following purposes:

| — | as an aid to a finer and more quantitative assessment of lending risks; |
| --- | --- |

—

as an aid to a finer and more quantitative assessment of lending risks;

| — | as help in distributing monitoring efforts; |
| --- | --- |

—

as help in distributing monitoring efforts;

| — | as a description of the loan’s portfolio quality at any given date; |
| --- | --- |

—

as a description of the loan’s portfolio quality at any given date;

| — | as one input in risk-pricing decisions based on the expected loss. |
| --- | --- |

—

as one input in risk-pricing decisions based on the expected loss.

The following factors enter into the determination of an LG:

| (i) | The borrower’s creditworthiness: Risk Management independently reviews borrowers and assesses their creditworthiness based on internal methodologies and external data. In line with the Basel II Advanced Approach chosen, the Bank has developed an internal rating methodology (IRM) to determine the internal ratings of borrowers and guarantors. This is based on a set of scoring sheets specific to defined counterparty types. |
| --- | --- |

(i)

The borrower’s creditworthiness: Risk Management independently reviews borrowers and assesses their creditworthiness based on internal methodologies and external data. In line with the Basel II Advanced Approach chosen, the Bank has developed an internal rating methodology (IRM) to determine the internal ratings of borrowers and guarantors. This is based on a set of scoring sheets specific to defined counterparty types.

| (ii) | The default correlation: it quantifies the chances of simultaneous financial difficulties arising for both the borrower and the guarantor. The higher the correlation between the borrower and the guarantor’s default probabilities, the lower the value of the guarantee and therefore the lower the LG. |
| --- | --- |

(ii)

The default correlation: it quantifies the chances of simultaneous financial difficulties arising for both the borrower and the guarantor. The higher the correlation between the borrower and the guarantor’s default probabilities, the lower the value of the guarantee and therefore the lower the LG.

| (iii) | The value of guarantee instruments and of securities: this value is assessed on the basis of the combination of the issuer’s creditworthiness and the type of instrument used. |
| --- | --- |

(iii)

The value of guarantee instruments and of securities: this value is assessed on the basis of the combination of the issuer’s creditworthiness and the type of instrument used.

| (iv) | The contractual framework: a sound contractual framework will add to the loan’s quality and enhance its internal grading. |
| --- | --- |

(iv)

The contractual framework: a sound contractual framework will add to the loan’s quality and enhance its internal grading.

| (v) | The loan’s duration: all else being equal, the longer the loan, the higher the risk of incurring difficulties in the servicing of the loan. |
| --- | --- |

(v)

The loan’s duration: all else being equal, the longer the loan, the higher the risk of incurring difficulties in the servicing of the loan.

A loan’s expected loss is computed by combining the five elements discussed above. Depending on the level of this loss, a loan is assigned to one of the following LG classes listed below:

| A | Prime quality loans: there are three sub-categories. A comprises all EU sovereign risks, i.e. loans granted to or fully, explicitly and unconditionally guaranteed by Member States, where no repayment difficulties are expected and for which an unexpected loss of 0 % is allocated. A+ denotes loans granted to (or guaranteed by) entities other than Member States, with no expectation of deterioration over their duration. A- includes those lending operations where there is some doubt about the maintenance of their current status (for instance because of a long maturity, or for the high volatility of the future price of an otherwise excellent collateral), but where any downside is expected to be quite limited. |
| --- | --- |

A

Prime quality loans: there are three sub-categories. A comprises all EU sovereign risks, i.e. loans granted to or fully, explicitly and unconditionally guaranteed by Member States, where no repayment difficulties are expected and for which an unexpected loss of 0 % is allocated. A+ denotes loans granted to (or guaranteed by) entities other than Member States, with no expectation of deterioration over their duration. A- includes those lending operations where there is some doubt about the maintenance of their current status (for instance because of a long maturity, or for the high volatility of the future price of an otherwise excellent collateral), but where any downside is expected to be quite limited.

| B | High quality loans: these represent an asset class with which the bank feels comfortable, although a minor deterioration is not ruled out in the future. B+ and B- are used to denote the relative likelihood of the possibility of such deterioration occurring. |
| --- | --- |

B

High quality loans: these represent an asset class with which the bank feels comfortable, although a minor deterioration is not ruled out in the future. B+ and B- are used to denote the relative likelihood of the possibility of such deterioration occurring.

| C | Good quality loans: an example could be unsecured loans to solid banks and corporates with a 7-year bullet, or equivalent amortising, maturity at disbursement. |
| --- | --- |

C

Good quality loans: an example could be unsecured loans to solid banks and corporates with a 7-year bullet, or equivalent amortising, maturity at disbursement.

| D | This rating class represents the borderline between ‘acceptable quality’ loans and those that have experienced some difficulties. This watershed in loan grading is more precisely determined by the sub-classifications D+ and D-. Loans rated D- require heightened monitoring. |
| --- | --- |

D

This rating class represents the borderline between ‘acceptable quality’ loans and those that have experienced some difficulties. This watershed in loan grading is more precisely determined by the sub-classifications D+ and D-. Loans rated D- require heightened monitoring.

| E | This LG category includes loans with a risk profile greater than generally accepted. It also includes loans which in the course of their lives have experienced severe problems and their sliding into a situation of loss cannot be excluded. For this reason, the loans are subject to close and high monitoring. The sub-classes E+ and E- differentiate the intensity of this special monitoring process, with those operations graded E- being in a position where there is a strong possibility that debt service cannot be maintained on a timely basis and therefore some form of debt restructuring is required, possibly leading to an impairment loss. |
| --- | --- |

E

This LG category includes loans with a risk profile greater than generally accepted. It also includes loans which in the course of their lives have experienced severe problems and their sliding into a situation of loss cannot be excluded. For this reason, the loans are subject to close and high monitoring. The sub-classes E+ and E- differentiate the intensity of this special monitoring process, with those operations graded E- being in a position where there is a strong possibility that debt service cannot be maintained on a timely basis and therefore some form of debt restructuring is required, possibly leading to an impairment loss.

| F | F (fail) denotes loans representing unacceptable risks. F- graded loans can only arise out of outstanding transactions that have experienced, after signature, unforeseen, exceptional and dramatic adverse circumstances. All operations where there is a loss of principal to the Facility are graded F and a specific provision is applied. |
| --- | --- |

F

F (fail) denotes loans representing unacceptable risks. F- graded loans can only arise out of outstanding transactions that have experienced, after signature, unforeseen, exceptional and dramatic adverse circumstances. All operations where there is a loss of principal to the Facility are graded F and a specific provision is applied.

Generally, loans internally graded D- or below are placed on the Watch List. However, if a loan was originally approved with a risk profile of D- or weaker, it will only be placed on the Watch List as a result of a material credit event causing a further deterioration of its LG classification.

The table in section 3.2.3.3 shows the credit quality analysis of the Facility’s loan portfolio based on the various LG classes as described above.

3.2.3.2.   Analysis of lending credit risk exposure

Analysis of lending credit risk exposure

The following table shows the maximum exposure to credit risk on loans signed and disbursed by nature of borrower taking into account guarantees provided by guarantors:

| (In EUR ’000) |
| --- |
| At 31.12.2017 | Guaranteed | Other credit enhancements | Not guaranteed | Total | % of Total |
| Banks | 46 860 | 11 651 | 919 216 | 977 727 | 59 % |
| Corporates | 145 914 | 59 462 | 285 492 | 490 868 | 29 % |
| Public institutions | 30 882 | — | — | 30 882 | 2 % |
| States | — | 3 218 | 164 030 | 167 248 | 10 % |
| Total disbursed | 223 656 | 74 331 | 1 368 738 | 1 666 725 | 100 % |
| Signed not disbursed | 89 597 | — | 780 385 | 869 983 | |

(In EUR ’000)

At 31.12.2017

Guaranteed

Other credit enhancements

Not guaranteed

Total

% of Total

Banks

46 860

11 651

919 216

977 727

977 727

59 %

59 %

Corporates

145 914

59 462

285 492

490 868

490 868

29 %

29 %

Public institutions

30 882

—

—

30 882

30 882

2 %

2 %

States

—

3 218

164 030

167 248

167 248

10 %

10 %

Total disbursed

Total disbursed

223 656

223 656

74 331

74 331

1 368 738

1 368 738

1 666 725

1 666 725

100 %

100 %

Signed not disbursed

Signed not disbursed

89 597

89 597

—

—

780 385

780 385

869 983

869 983

| (In EUR ’000) |
| --- |
| At 31.12.2016 | Guaranteed | Other credit enhancements | Not guaranteed | Total | % of Total |
| Banks | 22 691 | 34 597 | 933 609 | 990 897 | 57 % |
| Corporates | 110 849 | 97 213 | 320 406 | 528 468 | 31 % |
| Public institutions | 38 330 | — | — | 38 330 | 2 % |
| States | — | 3 764 | 167 921 | 171 685 | 10 % |
| Total disbursed | 171 870 | 135 574 | 1 421 936 | 1 729 380 | 100 % |
| Signed not disbursed | 94 976 | — | 806 923 | 901 899 | |

(In EUR ’000)

At 31.12.2016

Guaranteed

Other credit enhancements

Not guaranteed

Total

% of Total

Banks

22 691

34 597

933 609

990 897

990 897

57 %

57 %

Corporates

110 849

97 213

320 406

528 468

528 468

31 %

31 %

Public institutions

38 330

—

—

38 330

38 330

2 %

2 %

States

—

3 764

167 921

171 685

171 685

10 %

10 %

Total disbursed

Total disbursed

171 870

171 870

135 574

135 574

1 421 936

1 421 936

1 729 380

1 729 380

100 %

100 %

Signed not disbursed

Signed not disbursed

94 976

94 976

—

—

806 923

806 923

901 899

901 899

Transaction Management and Restructuring is tasked with the responsibility of performing borrower and guarantor monitoring, as well as project-related financial and contractual monitoring. Thus, the creditworthiness of the Facility’s loans, borrowers and guarantors are continually monitored, at least annually but more frequently on an as-needed basis and as a function of credit events taking place. In particular, Transaction Management and Restructuring reviews if contractual rights are met and, in case of a rating deterioration and/or contractual default, remedy action is taken. Mitigation measures are pursued, whenever necessary in accordance with the credit risk guidelines. Also, in case of renewals of bank guarantees received for its loans, it is ensured that these are replaced or action is taken in a timely manner.

3.2.3.3.   Credit quality analysis per type of borrower

Credit quality analysis per type of borrower

The tables below show the credit quality analysis of the Facility’s loan portfolio as at 31 December 2017 and 31 December 2016 by the Loan Grading applications, based on the exposure signed (disbursed and un-disbursed):

| (In EUR ’000) |
| --- |
| At 31.12.2017 | High Grade | Standard Grade | Min. Accept. Risk | High Risk | No grading | Total | % of Total |
| A to B- | C | D+ | D- and below |
| Borrower | Banks | 208 601 | 187 225 | 189 727 | 870 912 | — | 1 456 465 | 58 % |
| Corporates | 114 769 | 8 018 | 3 288 | 533 382 | 1 428 | 660 885 | 26 % |
| Public institutions | — | — | 30 882 | — | — | 30 882 | 1 % |
| States | — | — | 13 861 | 374 614 | — | 388 476 | 15 % |
| Total | 323 370 | 195 243 | 237 758 | 1 778 908 | 1 428 | 2 536 708 | 100 % |

(In EUR ’000)

At 31.12.2017

High Grade

Standard Grade

Min. Accept. Risk

High Risk

No grading

Total

% of Total

A to B-

C

D+

D- and below

Borrower

Banks

208 601

187 225

189 727

870 912

—

1 456 465

1 456 465

58 %

58 %

Corporates

114 769

8 018

3 288

533 382

1 428

660 885

660 885

26 %

26 %

Public institutions

—

—

30 882

—

—

30 882

30 882

1 %

1 %

States

—

—

13 861

374 614

—

388 476

388 476

15 %

15 %

Total

Total

323 370

323 370

195 243

195 243

237 758

237 758

1 778 908

1 778 908

1 428

1 428

2 536 708

2 536 708

100 %

100 %

| (In EUR ’000) |
| --- |
| At 31.12.2016 | High Grade | Standard Grade | Min. Accept. Risk | High Risk | No grading | Total | % of Total |
| A to B- | C | D+ | D- and below |
| Borrower | Banks | 94 081 | 53 970 | 315 524 | 1 038 705 | 126 951 | 1 629 231 | 62 % |
| Corporates | 125 810 | — | 19 389 | 393 877 | 152 355 | 691 431 | 26 % |
| Public institutions | — | — | 38 330 | — | — | 38 330 | 1 % |
| States | — | — | 18 131 | 254 156 | — | 272 287 | 11 % |
| Total | 219 891 | 53 970 | 391 374 | 1 686 738 | 279 306 | 2 631 279 | 100 % |

(In EUR ’000)

At 31.12.2016

High Grade

Standard Grade

Min. Accept. Risk

High Risk

No grading

Total

% of Total

A to B-

C

D+

D- and below

Borrower

Banks

94 081

53 970

315 524

1 038 705

126 951

1 629 231

1 629 231

62 %

62 %

Corporates

125 810

—

19 389

393 877

152 355

691 431

691 431

26 %

26 %

Public institutions

—

—

38 330

—

—

38 330

38 330

1 %

1 %

States

—

—

18 131

254 156

—

272 287

272 287

11 %

11 %

Total

Total

219 891

219 891

53 970

53 970

391 374

391 374

1 686 738

1 686 738

279 306

279 306

2 631 279

2 631 279

100 %

100 %

3.2.3.4.   Risk concentrations of loans and receivables

Risk concentrations of loans and receivables

3.2.3.4.1.   
  Geographical analysis

Geographical analysis

Based on the country of borrower, the Facility’s loan portfolio can be analysed by the following geographical regions (in EUR ‘000):

| Country of borrower | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Kenya | 331 891 | 341 805 |
| Nigeria | 230 042 | 241 547 |
| Uganda | 169 869 | 175 424 |
| Tanzania | 116 093 | 115 239 |
| Jamaica | 85 728 | 90 237 |
| Burundi | 74 703 | 87 373 |
| Mauritania | 64 007 | 85 008 |
| Congo (Democratic Republic) | 62 439 | 47 122 |
| Dominican Republic | 61 326 | 81 230 |
| Ethiopia | 51 719 | 59 837 |
| Ghana | 49 895 | 45 715 |
| Togo | 45 574 | 64 605 |
| Rwanda | 38 555 | 29 918 |
| Mauritius | 26 598 | 31 518 |
| Barbados | 25 124 | 6 809 |
| Cameroon | 25 012 | 41 255 |
| Malawi | 22 800 | 11 493 |
| New Caledonia | 21 670 | 2 191 |
| Cape Verde | 20 487 | 23 029 |
| Mozambique | 19 212 | 22 389 |
| French Polynesia | 17 235 | 21 387 |
| Cayman Islands | 14 958 | 11 221 |
| Angola | 14 850 | 19 |
| Senegal | 13 881 | 18 544 |
| Zambia | 10 910 | 11 079 |
| Botswana | 7 618 | 7 889 |
| Burkina Faso | 6 041 | 4 480 |
| Haiti | 6 006 | 6 879 |
| Niger | 5 631 | 523 |
| Mali | 5 612 | 6 159 |
| Samoa | 5 100 | 6 356 |
| Seychelles | 5 036 | 2 058 |
| Vanuatu | 2 162 | 2 470 |
| Namibia | 1 971 | — |
| Congo | 1 730 | 3 460 |
| Liberia | 1 553 | 1 759 |
| Palau | 1 384 | 1 929 |
| Micronesia | 868 | 1 088 |
| Regional-ACP | 751 | 15 640 |
| South Africa | 653 | 1 336 |
| Tonga | 31 | 46 |
| Trinidad and Tobago | — | 528 |
| Saint Lucia | — | 392 |
| Bahamas | — | 392 |
| Sint Maarten | — | 2 |
| Total | 1 666 725 | 1 729 380 |

Country of borrower

31.12.2017

31.12.2016

Kenya

331 891

341 805

Nigeria

230 042

241 547

Uganda

169 869

175 424

Tanzania

116 093

115 239

Jamaica

85 728

90 237

Burundi

74 703

87 373

Mauritania

64 007

85 008

Congo (Democratic Republic)

62 439

47 122

Dominican Republic

61 326

81 230

Ethiopia

51 719

59 837

Ghana

49 895

45 715

Togo

45 574

64 605

Rwanda

38 555

29 918

Mauritius

26 598

31 518

Barbados

25 124

6 809

Cameroon

25 012

41 255

Malawi

22 800

11 493

New Caledonia

21 670

2 191

Cape Verde

20 487

23 029

Mozambique

19 212

22 389

French Polynesia

17 235

21 387

Cayman Islands

14 958

11 221

Angola

14 850

19

Senegal

13 881

18 544

Zambia

10 910

11 079

Botswana

7 618

7 889

Burkina Faso

6 041

4 480

Haiti

6 006

6 879

Niger

5 631

523

Mali

5 612

6 159

Samoa

5 100

6 356

Seychelles

5 036

2 058

Vanuatu

2 162

2 470

Namibia

1 971

—

Congo

1 730

3 460

Liberia

1 553

1 759

Palau

1 384

1 929

Micronesia

868

1 088

Regional-ACP

751

15 640

South Africa

653

1 336

Tonga

31

46

Trinidad and Tobago

—

528

Saint Lucia

—

392

Bahamas

—

392

Sint Maarten

—

2

Total

Total

1 666 725

1 666 725

1 729 380

1 729 380

3.2.3.4.2.   
  Industry sector analysis

Industry sector analysis

The table below analyses the Facility’s loan portfolio by industry sector of the borrower. Operations which are first disbursed to a financial intermediary before being disbursed to the final beneficiary are reported under global loans (in EUR '000):

| Industry sector of borrower | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Tertiary and other | 991 282 | 1 027 202 |
| Electricity, coal and others | 290 364 | 283 489 |
| Urban development, renovation and transport | 194 101 | 205 152 |
| Basic material and mining | 59 462 | 82 242 |
| Roads and motorways | 40 960 | 48 600 |
| Airports and air traffic management systems | 30 882 | 38 330 |
| Telecommunications | 20 310 | 1 981 |
| Food chain | 15 586 | 14 257 |
| Oil, gas and petroleum | 12 466 | 8 384 |
| Waste recuperation | 8 018 | 7 988 |
| Materials processing, construction | 2 194 | 8 691 |
| Social infrastructure, education and health | 1 100 | 2 280 |
| Consumer goods | — | 784 |
| Total | 1 666 725 | 1 729 380 |

Industry sector of borrower

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Tertiary and other

991 282

1 027 202

Electricity, coal and others

290 364

283 489

Urban development, renovation and transport

194 101

205 152

Basic material and mining

59 462

82 242

Roads and motorways

40 960

48 600

Airports and air traffic management systems

30 882

38 330

Telecommunications

20 310

1 981

Food chain

15 586

14 257

Oil, gas and petroleum

12 466

8 384

Waste recuperation

8 018

7 988

Materials processing, construction

2 194

8 691

Social infrastructure, education and health

1 100

2 280

Consumer goods

—

784

Total

Total

1 666 725

1 666 725

1 729 380

1 729 380

3.2.3.5.   Arrears on loans and impairments

Arrears on loans and impairments

Amounts in arrears are identified, monitored and reported according to the procedures defined into the bank wide ‘Finance Monitoring Guidelines and Procedures’. These procedures are in line with best banking practices and are adopted for all loans managed by the EIB.

The monitoring process is structured in order to make sure that (i) potential arrears are detected and reported to the services in charge with minimum delay; (ii) critical cases are promptly escalated to the right operational and decision level; (iii) regular reporting to EIB management and to Member States is provided on the overall status of arrears and on the recovery measures already taken or to be taken.

The arrears and impairments on loans can be analysed as follows (in EUR '000):

| | | Loans and receivables | Loans and receivables |
| --- | --- | --- | --- |
| Notes | 31.12.2017 | 31.12.2016 |
| Carrying amount | | 1 666 725 | 1 729 380 |
| Individually impaired | | | |
| Gross amount | | 136 827 | 119 381 |
| Allowance for impairment | 7 | - 106 203 | - 117 640 |
| Carrying amount individually impaired | | 30 624 | 1 741 |
| Collectively impaired | | | |
| Gross amount | | — | — |
| Allowance for impairment | | — | — |
| Carrying amount collectively impaired | | — | — |
| Past due but not impaired | | | |
| Past due comprises | | | |
| 0-30 days | | 1 227 | 1 620 |
| 30-60 days | | 77 | 30 |
| 60-90 days | | 31 | — |
| 90-180 days | | 18 | — |
| more 180 days | | 1 | 1 |
| Carrying amount past due but not impaired | | 1 354 | 1 651 |
| Carrying amount neither past due nor impaired | | 1 634 747 | 1 725 988 |
| Total carrying amount loans and receivables | | 1 666 725 | 1 729 380 |

Loans and receivables

Loans and receivables

Notes

31.12.2017

31.12.2016

Carrying amount

Carrying amount

1 666 725

1 666 725

1 729 380

1 729 380

Individually impaired

Individually impaired

Gross amount

136 827

119 381

Allowance for impairment

7

- 106 203

- 117 640

Carrying amount individually impaired

Carrying amount individually impaired

30 624

30 624

1 741

1 741

Collectively impaired

Collectively impaired

Gross amount

—

—

Allowance for impairment

—

—

Carrying amount collectively impaired

Carrying amount collectively impaired

—

—

Past due but not impaired

Past due but not impaired

Past due comprises

Past due comprises

0-30 days

1 227

1 620

30-60 days

77

30

60-90 days

31

—

90-180 days

18

—

more 180 days

1

1

Carrying amount past due but not impaired

Carrying amount past due but not impaired

1 354

1 354

1 651

1 651

Carrying amount neither past due nor impaired

Carrying amount neither past due nor impaired

1 634 747

1 634 747

1 725 988

1 725 988

Total carrying amount loans and receivables

Total carrying amount loans and receivables

1 666 725

1 666 725

1 729 380

1 729 380

3.2.3.6.   Loan renegotiation and forbearance

Loan renegotiation and forbearance

The Facility considers loans to be forborne if in response to adverse changes in the financial position of a borrower the Facility renegotiates the original terms of the contractual arrangements with this borrower affecting directly the future cash flows of the financial instrument, which may result in a loss to the Facility. However, the financial impact of restructuring activities is in general limited to impairment losses, if any, as financial neutrality is generally applied by the Facility and reflected in the renegotiated pricing conditions of the operations restructured.

In the normal course of business, the Loan Grading (LG) of the loans in question would have deteriorated and the loan would have been included in the Watch List before renegotiation. Once renegotiated, the Facility will continue to closely monitor these loans. If the renegotiated payment terms will not recover the original carrying amount of the asset, it will be considered as impaired. The corresponding impairment losses will be calculated based on the forecasted cash flows discounted at the original effective interest rate. The need for impairment for all loans whose LG deteriorated to E- is assessed regularly; all loans with a LG of F require impairment. Once the Loan Grading of a loan has improved sufficiently, it will be removed from the Watch List in line with the procedures of the Facility.

Forbearance measures and practices undertaken by the Facility’s restructuring team during the reporting period includes extension of maturity, deferral of capital only, deferral of capital and interest and capitalisation of arrears. Such forbearance measures do not lead to the derecognition of the underlying operation.

Exposures subject to changes in contractual terms which do not affect future cash flows, such as collateral or other security arrangements or the waiver of contractual rights under covenants, are not considered as forborne and hence those events are not considered as sufficient to indicate impairment on their own.

Operations subject to forbearance measures are reported as such in the table below:

| (In EUR ’000) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| Number of operations subject to forbearance practices | 27 | 22 |
| Carrying values | 136 973 | 171 135 |
| of which impaired | 112 423 | 124 250 |
| Impairment recognised | 107 256 | 113 052 |
| Interest income in respect of forborn operations | 8 418 | 19 877 |
| Exposures written off (following the termination/sale of the operation) | 9 395 | 31 298 |

(In EUR ’000)

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Number of operations subject to forbearance practices

27

22

Carrying values

136 973

171 135

of which impaired

112 423

124 250

Impairment recognised

107 256

113 052

Interest income in respect of forborn operations

8 418

19 877

Exposures written off (following the termination/sale of the operation)

9 395

31 298

| (In EUR ’000) |
| --- |
| | Forbearance measures |
| 31.12.2016 | Extension of maturities | Deferral of capital only | Deferral of capital and interest | Other | Contractual repayment and termination (17) | 31.12.2017 |
| Banks | 37 276 | — | 2 886 | — | 5 490 | -15 305 | 30 347 |
| Corporates | 133 859 | 10 062 | 2 803 | — | 3 013 | -43 111 | 106 626 |
| Total | 171 135 | 10 062 | 5 689 | — | 8 503 | -58 416 | 136 973 |

(In EUR ’000)

Forbearance measures

31.12.2016

Extension of maturities

Deferral of capital only

Deferral of capital and interest

Other

Contractual repayment and termination (17)

17

31.12.2017

Banks

37 276

—

2 886

—

5 490

-15 305

30 347

Corporates

133 859

10 062

2 803

—

3 013

-43 111

106 626

Total

Total

171 135

171 135

10 062

10 062

5 689

5 689

—

—

8 503

8 503

-58 416

-58 416

136 973

136 973

3.2.4.   Credit risk on cash and cash equivalents

Credit risk on cash and cash equivalents

Available funds are invested in accordance with the Facility’s schedule of contractual disbursement obligations. As of 31 December 2017 and 31 December 2016, investments were in the form of bank deposits, certificates of deposit and commercial papers.

The authorised entities have a rating similar to the short-term and long-term ratings required for the EIB’s own treasury placements. In case of different ratings being granted by more than one credit rating agency, the lowest rating governs. The maximum authorised limit for each authorised bank is currently EUR 50 000 000 (fifty million euro). An exception to this rule has been granted to Societe Generale where the Facility has its operational cash accounts. The short term credit limit for Societe Generale as at 31 December 2017 and 31 December 2016 amounts to EUR 110 000 000 (one hundred and ten million euro). The increased limit applies to the sum of the cash held at the operational cash accounts and the instruments issued by this counterpart and held by the treasury portfolio.

All investments have been done with authorised entities with a maximum tenor of three months from value date. As at 31 December 2017 and 31 December 2016 all term deposits, commercial papers and cash in hand held by the treasury portfolio of the Facility had a minimum rating of P-1 (Moody’s equivalent) at settlement day.

The following table shows the situation of cash and cash equivalents including accrued interest (In EUR ’000):

| Minimum short-term rating | Minimum long-term rating | 31.12.2017 | 31.12.2016 |
| --- | --- | --- | --- |
| (Moody’s term) | (Moody’s term) |
| P-1 | Aaa | 49 616 | 9 % | 37 949 | 10 % |
| P-1 | Aa2 | — | 0 % | 46 963 | 13 % |
| P-1 | Aa3 | 89 971 | 16 % | 40 436 | 11 % |
| P-1 | A1 | 143 080 | 26 % | 100 012 | 28 % |
| P-1 | A2 | 266 434 | 49 % | 135 457 | 38 % |
| Total | 549 101 | 100 % | 360 817 | 100 % |

Minimum short-term rating

Minimum long-term rating

31.12.2017

31.12.2016

(Moody’s term)

(Moody’s term)

P-1

Aaa

49 616

9 %

37 949

10 %

P-1

Aa2

—

0 %

46 963

13 %

P-1

Aa3

89 971

16 %

40 436

11 %

P-1

A1

143 080

26 %

100 012

28 %

P-1

A2

266 434

49 %

135 457

38 %

Total

Total

549 101

549 101

100 %

100 %

360 817

360 817

100 %

100 %

3.2.5.   Credit risk on derivatives

Credit risk on derivatives

3.2.5.1.   Credit risk policy of derivatives

Credit risk policy of derivatives

The credit risk with respect to derivatives is represented by the loss which a given party would incur where the other counterparty to the deal would be unable to honour its contractual obligations. The credit risk associated with derivatives varies according to a number of factors (such as interest and exchange rates) and generally corresponds to only a small portion of their notional value.

In the normal course of its activity, the Facility may enter into swap contracts with a view to hedge specific lending operations or into currency forward contracts, with a view to hedge its currency positions denominated in actively traded currencies other than the Euro. All the swaps are executed by the European Investment Bank with an external counterpart. The swaps are arranged by the same Master Swap Agreements and Credit Support Annexes signed between the European Investment Bank and its external counterparts.

3.2.5.2.   Credit risk measurement for derivatives

Credit risk measurement for derivatives

All the swaps executed by the European Investment Bank that are related to the Facility are treated within the same contractual framework and methodologies applied for the derivatives negotiated by the European Investment Bank for its own purposes. In particular, eligibility of swap counterparts is determined by the European Investment Bank based on the same eligibility conditions applied for its general swap purposes.

The European Investment Bank measures the credit risk exposure related to swaps and derivatives transactions using the Net Market Exposure (‘NME’) and Potential Future Exposure (‘PFE’) approach for reporting and limit monitoring. The NME and the PFE fully include the derivatives related to the Investment Facility.

| — | The following table shows the maturities of cross currency interest rate swaps, sub-divided according to their notional amount and fair value:










  (In EUR ’000) |
| --- | --- |
| Swap contracts at 31.12.2017 | less than | 1 year | 5 years | more than | Total 2017 |
| 1 year | to 5 years | to 10 years | to 10 years |
| Notional amount | — | 8 098 | — | — | 8 098 |
| Fair Value (i.e. net discounted value) | — | - 955 | — | — | - 955 |

—

The following table shows the maturities of cross currency interest rate swaps, sub-divided according to their notional amount and fair value:

(In EUR ’000)

Swap contracts at 31.12.2017

less than

1 year

5 years

more than

Total 2017

1 year

to 5 years

to 10 years

to 10 years

Notional amount

—

8 098

—

—

8 098

8 098

Fair Value (i.e. net discounted value)

—

- 955

—

—

- 955

- 955

| (In EUR ’000) |
| --- |
| Swap contracts at 31.12.2016 | less than | 1 year | 5 years | more than | Total 2016 |
| 1 year | to 5 years | to 10 years | to 10 years |
| Notional amount | — | 7 430 | — | — | 7 430 |
| Fair Value (i.e. net discounted value) | — | -3 051 | — | — | -3 051 |

(In EUR ’000)

Swap contracts at 31.12.2016

less than

1 year

5 years

more than

Total 2016

1 year

to 5 years

to 10 years

to 10 years

Notional amount

—

7 430

—

—

7 430

7 430

Fair Value (i.e. net discounted value)

—

-3 051

—

—

-3 051

-3 051

| — | The Facility enters into foreign exchange short term currency swaps (‘FX swaps’) contracts in order to hedge currency risk on loan disbursements in currencies other than EUR. FX swaps have a maturity of maximum three months and are regularly rolled-over. The notional amount of FX swaps stood at EUR 1 500,0 million at 31 December 2017 against EUR 1 611,0 million at 31 December 2016. The fair value of FX swaps amounts to EUR 12,0 million at 31 December 2017 against EUR -15,3 million at 31 December 2016. |
| --- | --- |

—

The Facility enters into foreign exchange short term currency swaps (‘FX swaps’) contracts in order to hedge currency risk on loan disbursements in currencies other than EUR. FX swaps have a maturity of maximum three months and are regularly rolled-over. The notional amount of FX swaps stood at EUR 1 500,0 million at 31 December 2017 against EUR 1 611,0 million at 31 December 2016. The fair value of FX swaps amounts to EUR 12,0 million at 31 December 2017 against EUR -15,3 million at 31 December 2016.

| — | The Facility enters into interest rate swap contracts in order to hedge the interest rate risk on loans disbursed. As at 31 December 2017 there are two interest rate swaps outstanding with a notional amount of EUR 31,7 million (2016: EUR 41,2 million) and a fair value of EUR 0,3 million (2016: EUR 0,1 million). |
| --- | --- |

—

The Facility enters into interest rate swap contracts in order to hedge the interest rate risk on loans disbursed. As at 31 December 2017 there are two interest rate swaps outstanding with a notional amount of EUR 31,7 million (2016: EUR 41,2 million) and a fair value of EUR 0,3 million (2016: EUR 0,1 million).

3.2.6.   Credit risk on held-to-maturity financial assets

Credit risk on held-to-maturity financial assets

The following table shows the situation of the held-to-maturity portfolio entirely composed of treasury bills and bonds issued or guaranteed by Italy, Portugal and Spain with remaining maturities of up to three months. EU Member States, their agencies, banks and non-bank entities are eligible issuers. The maximum authorised limit for each authorised issuer is EUR 50 000 000 (fifty million euro). Investments in medium and long-term bonds could also be eligible, according to the investment guidelines and depending on liquidity requirements:

| Minimum short-term rating | Minimum long-term rating | 31.12.2017 | 31.12.2016 |
| --- | --- | --- | --- |
| (Moody’s term) | (Moody’s term) |
| P-1 | Aa2 | — | 0 % | 18 012 | 10 % |
| P-1 | A1 | — | 0 % | 30 002 | 18 % |
| P-2 | Non-Rated | — | 0 % | 20 025 | 12 % |
| P-2 | Baa2 | 94 353 | 65 % | — | 0 % |
| NP | Ba1 | 50 029 | 35 % | 50 005 | 30 % |
| Non-Rated | Baa2 | — | 0 % | 51 354 | 30 % |
| Total | 144 382 | 100 % | 169 398 | 100 % |

Minimum short-term rating

Minimum long-term rating

31.12.2017

31.12.2017

31.12.2016

31.12.2016

(Moody’s term)

(Moody’s term)

P-1

Aa2

—

0 %

18 012

10 %

P-1

A1

—

0 %

30 002

18 %

P-2

Non-Rated

—

0 %

20 025

12 %

P-2

Baa2

94 353

65 %

—

0 %

NP

Ba1

50 029

35 %

50 005

30 %

Non-Rated

Baa2

—

0 %

51 354

30 %

Total

Total

144 382

144 382

100 %

100 %

169 398

169 398

100 %

100 %

3.3.   Liquidity risk

Liquidity risk refers to an enitity’s ability to fund increases in assets and meet obligations as they come due, without incurring unacceptable losses. It can be split into funding liquidity risk and market liquidity risk. Funding liquidity risk is the risk that an entity will not be able to meet efficiently both expected and unexpected current and future cash flow needs without affecting its daily operations or its financial condition. Market liquidity risk is the risk that an entity cannot easily offset or eliminate a position at the market price because of inadequate market depth or market disruption.

3.3.1.   Liquidity risk management

Liquidity risk management

The Facility is primarily funded by annual contributions from Member States as well as by reflows stemming from the Facility’s operations. The Facility manages its funding liquidity risk primarily by planning of its net liquidity needs and the required Member States annual contributions.

In order to calculate Member States’ annual contributions, disbursement patterns of the existing and pipelined portfolio is analysed and followed up throughout the year. Special events, such as early reimbursements, sales of shares or default cases are taken into account to correct annual liquidity requirements.

To further minimise the liquidity risk, the Facility maintains a liquidity reserve sufficient to cover at any point in time forecasted cash disbursements, as communicated periodically by EIB’s Lending Department. Funds are invested on the money market and bond markets in the form of interbank deposits and other short term financial instruments by taking into consideration the Facility’s cash disbursement obligations. The Facility’s liquid assets are managed by the Bank’s Treasury Department with a view to maintain appropriate liquidity to enable the Facility to meet its obligations.

In accordance with the principle of segregation of duties between the Front and Back Office, settlement operations related to the investment of these assets are under the responsibility of the EIB’s Planning and Settlement of Operations Department. Furthermore, the authorisation of counterparts and limits for treasury investments, as well as the monitoring of such limits, are the responsibility of the Bank’s Risk Management Directorate.

3.3.2.   Liquidity risk measurement

Liquidity risk measurement

The tables in this section analyse the financial liabilities of the Facility by maturity on the basis of the period remaining between the balance sheet date and the contractual maturity date (based on undiscounted cash flows).

In terms of non-derivative financial liabilities, the Facility holds commitments in form of un-disbursed portions of the credit under signed loan agreements, of un-disbursed portions of signed capital subscription/investment agreements, of loan guarantees granted, or of committed interest subsidies and TA.

Loans under the IF have a disbursement deadline. However, disbursements are made at times and in amounts reflecting the progress of underlying investment projects. Moreover, the IF’s loans are transactions performed in a relatively volatile operating environment, hence their disbursement schedule is subject to a significant degree of uncertainty.

Capital investments become due when and as soon as equity fund managers issue valid calls for capital, reflecting the progress in their investment activities. The drawdown period is usually of 3 years, with frequent prolongation by one or two years. Some disbursement commitments usually survive the end of the drawdown period until full disposal of the fund’s underlying investments, as the fund’s liquidity may be insufficient from time to time to meet payment obligations arising in respect of fees or other expenses.

Guarantees are not subject to specific disbursement commitments unless a guarantee is called. The amount of guarantees outstanding is reduced alongside the repayment schedule of guaranteed loans.

Committed interest subsidies’ cash outflows occur in the case of subsidised loans financed by the Bank’s own resources. Therefore, reported outflows represent only commitments related to these loans rather than the total amount of committed un-disbursed interest subsidies. As in the case of loans, their disbursement schedule is uncertain.

Committed TA ‘gross nominal outflow’ in the ‘Maturity profile of non-derivative financial liabilities’ table refers to the total un-disbursed portion of signed TA contracts. The disbursement time pattern is subject to a significant degree of uncertainty. Cash outflows classified in the ‘3 months or less’ bucket represent the amount of outstanding invoices received by the reporting date.

Commitments for non-derivative financial liabilities for which there is no defined contractual maturity date are classified under ‘Maturity Undefined’. Commitments, for which there is a recorded cash disbursement request at the reporting date, are classified under the relevant time bucket.

In terms of derivative financial liabilities, the maturity profile represents the contractual undiscounted gross cash flows of swap contracts including cross currency swaps (CCS), cross currency interest rate swaps (CCIRS), short term currency swaps and interest rate swaps.

| Maturity profile of non-derivative financial liabilities | 3 months or less | More than 3 months to 1 year | More than 1 year to 5 years | More than 5 years | Maturity Undefined | Gross nominal outflow |
| --- | --- | --- | --- | --- | --- | --- |
| In EUR ’000 as at 31.12.2017 |
| Outflows for committed but un-disbursed loans | 5 543 | — | — | — | 864 440 | 869 983 |
| Outflows for committed investment funds and share subscription | 5 039 | — | — | — | 316 656 | 321 695 |
| Others (signed non-issued guarantees, issued guarantees) | — | — | — | — | 82 251 | 82 251 |
| Outflows for committed interest subsidies | 1 245 | — | — | — | 286 066 | 287 311 |
| Outflows for committed TA | 1 931 | — | — | — | 24 720 | 26 651 |
| Total | 13 758 | — | — | — | 1 574 133 | 1 587 891 |

Maturity profile of non-derivative financial liabilities

3 months or less

More than 3 months to 1 year

More than 1 year to 5 years

More than 5 years

Maturity Undefined

Gross nominal outflow

In EUR ’000 as at 31.12.2017

Outflows for committed but un-disbursed loans

5 543

—

—

—

864 440

869 983

Outflows for committed investment funds and share subscription

5 039

—

—

—

316 656

321 695

Others (signed non-issued guarantees, issued guarantees)

—

—

—

—

82 251

82 251

Outflows for committed interest subsidies

1 245

—

—

—

286 066

287 311

Outflows for committed TA

1 931

—

—

—

24 720

26 651

Total

Total

13 758

13 758

—

—

—

1 574 133

1 574 133

1 587 891

1 587 891

| Maturity profile of non-derivative financial liabilities | 3 months or less | More than 3 months to 1 year | More than 1 year to 5 years | More than 5 years | Maturity Undefined | Gross nominal outflow |
| --- | --- | --- | --- | --- | --- | --- |
| In EUR ’000 as at 31.12.2016 |
| Outflows for committed but un-disbursed loans | 82 405 | — | — | — | 819 494 | 901 899 |
| Outflows for committed investment funds and share subscription | 4 592 | — | — | — | 239 458 | 244 050 |
| Others (signed non-issued guarantees, issued guarantees) | — | — | — | — | 43 964 | 43 964 |
| Outflows for committed interest subsidies | — | — | — | — | 275 917 | 275 917 |
| Outflows for committed TA | 2 671 | — | — | — | 24 807 | 27 478 |
| Total | 89 668 | — | — | — | 1 403 640 | 1 493 308 |

Maturity profile of non-derivative financial liabilities

3 months or less

More than 3 months to 1 year

More than 1 year to 5 years

More than 5 years

Maturity Undefined

Gross nominal outflow

In EUR ’000 as at 31.12.2016

Outflows for committed but un-disbursed loans

82 405

—

—

—

819 494

901 899

Outflows for committed investment funds and share subscription

4 592

—

—

—

239 458

244 050

Others (signed non-issued guarantees, issued guarantees)

—

—

—

—

43 964

43 964

Outflows for committed interest subsidies

—

—

—

—

275 917

275 917

Outflows for committed TA

2 671

—

—

—

24 807

27 478

Total

Total

89 668

89 668

—

—

—

1 403 640

1 403 640

1 493 308

1 493 308

| Maturity profile of derivative financial liabilities | 3 months or less | More than 3 months to 1 year | More than 1 year to 5 years | More than 5 years | Gross nominal inflow/outflow |
| --- | --- | --- | --- | --- | --- |
| In EUR ’000 as at 31.12.2017 |
| CCS and CCIRS — Inflows | 7 | 3 144 | 5 122 | — | 8 273 |
| CCS and CCIRS — Outflows | — | -4 051 | -5 959 | — | -10 010 |
| Short term currency swaps — Inflows | 1 500 000 | — | — | — | 1 500 000 |
| Short term currency swaps — Outflows | -1 493 987 | — | — | — | -1 493 987 |
| Interest Rate Swaps — Inflows | 355 | 1 102 | 4 138 | 625 | 6 219 |
| Interest Rate Swaps — Outflows | — | -1 502 | -3 782 | - 556 | -5 840 |
| Total | 6 375 | -1 307 | - 482 | 69 | 4 655 |

Maturity profile of derivative financial liabilities

3 months or less

More than 3 months to 1 year

More than 1 year to 5 years

More than 5 years

Gross nominal inflow/outflow

In EUR ’000 as at 31.12.2017

CCS and CCIRS — Inflows

7

3 144

5 122

—

8 273

CCS and CCIRS — Outflows

—

-4 051

-5 959

—

-10 010

Short term currency swaps — Inflows

1 500 000

—

—

—

1 500 000

Short term currency swaps — Outflows

-1 493 987

—

—

—

-1 493 987

Interest Rate Swaps — Inflows

355

1 102

4 138

625

6 219

Interest Rate Swaps — Outflows

—

-1 502

-3 782

- 556

-5 840

Total

Total

6 375

6 375

-1 307

-1 307

- 482

- 482

69

69

4 655

4 655

| Maturity profile of derivative financial liabilities | 3 months or less | More than 3 months to 1 year | More than 1 year to 5 years | More than 5 years | Gross nominal inflow/outflow |
| --- | --- | --- | --- | --- | --- |
| In EUR ’000 as at 31.12.2016 |
| CCS and CCIRS — Inflows | 3 | 2 409 | 5 222 | — | 7 634 |
| CCS and CCIRS — Outflows | — | -3 688 | -7 377 | — | -11 065 |
| Short term currency swaps — Inflows | 1 611 000 | — | — | — | 1 611 000 |
| Short term currency swaps — Outflows | -1 636 001 | — | — | — | -1 636 001 |
| Interest Rate Swaps — Inflows | 411 | 1 234 | 5 529 | 1 550 | 8 724 |
| Interest Rate Swaps — Outflows | — | -1 962 | -5 316 | -1 329 | -8 607 |
| Total | -24 587 | -2 007 | -1 942 | 221 | -28 315 |

Maturity profile of derivative financial liabilities

3 months or less

More than 3 months to 1 year

More than 1 year to 5 years

More than 5 years

Gross nominal inflow/outflow

In EUR ’000 as at 31.12.2016

CCS and CCIRS — Inflows

3

2 409

5 222

—

7 634

CCS and CCIRS — Outflows

—

-3 688

-7 377

—

-11 065

Short term currency swaps — Inflows

1 611 000

—

—

—

1 611 000

Short term currency swaps — Outflows

-1 636 001

—

—

—

-1 636 001

Interest Rate Swaps — Inflows

411

1 234

5 529

1 550

8 724

Interest Rate Swaps — Outflows

—

-1 962

-5 316

-1 329

-8 607

Total

Total

-24 587

-24 587

-2 007

-2 007

-1 942

-1 942

221

221

-28 315

-28 315

3.3.3.   Long-term financial assets and liabilities

Long-term financial assets and liabilities

The following table sets out the carrying amounts of non-derivative financial assets and financial liabilities expected to be recovered or settled more than 12 months after the reporting date.

| (In EUR ’000) |
| --- |
| | 31.12.2017 | 31.12.2016 |
| Financial assets: | | |
| Loans and receivables | 1 608 488 | 1 692 867 |
| Available-for-sale financial assets | 497 539 | 516 884 |
| Other assets | 318 | 141 |
| Total | 2 106 345 | 2 209 892 |
| Financial liabilities: | | |
| Provisions for guarantees issued | 549 | 497 |
| Amount owed to third parties | 109 004 | 69 960 |
| Total | 109 553 | 70 457 |

(In EUR ’000)

31.12.2017

31.12.2017

31.12.2016

31.12.2016

Financial assets:

Financial assets:

Loans and receivables

1 608 488

1 692 867

Available-for-sale financial assets

497 539

516 884

Other assets

318

141

Total

Total

2 106 345

2 106 345

2 209 892

2 209 892

Financial liabilities:

Financial liabilities:

Provisions for guarantees issued

549

497

Amount owed to third parties

109 004

69 960

Total

Total

109 553

109 553

70 457

70 457

3.4.   Market risk

Market risk represents the risk that changes in market prices and rates, such as interest rates, equity prices and foreign exchange rates will affect an entity’s income or the value of its holdings in financial instruments.

3.4.1.   Interest rate risk

Interest rate risk

Interest rate risk arises from the volatility in the economic value of, or in the income derived from, interest rate bearing positions due to adverse movements in interest rates.

The Facility is not directly impacted by the fluctuation of its economic value or to pricing mismatches between different assets, liabilities and hedge instruments because (i) it does not have any direct borrowing costs or interest rate bearing liabilities and (ii) it accepts the impact of interest rate fluctuations on the revenues from its investments.

The Facility measures the sensitivity of its loan portfolio and micro hedging swaps to interest rate fluctuations via a Basis Point Value (BPV) calculation.

The BPV measures the gain or loss in the net present value of the relevant portfolio, due to a 1 basis point (0,01 %) increase in interest rates tenors ranging within a specified time bucket ‘money market — up to one year’, ‘very short — 2 to 3 years’, ‘short — 4 to 6 years’, ‘medium — 7 to 11 years’, ‘long — 12 to 20 years’ or ‘extra-long — more than 21 years’.

To determine the net present value (NPV) of the loans’ cash flows denominated in EUR, the Facility uses the EIB’s EUR base funding curve (EUR swap curve adjusted with EIB’s global funding spread). The EIB’s USD funding curve is used for the calculation of the NPV of loan’s cash flows denominated in USD. The NPV of the loans’ cash flows denominated in currencies for which a reliable and sufficiently complete discount curve is not available, is determined by using EIB’s EUR base funding curve as a proxy.

To calculate the net present value of the micro hedging swaps, the facility uses the EUR swap curve for cash flows denominated in EUR and the USD swap curve for cash flows denominated in USD.

As shown in the following table the net present value of the loan portfolio including related micro-hedging swaps as at 31 December 2017 would decrease by EUR 488k (as at 31 December 2016: decrease by EUR 516k) if all relevant interest rates curves are simultaneously shifted upwards in parallel by 1 basis point.

| Basis point value | Money | Very Short | Short | Medium | Long | Extra Long | Total |
| --- | --- | --- | --- | --- | --- | --- | --- |
| In EUR ’000 | Market |
| As at 31.12.2017 | 1 year | 2 to 3 years | 4 to 6 years | 7 to 11 years | 12 to 20 years | 21 years |
| Total sensitivity of loans and micro hedging swaps | - 49 | - 96 | - 159 | - 168 | - 16 | — | - 488 |

Basis point value

Money

Very Short

Short

Medium

Long

Extra Long

Total

In EUR ’000

Market

As at 31.12.2017

1 year

2 to 3 years

4 to 6 years

7 to 11 years

12 to 20 years

21 years

Total sensitivity of loans and micro hedging swaps

- 49

- 96

- 159

- 168

- 16

—

- 488

| Basis point value | Money | Very Short | Short | Medium | Long | Extra Long | Total |
| --- | --- | --- | --- | --- | --- | --- | --- |
| In EUR ’000 | Market |
| As at 31.12.2016 | 1 year | 2 to 3 years | 4 to 6 years | 7 to 11 years | 12 to 20 years | 21 years |
| Total sensitivity of loans and micro hedging swaps | - 46 | - 101 | - 164 | - 175 | - 30 | — | - 516 |

Basis point value

Money

Very Short

Short

Medium

Long

Extra Long

Total

In EUR ’000

Market

As at 31.12.2016

1 year

2 to 3 years

4 to 6 years

7 to 11 years

12 to 20 years

21 years

Total sensitivity of loans and micro hedging swaps

- 46

- 101

- 164

- 175

- 30

—

- 516

3.4.2.   Foreign exchange risk

Foreign exchange risk

Foreign exchange (‘FX’) risk for the IF is the risk of loss in earnings or economic value due to adverse movements of FX rates.

Given a reference accounting currency (EUR for the IF), the Facility is exposed to FX risk whenever there is a mismatch between assets and liabilities denominated in a non-reference accounting currency. FX risk also includes the effect of changes in the value of future cash flows denominated in non-reference accounting currency, e.g. interest and dividend payments, due to fluctuations in exchange rates.

3.4.2.1.   Foreign exchange risk and treasury assets

Foreign exchange risk and treasury assets

The IF’s treasury assets are denominated either in EUR or USD.

FX risk is hedged by means of FX cross currency spot or forward transactions, FX swaps or cross-currency swaps. The EIB’s Treasury Department can, where deemed necessary and appropriate, use any other instrument, in line with the Bank’s policy, that provide protection against market risks incurred in connection with the IF’s financial activities.

3.4.2.2.   Foreign exchange risk and operations financed or guaranteed by the IF

Foreign exchange risk and operations financed or guaranteed by the IF

Member States’ IF contributions are received in EUR. The operations financed or guaranteed by the IF as well as interest subsidies can be denominated in EUR, USD or any other authorised currency.

A foreign exchange risk exposure (against the EUR reference currency) arises whenever transactions denominated in currencies other than the EUR are left un-hedged. The IF’s foreign exchange risk hedging guidelines are set out below.

3.4.2.2.1.   
  Hedging of operations denominated in USD

Hedging of operations denominated in USD

The FX risk generated by IF operations denominated in USD shall be covered on an aggregated basis via the use of USD/EUR FX swaps, rolled over and adjusted in terms of amount on a periodic basis. The use of FX swaps serves a dual purpose. On one side the necessary liquidity for new disbursements (loans and equity) is generated and on the other side an FX macro hedging is maintained.

At the beginning of each period, the cash flows to be received or paid in USD during the next period shall be estimated on the basis of planned or expected reflows/disbursements. Subsequently, the maturing FX swaps shall be rolled over, their amount being adjusted to cover at least the USD liquidity needs projected over the next period.

| — | On a monthly basis, the USD FX position shall be hedged, if exceeding the relevant limits, by means of a spot or forward operation. |
| --- | --- |

—

On a monthly basis, the USD FX position shall be hedged, if exceeding the relevant limits, by means of a spot or forward operation.

| — | Within a roll-over period, unexpected USD liquidity deficits shall be covered by means of ad hoc FX swap operations while liquidity surpluses shall either be invested in treasury assets or converted into EUR if occurred from an increase of the FX position. |
| --- | --- |

—

Within a roll-over period, unexpected USD liquidity deficits shall be covered by means of ad hoc FX swap operations while liquidity surpluses shall either be invested in treasury assets or converted into EUR if occurred from an increase of the FX position.

3.4.2.2.2.   
  Hedging of operations denominated in currencies other than EUR or USD

Hedging of operations denominated in currencies other than EUR or USD

| — | IF operations denominated in currencies other than EUR and USD shall be hedged through cross-currency swap contracts with the same financial profile as the underlying Loan, provided that a swap market is operational. |
| --- | --- |

—

IF operations denominated in currencies other than EUR and USD shall be hedged through cross-currency swap contracts with the same financial profile as the underlying Loan, provided that a swap market is operational.

| — | IF has operations denominated in currencies for which hedging possibilities are either not efficiently available or available at a high cost. These operations are denominated in local currencies (LCs) but settled in EUR or USD. IF’s financial risk framework, which was approved by the IF Committee on 22 January 2015, offers the possibility to hedge the FX exposure in LCs that exhibit a significant positive correlation with the USD synthetically via USD-denominated derivatives. The LCs hedged synthetically with USD denominated derivatives are reported in the table in section 3.4.2.2.3 below under item ‘Local currencies (under synthetic hedge)’, while the LCs not hedged synthetically with the USD are reported in the same table under item ‘Local currencies (not under synthetic hedge)’. |
| --- | --- |

—

IF has operations denominated in currencies for which hedging possibilities are either not efficiently available or available at a high cost. These operations are denominated in local currencies (LCs) but settled in EUR or USD. IF’s financial risk framework, which was approved by the IF Committee on 22 January 2015, offers the possibility to hedge the FX exposure in LCs that exhibit a significant positive correlation with the USD synthetically via USD-denominated derivatives. The LCs hedged synthetically with USD denominated derivatives are reported in the table in section 3.4.2.2.3 below under item ‘Local currencies (under synthetic hedge)’, while the LCs not hedged synthetically with the USD are reported in the same table under item ‘Local currencies (not under synthetic hedge)’.

3.4.2.2.3.   
  Foreign exchange position (in EUR '000)

Foreign exchange position (in EUR '000)

The tables of this note show the Facility’s foreign exchange position.

The foreign exchange position is presented in the tables below in accordance with the IF’s Risk Policies (as described in the IF’s financial risk framework). The FX position as per Risk Policies is based on accounting figures and defined as the balance between selected assets and liabilities. The assets and liabilities defined in the FX position as per Risk Policies are selected so as to ensure that the earnings will only be converted into the reporting currency (EUR) when received.

The unrealised gains/losses and impairment on available-for-sale financial assets are included in the FX position as per Risk Policies, as well as impairments on loans and receivables. Derivatives included in the FX position as per Risk Policies are considered at their nominal value instead of their fair value, in order to be aligned with the retained value of the assets, considered also at their nominal value adjusted by the impairment for loans.

In the tables below the remaining part of the assets and liabilities, which includes mainly interest accruals on loans, derivatives and subsidies, is presented as ‘FX position excluded from Risk Policies’.

| At 31 December 2017 | Assets and liabilities | Commitments and contingent liabilities |
| --- | --- | --- |
| Currencies | FX position as per Risk Policies | FX position excluded from Risk Policies | Balance sheet FX position |
| USD | - 206 535 | 6 087 | - 200 448 | 377 994 |
| Local currencies


  (under synthetic hedge)
   (*2) | | | | |
| KES | 88 532 | 2 854 | 91 386 | — |
| TZS | 98 722 | 1 820 | 100 542 | — |
| DOP | 37 785 | 1 494 | 39 279 | — |
| UGX | 52 653 | 1 505 | 54 158 | — |
| RWF | 32 714 | 354 | 33 068 | — |
| Local currencies


  (not under synthetic hedge)
   (*2) | | | | |
| HTG, MUR, MZN, XOF, ZMW, BWP | 30 802 | 183 | 30 985 | — |
| Total non-EUR currencies | 134 673 | 14 297 | 148 970 | 377 994 |
| EUR | — | 2 688 497 | 2 688 497 | 1 278 511 |
| Total EUR and non-EUR | 134 673 | 2 702 794 | 2 837 467 | 1 656 505 |

At 31 December 2017

Assets and liabilities

Commitments and contingent liabilities

Currencies

FX position as per Risk Policies

FX position excluded from Risk Policies

Balance sheet FX position

USD

USD

- 206 535

6 087

- 200 448

377 994

Local currencies

Local currencies

(under synthetic hedge)
   (*2)

(under synthetic hedge)

*2

KES

KES

88 532

2 854

91 386

—

TZS

TZS

98 722

1 820

100 542

—

DOP

DOP

37 785

1 494

39 279

—

UGX

UGX

52 653

1 505

54 158

—

RWF

RWF

32 714

354

33 068

—

Local currencies

Local currencies

(not under synthetic hedge)
   (*2)

(not under synthetic hedge)

*2

HTG, MUR, MZN, XOF, ZMW, BWP

HTG, MUR, MZN, XOF, ZMW, BWP

30 802

183

30 985

—

Total non-EUR currencies

Total non-EUR currencies

134 673

134 673

14 297

14 297

148 970

148 970

377 994

377 994

EUR

EUR

—

2 688 497

2 688 497

2 688 497

2 688 497

1 278 511

1 278 511

Total EUR and non-EUR

Total EUR and non-EUR

134 673

134 673

2 702 794

2 702 794

2 837 467

2 837 467

1 656 505

1 656 505

| At 31 December 2016 | Assets and liabilities | Commitments and contingent liabilities |
| --- | --- | --- |
| Currencies | FX position as per Risk Policies | FX position excluded from Risk Policies | Balance sheet FX position |
| USD | - 258 496 | 7 578 | - 250 918 | 282 991 |
| Local currencies


  (under synthetic hedge)
   (*3) | | | | |
| KES | 117 881 | 3 869 | 121 751 | — |
| TZS | 97 116 | 1 931 | 99 046 | — |
| DOP | 52 553 | 2 013 | 54 566 | — |
| UGX | 36 776 | 1 077 | 37 854 | — |
| RWF | 22 258 | 194 | 22 452 | — |
| Local currencies


  (not under synthetic hedge)
   (*3) | | | | |
| HTG, MUR, MZN, XOF, ZMW | 22 534 | 252 | 22 786 | 246 |
| Total non-EUR currencies | 90 622 | 16 914 | 107 537 | 283 237 |
| EUR | — | 2 591 845 | 2 591 845 | 1 241 229 |
| Total EUR and non-EUR | 90 622 | 2 608 759 | 2 699 382 | 1 524 466 |

At 31 December 2016

Assets and liabilities

Commitments and contingent liabilities

Currencies

FX position as per Risk Policies

FX position excluded from Risk Policies

Balance sheet FX position

USD

USD

- 258 496

7 578

- 250 918

282 991

Local currencies

Local currencies

(under synthetic hedge)
   (*3)

(under synthetic hedge)

*3

KES

KES

117 881

3 869

121 751

—

TZS

TZS

97 116

1 931

99 046

—

DOP

DOP

52 553

2 013

54 566

—

UGX

UGX

36 776

1 077

37 854

—

RWF

RWF

22 258

194

22 452

—

Local currencies

Local currencies

(not under synthetic hedge)
   (*3)

(not under synthetic hedge)

*3

HTG, MUR, MZN, XOF, ZMW

HTG, MUR, MZN, XOF, ZMW

22 534

252

22 786

246

Total non-EUR currencies

Total non-EUR currencies

90 622

90 622

16 914

16 914

107 537

107 537

283 237

283 237

EUR

EUR

—

2 591 845

2 591 845

2 591 845

2 591 845

1 241 229

1 241 229

Total EUR and non-EUR

Total EUR and non-EUR

90 622

90 622

2 608 759

2 608 759

2 699 382

2 699 382

1 524 466

1 524 466

3.4.2.3.   Foreign exchange sensitivity analysis

Foreign exchange sensitivity analysis

As at 31 December 2017 a 10 percent depreciation of EUR versus all non EUR currencies would result in an increase of the contributors’ resources amounting to EUR 16,6 million (31 December 2016: EUR 12,0 million). A 10 percent appreciation of the EUR versus all non-EUR currencies would result in a decrease of the contributors’ resources amounting to EUR 13,6 million (31 December 2016: EUR 9,9 million).

3.4.2.4.   Conversion rates

Conversion rates

The following conversion rates were used for establishing the balance sheet at 31 December 2017 and 31 December 2016:

| | 31 December 2017 | 31 December 2016 |
| --- | --- | --- |
| Non-EU currencies | | |
| Botswana Pula (BWP) | 11,7512 | 11,2657 |
| Dominican Republic Pesos (DOP) | 57,1465 | 48,7476 |
| Fiji Dollars (FJD) | 2,4186 | 2,1969 |
| Haitian Gourde (HTG) | 75,69 | 68,78 |
| Kenya Shillings (KES) | 123,7 | 108,06 |
| Mauritania Ouguiyas (MRO) | 422,36 | 375,79 |
| Mauritius Rupees (MUR) | 40,07 | 37,85 |
| Mozambican Metical (MZN) | 70,09 | 75,25 |
| Rwanda Francs (RWF) | 1 003,37 | 856,80 |
| Tanzania Shillings (TZS) | 2 681,78 | 2 296,99 |
| Uganda Shillings (UGX) | 4 357,00 | 3 805,00 |
| United States Dollars (USD) | 1,1993 | 1,0541 |
| Franc CFA Francs (XAF/XOF) | 655,957 | 655,957 |
| South Africa Rand (ZAR) | 14,8054 | 14,457 |
| Zambia Kvacha (ZMW) | 11,965 | 10,4653 |

31 December 2017

31 December 2016

Non-EU currencies

Non-EU currencies

Botswana Pula (BWP)

11,7512

11,2657

Dominican Republic Pesos (DOP)

57,1465

48,7476

Fiji Dollars (FJD)

2,4186

2,1969

Haitian Gourde (HTG)

75,69

68,78

Kenya Shillings (KES)

123,7

108,06

Mauritania Ouguiyas (MRO)

422,36

375,79

Mauritius Rupees (MUR)

40,07

37,85

Mozambican Metical (MZN)

70,09

75,25

Rwanda Francs (RWF)

1 003,37

856,80

Tanzania Shillings (TZS)

2 681,78

2 296,99

Uganda Shillings (UGX)

4 357,00

3 805,00

United States Dollars (USD)

1,1993

1,0541

Franc CFA Francs (XAF/XOF)

655,957

655,957

South Africa Rand (ZAR)

14,8054

14,457

Zambia Kvacha (ZMW)

11,965

10,4653

3.4.3.   Equity price risk

Equity price risk

Equity price risk refers to the risk that the fair values of equity investments decrease as the result of changes in the levels of equity prices and/or the value of equity investments.

The IF is exposed to equity price risk via its investments in direct equity and venture capital funds.

The value of non-listed equity positions is not readily available for the purpose of monitoring and control on a continuous basis. For such positions, the best indications available include prices derived from any relevant valuation techniques.

The effects on the Facility’s contributors’ resources (as a result of a change in the fair value of the available-for-sale equity portfolio) due to a +/-10 % change in the value of individual direct equity and venture capital investments, with all other variables held constant, is EUR 49,8 million respectively EUR -49,8 million as at 31 December 2017 (EUR 51,7 million respectively EUR -51,7 million as at 31 December 2016).

4.   Fair values of financial instruments

Fair values of financial instruments

4.1.   Accounting classifications and fair values

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. These do not include fair value information for financial assets and financial liabilities not carried at fair value if the carrying amount is a reasonable approximation of fair value.

| At 31 December 2017 | Carrying amount | Fair value |
| --- | --- | --- |
| In EUR ’000 | Held for trading | Available-for-sale | Cash, loans and receivables | Held to maturity | Other financial liabilities | Total | Level 1 | Level 2 | Level 3 | Total |
| Financial assets carried at fair value: | | | | | | | | | | |
| Derivative financial instruments | 12 521 | — | — | — | — | 12 521 | — | 12 521 | — | 12 521 |
| Venture Capital Funds | — | 420 104 | — | — | — | 420 104 | — | — | 420 104 | 420 104 |
| Direct Equity Investments | — | 77 435 | — | — | — | 77 435 | 24 458 | — | 52 977 | 77 435 |
| Total | 12 521 | 497 539 | — | — | — | 510 060 | 24 458 | 12 521 | 473 081 | 510 060 |
| Financial assets not carried at fair value: | | | | | | | | | | |
| Cash and cash equivalents | — | — | 549 101 | — | — | 549 101 | — | — | — | — |
| Loans and receivables | — | — | 1 666 725 | — | — | 1 666 725 | — | 1 852 507 | — | 1 852 507 |
| Amounts receivable from contributors | — | — | 150 000 | — | — | 150 000 | — | — | — | — |
| Bonds | — | — | — | 144 382 | — | 144 382 | 144 382 | — | — | 144 382 |
| Other assets | — | — | 4 385 | — | — | 4 385 | — | — | — | — |
| Total | — | — | 2 370 211 | 144 382 | — | 2 514 593 | 144 382 | 1 852 507 | — | 1 996 889 |
| Total financial assets | 12 521 | 497 539 | 2 370 211 | 144 382 | — | 3 024 653 | | | | |
| Financial liabilities carried at fair value: | | | | | | | | | | |
| Derivative financial instruments | -1 153 | — | — | — | — | -1 153 | — | -1 153 | — | -1 153 |
| Total | -1 153 | — | — | — | — | -1 153 | — | -1 153 | — | -1 153 |
| Financial liabilities not carried at fair value: | | | | | | | | | | |
| Provisions for guarantees issued | — | — | — | — | - 484 | - 484 | | | | |
| Amounts owed to third parties | — | — | — | — | - 157 285 | - 157 285 | | | | |
| Other liabilities | — | — | — | — | -2 462 | -2 462 | | | | |
| Total | — | — | — | — | - 160 231 | - 160 231 | | | | |
| Total financial liabilities | -1 153 | — | — | — | - 160 231 | - 161 384 | | | | |

At 31 December 2017

Carrying amount

Fair value

In EUR ’000

In EUR ’000

Held for trading

Available-for-sale

Cash, loans and receivables

Held to maturity

Other financial liabilities

Total

Level 1

Level 2

Level 3

Total

Financial assets carried at fair value:

Financial assets carried at fair value:

Derivative financial instruments

12 521

—

—

—

—

12 521

—

12 521

—

12 521

Venture Capital Funds

—

420 104

—

—

—

420 104

—

—

420 104

420 104

Direct Equity Investments

—

77 435

—

—

—

77 435

24 458

—

52 977

77 435

Total

Total

12 521

12 521

497 539

497 539

—

—

—

510 060

510 060

24 458

24 458

12 521

12 521

473 081

473 081

510 060

510 060

Financial assets not carried at fair value:

Financial assets not carried at fair value:

Cash and cash equivalents

—

—

549 101

—

—

549 101

—

—

—

—

Loans and receivables

—

—

1 666 725

—

—

1 666 725

—

1 852 507

—

1 852 507

Amounts receivable from contributors

—

—

150 000

—

—

150 000

—

—

—

—

Bonds

—

—

—

144 382

—

144 382

144 382

—

—

144 382

Other assets

—

—

4 385

—

—

4 385

—

—

—

—

Total

Total

—

—

2 370 211

2 370 211

144 382

144 382

—

2 514 593

2 514 593

144 382

144 382

1 852 507

1 852 507

—

1 996 889

1 996 889

Total financial assets

Total financial assets

12 521

12 521

497 539

497 539

2 370 211

2 370 211

144 382

144 382

—

3 024 653

3 024 653

Financial liabilities carried at fair value:

Financial liabilities carried at fair value:

Derivative financial instruments

-1 153

—

—

—

—

-1 153

—

-1 153

—

-1 153

Total

Total

-1 153

-1 153

—

—

—

—

-1 153

-1 153

—

-1 153

-1 153

—

-1 153

-1 153

Financial liabilities not carried at fair value:

Financial liabilities not carried at fair value:

Provisions for guarantees issued

—

—

—

—

- 484

- 484

Amounts owed to third parties

—

—

—

—

- 157 285

- 157 285

Other liabilities

—

—

—

—

-2 462

-2 462

Total

Total

—

—

—

—

- 160 231

- 160 231

- 160 231

- 160 231

Total financial liabilities

Total financial liabilities

-1 153

-1 153

—

—

—

- 160 231

- 160 231

- 161 384

- 161 384

| At 31 December 2016 | Carrying amount | Fair value |
| --- | --- | --- |
| In EUR ’000 | Held for trading | Available-for-sale | Cash, loans and receivables | Held to maturity | Other financial liabilities | Total | Level 1 | Level 2 | Level 3 | Total |
| Financial assets carried at fair value: | | | | | | | | | | |
| Derivative financial instruments | 6 920 | — | — | — | — | 6 920 | — | 6 920 | — | 6 920 |
| Venture Capital Funds | — | 437 788 | — | — | — | 437 788 | — | — | 437 788 | 437 788 |
| Direct Equity Investments | — | 79 096 | — | — | — | 79 096 | 22 880 | — | 56 216 | 79 096 |
| Total | 6 920 | 516 884 | — | — | — | 523 804 | 22 880 | 6 920 | 494 004 | 523 804 |
| Financial assets not carried at fair value: | | | | | | | | | | |
| Cash and cash equivalents | — | — | 360 817 | — | — | 360 817 | | | | |
| Loans and receivables | — | — | 1 729 380 | — | — | 1 729 380 | — | 1 951 786 | — | 1 951 786 |
| Amounts receivable from contributors | — | — | 86 395 | — | — | 86 395 | — | — | — | — |
| Bonds | — | — | — | 169 398 | — | 169 398 | 120 123 | 48 031 | — | 168 154 |
| Other assets | — | — | 345 | — | — | 345 | — | — | — | — |
| Total | — | — | 2 176 937 | 169 398 | — | 2 346 335 | 120 123 | 1 999 817 | — | 2 119 940 |
| Total financial assets | 6 920 | 516 884 | 2 176 937 | 169 398 | — | 2 870 139 | | | | |
| Financial liabilities carried at fair value: | | | | | | | | | | |
| Derivative financial instruments | -25 189 | — | — | — | — | -25 189 | — | -25 189 | — | -25 189 |
| Total | -25 189 | — | — | — | — | -25 189 | — | -25 189 | — | -25 189 |
| Financial liabilities not carried at fair value: | | | | | | | | | | |
| Provisions for guarantees issued | — | — | — | — | - 625 | - 625 | | | | |
| Amounts owed to third parties | — | — | — | — | - 116 114 | - 116 114 | | | | |
| Other liabilities | — | — | — | — | -2 546 | -2 546 | | | | |
| Total | — | — | — | — | - 119 285 | - 119 285 | | | | |
| Total financial liabilities | -25 189 | — | — | — | - 119 285 | - 144 474 | | | | |

At 31 December 2016

Carrying amount

Fair value

In EUR ’000

In EUR ’000

Held for trading

Available-for-sale

Cash, loans and receivables

Held to maturity

Other financial liabilities

Total

Level 1

Level 2

Level 3

Total

Financial assets carried at fair value:

Financial assets carried at fair value:

Derivative financial instruments

6 920

—

—

—

—

6 920

—

6 920

—

6 920

Venture Capital Funds

—

437 788

—

—

—

437 788

—

—

437 788

437 788

Direct Equity Investments

—

79 096

—

—

—

79 096

22 880

—

56 216

79 096

Total

Total

6 920

6 920

516 884

516 884

—

—

—

523 804

523 804

22 880

22 880

6 920

6 920

494 004

494 004

523 804

523 804

Financial assets not carried at fair value:

Financial assets not carried at fair value:

Cash and cash equivalents

—

—

360 817

—

—

360 817

Loans and receivables

—

—

1 729 380

—

—

1 729 380

—

1 951 786

—

1 951 786

Amounts receivable from contributors

—

—

86 395

—

—

86 395

—

—

—

—

Bonds

—

—

—

169 398

—

169 398

120 123

48 031

—

168 154

Other assets

—

—

345

—

—

345

—

—

—

—

Total

Total

—

—

2 176 937

2 176 937

169 398

169 398

—

2 346 335

2 346 335

120 123

120 123

1 999 817

1 999 817

—

2 119 940

2 119 940

Total financial assets

Total financial assets

6 920

6 920

516 884

516 884

2 176 937

2 176 937

169 398

169 398

—

2 870 139

2 870 139

Financial liabilities carried at fair value:

Financial liabilities carried at fair value:

Derivative financial instruments

-25 189

—

—

—

—

-25 189

—

-25 189

—

-25 189

Total

Total

-25 189

-25 189

—

—

—

—

-25 189

-25 189

—

-25 189

-25 189

—

-25 189

-25 189

Financial liabilities not carried at fair value:

Financial liabilities not carried at fair value:

Provisions for guarantees issued

—

—

—

—

- 625

- 625

Amounts owed to third parties

—

—

—

—

- 116 114

- 116 114

Other liabilities

—

—

—

—

-2 546

-2 546

Total

Total

—

—

—

—

- 119 285

- 119 285

- 119 285

- 119 285

Total financial liabilities

Total financial liabilities

-25 189

-25 189

—

—

—

- 119 285

- 119 285

- 144 474

- 144 474

4.2.   Measurement of fair values

4.2.1.   Valuation techniques and significant unobservable inputs

Valuation techniques and significant unobservable inputs

The table below sets out information about the valuation techniques and significant unobservable inputs used in measuring financial instruments, categorised as level 2 and 3 in the fair value hierarchy:

| Valuation technique | Significant unobservable inputs | Relationship of unobservable inputs to fair value measurement |
| --- | --- | --- |
| Financial instruments carried at fair value | | |
| Derivative financial instruments | Discounted cash flow: Future cash flows are estimated based on forward exchange/interest rates (from observable forward exchange rates and yield curves at the end of the reporting period) and contract forward/interest rates, discounted at a rate that reflects the credit risk of various counterparties. | Not applicable. | Not applicable. |
| Venture Capital Fund (VCF) | Adjusted net assets method: The fair value is determined by applying either the Facility’s percentage ownership in the underlying vehicle to the net asset value reflected in the most recent report adjusted for cash flows or, where available, the precise share value at the same date, submitted by the respective Fund Manager. In order to bridge the interval between the last available Net assets value (NAV) and the year-end reporting, a subsequent event review procedure is performed and if necessary the reported NAV is adjusted. | Adjustment for time elapsed between the last reporting date of the VCF and the measurement date, taking into account: operating expenses and management fees, subsequent changes in the fair value of the VCF’s underlying assets, additional liabilities incurred, market changes or other economic condition changes. | The longer the period between the fair value measurement date and the last reporting date of the VCF, the higher the adjustment for time elapsed. |
| Direct Equity Investment | Adjusted net assets. | Adjustment for time elapsed between the last reporting date of the investee and the measurement date, taking into account: operating expenses, subsequent changes in the fair value of the investee’s underlying assets, additional liabilities incurred, market changes or other economic condition changes, capital increase, sale/change of control. | The longer the period between the fair value measurement date and the last reporting date of the investee, the higher the adjustment for time elapsed. |
| | | Discount for lack of marketability (liquidity) determined by reference to previous transaction prices for similar equities in the country/region, ranging from 5 to 30 %. | The higher the marketability discount, the lower the fair value. |
| Financial instruments not carried at fair value | | |
| Loans and receivables | Discounted cash flows: The valuation model uses contractual cash flows that are conditional upon the non-occurrence of default by the debtor and do not take into account any collateral values or early repayments’ scenarios. To obtain the Net Present Value (NPV) of the loans, the model retained discounts the contractual cash flows of each loan using an adjusted market discount curve. The individual loan NPV is then adjusted to take into consideration the relevant associated Expected Loss. The results are then summed to obtain the fair value of Loans and receivables. | Not applicable. | Not applicable. |
| Held-to-maturity financial assets | Discounted cash flows. | Not applicable. | Not applicable. |

Valuation technique

Valuation technique

Significant unobservable inputs

Significant unobservable inputs

Relationship of unobservable inputs to fair value measurement

Relationship of unobservable inputs to fair value measurement

Financial instruments carried at fair value

Financial instruments carried at fair value

Derivative financial instruments

Discounted cash flow: Future cash flows are estimated based on forward exchange/interest rates (from observable forward exchange rates and yield curves at the end of the reporting period) and contract forward/interest rates, discounted at a rate that reflects the credit risk of various counterparties.

Not applicable.

Not applicable.

Venture Capital Fund (VCF)

Adjusted net assets method: The fair value is determined by applying either the Facility’s percentage ownership in the underlying vehicle to the net asset value reflected in the most recent report adjusted for cash flows or, where available, the precise share value at the same date, submitted by the respective Fund Manager. In order to bridge the interval between the last available Net assets value (NAV) and the year-end reporting, a subsequent event review procedure is performed and if necessary the reported NAV is adjusted.

Adjustment for time elapsed between the last reporting date of the VCF and the measurement date, taking into account: operating expenses and management fees, subsequent changes in the fair value of the VCF’s underlying assets, additional liabilities incurred, market changes or other economic condition changes.

The longer the period between the fair value measurement date and the last reporting date of the VCF, the higher the adjustment for time elapsed.

Direct Equity Investment

Adjusted net assets.

Adjustment for time elapsed between the last reporting date of the investee and the measurement date, taking into account: operating expenses, subsequent changes in the fair value of the investee’s underlying assets, additional liabilities incurred, market changes or other economic condition changes, capital increase, sale/change of control.

The longer the period between the fair value measurement date and the last reporting date of the investee, the higher the adjustment for time elapsed.

Discount for lack of marketability (liquidity) determined by reference to previous transaction prices for similar equities in the country/region, ranging from 5 to 30 %.

The higher the marketability discount, the lower the fair value.

Financial instruments not carried at fair value

Financial instruments not carried at fair value

Loans and receivables

Discounted cash flows: The valuation model uses contractual cash flows that are conditional upon the non-occurrence of default by the debtor and do not take into account any collateral values or early repayments’ scenarios. To obtain the Net Present Value (NPV) of the loans, the model retained discounts the contractual cash flows of each loan using an adjusted market discount curve. The individual loan NPV is then adjusted to take into consideration the relevant associated Expected Loss. The results are then summed to obtain the fair value of Loans and receivables.

Not applicable.

Not applicable.

Held-to-maturity financial assets

Discounted cash flows.

Not applicable.

Not applicable.

With the application of IFRS 13, valuation adjustments are included in the fair value of derivatives at 31 December 2017 and 2016, namely:

| — | Credit valuation adjustments (CVA), reflecting counterparty credit risk on derivative transactions, amounting to EUR - 38k as at 31 December 2017 and to EUR -76,4k as at 31 December 2016. |
| --- | --- |

—

Credit valuation adjustments (CVA), reflecting counterparty credit risk on derivative transactions, amounting to EUR - 38k as at 31 December 2017 and to EUR -76,4k as at 31 December 2016.

| — | Debit valuation adjustments (DVA), reflecting own credit risk on derivative transactions, amounting to EUR +29,5k as at 31 December 2017 and EUR +42,9k as at 31 December 2016. |
| --- | --- |

—

Debit valuation adjustments (DVA), reflecting own credit risk on derivative transactions, amounting to EUR +29,5k as at 31 December 2017 and EUR +42,9k as at 31 December 2016.

4.2.2.   Transfers between Level 1 and 2

Transfers between Level 1 and 2

The Facility’s policy is to recognise the transfers between Levels as of the date of the event or change in circumstances that caused the transfer.

In 2017 and 2016 the Facility did not make transfers from Level 1 to 2 or Level 2 to 1 of the fair value hierarchy.

4.2.3.   Level 3 fair values

Level 3 fair values

Reconciliation of Level 3 fair values

Reconciliation of Level 3 fair values

The following tables present the changes in Level 3 instruments for the year ended 31 December 2017 and 31 December 2016:

| (In EUR ’000) |
| --- |
| Available-for-sale financial assets |
| Balance at 1 January 2017 | 494 004 |
| Gains or losses included in profit or loss: | |
| — | net realised gains on available-for-sale financial assets |

(In EUR ’000)

Available-for-sale financial assets

Balance at 1 January 2017

Balance at 1 January 2017

494 004

494 004

Gains or losses included in profit or loss:

Gains or losses included in profit or loss:

—

net realised gains on available-for-sale financial assets

2 711

| — | impairment on available-for-sale financial assets |
| --- | --- |

—

impairment on available-for-sale financial assets

-22 024

Total

Total

-19 313

-19 313

Gains or losses included in other comprehensive income:

Gains or losses included in other comprehensive income:

| — | net change in fair value of available-for-sale financial assets |
| --- | --- |

—

net change in fair value of available-for-sale financial assets

-17 592

Total

Total

-17 592

-17 592

Disbursements

62 660

Repayments

-44 568

Write offs

-2 110

Balance at 31 December 2017

Balance at 31 December 2017

473 081

473 081

| (In EUR ’000) |
| --- |
| Available-for-sale financial assets |
| Balance at 1 January 2016 | 419 175 |
| Gains or losses included in profit or loss: | |
| — | net realised gains on available-for-sale financial assets |

(In EUR ’000)

Available-for-sale financial assets

Balance at 1 January 2016

Balance at 1 January 2016

419 175

419 175

Gains or losses included in profit or loss:

Gains or losses included in profit or loss:

—

net realised gains on available-for-sale financial assets

-6 504

| — | impairment on available-for-sale financial assets |
| --- | --- |

—

impairment on available-for-sale financial assets

-2 493

Total

Total

-8 997

-8 997

Gains or losses included in other comprehensive income:

Gains or losses included in other comprehensive income:

| — | net change in fair value of available-for-sale financial assets |
| --- | --- |

—

net change in fair value of available-for-sale financial assets

-24 628

Total

Total

-24 628

-24 628

Disbursements

153 986

Repayments

-37 978

Write offs

-7 554

Balance at 31 December 2016

Balance at 31 December 2016

494 004

494 004

In 2017 and 2016 the Facility did not make transfers out or to Level 3 of the fair value hierarchy.

Sensitivity analysis

Sensitivity analysis

A +/- 10 percent change at the reporting date to one of the significant unobservable inputs used to measure the fair values of the Venture Capital Funds and Direct Equity Investments, holding other inputs constant, would have the following effects on the other comprehensive income:

| At 31 December 2017 | Increase | Decrease |
| --- | --- | --- |
| (in EUR '000) |
| Direct Equity Investments | — | — |

At 31 December 2017

Increase

Decrease

(in EUR '000)

(in EUR '000)

Direct Equity Investments

—

—

| At 31 December 2016 | Increase | Decrease |
| --- | --- | --- |
| (in EUR '000) |
| Direct Equity Investments | 10 | - 10 |
| Total | 10 | - 10 |

At 31 December 2016

Increase

Decrease

(in EUR '000)

(in EUR '000)

Direct Equity Investments

10

- 10

Total

Total

10

10

- 10

- 10

5.   Cash and cash equivalents (in EUR '000)

Cash and cash equivalents (in EUR '000)

The cash and cash equivalents are composed of:

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Cash in hand | 166 445 | 51 462 |
| Term deposits | 367 653 | 259 337 |
| Commercial papers | 15 003 | 50 018 |
| Cash and cash equivalents in the statement of financial position | 549 101 | 360 817 |
| Accrued interest | 68 | 5 |
| Cash and cash equivalents in the cash flow statement | 549 169 | 360 822 |

31.12.2017

31.12.2016

Cash in hand

166 445

51 462

Term deposits

367 653

259 337

Commercial papers

15 003

50 018

Cash and cash equivalents in the statement of financial position

Cash and cash equivalents in the statement of financial position

549 101

549 101

360 817

360 817

Accrued interest

68

5

Cash and cash equivalents in the cash flow statement

Cash and cash equivalents in the cash flow statement

549 169

549 169

360 822

360 822

6.   Derivative financial instruments (in EUR '000)

Derivative financial instruments (in EUR '000)

The main components of derivative financial instruments, classified as held for trading, are as follows:

| At 31 December 2017 | Fair Value | Notional amount |
| --- | --- | --- |
| Assets | Liabilities |
| Cross currency interest rate swaps | 149 | -1 105 | 8 098 |
| Interest rate swaps | 393 | - 48 | 31 711 |
| FX swaps | 11 979 | — | 1 500 000 |
| Total derivative financial instruments | 12 521 | -1 153 | 1 539 809 |

At 31 December 2017

Fair Value

Notional amount

Assets

Liabilities

Cross currency interest rate swaps

149

-1 105

8 098

Interest rate swaps

393

- 48

31 711

FX swaps

11 979

—

1 500 000

Total derivative financial instruments

Total derivative financial instruments

12 521

12 521

-1 153

-1 153

1 539 809

1 539 809

| At 31 December 2016 | Fair Value | Notional amount |
| --- | --- | --- |
| Assets | Liabilities |
| Cross currency interest rate swaps | — | -3 051 | 7 430 |
| Interest rate swaps | 388 | - 335 | 41 233 |
| FX swaps | 6 532 | -21 803 | 1 611 000 |
| Total derivative financial instruments | 6 920 | -25 189 | 1 659 663 |

At 31 December 2016

Fair Value

Notional amount

Assets

Liabilities

Cross currency interest rate swaps

—

-3 051

7 430

Interest rate swaps

388

- 335

41 233

FX swaps

6 532

-21 803

1 611 000

Total derivative financial instruments

Total derivative financial instruments

6 920

6 920

-25 189

-25 189

1 659 663

1 659 663

7.   Loans and receivables (in EUR '000)

Loans and receivables (in EUR '000)

The main components of loans and receivables are as follows:

| | Global loans (*4) | Senior loans | Subordinated loans | Total |
| --- | --- | --- | --- | --- |
| Nominal as at 1 January 2017 | 994 527 | 764 339 | 71 563 | 1 830 429 |
| Disbursements | 305 059 | 63 603 | — | 368 662 |
| Write offs | -3 257 | -6 138 | — | -9 395 |
| Repayments | - 162 361 | -91 125 | — | - 253 486 |
| Interest capitalised | — | — | — | — |
| Foreign exchange rates differences | - 128 874 | -43 180 | -9 017 | - 181 071 |
| Nominal as at 31 December 2017 | 1 005 094 | 687 499 | 62 546 | 1 755 139 |
| Impairment as at 1 January 2017 | -18 185 | -28 294 | -71 161 | - 117 640 |
| Impairment recorded in statement of profit or loss and other comprehensive income | -5 105 | -11 572 | — | -16 677 |
| Write offs | 3 257 | 6 138 | — | 9 395 |
| Reversal of impairment | 2 204 | 3 752 | — | 5 956 |
| Foreign exchange rates differences | 914 | 3 234 | 8 615 | 12 763 |
| Impairment as at 31 December 2017 | -16 915 | -26 742 | -62 546 | - 106 203 |
| Amortised Cost | -3 802 | -3 408 | — | -7 210 |
| Interest | 15 122 | 9 877 | — | 24 999 |
| Loans and receivables as at 31 December 2017 | 999 499 | 667 226 | — | 1 666 725 |

Global loans (*4)

*4

Senior loans

Subordinated loans

Total

Nominal as at 1 January 2017

Nominal as at 1 January 2017

994 527

994 527

764 339

764 339

71 563

71 563

1 830 429

1 830 429

Disbursements

305 059

63 603

—

368 662

Write offs

-3 257

-6 138

—

-9 395

Repayments

- 162 361

-91 125

—

- 253 486

Interest capitalised

—

—

—

—

Foreign exchange rates differences

- 128 874

-43 180

-9 017

- 181 071

Nominal as at 31 December 2017

Nominal as at 31 December 2017

1 005 094

1 005 094

687 499

687 499

62 546

62 546

1 755 139

1 755 139

Impairment as at 1 January 2017

Impairment as at 1 January 2017

-18 185

-18 185

-28 294

-28 294

-71 161

-71 161

- 117 640

- 117 640

Impairment recorded in statement of profit or loss and other comprehensive income

-5 105

-11 572

—

-16 677

Write offs

3 257

6 138

—

9 395

Reversal of impairment

2 204

3 752

—

5 956

Foreign exchange rates differences

914

3 234

8 615

12 763

Impairment as at 31 December 2017

Impairment as at 31 December 2017

-16 915

-16 915

-26 742

-26 742

-62 546

-62 546

- 106 203

- 106 203

Amortised Cost

-3 802

-3 408

—

-7 210

Interest

15 122

9 877

—

24 999

Loans and receivables as at 31 December 2017

Loans and receivables as at 31 December 2017

999 499

999 499

667 226

667 226

—

—

1 666 725

1 666 725

| | Global loans (*5) | Senior loans | Subordinated loans | Total |
| --- | --- | --- | --- | --- |
| Nominal as at 1 January 2016 | 661 792 | 818 007 | 160 555 | 1 640 354 |
| Disbursements | 476 685 | 51 691 | — | 528 376 |
| Write offs | — | - 109 | -31 189 | -31 298 |
| Repayments | - 178 282 | - 107 259 | -65 927 | - 351 468 |
| Interest capitalised | — | — | 7 183 | 7 183 |
| Foreign exchange rates differences | 34 332 | 2 009 | 941 | 37 282 |
| Nominal as at 31 December 2016 | 994 527 | 764 339 | 71 563 | 1 830 429 |
| Impairment as at 1 January 2016 | -9 403 | -22 445 | - 159 198 | - 191 046 |
| Impairment recorded in statement of profit or loss and other comprehensive income | -8 794 | -11 999 | — | -20 793 |
| Write offs | — | 109 | 31 189 | 31 298 |
| Reversal of impairment | 360 | 6 100 | 58 698 | 65 158 |
| Foreign exchange rates differences | - 348 | - 59 | -1 850 | -2 257 |
| Impairment as at 31 December 2016 | -18 185 | -28 294 | -71 161 | - 117 640 |
| Amortised Cost | -3 906 | -3 682 | — | -7 588 |
| Interest | 14 807 | 9 371 | 1 | 24 179 |
| Loans and receivables as at 31 December 2016 | 987 243 | 741 734 | 403 | 1 729 380 |

Global loans (*5)

*5

Senior loans

Subordinated loans

Total

Nominal as at 1 January 2016

Nominal as at 1 January 2016

661 792

661 792

818 007

818 007

160 555

160 555

1 640 354

1 640 354

Disbursements

476 685

51 691

—

528 376

Write offs

—

- 109

-31 189

-31 298

Repayments

- 178 282

- 107 259

-65 927

- 351 468

Interest capitalised

—

—

7 183

7 183

Foreign exchange rates differences

34 332

2 009

941

37 282

Nominal as at 31 December 2016

Nominal as at 31 December 2016

994 527

994 527

764 339

764 339

71 563

71 563

1 830 429

1 830 429

Impairment as at 1 January 2016

Impairment as at 1 January 2016

-9 403

-9 403

-22 445

-22 445

- 159 198

- 159 198

- 191 046

- 191 046

Impairment recorded in statement of profit or loss and other comprehensive income

-8 794

-11 999

—

-20 793

Write offs

—

109

31 189

31 298

Reversal of impairment

360

6 100

58 698

65 158

Foreign exchange rates differences

- 348

- 59

-1 850

-2 257

Impairment as at 31 December 2016

Impairment as at 31 December 2016

-18 185

-18 185

-28 294

-28 294

-71 161

-71 161

- 117 640

- 117 640

Amortised Cost

-3 906

-3 682

—

-7 588

Interest

14 807

9 371

1

24 179

Loans and receivables as at 31 December 2016

Loans and receivables as at 31 December 2016

987 243

987 243

741 734

741 734

403

403

1 729 380

1 729 380

8.   Available-for-sale financial assets (in EUR '000)

Available-for-sale financial assets (in EUR '000)

The main components of available-for-sale financial assets are as follows:

| | Venture Capital Funds | Direct Equity Investments | Total |
| --- | --- | --- | --- |
| Cost as at 1 January 2017 | 331 253 | 72 636 | 403 889 |
| Disbursements | 62 660 | — | 62 660 |
| Repayments/sales | -41 678 | -2 890 | -44 568 |
| Write offs | - 437 | -1 673 | -2 110 |
| Foreign exchange rates differences on repayments/sales | 1 600 | 55 | 1 655 |
| Cost as at 31 December 2017 | 353 398 | 68 128 | 421 526 |
| Unrealised gains and losses as at 1 January 2017 | 129 427 | 13 457 | 142 884 |
| Net change in unrealised gains and losses | -18 242 | 1 174 | -17 068 |
| Unrealised gains and losses as at 31 December 2017 | 111 185 | 14 631 | 125 816 |
| Impairment as at 1 January 2017 | -22 892 | -6 997 | -29 889 |
| Impairment recorded in statement of profit or loss and other comprehensive income during the year | -22 024 | — | -22 024 |
| Write offs | 437 | 1 673 | 2 110 |
| Impairment as at 31 December 2017 | -44 479 | -5 324 | -49 803 |
| Available-for-sale financial assets as at 31 December 2017 | 420 104 | 77 435 | 497 539 |

Venture Capital Funds

Direct Equity Investments

Total

Cost as at 1 January 2017

Cost as at 1 January 2017

331 253

331 253

72 636

72 636

403 889

403 889

Disbursements

62 660

—

62 660

Repayments/sales

-41 678

-2 890

-44 568

Write offs

- 437

-1 673

-2 110

Foreign exchange rates differences on repayments/sales

1 600

55

1 655

Cost as at 31 December 2017

Cost as at 31 December 2017

353 398

353 398

68 128

68 128

421 526

421 526

Unrealised gains and losses as at 1 January 2017

Unrealised gains and losses as at 1 January 2017

129 427

129 427

13 457

13 457

142 884

142 884

Net change in unrealised gains and losses

-18 242

1 174

-17 068

Unrealised gains and losses as at 31 December 2017

Unrealised gains and losses as at 31 December 2017

111 185

111 185

14 631

14 631

125 816

125 816

Impairment as at 1 January 2017

Impairment as at 1 January 2017

-22 892

-22 892

-6 997

-6 997

-29 889

-29 889

Impairment recorded in statement of profit or loss and other comprehensive income during the year

-22 024

—

-22 024

Write offs

437

1 673

2 110

Impairment as at 31 December 2017

Impairment as at 31 December 2017

-44 479

-44 479

-5 324

-5 324

-49 803

-49 803

Available-for-sale financial assets as at 31 December 2017

Available-for-sale financial assets as at 31 December 2017

420 104

420 104

77 435

77 435

497 539

497 539

| | Venture Capital Funds | Direct Equity Investments | Total |
| --- | --- | --- | --- |
| Cost as at 1 January 2016 | 267 331 | 22 979 | 290 310 |
| Disbursements | 101 323 | 52 663 | 153 986 |
| Repayments/sales | -37 948 | - 30 | -37 978 |
| Write offs | -4 594 | -2 960 | -7 554 |
| Foreign exchange rates differences on repayments/sales | 5 141 | - 16 | 5 125 |
| Cost as at 31 December 2016 | 331 253 | 72 636 | 403 889 |
| Unrealised gains and losses as at 1 January 2016 | 153 901 | 10 092 | 163 993 |
| Net change in unrealised gains and losses | -24 474 | 3 365 | -21 109 |
| Unrealised gains and losses as at 31 December 2016 | 129 427 | 13 457 | 142 884 |
| Impairment as at 1 January 2016 | -25 029 | -9 921 | -34 950 |
| Impairment recorded in statement of profit or loss and other comprehensive income during the year | -2 457 | - 36 | -2 493 |
| Write offs | 4 594 | 2 960 | 7 554 |
| Impairment as at 31 December 2016 | -22 892 | -6 997 | -29 889 |
| Available-for-sale financial assets as at 31 December 2016 | 437 788 | 79 096 | 516 884 |

Venture Capital Funds

Direct Equity Investments

Total

Cost as at 1 January 2016

Cost as at 1 January 2016

267 331

267 331

22 979

22 979

290 310

290 310

Disbursements

101 323

52 663

153 986

Repayments/sales

-37 948

- 30

-37 978

Write offs

-4 594

-2 960

-7 554

Foreign exchange rates differences on repayments/sales

5 141

- 16

5 125

Cost as at 31 December 2016

Cost as at 31 December 2016

331 253

331 253

72 636

72 636

403 889

403 889

Unrealised gains and losses as at 1 January 2016

Unrealised gains and losses as at 1 January 2016

153 901

153 901

10 092

10 092

163 993

163 993

Net change in unrealised gains and losses

-24 474

3 365

-21 109

Unrealised gains and losses as at 31 December 2016

Unrealised gains and losses as at 31 December 2016

129 427

129 427

13 457

13 457

142 884

142 884

Impairment as at 1 January 2016

Impairment as at 1 January 2016

-25 029

-25 029

-9 921

-9 921

-34 950

-34 950

Impairment recorded in statement of profit or loss and other comprehensive income during the year

-2 457

- 36

-2 493

Write offs

4 594

2 960

7 554

Impairment as at 31 December 2016

Impairment as at 31 December 2016

-22 892

-22 892

-6 997

-6 997

-29 889

-29 889

Available-for-sale financial assets as at 31 December 2016

Available-for-sale financial assets as at 31 December 2016

437 788

437 788

79 096

79 096

516 884

516 884

9.   Amounts receivable from contributors (in EUR '000)

Amounts receivable from contributors (in EUR '000)

The amounts receivable from contributors are entirely composed of Member States contribution called but not paid.

10.   Held-to-maturity financial assets (in EUR '000)

Held-to-maturity financial assets (in EUR '000)

The held-to-maturity portfolio is composed of quoted bonds which have a remaining maturity of less than three months at reporting date. The following table shows the movements of the held-to-maturity portfolio:

| Balance as at 1 January 2017 | 169 398 |
| --- | --- |
| Acquisitions | 1 084 149 |
| Maturities | -1 109 563 |
| Change in amortisation of premium/discount | - 59 |
| Change in accrued interest | 457 |
| Balance as at 31 December 2017 | 144 382 |

Balance as at 1 January 2017

Balance as at 1 January 2017

169 398

169 398

Acquisitions

1 084 149

Maturities

-1 109 563

Change in amortisation of premium/discount

- 59

Change in accrued interest

457

Balance as at 31 December 2017

Balance as at 31 December 2017

144 382

144 382

| Balance as at 1 January 2016 | 228 521 |
| --- | --- |
| Acquisitions | 1 159 704 |
| Maturities | -1 219 953 |
| Change in amortisation of premium/discount | - 87 |
| Change in accrued interest | 1 213 |
| Balance as at 31 December 2016 | 169 398 |

Balance as at 1 January 2016

Balance as at 1 January 2016

228 521

228 521

Acquisitions

1 159 704

Maturities

-1 219 953

Change in amortisation of premium/discount

- 87

Change in accrued interest

1 213

Balance as at 31 December 2016

Balance as at 31 December 2016

169 398

169 398

11.   Other assets (in EUR '000)

Other assets (in EUR '000)

The main components of other assets are as follows:

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Amount receivable from EIB | 4 117 | 1 |
| Financial guarantees | 268 | 344 |
| Total other assets | 4 385 | 345 |

31.12.2017

31.12.2016

Amount receivable from EIB

4 117

1

Financial guarantees

268

344

Total other assets

Total other assets

4 385

4 385

345

345

12.   Deferred income (in EUR '000)

Deferred income (in EUR '000)

The main components of deferred income are as follows:

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Deferred interest subsidies | 24 895 | 25 884 |
| Deferred commissions on loans and receivables | 907 | 399 |
| Total deferred income | 25 802 | 26 283 |

31.12.2017

31.12.2016

Deferred interest subsidies

24 895

25 884

Deferred commissions on loans and receivables

907

399

Total deferred income

Total deferred income

25 802

25 802

26 283

26 283

13.   Provisions for guarantees issued (in EUR '000)

Provisions for guarantees issued (in EUR '000)

The amount of provisions for guarantees issued is recognised using the best estimate of expenditure required to settle any present financial obligation arising as a result of the guarantees and represents the sum of:

| — | the amounts initially recognised less, where appropriate, cumulative amortisation recognised in accordance with IAS 18 Revenue and |
| --- | --- |

—

the amounts initially recognised less, where appropriate, cumulative amortisation recognised in accordance with IAS 18 Revenue and

| — | the excess over the above amounts, as measured in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets. |
| --- | --- |

—

the excess over the above amounts, as measured in accordance with IAS 37 Provisions, Contingent Liabilities and Contingent Assets.

| | 2017 | 2016 |
| --- | --- | --- |
| Balance at 1 January | 625 | — |
| Additions recorded in statement of profit or loss and other comprehensive income | 65 | 242 |
| Utilised | - 206 | — |
| Transfer from ‘Other liabilities’, financial guarantees | — | 383 |
| Balance at 31 December | 484 | 625 |

2017

2016

Balance at 1 January

625

—

Additions recorded in statement of profit or loss and other comprehensive income

65

242

Utilised

- 206

—

Transfer from ‘Other liabilities’, financial guarantees

—

383

Balance at 31 December

Balance at 31 December

484

484

625

625

14.   Amounts owed to third parties (in EUR '000)

Amounts owed to third parties (in EUR '000)

The main components of amounts owed to third parties are as follows:

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Net general administrative expenses payable to EIB | 45 105 | 43 483 |
| Other amounts payable to EIB | 580 | — |
| Interest subsidies and TA not yet disbursed owed to Member States | 111 600 | 72 631 |
| Total amounts owed to third parties | 157 285 | 116 114 |

31.12.2017

31.12.2016

Net general administrative expenses payable to EIB

45 105

43 483

Other amounts payable to EIB

580

—

Interest subsidies and TA not yet disbursed owed to Member States

111 600

72 631

Total amounts owed to third parties

Total amounts owed to third parties

157 285

157 285

116 114

116 114

15.   Other liabilities (in EUR '000)

Other liabilities (in EUR '000)

The main components of other liabilities are as follows:

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Loan repayments received in advance | 1 986 | 2 081 |
| Deferred income from interest subsidies | 436 | 458 |
| Financial guarantees | 40 | 7 |
| Total other liabilities | 2 462 | 2 546 |

31.12.2017

31.12.2016

Loan repayments received in advance

1 986

2 081

Deferred income from interest subsidies

436

458

Financial guarantees

40

7

Total other liabilities

Total other liabilities

2 462

2 462

2 546

2 546

16.   Member States Contribution called (in EUR '000)

Member States Contribution called (in EUR '000)

| Member States | Contribution to the Facility | Contribution to interest subsidies and technical assistance | Total contributed | Called and not paid (*6) |
| --- | --- | --- | --- | --- |
| Austria | 65 597 | 8 387 | 73 984 | 3 615 |
| Belgium | 96 872 | 12 340 | 109 212 | 5 295 |
| Bulgaria | 644 | 266 | 910 | 210 |
| Cyprus | 414 | 171 | 585 | 135 |
| Czech Republic | 2 346 | 969 | 3 315 | 765 |
| Denmark | 53 220 | 6 875 | 60 095 | 3 000 |
| Estonia | 230 | 95 | 325 | 75 |
| Finland | 37 206 | 4 920 | 42 126 | 2 205 |
| France | 589 781 | 72 062 | 661 843 | 29 325 |
| Germany | 574 815 | 72 516 | 647 331 | 30 750 |
| Greece | 32 475 | 4 589 | 37 064 | 2 205 |
| Hungary | 2 530 | 1 045 | 3 575 | 825 |
| Ireland | 16 939 | 2 620 | 19 559 | 1 365 |
| Italy | 317 104 | 42 453 | 359 557 | 19 290 |
| Latvia | 322 | 133 | 455 | 105 |
| Lithuania | 552 | 228 | 780 | 180 |
| Luxembourg | 7 207 | 930 | 8 137 | 405 |
| Malta | 138 | 57 | 195 | 45 |
| Netherlands | 129 685 | 16 715 | 146 400 | 7 275 |
| Poland | 5 980 | 2 470 | 8 450 | 1 950 |
| Portugal | 25 243 | 3 579 | 28 822 | 1 725 |
| Romania | 1 702 | 703 | 2 405 | 555 |
| Slovakia | 966 | 399 | 1 365 | 315 |
| Slovenia | 828 | 342 | 1 170 | 270 |
| Spain | 156 239 | 23 306 | 179 545 | 11 775 |
| Sweden | 68 760 | 9 129 | 77 889 | 4 110 |
| United Kingdom | 329 205 | 46 392 | 375 597 | 22 230 |
| Total as at 31 December 2017 | 2 517 000 | 333 691 | 2 850 691 | 150 000 |
| Total as at 31 December 2016 | 2 377 000 | 273 691 | 2 650 691 | 86 395 |

Member States

Contribution to the Facility

Contribution to interest subsidies and technical assistance

Total contributed

Called and not paid (*6)

*6

Austria

65 597

8 387

73 984

3 615

Belgium

96 872

12 340

109 212

5 295

Bulgaria

644

266

910

210

Cyprus

414

171

585

135

Czech Republic

2 346

969

3 315

765

Denmark

53 220

6 875

60 095

3 000

Estonia

230

95

325

75

Finland

37 206

4 920

42 126

2 205

France

589 781

72 062

661 843

29 325

Germany

574 815

72 516

647 331

30 750

Greece

32 475

4 589

37 064

2 205

Hungary

2 530

1 045

3 575

825

Ireland

16 939

2 620

19 559

1 365

Italy

317 104

42 453

359 557

19 290

Latvia

322

133

455

105

Lithuania

552

228

780

180

Luxembourg

7 207

930

8 137

405

Malta

138

57

195

45

Netherlands

129 685

16 715

146 400

7 275

Poland

5 980

2 470

8 450

1 950

Portugal

25 243

3 579

28 822

1 725

Romania

1 702

703

2 405

555

Slovakia

966

399

1 365

315

Slovenia

828

342

1 170

270

Spain

156 239

23 306

179 545

11 775

Sweden

68 760

9 129

77 889

4 110

United Kingdom

329 205

46 392

375 597

22 230

Total as at 31 December 2017

Total as at 31 December 2017

2 517 000

2 517 000

333 691

333 691

2 850 691

2 850 691

150 000

150 000

Total as at 31 December 2016

Total as at 31 December 2016

2 377 000

2 377 000

273 691

273 691

2 650 691

2 650 691

86 395

86 395

17.   Contingent liabilities and commitments (in EUR '000)

Contingent liabilities and commitments (in EUR '000)

| | 31.12.2017 | 31.12.2016 |
| --- | --- | --- |
| Commitments | | |
| Un-disbursed loans | 869 983 | 901 899 |
| Un-disbursed commitment in respect of available-for-sale financial assets | 321 695 | 244 050 |
| Issued guarantees | 7 682 | 8 627 |
| Interest subsidies and technical assistance | 382 576 | 334 553 |
| Contingent liabilities | | |
| Signed non-issued guarantees | 74 569 | 35 337 |
| Total contingent liabilities and commitments | 1 656 505 | 1 524 466 |

31.12.2017

31.12.2016

Commitments

Commitments

Un-disbursed loans

869 983

901 899

Un-disbursed commitment in respect of available-for-sale financial assets

321 695

244 050

Issued guarantees

7 682

8 627

Interest subsidies and technical assistance

382 576

334 553

Contingent liabilities

Contingent liabilities

Signed non-issued guarantees

74 569

35 337

Total contingent liabilities and commitments

Total contingent liabilities and commitments

1 656 505

1 656 505

1 524 466

1 524 466

18.   Interest and similar income and expenses (in EUR '000)

Interest and similar income and expenses (in EUR '000)

The main components of interest and similar income are as follows:

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Loans and receivables | 97 440 | 102 580 |
| Interest subsidies | 3 966 | 4 118 |
| Total interest and similar income | 101 406 | 106 698 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Loans and receivables

97 440

102 580

Interest subsidies

3 966

4 118

Total interest and similar income

Total interest and similar income

101 406

101 406

106 698

106 698

The main component of interest and similar expenses is as follows:

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Derivative financial instruments | - 980 | -1 142 |
| Cash and cash equivalents | -1 037 | - 752 |
| Held-to-maturity financial assets | - 654 | - 413 |
| Total interest and similar expenses | -2 671 | -2 307 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Derivative financial instruments

- 980

-1 142

Cash and cash equivalents

-1 037

- 752

Held-to-maturity financial assets

- 654

- 413

Total interest and similar expenses

Total interest and similar expenses

-2 671

-2 671

-2 307

-2 307

19.   Fee and commission income and expenses (in EUR '000)

Fee and commission income and expenses (in EUR '000)

The main components of fee and commission income are as follows:

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Fee and commission on loans and receivables | — | 515 |
| Fee and commission on financial guarantees | 209 | 183 |
| Other | 1 | 1 |
| Total fee and commission income | 210 | 699 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Fee and commission on loans and receivables

—

515

Fee and commission on financial guarantees

209

183

Other

1

1

Total fee and commission income

Total fee and commission income

210

210

699

699

The main component of fee and commission expenses is as follows:

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Commission paid to third parties with regard to available-for-sale financial assets | - 60 | - 48 |
| Total fee and commission expenses | - 60 | - 48 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Commission paid to third parties with regard to available-for-sale financial assets

- 60

- 48

Total fee and commission expenses

Total fee and commission expenses

- 60

- 60

- 48

- 48

20.   Net realised gains on available-for-sale financial assets (in EUR '000)

Net realised gains on available-for-sale financial assets (in EUR '000)

The main components of net realised gains on available-for-sale financial assets are as follows:

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Net proceeds from available-for-sale financial assets | 1 030 | 2 159 |
| Dividend income | 1 681 | 4 345 |
| Net realised gains on available-for-sale financial assets | 2 711 | 6 504 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Net proceeds from available-for-sale financial assets

1 030

2 159

Dividend income

1 681

4 345

Net realised gains on available-for-sale financial assets

Net realised gains on available-for-sale financial assets

2 711

2 711

6 504

6 504

21.   General administrative expenses (in EUR '000)

General administrative expenses (in EUR '000)

General administrative expenses represent the actual costs incurred by the EIB for managing the Facility less income generated from standard appraisal fees directly charged by the EIB to clients of the Facility.

| | From 1.1.2017 | From 1.1.2016 |
| --- | --- | --- |
| | to 31.12.2017 | to 31.12.2016 |
| Actual cost incurred by the EIB | -48 285 | -45 858 |
| Income from appraisal fees directly charged to clients of the Facility | 3 180 | 2 375 |
| Total general administrative expenses | -45 105 | -43 483 |

From 1.1.2017

From 1.1.2016

to 31.12.2017

to 31.12.2016

Actual cost incurred by the EIB

-48 285

-45 858

Income from appraisal fees directly charged to clients of the Facility

3 180

2 375

Total general administrative expenses

Total general administrative expenses

-45 105

-45 105

-43 483

-43 483

22.   Involvement with unconsolidated structured entities (in EUR '000)

Involvement with unconsolidated structured entities (in EUR '000)

Definition of a structured entity

Definition of a structured entity

A structured entity is one that has been designed so that voting or similar rights are not the dominant factor in deciding, who controls the-entity. IFRS 12 observes that a structured entity often has some or all of the following features:

| — | Restricted activities; |
| --- | --- |

—

Restricted activities;

| — | A narrow and well-defined objective, such as to effect a tax-efficient lease, carry out research and development activities, provide a source of capital or funding to an entity or provide investment opportunities for investors by passing on risks and rewards associated with the assets of the structured entity to investors; |
| --- | --- |

—

A narrow and well-defined objective, such as to effect a tax-efficient lease, carry out research and development activities, provide a source of capital or funding to an entity or provide investment opportunities for investors by passing on risks and rewards associated with the assets of the structured entity to investors;

| — | Insufficient equity to permit the structured entity to finance its activities without subordinated financial support; |
| --- | --- |

—

Insufficient equity to permit the structured entity to finance its activities without subordinated financial support;

| — | Financing in the form of multiple contractually linked instruments to investors that create concentrations of credit or other risks (tranches). |
| --- | --- |

—

Financing in the form of multiple contractually linked instruments to investors that create concentrations of credit or other risks (tranches).

Unconsolidated structured entities

Unconsolidated structured entities

The term ‘unconsolidated structured entities’ refers to all structured entities that are not controlled by the Facility and includes interests in structured entities that are not consolidated.

Definition of Interests in structured entities:

Definition of Interests in structured entities:

IFRS 12 defines ‘interests’ broadly to include any contractual or non-contractual involvement that exposes the reporting entity to variability in returns from the performance of the entity. Examples of such interests include the holding of equity interests and other forms of involvement such as the provision of funding, liquidity support, credit enhancements, commitments and guarantees to the other entity. IFRS 12 states that a reporting entity does not necessarily have an interest in another entity solely because of a typical customer supplier relationship.

The table below describes the types of structured entities that the Facility does not consolidate but in which it holds an interest.

| Type of structured entity | Nature and purpose | Interest held by the Facility |
| --- | --- | --- |
| Project Finance — lending to Special Purposes Vehicles (‘SPV’) | Project Finance Transactions (PF Operations) are transactions where the Facility relies for the servicing of its debt on a borrower whose sole or main source of revenue is generated by a single or limited number of assets being financed by such debt or other pre-existing assets contractually linked to the project. PF operations are often financed through SPV. | Net disbursed amounts;
  Interest income. |
| Venture capital operations | The Facility finances venture capital and investment funds. Venture capital and investment funds pool and manage money from investors seeking private equity stakes in small and medium-size enterprises with strong growth potential as well as financing infrastructure projects. | Investments in units/shares issued by the venture capital entity;
  Dividends received as dividend income. |

Type of structured entity

Nature and purpose

Interest held by the Facility

Project Finance — lending to Special Purposes Vehicles (‘SPV’)

Project Finance Transactions (PF Operations) are transactions where the Facility relies for the servicing of its debt on a borrower whose sole or main source of revenue is generated by a single or limited number of assets being financed by such debt or other pre-existing assets contractually linked to the project. PF operations are often financed through SPV.

Net disbursed amounts;

Interest income.

Venture capital operations

The Facility finances venture capital and investment funds. Venture capital and investment funds pool and manage money from investors seeking private equity stakes in small and medium-size enterprises with strong growth potential as well as financing infrastructure projects.

Investments in units/shares issued by the venture capital entity;

Dividends received as dividend income.

The table below shows the carrying amounts of unconsolidated structured entities in which the Facility has an interest at the reporting date, as well as the Facility’s maximum exposure to loss in relation to those entities. The maximum exposure to loss includes the carrying amounts and the related un-disbursed commitments.

| Type of structured entity | Caption | Carrying amount at 31.12.2017 | Carrying amount at 31.12.2016 | Maximum exposure to loss at 31.12.2017 | Maximum exposure to loss at 31.12.2016 |
| --- | --- | --- | --- | --- | --- |
| Venture capital funds | Available-for-sale financial assets | 420 104 | 437 788 | 737 661 | 672 222 |
| Total | | 420 104 | 437 788 | 737 661 | 672 222 |

Type of structured entity

Caption

Carrying amount at 31.12.2017

Carrying amount at 31.12.2016

Maximum exposure to loss at 31.12.2017

Maximum exposure to loss at 31.12.2016

Venture capital funds

Available-for-sale financial assets

420 104

437 788

737 661

672 222

Total

Total

420 104

420 104

437 788

437 788

737 661

737 661

672 222

672 222

23.   Impact financing envelope (in EUR '000)

Impact financing envelope (in EUR '000)

In June 2013 the ACP-EU Joint Ministerial Council approved the new financial protocol for the 11th European Development Fund (EDF), covering the period 2014-2020.

th

A new EUR 500m endowment was agreed for the Investment Facility, the so called ‘impact financing envelope’ or ‘IFE’, enabling the Facility to support projects that promise a particularly high development impact whilst bearing the greater risks inherent in such investments. This envelope will present new possibilities for enhancing the Facility’s private sector lending through investments in the following instruments:

Social impact equity funds — promoted by an emerging population of private equity fund managers who put the alleviation of social or environmental issues at the core of their funds’ investment strategy but still target sustainability at the levels of both the fund and its investee companies.

Social impact equity funds — p

Loans to financial intermediaries — (e.g. microfinance institutions, local banks and credit unions) operating in ACP countries in which the EIB cannot consider financing — in particular in local currency — under the existing credit risk guidelines, e.g. due to either high country risks, currency volatility or lack of pricing benchmarks. The main objective of such loans will be to fund projects with a high developmental impact, especially in the field of support to micro and small enterprises (MSEs) and agriculture, which generally do not qualify for IF financing.

Loans to financial intermediaries

Risk sharing facilitating instruments — which will take the form of first loss guarantees (‘first loss pieces’) that will facilitate risk sharing operations of the EIB with local financial intermediaries (mainly commercial banks) for the benefit of underserved SMEs and small projects that meet the Impact Financing Criteria in situations where a market gap has been identified in relation to the access of SMEs/small projects to finance. The first loss pieces would be structured as a counter-guarantee in favour of senior guarantee tranches funded by the EIB — under the Investment Facility — and by other International Financial Institutions/Development Financial Institutions, thus generating a substantial leverage effect.

Risk sharing facilitating instruments — w

Direct financing — through debt or equity instruments in projects with sound and experienced promoters and high developmental impacts, but that will, however, also entail higher expectations of losses and difficulties to recover the investment (equity type risk with higher than usual expectation of losses). The EIB will apply strict selection and eligibility criteria for this instrument, as these projects, notwithstanding their high developmental impact, would not be able to meet acceptable financing criteria (i.e. low expectation of recovering the investment or offsetting the losses through interest rates/equity returns).

Direct financing — t

The IFE will also allow diversification into new sectors, such as health and education, agriculture and food security, and the development of new and innovative risk-sharing instruments.

From a financial and accounting perspective the IFE forms part of the IF portfolio and is accounted for in the overall IF annual financial statements.

The following table represents the carrying amounts and the committed, but undisbursed amounts, per type of asset:

| Type of IFE investment | Caption | Carrying amount at 31.12.2017 | Carrying amount at 31.12.2016 | Undisbursed amount at 31.12.2017 | Undisbursed amount at 31.12.2016 |
| --- | --- | --- | --- | --- | --- |
| Social impact equity funds | Available-for-sale financial assets | 7 839 | 5 021 | 51 720 | 19 567 |
| Loans to financial intermediaries | Loans and receivables | 30 804 | 23 702 | 44 017 | 46 958 |
| Risk sharing facilitating instruments | Issued guarantees | 296 | - 288 | 64 569 | 33 719 |
| Direct financing — equity participations | Available-for-sale financial assets | 42 981 | 39 986 | 4 014 | 14 |
| Total | | 81 920 | 68 421 | 164 320 | 100 258 |

Type of IFE investment

Caption

Carrying amount at 31.12.2017

Carrying amount at 31.12.2016

Undisbursed amount at 31.12.2017

Undisbursed amount at 31.12.2016

Social impact equity funds

Available-for-sale financial assets

7 839

5 021

51 720

19 567

Loans to financial intermediaries

Loans and receivables

30 804

23 702

44 017

46 958

Risk sharing facilitating instruments

Issued guarantees

296

- 288

64 569

33 719

Direct financing — equity participations

Available-for-sale financial assets

42 981

39 986

4 014

14

Total

Total

81 920

81 920

68 421

68 421

164 320

164 320

100 258

100 258

24.   Subsequent events

Subsequent events

There have been no material post balance sheet events which could require disclosure or adjustment to the 31 December 2017 financial statements.

---

(1)  OJ L 210, 6.8.2013, p. 1.

1

(2)  The creation of the Bridging Facility had been first proposed as an article of the 11th EDF Implementation Regulation (COM(2013) 445). The Commission however has proposed, as an alternative, the creation of the Bridging Facility by a specific Council decision (Proposal for a Council decision regarding transitional EDF management measures from 1 January 2014 until the entry into force of the 11th EDF European Development Fund, COM(2013) 663).

2

(3)  Council Regulation (EC) No 215/2008 of 18 February 2008 on the Financial Regulation applicable to the 10th EDF. OJ L 78, 19.2.2008, p. 1.

3

(4)  Council Regulation (EU) No 567/2014 of 26 May 2014 amending Regulation (EC) No 215/2008 on the Financial Regulation applicable to the 10th EDF as regards the application of the transition period between the 10th EDF and the 11th EDF until the entry into force of the 11th EDF Internal Agreement. OJ L 157, 27.5.2014, p. 52.

4

(5)  Council Regulation (EU) 2015/323 of 2 March 2015 on the financial regulation applicable to the 11th European Development Fund. OJ L 58, 3.3.2015, p. 17.

5

(6)  Council Regulation (EU) 2015/322 of 2 March 2015 on the implementation of the 11th European Development Fund. OJ L 58, 3.3.2015, p. 1.

6

(7)  Council Regulation (EU) No 567/2014 of 26 May 2014 amending Regulation (EC) No 215/2008 on the Financial Regulation applicable to the 10th EDF as regards the application of the transition period between the 10th EDF and the 11th EDF until the entry into force of the 11th EDF Internal Agreement. OJ L 157, 27.5.2014, Art. 43.

7

(1)  It should be noted that due to the rounding of figures into millions of euros, some financial data in the tables below may appear not to add up.

1

(8)  It should be noted that due to the rounding of figures into millions of euros, some financial data in the tables may appear not to add up.

8

(*1)  From total assets, liabilities and net assets, liaison accounts should be deducted in order to reconcile them to the totals in the EDF Balance sheet

*1

(9)  It should be noted that due to the rounding of figures into millions of euros, some financial data in the tables may appear not to add up.

9

(10)  In accordance with Article 59 of the Financial Regulation applicable to the 11th European Development Fund, the treasury is presented in the balance sheet of the 11th EDF.

10

(11)  In accordance with Article 59 of the Financial Regulation applicable to the 11th European Development Fund, the treasury is presented in the balance sheet of the 11th EDF. The nature of the various bank accounts is outlined in Chapter 5, Financial Risk Management.

11

(12)  OJ L 173, 6.7.2017, p. 15.

12

(13)  It should be noted that due to the rounding of figures into thousands of euros, some financial data in the tables may appear not to add up.

13

(14)  It should be noted that due to the rounding of figures into thousands of euros, some financial data in the tables may appear not to add up.

14

(15)  It should be noted that due to the rounding of figures into millions of euros, some financial data in the tables may appear not to add up.

15

(2)  All decreases are decommitments transferred to the non-mobilisable performance reserve of the 10th EDF

2

(3)  All decreases are decommitments transferred to the non-mobilisable performance reserve of the 10th EDF

3

(4)  Following Council Decision 2010/406/EU, 150 million was added from non-mobilisable performance reserve 10th EDF for Sudan (147 million to special allocation Sudan and 3 million to implementation costs)

4

(5)  Following Council Decision 2011/315/EU, 200 million was added from non-mobilisable performance reserve 10th EDF for Sudan (194 million to special allocation South Sudan and 6 million to implementation costs)

5

(6)  Transfer in decommitments from projects of the 9th and previous EDF’s to the non mobilisable performance reserve for 377 million less transfer out of reserves to South Sudan for 200 million (to 9th EDF). Year to date the total of the non-mobilisable reserve ACP created was 807 million, of which 350 million has been used (150 million for Sudan, 200 million for South Soudan, both transfered to 9th EDF).

6

(7)  Transfers in/from the 10th EDF reserves

7

(8)  For the co-financing, the table only presents the commitment appropriations

8

(16)  Council Decision No 2013/759/EU (3) established transitional European Development Fund (EDF) management measures (‘Bridging Facility’) to ensure the availability of funds for cooperation with African, Caribbean and Pacific (ACP) States and with Overseas Countries and Territories (OCTs), as well as for support expenditure, from 1 January 2014 until the entry into force of the 11th EDF Internal Agreement

16

(9)  % of appropriations

9

(17)  Decreases are explained by repayments of capital occurred during the year on operations already considered as forborne as of 31 December 2017 and by termination of forborn measures during the year.

17

(*2)  See section 3.4.2.2.2 for explanations on synthetic hedge.

*2

(*3)  See section 3.4.2.2.2 for explanations on synthetic hedge.

*3

(*4)  including agency agreements

*4

(*5)  including agency agreements

*5

(*6)  On 26 October 2017, the Council fixed the amount of financial contributions to be paid by each Member State by. As at 31 December 2017 EUR 150 000 000 were not paid in.

*6

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