# EDGAR Filing Document

**Accession Number:** 0000785677
**File Stem:** 0001208646-25-000028
**Filing Date:** 2025-7
**Character Count:** 517185
**Document Hash:** 4a3d0899ec0d7bd3dedecd5701b96a49
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001208646-25-000028.hdr.sgml**: 20250711

**ACCESSION NUMBER**: 0001208646-25-000028

**CONFORMED SUBMISSION TYPE**: ANNLRPT

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20241231

**FILED AS OF DATE**: 20250711

**DATE AS OF CHANGE**: 20250711

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** AFRICAN DEVELOPMENT BANK
- **CENTRAL INDEX KEY:** 0000785677
- **STANDARD INDUSTRIAL CLASSIFICATION:** UNKNOWN SIC - 8880 [8880]
- **ORGANIZATION NAME:** International Corp Fin
- **EIN:** 000000000

**FILING VALUES:**
- **FORM TYPE:** ANNLRPT
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 083-00004
- **FILM NUMBER:** 251117512

**BUSINESS ADDRESS:**
- **STREET 1:** AVENUE JOSEPH ANOMA
- **STREET 2:** 01 BP 1387 ABIDJAN 01
- **CITY:** ABIDJAN
- **STATE:** L7
- **ZIP:** 000000
- **BUSINESS PHONE:** 20263050

**MAIL ADDRESS:**
- **STREET 1:** AVENUE JOSEPH ANOMA
- **STREET 2:** 01 BP 1387 ABIDJAN 01
- **CITY:** ABIDJAN
- **STATE:** L7
- **ZIP:** 000000

**INFORMATION STATEMENT**

**![](image_001.jpg)African Development Bank**

*Th e African Development Bank (the "Bank" or "AfDB") intends from time to time to issue debt securities (the "Securities") with maturities and on terms related to market conditions at the time of sale. The Securities may be sold to dealers or underwriters, who may resell the Securities in public offerings or otherwise. In addition, the Securities may be sold by the Bank directly or indirectly through agents.* 

*The specific aggregate principal amount, status, maturity, interest rate, or interest rate formula and dates of payment of interest, purchase price to be paid to the Bank, any terms for redemption or other special terms, currency or currencies, form and denomination of Securities, information as to stock exchange listings and the names and any compensation of the dealers, underwriters or agents in connection with the sale of the Securities being offered at a particular time ("Offered Securities") will be set forth or referred to in a prospectus, offering circular, information memorandum, supplemental information statement, or pricing supplement, together with the terms of offering of the Offered Securities.*

*Securities issued by the Bank are not required to be registered under the U.S. Securities Act of 1933, as amended. Accordingly, no registration statement has been filed with the U.S. Securities and Exchange Commission (the "Commission"). The Securities have not been approved or disapproved by the Commission or any state securities commission nor has the Commission or any state securities commission passed upon the accuracy or adequacy of this Information Statement. Any representation to the contrary is a criminal offence in the United States of America.*

**Recipients of this Information Statement should** **retain it for future reference, since it is intended that each prospectus, offering circular, information memorandum, or supplemental information statement or pricing supplement prepared in connection with the issuance of Offered Securities will refer to this Information Statement for a description of the Bank and its financial condition and results of operation, until a new information statement is issued.**

**11 July 2025**

i

 **AVAILABILITY OF INFORMATION**

The Bank will provide additional copies of this Information Statement and other information with respect to the Bank, including the Agreement Establishing the African Development Bank, as amended (the "Bank Agreement") and its annual report to the Boards of Governors, upon request. Written or telephone requests may be directed to the Bank's address at Immeuble Siege, 6 Avenue Joseph Anoma, Plateau, 01 BP 1387, Abidjan 01, Côte d'Ivoire, Attention: The Treasurer, telephone +225-272-026-2028, facsimile +225-272-024-2155. This Information Statement is also available on the Bank's website (<u>http://www.afdb.org</u>). The annual report and the documents and information on the Bank's website are not intended to be incorporated by reference in this Information Statement.

In the United States, this Information Statement is to be filed with the U.S. Securities and Exchange Commission (the ''SEC'') electronically through the EDGAR system and will be available at the website address <u>https://www.sec.gov/edgar/search-and-access</u>. The Bank has also filed unaudited quarterly financial statements with the SEC. These filings are also available electronically through the EDGAR system.

The issuance of this Information Statement or any prospectus, offering circular, information memorandum, supplemental information statement, pricing circular and the offering and sale of Securities are not a waiver by the Bank or by any of its members, Governors, Directors, Alternates, officers or employees of any of the rights, immunities, privileges or exemptions conferred upon any of them by the Bank Agreement, or by any statute, law or regulation of any member of the Bank or any political subdivision of any member, all of which are hereby expressly reserved.

The Bank uses a unit of account (the "Unit of Account" or "UA") equivalent to the International Monetary Fund's (IMF) Special Drawing Right (SDR) as its reporting currency. The value of the SDR, which may vary from day to day, is currently computed daily in U.S. dollars by the IMF. Except as otherwise specified, all amounts in this Information Statement and any prospectus, offering circular, information memorandum, supplemental information statement or pricing supplement are expressed in UA. Currencies have been translated into UA at the rates of exchange used by the Bank and prevailing on the last day of the period presented. In certain instances, amounts in UA have also been presented in U.S. dollars at the conversion rates set forth below. Such presentations are made solely for convenience and should not be construed as a representation that the UA actually represents, has been or could be converted into U.S. dollars at these or any other rates.

In recent years, there have been significant changes in the relative values of the U.S. dollar and the component currencies of the UA. The Bank makes no representation that would indicate that the U.S. dollar or any other currency accurately reflects the historical financial performance or present financial condition of the Bank. Exchange rates used by the Bank for converting UA into U.S. dollars are as follows:

**As at 31 December**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;**2024** | &nbsp;&nbsp;**2023** | &nbsp;&nbsp;**2022** | &nbsp;&nbsp;**2021** | &nbsp;&nbsp;**2020** |
| &nbsp;&nbsp; Rate of 1 UA = US$ | &nbsp;&nbsp;1.30413 | &nbsp;&nbsp;1.34167 | &nbsp;&nbsp;1.33084 | &nbsp;&nbsp;1.39958 | &nbsp;&nbsp;1.44027 |

---

ii

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| &nbsp;&nbsp;<u>[Summary Information](#a_Toc201234630)</u> | &nbsp;&nbsp;<u>[1](#a_Toc201234630)</u> |
| &nbsp;&nbsp;<u>[The Bank](#a_Toc201234631)</u> | &nbsp;&nbsp;<u>[6](#a_Toc201234631)</u> |
| &nbsp;&nbsp;<u>[Membership of Certain Countries](#a_Toc201234632)</u> | &nbsp;&nbsp;<u>[6](#a_Toc201234632)</u> |
| &nbsp;&nbsp;<u>[Governmental Approval of Borrowings](#a_Toc201234633)</u> | &nbsp;&nbsp;<u>[6](#a_Toc201234633)</u> |
| &nbsp;&nbsp;<u>[Capitalisation](#a_Toc201234634)</u> | &nbsp;&nbsp;<u>[7](#a_Toc201234634)</u> |
| &nbsp;&nbsp;<u>[Summary Statement of Income and Expenses](#a_Toc201234635)</u> | &nbsp;&nbsp;<u>[13](#a_Toc201234635)</u> |
| &nbsp;&nbsp;<u>[Operations of the Bank](#a_Toc201234636)</u> | &nbsp;&nbsp;<u>[14](#a_Toc201234636)</u> |
| &nbsp;&nbsp;<u>[Administration of the Bank](#a_Toc201234637)</u> | &nbsp;&nbsp;<u>[22](#a_Toc201234637)</u> |
| &nbsp;&nbsp;<u>[The Agreement Establishing the African Development Bank](#a_Toc201234638)</u> | &nbsp;&nbsp;<u>[26](#a_Toc201234638)</u> |
| &nbsp;&nbsp;<u>[General Description of the Securities](#a_Toc201234639)</u> | &nbsp;&nbsp;<u>[27](#a_Toc201234639)</u> |
| &nbsp;&nbsp;<u>[Taxation](#a_Toc201234640)</u> | &nbsp;&nbsp;<u>[27](#a_Toc201234640)</u> |
| &nbsp;&nbsp;<u>[Independent Auditor's Report Regarding the Effectiveness of Internal Control over Financial Reporting](#a_Toc201234641)</u> | &nbsp;&nbsp;<u>[30](#a_Toc201234641)</u> |
| &nbsp;&nbsp;<u>[Financial Highlights for the Years Ended 2024, 2023 and 2022](#a_Toc201234642)</u> | &nbsp;&nbsp;<u>[33](#a_Toc201234642)</u> |
| &nbsp;&nbsp;<u>[Membership of France](#France)</u> | &nbsp;&nbsp;<u>[157](#France)</u> |
| &nbsp;&nbsp;<u>[Membership of Germany](#Germany)</u> | &nbsp;&nbsp;<u>[157](#Germany)</u> |
| &nbsp;&nbsp;<u>[Membership of Japan](#Japan)</u> | &nbsp;&nbsp;<u>[157](#Japan)</u> |
| &nbsp;&nbsp;<u>[Membership of Switzerland](#Switzerland)</u> | &nbsp;&nbsp;<u>[157](#Switzerland)</u> |
| &nbsp;&nbsp;<u>[Membership of The United Kingdom](#United_Kingdom)</u> | &nbsp;&nbsp;<u>[157](#United_Kingdom)</u> |
| &nbsp;&nbsp;<u>[Membership of The United States Of America](#USA)</u> | &nbsp;&nbsp;<u>[158](#USA)</u> |

---

iii

**LIS** **T OF ABBREVIATIONS AND ACRONYMS**

---

| | |
|:---|:---|
| &nbsp;&nbsp;AfDB | &nbsp;&nbsp;African Development Bank |
| &nbsp;&nbsp;ADF | &nbsp;&nbsp;African Development Fund |
| &nbsp;&nbsp;ALM | &nbsp;&nbsp;Asset and Liability Management |
| &nbsp;&nbsp;CEAS | &nbsp;&nbsp;Cumulative Exchange Adjustment on Subscriptions |
| &nbsp;&nbsp;DAC | &nbsp;&nbsp;Development Assistance Committee |
| &nbsp;&nbsp;ECP | &nbsp;&nbsp;Euro Commercial Paper |
| &nbsp;&nbsp;EDGAR | &nbsp;&nbsp;Electronic Data-Gathering, Analysis & Retrieval System |
| &nbsp;&nbsp;GCI-IV | &nbsp;&nbsp;Fourth General Capital Increase |
| &nbsp;&nbsp;GCI-V | &nbsp;&nbsp;Fifth General Capital Increase |
| &nbsp;&nbsp;GCI-VI | &nbsp;&nbsp;Sixth General Capital Increase |
| &nbsp;&nbsp;GCI-VII | &nbsp;&nbsp;Seventh General Capital Increase |
| &nbsp;&nbsp;GDIF | &nbsp;&nbsp;Global Debt Issuance Facility |
| &nbsp;&nbsp;HIPC | &nbsp;&nbsp;Heavily Indebted Poor Countries |
| &nbsp;&nbsp;IAS | &nbsp;&nbsp;International Accounting Standard |
| &nbsp;&nbsp;IASB | &nbsp;&nbsp;International Accounting Standards Board |
| &nbsp;&nbsp;IFRS | &nbsp;&nbsp;International Financial Reporting Standards |
| &nbsp;&nbsp;IMF | &nbsp;&nbsp;International Monetary Fund |
| &nbsp;&nbsp;NTF | &nbsp;&nbsp;Nigeria Trust Fund |
| &nbsp;&nbsp;OECD | &nbsp;&nbsp;Organization for Economic Cooperation and Development |
| &nbsp;&nbsp;PML | &nbsp;&nbsp;Prudential Minimum Level of Liquidity |
| &nbsp;&nbsp;PSO | &nbsp;&nbsp;Private Sector Operations |
| &nbsp;&nbsp;RMC | &nbsp;&nbsp;Regional Member Countries |
| &nbsp;&nbsp;SDR | &nbsp;&nbsp;Special Drawing Right |
| &nbsp;&nbsp;UA | &nbsp;&nbsp;Unit of Account |
| &nbsp;&nbsp;USCP | &nbsp;&nbsp;USD Commercial Paper |

---

iv

 **SUMMARY INFORMATION**

**(All numerical data ar** **e as at 31 December 2024, except as otherwise indicated.)**

**General**

The Bank is a regional multilateral development institution established in 1963. The Bank's membership consists of 54 African states (the "Regional Member Countries" or "RMC") and 27 non-African states (the "non-regional member countries").

The central goal of the Bank's activities is promoting sustainable economic growth and reducing poverty in Africa. The Bank provides financing for a broad range of development projects and programmes. In addition, it: (i) provides policy-based loans and equity investments; (ii) finances non-publicly guaranteed private sector loans; (iii) offers technical assistance for projects and programmes that provide institutional support; (iv) promotes the investment of public and private capital; and (v) responds to requests for assistance in coordinating RMC development policies and plans. The Bank also gives high priority to national and multinational projects and programmes that promote regional economic cooperation and integration. The Bank's 2024-2033 strategy (the "Ten Year Strategy") focuses on achieving inclusive growth and assisting Africa to gradually transition to green growth. The Ten-Year Strategy is built around five core operational priorities, specifically, infrastructure development, regional integration, private sector development, governance, skills and technology. To accelerate the delivery on the Ten-Year Strategy and advance the transformation of Africa, the Bank decided in 2015 to place a sharper focus on five priority areas known as "The High 5s". The High 5s are: Light up and Power Africa, Feed Africa, Industrialize Africa, Integrate Africa, and Improve the quality of life for the people of Africa.

The Bank's capital stock is owned by its member countries. On 31 October 2019, at its Fifth Extraordinary Meeting, the Bank's Board of Governors (the "Board of Governors") adopted Resolution B/BG/EXTRA/2019/03 authorising the Seventh General Capital Increase (GCI-VII). At the Fifty-Ninth Annual Meeting of the African Development Bank held on 29 May 2024, the Board of Governors adopted and authorized the General Callable Capital Increase (GCCI) and the creation of 8,812,536 additional callable capital shares, bringing the authorized capital stock of the Bank to UA 240.16 billion as at end December 2024. In accordance with the resolution governing this capital increase, the GCCI shares were allocated to regional and non-regional members in such proportions that, when fully subscribed and paid, the regional group holds 60 percent of the total capital stock and the non-regional group 40 percent.

**Financial Position**

**Assets**

*Loan Portfolio* – The Bank's principal asset is its portfolio of loans. The Bank provides loans to its Regional Member Countries and to public sector enterprises guaranteed by the governments of RMC. It is the Bank's general policy on sovereign lending that each loan to an entity other than a government should be guaranteed by the government within whose jurisdiction the financed project lies. Loans may be granted to eligible private sector entities without a government guarantee. Generally, such loans are secured by collateral. As at 31 December 2024, cumulative loans, net of cancellations, amounted to UA 67.26 billion, an increase of UA 4.47 billion over the UA 62.79 billion as at 31 December 2023. As at 31 December 2024, gross outstanding loans before accumulated provision for expected credit losses (ECLs) were UA 24.19 billion, an increase of UA 1.44 billion over the UA 22.75 billion outstanding as at 2023, while net outstanding loans stood at UA 23.69 billion at end of 2024, an increase of UA I.67 billion over the UA 22.02 billion as at 2023. Although the Bank experiences delays in payments on some of its loans, it expects that sovereign and sovereign guaranteed loans will eventually be paid, and such delays will only affect the timing of the cash flows on the loans. For non-sovereign and sovereign loans, a significant increase in credit risk is considered to have occurred when the borrower's credit rating at the reporting date has been downgraded or when contractual payments are more than 30 days past due and the overdue amount is higher than UA 25,000. In the case of sovereign loans, both conditions - the rating downgrade and the 30 days overdue status with amounts exceeding the set limit – must be met simultaneously for a significant increase in credit risk to be recognized. If in a subsequent period, asset quality improves and the conditions that caused a delay in payment and/or a significant increase in credit risk since origination no longer exist, then the provision for credit losses reverts from lifetime ECLs to 12-months ECLs. Exposures whose credit rating remains within the Bank's investment grade criteria are considered to have a low credit risk even where their credit rating shows indicators of impairment or credit

deterioration.

 

*Liquidity* – The Bank holds sufficient liquid assets to secure the continuity of normal operations even in the unlikely event that it is unable to obtain additional resources from the capital markets for one year. To achieve this, the Bank computes a prudential minimum level of liquidity ("PML") based on the projected net cash requirement for a rolling one-year period. The liquidity policy sets the PML as the Bank's projected net cash requirements for a 1-year horizon and is updated quarterly and computed as the sum of four components: (1) 1-year debt service requirements; (2) 1-year projected net loan disbursements (loans disbursed less repayments) if greater than zero; (3) the loan equivalent value of signed guarantees; and (4) undisbursed equity investments. The maximum level of liquidity is determined by the Bank's debt limits.

**Liabilities, Capital and Reserves**

*Li abilities –* As at 31 December 2024, the Bank's total borrowings amounted to UA 26.40 billion, an increase of UA 1.62 billion over UA 24.78 billion as at 31 December 2023. The Bank raises resources in a cost-effective manner across markets to finance programmes and projects in its regional member countries and to meet its liquidity requirements. The capital adequacy framework approved by the Bank's Board of Directors (the "Board of Directors") adopted the use of a single debt to usable capital ratio to monitor the Bank's leverage. The ratio caps the Bank's total outstanding debt at 100 percent of usable capital. Usable capital comprises the equity of the Bank and the callable capital of its non-borrowing members rated A- or higher. The Bank's usable capital on 31 December 2024 was UA 68.10 billion and its debt to usable capital ratio, a measure of the Bank's financial leverage, was 38.77 percent.

*Capital and Reserves –* Subscriptions to the capital stock of the Bank are made up of initial subscriptions to the capital, a voluntary capital increase, a series of special capital increases and general increases of the Bank's capital. On 31 October 2019, the Board of Governors approved the Seventh General Capital Increase (GCI-VII). GCI-VII increased the authorised capital stock of the Bank by 125% from UA 69.47 billion to UA 153.19 billion with the creation of 8,371,881 new shares.

The par value of one share of the Bank's capital is UA 10,000. The newly created 8,371,881 GCI-VII shares are composed of paid-up shares (6 percent) and callable shares (94 percent). The shares of the Bank are allocated to the regional and non-regional members such that, when fully subscribed, the regional members will hold 60 percent of the total capital stock of the Bank and the non-regional members will hold the balance of 40 percent.

At the Fifty-Ninth Annual Meeting of the African Development Bank held on 29 May 2024, the Board of Governors approved, by Resolution B/BG/2024/09, the General Callable Capital Increase of UA 88.13 billion to preserve the Bank's lending capacity. This approval increased the Bank's authorized capital from UA 152.03 billion to UA 240.16 billion.

As at 31 December 2024, of the Bank's total subscribed capital of UA 163.50 billion, an amount of UA 9.97 billion (6 percent) represented the paid-up portion and UA 153.53 billion (94 percent) was callable. The portion of paid-up capital for which the Bank has received payment, referred to as paid-in capital, amounted to UA 7.53 billion as at 31 December 2024.

As at 31 December 2024, the callable capital of the Bank's 27 non-regional member countries was UA 62.36 billion, which represented 236.17 percent of the Bank's total outstanding borrowings as at 31 December 2024. As at 31 December 2024, the callable capital of the Bank's 21 industrialised member countries that are also members of the Development Assistance Committee ("DAC") of the Organisation for Economic Cooperation and Development ("OECD") (namely Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, Korea, Luxembourg, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, Türkiye, the United Kingdom and the United States) was UA 59.04 billion, representing 223.59 percent of the Bank's total outstanding borrowings as at 31 December 2024.

Under the Bank Agreement, the total amount outstanding in respect of the ordinary operations of the Bank (consisting of approved loans less cancellations and repayments, plus equity participations) shall not at any time exceed the total amount of its unimpaired subscribed capital, reserves, and surplus. Such total amount outstanding

as at 31 December 2024 was UA 35.05 billion and such total capital (net of the Cumulative Exchange Adjustment on Subscriptions ("CEAS"), reserves and surplus) was UA 175.74 billion, resulting in a ratio of 19.95 percent. The ratio of disbursed and outstanding loans (including irrevocable commitments to pay undisbursed amounts) to equity was 198 percent. The Bank's total equity (paid-in capital net of CEAS, Hybrid Capital and reserves) also referred to as risk capital, amounted to UA 12.24 billion. The risk capital utilization rate, which measures the amount of capital consumed by the Bank's activities, was 44.8 percent.

**Financial Performance and Profitability**

Although profit maximisation is not a primary objective, the Bank has earned a profit in every year since it began operations in 1966, except in 2015. For 31 December 2024, the reported income before distributions approved by the Board of Governors of the Bank was UA 354.41 million compared to UA 406.05 million in 2023. The Bank does not distribute dividends to its shareholders. Under the Bank Agreement, reserves have first claim on net income. After a determination has been made regarding the amount to be retained in reserves, any remaining amount is allocated to: (i) fulfil commitments or conditional undertakings approved by the Board of Governors; (ii) a surplus account; and/or (iii) distributed to key initiatives.

**Accounting Standards**

The financial statements of the Bank are prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

**Risk Management and Internal Control**

The Bank seeks to minimise its exposure to risks that are not essential to its core business of providing development finance and related assistance. Accordingly, the Bank's risk management policies, guidelines and practices are designed to reduce exposure to interest rate, currency, liquidity, counterparty, legal and other operational risks while maximising the Bank's capacity to assume credit risks to public and private sector clients, within its approved risk limits. The Bank's risk management policies and practices are included in the notes to the financial statements.

Following the approval by the Board of Directors in 2004, the Bank established an Internal Control Unit (ICU) to implement, among other duties, the Committee of Sponsoring Organizations (COSO) control framework to regularly evaluate the effectiveness of its internal controls in all significant business operations. Management and the External Auditors issue an annual attestation on the effectiveness of the Bank's internal controls over financial reporting as part of the annual audit process. The attestations at the end of 2024 are included elsewhere in this document.

**The above information is qualified by the detailed information and financial statements appearing elsewhere in this Information Statement.**

**SUMMARY OF SELECTED FINANCIAL DATA**

*(Amounts expressed in millions of UA)*

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Years Ended 31 December** | **Years Ended 31 December** | **Years Ended 31 December** | **Years Ended 31 December** |
| | **2024** | **2023** | **2022** | **2021** |
| Cash, Investments | 15230.65 | 13765.81 | 14543.36 | 13097.04 |
| Approved Loans less Cancellations: |  |  |  |  |
| Disbursed and outstanding | 24191.76 | 22749.18 | 21427.59 | 20661.96 |
| Undisbursed (1) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9770.20 | 8964.66 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9252.12 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8803.24 |
| Outstanding Borrowings: |  |  |  |  |
| Total | 26404.03 | 24776.41 | 24254.21 | 25115.71 |
| Senior | 26404.03 | 24776.41 | 24246.70 | 25037.21 |
| Subordinated | - | - | 7.51 | 78.50 |
| Authorised Capital | 240159.72 | 180638.83 | 180638.83 | 180638.83 |
| Subscribed Capital and Reserves: |  |  |  |  |
| Paid-up capital | 9972.38 | 9935.01 | 9974.54 | 9958.90 |
| Callable capital | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;153532.42 | 138177.87 | 138793.64 | 138514.72 |
| Total callable - non-regional members | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;62359.38 | 56771.58 | 56751.21 | 56523.92 |
| Total callable - members of the DAC of the OECD | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;59036.27 | 3440.01 | 53419.64 | 53290.97 |
| Total Reserves | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4285.76 | 4014.34 | 3670.66 | 3151.19 |
| Cash and Investments as a Percentage of |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Undisbursed portion of approved loans | 155.89% | 153.56% | 157.19% | 148.78% |
| &nbsp;&nbsp;&nbsp;&nbsp;Outstanding borrowings | 57.68% | 55.56% | 59.96% | 52.15% |
| Disbursed and Outstanding Loans as a Percentage of |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Subscribed Capital plus Hybrid Capital & Reserves (2)(3) | 14.38% | 14.97% | 14.07% | 13.64% |
| Total Outstanding Borrowings as a Percentage of |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total callable capital | 17.20% | 17.93% | 17.48% | 18.13% |
| &nbsp;&nbsp;&nbsp;&nbsp;Callable capital of non-borrowing members | 42.34% | 43.64% | 42.74% | 44.43% |
| &nbsp;&nbsp;&nbsp;&nbsp;Callable capital of DAC members of OECD | 44.73% | 46.36% | 45.40% | 47.13% |
| Senior Debt as a Percentage of |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total callable capital | 17.20% | 17.93% | 17.47% | 18.08% |
| &nbsp;&nbsp;&nbsp;&nbsp;Callable capital of non-borrowing members | 42.34% | 43.64% | 42.72% | 44.29% |
| &nbsp;&nbsp;&nbsp;&nbsp;Callable capital of DAC members of OECD | 44.73% | 46.36% | 45.39% | 46.98% |
| Total Outstanding Borrowings as a Percentage of |  |  |  |  |
| Usable Capital(4) | 38.77% | 40.590% | 40.30% | 42.70% |
| Total Reserves as a Percentage of |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Disbursed and outstanding loans(3) | 17.72% | 17.65% | 17.13% | 15.25% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total outstanding borrowings | 16.23% | 16.20% | 15.13% | 12.55% |
| Income before transfers approved by the Board of Governors | 354.41 | 406.05 | 239.28 | 96.55 |
| Weighted Average Interest Rate on: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Disbursed and Outstanding Loans for the Year | 6.05% | 5.54% | 2.48% | 1.66% |
| Weighted Average Cost of: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Debt contracted during the year | 2.56% | 2.22% | 1.83% | 1.66% |
| &nbsp;&nbsp;&nbsp;&nbsp;Outstanding borrowings (5) | 5.52% | 4.89% | 1.50% | 0.30% |
| Average Life of Outstanding Borrowings (Years) | 3.65 | 3.28 | 4.17 | 4.05 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| Interest coverage ratio (6) (1.25x)(7) | 1.25X | 1.34x | 1.68x | 2.36x |
| Risk Capital Utilization Rate (RCUR)(8) | 44.8% | 53.70% | 55.94% | 84.30% |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Excludes loans approved but unsigned

&nbsp;&nbsp;&nbsp;&nbsp;(2) Subscribed capital is net of the Cumulative Exchange Adjustment on Subscriptions

&nbsp;&nbsp;&nbsp;&nbsp;(3) Net of the Special Reserve. Disbursed and outstanding loans include irrevocable reimbursement guarantees

&nbsp;&nbsp;&nbsp;&nbsp;(4) The Bank's policy limits the debt to usable capital ratio to 100 percent. The usable capital is defined as the sum of paid in capital, reserves and callable capital from non-borrowing countries rated A- or better

&nbsp;&nbsp;&nbsp;&nbsp;(5) The weighted average cost on borrowings excludes the mark-to-market ("MTM") impact

&nbsp;&nbsp;&nbsp;&nbsp;(6) Operating income plus interest expense, divided by interest expense

&nbsp;&nbsp;&nbsp;&nbsp;(7) Indicates the Bank's target ratio

&nbsp;&nbsp;&nbsp;&nbsp;(8) The Bank's policy limits the RCUR to 100 percent

**The above information should be read in conjunction with the annual financial statements for the respective periods and is qualified by the detailed information and financial statements appearing elsewhere in this Information Statement.**

 **THE BANK**

The Bank is a regional multilateral development institution with membership comprising 54 African states and 27 non-African states from the Americas, Asia, and Europe (the "regional members" and "non- regional members", respectively). The Bank was established in 1963 and operates under the Bank Agreement signed in Khartoum, Sudan, on 4 August 1963. The Bank began operations in 1966 with 29 regional members. The Bank Agreement was amended on 7 May 1982 to permit non-regional countries to be admitted as members. A list of the members as at 31 December 2024 showing each member's voting power and the amount of its subscription to the Bank's capital stock is provided in Note M to the financial statements included herein. In conformity with the finding of the United Nations' General Assembly, the membership of the former Yugoslavia was formally suspended by the Board of Directors (see Note M to the financial statements included herein).

The central goal of the Bank's activities is promoting sustainable economic growth and reducing poverty in Africa. The Bank provides financing for a broad range of development projects and programmes. In addition, it: (i) provides policy-based loans and equity investments; (ii) finances non-publicly guaranteed private sector loans; (iii) offers technical assistance for projects and programmes that provide institutional support; (iv) promotes the investment of public and private capital; and (v) responds to requests for assistance in coordinating RMC development policies and plans. The Bank also gives high priority to national and multinational projects and programmes that promote regional economic cooperation and integration. The Bank's Ten-Year Strategy 2024-2033: Seizing Africa's Opportunities for a Prosperous, Inclusive, Resilient and Integrated Continent (the "Ten-Year Strategy") focuses on accelerating inclusive green growth and fostering prosperous and resilient economies. The Bank is responding to these core objectives by scaling up investment and implementation of the Ten-Year Strategy by focusing on five priority areas, referred to as the "High 5s". The High 5s are to "Light up and power Africa"; "Feed Africa"; "Industrialize Africa"; "Integrate Africa" and "Improve the quality of life for the people of Africa".

The Bank's ordinary operations are financed from its ordinary capital resources. The ordinary capital resources include subscribed capital stock, borrowings by the Bank, loan repayments, income from loans, equity investments and guarantees and other funds and income received by the Bank in its ordinary operations. The capital stock of the Bank is divided into paid-up capital and callable capital. The Bank's paid-up capital is the amount of capital payable over a period specified in the Board of Governors' resolution approving the relevant capital increase. The callable capital is subject to call only as and when required by the Bank, to meet obligations incurred on funds borrowed or loans guaranteed.

In addition to its ordinary operations, the Bank administers the African Development Fund (the "ADF"), which provides loan financing on concessionary terms to RMC that are in the greatest need of such financing. The ADF is legally and financially separate from the Bank, and the Bank is not liable for any obligations of the ADF. The Bank also administers, under separate agreements and arrangements, the Nigeria Trust Fund (the "NTF") and several other special and trust funds. The resources of these special and trust funds are held, committed and otherwise disposed of entirely separately from the Bank's ordinary capital resources (see Note V-3, V-4 and V-5 to the Financial Statements included herein).

**MEMBERSHIP OF CERTAIN COUNTRIES**

Information with respect to the membership and total subscription of certain member countries, including the United States, Japan, France, Germany, Switzerland and the United Kingdom, is included on the inside back cover in copies of this Information Statement circulated in such respective countries.

**GOVERNMENTAL APPROVAL OF BORROWINGS**

As required by the Bank Agreement, offerings of Securities will only be made in the currency or markets of a member country after the government of such member has consented to the raising of funds by the Bank and the issuance of Securities in such currency or markets and has agreed that the proceeds from the sale of securities may be exchanged for the currency of any other country without restriction.

 **CAPITALISATION**

**General**

The following table sets forth the outstanding borrowings, capital stock and reserves and net income of the Bank as at 31 December 2024 and 2023:

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| | | |
|:---|:---|:---|
| **(in UA million)** | **2024** | **2023** |
| **Outstanding Borrowings(1)** |  |  |
| Debt Payable in: |  |  |
| U.S. Dollar | 13434.27 | 10263.33 |
| Euro | 4919.37 | 5921.52 |
| Japanese Yen | 1077.27 | 1228.64 |
| Other currencies | 6973.12 | 7362.91 |
| Total debt (\*) | 26404.03 | 24776.41 |
| Of which : Total Senior Debt (\*) | 26404.03 | 24776.41 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Subordinated Debt (\*) | - | - |
| **Capital Stock and Reserves(2)** |  |  |
| Authorised capital | 240159.72 | 180638.83 |
| Unsubscribed capital | 76654.92 | 32525.95 |
| Subscribed capital | 163504.80 | &nbsp;&nbsp;&nbsp;&nbsp;148112.88 |
| Less: Callable capital | (153532.42) | (138177.87) |
| Paid-up capital | 9972.38 | 9935.01 |
| Shares to be issued upon payment of future instalment | (2439.49) | (2983.92) |
| Amount paid in advance | 0.59 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.59 |
| Amount in arrears | - | - |
| Cumulative Exchange Adjustment on Subscriptions (CEAS) | (146.71) | (151.64) |
| Capital net of CEAS | 7386.77 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6800.05 |
| Reserves for the Year | 4285.76 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4014.34 |
| Hybrid capital | 563.86 | - |
| Total Capital and Reserves | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12236.39 | 10814.34 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) For a description of the Bank ' s
borrowing policies and the currency distributions and other details with respect to borrowi n gs,
as well as the e f fects of currency and interest rate swaps undertaken by the Bank on the currency
composition and weighted average int e rest cost of the Bank ' s
payment obligations, see "Borrowings" and Note K to the financial statements included herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) For a more complete description of subscriptions to the capital stock and voting
power, see Note M to the financial statements included herein. For a more complete description of Reserves, see Note M to the financial
statements included herein.

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| | |
|:---|:---|
| (\*) | Figures represent total carrying amount of borrowings measured at fair value and those held at amortized costs in the financial statements (amount shown inclusive of net unamortised premium/discounts). |

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**Authorised Capital**

The Bank's original authorised capital stock of UA 250 million has been increased in line with the provisions of the Bank Agreement, which provides that the authorised capital stock may be increased as and when the Board of Governors deems it advisable. The authorised capital stock of the Bank has undergone several increases recently. Four special capital increases were approved in 2008 (Resolution B/BG/2008/07), 2009 (Resolution B/BG/2009/05), 2012 (Resolution B/BG/2012/04) and 2019 (Resolution B/BG/2019/04), to enable membership and subscription of shares by the Republic of Türkiye, the Grand Duchy of Luxembourg, the Republic of South Sudan, and Ireland, respectively.

In 2009, Canada and Korea responded favourably to the Bank's need for expanded financial capacity pending decisions on a sixth General Capital Increase (GCI-VI) of the Bank by a temporary increase of their callable capital with no attached voting rights. The special capital increase, adopted by the Board of Governors Resolution B/BG/2010/02, brought the authorised capital of the Bank to UA 23.95 billion. The Resolution provided for the retirement and cancellation of the temporary callable capital subscribed by Canada (UA 1.63 billion) and the Republic of Korea (UA 0.19 billion) upon the effectiveness of their respective subscriptions to a general capital increase and pursuant to authorization by the Board of Governors.

GCI-VI was approved by the Board of Governors' Resolution B/BG/2010/08, raising the authorised capital of the Bank from UA 23.95 billion to UA 67.69 billion, representing a 200 percent increase of the Bank's authorised capital (excluding Canada and Korea's temporary callable capital and special capital increases for Türkiye and Luxembourg) with a paid-up capital of 6 percent. The shares created under GCI-VI were allocated to regional and non-regional members in such proportions that when fully subscribed, the regional members would hold 60 percent of the total voting power, and the non-regional members would hold 40 percent of the total voting power. Pursuant to due authorisation by resolutions of the Board of Governors, the temporary callable shares of Canada and Korea were cancelled in 2011 and 2012, respectively.

In 2019, the Board of Governors adopted and authorised the creation of non-voting temporary callable capital of 115,700 shares as part of the interim measures pending the conclusion of the Seventh General Capital Increase (GCI-VII). Canada subscribed for 79,000 shares and Sweden for 35,700 shares in July 2019 and December 2019 respectively. In line with the terms of their subscriptions, both member countries returned the non-voting temporary callable shares to the Bank following the effectiveness of their subscriptions to GCI-VII on 10 December 2020 for Sweden, and 18 February 2021 for Canada.

On 31 October 2019, the Board of Governors approved GCI-VII, representing a 125 percent increase of the capital resources of the Bank. Consequently, GCI-VII increased the authorized capital stock of the Bank from UA 69.47 billion[1](#note_ftn1) to UA 153.19 billion with the creation of 8,371,881 new shares. The new shares are allocated to the regional and non-regional members in such proportions that, when fully subscribed, the regional members would hold 60 percent of the total voting power of the Bank, whilst the non-regional members would hold 40 percent of the total voting power. The new capital stock of the Bank is divided into paid-up and callable shares in the proportion of 6 percent and 94 percent respectively.

The paid-up portion of the GCI-VII subscription is payable in twelve annual instalments for member countries eligible to receive financing from ADF and eight annual instalments for member countries not eligible to receive financing from ADF. A member country's payment of the first instalment triggers its subscription, and the entire callable shares are issued. Shares representing the paid-up portion of the subscription are issued only as and when the Bank receives the actual payments for such shares.

At the Seventh Extraordinary General Meeting held on 5 March 2021, the Board of Governors adopted and authorized the creation of 2,860,447 temporary callable capital shares increasing the Bank's authorised capital from UA 153,191,360,000 to UA 181,795,830,000. The new shares created which are in the form of callable shares, expired on 31 December 2023. All Instruments of Subscription are qualified and effective only in the case of a single

1 The amount of UA 69,472,550,000 includes: (i) the special capital increase of UA 1,340,500,000, authorized under Resolution B/BG/2019/04 to allow the Republic of Ireland to subscribe to UA 536,200,000. The remainder of UA 804,300,000 were to be subscribed by RMC to maintain the 60 percent - 40 percent ratio between RMC and non-RMC; (ii) the temporary increase in non-voting callable capital of UA 800,000,000 allocated to the Government of Canada under Resolution B/BG/2019/09 ; and (iii) the temporary increase in non-voting callable capital of UA 357,000,000 allocated to the Kingdom of Sweden pursuant to Resolution B/BG/EXTRA/2019/01.

event leading to a reduction in the stock of the Bank's AAA-rated callable capital by at least 30 percent that would have the effect of reducing the coverage of the Bank's net debt by AAA-rated callable capital below 100 percent (the "Qualifying Event"). Upon the occurrence of the Qualifying Event, members who have subscribed to the temporary callable capital stock will acquire certain voting rights. Each share will have a par value of UA 10,000, as set forth in the Resolution.

At the same Seventh Extraordinary Meeting held on 5 March 2021, the Board of Governors approved the requests to cancel the non-voting temporary callable shares of the Kingdom of Sweden and Canada mentioned above. In addition to the cancellation process, the Board of Governors approved a commensurate reduction in the authorised capital stock of the Bank by 115,700 shares in conformity with Article 29(2)(a) of the Agreement establishing the Bank. The authorised capital of the Bank was thus reduced by UA 1,157,000,000, bringing it down to its current level of UA 180,638,830,000.

On 31 December 2023, the 2,860,447 callable shares created under Special Temporary Callable Capital Increase expired, and all the shares allocated to member countries were returned to the Bank in accordance with Resolution B/BG/EXTRA/2021/05. These shares remain in the Bank's authorized capital, which will be decreased from 18,063,883 shares to 15,203,436 shares upon approval by the Board of Governors of the Resolution authorizing their cancellation as provided for in paragraph 2(a) of Article 29 of the Agreement Establishing the Bank.

At the Fifty-Ninth Annual Meeting of the African Development Bank held on 29 May 2024, the Board of Governors approved, by Resolution B/BG/2024/09, the General Callable Capital Increase of UA 88,125,360,000 to preserve the Bank's lending capacity. This approval increased the Bank's authorized capital from UA 152,034,360,000 to UA 240,159,720,000.

**Subscribed Capital**

Member countries subscribe to the capital of the Bank by depositing an instrument of subscription. The subscription is deemed effective when the member country pays the first instalment of the paid-up capital. The shares representing the paid-up portion are issued when the Bank receives the actual payments for such shares, while the entire callable shares are issued upon the payment of the first instalment of the paid-up capital.

As at 31 December 2024, the total subscribed capital of the Bank amounted to UA 163.50 billion of which, an amount of UA 9.97 billion (6 percent) was paid-up capital and UA 153.53 billion (94 percent) was callable capital.

The Bank Agreement provides that shares of capital stock are to be issued at par value (UA 10,000 per share), unless the Board of Governors decides by a majority vote to issue them on other terms. The liability of the members is limited to the unpaid portion of the issue price of the shares. Shares are transferable only to the Bank.

**Callable Capital**

As at 31 December 2024, the Bank's total callable capital was UA 153.53 billion. Of this amount, UA 62.36 billion represented the callable capital of the Bank's non-regional member countries. The callable capital of the 21 Bank members, who are also members of the DAC of the OECD, was UA 59.04 billion.

Callable capital is that portion of the subscribed capital stock subject to call only as and when required by the Bank to meet its obligations on borrowings of funds for inclusion in its ordinary capital resources or guarantees chargeable to such resources. In the event of a call, payment must be made by the member countries concerned in gold, convertible currency or in the currency required to discharge the obligation of the Bank for which the call was made.

Calls on the callable capital are required to be uniform in percentage on all shares of capital stock, but obligations of the members to make payment upon such calls are independent of each other. The failure of one or more members to make payments on any such call would not excuse any other member from its obligation to make payment. Further calls can be made on non-defaulting members, if necessary, to meet the Bank's obligations. However, no member could be required to pay more than the unpaid balance of its ordinary capital subscription. No call has ever been made on the callable capital of the Bank.

**Paid-up Capital**

As at 31 December 2024, the total paid-up capital stock of the Bank amounted to UA 9.97 billion.

The Board of Governors determines the modes of payment for paid-up capital stock as well as the period over which payment is to be made. Prior to May 1981, all payments in respect of the paid-up capital were required to be made in convertible currencies. However, with respect to subscriptions under the capital increases authorised in May 1979 (but effective December 1982) and in May 1981, regional members had the following two options for making their payments: (i) five equal annual instalments, of which at least 50 percent is payable in convertible currency and the remainder in local currency; or (ii) five equal annual instalments, of which 20 percent is payable in convertible currency and 80 percent in non-negotiable, non-interest bearing notes. Such notes were payable solely in convertible currency in ten equal annual instalments, commencing on the fifth anniversary of the first subscription payment date. Non-regional members were required to make their payments solely in convertible currencies.

For GCI-IV, regional members were required to make payment for their subscriptions as follows: (i) 50 percent in five equal annual instalments in cash in freely convertible currencies; and (ii) 50 percent by the deposit of five non-negotiable, non-interest-bearing notes of equal value denominated in UA and payable between the sixth and tenth year of subscription in convertible currencies according to a specific schedule. For non-regional members, payments were to be made in five equal annual instalments in their national currencies, if such currencies were freely convertible, or in notes denominated in convertible currencies and payable on demand.

For GCI-V, the paid-up portion of the shares was payable in eight equal and consecutive annual instalments, in convertible currencies.

For GCI-VI, the paid-up portion of the shares was payable in twelve equal and consecutive annual instalments for those members eligible to receive financing exclusively from the ADF, and in eight equal and consecutive annual instalments by all other members. Payments were only made in convertible currencies. Shares representing the paid-up portion of subscriptions were only issued when the Bank received actual payments for such shares.

For GCI-VII, the paid-up portion of the subscription is payable in eight equal annual instalments for member countries not eligible to borrow from the ADF, and in twelve equal annual instalments for member countries eligible to borrow from the ADF. Some member countries have elected to pay their subscription in fewer instalments, opting for the advance payment scheme, and have received a commensurate discount on their GCI-VII subscription.

The paid-in capital is the portion of the paid-up capital that has actually been received. As at 31 December 2024, the total paid-in capital of the Bank was UA 7.53 billion made up of: (1) UA 7.418 billion paid in convertible currencies; and (2) UA 115.17 million paid in local currencies.

For a more complete description of subscriptions to capital stock, including amounts due but unpaid, and voting power of members, see Note M of the financial statements.

**Cumulative Exchange Adjustment on Subscriptions** 

As at 31 December 2024, the Cumulative Exchange Adjustment on Subscriptions (''CEAS'') representing the translation difference on subscriptions was a negative UA 146.71 million. It should be noted that prior to GCI-IV, payments on the share capital subscribed by the non-regional member countries were fixed in terms of their national currencies. Furthermore, payments by regional and non-regional members in US dollars were fixed at an exchange rate of 1 UA= USD 1.20635 (GCI-IV and GCI-V), and at a fixed exchange rate of 1 UA = EUR 1.30777 for Euro. Fixed exchange rates were also offered for the Special Drawing Right (SDR) basket currency under GCI-VI and GCI-VII. As a result, losses and gains could arise from converting these currencies to UA when received. Such conversion differences are reported in the CEAS account.

**Non-Bor** **rowing Members** 

The following table sets forth the callable portion of the capital subscription and the total capital subscription of non-borrowing members as at 31 December 2024<sup>**(1)**</sup>.

*(Expressed in UA million)*

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| | | |
|:---|:---|:---|
| **Country** | **Callable capital** | **Total capital issued** |
| Argentina | 103.06 | 11.024 |
| Austria\* | 607.66 | 64.252 |
| Belgium\* | 873.75 | 93.548 |
| Brazil | 200.94 | 21.791 |
| Canada\* | 5240.24 | 560.607 |
| China | 1755.92 | 185.651 |
| Denmark\* | 1594.72 | 168.66 |
| Finland\* | 665.24 | 70.046 |
| France\* | 5111.09 | 538.171 |
| Germany\* | 9198.27 | 952.36 |
| India | 391.86 | 41.376 |
| Ireland\* | 1125.67 | 116.57 |
| Italy\* | 3302.85 | 349.229 |
| Japan\* | 7494.71 | 792.484 |
| Korea\* | 655.31 | 68.968 |
| Kuwait | 607.66 | 63.983 |
| Luxembourg\* | 283.95 | 29.709 |
| Netherlands\* | 1946.22 | 201.45 |
| Norway\* | 1604.12 | 169.596 |
| Portugal\* | 327.3 | 34.471 |
| Saudi Arabia | 263.67 | 27.763 |
| Spain\* | 1443.1 | 154.377 |
| Sweden\* | 3467.52 | 359 |
| Switzerland\* | 1995.78 | 210.657 |
| Türkiye\* | 543.26 | 56.839 |
| United Kingdom\* | 2538.27 | 271.589 |
| United States of America\* | 9017.24 | 949.506 |
| **Total** | **62359.38** | **6563.68** |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) See Note M to the financial statements included herein
for a more complete description of the capital subscriptions of all m embers of the Bank as at 31 December 2024. As a 31 December 2024, the 27 members listed above held 41.237 percent of the total voting powers of the Bank.

\* Member of the DAC of the OECD.

**Maintenance of Cur** **rency Values**

Pursuant to the Bank Agreement, each member is required to pay to the Bank any additional amount of its national currency necessary to maintain the value of all such national currency paid to the Bank on account of its subscription whenever the par value of the member's currency in terms of the UA or its foreign exchange value has, in the opinion of the Bank, depreciated to a significant extent. In the event of an increase in such par value or such foreign exchange value, the Bank is required, pursuant to the Bank Agreement, to pay to the member an amount of its currency necessary to adjust in a similar way the value of all such national currency held by the Bank on account of its subscription.

It was decided in 1979 by the Board of Governors that the application of the maintenance of value would be suspended until such time as the Board of Directors determines that the SDR is being definitively applied as the unit of value applicable to members' subscriptions in the International Bank for Reconstruction and Development (the "World Bank") for purposes of the maintenance of value provisions of its Articles of Agreement. In October 1986, the World Bank decided that the capital stock of the World Bank would be valued in terms of the SDR, at the rate at which the SDR was valued in terms of US dollars immediately before the introduction of the basket method of valuing the SDR on 1 July 1974. This value was 1 SDR= USD 1.20635.

**V** **oting Rights**

Each member country has 625 votes and, in addition, one vote for each share of the capital stock of the Bank held by that member. In effect, a member country is allowed to exercise: (1) the votes attributed to the portion of the paid-up shares which have been issued to such member; and (2) the votes attributable to the entire callable capital portion of the stock subscribed when the subscription of such member is deemed effective.

In the event of any delay or default in payment of the paid-up capital, the member's right to vote the corresponding callable shares will be suspended until the payment is received by the Bank.

**Reserves**

Reserves consist of retained earnings, fair value gains/losses on investments designated at fair value through other comprehensive income, gains/losses on borrowings at fair value arising from "own credit", and remeasurements of defined benefit liability. Retained earnings include the net income for the year, after taking into account distributions approved by the Board of Governors, and net charges recognized directly in equity. Net Income before distributions approved by the Board of Governors for the year ended 31 December 2024 amounted to UA 354.41 million, compared to UA 406.05 million in 2023, representing a decrease of 12.72 percent on a year-on-year basis.

**Hybrid Capital**

The Bank issued deeply subordinated and perpetual hybrid capital (or Notes) with 5.75% resettable coupon rate on 30 January 2024. The hybrid capital issue had a proceed of UA 563.86 million (USD 750 million) with a 0.5% percent transaction cost of UA 2.83 million (USD 3.75 million). The Bank has the sole and absolute discretion to call or redeem the hybrid capital (on the occurrence of certain or repurchase events) and to pay the discretionary coupon and principal to the holders. The discretionary coupon is non-accruing and would only be deemed payable to the holders, if declared and approved by the Bank. If a trigger event occurs, and the set threshold (7.5x) is breached, payment of the discretionary coupon must be cancelled. Also, the hybrid capital would be written down if certain events occur.

The holders of the hybrid capital do not hold any shares or voting rights in the Bank, neither does the Bank have any contractual obligations to repay either the principal or coupon on the hybrid capital; all repayment decisions are the sole and absolute discretion of the Bank.

Based on the instrument's contractual terms, the hybrid capital meets the definition of equity under IFRS requirements and was classified and presented as equity in the Bank's financial statements. As such, all consideration received from the issue (e.g. proceeds) and all consideration paid (e.g. transaction costs and discretionary coupons) are directly recorded in equity. Also, the hybrid capital was recorded at historical cost and would not be retranslated or remeasured over time.

 **SUMMARY STATEMENT OF INCOME AND EXPENSES**

The following summary of income and expenses relating to the ordinary capital resources of the Bank for the years ended 31 December 2024, 2023, 2022 and 2021, has been derived from the audited financial statements of the Bank for the respective years. This summary should be read in conjunction with the audited financial statements and related notes for the respective years.

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| | | | | |
|:---|:---|:---|:---|:---|
|  (Expressed in UA million) |  |  |  |  |
|  Years ended 31 December | **2024** | **2023** | **2022** | **2021** |
| OPERATIONAL INCOME & EXPENSES |  |  |  |  |
| Income from: |  |  |  |  |
| Loans and related derivatives | 1419.01 | 1223.55 | 521.57 | 348.24 |
| Treasury Investments and related derivatives | 534.49 | 459.60 | 218.16 | 129.34 |
| Equity participation investments (Dividends) | 20.22 | 20.48 | 14.19 | 23.86 |
| Other securities | 11.69 | 7.94 | 6.89 | 5.53 |
| **Total Income from Loans and Treasury Investments** | **1985.41** | **1711.57** | **760.80** | **506.97** |
| Borrowing expenses |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; Interest and amortised issuance costs | (647.97) | (515.69) | (418.13) | (393.78) |
| &nbsp;&nbsp;&nbsp;&nbsp; Net interest on borrowing-related derivatives | (754.77) | (676.02) | 64.14 | 322.73 |
| &nbsp;&nbsp;&nbsp;&nbsp;Unrealised gains/(losses) on borrowings at FVTPL and related derivatives | (7.81) | 59.48 | 88.90 | (111.21) |
| Provision for impairment on loan principal and charges receivables | 9.47 | (18.29) | (97.02) | (24.97) |
| Impairment (charges)/write-back on treasury investments | (0.05) | (0.03) | 0.03 | (0.07) |
| Impairment (charges)/write-back on financial guarantee | (3.95) | (1.43) | 0.87 | (0.16) |
| Impairment (charges)/write-back on equity accounted investments | (0.28) | 0.68 | 1.53 | (0.26) |
| Translation (losses)/gains | (1.27) | (10.98) | 66.457 | (1.48) |
| Other income | 20.01 | 18.32 | 13.99 | 13.43 |
| **Net Operational Income** | **598.81** | **567.61** | **481.57** | **311.21** |
| OTHER EXPENSES |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Bank Group administrative expenses (\*) | 464.66 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;306.68 | 453.88 | 393.36 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share of expenses allocated to ADF and NTF | (256.97) | (172.33) | (246.72) | (218.82) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net administrative expenses** | **207.69** | **133.12** | **207.16** | **174.55** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation - Property, equipment and intangible assets | 34.84 | 28.09 | 29.09 | 32.75 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sundry expenses | 1.87 | 0.36 | 6.04 | 7.36 |
| **Total Other Expenses** | **244.40** | **161.57** | **242.30** | **214.66** |
| Net Income before distributions approved by the Board of Governors | 354.41 | 406.05 | 239.28 | 96.55 |
|  Distribution approved by the Board of Governors | (106.00) | (46.00) | (64.00) | (55.00) |
| **NET INCOME FOR THE YEAR** | **248.41** | **360.05** | **175.28** | **41.55** |

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*(\*) The Bank Group is composed of three entities: the African Development Bank, the African Development Fund and the Nigeria Trust Fund*

 **OPERATIONS OF THE BANK**

**Lending Operations**

The Bank is authorised under the Bank Agreement to make, participate in or guarantee loans to governments of its regional member countries, their agencies and political subdivisions, and to public and private enterprises operating within such countries, as well as to international or regional entities concerned with economic development in the region. It is the general policy of the Bank that all loans be made to or guaranteed by national governments, central banks or other governmental entities engaging the full faith and credit of such governments. The Bank, however, has adopted a strategy and policies for the promotion of the private sector in RMC under which loans, equity and equity-linked products, such as subordinated loans, may be granted to eligible private sector entities without a government guarantee. Such loans are generally secured by collateral.

Under the Bank Agreement, the total amount outstanding in respect of the ordinary operations of the Bank (comprised of approved loans less cancellations and repayments, plus equity participations) may not at any time exceed the total amount of its unimpaired subscribed capital, reserves and surplus included in its ordinary capital resources. As at 31 December 2024, such total outstanding amount was UA 35.05 billion, 6.8 percent higher than in 2023.

In evaluating projects, the Bank considers a wide variety of factors, including the economic, technical and financial feasibility of the project, the effect on the general development activity of the country concerned, the contribution to the removal of impediments to economic development, the capacity of the borrowing country to service additional external debt, and the effect on the balance of payments. Other factors include the effect of new technologies on productivity, and the effect of the project on employment opportunities and the environment. In addition, the Bank considers the ability of the borrower to obtain financing elsewhere on terms and conditions that the Bank considers reasonable. One of the principal functions of the Bank is to direct resources to projects that form part of a national or regional development programme, and which benefit two or more regional member countries, particularly projects designed to stimulate intra-African trade and economic development.

It is the policy of the Board of Directors to consider loans and other financial products only on the basis of written reports prepared by staff of the Bank. These reports set forth detailed information regarding the technical feasibility and economic merits of the project to be financed and relevant financial and legal matters, as well as the economic situation of the country in which the project is located. The process of identifying and appraising a project and of approving and disbursing a project loan often extends over several years. The average time to prepare a project from the project concept note stage to Board of Directors' approval ranges from approximately six to twelve months depending on the complexity of the project. The appraisal of projects is carried out by the Bank's staff, in some cases with the help of external consultants. Loans do not become effective until certain legal requirements are fulfilled by the borrower. The Bank generally requires that borrowers seek competitive bids from potential suppliers, that engineering plans and specifications are drawn up independently of suppliers or manufacturers and, if appropriate, that independent consultants be retained by borrowers. The Bank supervises the disbursements of its loans to ensure that the proceeds are applied only for project expenditures as incurred and are used by the borrower only for the procurement of goods and services required for the project being financed. In order to monitor the effective implementation of projects being financed, the Bank maintains a continuous relationship with the borrower after a loan is made.

The Bank's policy of loan administration and project supervision involves field missions, where necessary, and the submission of progress reports on a regular basis. Subsequent to physical completion, the project is evaluated to determine the extent to which productivity and other goals, such as envisaged contribution towards economic growth and development outcomes, were met. Since loan disbursements are made against project expenditures, the disbursement period frequently extends over five to seven years.

Loans are disbursed in four ways: (1) by reimbursement to borrowers, (2) by direct payment to suppliers for expenses incurred in connection with approved projects, (3) by advances to borrowers of up to 10 percent of a given loan commitment to be accounted for by the borrower, or (4) by the issuance of irrevocable commitments to commercial banks backing their letters of credit to suppliers for shipment of specified goods to borrowers.

Since 1987, the Bank's lending operations have included non-project lending in the form of sector investment and rehabilitation and structural adjustment lending. The Bank's participation in such non-project lending has

generally been in conjunction with other development organisations, including the World Bank.

In 2016, the Bank launched the Industrialization Strategy for Africa 2016–2025 to succeed the Private Sector Development Strategy approved in 2013 for the period 2013-2017. Led by the Private Sector, Infrastructure and Industrialization Complex, the strategy aims to increase the capacity of African firms to compete with imported products in local markets; boost regional trade; support development and expansion of small and medium enterprises and industry clusters. The strategy will pursue six flagship programmes aimed at fostering industrial policies, catalyzing funding in infrastructure and promoting private sector development. They include programmes to catalyze funding in infrastructure and industry projects; expand liquid and effective capital markets; promote and drive enterprise development; promote strategic partnerships; develop efficient industry clusters; and foster successful industrial policies.

Total Bank approvals for non-sovereign operations in 2024 amounted to UA 1.65 billion – an increase of 30 percent from the UA 1.27 billion non-sovereign operations approved in 2023. The total approvals in 2024 comprised loans and grants, equity participation and guarantees for sovereign and non-sovereign operations amounting to UA 5.57 billion in total.

Following the approval by the Board of Directors on 13 May 2014 of a proposal to allow eligible ADF-only countries access to the Bank's sovereign window, several low-income African countries can now secure non-concessionary resources from the Bank for financing viable projects. The new approach allows the Bank to respond proactively to the improved economic conditions in RMC over the past decade and underscores the African Development Bank Group (the "Bank Group")'s recognition of the strong economic progress of African countries during the last decade, and its mandate to help to sustain inclusive growth in countries.

Detailed information on loans approved by the Bank as at 31 December 2024 (excluding fully repaid loans and cancelled loans) are set forth in Note C and Note H to the financial statements included herein.

**Approvals and Disbursements** 

In 2024, the Bank's loan disbursements (excluding equity participation) amounted to UA 3.50 billion. Total loan approvals (excluding special funds and equity participations) by the Bank amounted to UA 5.51 billion in 2024, a 4 percent decrease compared to 2023 approvals of UA 5.74 billion.

**Currency composition of loans** 

The following table sets forth the Bank's outstanding loans by currency as at 31 December 2024 and 2023:

**Gross Outstanding Loans by Currency**

*(Amounts expressed in UA million)*

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| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;**2024** | &nbsp;&nbsp;**2024** | &nbsp;&nbsp;**2023** | &nbsp;&nbsp;**2023** |
|  | &nbsp;&nbsp;**Amount** | &nbsp;&nbsp;**%** | &nbsp;&nbsp;**Amount** | &nbsp;&nbsp;**%** |
| &nbsp;&nbsp;Euro | &nbsp;&nbsp;11251.56 | &nbsp;&nbsp;46.51 | &nbsp;&nbsp;11381.31 | &nbsp;&nbsp;50.03 |
| &nbsp;&nbsp;Japanese Yen | &nbsp;&nbsp;2.01 | &nbsp;&nbsp;0.01 | &nbsp;&nbsp;0.70 | &nbsp;&nbsp;0.00 |
| &nbsp;&nbsp;South African Rand | &nbsp;&nbsp;2107.44 | &nbsp;&nbsp;8.71 | &nbsp;&nbsp;1651.95 | &nbsp;&nbsp;7.26 |
| &nbsp;&nbsp;US Dollar | &nbsp;&nbsp;10830.75 | &nbsp;&nbsp;44.77 | &nbsp;&nbsp;9715.23 | &nbsp;&nbsp;42.71 |
| &nbsp;&nbsp;**Total** | &nbsp;&nbsp;**24191.76** | &nbsp;&nbsp;**100.00** | &nbsp;&nbsp;**22749.18** | &nbsp;&nbsp;**100.00** |

---

**Overdue and Non-Performing Loans**

At each reporting date, the Bank assesses whether there has been a significant increase in credit risk for exposures since initial recognition by comparing the risk of a default occurring over the remaining expected life from the reporting date and the date of initial recognition.

In line with expected credit losses (ECLs) principles, Non-Performing Loans are categorized as credit impaired when events that have a detrimental impact on the estimated future cash flows of that financial instrument have occurred after its initial recognition. For impairment purposes, the Bank recognizes lifetime ECLs for all non-performing financial assets, as a specific provision. Evidence of impairment includes indications that the borrower is experiencing significant financial difficulties, or a default or delinquency has occurred. A default occurs when either or both of the following happens:

- The Bank determines that the obligor is unlikely to pay its credit obligations in full, without recourse by the Bank to actions such as realizing security; or

- The obligor is past due by more than 180 days for sovereign loans and more than 90 days for non-sovereign loans.

Interest revenue is calculated by applying the effective interest rate to the amortized cost (net of the applicable impairment loss provision) for non-performing financial assets. For performing assets, interest revenue is recognized on the gross carrying amount.

A financial asset is no longer considered as impaired when all past due amounts, including interest, have been recovered, and it is determined that the principal and interest are fully collectible in accordance with the original contractual terms or revised market terms of the financial instrument with all criteria for the impaired classification having been remedied.

The Bank has never written off any of its sovereign guaranteed outstanding loans. In line with the status of the Bank and its relationship with its borrowers and guarantors, the Bank expects that each of these loans will ultimately be repaid and, accordingly, has no expectation of writing off outstanding loans in the future. The Bank maintains a continuous dialogue with its borrowers as part of its efforts to ensure prompt payment on all its loans.

**Loan Terms**

Loans are stated at their principal amounts outstanding less any allowance for impairment. Except for private sector development loans, all of the Bank's loans are made to, or guaranteed by, regional member countries. Amounts disbursed on loans are repayable in the currency or currencies disbursed by the Bank or in other freely convertible currency or currencies approved by the Bank. The amount repayable in each of these currencies shall be equal to the amount disbursed in the original currency. Loans are granted for a maximum period of 25 years, including a grace period not exceeding 8 years, which is typically the period of project implementation.

The following table sets forth the maturity structure of disbursed and gross outstanding loans as at 31 December 2024 and 2023:

**Maturity Structure of Gross Loans as at 31 December 2024 and 2023**

(Amounts expressed in UA million)

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Periods | &nbsp;&nbsp;**2024** | &nbsp;&nbsp;**2023** |
| &nbsp;&nbsp;One year or less | &nbsp;&nbsp;2183.83 | &nbsp;&nbsp;2055.82 |
| &nbsp;&nbsp;More than one year but less than two years | &nbsp;&nbsp;1928.39 | &nbsp;&nbsp;1887.45 |
| &nbsp;&nbsp;More than two years but less than three years | &nbsp;&nbsp;2005.91 | &nbsp;&nbsp;1940.26 |
| &nbsp;&nbsp;More than three years but less than four years | &nbsp;&nbsp;2030.05 | &nbsp;&nbsp;1882.90 |
| &nbsp;&nbsp;More than four years but less than five years | &nbsp;&nbsp;1926.00 | &nbsp;&nbsp;1888.08 |
| &nbsp;&nbsp;More than five years | &nbsp;&nbsp;14117.57 | &nbsp;&nbsp;13094.67 |
| &nbsp;&nbsp;**Total** | &nbsp;&nbsp;**24191.76** | &nbsp;&nbsp;**22749.18** |

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**Bor** **rowing Policies**

The Board of Directors has authorised the issuance of two classes of debt, senior debt and subordinated debt. All debt of the Bank is senior debt unless by its terms it is expressly subordinated in right of payment to other debt of the Bank. Both classes rank *pari passu* except in the event of a call by the Bank on its callable capital, whereupon the holders of the subordinated debt of the Bank will be subordinated in right of payment to holders of senior debt.

The Bank's policy limits its debt to usable capital ratio to 100 percent. The Bank has also adopted the working principle that, within the limitations set forth, the actual amount of its senior debt outstanding at any time should be a function of its objective of obtaining and maintaining a rating on its securities at the highest levels from recognised rating agencies. As at 31 December 2024, the amount of total outstanding borrowings of UA 26.40 billion (only senior debt) represented 38.77 percent of the usable capital and 17.20 percent of the total callable capital of UA 153.53 billion of all members of the Bank.

In December 2001, the Bank established the unlimited Global Debt Issuance Facility (GDIF) to replace its Euro-Medium Term Note Programme and US Medium Term Note Programme with respect to its future borrowings. The Bank also has a Euro Commercial Paper (ECP) programme and a USD Commercial Paper (USCP) programme of EUR 2 billion (for the ECP and USCP jointly). The GDIF and the ECP and USCP programmes maximise the Bank's financing flexibility and enable its continuous issuance of notes in the Euro, the US and other domestic markets.

The Bank has entered into arrangements whereby, in the event of a call on its callable capital, it would request its member countries to make payment in response to such a call into a special account established by the Bank with the Federal Reserve Bank of New York, or its successor duly designated for the purpose. The terms of such account provide that the proceeds of a call must first be applied in payment of, or in provision for full settlement of all outstanding obligations of the Bank incurred in connection with the issuance of senior debt before any other payment shall be made with such proceeds.

The weighted average life of the Bank's outstanding borrowings as at 31 December 2024, 2023, 2022 and 2021 was 3.65, 3.28, 4.17 and 4.05 years respectively.

As at 31 December 2024, the Bank's outstanding borrowings were denominated in twenty-seven currencies or currency units.

The table below sets forth the maturity structure of the Bank's outstanding borrowings as at 31 December 2024 and 2023:

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;(Amounts expressed in UA million) – 2024 | &nbsp;&nbsp;**Outstanding Borrowings** | &nbsp;&nbsp;**Outstanding Borrowings** | &nbsp;&nbsp;**Outstanding Borrowings** |
| &nbsp;&nbsp;**Periods** | &nbsp;&nbsp;**At Fair Value** | &nbsp;&nbsp;**At Amortized Cost** | &nbsp;&nbsp;**Total** |
| &nbsp;&nbsp;One year or less | &nbsp;&nbsp;3416.19 | &nbsp;&nbsp;60.19 | &nbsp;&nbsp;3476.38 |
| &nbsp;&nbsp;More than one year but less than two years | &nbsp;&nbsp;6560.62 | &nbsp;&nbsp;17.63 | &nbsp;&nbsp;6578.25 |
| &nbsp;&nbsp;More than two years but less than three years | &nbsp;&nbsp;6530.54 | &nbsp;&nbsp;69.49 | &nbsp;&nbsp;6600.03 |
| &nbsp;&nbsp;More than three years but less than four years | &nbsp;&nbsp;4012.51 | &nbsp;&nbsp;7.82 | &nbsp;&nbsp;4020.33 |
| &nbsp;&nbsp;More than four years but less than five years | &nbsp;&nbsp;3750.87 | &nbsp;&nbsp;8.91 | &nbsp;&nbsp;3759.78 |
| &nbsp;&nbsp;More than five years | &nbsp;&nbsp;1925.28 | &nbsp;&nbsp;44.49 | &nbsp;&nbsp;1969.77 |
| &nbsp;&nbsp;**Sub total** | &nbsp;&nbsp;**26196.01** | &nbsp;&nbsp;**208.53** | &nbsp;&nbsp;**26404.54** |
| &nbsp;&nbsp;Net unamortized premium and discount |  | &nbsp;&nbsp;(0.51) | &nbsp;&nbsp;(0.51) |
| &nbsp;&nbsp;**Total** | &nbsp;&nbsp;**26196.01** | &nbsp;&nbsp;**208.02** | &nbsp;&nbsp;**26404.03** |
| &nbsp;&nbsp;(Amounts expressed in UA million) – 2023 | &nbsp;&nbsp;**Outstanding Borrowings** | &nbsp;&nbsp;**Outstanding Borrowings** | &nbsp;&nbsp;**Outstanding Borrowings** |
| &nbsp;&nbsp;**Periods** | &nbsp;&nbsp;**At Fair Value** | &nbsp;&nbsp;**At Amortized Cost** | &nbsp;&nbsp;**Total** |
| &nbsp;&nbsp;One year or less | &nbsp;&nbsp;3682.58 | &nbsp;&nbsp;106.07 | &nbsp;&nbsp;3788.65 |
| &nbsp;&nbsp;More than one year but less than two years | &nbsp;&nbsp;2765.70 | &nbsp;&nbsp;33.6 | &nbsp;&nbsp;2799.30 |
| &nbsp;&nbsp;More than two years but less than three years | &nbsp;&nbsp;5694.59 | &nbsp;&nbsp;- | &nbsp;&nbsp;5694.59 |
| &nbsp;&nbsp;More than three years but less than four years | &nbsp;&nbsp;5543.04 | &nbsp;&nbsp;74.23 | &nbsp;&nbsp;5617.27 |
| &nbsp;&nbsp;More than four years but less than five years | &nbsp;&nbsp;3442.49 | &nbsp;&nbsp;- | &nbsp;&nbsp;3442.49 |
| &nbsp;&nbsp;More than five years | &nbsp;&nbsp;3434.47 | &nbsp;&nbsp;- | &nbsp;&nbsp;3434.47 |
| &nbsp;&nbsp;**Sub total** | &nbsp;&nbsp;**24562.87** | &nbsp;&nbsp;**213.9** | &nbsp;&nbsp;**24776.77** |
| &nbsp;&nbsp;Net unamortized premium and discount | &nbsp;&nbsp;- | &nbsp;&nbsp;(0.36) | &nbsp;&nbsp;(0.36) |
| &nbsp;&nbsp;**Total** | &nbsp;&nbsp;**24562.87** | &nbsp;&nbsp;**213.54** | &nbsp;&nbsp;**24776.41** |

---

The following table sets forth for the periods indicated the average interest rates on the Bank's loans, the return on its average earning assets, the average cost of its funded debt and other funds available and its interest coverage ratio:

**Selected Financial Ratios** 

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| | | | | |
|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;**2024** | &nbsp;&nbsp;**2023** | &nbsp;&nbsp;**2022** | &nbsp;&nbsp;**2021** |
| &nbsp;&nbsp;Weighted average interest rate on disbursed and outstanding loans for the year (1) | &nbsp;&nbsp;6.05% | &nbsp;&nbsp;5.54% | &nbsp;&nbsp;2.48% | &nbsp;&nbsp;1.66% |
| &nbsp;&nbsp;Weighted average cost of: |  |  |  |  |
| &nbsp;&nbsp;Outstanding borrowings (2) | &nbsp;&nbsp;5.52% | &nbsp;&nbsp;4.89% | &nbsp;&nbsp;1.50% | &nbsp;&nbsp;0.30% |
| &nbsp;&nbsp;Interest coverage ratio (3) | &nbsp;&nbsp;1.25x | &nbsp;&nbsp;1.34x | &nbsp;&nbsp;1.68x | &nbsp;&nbsp;2.36x |
| &nbsp;&nbsp;Bank's target interest coverage ratio | &nbsp;&nbsp;1.25x | &nbsp;&nbsp;1.25x | &nbsp;&nbsp;1.25x | &nbsp;&nbsp;1.25x |

---

(1) Interest accrues only on disbursed and outstanding loan amounts.

(2) The weighted average cost on borrowings excludes the MTM impact

(3) Net income before distribution plus interest expense, divided by interest expense.

**Asset and Liability Management** 

The Bank's Asset and Liability Management ("ALM") activities include all debt funding transactions, investment of liquid resources, managing the currency exposure and operational aspects of the Bank's lending and equity investment operations.

The principal objective of the Bank's ALM operations is to ensure that the Bank is able to provide flexible lending and investment products that meet client needs, while simultaneously reducing exposure to non-core risks such as market risk (interest rate, foreign exchange and liquidity risk), counterparty credit risk and operational risk in line with the Bank's over-arching risk management philosophy.

**Liqui** **d Assets and Liquidity Policy**

The Bank's principal liquidity risk management objective is to hold sufficient liquid resources to enable it to meet all probable cash flow needs for a rolling 1-year horizon without additional financing from the capital markets.

In order to minimize liquidity risk, the Bank maintains a prudential minimum level of liquidity (PML) based on the projected net cash requirement for a rolling 1-year period. The PML is updated quarterly and computed as the sum of four components: (1) 1-year debt service requirements; (2) 1-year projected net loan disbursements (loans disbursed less repayments) if greater than zero; (3) loan equivalent value of signed guarantees; and (4) undisbursed equity investments.

Generally, liquid assets of the Bank are invested in marketable securities issued or guaranteed by the member countries or public entities thereof, supranational, corporate and financial institution obligations, and time deposits. The Bank also has limited exposure to asset and mortgage-backed securities. All marketable securities are valued at market value with the exception of certain investments in debt securities intended to be held to maturity which are carried at amortised cost using the effective interest method.

The Bank's cash and treasury investments (net of repurchase agreements) as at 31 December 2024 totalled UA 15.23 billion, compared to UA 13.77 billion at the end of 2023. Investment income for 2024 amounted to UA 534.49 million or a return of 3.69 percent on an average liquidity level of UA 14.50 billion, compared to an income of UA 459.60 million, or a return of 3.25 percent, on an average liquidity level of UA 14.16 billion in 2023. The increase was driven by higher market interest rates, an increase in the size of the treasury investment portfolio, and additional contributions from the portfolio funded by hybrid capital. Overall, the portfolios at fair value outperformed their benchmark during the year.

The Bank's liquid assets are tranched into three portfolios, namely the operational portfolio, the prudential portfolio, and the equity-backed portfolio, each with a different benchmark that reflects the cash-flow and risk profile of its assets and funding sources. These benchmarks are 1-month SOFR and 1-month EURIBOR[1] for the operational portfolio, while the Prudential Portfolio is indexed against 6-month USD Synthetic LIBOR and 6-month EURIBOR[2]. The operational and prudential portfolios are held for trading. The equity-backed portfolio is managed against a repricing profile benchmark with 10 percent of the Bank's net assets repricing uniformly over a period of 10 years and is held at amortized cost.

[1] JIBID for ZAR, and ISDA LIBOR fallback for GBP, CHF and JPY.

[2] 3-month JIBAR for ZAR and ISDA LIBOR fallback for GBP, CHF and JPY.

**Bank Rating**

The Bank monitors and manages its key financial strength metrics in a stringent manner and is rated by four major rating agencies. The ratings of the Bank's senior debt (AAA/Aaa/AAA/AAA) in 2024 were reaffirmed with a stable outlook by the four leading international rating agencies: Fitch, Moody's, Standard & Poor's and Japan Credit Rating Agency. These high credit ratings reflect the Bank's solid capital adequacy, robust risk management, prudent financial management, high liquidity coverage, excellent funding record, preferred creditor status, and strong shareholder support.

**Equity Participations**

The Bank may invest in equities either directly or indirectly, through appropriate funds and other investment vehicles. The Bank's objective in such equity investments is to promote the economic development of its regional member countries and in particular the development of their private sectors. The Bank's equity participation is also intended to promote the efficient use of resources, promoting African participation, playing a catalytic role in attracting other investors and lenders and mobilizing the flow of domestic and external resources to financially viable projects, which also have significant economic merit.

Unless otherwise approved by the Board of Directors, the Bank's equity participation shall not exceed 25 percent of the equity capital of the entity in which it invests. The Bank therefore does not seek a controlling interest in the companies in which it invests but closely monitors its equity investments through board representation. In accordance with the Board of Governors' Resolution B/BG/2009/10 of 13 May 2009, total equity investment by the Bank shall not at any time exceed 15 percent of the aggregate amount of the Bank's paid-in capital and reserves and surplus (risk capital) included in its ordinary capital resources. The Bank's equity participations at the end of 2024 amounted to UA 1.09 billion.

The Bank has equity participations in, among others, various regional and sub-regional development banks and other public and private sector financial institutions such as the African Export-Import Bank, Africa Finance Corporation, Shelter-Afrique, Eastern and Southern African Trade and Development Bank, and commercial banks as well as in several regional private equity funds.

Under IFRS 9 equity investments must be measured at fair value. However, where the equity investment is not held for trading, an entity has the option to report subsequent fair value changes in other comprehensive income, and the accumulated fair value changes in equity cannot be transferred to the income statement whenever the equity investment is subsequently derecognized. As the Bank's equity investments are usually held for strategic purposes of enhancing development in regional member countries rather than for trading, the Bank elected to designate all its equity investments as at fair value through other comprehensive income.

At reporting period, the fair value of underlying assets of entities in which the Bank has equity investment interests are determined by fund managers or independent valuation experts using standard market practices. The fair value of investments in listed enterprises is based on the latest available quoted bid prices. The fair value of investments in unlisted entities is assessed using appropriate methods, for example, discounted cash flows. The fair value of the Bank's equity participations is measured as the Bank's percentage ownership of the net asset value of the investee funds.

**Special and trust funds**

In addition to its ordinary resources, the Bank administers various special and trust funds for purposes which are consistent with the Bank's objective of promoting the economic development and social progress of its regional member countries. The resources of special and trust funds are required to be held, used, committed, invested or otherwise disposed of entirely separately from the ordinary capital resources of the Bank. The administration of each of these funds is subject to the Bank Agreement and financial regulations, specific rules and regulations, and applicable policies of the Bank. The Bank typically receives an administrative fee for managing these funds.

The Bank also manages the NTF, which supplement the activities of the Bank. In addition, the Bank has been entrusted with the administration of grant funds on behalf of donors, including member countries, agencies and other entities. Grant resources are restricted for specific uses which include the co-financing of Bank lending projects, and technical assistance for borrowers including feasibility studies, project preparation and capacity building. Details of these funds are disclosed in Notes V-3, V-4 and V-5 to the financial statements included herein.

**African Development Fund**

The ADF was established in 1972 pursuant to an agreement between the Bank and 15 non-regional members (the "ADF Agreement") to provide loans on concessionary terms to the RMC. The ADF and all of its resources are separate and entirely independent from those of the Bank. The Bank assumes no liability for any of the obligations of the ADF.

The ADF Agreement designates a Board of Governors (the "ADF Board of Governors") as the ADF's highest policy

making organ. The ADF Board of Governors meets at least once annually. The ADF Board of Directors, which includes seven non-regional members nominated by their constituencies and seven executive directors representing the AfDB, is responsible for overseeing the general operations of the ADF.

The ADF uses the UA as the measure of the subscription of its participants and of its loans and for statistical and financial reporting purposes. Following amendment of the ADF Agreement, the UA of the ADF has been aligned with the UA of the Bank with effect from 1 January 1993.

The purpose of the ADF is to assist the Bank in making an effective contribution to the economic progress and social development of the regional member countries and to promote cooperation among them. The operations of the ADF supplement those of the Bank. In contrast to the lending policy of the Bank, the ADF provides long-term financing for projects on concessionary terms. The ADF's loan financing is directed primarily at those RMC which are in the greatest need of such financing.

The resources of the ADF primarily consist of subscriptions by the Bank, subscriptions and contributions by ADF State Participants, as well as other resources received by the ADF.

ADF has continued to receive additional resources mostly from its State Participants in the form of periodic general replenishments, typically conducted every three years. The two most recent are the Fifteenth Replenishment of the ADF ("ADF-15") and the Sixteenth Replenishment of the ADF ("ADF-16"). ADF-15 became effective on 30 June 2020, following its adoption by the ADF Board of Governors on 14 May 2020. State Participants agreed on an ADF-15 resource level of UA 5.62 billion covering the operational period of 2020-2022 and comprised of: (i) Donor subscriptions of UA 3.55 billion; (ii) Concessional Donor Loans of UA 710.76 million (including the grant element of concessional donor loans); and (iii) Advanced Commitment Capacity of UA 1.36 billion. Three Regional Member Countries – Angola, Egypt, and South Africa – also pledged and subscribed to ADF-15. At the end of the ADF-15 cycle, a total of UA 3.72 billion (including the grant element of CDLs and excluding the buy down grant) in instruments of subscription (IoS) had been received as subscriptions to this replenishment.

ADF-16 became effective on 8 June 2023, following its adoption by the ADF Board of Governors on 2 April 2023. State Participants agreed on an ADF-16 resource level of UA 6.208 billion (subsequently revised to UA 6.192 billion in 2023), covering the operational period of 2023-2025 and comprised of: (i) Donor subscriptions of UA 3,746.95 million; (ii) Concessional Donor Loans of UA 427.40 million (including the grant element of concessional donor loans); and (iii) Advanced Commitment Capacity of UA 2.018 billion. Six Regional Member Countries – Algeria, Angola, Democratic Republic of Congo, Egypt, Morocco and South Africa – also pledged. In 2023, the Fund received additional subscriptions to this replenishment increasing its resource envelope to UA 6.230 billion. As of 31 December 2024, the Fund received UA 3.757 billion in subscriptions to ADF-16. This amount includes the grant element of concessional donor loans. An additional amount of UA 81.40 million was provided as buy down grant to ADF-16 increasing total subscriptions to UA 3.839 billion.

In addition to core contributions to ADF-16, a Climate Action Window for an amount of UA 312.64 million was introduced and included in the ADF-16 Financing Framework. Germany, the Netherlands, Switzerland and the UK have pledged and subscribed to provide seed money to this Window. By 31 December 2024, the Fund had received UA 76.91 million as payment to the Climate Action Window.

The cumulative subscriptions to the ADF amounted to UA 37.96 billion as at 31 December 2024. ADF approvals stood at UA 1.82 billion, representing an increase of 42.2 percent against 2023.

Loans and grants disbursed under ADF decreased slightly by 1.5 percent to stand at UA 1.10 billion in 2024 from UA 1.12 billion in 2023. As at 31 December 2024, cumulative disbursements on loans and grants amounted to UA 33.24 billion compared to UA 32.34 billion at the end of 2023. A total of 2,707 loans and grants were fully disbursed for an amount of UA 27.72 billion, representing 83.39 percent of cumulative disbursements.

Loans are generally granted under conditions that allow for repayment up to 40 years after a 10-year grace period commencing from the date of the loan agreement. Loan principal is generally repayable from years 11 through 20 at a rate of 2 percent per annum and from years 21 through 40 at a rate of 4 percent per annum. A service charge at a rate of 0.75 percent per annum on the principal amount disbursed and outstanding is payable by the borrower semi-annually. Loans approved after June 1996 carry a 0.5 percent per annum commitment charge on the undisbursed portion. Such commitment charge commences to accrue after 120 days from the date of signature of the loan agreement. With effect from the Twelfth Replenishment of the ADF, loans to blend, gap and graduating countries carry differentiated financing terms of thirty (30) years' maturity, including a grace period of 5 years and interest rate of 1 percent, in addition to the existing standard 0.50 percent commitment fee and 0.75 percent service charge. Under the Thirteenth Replenishment of the ADF, further differentiated lending terms were adopted with a view to preserving the long-term financial sustainability and capacity of the ADF. The new lending terms require the acceleration of loan repayment by regular and advanced ADF-only countries, and also to blend, gap and graduating countries. They also grant financial incentives for voluntary loan repayment.

**Nigeria Tru** **st Fund**

The Agreement Establishing the Nigeria Trust Fund Agreement (the "NTF Agreement") was signed on 26 February 1976, between the Bank and the Federal Republic of Nigeria and became effective on 25 April 1976. Following the initial expiry of the agreement, and the successful completion of independent reviews of its performance, the NTF Agreement has been extended several times, most recently for five years effective from 25 April 2023. The purpose of the NTF is to assist in the economic development of the neediest RMC by providing funds on terms intermediate between those of the Bank and those of the ADF. The resources of the NTF are managed by the Bank on behalf of the Government of Nigeria. The purpose of the NTF is to enable Nigeria to make an increasingly effective contribution to the economic development and social progress of Africa, especially of those member countries of the Bank which are relatively less developed. NTF loans currently bear an interest rate of between 2 and 4 percent, a repayment period of up to 25 years including a grace period of up to five years prior to the commencement of principal repayments and a commission of 0.75 percent payable on undisbursed balances. The resources of the NTF come from contributions from the Federal Republic of Nigeria and the net income of the NTF.

In April 2003, the AfDB Board of Directors endorsed the Initiatives to Enhance the Development Effectiveness of the NTF. The enhancements subsequently approved by the Board of Governors include: (i) participation in the Heavily Indebted Poor Countries ("HIPC") debt relief initiative by contributing 10 percent of the annual net income of the NTF to the HIPC Trust Fund; (ii) an adjustment of the interest rate for NTF loans from 4 percent to a range of 2 to 4 percent to increase the concessionality of such loans; (iii) the execution of a Technical Cooperation Agreement with the Bank Group for the purposes of providing resources for the financing of technical and institutional support programmes for the benefit of RMC; and (iv) the introduction of greater flexibility in the investment of the resources of the NTF, pending their use in financing projects.

As at 31 December 2024, the NTF had total assets of UA 214.56 million.

**Litigation**

The Bank is not a party to any material litigation.

 **ADMINISTRATION OF THE BANK**

**Board of Governors**

All the powers of the Bank are vested in the Board of Governors, which consists of a Governor and an Alternate Governor appointed by each member of the Bank, who exercises the voting power to which that member country is entitled. Each Governor and Alternate Governor serves for a term of five years, subject to termination of appointment or to reappointment at any time at the discretion of the appointing member country.

The Board of Governors may delegate to the Board of Directors all its powers except certain specified powers, such as the power to increase or decrease the authorised capital and to approve, after reviewing the report of the auditors, the balance sheet and statement of income and expenses of the Bank.

The Board of Governors holds an annual meeting, and such other meetings as may be provided for the Board of Governors or called by the Board of Directors. Meetings of the Board of Governors are called by the Board of Directors whenever requested by five members of the Bank, or by members having one quarter of the total voting power.

**Board of Di** **rectors**

Without prejudice to the powers of the Board of Governors, the Board of Directors is responsible for the conduct of the general operations of the Bank, and, for this purpose, exercises all the powers delegated to it by the Board of Governors. Prior to 28 May 2010, the Board of Directors was composed of eighteen members twelve of whom are elected by the Governors representing RMC, and six by the Governors representing non-regional member countries. On 28 May 2010, the Board of Governors increased the membership of the Board of Directors from eighteen to twenty. Thirteen members represent regional member countries and seven represent non-regional member countries.

Each Director appoints an Alternate Director who acts in his/her absence. Directors and their Alternates are required to be nationals of member countries. An Alternate Director may participate in meetings of the Board of Directors but may vote only when acting in place of the absent Director.

Directors are elected for a term of three years and may be re-elected provided that no Director shall serve for more than two three-year terms. Members of the Board of Directors as at 31 December 2024 are listed below.

**Board of Di** **rectors – Countries Represented as at 31 December 2024**

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Executive Director** | &nbsp;&nbsp;**For** |
| &nbsp;&nbsp;Brahim BOUZEBOUDJEN | &nbsp;&nbsp;Algeria |
| &nbsp;&nbsp;Alfredo Paulo MENDES (Alternate) | &nbsp;&nbsp;Guinea Bissau |
|  | &nbsp;&nbsp;Madagascar |
| &nbsp;&nbsp;Gerard Pascal BUSSIER | &nbsp;&nbsp;Mauritius |
| &nbsp;&nbsp;Shebo NALISHEBO (Alternate) | &nbsp;&nbsp;Zambia |
|  | &nbsp;&nbsp;Botswana |
|  | &nbsp;&nbsp;Malawi |
| &nbsp;&nbsp;Abdulhakim Mohamed ELMISURATI | &nbsp;&nbsp;Libya |
| &nbsp;&nbsp;Mohamed M. HAMMA KHATTAR (Alternate) | &nbsp;&nbsp;Mauritania |
|  | &nbsp;&nbsp;Somalia |
| &nbsp;&nbsp;Rufus N. DARKORTEY | &nbsp;&nbsp;Liberia |
| &nbsp;&nbsp;Elsiddig Mohamed Elobaid RAHMA (Alternate) | &nbsp;&nbsp;Sudan |
|  | &nbsp;&nbsp;Ghana |
|  | &nbsp;&nbsp;Sierra Leone |
|  | &nbsp;&nbsp;The Gambia |
| &nbsp;&nbsp;Nomfundo Xenia NGWENYA | &nbsp;&nbsp;South Africa |
| &nbsp;&nbsp;Ephraem Vusie DLAMINI (Alternate) | &nbsp;&nbsp;Eswatini |
|  | &nbsp;&nbsp;Lesotho |
| &nbsp;&nbsp;Khaled A.F.M. Sherif | &nbsp;&nbsp;Egypt |
| &nbsp;&nbsp;Ali MOHAMED ALI (Alternate) | &nbsp;&nbsp;Djibouti |
| &nbsp;&nbsp;Malika DHIF | &nbsp;&nbsp;Morocco |
| &nbsp;&nbsp;Yandja YENTCHABRE (Alternate) | &nbsp;&nbsp;Togo |

---

---

| | |
|:---|:---|
|  | &nbsp;&nbsp;Tunisia |
| &nbsp;&nbsp;Adama KONE | &nbsp;&nbsp;Côte d'Ivoire |
| &nbsp;&nbsp;Diosdado Edu Mongomo AVORO (Alternate) | &nbsp;&nbsp;Equatorial Guinea |
|  | &nbsp;&nbsp;Guinea |
| &nbsp;&nbsp;Chantal Modeste NONAULT | &nbsp;&nbsp;Congo |
| &nbsp;&nbsp;Dorothy TATAW AWUJONG EPSE BEKOLO (Alternate) | &nbsp;&nbsp;Cameroon |
|  | &nbsp;&nbsp;Burundi |
|  | &nbsp;&nbsp;Central African Republic |
|  | &nbsp;&nbsp;Congo |
|  | &nbsp;&nbsp;Democratic Republic of Congo |
| &nbsp;&nbsp;Desiré GUEDON | &nbsp;&nbsp;Gabon |
| &nbsp;&nbsp;Mouigni Daho SAANDI (Alternate) | &nbsp;&nbsp;Comoros |
|  | &nbsp;&nbsp;Benin |
|  | &nbsp;&nbsp;Burkina Faso |
|  | &nbsp;&nbsp;Cabo Verde |
|  | &nbsp;&nbsp;Chad |
|  | &nbsp;&nbsp;Mali |
|  | &nbsp;&nbsp;Niger |
|  | &nbsp;&nbsp;Senegal |
| &nbsp;&nbsp;Joao Luis NGIMBI | &nbsp;&nbsp;Angola |
| &nbsp;&nbsp;Eugenio Maria PAULO (Alternate) | &nbsp;&nbsp;Mozambique |
|  | &nbsp;&nbsp;Namibia |
|  | &nbsp;&nbsp;Zimbabwe |
| &nbsp;&nbsp;Samson Oyebode OYETUNDE | &nbsp;&nbsp;Nigeria |
| &nbsp;&nbsp;Maria Das Neves CEITA BATISTA DE SOUSA (Alternate) | &nbsp;&nbsp;São Tome & Principe |
| &nbsp;&nbsp;Jonathan NZAYIKORERA | &nbsp;&nbsp;Rwanda |
| &nbsp;&nbsp;Riched Mohamed BADE (Alternate) | &nbsp;&nbsp;Tanzania |
|  | &nbsp;&nbsp;Eritrea |
|  | &nbsp;&nbsp;Ethiopia |
|  | &nbsp;&nbsp;Kenya |
|  | &nbsp;&nbsp;Seychelles |
|  | &nbsp;&nbsp;Uganda |
| &nbsp;&nbsp;Alvaro Nadal BELDA | &nbsp;&nbsp;Spain |
| &nbsp;&nbsp;Tim CAP (Alternate) | &nbsp;&nbsp;Belgium |
|  | &nbsp;&nbsp;France |
| &nbsp;&nbsp;Vacant | &nbsp;&nbsp;United States of America |
| &nbsp;&nbsp;Alex SEVERENS (Alternate) |  |
| &nbsp;&nbsp;Takaaki NOMOTO | &nbsp;&nbsp;Japan |
| &nbsp;&nbsp;Azzam ALBARRAK (Alternate) | &nbsp;&nbsp;Saudi Arabia |
|  | &nbsp;&nbsp;Argentina |
|  | &nbsp;&nbsp;Austria |
|  | &nbsp;&nbsp;Brazil |
| &nbsp;&nbsp;Martin KIPPING | &nbsp;&nbsp;Germany |
| &nbsp;&nbsp;Vacant (Alternate) | &nbsp;&nbsp;Portugal |
|  | &nbsp;&nbsp;Switzerland |
| &nbsp;&nbsp;Edmond Dejon WEGA | &nbsp;&nbsp;Canada |
| &nbsp;&nbsp;Ayad ALGHARABALLI (Alternate) | &nbsp;&nbsp;Kuwait |
|  | &nbsp;&nbsp;China |
|  | &nbsp;&nbsp;Korea |
|  | &nbsp;&nbsp;Türkiye |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;Mette KNUDSEN | &nbsp;&nbsp;Denmark |
| &nbsp;&nbsp;Vacant (Alternate) | &nbsp;&nbsp;Finland |
|  | &nbsp;&nbsp;India |
|  | &nbsp;&nbsp;Norway |
|  | &nbsp;&nbsp;Sweden |
| &nbsp;&nbsp;Domenico Giuseppe FANIZZA | &nbsp;&nbsp;Italy |
| &nbsp;&nbsp;Robert Jan SIEBEN (Alternate) | &nbsp;&nbsp;Netherlands |
|  | &nbsp;&nbsp;United Kingdom |

---

**P** **resident and Management**

The Board of Governors elects the President of the Bank by a vote of a majority of the total voting power of the members, including a majority of the total voting power of the regional member countries. The Bank Agreement provides that the President shall be a national of a regional member country. The President is the chief executive officer of the Bank and conducts the current business of the Bank under the direction of the Board of Directors. The President is elected for a term of five years and may be re-elected provided that no person may be elected President for more than two successive five-year terms.

The President is the Chairman of the Board of Directors but has no vote except a deciding vote in case of a tie. The President may participate in meetings of the Board of Governors but has no vote. The President is the legal representative of the Bank.

The Principal Officers of the Bank as at 31 December 2024 are listed below.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**PRESIDENCY, UNITS REPORTING TO THE PRESIDENT AND THE BOARDS** | &nbsp;&nbsp;**PRESIDENCY, UNITS REPORTING TO THE PRESIDENT AND THE BOARDS** | &nbsp;&nbsp;**PRESIDENCY, UNITS REPORTING TO THE PRESIDENT AND THE BOARDS** |
| &nbsp;&nbsp;President | &nbsp;&nbsp;Akinwumi Ayodeji ADESINA | &nbsp;&nbsp;PRST |
| &nbsp;&nbsp;Director General, Cabinet Office of the President | &nbsp;&nbsp;Alex MUBIRU | &nbsp;&nbsp;PRST |
| &nbsp;&nbsp;Secretary General | &nbsp;&nbsp;Vincent Obisienunwo Orlu NMEHIELLE | &nbsp;&nbsp;PSEG |
| &nbsp;&nbsp;Group Chief Risk Officer | &nbsp;&nbsp;Ifedayo ORIMOLOYE | &nbsp;&nbsp;PGRF |
| &nbsp;&nbsp;General Counsel and Director of the Legal Services Department | &nbsp;&nbsp;Souley AMADOU | &nbsp;&nbsp;PGCL |
| &nbsp;&nbsp;Auditor General | &nbsp;&nbsp;Maurice James GODDARD | &nbsp;&nbsp;PAGL |
| &nbsp;&nbsp;Director, Integrity & Anti-Corruption | &nbsp;&nbsp;Paula SANTOS DA COSTA | &nbsp;&nbsp;PIAC |
| &nbsp;&nbsp;Director, Independent Recourse Mechanism (acting) | &nbsp;&nbsp;Mariam DIAWARA | &nbsp;&nbsp;BCRM |
| &nbsp;&nbsp;Evaluator General | &nbsp;&nbsp;Karen ROT-MUNSTERMANN | &nbsp;&nbsp;BDEV |
| &nbsp;&nbsp;**SENIOR VICE PRESIDENCY** |  |  |
| &nbsp;&nbsp;Senior Vice President | &nbsp;&nbsp;Marie-Laure AKIN-OLUGBADE | &nbsp;&nbsp;SNVP |
| &nbsp;&nbsp;**ECONOMIC GOVERNANCE AND KNOWLEDGE MANAGEMENT** | &nbsp;&nbsp;**ECONOMIC GOVERNANCE AND KNOWLEDGE MANAGEMENT** |  |
| &nbsp;&nbsp;Chief Economist and Vice President, Economic Governance and Knowledge Management | &nbsp;&nbsp;Kevin Chika URAMA | &nbsp;&nbsp;ECVP |
| &nbsp;&nbsp;**PEOPLE & TALENT MANAGEMENT** |  |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Jacques EDJANGUE | &nbsp;&nbsp;PTVP |
| &nbsp;&nbsp;**TECHNOLOGY & CORPORATE SERVICES** |  |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Simon MIZRAHI | &nbsp;&nbsp;TCVP |
| &nbsp;&nbsp;**FINANCE** |  |  |
| &nbsp;&nbsp;Chief Financial Officer and Vice President | &nbsp;&nbsp;Hassatou DIOP N'SELE | &nbsp;&nbsp;FIVP |
| &nbsp;&nbsp;**REGIONAL DEVELOPMENT, INTEGRATION, AND BUSINESS DELIVERY** | &nbsp;&nbsp;**REGIONAL DEVELOPMENT, INTEGRATION, AND BUSINESS DELIVERY** |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Nnenna Lily NWABUFO | &nbsp;&nbsp;RDVP |
| &nbsp;&nbsp;Director General, Central Africa | &nbsp;&nbsp;Serge N'GUESSAN | &nbsp;&nbsp;RDGC |
| &nbsp;&nbsp;Director General, East Africa | &nbsp;&nbsp;Kennedy Kaziputalimba MBEKEANI | &nbsp;&nbsp;RDGE |
| &nbsp;&nbsp;Director General, North Africa | &nbsp;&nbsp;Mohamed EL AZIZI | &nbsp;&nbsp;RDGN |
| &nbsp;&nbsp;Director General, Southern Africa | &nbsp;&nbsp;Leila MOKADDEM | &nbsp;&nbsp;RDGS |
| &nbsp;&nbsp;Director General, West Africa | &nbsp;&nbsp;Lamin Gorgui BARROW | &nbsp;&nbsp;RDGW |
| &nbsp;&nbsp;Director General, Nigeria Country | &nbsp;&nbsp;Abdul KAMARA | &nbsp;&nbsp;RDNG |
| &nbsp;&nbsp;**POWER, ENERGY, CLIMATE AND GREEN GROWTH** |  |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Kevin Kanina KARIUKI | &nbsp;&nbsp;PEVP |
| &nbsp;&nbsp;**AGRICULTURE, HUMAN AND SOCIAL DEVELOPMENT** |  |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Beth DUNFORD | &nbsp;&nbsp;AHVP |
| &nbsp;&nbsp;**PRIVATE SECTOR, INFRASTRUCTURE AND INDUSTRIALIZATION** |  |  |
| &nbsp;&nbsp;Vice President | &nbsp;&nbsp;Solomon QUAYNOR | &nbsp;&nbsp;PIVP |

---

 **THE AGREEMENT ESTABLISHING THE AFRICAN DEVELOPMENT BANK**

The Bank Agreement constitutes the Bank's governing charter and establishes the status, immunities, exemptions and privileges of the Bank, describes its purpose, membership, capital structure and organisation, authorises the kinds of transactions in which it may engage and prescribes limitations on such transactions. The Bank Agreement also includes provisions with respect to the admission of additional members, the increase of the authorised capital stock, the terms and conditions under which the Bank may make or guarantee loans, the use of currencies held by it, the withdrawal and suspension of member countries and the suspension and termination of the operations of the Bank.

The Bank Agreement may be amended only by a resolution of the Bank's Board of Governors approved by a two-thirds majority of the total number of Governors representing not less than three-quarters of the total voting power of the member countries, including two-thirds of the regional members having three-quarters of the total voting power of the regional members. The unanimous agreement of the Board of Governors is required for the approval of any amendment modifying the right to withdraw from the Bank, the pre-emptive rights to subscribe capital stock or the limitation on the liability of the member countries. No such amendment has been made to the Bank Agreement to date. The Bank Agreement provides that any question of interpretation of its provisions arising between any member country and the Bank or between member countries shall be referred to the Board of Directors for decision. Such decision may then be referred to the Board of Governors whose decision shall be final.

**Membership of the Bank**

Any African country that has the status of an independent state may become a regional member of the Bank. The geographical area to which the regional membership and the development activities of the Bank extend consists of the continent of Africa and the African islands. Non-regional countries that are, or become, participants in the ADF or that have made, or are making, contributions to the ADF may be admitted to the Bank.

Although any member may withdraw from the Bank by delivering written notice, any such member remains liable for all direct and contingent obligations to the Bank (including its obligations in respect of callable capital) so long as any part of the loans or guarantees contracted before the termination date is outstanding. No member has withdrawn from the Bank since its establishment. However, membership of the former Yugoslavia was suspended by the Bank's Board of Directors, in conformity with resolutions and determinations of the UN General Assembly (see Note M to the financial statements included herein).

**Legal Status, Immunities and Privileges**

The following is a summary of the principal provisions of the Bank Agreement relating to the legal status, immunities and privileges of the Bank in the territories of its members.

The Bank has full juridical personality with capacity to contract, to acquire and dispose of immovable and movable property, and to institute legal proceedings. It is immune from every form of legal process, except in cases arising out of the exercise of its borrowing powers when it may be sued only in a court of competent jurisdiction in the territory of a member in which it has its principal office, or in the territory of a member or non-member where it has appointed an agent for the purpose of accepting service or notice of process or has issued or guaranteed securities. No actions against the Bank may be brought by members or persons acting for or deriving claims from members.

The property and assets of the Bank are immune from all forms of seizure, attachment or execution before the delivery of final judgment against the Bank. Such property and assets are also immune from search, requisition, confiscation, expropriation or any other form of taking or foreclosure by executive or legislative action. The archives of the Bank are inviolable. The Governors, Directors, Alternate Directors, officers and employees of the Bank and experts and consultants performing missions for the Bank are immune from legal process with respect to acts performed by them in their official capacity. The Bank Agreement enables the Board of Directors to waive any of these immunities where in its opinion it would further the interest of the Bank to do so.

The Bank, its property, other assets, income and the operations and transactions it carries out pursuant to the Bank Agreement are exempt from all taxation and from all customs duties in the member states. The Bank is also exempt from any other obligation relating to the payment, withholding or collection of any tax or duty.

 **GENERAL DESCRIPTION OF THE SECURITIES**

Each prospectus, offering circular, information memorandum, supplemental information statement or pricing supplement will include the following information regarding the terms of Offered Securities: (a) the aggregate principal amount, (b) status (and subordination, in the case of subordinated securities), (c) the maturity date (if any), (d) the interest rate, (e) the currency or currencies, including composite currencies, of denomination and payment, (f) the dates on which such interest will be payable, (g) the redemption dates and prices and provisions for a sinking fund, if applicable, (h) the form and denomination and (i) if applicable, the fiscal or paying agent or agents with respect to the Securities.

Securities will be repayable from the ordinary capital resources of the Bank. The Board of Directors of the Bank has authorised the issuance of two classes of debt securities, senior ("Senior Securities") and subordinated ("Subordinated Securities"). All debt securities of the Bank are Senior Securities unless by their terms they are expressly subordinated in right of payment to other debt securities of the Bank. Both classes of debt securities rank *pari passu* except in the event of a call on the callable capital of the Bank, whereupon the holders of Subordinated Securities of the Bank will be subordinated in right of payment to holders of debt which is not expressly so subordinated, in each case subject as may otherwise be set out in any prospectus, offering circular, information memorandum, supplemental information statement or pricing supplement.

The Securities will not be the obligation of any government, and their terms and conditions will contain a statement to that effect. The specific terms and conditions of each issue of Offered Securities will be set forth or referred to in the prospectus, offering circular or supplemental information statement relating to the Offered Securities.

The Securities will not contain any limitations on the right of the Bank to issue any other bonds, notes or obligations.

**TAXATION**

The Securities and the interest on them generally will not be exempt from taxation.

Under the Bank Agreement, the Securities and the interest paid on them are not subject to any tax by a member of the Bank (i) which discriminates against the Securities solely because they are issued by the Bank or (ii) if the sole jurisdictional basis for the tax is the place or currency in which the Securities are issued, made payable or paid, or the location of any office or place of business maintained by the Bank. Also, under the Bank Agreement, the Bank is not under any obligation to withhold or pay any taxes on any interest on the Securities it issues.

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INDEPENDENT AUDITOR'S REPORT REGARDING THE EFFECTIVENESS OF INTERNAL CONTROL OVER FINANCIAL REPORTING<br>

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![](image_006.jpg)

 **FINANCIAL HIGHLIGHTS FOR THE YEARS ENDED 2024, 2023 AND 2022**

**Net Operational Income**

 

Net operational income is comprised of the net interest income on earning assets, the provision for credit losses on loan and investment losses, the changes in fair value of borrowings, investments and derivatives, translation gains and losses and other income. The table below shows the breakdown of the net operational income for the year ended three years.

---

| | | | |
|:---|:---|:---|:---|
| *<u>(In UA million)</u>* | **2024** | **2023** | **2022** |
| Income from loans | 1419.01 | 1223.55 | 521.57 |
| Interest income from investments and related derivatives | 534.49 | 459.60 | 218.16 |
| Equity investments (Dividends) | 20.22 | 20.48 | 14.19 |
| Income from other debt securities | 11.69 | 7.94 | 6.89 |
| **Total Income from Loans and Treasury Investments** | **1985.41** | **1711.57** | **760.81** |
| Borrowing expenses | (1402.74) | (1191.71) | (353.99) |
| Gains/(losses) on borrowings at fair value and related derivatives | (7.81) | 59.48 | 88.90 |
| Impairment charge on loans and other financial instruments | 5.48 | (19.75) | (96.12) |
| Impairment write-back/(charge) on equity accounted investments | (0.28) | 0.68 | 1.53 |
| Currency Translation gains/(losses) | (1.27) | (10.98) | 66.46 |
| Other income | 20.01 | 18.32 | 13.99 |
| **Net Operational Income** | **598.81** | **567.61** | **481.57** |

---

 

*FY 2024 vs. FY 2023*

Loan income and related derivatives increased by UA 195.46 million to UA 1.42 billion in 2024 from UA 1.22 billion in 2023, due to the increase in the volume of the outstanding loan portfolio during the year. Income from treasury investments and related derivatives increased to UA 534.49 million in 2024 from UA 459.60 million in 2023, mainly as a result of the higher volume of treasury investments during the year.

Borrowing expenses increased to UA 1.40 billion in 2024 from UA 1.19 billion in 2023, mainly attributable to the increase in the volume of outstanding borrowings during the year. The average interest expense on borrowings increased to 5.52 percent in 2024 from 4.89 percent in 2023.

 

*FY 2023 vs. FY 2022*

Loan income and related derivatives increased by UA 701.98 million to UA 1.22 billion in 2023 from UA 521.57 million in 2022, due to the higher interest rate environment over the year and increase in the size of the outstanding loan portfolio. Income from treasury investments and related derivatives increased to UA 459.60 million in 2023 from UA 218.16 million in 2022, mainly as a result of higher interest rates in the markets, albeit largely offset by higher funding costs.

Borrowing expenses increased to UA 1.19 billion in 2023 from UA 353.99 million in 2022, due to the higher interest rate environment. The average interest expense on borrowings increased to 4.89 percent in 2023 from 1.47 percent in 2022.

**Non-interest expenses**

Non-interest expenses include the administrative expenses, provisions for the depreciation of property, equipment, intangible assets and other sundry expenses. Total administrative expenses relate to the expenses incurred on behalf of the ADF, the NTF and for the operations of the Bank itself. The ADF and NTF reimburse the Bank for their share of the total administrative expenses, based on an agreed-upon cost-sharing formula driven primarily by the staff time spent on individual entity's work program deliverables. The table below shows the breakdown of the net non-interest expenses for the last three years.

---

| | | | |
|:---|:---|:---|:---|
| *<u>(In UA Million)</u>* | **2024** | **2023** | **2022** |
| Personnel Expenses | 384.73 | 223.97 | 386.79 |
| Other expenses | 79.93 | 82.71 | 67.09 |
| **Total Administrative Expenses** | **464.66** | **306.68** | **453.88** |
| Reimbursable by ADF | (256.15) | (172.33) | (246.21) |
| Reimbursable by NTF | (0.82) | (1.24) | (0.51) |
| **Net Administrative Expenses** | **207.69** | **133.12** | **207.16** |
| Depreciation – Property, equipment and intangible assets | 34.84 | 28.09 | 29.09 |
| Sundry expenses | 1.87 | 0.36 | 6.04 |
| **Net non-interest expense** | **244.40** | **161.57** | **242.29** |

---

*FY 2024 vs. FY 2023*

 

Net non-interest expenses, which mainly consist of personnel and other administrative expenses, increased to UA 244.40 million in 2024 from UA 161.57 million in 2023. Total Bank Group administrative expenses increased to UA 464.66 million in 2024 from UA 306.68 million in 2023. Total manpower expenses increased by UA 160.76 million (or 71.77 percent) to UA 384.73 million in 2024 from UA 223.97 million in 2023. Other administrative expenses decreased by 3.36 percent to UA 79.93 million in 2024 from UA 82.71 million in 2023, mainly due to cost efficiencies gained from reduced bank business meeting expenses. The Bank's share of the total administrative expenses increased by UA 74.57 million, or 56.01 percent, to UA 207.69 million in 2024 from UA 133.12 million in 2023.

*FY 2023 vs. FY 2022*

 

Net non-interest expenses, which mainly consist of personnel and other administrative expenses, decreased to UA 161.57 million in 2023 from UA 242.29 million in 2022. Total Bank Group administrative expenses decreased to UA 306.68 million in 2023 from UA 453.88 million in 2022. Total manpower expenses decreased by UA 162.83 million (or 42.1 percent) to UA 223.97 million in 2023 from UA 386.79 million in 2022. Other administrative expenses increased by 23.3 percent to UA 82.71 million in 2023 from UA 67.09 million in 2022, stemming from the Return to Office directive. The Bank's share of the total administrative expenses decreased by UA 74.05 million, or 35.7 percent, to UA 133.12 million in 2023 from UA 207.16 million in 2022.

**Financial Condition**

The Bank's total equity increased by 13.15 percent to UA 12.24 billion in 2024 from UA 10.81 billion in 2023 primarily due to capital subscriptions receipts, proceeds from the hybrid capital and total comprehensive income recorded during the year. Reserves increased by 6.76 percent to UA 4,825.76 million in 2024 from UA 4,014.34 million in 2023 driven by the net effect of total comprehensive income and movements in retained earnings.

**INDEPENDENT AUDITOR'S REPORT FOR 31 DECEMBER 2024 AND AfDB FINANCIAL STATEMENTS FOR THE YEARS ENDED 31 DECEMBER 2024 AND 2023**

**T** **ABLE OF CONTENTS**

---

| | |
|:---|:---|
| [Independent Auditor's Report on the Financial Statements](#p36) | [36](#p36) |
| [Balance sheet – Assets](#p44a) | [43](#p44a) |
| [Balance sheet – Liabilities and Equity](#p_43) | [43](#p_43) |
| [Income statement](#p_44) | [44](#p_44) |
| [Statement of comprehensive income](#P44b) | [44](#P44b) |
| [Statement of changes in equity](#P45) | [45](#P45) |
| [Statement of cash flows](#P46) | [46](#P46) |
| [Notes to the Financial Statements](#P47) | [47](#P47) |

---

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![](image_013.jpg)

**BALANCE SHEET AS AT 31 DECEMBER 2024**

*(UA thousands)*

---

| | | | |
|:---|:---|:---|:---|
| **ASSETS** |  | **2024** | **2023** |
| CASH and DUE FROM BANKS (Note E) |  | 859306 | 1383149 |
| DEMAND OBLIGATIONS |  | 1146 | 1146 |
| TREASURY INVESTMENTS (Note F) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury Investments at Fair value | 4899390 |  | 4481799 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury Investments at Amortized cost | 9471952 |  | 7900861 |
|  |  | 14371342 | 12382660 |
| DERIVATIVE ASSETS (Note G) |  | 863319 | 895351 |
| ACCOUNTS RECEIVABLE (Note H) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued Income and Charges receivable on loans | 755654 |  | 641739 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Accounts Receivable | 892607 |  | 1188638 |
|  |  | 1648261 | 1830377 |
| DEVELOPMENT FINANCING ACTIVITIES |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net (Note C & H) | 23691207 |  | 22021408 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Hedged Loans—Fair value adjustment (Note G) | (217548) |  | (278757) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity participations (Note I) | 1090631 |  | 1119073 |
|  |  | 24564290 | 22861724 |
| OTHER ASSETS |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property and Equipment and Intangible Assets (Note J) | 67523 |  | 78128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee Benefit Assets (Note R) | 97870 |  | 36879 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Miscellaneous | 259 |  | 261 |
|  |  | 165652 | 115268 |
| **TOTAL ASSETS** |  | **42473316** | **39469675** |

---

---

| | | | |
|:---|:---|:---|:---|
| **LIABILITIES AND EQUITY** |  | **2024** | **2023** |
| ACCOUNTS PAYABLE (Note L) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued Financial Charges | 804118 |  | 735066 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Accounts Payable | 709243 |  | 869098 |
|  |  | 1513361 | 1604164 |
| EMPLOYEE BENEFIT LIABILITIES (Note R) |  | 266195 | 266843 |
| DERIVATIVE LIABILITIES (Note G) |  | 2053344 | 2007866 |
| BORROWINGS (Note K) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrowings at Fair value | 26196006 |  | 24562870 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrowings at Amortized cost | 208024 |  | 213538 |
|  |  | 26404030 | 24776408 |
| **TOTAL LIABILITIES** |  | **30236930** | **28655281** |
| EQUITY (NOTE M) |  |  |  |
| Capital |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subscriptions paid | 7533477 |  | 6951686 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cumulative Exchange Adjustment on Subscriptions (CEAS) | (146706) |  | (151635) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subscriptions Paid (net of CEAS) |  | 7386771 | 6800051 |
| Subordinated Notes |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Hybrid Capital Instrument |  | 563859 |  |
| Reserves |  | 4285756 | 4014343 |
| TOTAL EQUITY |  | 12236386 | 10814394 |
| **TOTAL LIABILITIES AND EQUITY** |  | **42473316** | **39469675** |

---

**INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2024**

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| OPERATIONAL INCOME & EXPENSES |  |  |
| Income from: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans and related derivatives (Note N) | 1419006 | 1223550 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury Investments and related derivatives (Note N) | 534491 | 459604 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity Participation Investments - Dividends (Note I) | 20218 | 20478 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Securities | 11692 | 7938 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Income from Loans and Treasury Investments | 1985407 | 1711570 |
| Borrowing Expenses (Note P) | (1402739) | (1191709) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest and amortized issuance costs | (647972) | (515686) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net interest on borrowing-related derivatives | (754767) | (676023) |
| (Losses)/gains on borrowings at FVTPL and related derivatives (Note P) | (7813) | 59478 |
| Net Impairment write-backs/(provisions) (Note C) | 9472 | (18287) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loan principal | 13104 | (2933) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loan charges | (4170) | (12502) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Undisbursed loans | 538 | (2852) |
| Impairment provisions on Financial Guarantees (Note C) | (3948) | (1428) |
| Impairment provisions on Treasury Investments (Note C) | (45) | (31) |
| Impairment (provision)/write-back on Equity Accounted Investments (Note I) | (275) | 677 |
| Currency translation losses | (1266) | (10976) |
| Other income (Note O) | 20014 | 18318 |
| **Net operational income** | **598807** | **567612** |
| OTHER OPERATING EXPENSES |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Administrative Expenses (Note Q) | (207691) | (133116) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and Amortization (Note J) | (34835) | (28090) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sundry expenses | (1869) | (359) |
| Total Other Operating Expenses | (244395) | (161565) |
| **Net Income before distributions approved by the Board of Governors** | **354412** | **406047** |
| Distributions of income approved by the Board of Governors | (106000) | (46000) |
| **NET INCOME FOR THE YEAR** | **248412** | **360047** |

---

*The accompanying notes to the financial statements form part of this statement.*

**STATEMENT OF OTHER COMPREHENSIVE INCOME<br> FOR THE YEAR ENDED 31 DECEMBER 2024**

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| NET INCOME FOR THE YEAR | 248412 | 360047 |
| OTHER COMPREHENSIVE INCOME |  |  |
| *Items that will be subsequently reclassified to income statement* |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair value losses on Cash flow hedge | (11568) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reclassification adjustment to income statement on Cash flow hedge | 863 |  |
| Total items that will be reclassified to income statement | (10705) |  |
| *Items that will not be subsequently reclassified to income statement* |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net fair value (losses)/gains on Equity Investments at FVOCI | (59562) | 50047 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized fair value gains on Borrowings at FVTPL—"own credit" | 24206 | 35577 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Remeasurements of Defined Benefit Obligations | 88164 | (101989) |
| Total items that will not be reclassified to income statement | 52808 | (16365) |
| Total other comprehensive income for the year | 42103 | (16365) |
| **TOTAL COMPREHENSIVE INCOME FOR THE YEAR** | **290515** | **343682** |

---

*The accompanying notes to the financial statements form part of this statement.*

**STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2024**

*(UA thousands)*

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | | **Reserves** | **Reserves** | **Reserves** | **Reserves** | **Reserves** | |
| | <br>**Capital <br> subscriptions <br> paid** | <br>**Cumulative <br> exchange <br> adjustment <br> on <br> subscription** | <br>**Hybrid <br> capital <br> instrument** | **Retained <br> earnings** | **Remeasure- <br> ment of <br> Defined <br> Benefit <br> Plan** | **Net gains/ <br> (losses) on <br> financial <br> assets at <br> FVOCI** | **Unrealized <br> gains/ <br> (losses) on <br> borrowings <br> at fair value <br> arising from <br> "own credit"** | **Cashflow <br> hedge <br> reserve** | <br>**Total equity** |
| **Balance at 1 January 2023** | **6366244** | **(154169)** | **-** | **3465408** | **68936** | **30608** | **105709** | **-** | **9882736** |
| **Net income for the year** | **-** | **-** | **-** | **360047** | **-** | **-** | **-** | **-** | **360047** |
| Other comprehensive income: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net fair value gains on equity investments at FVOCI |  |  |  |  |  | 50047 |  |  | 50047 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized fair value gains on borrowings at FVTPL— "own credit" |  |  |  |  |  |  | 35577 |  | 35577 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Remeasurement losses on defined benefit obligations |  |  |  |  | (101989) |  |  |  | (101989) |
| **Total other comprehensive income** |  | **-** |  | **-** | **(101989)** | **50047** | **35577** | **-** | **(16365)** |
| **Total comprehensive income for the year** | **-** | **-** | **-** | **360047** | **(101989)** | **50047** | **35577** | **-** | **343682** |
| Net increase in paid-up capital | 585442 |  |  |  |  |  |  |  | 585442 |
| Net conversion gains on new subscription |  | 2534 |  |  |  |  |  |  | 2534 |
| **Balance at 31 December 2023** | **6951686** | **(151635)** | **-** | **3825455** | **(33053)** | **80655** | **141286** | **-** | **10814394** |
| **Net income for the year** | **-** | **-** | **-** | **248412** | **-** | **-** | **-** | **-** | **248412** |
| Other comprehensive income: |  |  |  |  |  |  |  |  |  |
| *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* | *Items that will be subsequently reclassified to the income statement* |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net fair value losses on |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;cashflow hedge |  |  |  |  |  |  |  | (10705) | (10705) |
| *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* | *Items that will not be subsequently reclassified to the income statement* |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net fair value losses on equity investments at FVOCI |  |  |  |  |  | (59562) |  |  | (59562) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized fair value gains on borrowings at FVTPL— "own credit" |  |  |  |  |  |  | 24206 |  | 24206 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Remeasurement gains on defined benefit obligations |  |  |  |  | 88164 |  |  |  | 88164 |
| **Total other comprehensive income** |  |  |  |  | **88164** | **(59562)** | **24206** | **(10705)** | **42103** |
| **Total comprehensive income for the year** | **-** | **-** | **-** | **248412** | **88164** | **(59562)** | **24206** | **(10705)** | **290515** |
| Net increase in paid-up capital | 581791 |  |  |  |  |  |  |  | 581791 |
| Net conversion gains on new subscription |  | 4929 |  |  |  |  |  |  | 4929 |
| Hybrid capital—issue proceeds |  |  | 563859 |  |  |  |  |  | 563859 |
| Hybrid capital—issue transaction costs |  |  |  | (2831) |  |  |  |  | (2831) |
| Hybrid capital—discretionary coupon paid |  |  |  | (16271) |  |  |  |  | (16271) |
| **Balance at 31 December 2024** | **7533477** | **(146706)** | **563859** | **4054765** | **55111** | **21093** | **165492** | **(10705)** | **12236386** |

---

**STATEMENT OF CASH FLOWS OR THE YEAR ENDED 31 DECEMBER 2024**

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| **OPERATING ACTIVITIES:** |  |  |
| Net income for the year | 248412 | 360047 |
| Adjustments to reconcile net income to net cash provided by Operating Activities: |  |  |
| Depreciation and amortization | 34835 | 28090 |
| (Gains)/losses on disposal of property and equipment | (45) | 80 |
| Net impairment (write-back)/provisions on loan principal and charges | (9470) | 18287 |
| Unrealized gains on treasury investments and related derivatives | (3556) | (57913) |
| Amortization of discount or premium on treasury investments at amortized cost | (3759) | 2218 |
| Impairment provisions on treasury investments | 45 | 31 |
| Impairment provisions on financial guarantees | 3948 | 1428 |
| Income on equity accounted investments | 275 | (677) |
| Amortization of borrowing issuance costs | 3213 | 538 |
| Unrealized (gains)/losses on borrowings at FVTPL and related derivatives | 7813 | (59478) |
| Currency translation losses | 1266 | 10976 |
| Share of gains on equity accounted investments | (282) | (374) |
| Net movements in derivatives | (217788) | 99079 |
| Changes in accrued income on loans | (79454) | (149610) |
| Changes in accrued financial charges | 69051 | 208041 |
| Changes in employee benefit assets & liabilities | (61639) | 1533 |
| Changes in other accounts receivable and payable | 410954 | (302941) |
| **Net cash used in operating activities** | **403819** | **159355** |
| **INVESTING, LENDING AND DEVELOPMENT ACTIVITIES:** |  |  |
| Disbursements on loans | (3500146) | (3027970) |
| Repayments of loans | 1792269 | 1876240 |
| Treasury investments maturing after 3 months of acquisition: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury investments at FVTPL | (1424974) | 318206 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury investments at amortized cost | 152006 | (893064) |
| Acquisition of property and equipment | (24239) | (22193) |
| Proceeds from disposal of property and equipment | 54 | 16 |
| Disbursements on equity participations | (72151) | (80292) |
| Repayments on equity participations | 68009 | 32216 |
| **Net cash used in investing, lending and development activities** | **(3009170)** | **(1796841)** |
| **FINANCING ACTIVITIES:** |  |  |
| New borrowings | 4850332 | 5392106 |
| Repayments on borrowings | (3261518) | (5605015) |
| Payments of lease liabilities | (10378) | (9654) |
| Proceeds from capital subscriptions | 586720 | 587975 |
| Proceeds from hybrid capital instrument issuance | 563859 |  |
| Transaction cost on hybrid capital instrument issuance | (2831) |  |
| Discretionary coupon on hybrid capital instruments | (16269) |  |
| **Net cash generated from financing activities** | **2709915** | **365412** |
| **Net increase in cash and cash equivalents** | **104564** | **(1272074)** |
| Effect of exchange rate changes on cash and cash equivalents | (58814) | (67220) |
| Cash and cash equivalents at the beginning of the year | 1959092 | 3298386 |
| **Cash and cash equivalents at end of the year** | **2004842** | **1959092** |
| COMPOSED OF: |  |  |
| Investments maturing within 3 months from acquisition: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments at fair value through profit and loss | 1145536 | 575943 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash | 859306 | 1383149 |
| **Cash and cash equivalents at the end of the year** | **2004842** | **1959092** |
| *SUPPLEMENTARY DISCLOSURE* |  |  |
| 1. Cash flow from interests and dividends: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest paid | (1471790) | (1399751) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest received | 1414448 | 1441104 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend received | 20218 | 20478 |
| 2. Movement resulting from exchange rate fluctuations: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans | (9532) | (76730) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrowings | (160128) | 127578 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Currency swaps | 335751 | (115469) |

---

*The accompanying notes to the financial statements form part of this statement.*

**NOTES TO THE FINANCIAL STATEMENTS**

**FOR THE YEAR ENDED 31 DECEMBER 2024**

**NOTE A—OPERATIONS AND AFFILIATED ORGANIZATIONS**

The African Development Bank (AfDB or the Bank) is a multilateral development finance institution dedicated to the economic and social progress of its Regional Member Countries. The Bank's Headquarters is located in Abidjan, Côte d'Ivoire. The Bank finances development projects and programs in its regional member states, typically in cooperation with other national or international development institutions. In furtherance of this objective, the Bank participates in the selection, study and preparation of projects contributing to such development and, where necessary, provides technical assistance.

The Bank also promotes investments of public and private capital in projects and programs designed to contribute to the economic and social progress of the Regional Member Countries. The activities of the Bank are complemented by those of the African Development Fund (ADF or the Fund), which was established by the Bank and certain countries; and the Nigeria Trust Fund (NTF), which is a special fund administered by the Bank. The AfDB, ADF, and NTF each have separate and distinct assets and liabilities. There is no recourse to the AfDB for obligations in respect of any of the ADF or NTF liabilities. The ADF was established to assist the Bank in contributing to the economic and social development of the Bank's regional members, to promote cooperation and increased international trade particularly among the Bank's members, and to provide financing on concessional terms for such purposes.

In accordance with Article 57 of the Agreement establishing the Bank, the Bank, its property, other assets, income and its operations and transactions shall be exempt from all taxation and customs duties. The Bank is also exempt from any obligation to pay, withhold or collect any tax or duty.

**NOTE B—SUMMARY OF MATERIAL ACCOUNTING POLICY INFORMATION**

The Bank's individual financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB). These financial statements have been prepared under the historical cost convention except for certain financial assets and financial liabilities that are carried at fair value.

The material accounting policy information applied in the preparation of the financial statements are summarized below.

Revenue Recognition

Interest income is accrued and recognized based on the effective interest rate (EIR) for the time such instrument is outstanding and held by the Bank. The effective interest rate is the rate that discounts the estimated future cash flows through the expected life of the financial asset to the asset's net carrying amount. Interest income is recognized on loans and treasury investments.

Fee and commission income and expenses are recognized in the income statement when due in line with the contract, giving rise to the income or expenses.

Loan origination and similar fees are deferred and recognized over the life of the related loan or financial product as an adjustment of the yield. The amortization of origination fee for loans and related financial products is included in the income statement.

Realized and unrealized fair value gains or losses are recognized in the income statement on financial as- sets and financial liabilities (including derivatives) classified as measured at fair value through profit or loss (FVTPL).

Dividends are recognized on equity instruments (Equity Participation) classified as measured at fair value through other comprehensive income (FVOCI), when the Bank's right to receive the dividends is established.

Functional and Presentation Currencies

The Bank conducts its operations in the currencies of its member countries. As a result of the application of IAS 21, *The Effects of Changes in Foreign Exchange Rates,* the Bank prospectively changed its functional currency from the currencies of all its member countries to the Unit of Account (UA) effective 1 January 2005, as it was concluded that the UA most faithfully represented the aggregation of economic effects of events, conditions and the underlying transactions of the Bank conducted in different currencies.

The UA is also the currency in which the financial statements are presented. The value of the UA is defined in Article 5.1 (b) of the Agreement establishing the Bank (the Agreement) as equivalent to one Special Drawing Right (SDR) of the International Monetary Fund (IMF) or any unit adopted for the same purpose by the IMF.

Currency Translation

Income and expenses are translated to UA at the rates prevailing on the date of the transaction. Monetary assets and liabilities are translated into UA at rates prevailing at the balance sheet date. The rates used for translating currencies into UA at 31 December 2024 and 31 December 2023 are reported in Note V. Non-monetary assets and liabilities are translated into UA at historical rates.

Currency translation changes (gains or losses) are recognized in the income statement in the determination of net income. Capital subscriptions are recorded in UA at the rates prevailing at the time of receipt. When currencies are translated into other currencies, the resulting gains or losses are recognized in the income statement.

The currency translation changes arising from capital subscription payments are reported in the equity com- ponent of the balance sheet as the Cumulative Exchange Adjustment on Subscriptions (CEAS) as they arise from transactions with member countries. The currency translation gains or losses represent the difference between the UA amount at the predetermined rate and the UA amount using the rate at the time of receipt.

Member Countries' Subscriptions

The Bank classifies financial instruments as financial liabilities or equity instruments in accordance with the substance of the contractual arrangements of the instruments and the definition under IAS 32. Issued financial instruments or their components are classified as liabilities if the contractual arrangements result in the Bank having a present obligation to deliver either cash or another financial asset to the holder of the instrument. If this is not the case, the instrument is generally classified as an equity instrument and the proceeds are included in equity, net of transaction costs.

The Bank's member countries' subscriptions meet the conditions for classification as equity with features of puttable financial instruments that include contractual obligations for repurchase or redemption for cash or another financial asset when certain conditions are met.

Although the Agreement establishing the AfDB allows for a member country to withdraw from the Bank, no member has ever withdrawn its membership voluntarily, nor has any member indicated to the Bank that it intends to do so. The stability in the membership reflects the fact that the members, who include both African and non-African countries, are committed to the purpose of the Bank to contribute to the sustain- able economic development and social progress of its Regional Member Countries individually and jointly. Accordingly, as of 31 December 2024, the Bank did not expect to distribute any portion of its net assets due to member country withdrawals.

In the unlikely event of a withdrawal by a country, the Bank shall arrange for the repurchase of the former member's shares. The repurchase price of the shares is the value shown by the books of the Bank on the date the country ceases to be a member, hereafter referred to as "the termination date". The Bank may partially or fully offset amounts due for shares purchased against the members liabilities on loans and guarantees due to the Bank.

The former member would remain liable for direct obligations and contingent liabilities to the Bank for so long as any parts of the loans or guarantees contracted before the termination date are outstanding. If at a date subsequent to the termination date, it becomes evident that losses may not have been sufficiently taken into account when the repurchase price was determined, the former member may be required to pay, on demand, the amount by which the repurchase price of the shares would have been reduced had the losses been taken into account when the repurchase price was determined.

In addition, the former member remains liable on any call, subsequent to the termination date, for unpaid subscriptions, under

the Bank's callable capital provisions, to the extent that it would have been required to respond if the impairment of capital had occurred, and the call had been made at the time the repurchase price of its shares was determined.

In the event that a member was to withdraw, the Bank may set the dates in respect of payments for shares repurchased. If, for example, paying a former member would have adverse consequences for the Bank's financial position, the Bank could defer payment until the risk had passed, and indefinitely if appropriate. Furthermore, shares that become unsubscribed for any reason may be offered by the Bank for purchase by eligible member countries, based on the share transfer rules approved by the Board of Governors. In any event, no payments shall be made until six months after the termination date.

If the Bank were to terminate its operations, all liabilities of the Bank would first be settled out of the assets of the Bank and then, if necessary, out of members' callable capital, before any distribution could be made to any member country. Such distribution is subject to the prior decision of the Board of Governors of the Bank and would be based on the pro-rata share of each member country.

Employee Benefits

Short-term Employee Benefits

Short-term benefits (such as wages, salaries, bonuses etc.) are employee benefits expected to be settled within 12 months of the balance sheet date. Short-term employee benefits are expensed in the income statement as the related service is provided. A liability is recognized for the amount expected to be paid if the Bank has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

Post-employment Benefits

The Bank operates a post-employment benefit plan that combines the features of a defined benefit (DB) and a defined contribution (DC) plan into a hybrid pension structure which are explained below.

Defined Contribution Plans

Under the defined contribution plan component of the hybrid pension scheme, the Bank and its employees pay fixed contributions to an externally administered fund with an investment-grade credit rating, on behalf of the participants. The retirement benefits of the participants depend solely on the contributions made and the plan's investment performance. The Bank has no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods.

The contributions are recognized as pension expense in the income statements when they are due. Contributions not yet transferred to the fund are recorded in accounts payable on the balance sheet and are transferred within the shortest possible time frame.

Defined Benefit Plans

The Bank also operates a Staff Retirement Plan (SRP) as part of the hybrid pension scheme, that is accounted for as a defined benefit plan. A defined benefit plan is a pension plan that defines an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as accrual rate, age, contribution years of service and average remuneration. The liability recognized in the balance sheet in respect of defined benefit is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets.

The calculation of the cost of providing benefits for the Defined Benefit is performed annually by a qualified actuary using the Projected Unit Credit Method1. Upon reaching retirement age, pension is calculated based on the average remuneration for the final three years of pensionable service and the pension is subject to annual inflationary adjustments.

Remeasurement of net defined benefit obligation, comprises of actuarial gains and losses as well as the differences between interest calculated at the discount rate and real returns on assets (excluding any net change in effect of asset ceiling). Remeasurements are recognized immediately in other comprehensive in- come (OCI) in the year they occur. Net interest expense and other expenses related to the defined benefit are recognized in the income statement.

When benefits of a plan are changed or when a plan is curtailed, the resulting change in benefits that relate to past service or the gain or loss on curtailment is recognized immediately in income statement. The Bank recognizes gains and losses on settlement of a defined benefit plan when the settlement occurs.

Medical Benefit Plan

The Bank also operates a defined Medical Benefit Plan (MBP), which provides post-employment healthcare benefits to eligible former staff, including retirees. Membership of the MBP includes both staff and retirees of the Bank. The entitlement to the post-retirement healthcare benefit is usually conditional on the employee contributing to the plan up to retirement age and the completion of a minimum service period.

The MBP is accounted for as a defined benefit plan. The expected costs of these benefits derive from contributions from plan members as well as the Bank and are accrued over the period of employment and during retirement. Contributions by the Bank to the MBP are charged to expenses and included in the income statement.

The liability recognized in the balance sheet in respect of MBP is the present value of the defined benefit obligation at the balance sheet date less the fair value of plan assets. The calculation of the cost of providing benefits for the MBP is performed annually by a qualified actuary using the Projected Unit Credit Method.

Remeasurement of net defined benefit obligation, comprises of actuarial gains and losses as well as the differences between interest calculated at the discount rate and real returns on plan assets (excluding any net change in effect of asset ceiling). Remeasurements are recognized immediately in OCI in the year they occur. Net interest expense and other expenses related to the MBP are recognized in income statement.

The details of the Bank's employee benefits and compensations are included in Note R—Employee Benefits.

Financial Instruments

Financial assets and financial liabilities are recognized on the Bank's balance sheet when the Bank assumes related contractual rights or obligations. All financial assets and financial liabilities are initially recognized at

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Projected Unit Credit method ensures that pension liabilities are recognized in a manner that reflects
the long-term nature of the obligation, with gradual accrual of pension benefits over time. It uses projected salary increases and actuarial
assumptions to measure the obligation, and the resulting expenses and liabilities are reflected appropriately in both the balance sheet
and the income statement, while actuarial gains and losses reported in OCI.

fair value plus for an item not at fair value through profit or loss (FVTPL), transaction costs that are directly attributable to the acquisition or issue.

1) Financial Assets

In accordance with IFRS 9, the Bank manages its financial assets in line with the applicable business model and accordingly, classifies its financial assets into the following categories: financial assets at amortized cost; financial assets at FVTPL; and financial assets at FVOCI, on the basis of both criteria:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the Bank's business model for managing the financial assets; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the contractual cash flow characteristics of the financial assets.

In line with the Bank's business model, financial assets are held either for the stabilization of income through the management of net interest margin or for liquidity management. The Bank's investments in the equity of enterprises, whether in the private or public sector, are for the promotion of the economic development of its member countries and not for trading to realize fair value changes or short-term trading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Financial Assets at Amortized Cost

A financial asset is classified as at "amortized cost" only if the asset meets two criteria: the objective of the Bank's business model is to hold the asset to collect the contractual cash flows, and the contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal outstanding. The nature of any derivatives embedded in debt investments is considered in determining whether the cash flows of the investment are solely payment of principal and interest on the principal outstanding and are not accounted for separately.

Financial assets other than those classified at amortized cost are classified as measured at fair value through profit or loss or other comprehensive income, as appropriate, if either of the two criteria above is not met.

Financial assets at amortized cost include cash and cash equivalents, some loans and receivables on amounts advanced to borrowers and certain debt investments that meet the criteria of financial assets at amortized cost. Receivables comprise demand obligations, accrued income and receivables from loans and investments and other amounts receivable. Loans and receivables meeting the two criteria above are carried at amortized cost using the effective interest method.

Loans with conversion options that could substantially change the future cash flows from the loan do not usually represent solely payments of principal and interest and are measured at FVTPL. The fair value of such loans with conversion options is determined using the expected cash flows model with inputs including interest rates and the borrower's credit spread estimated based on the Bank's internal rating methodology for non-sovereign loans.

Debt investments classified as financial assets at amortized cost include non-derivative treasury investments with fixed or determinable payments and fixed maturities. These investments are carried and subsequently measured at amortized cost using the effective interest method.

ii) Financial Assets at Fair Value through Profit or Loss

Financial assets that do not meet the amortized cost criteria as described above are measured at FVTPL. This category includes all treasury assets held for resale to realize short-term fair value changes as well as certain loans for which the criteria for recognition at amortized cost is not met. Realized and unrealized gains or losses on these financial assets are reported in the income statement in the period in which they arise. Derivatives are also categorized as financial assets at FVTPL.

In addition, financial assets that meet amortized cost criteria can be designated and measured at FVTPL. A debt instrument may be designated as at FVTPL upon initial recognition if such designation eliminates or significantly reduces a measurement or recognition inconsistency that would arise from measuring assets or liabilities or recognizing the gains and losses on them on different measurement bases.

iii) Financial Assets at Fair Value through Other Comprehensive Income—Equity

On initial recognition, the Bank can make an irrevocable election (on an instrument-by-instrument basis) to designate investments in equity instruments not held for trading as financial assets measured at FVOCI.

Equity investments are initially measured at fair value plus transaction costs. Subsequently, they are measured at fair value with gains and losses arising from fair value measurement recognized in other comprehensive income and transferred to appropriate reserve in equity. The cumulative gains or losses in equity are not reclassified to income statement on disposal of the equity investments but may be reclassified to retained earnings. Dividends earned from such investments are recognized in the income statement unless the dividends clearly represent a repayment of part of the cost of the investment, in which case, they are recognized against the carrying amount of the equity investment.

Recognition and Derecognition of Financial Assets

Regular way purchases and sales of financial assets are recognized and derecognized on a trade-date basis, which is the date on which the Bank commits to purchase or sell the asset. Loans are recognized when cash is advanced to the borrowers. Financial assets not carried at fair value through profit or loss are initially recognized at fair value plus transaction costs.

The Bank derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial assets are transferred or in which the Bank neither transfers nor retains substantially all the risks and rewards of ownership and it does not retain control of the financial asset. Any interest in transferred financial assets that qualify for derecognition that is created or retained by the Bank is recognized as a separate asset or liability on the Balance sheet.

On derecognition of a financial asset, the difference between the carrying amount of the asset (or the carrying amount allocated to the portion of the asset derecognized) and the sum of (i) the consideration received (including any new asset obtained less any new liability assumed) and (ii) any cumulative gain or loss that had been recognized in other comprehensive income (OCI) is recognized in the income statement. Any cumulative gain/loss recognized in OCI and retained in the reserve in respect of equity instruments designated as at FVOCI is not recognized in the income statement on derecognition of such instruments.

During the course of its development activities, the Bank enters into transactions (for example, sale and repurchase agreements, credit protection or financial guarantee contracts etc.) whereby it transfers financial assets recognized on its Balance sheet but retains either all or substantially all of the risks and rewards of the transferred assets or a portion of them. In such cases, the transferred assets are not derecognized on the balance sheet.

Securities Purchased under Resale Agreements, Securities Lent under Securities Lending Agreements and Securities Sold under Repurchase Agreements and Payable for Cash Collateral Received

Securities purchased under resale agreements, securities lent under securities lending agreements, and securities sold under repurchase agreements are recorded at market rates. The Bank receives securities purchased under resale agreements, monitors the fair value of the securities, and if necessary, closes out transactions and enters into new repriced transactions. The securities transferred to counterparties under the repurchase and security lending arrangements and the securities transferred to the Bank under the resale agreements do not meet the accounting criteria for treatment as a sale.

Therefore, securities transferred under repurchase agreements and security lending arrangements are retained as assets on the Bank balance sheet, and securities received under resale agreements are not recorded on the Bank's balance sheet. In cases where the Bank enters into a "reverse repo"—that is, purchases an asset and simultaneously enters into an agreement to resell the same at a fixed price on a future date—a receivable from reverse repurchase agreement and an obligation under repurchase are recognized in the statement of financial position. However, the underlying asset is not recognized in the financial statements.

Cash and Cash Equivalents

Cash and cash equivalents comprise cash on hand, demand deposits and other short-term, highly liquid in- vestments that are readily convertible to a known amount of cash, are subject to insignificant risk of changes in value and have a time to maturity upon acquisition of three months or less.

2) Financial Liabilities

In the ordinary course of its business, the Bank borrows funds in major capital markets for lending and liquidity management purposes. The Bank issues different debt instruments denominated in various currencies, with differing maturities at fixed or variable interest rates. The Bank's borrowing strategy is driven by three major factors, ensuring: timeliness in meeting cash flow requirements, optimizing asset and liability management with the objective of mitigating exposure to financial risks, and providing cost-effective funding.

In addition to long and medium-term borrowing, the Bank also undertakes short-term borrowing for cash and liquidity management purposes only. Borrowings not designated at fair value through profit or loss are carried on the balance sheet at amortized cost with interest expense determined using the effective interest method. Borrowing expenses are recognized in the income statement and include the amortization of issuance costs, discounts and premiums, which is determined using the effective interest rate (EIR) method. Borrowing activities may create exposure to market risk, most notably interest rate and currency risks.

The Bank uses derivatives and other risk management approaches to mitigate such risks. Details of the Bank's risk management policies and practices are contained in Note C to these financial statements. Certain of the Bank's borrowings obtained prior to 1990, from the governments of certain member countries of the Bank, are interest-free.

The Bank classifies its financial liabilities including borrowings as subsequently measured as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Financial Liabilities at Fair Value through Profit or Loss

The Bank classified a certain portion of its borrowings at FVTPL. This category has two sub-categories: financial liabilities held for trading, and those designated at FVTPL at inception. Derivatives are categorized as held-for-trading. The Bank applies fair value designation primarily to borrowings that have been swapped into floating-rate debt using derivative contracts. In these cases, the designation of the borrowing at FVTPL is made in order to significantly reduce accounting mismatches that otherwise would have arisen if the borrowings were carried on the balance sheet at amortized cost while the related swaps are carried on the balance sheet at fair value.

In accordance with IFRS 9, fair value changes in the Bank's financial liabilities that are designated as at FVTPL are presented as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the amount of change in the fair value that is attributable to changes in the Bank's "own
credit risk" are presented in OCI; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• the remaining amount of change in the fair value is presented in the income statement.

Amounts presented in OCI are never reclassified to the income statement when the liability is settled or derecognized. However, the Bank transfers the cumulative gain or loss within equity i.e., to retained earnings.

ii) Other Liabilities

All financial liabilities and borrowings that are not derivatives or designated at FVTPL are subsequently measured at amortized cost. These include borrowings at amortized cost, accrued finance charges on borrowings and other accounts payable and liabilities. All financial liabilities are derecognized when they are discharged or canceled or when they expire.

iii) Financial Guarantee Contracts

Financial guarantee contracts are contracts that require the issuer to make specified payments to reimburse the holder for an incurred loss because a specified debtor fails to make payments when due in accordance with the terms of a specified debt instrument. The Bank writes or issues financial guarantee contracts—which are not managed on a fair value basis—to its clients including banks, financial institutions and other parties. IFRS 9 requires written or issued financial guarantee contracts to be initially recognized at fair value. The fair value of a financial guarantee contract issued in a stand-alone arm's length transaction to an unrelated third party is likely equal to the amount of premium received.

For financial guarantee contracts that are not managed on a fair value basis, they are subsequently measured at the higher of the loss allowance determined in accordance with IFRS 9 and the amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance with IFRS 15.

The Bank applies the derecognition principles when it purchases transactions that meet the definition of a financial guarantee contract and uses judgement to apply the relevant guidance in IFRS to determine whether a purchased financial guarantee contract is an integral element of the loan or debt instrument or be ac- counted for as a separate contract in the financial statements.

Where the Bank is the buyer or holder of a transaction (e.g. credit protection or similar activities) that meets the definition of a financial guarantee contract, it applies judgement to determine whether the financial guarantee contract is an integral element of the loan (or pool of loans instruments) or should be recognized as a separate contract on the financial statements. When measuring ECLs, IFRS 9 requires that the estimate of expected cash shortfalls shall reflect the cash flows expected from collateral and other credit enhancements that are part (but not limited to those explicitly stated) of the contractual terms and are not recognized separately. Accordingly, when the purchased financial guarantee contract is deemed integral to the loan, the cashflows expected from the credit protection (or similar activities) and credit enhancements are included in the ECL estimation of the loan and the cost is treated as a transaction cost included in EIR. In this case, the cash flow from the purchased financial guarantee contract is not accounted for as a separate contract on the financial statements.

For financial guarantee contracts managed on a fair value basis, they are subsequently designated and measured at FVTPL, with fair value gains or losses recognized in the income statement.

iv) Loan commitments—Undisbursed loan

The Bank issues commitments to disburse or grant loans to its customers as part of its lending activities. Undisbursed loans are firm commitments to provide loans to customers under pre-specified terms and conditions. It is the Bank's commitment to make available a specified amount of loan or line of credit to a specified obligor under specified credit terms and business objective.

For accounting purposes, commitments to provide a loan at a below-market interest rate are initially measured at fair value. Subsequently, they are measured at the higher of the loss allowance determined in accordance with IFRS 9 and the amount initially recognized less, when appropriate, the cumulative amount of income recognized in accordance with IFRS 15.

Issued Financial Instruments—Equity and Financial Liability

When an entity (e.g. the Bank) issues a financial instrument, it applies the requirements of IAS 32 *Financial Instruments: Presentation* to classify such instrument either as a financial liability or equity. This determination is based on the substance of the contractual arrangement and the definitions of a financial liability and equity instrument.

A financial instrument is classified as a financial liability where the Bank *has a contractual obligation* to deliver cash or other financial assets or exchange financial assets or financial liabilities under conditions that are potentially unfavourable to the Bank. Also, a financial instrument that creates an obligation is classified as a financial liability if the entity does not have the unconditional right to avoid delivering cash or another

financial asset in settlement of that obligation i.e. there is a contractual obligation to mandatorily redeem the instruments cash flows (i.e. principal and interest) over a maturity date.

Equity is any instrument that evidences a residual interest in an entity's assets after deducting all liabilities. A financial instrument is classified as equity where the Bank:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *does not have any contractual obligation* to deliver cash or other financial assets or exchange
financial assets or financial liabilities under conditions that are not potentially unfavourable to the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• *intends or will settle the instrument in its own equity instrument:* 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*•* The instrument is a non-derivative that includes no contractual obligation to deliver a variable number
of its own equity instrument or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*•* The instrument is a derivative that will be settled only by exchanging a *fixed amount of cash* or
another financial asset for a *fixed number of its own equity instruments.* 

Hybrid Capital Instrument

The Bank issued deeply subordinated and perpetual hybrid capital or notes as part of its capital raising activities. The hybrid capital is unsecured and ranks *pari passu* amongst other Hybrid capital. At its sole and absolute discretionary and contractual rights, the Bank can make a call or an early redemption of the hybrid capital, and the hybrid capital could also be redeemed upon the occurrence of a rating methodology or accounting event or at any time pursuant to a substantial repurchase event. The hybrid capital carries a discretionary coupon, which the Bank can unilaterally declare and pay, cancel or defer indefinitely. The hybrid capital also includes a permanent write-down feature that would be triggered if certain events occur in future and the permanent write-down feature, cancellation or indefinite deferral of interest will not constitute a default event.

The holders of the hybrid capital are exposed to residual risk and they do not have any shares or voting rights in the Bank, neither does the Bank have any contractual obligations to repay both principal or coupon on the hybrid capital; all repayment decisions are the sole and absolute discretion of the Bank.

Based on the instrument's contractual terms and IFRS requirements, the hybrid capital meets the definition of equity and was consequently classified and presented under equity in the Bank's financial statements. Accordingly, any consideration received (e.g. Issue Proceeds) will be added directly to equity. Also, any consideration paid (e.g. transaction costs, discretionary coupons plus any associated translation adjustments) if declared and approved, will be deducted directly from equity. Where the Issue Proceed is denominated in foreign currency, the hybrid capital will be recognized at historical cost and is not re-measured over time. The accounting of the issued hybrid capital will not have any impact on the income statement (Note—when the hybrid capital proceed is invested in treasury investment assets, it would be classified under the financial asset classification principles and any associated income, gains or losses would be recognized in the income statement or OCI accordingly depending on assigned classification category).

Derivatives

The Bank uses derivative instruments in its portfolios for asset-liability management, cost reduction, risk management and hedging purposes. These instruments are mainly cross-currency swaps and interest rate swaps. The derivatives on borrowings are used to modify the interest rate or currency characteristics of the debt the Bank issues. This economic relationship is established on the date the debt is issued and maintained throughout the terms of the contracts. The interest component of these derivatives is reported as part of borrowing expenses.

The Bank classifies all derivatives at fair value, with all changes in fair value recognized in the income statement. When the criteria for the application of the fair value option are met, then the related debt is also carried at fair value with changes in fair value recognized in the income statement.

The Bank assesses its hybrid financial assets (i.e. the combined financial asset host and embedded derivative) in its entirety to determine their classification. A hybrid financial asset is measured at amortized cost if the combined cash flows represent solely principal and interest on the outstanding principal; otherwise it is measured at fair value. As at 31 December 2024, the Bank had a hybrid loan (with nil balance) classified and measured at FVTPL in accordance with IFRS 9.

Derivatives embedded in financial liabilities or other non-financial host contracts are treated as separate derivatives when their risks and characteristics were not closely related to those of the host contract and the host contract was not carried at fair value with unrealized gains or losses reported in the income statement. Such derivatives are stripped from the host contract and measured at fair value with unrealized gains and losses reported in the income statement.

Derivative Credit Valuation (CVA) and Funding Valuation Adjustment (FVA)

CVA (Credit Valuation Adjustment) and FVA (Funding Valuation Adjustment) are both adjustments made to the value of financial derivatives and other contracts to account for various risk factors, specifically related to credit and funding costs. The Bank calculates CVA to reflect counterparty credit risk exposure, while the FVA is calculated to reflect the cost of funding (for example, the cost the Bank incurs to finance a swap). Valuation adjustment for counterparty and funding risk (CVA/FVA) is recognized on derivative financial instruments to reflect the impact on fair value of counterparty credit risk and the Bank's "own credit" quality. This adjustment takes into account the existing compensating agreements for each of the counterparties. The CVA is determined on the basis of the expected positive exposure of the Bank vis-à-vis the counterparty, the FVA is calculated on the basis of the expected negative exposure of the Bank vis-à-vis the counterparty, and the funding spreads, on a counterparty basis. These calculations are recognized on the life of the potential exposure and concentrate on the use of observable and relevant market data.

Hedge Accounting

The Bank applies hedge accounting with the objective of representing in the financial statements, the effect of its risk management activities involving the use financial instruments to manage exposures arising from particular risks that could affect profit or loss (or in some cases OCI). Hedge accounting helps to modify the normal basis for recognizing gains and losses arising from hedging instruments and hedged items in a hedging relationship, so that both are recognized in the profit or loss (or OCI) in the same accounting period. On adopting IFRS 9, the Bank's policy choice was to continue applying the requirements of IAS 39 regarding hedge accounting until the proposed "Financial Instruments: Accounting for Dynamic Risk Management' standard is completed and mandatorily effective.

At inception of the hedge, the Bank designates and documents the relationship between the hedging instrument and the hedged item, along with its risk management objectives and its strategy for undertaking the hedge transactions. Furthermore, at the inception of the hedge and on an ongoing basis, the Bank documents whether the hedging instrument has an economic relationship with the hedged items in offsetting changes in their fair values or cash flows. In this, the Bank performs reliably measurable prospective and retrospective hedge effectiveness to assess that the hedge was expectedly and actually highly effective in achieving offsetting changes in fair value or cash flows attributable to the hedged risk in line with the documented risk management strategy. Hedge accounting is prospectively discontinued when the Bank's risk management objective for the hedging relationship has changed and revokes the designation when the hedging instrument expires or is sold, terminated, or exercised, or when it no longer meets the criteria for hedge accounting, or when a forecast transaction (i.e. cash flow hedge) is not expected to occur again.

Fair Value Hedges

The Bank applies fair value hedge accounting to exposure to changes in fair value of a recognized asset or liability, an unrecognized commitment (or a specified portion) that is attributable to a particular item that could affect the income statement. In this, the Bank uses interest rate swaps contracts (or other qualifying

derivatives) to hedge interest rate risk exposure associated with its fixed rate loans and other eligible financial instruments.

The Bank applies fair value hedge accounting to interest rate swaps contracts to hedge the interest rate risk exposure associated with its fixed rate loans and other eligible financial instruments.

For all eligible fair value hedge relationships, the change in the fair value arising from remeasuring the hedging instrument is recognized in the income statement. Also, the change in the fair value of the hedged item attributable to the hedged risk adjusts the carrying amount of the hedge item and is recognised in the income statement.

The cumulative fair value adjustment to the carrying amount of the hedged item arising from the hedged risk is amortized to income statement using appropriate methodology from the date the fair value adjustment is available and fully amortized at maturity.

Cash Flow Hedges

The Bank applies cash flow hedge accounting to mitigate exposure to variability in cash flow risks arising from a particular risk associated with a recognized assets or liabilities (e.g. variable rate loans and other eligible financial instruments) or a highly probable forecast transactions (e.g. future purchase of a bond) that could affect the income statement.

For all eligible cash flow hedge relationships, the effective portion of changes in the fair value of the hedging instrument is recognized in OCI and accumulated within the cash flow hedge reserve in equity. The ineffective portion of changes in the fair value of the hedging instrument is recognized immediately in the income statement. Hedge accounting is discontinued when a hedging instrument is cancelled, terminated or no longer meets the hedge accounting criteria.

The associated gains or losses recognized in OCI and accumulated in equity are reclassified into the income statement as a reclassification adjustment in the same period(s) in which the forecast cashflows affect the income statement (e.g. when interest income is recognized). If the gains or losses accumulated in the reserve is deemed not recoverable in future or as a result of a discontinuation, they shall be recognized as a reclassification adjustment after certain conditions are met.

Impairment of Financial Assets

The Bank applies a three-stage approach to measuring expected credit losses (ECLs) for the following categories of financial assets: Loans and charges (interest and other receivables) and Treasury investments classified as measured at amortized cost, Loan commitments and financial guarantee contracts. Financial assets migrate through the following three stages based on the change in credit risk since initial recognition:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Stage 1: 12-months ECLs

Stage 1 includes financial assets that have not had a significant increase in credit risk (SICR) since initial recognition. The Bank recognizes 12 months of ECLs for stage 1 financial assets. In assessing whether credit risk has increased significantly, the Bank compares the risk of a default occurring on the financial asset as at the reporting date with the risk of a default occurring on the financial asset as at the date of its initial recognition.

ii) Stage 2: Lifetime ECLs—Not Credit Impaired

Stage 2 comprises financial assets that have had a significant increase in credit risk since initial recognition, but for which there is no objective evidence of impairment. The Bank recognizes lifetime ECLs for stage 2 financial assets. For these exposures, the Bank recognizes an allowance amount based on lifetime ECLs (i.e. an allowance amount reflecting the remaining lifetime of the financial asset). A significant increase in credit risk is considered to have occurred when contractual payments are more than 30 days past due and the amount overdue is more than UA 25,000 for sovereign and non-sovereign loans or where, in the case of non-sovereign loans, there has been a rating downgrade since initial recognition.

iii) Stage 3: Lifetime ECLs—credit impaired

Included in stage 3, are financial assets that have been categorized as credit impaired. The Bank recognizes lifetime ECLs for all stage 3 financial assets, as a specific provision. A financial asset is classified as credit impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial instrument have occurred after its initial recognition.

Evidence of impairment includes indications that the borrower is experiencing significant financial difficulties, or a default or delinquency has occurred. A default by an obligor occurs when either or both of the following have taken place:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank considers that the obligor is unlikely to pay its credit obligations in full, without recourse
by the Bank to actions such as realizing security; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The obligor is past due by more than 180 days for sovereign loans and more than 90 days for non- sovereign
loans provided that the amount overdue is more than UA 25,000.

Interest revenue is calculated by applying the effective interest rate to the amortized cost (net of the applicable impairment loss provision) for impaired financial assets falling under stage 3. For assets falling within stage 1 or 2 interest revenue is recognised on the gross carrying amount.

When the Bank has measured the loss allowance for a financial instrument at an amount equal to lifetime ECLs in the previous reporting period but determines at the current reporting date that criteria for recognizing the lifetime ECLs is no longer met i.e., cured, the Bank measures the loss allowance at an amount equal to 12-month ECLs at the current reporting date. A financial asset is considered cured (i.e., no longer impaired) when all past due amounts, including interest, have been recovered, and it is determined that the principal and interest are fully collectable in accordance with the original contractual terms or revised market terms of the financial instrument with all criteria for the impaired classification having been remedied.

Determining the stage for impairment

At each reporting date, the Bank assesses whether there has been a significant increase in credit risk for exposures since initial recognition by comparing the risk of default occurring over the remaining expected life from the reporting date and the date of initial recognition. The Bank considers reasonable and supportable information that is relevant and available without undue cost or effort for this purpose. Refer to Note C Risk Management Policies and Procedures.

An exposure will migrate through the ECLs stages as asset quality deteriorates or improves. For both non- sovereign and sovereign loans, a significant increase in credit risk is considered to have occurred when the rating at reporting date has been downgraded or contractual payments are more than 30 days past due and the overdue amount is higher than UA 25,000. In the case of sovereign loans, however, both the rating downgrade and 30 days overdue must occur at the same time with the overdue amounts exceeding the limit.

If, in a subsequent period, asset quality improves and any previously assessed significant increase in credit risk since origination is reversed, then the provision for doubtful debts reverts from lifetime ECLs to 12-months ECLs. Exposures whose credit rating remains within the Bank's investment grade criteria are considered to have a low credit risk even where their credit rating has deteriorated.

Measurement of Expected Credit Losses

ECLs are derived from unbiased and probability-weighted estimates of expected loss and are measured as follows.

*Financial assets that are not credit-impaired at the reporting date:* as the present value of all cash shortfalls over the expected life of the financial asset discounted by the effective interest rate. The cash shortfall is the difference between the cash flows due to the Bank in accordance with the contract and the cash flows that the Bank expects to receive.

*Financial assets that are credit-impaired at the reporting date:* as the difference between the gross carrying amount and the present value of estimated future cash flows discounted by the effective interest rate.

*Undrawn loan commitments:* as the present value of the difference between the contractual cash flows that are due to the Bank if the commitment is drawn down and the cash flows that the Bank expects to receive.

*Financial guarantee contracts:* as the expected payments to reimburse the holder less any amounts that the Bank expects to recover. ECLs are recognized using a loss allowance account and recognized in the profit and loss.

Write-off

The Bank writes off the gross carrying amount of a financial asset when it has no reasonable expectations of recovering the financial asset in its entirety or a portion thereof.

A write-off constitutes a derecognition event. As such, when the Bank has no reasonable expectations of recovering a loan (i.e. deemed uncollectible), the amount written off is accounted for by directly reducing the outstanding principal and/or interest charges against the related ECLs allowance.

A loan is deemed uncollectible when the Bank determines that an obligor does not have sufficient cash flows from either assets or operational income to repay the amount due for write-off. A loan is therefore deemed uncollectible and written off only after the amount deemed uncollectible has been determined and all internal write-off procedures have been activated, approved, and completed. However, such a loan is still subject to enforcement activity.

Subsequent recoveries of amounts previously deemed uncollectible and written off are recognized as other income in the income statement.

For further details on how the Bank calculates ECLs including the use of forward-looking information, refer to the Credit Quality of Financial Assets section in Note C Risk Management Policies and Procedures.

Offsetting of Financial Instruments

Financial assets and financial liabilities are offset and reported on a net basis when there is a current legally enforceable right to offset the recognized amount. A current legally enforceable right exists if the right is not contingent on a future event and is enforceable both in the normal course of business and in the event of default, insolvency or bankruptcy of the entity and all counterparties and there is an intention on the part of the Bank to settle on a net basis or to realize the asset and settle the liability simultaneously. The Bank dis- closes all recognized financial instruments that are set off and those subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset. Information relating to financial assets and liabilities that are subject to offsetting, enforceable master netting arrangement is provided in Note C Risk Management Policies and Procedures.

Fair Value Disclosure

In active markets, the most reliable indicators of fair value are quoted market prices. A financial instrument is regarded as quoted in an active market if quoted prices are regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency and if those prices represent actual and regularly occurring market transactions on an arm's length basis. If the above criteria are not met, the market is regarded as being inactive.

Indications that a market might be inactive include when there is a wide bid-offer spread or significant in- crease in the bid-offer spread or there are few or no recent transactions observed in the market. When markets become illiquid or less active, market quotations may not represent the prices at which orderly transactions would take place between willing buyers and sellers and therefore may require adjustment in the valuation process. Consequently, in an inactive market, price quotations are not necessarily determinative of fair values.

Considerable judgment is required to distinguish between active and inactive markets. 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. The fair values of financial assets and financial liabilities that are traded in active markets are based on quoted market prices or dealer price quotations. For all other financial instruments, the Bank measures fair values using other valuation techniques that incorporate the maximum use of market data inputs.

The objective of the valuation techniques applied by the Bank is to arrive at a reliable fair value measurement. Other valuation techniques include net present value, discounted cash flow analysis, option pricing models, comparison to similar instruments for which market observable prices exist and other valuation models commonly used by market participants. Assumptions and inputs used in valuation techniques include risk free and benchmark interest rates, credit spreads and other premiums used in estimating discount rates, bond and equity prices, foreign currency exchange rates and expected price volatilities and correlations.

The Bank uses widely recognized valuation models for measuring the fair value of common and simpler financial instruments, like interest rate and currency swaps that use only observable market data and require minimum management judgment and estimation. Availability of observable market prices and model inputs reduces the need for management judgment and estimation and also reduces the uncertainty associated with the measurement of fair value. Observable market prices and inputs available vary depending on the products and markets and are subject to changes based on specific events and general conditions in the financial markets.

Where the Bank measures portfolios of financial assets and financial liabilities on the basis of net exposures, it applies judgment in determining appropriate portfolio level adjustments such as bid-ask spread. Such judgments are derived from observable bid-ask spreads for similar instruments and adjusted for factors specific to the portfolio.

The following three hierarchical levels are used for the measurement of fair value:

**Level 1:** Quoted prices in active markets for the same instrument (i.e., without modification or repackaging).

**Level 2:** Quoted prices in active markets for similar assets or liabilities or other valuation techniques for which all significant inputs are based on observable market data. Included in this category are 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:** Valuation techniques for which significant input is not based on observable market data and the un- observable inputs have a significant effect on the instrument's valuation. Included in this category are instruments that are valued based on quoted market prices for similar instruments where significant unobservable adjustments or assumptions are required to reflect differences between the instruments.

The level in the fair value hierarchy within which the fair value measurement is categorized in its entirety is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. For this purpose, the significance of an input is assessed against the fair value measurement in its entirety. If a fair value measurement uses observable inputs that require significant adjustment based on unobservable inputs, that measurement is a Level 3 measurement. A valuation input is considered observable if it can be directly observed from transactions in an active market, or if there is compelling external evidence demonstrating an executable exit price.

The methods and assumptions used by the Bank in measuring the fair values of financial instruments are as follows.

*Cash:* The carrying amount is the fair value.

*Investments:* Fair values for investment securities are based on quoted market prices, where available. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments.

*Borrowings:* Fair values of the Bank's borrowings are based on market quotations when possible or valuation techniques based on discounted cash flow models using a market-determined floating rate with discount curves adjusted by the Bank's credit spread. Credit spreads are obtained from market data as well as indicative quotations received from certain counterparties for the Bank's new public bond issues. The Bank also uses systems based on industry standard pricing models and valuation techniques to value borrowings and their associated derivatives.

The models use market-sourced inputs such as interest rates, yield curves, exchange rates and option volatilities. Valuation models are subject to internal and periodic external reviews. When a determination is made that the market for an existing borrowing is inactive or illiquid, appropriate adjustments are made to the relevant observable market data to arrive at the Bank's best measure of the price at which the Bank could have sold the borrowing at the balance sheet date.

For borrowings on which the Bank has elected the fair value option, the portion of fair value changes on the valuation of borrowings relating to the credit risk of the Bank is reported in OCI in accordance with IFRS 9.

*Equity investments:* The Bank holds direct equity in various enterprises and private funds which may be listed or unlisted. All equity investments held by the Bank are measured at fair value in line with IFRS 9. Where the underlying assets are periodically valued by fund managers or independent valuation experts using market practices, as in the case of private funds, Management views these valuations as sound representative of fair value.

Where such valuations are unavailable, the percentage of the Bank's ownership of the net asset value of such funds is deemed to approximate the fair value of the Bank's equity participation in such investee entity. The fair value of investments in listed enterprises is based on the latest available quoted bid prices.

*Derivative financial instruments:* The fair values of derivative financial instruments are based on market quotations where possible or valuation techniques that use market estimates of cash flows and discount rates. The Bank also uses valuation tools based on industry standard pricing models and valuation techniques to value derivative financial instruments.

The models use market-sourced inputs such as interest rates, yield curves, exchange rates, and option volatilities. All financial models used for valuing the Bank's financial instruments are subject to both internal and periodic external reviews.

*Loans:* The Bank does not sell its sovereign loans, nor does it believe there is a comparable market for these loans. The Bank's loan assets, except for those at fair value, are carried on the balance sheet at amortized cost. The fair value of loans carried at amortized cost is deemed to approximate their carrying value net of the impairment losses based on the expected credit loss model and represents Management's best measures of the present value of the expected cash flows of these loans.

The fair valuation of loans has been measured using a discounted cash flow model based on year-end market lending rates in the relevant currency including impairment, when applicable, and credit spreads for non-sovereign loans. In arriving at its best estimate Management makes certain assumptions about the un- observable inputs to the model, the significant ones of which are the expected cash flows and the discount rate. These are regularly assessed for reasonableness and impact on the fair value of loans.

An increase in the level of forecast cash flows in subsequent periods would lead to an increase in the fair value and an increase in the discount rate used to discount the forecast cash flows would lead to a decrease in the fair value of loans. Changes in fair value of loans carried at fair value through profit and loss are re- ported in the income statement.

Valuation Processes Applied by the Bank

The fair value measurements of all qualifying treasury investments, borrowings, loans and equity investments are reported to and reviewed by the Assets & Liabilities Management Committee (ALCO) in line with the Bank's financial reporting policies.

Where third-party information from brokers or pricing experts is used to measure fair value, documents are independently assessed and evidence is obtained from the third parties to support the conclusions.

The assessment and documentation involves ensuring that (i) the broker or pricing service provider is duly approved for use in pricing the relevant type of financial instrument; (ii) the fair value arrived at reasonably represents actual market transactions; and (iii) where prices for similar instruments have been adopted, that the same have been, where necessary, adjusted to reflect the characteristics of the instrument subject to measurement and where a number of quotes for the same financial instrument have been obtained, fair value has been properly determined using those quotes.

Day-One Gain or Loss

At initial recognition, the Bank determines fair value of its financial instruments in line with the requirements of IFRS 13. As a result, when the Bank issues a new financial asset or financial liability, it measures the financial asset or financial liability at fair value, plus or minus (in the case of a financial asset or financial liability not at fair value through profit or loss) transaction costs that are directly attributable to the acquisition or issue of the financial asset or financial liability. The best evidence of fair value of a financial instrument at initial recognition is normally the transaction price, that is, the fair value of the consideration given or received.

However, where the fair value of the financial asset or financial liability at initial recognition differs from the transaction price, commonly referred to as day one gain or loss, IFRS requires the Bank to determine the fair value at initial recognition and any gains or losses between the fair value measured at initial recognition and the transaction price are recognized in the income statement as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• If that fair value is evidenced by a quoted price in an active market for an identical asset or liability
(i.e., a Level 1 input) or based on a valuation technique that uses only data from observable markets (i.e, Level 2 inputs), the Bank
recognizes any difference between the fair value at initial recognition and the transaction price immediately as a gain or loss in the
income statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• In all other cases, the difference between the fair value at initial recognition and the transaction price
is deferred. After initial recognition, the Bank recognizes that deferred difference as a gain or loss in the income statement only to
the extent that it arises from a change in a factor (including time) that market participants would take into account when pricing the
asset or liability.

The Bank holds some financial instruments maturing after more than 10 years, where the fair value at initial recognition and transaction price may differ. In this case, the difference between the fair value at initial recognition and the transaction price is accounted for on the basis of the observability of the inputs used to determine the fair value at initial recognition—where fair value is determined on the basis of a quoted price in an active market or a valuation technique that uses only observable data, the day one gain or loss is recognized immediately. Where fair value is not determined on the basis of a quoted price in an active market or a valuation technique that uses only observable data, the day-one gain or loss is either deferred until the instrument's fair value can be determined using a quoted and observable inputs or amortized over the life of the transaction.

Subsequent to initial recognition, these financial instruments are measured at fair value and the resulting gains or losses are recognized in the income statement at the end of the reporting period, with an adjustment for the day-one gain or loss. For accounting purposes therefore, the fair value gains or losses determined on these financial instruments at the end of the reporting period are recognized in the income statement.

Investment in Associates

[Under IAS 28, "Investments in Associates and Joint Ventures," the ADF and any other entity in which the Bank has significant influence are considered associates of the Bank. An associate is an entity over which the Bank has significant influence, but not control, over the entity's financial and operating policy decisions. The relationship between the Bank and the ADF is described in more detail in Note I.

IAS 28 requires that the equity method be used to account for investments in associates. Under the equity method, an investment in an associate is initially recognized at cost and the carrying amount is increased or decreased to recognize the investor's share of the profit or loss of the investee after the date of acquisition.

The investor's share of the profit or loss of the investee is recognized in the investor's income statement. The subscriptions by the Bank to the capital of the ADF occurred between 1974 and 1990. At 31 December 2024, such subscriptions cumulatively represented less than 1 percent of the economic interest in the capital of the ADF.

Although ADF is a not-for-profit entity and has never distributed any dividend to its subscribers since its creation in 1972, IAS 28 requires that the equity method be used to account for the Bank's investment in the ADF. Furthermore, in accordance with IAS 36, the net investment in the ADF is assessed for impairment, and any impairment losses (or impairment reversals) are recognized in the income statements. Cumulative losses as measured under the equity method are limited to the investment's original cost as the AfDB has not guaranteed any potential losses of the ADF.

Property and Equipment

An item of property and equipment is measured at historical cost less accumulated depreciation. Historical cost includes expenditure directly attributable to the acquisition of the items. Where significant parts of an item of property and equipment have different useful lives, they are accounted for as separate items (major components) of the property and equipment.

Subsequent costs are included in the asset's carrying amount or are recognized as a separate asset, as ap- propriate, only when it is probable that future economic benefits associated with the item will flow to the Bank and the cost of the item can be measured reliably. Repairs and maintenance costs are charged to the income statement when they are incurred.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to amortize the difference between cost and estimated residual values over estimated useful lives. Estimated useful lives are as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Buildings: 15–20 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Fixtures and fittings: 6–10 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Furniture and equipment: 3–7 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Motor vehicles: 5 years

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Right-of-use assets: over the shorter of the estimated useful life and lease term.

Work in progress consists of items of property and equipment that are not yet available for use. Work in progress is carried at cost (less any impairment) and depreciation starts when the assets are available for use. Once the items are available for use, they are transferred to relevant classes of property and equipment as appropriate.

Items of property and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying amount may not be recoverable. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount. The recoverable amount is the higher of the asset's fair value less costs to disposal and its value in use.

The residual values and useful lives of property and equipment items are reassessed periodically and adjusted (if appropriate). Any impact arising from the reassessment is recorded in the financial statements.

An item of property and equipment are derecognized on disposal, or when no future economic benefits are expected from their continued use or disposal. Gains and losses on disposal are determined as the difference between proceeds from disposal and the asset's carrying amount. These gains or losses are included in the income statement in the period of disposal.

Intangible Assets

Intangible assets include computer system software and are stated at historical cost less amortization. An intangible asset is recognized only when its cost can be measured reliably, and it is probable that the expected future economic benefits attributable to it will flow to the Bank. Amortization of intangible assets is calculated using the straight-line method to write down the cost of intangible assets to their residual values over their estimated useful lives of 3–5 years.

Amortization methods, useful lives and residual values are reassessed periodically and adjusted if appropriate. Intangible assets are derecognized on disposal or when no future economic benefits are expected from their use or disposal. Gains and losses on disposal are determined as the difference between proceeds from disposal and the asset's carrying amount and included in the income statement.

Leases

As a lessee, the Bank has several contracts for its offices in the headquarters and certain member countries that convey the right to use the offices (the underlying asset) for a period in exchange for consideration. Under such agreements, the contract contains an explicitly identified asset, and the Bank has the right to obtain substantially all of the economic benefits from use of the offices throughout the period of the lease.

At lease commencement date, the Bank recognizes a right-of-use asset and a lease liability on the balance sheet. Right-of-use assets are measured at the amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease payments relating to that lease.

On the statement of financial position, right-of-use assets have been included in property, plant and equipment and lease liabilities have been included in other accounts payable. The Bank depreciates the right-of- use assets on a straight-line basis over the shorter of its estimated useful life and the lease term.

At the commencement date, the Bank measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the Bank's incremental borrowing rate. After the commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced for the lease payments made.

Allocations and Distributions of Income Approved by the Board of Governors

In accordance with the Agreement establishing the Bank, the Board of Governors is the sole authority for approving allocations from income to surplus account or distributions to other entities for development purposes. Surplus consists of earnings from prior years which are retained by the Bank until further decision is made on their disposition or the conditions of distribution for specified uses have been met. Distributions of income for development purposes are reported as expenses on the income statement in the year of approval. Distributions of income for development purposes are deemed as made on behalf of member countries and may be funded from amounts previously transferred to surplus account or from the current year's income in equity.

Allocable Income

Allocable income is a management performance measure that is computed by adjusting Net income before distributions approved by the Board of Governors for unrealized fair value gains and losses from borrowings at FVTPL and related derivatives and currency translation gains or losses and hybrid capital adjustments (which includes transaction costs on issue of hybrid capital, declared, approved paid discretionary coupon to hybrid capital investors and projected discretionary coupon to be paid to investors in future dates but yet to be declared, approved and recorded in the Bank's financial statements).

The Bank uses Allocable Income as a management performance measure for making distribution out of its net income to reserves and development activities. Allocable Income is Net income before distribution approved by the Board adjusted for the impact of volatile unrealized elements of gains or losses on borrowings at fair value and related derivatives and currency translation gains or losses including hybrid capital Adjustments.

Retained Earnings

Retained earnings of the Bank consist of amounts allocated to reserves from prior years' income, balance of amounts allocated to surplus after deducting distributions approved by the Board of Governors, unallocated current year's net income, and expenses recognized directly in equity as required by IFRS.

Cash Flow Hedge Reserve

A cash flow hedge reserve is a reserve that records the effective portion of gains or losses on a hedging instrument. It also records reclassification adjustments (reclassification of gains or losses recognized in reserve in the income statement) in the same period (s) in which the forecast cash flows affect the income statement.

Segment Reporting

An operating segment is a component of the Bank Group that engages in business activities from which it can earn revenues and incur expenses, whose operating results are regularly reviewed by the Chief Operating Decision Maker (that is, Management under the direct authority of the Board) to make decisions about resources to be allocated to the segment and assess its performance. Operating segments are identified and reported in a manner consistent with the internal reporting provided to Management and the Board. The measurement of segment assets, liabilities, income and expenses is in accordance with the Bank Group's accounting policies.

Critical Accounting Judgments and Key Sources of Estimation

Uncertainty in the preparation of financial statements in conformity with IFRS may arise due to various factors and complexities inherent in financial reporting. Management makes certain estimates, assumptions and judgments that affect the reported amounts of assets, liabilities, revenue and expenses as well as the disclosure of contingent liabilities. Actual results could differ from such estimates. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The most significant judgments and estimates are summarized below.

1) Significant Judgments

The Bank's accounting policies require that assets and liabilities be designated at inception into different ac- counting categories. Such decisions require significant judgment and relate to the following circumstances.

*Fair value through profit and loss:* In designating financial assets or liabilities at fair value through profit or loss, the Bank has determined that such assets or liabilities meet the criteria for this classification.

*Amortized cost and embedded derivatives:* The Bank follows the guidance of IFRS 9 on classifying financial assets and those with embedded derivatives in their entirety as at amortized cost or fair value through profit or loss. In making this judgment, the Bank considers whether the cash flows of the financial asset are solely payment of principal and interest on the principal outstanding and classifies the qualifying asset accordingly without separating the derivative.

*Consolidation:* The Bank follows the guidance of IFRS 10 in ascertaining if there are any entities that it controls, and that may require consolidation.

*Impairment losses on financial assets:* The measurement of impairment losses under IFRS 9 across all categories of financial assets requires judgement, in particular, the estimation of the amount and timing of future cash flows and collateral values when determining impairment losses and the assessment of a significant increase in credit risk. These estimates are driven by a number of factors, changes in which can result in different levels of allowances. The methodology and assumptions used for estimating both the amount and timing of future cash flows are reviewed regularly to reduce any differences between loss estimates and actual loss experience.

The Bank's ECLs calculations are outputs of complex models with a number of underlying assumptions regarding the choice of variable inputs and their interdependencies. Elements of the ECL models that are considered accounting judgments and estimates include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank's internal credit grading model, which assigns Probability of Defaults to the individual
grades.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank's criteria for assessing if there has been a significant increase in credit risk necessitating
the loss allowance to be measured on a 12-month or lifetime ECLs basis and the applicable qualitative assessment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Development of ECLs models, including the various formulas and the choice of inputs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Determination of associations between macroeconomic scenarios and, economic inputs, such as unemployment
levels and collateral values, and the effect on the probability of default, likely loss in the event of default, and exposure at default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Selection of forward-looking macroeconomic scenarios and their probability weightings, to derive the economic
inputs into the ECLs models.

2) Significant Estimates

The Bank also uses estimates for its financial statements in the following circumstances.

*Fair Value of Financial Instruments:* The fair value of financial instruments that are not quoted in active markets is measured using valuation techniques. Where valuation techniques (for example, models) are used to measure fair values, they are validated and periodically reviewed by qualified personnel independent of the area that created them. All valuation models are calibrated to ensure that outputs reflect actual data and comparative market prices. To the extent practical, valuation models use only observable data; however, areas such as credit risk (both own and counterparty) volatilities and correlations require Management to make estimates.

Changes in assumptions about these factors could affect the reported fair value of financial instruments. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgment, considering factors specific to the asset or liability. The determination of what constitutes "observable" requires significant judgment by the Bank.

*Post-employment Benefits:* The present value of retirement benefit obligations is sensitive to the actuarial and financial assumptions used, including the discount rate. At the end of each year, the Bank determines the appropriate discount rate and other variables to be used to determine the present value of estimated future pension obligations. The discount rate is based on market yields of high-quality corporate bonds in

the currencies comprising the Bank's UA at the end of the year, and the estimates for the other variables are based on the Bank's best judgment.

Change in Presentation and Comparative Information

In some cases, the Bank may change the presentation of certain line items in the financial statements to enhance inter-period comparability. When such a change in presentation is made, the comparative information is also adjusted as necessary to reflect the new presentation.

Event after the Reporting Period

The financial statements are adjusted to reflect events that occurred between the balance sheet date and the date when the financial statements are authorized for issue, provided they give evidence of conditions that existed at the balance sheet date.

Events that are indicative of conditions that arose after the balance sheet date, but do not result in an adjustment of the financial statements themselves are disclosed. For the year ended 31 December 2024, no events after the reporting period have been disclosed.

Effect of New and Amended International Financial Reporting Standards

A number of new or amended standards became effective for annual periods beginning after 1 January 2024 and beyond with earlier application permitted. The Bank did not early adopt any of the new or amended standards in preparing these financial statements. None of these new/amended standards had any significant impact on the financial statements for the year ended 31 December 2024. Details are provided below.

1) New International Financial Reporting Standards and Amendments Applicable from 1 January 2024

The following standards and amendments became mandatorily effective for annual reporting period commencing 1 January 2024:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Lease Liability and Sale Back—Amendments to IFRS 16

The IASB issued amendments to IFRS 16 *Leases* in September 2022, specifying the principles that a seller-lessee should use in measuring lease liability arising from a sale and leaseback transaction. The Amendments provides a requirement that a seller-lessee should determine 'lease payments' or 'revised lease payments' in a way that the seller-lessee would not recognize any amount of the gain or loss that relates to the right of use retained by the seller-lessee.

ii) Classification of Liabilities as Current or Non-current and non-current liabilities with covenants— Amendments to IAS 1

The IASB issued amendments to IAS 1 *Presentation to Financial Statements* in January 2020 and October 2022, specifying the requirements for classifying liabilities as current or non-current. The amendments require that an entity's right to defer settlement of a liability for at least twelve months after the reporting period must have substance and must exist at the end of the reporting period. Classification of a liability is unaffected by the likelihood that the entity will exercise its right to defer settlement for at least twelve months after the reporting period.

iii) Supplier Finance Arrangements—Amendments to IAS 7 and IFRS 7

The IASB issued Supplier Finance Arrangements amendments, which amended IAS 7 *Statement of Cash Flows* and IFRS 7 *Financial Instruments: Disclosures* in May 2023, specifying the disclosures intended to assist users of financial statements to understand the effect of supplier finance arrangement on entity's liabilities, cash flows and liquidity risk. The Amendments require an entity disclose qualitative and quantitative including provides guidance on characteristics of supplier finance arrangements.

The Bank considered the amendments and determined that they were not significant to its operations and financial statements in reporting period.

2) New International Financial Reporting Standards and Amendments Applicable from 1 January 2025 and beyond

The following standards and amendments had been issued but are mandatorily applicable for annual reporting periods beginning on or after 1 January 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Amendments to IAS 21—Lack of Exchangeability

The IASB issued Lack of Exchangeability which amended IAS 21 *The Effects of Changes in Foreign Exchange Rates* in August 2023. The amendment is to assist an entity in assessing whether a currency can be ex- changed for another and determining the appropriate spot exchange rate when it is not. The Amendments require an entity to estimate the spot exchange rate when it concludes that a currency is not exchangeable into another currency. The amendments are effective for annual periods beginning on or after 1 January 2025 and earlier application is permitted.

Management is currently assessing the effect of the standard on its operations and would decide on its application accordingly.

ii) Amendments to the Classification and Measurement of Financial Instruments—Amendments to IFRS 9 and IFRS 7

The IASB introduced targeted amendments to IFRS 9 *Financial Instruments* and IFRS 7 *Financial Instruments: Disclosures* in May 2024, to address recent practical challenges and incorporate new requirements applicable to both financial institutions and corporate entities. These amendments:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Clarify the recognition and derecognition dates for certain financial assets and liabilities, introducing
an exception for specific financial liabilities settled via an electronic cash transfer system.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Provide further clarification and guidance on assessing whether a financial asset meets the solely payments
of principal and interest (SPPI) criterion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Introduce new disclosure requirements for financial instruments with contractual terms that may alter
cash flows, such as those linked to ESG targets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Revise disclosure requirements for equity instruments designated at fair value through other comprehensive
income (FVOCI).

The amendments are effective for annual periods beginning on or after 1 January 2026 and earlier application is permitted.

Management is currently assessing the effect of the standard on its operations and would decide on its application accordingly.

iii) IFRS 19 Subsidiaries without Public Accountability: Disclosures

The IASB issued IFRS 19 in May 2024, which applies to entities without public accountability, but whose parents prepare consolidated financial statements under IFRS Accounting Standards. IFRS 19 allows eligible entities to elect to apply reduced disclosure requirements while still applying the recognition, measurement and presentation requirements in other IFRS accounting standards. The standard is effective for annual periods beginning on or after 1 January 2027. Early adoption is permitted. The standard is not expected to have any significant effect on the Bank' financial statements.

iv) IFRS 18 Presentation and Disclosure in Financial Statements

The IASB issued IFRS 18 to replace IAS 1 *Presentation of Financial Statements.* IFRS 18 sets out the presentation and base disclosure requirements for financial statements and introduced changes, which will mostly

affect the income statement. The standard requires an entity to classify items of income and expenses into three new categories—operating, investing and financing—and present subtotals for operating profit or loss. It also provides enhanced guidance for aggregation and disaggregation of information in the financial statements, introduces new disclosure requirements for management-defined performance measures (MPMs) and eliminates classification options for interest and dividends in the statement of cash flows. The standard is effective for annual periods beginning on or after 1 January 2027. Early adoption is permitted but disclosure is required.

Management is currently assessing the effect of the standard on its operations and would decide on its application accordingly.

3) New International Financial Reporting Sustainability Standards

The International Sustainability Standards Board released its first two IFRS Sustainability Reporting Standards in June 2023. The standards are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) IFRS S1 General Requirements for Disclosure of Sustainability-related Financial Information

Sets out overall requirements for sustainability-related financial disclosures with the objective to require an entity to disclose information about its material sustainability-related risks and opportunities that is useful to primary users of general-purpose financial reports in making decisions relating to providing resources to the entity; and

ii) IFRS S2 Climate-related Disclosures

IFRS S2 sets out the requirements for identifying, measuring, and disclosing information about material climate-related risks and opportunities that is useful to primary users of general-purpose financial reports in making decisions relating to providing resources to the entity.

The standards are effective from 1 January 2024, but individual jurisdictions are required to decide whether and when to adopt and start applying these standards. The Bank is currently considering the requirements of these standards and would determine the most appropriate application date in due course.

Economic Outlook

In 2025, global economic growth is projected to stabilize due to declining inflation levels and policy rates easing by monetary authorities, and the attendant increase in economic activities. However, growth is expected to remain too slow and weak to sustain economic development, due to years of multiple shocks that have particularly affected the most vulnerable countries and widened the income disparity between advanced and developing countries.

In its latest Global Economic Prospects report of January 2025, the World Bank forecasts a global growth rate of 2.7 percent for 2025 and 2026, on the back of the relative return of inflation to target, ease in monetary rates and financial conditions, and modestly better trade and economic context. The World Bank noted, however, the substantial policy uncertainty and downside risks and other headwinds that may weaken the global rate more than projected. The World Bank therefore advised global authorities to put in place policy actions to drive long-term development.

The Bank Group Latest Macroeconomic Performance and Outlook report (MEO 2025), released in February 2025. projected the average real GDP growth rate for Africa at 4.1 percent and 4.4 percent respectively for 2025 and 2026, from a 3.2 percent estimate in 2024. This favourable growth forecast was based on the results of policy reforms in many African countries, aimed at improving sectoral productivity, quality and competitiveness (e.g. agriculture and manufacturing), and enhancing sustainable fiscal and debt positions. The report also projected that a reduction in the continent's average inflation rate from 18.6 percent in 2024 would steady at 12.6 percent in 2025 and 2026, due to tighter monetary policies and action. The MEO 2025

further indicated that Africa's economic performance is showing signs of improvement but remains vulnerable to global shocks and government policy actions are required for sustainable and inclusive growth.

Therefore, for growth to be inclusive in 2025, global and national authorities must pursue sound policy re- forms to address fiscal imbalances and debt overhang, price instability and low production, geopolitical tension and climate change mitigation and adaption actions.

From a financial reporting perspective, the known and estimable effects of the global economic events have been captured in these financial statements for the year ended 31 December 2024, and the Bank reported Net Income before distribution approved by the Board of Governors of UA 354.41 million compared with UA 406.05 million in 2023, representing 12.72 percent decrease.

As global monetary authorities continue to ease policy rates, due to disinflation, interest income and expenses are expected to trend downward in the coming years. For 31 December 2024, however, total interest income from loans and treasury investments continued its upward trend, jumping by 18.95 percent to UA 1,844.35 million, while interest expenses on borrowings increased by 17.71 percent to UA 1,402.74 million. As a result, Net Interest Income for 31 December 2024 had a 23.06 percent increase.

As relative market volatility continues, fair value losses on borrowings and related derivatives increased by 113.13 percent to losses of UA 7.81 million in December 2024 compared with gains in 2023. Similarly, the net realized and unrealized fair value gains from trading treasury investments declined 31.94 percent to UA 80.73 million in December 2024.

Accordingly, the Bank will continue to monitor and take appropriate actions to manage its business and financial risks, apply risk management adjustments on its exposures, and report the effects of the evolution of geopolitical tensions and market conditions in its financial statements as they become known and estimable.

**NOTE C—RISK MANAGEMENT POLICIES AND PROCEDURES**

In carrying out its development mandate, the Bank seeks to maximize its capacity to assume core business risks resulting from its lending and investing operations while at the same time minimizing its non-core business risks (market risk, counterparty risk, liquidity risk, staff benefit plans risk and other operational risk) that are incidental but nevertheless unavoidable in the execution of its mandate.

Risk Governance and Risk Appetite

The highest level of risk management oversight in the Bank is assured by the Board of Executive Directors, which is chaired by the President. The Board of Directors is committed to the highest standards of corporate governance. In addition to approving all risk management policies, the Board of Directors regularly reviews trends in the Bank's risk profile and performance to ensure compliance with the underlying policies.

Four management-level committees perform monitoring and oversight roles: The Asset and Liability Management Committee (ALCO), the Credit Risk Committee (CRC), the Operations Committee (OPSCOM), and the Operational Risk Management Committee (ORMC). The ALCO is the oversight and control organ of the Bank's finance and treasury risk management activities. It is the Bank's most senior management forum on finance and treasury risk management issues and is chaired by the Vice President for Finance and Chief Financial Officer.

The Credit Risk Committee is chaired by the Group Chief Risk Officer and ensures effective implementation of the Bank's credit policies and oversees all credit risk issues related to sovereign and non-sovereign operations. The Operations Committee is chaired by the Senior Vice President and reviews all operational activities before they are submitted to the Board of Directors for approval. The Operational Risk Management Committee, co-chaired by the Vice President of the Technical Corporate Services Complex and the Group Chief Risk Officer, is a committee of representative business units across the Bank that exercises oversight over the Operational Risk Management Framework (ORMF) implementation process. It provides a forum to facilitate

monitoring, discussing and deciding on issues with policy implications related to operational risk management. The Operational Risk Management Committee reports to Senior Management and subsequently to the Board of Directors (if necessary) on any significant operational risk issues that require top management attention.

The ALCO, CRC, and OPSCOM meet on a regular basis to perform their respective oversight roles. Among other functions, the ALCO reviews regular and ad-hoc finance and treasury risk management reports, financial products and financial projections and approves proposed strategies to manage the Bank's balance sheet. The CRC is responsible for end-to-end credit risk governance, credit assessments, portfolio monitoring, and rating change approval, among other responsibilities. The ALCO and the CRC are supported by several standing working groups that report on specific issues including country risk, non-sovereign credit risk, interest rate risk, currency risk, financial projections, and financial products and services.

The Group Chief Risk Officer, who reports directly to the President of the Bank, is charged with oversight of all credit, market, and operational risk issues. However, the day-to-day operational responsibility for implementing the Bank's financial and risk management policies and guidelines is delegated to the appropriate business units. The Financial Management Department and the office of the Group Chief Risk Officer are responsible for monitoring day-to-day compliance with those policies and guidelines. Day-to-day risks are managed through the three-lines-of-defense approach in which business units as primary risk takers constitute the first line of defense. The risk department act as the second line of defense and the audit department acts as the third line of defense.

The degree of risk the Bank is willing to assume to fulfill its development mandate is limited by its risk-bearing capacity. This institutional risk appetite is embodied in the Bank's Risk Appetite Statement, which articulates its commitment to maintain a prudent risk profile consistent with the highest credit rating. The Bank allocates its risk capital between non-core risks (up to 10 percent) and core risks. Non-core risks include; market risk, and counterparty credit risks from treasury investment activities; staff benefit plan risks; and operational risk. Core risks are related to the Bank's lending activities (sovereign and non-sovereign credit risk,). The capital allocation for non-sovereign operations is up to 45 percent of the Bank's risk capital. The Bank revises its credit risk model and inputs into the credit risk model in response to changes in risk and business environment in line with its credit risk management policies, model risk management framework and governance control. Any changes are reflected prospectively from the date the revision to the credit risk model or input takes effect.

Policy Framework

The policies, processes, and procedures by which the Bank manages its risk profile continually evolve in response to market, credit, product, and other developments. The guiding principles by which the Bank manages its risks are governed by the Bank's Risk Appetite Statement, the Long-Term Financial Sustainability Framework, the Capital Adequacy Policy, the General Authority on Asset and Liability Management (the ALM Authority), the General Authority on the Bank's Financial Products and Services (the FPS Authority), and the Bank's Credit Policy and associated Credit Risk Management Guidelines.

The ALM Authority is the overarching framework through which Management has been vested with the authority to manage the Bank's financial assets and liabilities within defined parameters. The ALM Authority sets out the guiding principles for managing the Bank's interest rate risk, currency exchange rate risk, liquidity risk, authorized transactions, counterparty credit risk and operational risk. The ALM Authority covers the Bank's entire array of ALM activities such as debt-funding operations and investment of liquid resources, including the interest rate and currency risk management aspects of the Bank's lending and equity investment instruments.

The FPS Authority provides the framework under which the Bank develops and implements financial products and services for its borrowers, and separate guidelines prescribe the rules governing the management

of credit and operational risk for the Bank's sovereign and non-sovereign loan, guarantee, and equity investment portfolios.

Under the umbrella of the FPS Authority and the ALM Authority, the President is authorized to approve and amend more detailed operational guidelines, as necessary, upon the recommendations of the Asset and Liability Management Committee (ALCO), the Credit Risk Committee (CRC), and the Operations Committee (OPSCOM).

The following sections describe in detail the manner in which the different sources of risk are managed by the Bank.

Credit Risk

Credit risk arises from the inability or unwillingness of counterparties to discharge their financial obligations. It is the potential for financial loss due to default of one or more debtors/obligors. Credit risk is by far the largest source of risk for the Bank arising essentially from its development lending and treasury operations.

The Bank manages three principal sources of credit risk: (i) sovereign credit risk in its public sector portfolio, (ii) non-sovereign credit risk in its portfolio of its private sector borrowers' exposures, and (iii) counterparty credit risk in its portfolio of treasury investments and derivative transactions used for asset and liability management purposes. These risks are managed within an integrated framework of credit policies, guidelines, and processes, which are described in more detail in the sections that follow.

The Bank's maximum exposure to credit risk before collateral received and other credit enhancements for 31 December 2024 and 31 December 2023 is as follows.

Maximum exposure to credit risk (UA thousands)

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| | | |
|:---|:---|:---|
| **Assets** | **2024** | **2023** |
| Cash | 859306 | 1383149 |
| Demand obligations | 1146 | 1146 |
| Treasury investments at fair value | 4899390 | 4481799 |
| Treasury investments at amortized cost | 9471952 | 7900861 |
| Derivative assets | 863319 | 895351 |
| Accrued income and charges receivable on loans | 755654 | 641739 |
| Other accounts receivable | 892607 | 1188638 |
| Loans | 23691207 | 22021408 |

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1) Sovereign Credit Risk

When the Bank lends to borrowers from its public sector window, it generally requires a full sovereign guarantee or the equivalent from the borrowing member country. In extending credit to sovereign entities, the Bank is exposed to country risk which includes potential losses arising from a country's inability or unwillingness to service its obligations to the Bank.

The Bank manages country credit risk through its policies related to the quality at entry of project proposals and, exposure management, including individual country exposure and overall creditworthiness of the concerned country. The Bank also applies a sanctions policy that imposes severe restrictions on countries that fail to honor their obligation to the Bank.

The foundation of the Bank's sovereign credit risk management is a systematic credit risk assessment framework that builds on scoring models and their associated risk factors that have been optimized for the predictive power of the rating parameters and for better alignment with widely used rating scales. The Bank

measures credit risk using a 22-grade rating scale that is calibrated against probabilities of default using the master rating scale developed for the Global Emerging Markets Risk Database (GEMs) consortium.

The Bank recently reviewed its sovereign rating framework, and the revised framework was implemented in June 2024. The Bank's sovereign credit ratings, which are used for country creditworthiness assessment, are derived from an assessment of six risk indices covering macroeconomic performance, debt sustainability, socio-political factors, business environment and the payment track record with the Bank and arrears on external debt. These six risk indices are combined to derive a composite country risk index which is translated into credit risk ratings for sovereign counterparties. The CRC reviews the country ratings on a quarterly basis to ensure that they reflect the expected risk profiles of the countries. The CRC also assesses whether the countries comply with their country exposure limits and approves changes in loss provisioning, if required.

The following table presents the Bank's internal measurement scales compared with the international rating scales.

Internal rating scale equivalent

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| | | | | |
|:---|:---|:---|:---|:---|
| | | **International ratings** | **International ratings** | **International ratings** |
| <br>**Risk Class** | <br>**Revised rating scale** | **S&P – Fitch** | **Moody's** | **Assessment** |
| **Very Low Risk** | 1+ | A+ and above | A1 and above | Excellent |
| **Very Low Risk** | 1 | A | A2 | Excellent |
| **Very Low Risk** | 1- | A- | A3 | Excellent |
| **Very Low Risk** | 2+ | BBB+ | Baa1 | Strong |
| **Very Low Risk** | 2 | BBB | Baa2 | Strong |
| **Very Low Risk** | 2- | BBB- | Baa3 | Strong |
| **Low Risk** | 3+ | BB+ | Ba1 | Good |
| **Low Risk** | 3 | BB | Ba2 | Good |
| **Low Risk** | 3- | BB- | Ba3 | Good |
| **Moderate Risk** | 4+ | B+ | B1 | Satisfactory |
| **Moderate Risk** | 4 | B | B2 | Satisfactory |
| **Moderate Risk** | 4- | B | B2 | Satisfactory |
| **Moderate Risk** | 5+ | B- | B3 | Acceptable |
| **Moderate Risk** | 5 | B- | B3 | Acceptable |
| **High Risk** | 5- | CCC+ | Caa1 | Marginal |
| **High Risk** | 6+ | CCC+ | Caa1 | Marginal |
| **High Risk** | 6 | CCC | Caa2 | Special Attention |
| **High Risk** | 6- | CCC | Caa2 | Special Attention |
| **Very High Risk** | 7 |  |  |  |
| **Very High Risk** | 8 | CCC- | Caa3 | Substandard |
| **Very High Risk** | 9 | CC | Ca | Doubtful |
| **Very High Risk** | 10 | C | C | Loss |

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Preferred Credit Treatment

In addition to the review of sovereign risk factors and recalibration of the sovereign rating model, the revised sovereign rating framework introduced a methodology in 2024 to account for Preferred Creditor Treatment (PCT) rating uplift which has been utilized in the Bank's Capital Adequacy and Expected Credit Loss (IFRS 9) analysis. The PCT methodology reflects analysis based on rating agency and GEMs sovereign default rates and country-specific considerations and will be subject to ongoing review to consider alternative approaches to incorporating PCT in future.

Portfolio Risk Monitoring

The weighted average risk rating of the Bank's sovereign and sovereign-guaranteed portfolio was 2.55 at the end of 31 December 2024, compared with 3.20 as of 31 December 2023. The improvement of the weighted average risk rating is mainly due to the incorporation of the PCT rating uplift methodology in the derivation of the Bank's risk's metrics following the revision of the Bank's sovereign rating framework in 2024.

The table below shows the breakdown of the Bank's sovereign portfolio across the five risk categories.

Risk profile of the sovereign portfolio

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Year** | **Very low risk** | **Low risk** | **Moderate risk** | **High risk** | **Very high risk** |
| 2024 | 38% | 19% | 35% | 7% | 1% |
| 2023 | 39% | 21% | 30% | 9% | 1% |
| 2022 | 40% | 19% | 34% | 6% | 1% |
| 2021 | 34% | 18% | 39% | 8% | 1% |
| 2020 | 39% | 18% | 31% | 11% | 1% |

---

Under the Bank's sanctions policy, if the payment of principal, interest or other charges with respect to any Bank Group sovereign guaranteed credit becomes 30 days overdue, no new loans to that member country, or to any public sector borrower in that country, will be presented to the Board of Directors for approval, nor will any previously approved loan be signed, until all arrears are cleared. Furthermore, for such countries, disbursements on all loans to or guaranteed by that member country are suspended until all overdue amounts have been paid. These countries also become ineligible in the subsequent billing period for a waiver of 0.5 percent on the commitment fees charged on qualifying undisbursed loans.

Although the Bank benefits from the advantages of its preferred creditor status and rigorously monitors the exposure on non-performing sovereign borrowers, some countries have experienced difficulties in servicing their debts to the Bank on a timely basis.

To cover potential unexpected losses related to credit, the Bank maintains a prudent risk capital cushion for credit risks. The Bank's capital adequacy policy articulates differentiated risk capital requirements for public sector and private sector credit-sensitive assets, as well as for contingent liabilities (guarantees and client risk management products) in each risk class.

Risk capital requirements are generally higher for private sector operations which have a higher probability of default and loss given default than public sector operations. At the end of December 2024, the Bank's sovereign loan and guarantee portfolio used up to 26.10 percent (2023: 33.7 percent) of the Bank's total risk capital based on the Bank's capital adequacy framework. The Bank defines risk capital as the sum of paid-in capital net of exchange adjustments, plus accumulated reserves adjusted by gains (or losses) on financial as- sets at FVOCI, unrealized gains or losses on borrowings at FVTPL arising from "own credit" and any shortfall of the stock of provisions to credit losses. Callable capital is not included in the computation of risk capital.

2) Non-Sovereign Credit Risk

When the Bank lends to borrowers in the private sector, it does not benefit from sovereign guarantees. The Bank may also provide financing to creditworthy commercially oriented entities that are publicly owned, without a sovereign guarantee.

To assess the credit risk of non-sovereign projects or facilities, the Bank uses several models to score the risk of every project at entry. These models are tailored to the characteristics and nature of the transactions and the outputs are mapped to the Bank's credit risk rating scale.

Non-sovereign transactions are grouped into four main categories: project finance; corporate finance; financial institutions and private equity funds. The weighted-average risk rating was 3.73 at the end of December 2024 compared with 4.09 at the end of 2023.

The distribution of the non-sovereign portfolio across the Bank's five credit risk classes is shown in the table below.

Risk profile of the non-sovereign portfolio

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Year** | **Very low risk** | **Low risk** | **Moderate risk** | **High risk** | **Very high risk** |
| 2024 | 16% | 27% | 31% | 17% | 10% |
| 2023 | 19% | 17% | 31% | 19% | 14% |
| 2022 | 18% | 16% | 34% | 14% | 18% |
| 2021 | 9% | 19% | 43% | 12% | 17% |
| 2020 | 17% | 21% | 36% | 15% | 11% |

---

To cover potential unexpected credit-related losses due to extreme and unpredictable events, the Bank maintains a risk capital cushion for non-sovereign credit risks derived from the Bank's Economic Capital model which uses internally developed risk parameters (internal rating based).

At the end of December 2024, the non-sovereign portfolio risk capital percentage of the Banks total on- balance sheet risk capital sources was 12.80 percent (2023: 14.2 percent). For the components of non- sovereign portfolio, loans and guarantees risk capital was approximately 4.8 percent (2023: 4.9 percent) while the equity participations risk capital was approximately 8.04 percent (2023: 9.3 percent) of the Bank's total on-balance sheet risk capital sources. This is below the internal limit of 15 percent established by the Board of Governors for equity participation.

Credit Exposure Limits

The Bank operates a system of exposure limits to ensure an adequately diversified portfolio at any given time. The Bank manages credit risk at the global country exposure limit (combined sovereign-guaranteed and non-sovereign portfolios) by ensuring that in aggregate, the total risk capital utilization of any country does not exceed 15 percent of the Bank's total risk capital. The Bank also has a limit of 11.25 percent for capital utilization rate per sector. These thresholds and other determinants of country limits are articulated in the Bank's capital adequacy framework and Risk Appetite Statement.

The credit exposure on the non-sovereign portfolio is further managed by regularly monitoring the exposure limit with regard to the specific industry/sectors, equity investments and single obligor. In addition, the Bank generally requires a range of collateral (security and/or guarantees) from project sponsors to partially mitigate the credit risk for direct private sector loans.

Country Exposure in Borrowing Member Countries

The Bank's exposures as at 31 December 2024 and 31 December 2023 from its lending activities to borrowing member countries as well as from the private sector projects in those countries are summarized below.

Summary of loans as at 31 December 2024 (UA thousands)

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Country** | **Number of <br> loans\*** | **Total loans\*** | **Unsigned <br> loan <br> amounts** | **Undisbursed <br> balance** | **Outstanding <br> balance— <br> gross** | **% of total <br> outstanding <br> loans** |
| Algeria | 1 | 549880 |  |  | 549880 | 2.27 |
| Angola | 12 | 1573523 | 185439 | 457359 | 930725 | 3.85 |
| Benin | 6 | 391231 | 60272 | 273359 | 57600 | 0.24 |
| Botswana | 5 | 622914 |  |  | 622914 | 2.57 |
| Burkina Faso | 3 | 93732 |  | 69589 | 24143 | 0.10 |
| Cabo Verde | 18 | 218667 |  | 12447 | 206220 | 0.85 |
| Cameroon | 21 | 1726553 | 31581 | 836793 | 858179 | 3.55 |
| Republic of the Congo | 6 | 403142 |  | 69683 | 333459 | 1.38 |
| Côte d'Ivoire | 20 | 1399326 | 19632 | 518987 | 860707 | 3.56 |
| Egypt | 22 | 2272193 | 39846 | 300334 | 1932013 | 7.99 |
| Equatorial Guinea | 5 | 73929 |  | 48860 | 25069 | 0.10 |
| Eswatini | 11 | 490464 | 107811 | 208684 | 173969 | 0.72 |
| Ethiopia | 2 | 132320 |  | 48830 | 83490 | 0.35 |
| Gabon | 12 | 886257 |  | 228073 | 658184 | 2.72 |
| Kenya | 21 | 1829763 | 125429 | 449660 | 1254674 | 5.19 |
| Mauritius | 9 | 797051 |  | 84347 | 712704 | 2.95 |
| Morocco | 71 | 4528186 | 179070 | 1039380 | 3309736 | 13.68 |
| Namibia | 12 | 991315 |  | 246718 | 744597 | 3.08 |
| Nigeria | 19 | 2552694 | 115019 | 801827 | 1635848 | 6.76 |
| Rwanda | 9 | 782823 | 76679 | 448349 | 257795 | 1.07 |
| Senegal | 28 | 1586112 | 109628 | 607311 | 869173 | 3.59 |
| Seychelles | 9 | 117347 |  | 261 | 117086 | 0.48 |
| South Africa | 11 | 2040385 |  | 508532 | 1531853 | 6.33 |
| Tanzania | 13 | 1311341 | 99461 | 548797 | 663083 | 2.74 |
| Tunisia | 42 | 2537793 | 63883 | 634900 | 1839010 | 7.60 |
| Uganda | 11 | 854039 | 137778 | 418404 | 297857 | 1.23 |
| Zambia | 10 | 419853 |  | 78234 | 341619 | 1.41 |
| Zimbabwe\*\* | 12 | 209908 |  |  | 209908 | 0.87 |
| Multinational | 4 | 270296 | 174250 | 96046 |  |  |
| **Total public sector** | **425** | **31663037** | **1525778** | **9035764** | **21101495** | **87.23** |
| **Total private sector** | **140** | **5239018** | **1414325** | **734431** | **3090262** | **12.77** |
| **Total** | **565** | **36902055** | **2940103** | **9770195** | **24191757** | **100.00** |

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*\* Excludes fully repaid loans and cancelled loans. Trade finance and related guarantee exposures are also excluded.*

*\*\* Countries in non-accrual status as at 31 December 2024.*

Summary of loans as at 31 December 2023 (UA thousands)

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Country** | **Number of <br> loans\*** | **Total loans\*** | **Unsigned <br> loan <br> amounts** | **Undisbursed <br> balance** | **Outstanding <br> balance— <br> gross** | **% of total <br> outstanding <br> loans** |
| Algeria | 1 | 616001 |  |  | 616001 | 2.71 |
| Angola | 10 | 1420006 |  | 604936 | 815070 | 3.58 |
| Benin | 5 | 341096 | 53259 | 251897 | 35940 | 0.16 |
| Botswana | 5 | 680336 |  | 133908 | 546428 | 2.40 |
| Burkina Faso | 3 | 96737 |  | 79207 | 17530 | 0.08 |
| Cabo Verde | 17 | 222323 |  | 21323 | 201000 | 0.88 |
| Cameroon | 21 | 1816061 | 312177 | 683975 | 819909 | 3.60 |
| Republic of the Congo | 6 | 424771 |  | 81983 | 342788 | 1.51 |
| Côte d'Ivoire | 18 | 1328298 |  | 610914 | 717384 | 3.15 |
| Egypt | 21 | 2404730 | 163346 | 151824 | 2089560 | 9.19 |
| Equatorial Guinea | 5 | 78143 |  | 55799 | 22344 | 0.10 |
| Eswatini | 12 | 378405 | 84324 | 141055 | 153026 | 0.67 |
| Ethiopia | 2 | 130975 |  | 60004 | 70971 | 0.31 |
| Gabon | 13 | 975265 |  | 266989 | 708276 | 3.11 |
| Kenya | 20 | 1742740 | 187593 | 448427 | 1106720 | 4.86 |
| Mauritius | 8 | 629726 |  | 81987 | 547739 | 2.41 |
| Morocco | 68 | 4468578 | 328242 | 674658 | 3465678 | 15.23 |
| Namibia | 13 | 1025876 | 148517 | 105943 | 771416 | 3.39 |
| Nigeria | 18 | 2103613 | 134161 | 729521 | 1239931 | 5.45 |
| Rwanda | 8 | 730649 | 151762 | 337541 | 241346 | 1.06 |
| Senegal | 25 | 1541983 |  | 737762 | 804221 | 3.54 |
| Seychelles | 8 | 99515 | 24596 | 1225 | 73694 | 0.32 |
| South Africa | 10 | 1385124 |  | 184696 | 1200428 | 5.28 |
| Tanzania | 11 | 1107988 | 49192 | 621553 | 437243 | 1.92 |
| Tunisia | 42 | 2669245 | 67267 | 669902 | 1932076 | 8.49 |
| Uganda | 10 | 794030 | 133923 | 406266 | 253841 | 1.12 |
| Zambia | 10 | 350521 |  | 91231 | 259290 | 1.14 |
| Zimbabwe\*\* | 12 | 204035 |  |  | 204035 | 0.90 |
| Multinational | 3 | 192587 | 192587 |  |  |  |
| **Total public sector** | **405** | **29959357** | **2030946** | **8234526** | **19693885** | **86.57%** |
| **Total private sector** | **139** | **4909324** | **1123888** | **730137** | **3055299** | **13.43%** |
| **Total** | **544** | **34868681** | **3154834** | **8964663** | **22749184** | **100.00%** |

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*\* Excludes fully repaid loans and cancelled loans. Trade finance and related guarantee exposures are also excluded.*

*\*\* Countries in non-accrual status as at 31 December 2023.*

Balance Sheet Optimization Initiatives

The African Development Bank has been at the forefront of financial innovation to optimize its balance sheet and increase its financial capacity since 2015. The Bank continues to pioneer Balance Sheet Optimization (BSO) initiatives to mobilize additional financial resources and play its countercyclical financing role. The Bank's drive for innovation was endorsed in the Independent Review of Capital Adequacy Frameworks (The CAF Review) commissioned by the G20 Finance Ministers to scale up MDB financing.

The BSO policy framework approved in June 2020 concretizes the objectives of risk transfer transactions with the Bank as (i) reducing concentration risk on the Bank's sovereign and/or non-sovereign loan and/ or guarantee portfolios; (ii) diversifying and crowding in investors into ESG and development finance and (iii) increasing the institution's lending headroom. BSO initiatives involve the purchase of credit protection on defined sovereign and non-sovereign exposures, through Exposure Exchange Agreements (EEAs), credit insurance and guarantee transactions, among other instruments.

Since the execution of the first transaction in 2015, BSO has become a valuable tool for creating lending headroom to facilitate the Bank's ability to meet client expectations.

Balance Sheet Optimization Initiatives—Sovereign

In this section, BSO initiatives transacted for the benefit of sovereign obligors are discussed. Similar transactions impacting non-sovereign credit exposures are described under Non-Sovereign Credit Risk.

Exposure Exchange Agreement

The first sovereign BSO transaction completed by the Bank was under the EEA. This multi-peer risk sharing framework was established as part of efforts at the time to reduce sovereign concentration risk and increase lending headroom among MDBs. The EEA involves a simultaneous exchange of equivalent credit risk on defined reference portfolios of sovereign exposures, subject to each participating MDB retaining a minimum of 50 percent of the total exposure to each country that is part of the EEA. At the time of each individual transaction, the parties sign Confirmation Schedules reflecting the proposed portfolios to be exchanged and the relevant maturities. Under the EEA, the MDB that originates the sovereign loans and buys protection continues to be the lender of record. Thus, the counterparty credit exposure that can arise from the purchase or sale of protection under the MDB exposure exchange is limited, given the AAA credit ratings of the Bank's counterparties.

The first Confirmation Schedules were concluded in 2015 between the African Development Bank, the Inter-American Development Bank (IADB) and the World Bank (IBRD), all AAA-rated entities. These inaugural Confirmation Schedules have a final maturity in 2030 with linear annual reduction of the notional amounts starting from 2025. Eight years later, on July 2023, the Bank finalized another Confirmation Schedule of a USD 1 billion with the Asian Development Bank (AsDB) under the EEA framework for 15 years maturing in July 2038 to further enhance Bank headroom available to high-risk countries. On 25 October 2024, the Bank also finalized another USD 1billion with the AsDB aimed at enhancing the Bank's capacity for sustainable lending across Africa.

The EEA in no way affects the application of normal sovereign sanctions policies by the buyer of protection. Purchased or sold credit protection pays out only upon the occurrence of certain credit events with respect to any sovereign borrower in the reference portfolio. When the default event is resolved, payments made under the EEA are returned to the seller of protection. To date, no such credit events have occurred.

The Bank accounts for exposures and rights arising from the EEA and similar transactions as financial guaran- tee contracts, in accordance with IFRS 9, as described in Note B.

The table below presents the countries and notional amounts of credit protection contracted under the various Confirmation Schedules governed by the EEA.

Summary of Exposure Exchange Agreements (USD millions)

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| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Protection purchased** | **Protection purchased** | **Protection purchased** | **Protection purchased** | **Protection purchased** | **Protection purchased** | **Protection sold** | **Protection sold** | **Protection sold** | **Protection sold** | **Protection sold** | **Protection sold** |
| **World Bank** | **World Bank** | **Inter-American<br> Development Bank** | **Inter-American<br> Development Bank** | **Asia <br> Development Bank** | **Asia <br> Development Bank** | **World B** **ank** | **World B** **ank** | **Inter-American <br> Development Bank** | **Inter-American <br> Development Bank** | **Asia <br> Developent Bank** | **Asia <br> Developent Bank** |
| Angola | 213.71 | Angola | 85.00 | Angola | 150.00 | Albania | 126.00 | Argentina | 750.00 | Bangladesh | 547.00 |
| Botswana | 225.00 | Egypt | 720.00 | Cameroon | 234.00 | China | 128.18 | Brazil | 820.00 | India | 347.00 |
| Gabon | 150.00 | Morocco | 990.00 | Congo | 100.00 | India | 450.00 | Ecuador | 303.20 | Pakistan | 250.00 |
| Namibia | 49.00 | Nigeria | 95.00 | Egypt | 110.00 | Indonesia | 475.32 | Mexico | 800.00 | Mongolia | 416.00 |
| Nigeria | 100.00 | Tunisia | 990.00 | Gabon | 184.00 | Jordan | 13.00 | Panama | 206.80 | Philippines | 309.00 |
| South Africa | 850.00 |  |  | Morocco | 520.00 | Pakistan | 10.21 |  |  | Indonesia | 55.00 |
|  |  |  |  | Senegal | 215.00 | Romania | 185.00 |  |  | Uzbekistan | 76.00 |
|  |  |  |  | Côte <br> d'Ivoire | 284.00 | Türkiye | 200.00 |  |  |  |  |
|  |  |  |  | Kenya | 86.00 |  |  |  |  |  |  |
|  |  |  |  | Tanzania | 117.00 |  |  |  |  |  |  |
| **TOTAL** | **1587.71** | **TOTAL 2** | **,880.00** | **TOTAL 2** | **,000.00** | **TOTAL** | **1587.71** | **TOTAL 2** | **,880.00** | **TOTAL** | **2000.00** |

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Sovereign Portfolio Credit Insurance

The Bank has purchased credit insurance protection cover on the obligations of one or more of its sovereign borrowers. In 2022, the Bank executed a portfolio-based credit insurance transaction, Room 2 Run Sovereign with the UK's Foreign Commonwealth and Development Office and three private insurers from the Lloyd's market, providing the Bank with an estimated additional USD 2 billion in new lending capacity for climate finance. The transaction increased the efficient use of the Bank's risk capital by hedging its portfolio credit risk and creating additional headroom for the Bank's operations in order to improve the overall risk profile of the Bank's assets. The Bank remains the lender of record of the covered sovereign loans and guarantees in the reference portfolio and expects full recovery of its sovereign and sovereign-guaranteed exposures covered in the remote case of a default. This notwithstanding, no default events have occurred on any sovereign exposures covered as of 31 December 2024.

The transaction notably improves the risk profile of the Bank's portfolio, while enhancing its risk bearing capacity.

Insurance at Origination for Single Sovereign Obligors

In 2023, the BSO strategy accelerated deployment of insurance at origination on sovereign assets. This approach has allowed the Bank to increase its relevance to clients seeking to mobilize sustainable financing from commercial lenders and the capital markets. The Bank approved a Partial Credit Guarantee (PCG) of USD 345 million equivalent in renminbi to facilitate Egypt's inaugural issuance of a Sustainability Panda Bond of approximately USD 500 million to finance ESG projects under the country's Sovereign Sustainable Financing Framework. This was the first ever Panda Bond issued in China by an African sovereign and crowded in capacity by private insurers.

The Bank also provided a EUR 400 million PCG in support of the mobilization of a EUR 533 million 15-year ESG loan to the Government of Côte d'Ivoire. In this transaction, the Bank collaborated with the insurance arm of the Islamic Development Bank (Islamic Corporation for the Insurance of Investment and Export Credit), another founding member of the Co-Gurantee Platform, to back the Bank's participation with EUR

194 million. This enabled the Bank to provide the full EUR 400 million guarantee cover representing an 80 percent AAA credit enhancement to the lender. This translated to optimal financing for the government in terms of loan pricing at the required tenor.

Overall, the total notional amount of credit protection, including insurance, purchased or sold, on the under- lying single referenced sovereign entities rose to UA 5.01 billion (USD 6.54 billion) as at 31 December 2024 and UA 4.13 billion (USD 5.54 billion) as at 31 December 2023.

Balance Sheet Optimization Initiatives—Non-sovereign

As in the case of sovereign credit exposures, the Bank has entered into BSO initiatives covering its non- sovereign loan and guarantee portfolio aimed at (i) mobilizing institutional investment, (ii) addressing con- centration and other prudential ratio limits, and (iii) increasing lending headroom. These initiatives involve, among other structured finance approaches, assets sell downs, credit insurance, financial guarantees, and synthetic securitization structures, on defined non-sovereign exposures. Under the BSO credit protection purchased on its non-sovereign credit exposures, the Bank will be compensated for losses arising from credit default by the counterparty in the reference non-sovereign portfolio. As the originator of the qualifying transactions and as protection buyer, the Bank remains the lender of record. In line with the substance, the transactions are accounted for as financial guarantee contracts. Accordingly, the cash flow expected from the purchased BSO credit protection or financial guarantee contract is included in the measurement of ECLs of loan (if certain conditions are met), with the effect of improving ECLs reported in the financial statements of the Bank.

Specific BSO initiatives undertaken by the Bank covering its non-sovereign obligors are described below.

Private Sector Credit Enhancement Facility

The Bank enters into risk participation agreements for the primary purpose of promoting Private Sector Operations in certain countries by inviting other entities to participate in the risks of such Private Sector Operations. The PSF is one of such initiatives.

The Private Sector Credit Enhancement Facility (PSF) was established in 2015, as an independent special purpose vehicle managed by the African Development Fund, to absorb risk on selected non-sovereign loans issued by the Bank in low-income countries at origination. The PSF is operated to maintain a risk profile equivalent to an investment-grade rating and absorbs risk using a risk participation agreement structure. The Bank has purchased credit enhancement from the PSF for some of its non-sovereign loans. As at 31 December 2024, the notional amounts of non-sovereign loans covered by the PSF stood at UA 245.87 million (31 December 2023: UA 249.32 million).

Non-Sovereign Synthetic Securitization and Portfolio Credit Insurance

In 2018, the Bank launched its now well-known Room 2 Run program as a subset of its BSO initiatives. Within the Room 2 Run umbrella, two pioneering portfolio-based transactions were executed in support of easing prudential limits on the non-sovereign portfolio and crowding in institutional investors. The initial transaction was the USD 1 billion synthetic securitization which has grown to a cumulative credit insurance portfolio balance of USD 2 billion as at 31 December 2024. The Room 2 Run synthetic securitization transaction (R2R-SST) transaction was terminated on 30 June 2024, while the Room 2 Run Credit insurance transaction (R2R-CI) transaction had an effective termination date of 14 January 2025.

Portfolio Guarantees

On September 2022, the Bank signed the Lusophone Compact Guarantee with the Government of Portugal for EUR 400 million in support of private sector projects in Portuguese-speaking countries in Africa. The Lusophone Compact Guarantee with a maturity of 15 years allows the Bank to receive cover on single obligor credit on non-sovereign transactions in eligible countries for up to 85 percent of the principal on an on-demand basis.

Insurance at Origination for Non-sovereign Single Obligors

The overall total notional outstanding exposure of all relevant underlying single and portfolio-based non- sovereign reference entities covered by BSOs stood at UA 1.98 billion as at 31 December 2024 (31 December 2023: UA 2.06 billion).

The BSO fees are generated through operational activities and netted off against the Bank's loan income (see note N), they are not included in the administrative expenses. The total BSO expenses for the year amounted to UA 13.84 million (2023: UA 15.61 million).

3) Counterparty Credit Risk

In the normal course of business, and beyond its development-related exposures, the Bank utilizes various financial instruments to meet the needs of its borrowers, manage its exposure to fluctuations in market interest and currency rates, and temporarily invest its liquid resources prior to disbursement. All of these financial instruments involve, to varying degrees, the risk that the counterparty to the transaction may be unable to meet its obligation to the Bank. Given the nature of the Bank's business, it is not possible to completely eliminate counterparty credit risk. However, the Bank minimizes this risk by executing hedging transactions within a prudential framework of approved counterparties, minimum credit rating standards, counterparty exposure limits, and counterparty credit risk mitigation measures.

Counterparties must meet the Bank's minimum credit rating requirements and be approved by the Bank's Vice President for Finance and CFO. For local currency operations, less stringent minimum credit rating limits are permitted in order to provide adequate availability of investment opportunities and derivative counterparties for implementing appropriate risk management strategies. The ALCO approves counterparties that are rated below the minimum rating requirements.

Counterparties are classified as investment counterparties, derivative counterparties, and trading counter- parties. Their ratings are closely monitored for compliance with established criteria.

For trading counterparties, the Bank requires a minimum short-term credit rating of A-2/P-2/F-2 for trades settled under delivery versus payment (DVP) terms and a minimum short-term credit rating of A-1/P-1/F-1 for non-DVP-based transactions.

The following table details the minimum credit ratings for authorized investment counterparties by maturity:

Minimum credit ratings for Investments

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Maturity | Maturity | Maturity | Maturity | Maturity | Maturity |
|  | 6 months | 1 year | 5 years | 10 years | 15 years | 30 years |
|  |  | A/A2 |  |  | AA-/Aa3 | AAA/Aaa |
| **Government** | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below | Maximum remaining maturity of 5 years in the trading portfolios <br> and 10 years in the held at amortized cost portfolio for SDR<br> denominated securities rated A+/A1 or below |
| **Government agencies and supranationals** |  | A/A2 |  |  | AA-/Aa3 | AAA/Aaa |
| **Banks** | A/A2 |  | AA-/Aa3 | AAA/Aaa |  |  |
| **Corporations including non-bank financial institutions** | A/A2 |  | AA-/Aa3 | AAA/Aaa |  |  |
| **Mortgage-backed securities (MBS)/ Asset-backed securities (ABS)** | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. | AAA<br> Maximum legal maturity of 50 years. Also, the maximum weighted average life for all ABS/MBS at the time of acquisition shall not exceed 5 years. |

---

The Bank may also invest in money market mutual funds with a minimum rating of AA-/Aa3 and enter into collateralized securities repurchase agreements.

The Bank uses derivatives in the management of its borrowing portfolio and for asset and liability management purposes. As a rule, the Bank executes an International Swaps and Derivatives Association (ISDA) master agreement and netting agreement with its derivative counterparties prior to undertaking any transactions. Derivative counterparties are required to be rated A-/A3 or above by at least two approved rating agencies and must enter into a collateral exchange agreement with the Bank. Lower rated counterparties may be used exceptionally for local currency transactions. These counterparties require ALCO approval. Approved transactions with derivative counterparties include swaps, forwards, options and other over-the-counter derivatives.

Daily collateral exchanges enable the Bank to maintain net exposures to acceptable levels. The Bank's derivative exposures and their credit rating profiles are shown in the tables below.

Derivative exposures and their credit rating profiles

*(UA millions)*

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Derivatives** | **Derivatives** | **Derivatives** | **Credit risk profile of net exposure** | **Credit risk profile of net exposure** | **Credit risk profile of net exposure** |
| | **Notional <br> amount** | **Fair value\*** | **Net exposure\*\*** | **AAA** | **AA+ to AA-** | **A+ and lower** |
| 2024 | 36290 | 151 | 33 |  | 11% | 89% |
| 2023 | 34086 | 127 | 40 |  |  | 100% |
| 2022 | 36803 | 104 | 15 |  |  | 100% |
| 2021 | 38502 | 295 | 28 |  | 1% | 99% |
| 2020 | 29804 | 884 | 115 |  | 1% | 99% |

---

*\* Fair value before collateral.*

*\*\* After collateral received in cash or securities.*

In addition to the minimum rating requirements for derivative counterparties, the Bank operates within a framework of exposure limits to different counterparties based on their credit rating and size, subject to a maximum of 12 percent of the Bank's total risk capital (equity and reserves) for any single counterparty. Individual counterparty credit exposures are aggregated across all instruments using the Bank for International Settlements potential future exposure methodology and monitored regularly against the Bank's credit limits after considering the benefits of any collateral.

The financial assets and liabilities that are subject to offsetting, enforceable master netting arrangement are summarized below.

Financial assets subject to offsetting, enforceable master netting arrangements and similar agreements

*(UA millions)*

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Gross amounts of recognized financial assets** | **Gross amounts of recognized financial assets set off in the balance sheet** | **Net amounts of financial assets presented in the balance sheet** | **Related amounts not set off in the statement of financial position** | **Related amounts not set off in the statement of financial position** | |
| | **Gross amounts of recognized financial assets** | **Gross amounts of recognized financial assets set off in the balance sheet** | **Net amounts of financial assets presented in the balance sheet** | **Financial instruments** | **Collateral received** | <br>**Net amount** |
| 2024 | 151 |  | 151 |  | (118) | 33 |
| 2023 | 138 | (12) | 127 |  | (89) | 38 |
| 2022 | 144 | (40) | 104 |  | (89) | 15 |
| 2021 | 526 | (280) | 246 |  | (347) | (101) |
| 2020 | 1474 | (590) | 884 |  | (849) | 35 |

---

Financial Liabilities Subject to Offsetting, Enforceable Master Netting Arrangements and Similar Agreements

*(UA millions)*

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Gross amounts of recognized financial assets** | **Gross amounts of recognized financial assets set off in the balance sheet** | **Net amounts of financial assets presented in the balance sheet** | **Related amounts not set off in the statement of financial position** | **Related amounts not set off in the statement of financial position** | |
| | **Gross amounts of recognized financial assets** | **Gross amounts of recognized financial assets set off in the balance sheet** | **Net amounts of financial assets presented in the balance sheet** | **Financial instruments** | **Collateral received** | <br>**Net amount** |
| 2024 | 1597 | (110) | 1487 |  |  | 1487 |
| 2023 | 2115 | (780) | 1335 |  |  | 1335 |
| 2022 | 2754 | (742) | 2012 |  |  | 2012 |
| 2021 | 661 | (279) | 382 |  |  | 382 |
| 2020 | 145 | (41) | 104 |  |  | 104 |

---

The credit exposure of the investment and related derivative portfolio continues to be dominated by highly rated counterparties as shown in the table below.

Credit rating profile of investment and related derivative portfolio

---

| | | | |
|:---|:---|:---|:---|
| | **AAA** | **AA+ to AA-** | **A+ and lower** |
| 2024 | 54% | 27% | 19% |
| 2023 | 53% | 32% | 15% |
| 2022 | 46% | 39% | 15% |
| 2021 | 51% | 36% | 13% |
| 2020 | 54% | 36% | 10% |

---

To cover potential unexpected credit losses due to extreme and unpredictable events, the Bank maintains a conservative risk capital cushion for counterparty credit.

As of 31 December 2024, the capital consumption attributable to the Bank's counterparty credit portfolio including all investments and derivative instruments stood at 3.80 percent (2023: 4.3 percent) of the Bank's total risk capital.

Expected Credit Risk

Definition of Default

The definition of default for the purpose of determining ECLs considers indicators that the debtor is unlikely to pay its material credit obligation to the Bank that is past due for more than 90 days for non-sovereign counterparties and 180 days for sovereign counterparties.

The Bank rebuts the IFRS 9's 90 days past due rebuttable presumption on the Bank's sovereign loan portfolio because the Sanction policy of the Bank defines a non-accrual loan or non-performing loan as a loan that is at least 180 days past due. This is also the current practice in other MDBs.

The Bank considers default from the standpoint that the obligor is unlikely to pay and meets its credit obligations to the Bank without recourse by the Bank to actions such as realizing the obligor's assets or security.

Modifications of Financial Assets and Financial Liabilities

The contractual terms of a loan may be modified for a number of reasons, including changing market conditions, customer retention and other factors not related to a current or potential credit deterioration of the customer. An existing loan whose terms have been modified may be derecognized and the renegotiated loan recognized as a new loan at fair value in accordance with the Bank's accounting policy. When the terms of a financial asset are modified, and the modification does not result in derecognition, the determination of whether the asset's credit risk has increased is based on applicable criteria at the reporting date.

If the terms of a financial asset are modified, the Bank considers whether the cash flows arising from the modified asset are substantially different. If they are substantially different, then the contractual rights to cash flows from the original financial asset are deemed to have expired. In this instance, a new financial asset is recognized at fair value while the original financial asset is derecognized. If the cash flows of the modified asset are not substantially different, then the modification does not result in derecognition of the financial asset. In this case, the Bank recognizes a modification gain or loss in the income statement as the difference between the gross carrying amount prior to the modification and the new gross carrying amount.

Measurement and Recognition of Expected Credit Loss

ECLs are calculated by multiplying three main components: the probability of default (PD), loss given default (LGD) and exposure at default (EAD), discounted at the appropriate effective interest rate (EIR) on the reporting date.

These parameters are generally derived from internally developed statistical models and other historical data. They are adjusted to reflect forward-looking information as described above.

PD estimates are estimates at a certain date, that are calculated based on statistical rating models and assessed using rating tools tailored to the various categories of counterparties and exposures. These statistical models are based on internally compiled data comprising both quantitative and qualitative factors. Where available, market data may also be used to derive the PD for large corporate counterparties. If a counterparty or exposure migrates between ratings classes, this will lead to a change in the estimate of the associated PD.

For accounting purposes, the 12-month and lifetime PD used are the point-in-time forward-looking prob- ability of a default over the next 12 months and remaining lifetime of the financial instrument, respectively, based on conditions existing at the balance sheet date and future economic conditions under different macroeconomic scenario that affect credit risk. The Bank will continue to assess and update the parameters used in the ECL model on an ongoing basis to reflect its loss and recovery experiences and changes in the macroeconomic variables.

LGD is the magnitude of the likely loss if there is a default. The Bank estimates LGD parameters based on the history of recovery rates of claims against defaulted counterparties. The non-sovereign LGD model considers seniority of the claim, whereas sovereign LGDs are driven by rating class and several macroeconomic factors. For non-sovereign stage 3 exposures, LGD estimates are recalibrated for different economic scenarios to reflect possible changes in relevant prices. They are calculated on a discounted cash flow basis using the effective interest rate as the discounting factor.

The Bank's loss given default (LGD) model for the sovereign loans portfolio is in accordance with the global best practices of the sector and the Bank's Model Risk Management (MRM) guidelines. This model allows for a lower dependence on the effective interest rate (EIR) and its high volatility. The LGD model is now based on historical losses observed mainly on the Bank's sovereign portfolio, estimated as the time value of money of the amount in arrears over the default period. This approach to estimate the observed losses captures the Bank's PCT status as no losses on principal and interest due have been observed in the sovereign port- folio. Adjustments, based on a scorecard comprising several macroeconomic factors, are then made to the historical observed losses grouped by ratings to estimate the LGD. This model integrates an estimate of the recovery costs and a floor to capture its value.

In line with the MRM framework, the CRC cleared the implementation of this model. The Bank conducts periodic reviews of this model or whenever a substantial change occurs in the economic environment in line with its model risk management.

EAD represents the expected exposure in the event of a default. The Bank derives the EAD from the current exposure to the counterparty and potential changes to the current amount allowed under the contract including amortization. The EAD of a financial asset is its gross carrying amount. For financial guarantees, the EAD includes the amount drawn, as well as potential future amounts that may be drawn under the contract, which are estimated based on historical observations and forward-looking forecasts. For some financial

assets, EAD is determined by modeling the range of possible exposure outcomes at various points in time using scenario and statistical techniques.

Assessment of Significant Increase in Credit Risk

When determining whether the risk of default has increased significantly since initial recognition, the Bank considers both quantitative and qualitative information and analysis based on the Bank's historical experience and expert credit risk assessment, including forward looking information that is available without undue cost or effort.

Despite the foregoing, the Bank assumes that the credit risk on a financial instrument has not increased significantly since initial recognition if the financial instrument is determined to have low credit risk at the reporting date. The Bank considers a financial asset to have low credit risk when it has an internal or external credit rating of BB-equivalent or better.

The Bank has recently reviewed its criteria for stage classification by improving them to align with industry best practices and IFRS9 standards. The new criteria, driven by rating downgrade notches, are more granular and sensitive. These new criteria were cleared by the CRC and implemented in July 2024.

The Bank regularly monitors the effectiveness of the criteria used to identify whether there has been a significant increase in credit risk and revises them as appropriate to ensure that the criteria are capable of identifying significant increase in credit risk before the amount becomes past due.

Incorporation of Forward-looking Information

The Bank considers a range of three relevant forward-looking macro-economic scenarios (baseline, optimistic and pessimistic) assumptions for the determination of unbiased ECLs. All the risk parameters used to compute the ECLs are approved by the Credit Risk Committee, which consists of senior executives from risk, finance, and operations functions.

Incorporating forward-looking information increases the degree of judgement required as to how changes in these macro-economic factors will affect ECLs. The methodologies and assumptions including any fore- casts of future economic conditions are reviewed regularly.

Calculation of Expected Credit Loss

The Bank calculates ECLs based on three probability-weighted macroeconomic scenarios. The three scenarios are: base case, optimistic and pessimistic. Each of these scenarios is associated with different probability of default parameters and different weight. These parameters are generally derived from internally developed statistical models combined with historical, current and forward-looking macro-economic data.

The Bank recognizes all ECLs in the income statement in the reporting period when it is determined and as an adjustment to the loss allowance account on the balance sheet. When the Bank has measured the loss allowance for a financial instrument at an amount equal to lifetime ECLs in the previous reporting period but determines at the current reporting date that criteria for recognizing the lifetime ECLs is no longer met, it measures the loss allowance at an amount equal to 12-month ECLs at the current reporting period. This determination and subsequent reversal of loss allowance (i.e. write back) is based on the financial instrument being cured and appropriate for the backward transfer.

Amounts Arising from Expected Credit Losses

IFRS 9 requires the recognition of 12-month expected credit losses (the portion of lifetime expected credit losses from default events that are expected within 12 months of the reporting date) if credit risk has not significantly increased since initial recognition (stage 1), and lifetime expected credit losses for financial instruments for which the credit risk has increased significantly since initial recognition (stage 2) or which are credit impaired (stage 3). The exposures are classified in stages based on staging criteria discussed above.

Impairment of Financial Instruments by Stage

The tables below present a breakdown of impairment allowance based on stage allocation and asset classification as at 31 December 2024 and 31 December 2023 and a reconciliation of ECLs allowance recognized in the income statement.

Impairment on loans at amortized costs and other financial instruments by stage

As at 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Loan at amortized cost | 71048 | 126530 | 279386 | 476964 |
| Interest receivables | 4575 | 8017 | 183948 | 196540 |
| Undisbursed loans | 908 | 22677 |  | 23585 |
| Treasury investments | 347 |  |  | 347 |
| Guarantees | 5880 |  |  | 5880 |
| **Total impairment as at 31 December 2024** | **82758** | **157224** | **463334** | **703316** |

---

As at 31 December 2023

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Loan at amortized cost | 123576 | 115154 | 464923 | 703653 |
| Interest receivables | 6032 | 8359 | 216609 | 231000 |
| Undisbursed loans | 2390 | 21733 |  | 24123 |
| Treasury investments | 302 |  |  | 302 |
| Guarantees | 1932 |  |  | 1932 |
| **Total impairment as at 31 December 2023** | **134232** | **145246** | **681532** | **961010** |

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Reconciliation of ECLs allowance recognized in the Income Statement

ECLs impairment on Loan principal for 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Opening 1 January | 123576 | 115154 | 464923 | 703653 |
| (Writeback)/Provision for the year—Income statement | (52528) | 11376 | 28048 | (13104) |
| Write-Off |  |  | (213585) | (213585) |
| **Closing 31 December 2024** | **71048** | **126530** | **279386** | **476964** |
| (Writeback)/Provision for the year 31 December 2023 | (30754) | 18589 | 15097 | 2933 |

---

ECLs impairment on Interest receivables for 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Opening 1 January | 6032 | 8359 | 216609 | 231000 |
| (Writeback)/Provision for the year—Income statement | (1457) | (342) | 5969 | 4170 |
| Write off |  |  | (38630) | (38630) |
| **Closing 31 December 2024** | **4575** | **8017** | **183948** | **196540** |
| Provision for the year 31 December 2023 | 1313 | 4397 | 6792 | 12502 |

---

ECLs impairment on Undisbursed loans for 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Opening 1 January | 2390 | 21733 |  | 24123 |
| (Writeback)/Provision for the year—Income statement | (1482) | 944 |  | (538) |
| **Closing 31 December 2024** | **908** | **22677** | **-** | **23585** |
| (Writeback)/Provision for the year 31 December 2023 | (387) | 3240 |  | 2852 |

---

ECLs impairment on Treasury Investments for 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Opening 1 January | 302 |  |  | 302 |
| Writeback for the year—Income statement | 45 |  |  | 45 |
| **Closing 31 December 2024** | **347** | **-** | **-** | **347** |
| Provision for the year 31 December 2023 | 31 |  |  | 31 |

---

ECLs impairment on Financial Guarantees for 31 December 2024

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Opening 1 January | 1932 |  |  | 1932 |
| Provision for the year—Income statement | 3948 |  |  | 3948 |
| **Closing 31 December 2024** | **5880** | **-** | **-** | **5880** |
| Provision/(Writeback) for the year 31 December 2023 | 1441 | (13) |  | 1428 |

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The table below presents an analysis of loans—sovereign and non-sovereign—at amortized cost by gross exposure, impairment allowance and coverage ratio at 31 December 2024 and 31 December 2023.

Analysis of Loans at amortized cost, impairments and ECLs Coverage ratio<sup>2</sup>

As at 31 December 2024

*(UA millions)*

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Gross exposure** | **Gross exposure** | **Gross exposure** | **Gross exposure** | **Impairment allowance** | **Impairment allowance** | **Impairment allowance** | **Impairment allowance** |
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| **Loan principal** | **19964** | **3745** | **483** | **24192** | **71.05** | **126.53** | **279.38** | **476.96** |
| Non-sovereign | 2192 | 626 | 273 | 3091 | 50.87 | 49.69 | 190.80 | 291.36 |
| Sovereign | 17772 | 3119 | 210 | 21101 | 20.18 | 76.84 | 88.58 | 185.60 |
| **Interest receivables** | **450** | **66** | **399** | **915** | **4.58** | **8.02** | **183.94** | **196.54** |
| Non-sovereign | 62 | 15 | 24 | 101 | 3.77 | 3.51 | 22.06 | 29.34 |
| Sovereign | 388 | 51 | 375 | 814 | 0.81 | 4.51 | 161.88 | 167.20 |
| **Undisbursed loans** | **8949** | **778** | **44** | **9771** | **0.91** | **22.68** | **-** | **23.59** |
| Non-sovereign | 691 |  | 44 | 735 | 0.39 |  |  | 0.39 |
| Sovereign | 8258 | 778 |  | 9036 | 0.52 | 22.68 |  | 23.20 |
| **Total loans and interest receivables** | **29363** | **4589** | **926** | **34878** | **76.54** | **157.23** | **463.32** | **697.09** |
| **Guarantees** | **1026** | **-** | **-** | **1026** | **5.88** | **-** | **-** | **5.88** |
| Non-sovereign | 77 |  |  | 77 | 4.99 |  |  | 4.99 |
| Sovereign | 949 |  |  | 949 | 0.89 |  |  | 0.89 |
| **Treasury investments** | **8702** | **-** | **-** | **8702** | **0.35** | **-** | **-** | **0.35** |
| **31 December 2024** | **39091** | **4589** | **926** | **44606** | **82.77** | **157.23** | **463.32** | **703.32** |

---

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **ECLs Coverage ratios** | **ECLs Coverage ratios** | **ECLs Coverage ratios** | **ECLs Coverage ratios** |
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| **Loan principal** | **0.36%** | **3.38%** | **57.84%** | **1.97%** |
| Non-sovereign | 2.32% | 7.94% | 69.89% | 9.43% |
| Sovereign | 0.11% | 2.46% | 42.18% | 0.88% |
| **Interest receivables** | **1.02%** | **12.15%** | **46.10%** | **21.48%** |
| Non-sovereign | 6.08% | 23.40% | 91.92% | 29.05% |
| Sovereign | 0.21% | 8.84% | 43.17% | 20.54% |
| **Undisbursed loans** | **0.01%** | **2.92%** | **-** | **0.24%** |
| Non-sovereign | 0.06% |  |  | 0.05% |
| Sovereign | 0.01% | 2.92% |  | 0.26% |
| **Total loans and interest receivables** | **0.26%** | **3.43%** | **50.03%** | **2.00%** |
| **Guarantees** | **0.57%** | **-** | **-** | **0.57%** |
| Non-sovereign | 6.48% |  |  | 6.48% |
| Sovereign | 0.09% |  |  | 0.09% |
| **Treasury investments** | **-** | **-** | **-** | **-** |
| **Total coverage ratio** | **0.21%** | **3.43%** | **50.03%** | **1.58%** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. ECL coverage ratio is ECLs in each stage as a proportion of gross exposure in each stage. It measures
the cover of ECLs by Loans at a reporting period

As at 31 December 2023

*(UA millions)*

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Gross exposure** | **Gross exposure** | **Gross exposure** | **Gross exposure** | **Impairment allowance** | **Impairment allowance** | **Impairment allowance** | **Impairment allowance** |
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| **Loan principal** | **20350** | **1713** | **687** | **22750** | **123.57** | **115.16** | **464.92** | **703.65** |
| Non-sovereign | 1850 | 723 | 483 | 3056 | 38.26 | 41.92 | 378.82 | 459.00 |
| Sovereign | 18500 | 990 | 204 | 19694 | 85.31 | 73.24 | 86.10 | 244.65 |
| **Interest receivables** | **438** | **39** | **409** | **886** | **6.03** | **8.36** | **216.61** | **231.00** |
| Non-sovereign | 45 | 17 | 57 | 119 | 2.66 | 3.08 | 64.64 | 70.39 |
| Sovereign | 393 | 22 | 352 | 767 | 3.37 | 5.27 | 151.97 | 160.61 |
| **Undisbursed loans** | **8536** | **414** | **15** | **8965** | **2.40** | **21.73** | **-** | **24.13** |
| Non-sovereign | 715 |  | 15 | 730 | 0.71 |  |  | 0.70 |
| Sovereign | 7821 | 414 |  | 8235 | 1.69 | 21.73 |  | 23.42 |
| **Total loans and interest receivables** | **29324** | **2166** | **1111** | **32601** | **132.00** | **145.25** | **681.53** | **958.78** |
| **Guarantees** | **694** | **-** | **-** | **694** | **1.93** | **-** | **-** | **1.93** |
| Non-sovereign | 43 |  |  | 43 | 0.50 |  |  | 0.50 |
| Sovereign | 651 |  |  | 651 | 1.43 |  |  | 1.43 |
| **Treasury investments** | **7897** | **-** | **-** | **7897** | **0.30** | **-** | **-** | **0.30** |
| **31 December 2023** | **37915** | **2166** | **1111** | **41192** | **134.23** | **145.25** | **681.53** | **961.01** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **ECLs Coverage ratios** | **ECLs Coverage ratios** | **ECLs Coverage ratios** | **ECLs Coverage ratios** |
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| **Loan principal** | **0.61%** | **6.72%** | **67.69%** | **3.09%** |
| Non-sovereign | 2.07% | 5.80% | 78.46% | 15.02% |
| Sovereign | 0.46% | 7.40% | 42.21% | 1.24% |
| **Interest receivables** | **1.38%** | **21.43%** | **52.89%** | **26.04%** |
| Non-sovereign | 5.92% | 18.15% | 112.69% | 58.75% |
| Sovereign | 0.86% | 23.97% | 43.15% | 20.93% |
| **Undisbursed loans** | **0.03%** | **5.25%** | **-** | **0.27%** |
| Non-sovereign | 0.10% |  |  | 0.10% |
| Sovereign | 0.02% | 5.25% |  | 0.28% |
| **Total loans and interest receivables** | **0.45%** | **6.71%** | **61.34%** | **2.94%** |
| **Guarantees** | **0.28%** | **-** | **-** | **0.28%** |
| Non-sovereign | 1.16% |  |  | 1.16% |
| Sovereign | 0.22% |  |  | 0.22% |
| **Treasury investments** | **-** | **-** | **-** | **-** |
| **Total coverage ratio** | **0.35%** | **6.71%** | **61.34%** | **2.33%** |

---

An analysis of changes in ECLs allowances in relation to the Bank's financial assets carried at amortized cost is provided below.

Analysis of the changes in ECLs allowance account between 31 December 2023 and 31 December 2024 (UA thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Stage 1** | **Stage 2** | **Stage 3** | **Total** |
| Gross carrying amount as at January 2024 | 134232 | 145246 | 681532 | 961010 |
| New assets originated or purchased | 12364 | 13416 | 87 | 25867 |
| Assets derecognized or repaid (excluding write off) | (2098) | (95) |  | (2193) |
| Transfer from Stage 1 to Stage 2 | (30678) | 30678 |  |  |
| Transfer from Stage 2 to Stage 3 |  | (2202) | 2202 |  |
| Transfer from Stage 2 to Stage 1 | 27735 | (27735) |  |  |
| Transfer from Stage 1 to Stage 3 | (17) |  | 17 |  |
| Amount written off |  |  | (252215) | (252215) |
| New and increased provision | (58780) | (2084) | 31711 | (29153) |
| **Gross carrying amount as at 31 December 2024** | **82758** | **157224** | **463334** | **703316** |

---

Liquidity Risk

Liquidity risk is the potential for loss resulting from insufficient liquidity to meet cash flow needs in a timely manner. Liquidity risk arises when there is a maturity mismatch between assets and liabilities. The Bank's principal liquidity risk management objective is to hold sufficient liquid resources to enable it to meet all probable cash flow needs for a rolling 1-year horizon without additional financing from the capital markets for an extended period. In order to minimize this risk, the Bank maintains a Prudential Minimum level of Liquidity (PML) based on the projected net cash requirement for a rolling one-year period. The PML is updated quarterly and computed as the sum of four components: i) 1-year debt service payments, ii) 1-year projected net loan disbursements (loans disbursed less repayments) if greater than zero, iii) loan equivalent value of committed guarantees, and iv) undisbursed equity investments.

To strike a balance between generating adequate investment returns and holding securities that can be easily sold for cash if required, the Bank divides its investment portfolio into tranches with different liquidity objectives and benchmarks. The Bank's core liquidity portfolio (operational portfolio) is invested in highly liquid securities that can be readily liquidated if required to meet the Bank's short-term liquidity needs. Probable redemptions of swaps and borrowings with embedded options are included in the computation of the size of the operational tranche of liquidity. In addition to the core liquidity portfolio, the Bank maintains a second tranche of liquidity (the prudential portfolio) that is also invested in relatively liquid securities to cover its expected medium-term operational cash flow needs. A third tranche of liquidity, which is funded by the Bank's equity resources, is held in a portfolio of fixed income securities intended to collect contractual cash flows with the objective of stabilizing the Bank's net income. In determining its level of liquidity for compliance with the PML, the Bank includes cash, deposits and securities in all the treasury investments, with appropriate haircuts based on asset class and credit rating.

The contractual maturities of financial liabilities and future interest payments at 31 December 2024 and 2023 were as follows.

Contractual Maturities of Financial Liabilities and Future Interest Payments at 31 December 2024 (UA thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Carrying <br> Amount** | **Contractual <br> Cash Flow** | **1 year or <br> less** | **More <br> than 1 <br> year but <br> less than <br> 2 years** | **More <br> than 2 <br> years but <br> less than <br> 3 years** | **More <br> than 3 <br> years but <br> less than <br> 4 years** | **More <br> than 4 <br> years but <br> less than <br> 5 years** | **More <br> than 5 <br> years** |
| **Financial liabilities with derivatives** | | | | | | | | |
| Derivative liabilities | 1228580 | (4393419) | (89894) | (837455) | (461954) | (208069) | (295693) | (2500354) |
| Borrowings at fair value | 26196006 | 31658284 | 3500693 | 7570179 | 7183851 | 4546511 | 4133716 | 4723334 |
|  | 27424586 | 27264865 | 3410799 | 6732724 | 6721897 | 4338442 | 3838023 | 2222980 |
| **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** | **Financial liabilities without derivatives** |
| Accounts payable | 1513361 | 1513361 | 1513361 |  |  |  |  |  |
| Borrowings at |  |  |  |  |  |  |  |  |
| amortized cost | 208024 | 211828 | 60189 | 17876 | 69721 | 8048 | 9122 | 46872 |
|  | 1721385 | 1725189 | 1573550 | 17876 | 69721 | 8048 | 9122 | 46872 |
| **Total financial liabilities** | **29145971** | **28990054** | **4984349** | **6750600** | **6791618** | **4346490** | **3847145** | **2269852** |
| **Represented by:** |  |  |  |  |  |  |  |  |
| Derivative liabilities | 1228580 | (4393419) | (89894) | (837455) | (461954) | (208069) | (295693) | (2500354) |
| Accounts payable | 1513361 | 1513361 | 1513361 |  |  |  |  |  |
| Borrowings | 26404030 | 31870112 | 3560882 | 7588055 | 7253572 | 4554559 | 4142838 | 4770206 |

---

Contractual Maturities of Financial Liabilities and Future Interest Payments at 31 December 2023 (UA thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Carrying <br> Amount** | **Contractual <br> Cash Flow** | **1 year or <br> less** | **More <br> than 1 <br> year but <br> less than <br> 2 years** | **More <br> than 2 <br> years but <br> less than <br> 3 years** | **More <br> than 3 <br> years but <br> less than <br> 4 years** | **More <br> than 4 <br> years but <br> less than <br> 5 years** | **More <br> than 5 <br> years** |
| **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** | **Financial liabilities with derivatives** |
| Derivative liabilities | 1138109 | (3758884) | (150813) | (795504) | (734721) | (465410) | (105650) | (1506786) |
| Borrowings at fair value | 24562870 | 29686112 | 3793584 | 3352680 | 6656597 | 6086045 | 3861541 | 5935665 |
|  | 25700979 | 25927228 | 3642771 | 2557176 | 5921876 | 5620635 | 3755891 | 4428879 |
| **Financial liabilities without derivatives** |  |  |  |  |  |  |  |  |
| Accounts payable | 1604164 | 1604164 | 1604164 |  |  |  |  |  |
| Borrowings at amortized cost | 213538 | 217770 | 106069 | 33871 | 74551 | 250 | 240 | 2789 |
|  | 1817702 | 1821934 | 1710233 | 33871 | 74551 | 250 | 240 | 2789 |
| **Total financial liabilities** | **27518681** | **27749162** | **5353004** | **2591047** | **5996427** | **5620885** | **3756131** | **4431668** |
| **Represented by:** |  |  |  |  |  |  |  |  |
| Derivative liabilities | 1138109 | (3758884) | (150813) | (795504) | (734721) | (465410) | (105650) | (1506786) |
| Accounts payable | 1604164 | 1604164 | 1604164 |  |  |  |  |  |
| Borrowings | 24776408 | 29903882 | 3899653 | 3386551 | 6731148 | 6086295 | 3861781 | 5938454 |

---

Market Risk

Market risk is the risk of loss or adverse financial impact on the Bank's financial instruments due to direct or indirect changes in market prices. The Bank principally faces two forms of market risk: (i) Currency exchange risk (ii) Interest rate risk.

Currency Exchange Risk

Currency risk is the potential loss due to adverse movements in market foreign exchange rates. To promote stable growth in its risk-bearing capacity, the Bank's principal currency risk management objective is to protect its risk capital from translation risk due to fluctuations in foreign currency exchange rates by matching the currency composition of its net assets to the currency composition of the SDR (UA). The agreement establishing the Bank explicitly prohibits it from taking direct currency exchange exposures by requiring li- abilities in any one currency to be matched with assets in the same currency. This is achieved primarily by holding or lending the proceeds of its borrowings (after swap activities) in the same currencies in which they were borrowed (after swap activities). To avoid creating new currency mismatches, the Bank requires its borrowers to service their loans in the currencies disbursed.

Because a large part of the Bank's balance sheet is funded by equity resources, which are reported in UA (equivalent to the SDR), the Bank has a net asset position that is potentially exposed to translation risk when currency exchange rates fluctuate. The Bank's policy is to minimize the potential fluctuation of the value of its net worth measured in UA by matching, to the extent possible, the currency composition of its net assets with the currency basket of the SDR (UA). In keeping with the Bank's currency risk management policy, spot currency transactions are carried out to realign the net assets to the SDR basket each time there is a mis- alignment or when there is a revision to the SDR currency composition.

The Bank also hedges its exposure to adverse movements on currency exchange rates on its administrative expenses. The distribution of the currencies of the Bank's recurring administrative expenditures shows a high concentration of expenses in Euros, US Dollars and CFA Francs.

The net currency position as at 31 December 2024 and 2023 is as follows.

Net Currency Position at 31 December 2024

*(UA thousands)*

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Euro** | **United <br> States <br> Dollar** | **Japanese <br> Yen** | **Pound <br> Sterling** | **Chinese <br> Yuan** | **Other** | **Sub-total** | **Units of <br> Account** | **Total** |
| **Assets** | | | | | | | | | |
| Cash | (113531) | 44820 | 758096 | 4251 |  | 175869 | 869505 | (10199) | 859306 |
| Demand obligations |  |  |  |  |  | 1146 | 1146 |  | 1146 |
| Treasury investments at fair value(a) | 1348989 | 59094 | (877) | 74440 | 346628 | 3109671 | 4937945 |  | 4937945 |
| Treasury investments at amortized cost | 2720924 | 3913518 | 743595 | 816686 | 1001968 | 275261 | 9471952 |  | 9471952 |
| Accounts receivable | 394305 | 1564325 | (655918) | 22541 | 41903 | 148879 | 1516035 | 132226 | 1648261 |
| Loans | 10798002 | 10621561 | 2011 |  |  | 2052085 | 23473659 |  | 23473659 |
| Equity participations | 96235 | 900758 |  |  |  | 28332 | 1025325 | 65306 | 1090631 |
| Other assets |  |  |  |  |  |  |  | 165652 | 165652 |
|  | 15244924 | 17104076 | 846907 | 917918 | 1390499 | 5791243 | 41295567 | 352985 | 41648552 |
| **Liabilities** |  |  |  |  |  |  |  |  |  |
| Accounts payable | (480252) | (567722) | (81643) | (15161) | (41189) | (324842) | (1510809) | (2552) | (1513361) |
| Employee benefits obligations |  |  |  |  |  |  |  | (266195) | (266195) |
| Borrowings | (4919372) | (13434267) | (1077269) | (1587892) | (511008) | (4874222) | (26404030) |  | (26404030) |
| Currency swaps on borrowings and related derivatives(b) | (6218525) | (447333) | 1192960 | 1590631 | 505614 | 2148073 | (1228580) |  | (1228580) |
|  | (11618149) | (14449322) | 34048 | (12422) | (46583) | (3050991) | (29143419) | (268747) | (29412166) |
| **Currency position of equity as at 31 December 2024** | **3626775** | **2654754** | **880955** | **905496** | **1343916** | **2740252** | **12152148** | **84238** | **12236386** |
| **% of sub-total** | **29.84** | **21.98** | **7.25** | **7.45** | **11.06** | **22.42** | **100.00** | **-** | **100.00** |
| **SDR composition as at 31 December 2024** | **29.78** | **44.31** | **6.58** | **7.78** | **11.55** | **-** | **100.00** | **-** | **100.00** |
| (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | 4899390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets |  |  |  |  |  |  |  |  | 42396 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities |  |  |  |  |  |  |  |  | (3841) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | **4937945** |
| (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative asset |  |  |  |  |  |  |  |  | 820923 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liability |  |  |  |  |  |  |  |  | (2049503) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position |  |  |  |  |  |  |  |  | **(1228580)** |

---

Net Currency Position at 31 December 2023

*(UA thousands)*

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Euro** | **United <br> States <br> Dollar** | **Japanese <br> Yen** | **Pound <br> Sterling** | **Chinese <br> Yuan** | **Other** | **Sub-total** | **Units of <br> Account** | **Total** |
| **Assets** | | | | | | | | | |
| Cash | 233406 | 119993 | 813920 | 9552 |  | 209069 | 1385940 | (2791) | 1383149 |
| Demand obligations |  |  |  |  |  | 1146 | 1146 |  | 1146 |
| Treasury investments at fair value(a) | 668677 | 40736 |  | 102048 | 192397 | 3503535 | 4507393 |  | 4507393 |
| Treasury investments at amortized cost | 2391844 | 3145424 | 673187 | 670443 | 939050 | 80913 | 7900861 |  | 7900861 |
| Accounts receivable | 316968 | 1832245 | (645024) | 19512 | 86676 | 137568 | 1747945 | 82432 | 1830377 |
| Loans | 10851051 | 9271836 | 693 |  |  | 1619071 | 21742651 |  | 21742651 |
| Equity participations | 97328 | 923176 |  |  |  | 33275 | 1053779 | 65294 | 1119073 |
| Other assets |  |  |  |  |  |  |  | 115268 | 115268 |
|  | 14559274 | 15333410 | 842776 | 801555 | 1218123 | 5584577 | 38339715 | 260203 | 38599918 |
| **Liabilities** |  |  |  |  |  |  |  |  |  |
| Accounts payable | (450026) | (689922) | (89685) | (17708) | (40480) | (313793) | (1601614) | (2550) | (1604164) |
| Employee benefit obligations |  |  |  |  |  |  |  | (266843) | (266843) |
| Borrowings | (5921523) | (10263334) | (1228638) | (1986517) | (554311) | (4822085) | (24776408) |  | (24776408) |
| Currency swaps on borrowings and related derivatives(b) | (4764260) | (3046443) | 1398319 | 1997069 | 549925 | 2727281 | (1138109) |  | (1138109) |
|  | (11135809) | (13999699) | 79996 | (7156) | (44866) | (2408597) | (27516131) | (269393) | (27785524) |
| **Currency position of equity as at 31 December 2023** | **3423465** | **1333711** | **922772** | **794399** | **1173257** | **3175980** | **10823584** | **(9190)** | **10814394** |
| **% of sub-total** | **31.63** | **12.32** | **8.53** | **7.34** | **10.84** | **29.34** | **100.00** | **-** | **100.00** |
| **SDR composition as at 31 December 2023** | **30.71** | **43.08** | **7.06** | **7.68** | **11.47** | **-** | **100.00** | **-** | **100.00** |
| (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: | (a) Investments measured at fair value comprise: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investments measured at fair value | 4481799 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets |  |  |  |  |  |  |  |  | 30851 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities |  |  |  |  |  |  |  |  | (5257) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of net currency position | **4507393** |
| (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: | (b) Currency swaps on borrowings is made up as follows: |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative asset |  |  |  |  |  |  |  |  | 864500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liability |  |  |  |  |  |  |  |  | (2002609) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net swaps on borrowings per statement of net currency position | **(1138109)** |

---

Currency Risk Sensitivity Analysis

As described in the previous section, the Bank manages its currency risk exposure by matching, to the extent possible, the currency composition of its net assets with the currency basket of the SDR. The SDR is com- posed of a basket of five currencies, namely the US Dollar, Euro, Japanese Yen, Pound Sterling and Chinese Yuan Renminbi. The weight of each currency in the basket is determined and reviewed by the International Monetary Fund (IMF) every five years. The SDR rate represents the sum of specific amounts of the five basket currencies valued in US Dollars, on the basis of the exchange rates quoted at noon each day in the London market.

Currency risks arise with the uncertainty about the potential future movement of the exchange rates be- tween these currencies on the one hand, and between the exchange rates of the SDR currencies and the other non-SDR currencies (mainly African currencies) used by the Bank on the other hand. In this regard, the Bank carries out an annual sensitivity analysis of the translation results of its net assets with regard to the movement of the different exchange rates. The analysis consists of a set of scenarios where the exchange rates between the US Dollar and the other SDR and African currencies are stretched out by large margins (10 percent appreciation/depreciation).

The following tables illustrate the sensitivity of the Bank's net assets to currency fluctuations due to movements in the exchange rate of the currencies in the SDR basket as of 31 December 2024 and 2023, respectively. The sensitivity analysis shown assumes a separate 10 percent appreciation/depreciation for each currency in the basket against the US dollar. Due to a moderate change in the African currency holdings, the table also includes the effect of a 10 percent appreciation/depreciation of each African currency against the SDR. Under the different scenarios, the currency risk management strategy of the Bank shows a minimal change in net assets as a result of currency mismatches.

Sensitivity of the Bank's Net Assets to Currency Fluctuations as at 31 December 2024

*(UA millions)*

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **US <br> Dollar** | **Euro** | **Japanese <br> Yen** | **Pound <br> Sterling** | **Chinese <br> Yuan** | **Other <br> currencies** | **Net <br> assets** | **Change <br> in net <br> assets <br> gain/ <br> (loss)** | **Basis <br> point <br> change of <br> total net assets** |
| Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EUR | 5140.22 | 3816.36 | 781.09 | 896.15 | 1344.47 | 12.65 | 11990.94 | 0.18 | 0bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GBP | 5252.64 | 3545.30 | 798.17 | 1007.32 | 1373.87 | 12.65 | 11989.97 | (0.79) | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;JPY | 5258.89 | 3549.52 | 879.03 | 916.84 | 1375.51 | 12.65 | 11992.44 | 1.68 | 2bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CNY | 5233.07 | 3532.09 | 795.20 | 912.34 | 1505.63 | 12.65 | 11990.97 | 0.22 | 0bps |
| Net assets resulting from a 10% appreciation of each African currency against the SDR | 5293.46 | 3572.85 | 804.38 | 922.87 | 1384.55 | 13.92 | 11992.02 | 1.27 | 1bps |
| Net assets resulting from a 10% depreciation against the USD |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EUR | 5440.92 | 3338.53 | 826.78 | 948.57 | 1423.12 | 12.65 | 11990.58 | (0.18) | 0bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GBP | 5331.12 | 3598.27 | 810.10 | 844.94 | 1394.40 | 12.65 | 11991.48 | 0.73 | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;JPY | 5325.29 | 3594.33 | 735.65 | 928.41 | 1392.87 | 12.65 | 11989.21 | (1.55) | 2bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CNY | 5349.59 | 3610.73 | 812.90 | 932.65 | 1272.03 | 12.65 | 11990.56 | (0.20) | 0bps |
| Net assets resulting from a 10% depreciation of each African currency against the SDR | 5293.46 | 3572.85 | 804.38 | 922.87 | 1384.55 | 11.50 | 11989.61 | (1.15) | 1bps |
| **Assumptions:** |  |  |  |  |  |  |  |  |  |
| Base net assets | 5293.46 | 3572.85 | 804.38 | 922.87 | 1384.55 | 12.65 | 11990.76 |  |  |
| Add: Fair valuation effects on borrowings & derivatives | 414.42 | 212.58 | (128.45) | (8.05) | (7.79) | (237.07) | 245.63 |  |  |
| Base net assets (including fair valuation of borrowings and derivatives) | 5707.88 | 3785.43 | 675.93 | 914.81 | 1376.76 | (224.42) | 12236.39 |  |  |
| Currency weight | 0.5781 | 0.3738 | 13.4520 | 0.0809 | 1.0993 |  |  |  |  |
| Base exchange rate | 1.3050 | 1.2538 | 204.6254 | 1.0407 | 9.5255 |  |  |  |  |

---

*Slight differences may occur due to rounding.*

Sensitivity of the Bank's Net Assets to Currency Fluctuations as at 31 December 2023

*(UA millions)*

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **US <br> Dollar** | **Euro** | **Japanese <br> Yen** | **Pound <br> Sterling** | **Chinese <br> Yuan** | **Other <br> currencies** | **Net <br> assets** | **Change <br> in net <br> assets <br> gain/ <br> (loss)** | **Basis <br> point <br> change of <br> total net <br> assets** |
| Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD | Net assets resulting from a 10% appreciation against the USD |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EUR | 4302.69 | 3523.90 | 730.80 | 771.49 | 1164.60 | 6.49 | 10499.97 | 7.21 | 7bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GBP | 4401.40 | 3277.05 | 747.57 | 868.11 | 1191.31 | 6.49 | 10491.93 | (0.82) | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;JPY | 4404.01 | 3278.99 | 822.82 | 789.65 | 1192.02 | 6.49 | 10493.98 | 1.23 | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CNY | 4384.69 | 3264.60 | 744.73 | 786.19 | 1305.47 | 6.49 | 10492.17 | (0.59) | 1bps |
| Net assets resulting from a 10% appreciation of each African currency against the SDR | 4435.13 | 3302.16 | 753.30 | 795.23 | 1200.44 | 7.14 | 10493.40 | 0.65 | 1bps |
| Net assets resulting from a 10% depreciation against the USD |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;EUR | 4562.81 | 3088.38 | 774.98 | 818.13 | 1235.00 | 6.49 | 10485.79 | (6.95) | 7bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GBP | 4466.24 | 3325.32 | 758.58 | 728.01 | 1208.86 | 6.49 | 10493.50 | 0.76 | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;JPY | 4463.81 | 3323.51 | 689.24 | 800.38 | 1208.20 | 6.49 | 10491.63 | (1.13) | 1bps |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CNY | 4482.01 | 3337.06 | 761.26 | 803.64 | 1102.85 | 6.49 | 10493.31 | 0.54 | 1bps |
| Net assets resulting from a 10% depreciation of each |  |  |  |  |  |  |  |  |  |
| African currency against the SDR | 4435.13 | 3302.16 | 753.30 | 795.23 | 1200.44 | 5.90 | 10492.16 | (0.59) | 1bps |
| **Assumptions:** |  |  |  |  |  |  |  |  |  |
| Base net assets | 4435.13 | 3302.16 | 753.30 | 795.23 | 1200.44 | 6.49 | 10492.75 |  |  |
| Add: Fair valuation effects on borrowings & derivatives | 265.97 | 252.99 | 35.42 | (0.10) | (7.28) | (225.36) | 321.64 |  |  |
| Base net assets (including fair valuation of borrowings and derivatives) | 4701.10 | 3555.15 | 788.72 | 795.13 | 1193.16 | (218.87) | 10814.39 |  |  |
| Currency weight | 0.5781 | 0.3738 | 13.4520 | 0.0809 | 1.0993 |  |  |  |  |
| Base exchange rate | 1.3449 | 1.2143 | 190.3765 | 1.0554 | 9.5555 |  |  |  |  |

---

*Slight differences may occur due to rounding.*

Interest Rate Risk

The Bank's interest rate risk sensitivity is comprised of the following two elements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The sensitivity of the interest margin between the rate the Bank earns on its assets and the cost of the
borrowings funding such assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The sensitivity of the income on assets funded by equity resources to changes in interest rates.

The Bank's principal interest rate risk management objective is to generate a stable overall net interest margin that is not overly sensitive to sharp changes in market interest rates, but yet adequately responsive to general market trends.

The interest rate risk positions as at 31 December 2024 and 2023 were as follows.

Interest Rate Risk Position as at 31 December 2024

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **1 year or <br> less** | **More <br> than 1 <br> year but <br> less than <br> 2 years** | **More <br> than 2 <br> years but <br> less than <br> 3 years** | **More <br> than 3 <br> years but <br> less than <br> 4 years** | **More <br> than 4 <br> years but <br> less than <br> 5 years** | **More <br> than 5 <br> Years** | **Non <br> interest <br> bearing <br> funds** | **Total** |
| **Assets** | | | | | | | | |
| Cash | 859306 |  |  |  |  |  |  | 859306 |
| Demand obligations | 1146 |  |  |  |  |  |  | 1146 |
| Treasury Investments(a) | 5858600 | 725470 | 791270 | 928080 | 1008180 | 5182900 | (84603) | 14409897 |
| Accounts receivable | 1648261 |  |  |  |  |  |  | 1648261 |
| Loans—disbursed and outstanding | 21238849 | 331293 | 277584 | 284562 | 296074 | 1811617 | (48222) | 24191757 |
| Hedged loans—fair value adjustment |  |  |  |  |  |  | (217548) | (217548) |
| Accumulated impairment for loan losses |  |  |  |  |  |  | (500550) | (500550) |
| Equity participations |  |  |  |  |  |  | 1090631 | 1090631 |
| Other assets |  |  |  |  |  |  | 165652 | 165652 |
|  | **29606162** | **1056763** | **1068854** | **1212642** | **1304254** | **6994517** | **405360** | **41648552** |
| **Liabilities** |  |  |  |  |  |  |  |  |
| Accounts payable | (1513361) |  |  |  |  |  |  | (1513361) |
| Employee benefit obligations | (266195) |  |  |  |  |  |  | (266195) |
| Borrowings(b) | (29373220) |  |  |  |  |  | 1740610 | (27632610) |
|  | (31152776) |  |  |  |  |  | 1740610 | (29412166) |
| **Interest rate risk position as at 31 December 2024\*** | **(1546614)** | **1056763** | **1068854** | **1212642** | **1304254** | **6994517** | **2145970** | **12236386** |
| *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* |
| (a) Treasury investments comprise: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury Investments |  |  |  |  |  |  |  | 14371342 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—investments | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—investments |  |  |  |  |  |  | 42396 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—investments | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—investments |  |  |  |  |  |  | (3841) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of interest rate risk |  |  |  |  |  |  | **14409897** |
| (b) Borrowings comprise: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrowings |  |  |  |  |  |  |  | 26404030 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—borrowings | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—borrowings |  |  |  |  |  |  | (820923) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—borrowings | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—borrowings |  |  |  |  |  |  | 2049503 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk |  |  |  |  |  | **27632610** |

---

Interest Rate Risk Position as at 31 December 2023 (UA thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **1 year or <br> less** | **More<br> than 1**<br> **year but<br> less than**<br> **2 years** | **More<br> than 2**<br> **years but<br> less than**<br> **3 years** | **More<br> than 3**<br> **years but<br> less than**<br> **4 years** | **More <br> than 4 <br> years but <br> less than <br> 5 years** | **More <br> than 5 <br> years** | Non <br> interest <br> bearing <br> funds | **Total** |
| **Assets** |  |  |  |  |  |  |  |  |
| Cash | 1383149 |  |  |  |  |  |  | 1383149 |
| Demand obligations | 1146 |  |  |  |  |  |  | 1146 |
| Treasury Investments(a) | 5227441 | 650170 | 678680 | 777660 | 773730 4 | ,368130 | (67557) | 12408254 |
| Accounts receivable | 1830377 |  |  |  |  |  |  | 1830377 |
| Loans—disbursed and outstanding | 19929812 | 316043 | 333728 | 281559 | 279895 | 1655018 | (46871) | 22749184 |
| Hedged loans—fair value adjustment |  |  |  |  |  |  | (278757) | (278757) |
| Accumulated impairment for loan losses |  |  |  |  |  |  | (727776) | (727776) |
| Equity participations |  |  |  |  |  |  | 1119073 | 1119073 |
| Other assets |  |  |  |  |  |  | 115268 | 115268 |
|  | **28371925** | **966213** | **1012408** | **1059219** | **1053625 6** | **,023148** | **113380** | **38599918** |
| **Liabilities** |  |  |  |  |  |  |  |  |
| Accounts payable | (1604164) |  |  |  |  |  |  | (1604164) |
| Employee benefit obligations | (266843) |  |  |  |  |  |  | (266843) |
| Borrowings(b) | (27358776) |  |  |  |  |  | 1444259 | (25914517) |
|  | (29229783) |  |  |  |  |  | 1444259 | (27785524) |
| **Interest rate risk position as at 31 December 2023\*** | **(857858)** | **966213** | **1012408** | **1059219** | **1053625 6** | **,023148** | **1557639** | **10814394** |
| *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* | *\* Interest rate risk position represents equity on the balance sheet.* |
| (a) Treasury investments comprise: | (a) Treasury investments comprise: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Treasury Investments |  |  |  |  |  |  |  | 12382660 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—investments | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—investments |  |  |  |  |  |  | 30851 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—investments | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—investments |  |  |  |  |  |  | (5257) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount per statement of interest rate risk |  |  |  |  |  | **12408254** |
| (b) Borrowings comprise: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Borrowings |  |  |  |  |  |  |  | 24776408 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—borrowings | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative assets—borrowings |  |  |  |  |  |  | (864500) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—borrowings | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Derivative liabilities—borrowings |  |  |  |  |  |  | 2002609 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net borrowings per statement of interest rate risk |  |  |  |  |  | **25914517** |

---

Interest Rate Risk on Assets Funded by Debt

Two-thirds of the Bank's interest-rate-sensitive assets are funded by debt. The Bank seeks to generate a stable net interest margin on assets funded by debt by matching the interest rate characteristics of each class of assets with those of the corresponding liabilities.

In 1990, the Bank began offering variable rate loans. The interest rate on these loans resets semi-annually based on the average cost of a dedicated pool of the Bank's borrowings. The pool is funded with a mix of fixed rate and floating rate borrowings to provide borrowers with broadly stable interest rates that gradually track changes in market interest rates. The cost of funds pass-

through formulation incorporated in the lending rates charged on the Bank's pool-based loans has traditionally helped to minimize the interest rate sensitivity of the net interest margin on this part of its loan portfolio. In view of declining demand for this product in favour of market-based loans, the Bank is carefully managing the gradual winding down of the designated funding pools.

Since 1997, the Bank has offered fixed and floating rate loans whose interest rate is directly linked to market interest rates (market-based loans). For the market-based loan products, the Bank's net interest margin is preserved by using swaps to align the interest rate sensitivity of the loans with that of the Bank's underlying funding reference (six-month floating reference rate). The Bank may also provide borrowers with risk management products such as swaps to modify the currency and interest rate terms of its market-based loan products. Although it retains the credit risks of the borrower, the Bank eliminates the associated market risk on these risk management products by simultaneously laying off market risks with an approved derivative counterparty. As at 31 December 2024, the Bank has transitioned all appropriate LIBOR referenced contracts to their respective Alternative Reference Rates.

For the portfolio of liquid assets funded by borrowings, the Bank protects its net interest margin by man- aging its investments within limits around benchmarks that replicate the interest rate characteristics of the underlying funding for each portfolio tranche. The portfolio of liquid assets funded by borrowings is currently divided into two tranches to reflect the different business purposes and underlying funding. The core part of the investment portfolio is held to comply with the Bank's liquidity policy and uses a six-month floating rate benchmark. The operational liquidity portfolio is managed to meet projected operational cash flow needs and uses a one-month floating rate benchmark.

The Bank diversifies the sources of its funding by issuing debt in a variety of markets and instruments. Unless fixed rate funding is required for one of its pool-based loan products, the Bank protects its net interest margin by simultaneously swapping all new borrowings into floating rate in one of the Bank's active currencies on a standard six-month floating rate reference. Where the Bank issues structured debt, the Bank simultaneously enters into a swap with matching terms to synthetically create the desired six-month floating rate funding. For risk management purposes, callable funding is considered as one alternative to issuing short-term debt such as Euro commercial paper. The Bank manages refinancing risk by: (i) limiting the amount of debt that will mature or is potentially callable within one year to 25 percent of the outstanding debt portfolio, and (ii) trying to match the average maturity of loans priced with a fixed spread with borrowing with similar maturity.

Interest Rate Risk on Assets Funded by Equity

The second principal source of interest rate risk is the interest rate sensitivity of the income earned from funding a significant portion of the Bank's assets with equity resources. These assets are mostly made up of fixed rate loans and investments with an average duration of 5 years. Changes in market interest rates in the currencies of the Bank's equity resources (the SDR) affect the net interest margin earned on assets funded by equity. In general, lower nominal market interest rates result in lower lending and investment rates, which in the long term reduce the nominal earnings on the Bank's equity resources.

The Bank manages the interest rate profile of the assets funded by equity resources with the objective of reducing the sensitivity of the net interest margin to fluctuations in market interest rates. This is achieved by continuously adjusting the repricing profile of the assets funded by the Bank's equity resources (fixed rate loans and investments) to match a repricing profile benchmark. The Bank's repricing profile benchmark is a 10-year ladder whereby a uniform 10 percent of the Bank's assets is funded by equity and repriced in each year. Using this benchmark, the Bank's net interest margin on assets funded by equity tends to track a 10- year moving average of 10-year maturity SDR interest rates.

At the end of December 2024, the Bank's overall repricing profile was closely aligned to the benchmark in almost all annual buckets.

Net Interest Margin Sensitivity

A parallel upward shift in the SDR curve of 100 bps would have generated a maximum gain in income statement of UA 7.48 million and UA 7.29 million as of 31 December 2024 and 2023, respectively.

Fair Value Sensitivity

Movements in interest rates also have an impact on the values of assets and liabilities that are reported in the financial statements at FVTPL. The table below shows the effect of a parallel yield curve movement of +/– 1bp of each of the currencies in the investment portfolio and the borrowings and derivative portfolios as of 31 December 2024. The market experienced relatively high interest rates during the year. As such, the sensitivity analysis for 31 December 2024 was computed on the basis of 1bp, which is the change that was reasonably possible as at the reporting date.

Sensitivity analysis of Treasury Investments, Borrowings and related derivatives (UA thousands)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Upward parallel shift** | **Upward parallel shift** | **Downward parallel shift** | **Downward parallel shift** |
| | **2024 <br> gain/(loss)** | **2023 <br> gain/(loss)** | **2024 <br> gain/(loss)** | **2023 <br> gain/(loss)** |
| Treasury Investments at FVTPL | (509) | 509 | 504 | (509) |
| Borrowings at FVTPL and derivatives | (5024) | (3615) | 5138 | 3959 |

---

Prepayment Risk

In addition to the two principal sources of interest rate risk described above, the Bank is exposed to prepayment risk on loans committed before 1997 on which the Bank is unable to charge a prepayment penalty. In practice the level of prepayments on such loans has generally been within acceptable levels. For all market- based loans issued since 1997, the Bank protects itself from prepayment risk by linking the prepayment penalty to the cost of redeploying the funds at current market rates. Since 2006, total annual prepayments on loans particularly those committed prior to 1997 have been declining over the years. Prepayments in the year ended 31 December 2024 amounted to UA 39.63 million, compared with prepayments of UA 101.98 million realized in 2023, none of which related to loans committed prior to 1997.

Operational Risk

Like all financial institutions, the Bank is exposed to operational risks arising from its systems, processes, people and external events.

Operational risks include the risks of losses resulting from inadequate or failed internal processes, people, and/or systems, and from external events which could have a negative financial or adverse reputational im- pact. Operational risk is present in virtually all the Bank's transactions or activities and includes losses attributable to failures of internal processes in credit and market operations.

The office of the Group Chief Risk Officer has oversight on operational risk activities across the Bank. This includes the implementation of an Integrated Internal Control Framework (IICF), an Internal Control over Financial Reporting (ICFR) based on the COSO Framework and an Operational Risk Management Framework (ORMF). The ICFR serves as a means of regularly evaluating the effectiveness and efficiency of the Bank's internal controls in all significant business processes with financial statement impact. The scope of this evaluation is gradually being expanded to include IT General Controls and IT Application controls with financial statement impact. As part of this process, Management's attestation on the adequacy of internal controls over financial reporting is published in the Bank's Annual Report.

The ORMF which was revised in 2019 ensures a structured and well-coordinated approach to risk identification and assessment, risk mitigation and control as well as risk reporting across the Bank. It also provides the basis for applying an advanced standard in measuring operational risk capital. Currently, the Bank's Capital

Adequacy and Exposure Management Framework provides for an operational risk capital charge of 15 per- cent of the average operating income for the preceding 3 years, in line with Basel II recommendations for operational risk.

It is the primary responsibility of the management of each business unit to implement adequate controls in their respective business processes based on the prevailing institutional standards. Management is required to sign attestation of compliance annually.

Compliance with institutional standards is verified through periodic reviews undertaken by the Office of the Auditor General of the Bank. The results of internal audit reviews are discussed with the Management of the relevant business unit(s), with summaries submitted to Senior Management of the Bank and the Audit and Finance Committee of the Board of Directors.

The Bank also has a contingency and business continuity plan that aims to ensure the continuity of its operations and protect the interests of all the key stakeholders of the Bank Group, namely, the member countries (borrowing and non-borrowing), bondholders and other creditors as well as employees and their families, in the event of any disturbance in its office locations. Three key organs in the Bank ensure the oversight and implementation of the plan: (i) the Executive Crisis Committee, chaired by the President of the Bank, makes the key decisions based on recommendations from the Operations Crisis Committee (OCC); (ii) the OCC, chaired by the Corporate Vice President, closely monitors all developments affecting the Bank and advises on measures necessary to mitigate the relevant risks; and (iii) the Business Continuity Plan Unit follows up on the implementation of decisions made and is also responsible for periodic tests of the overall business continuity preparedness of the Bank and staff.

Other elements of the Bank's operational risk management practices include compliance with the Code of Conduct and Staff Rules, the work of the Integrity and Anti-Corruption Department and the existence of a whistleblower protection policy.

NOTE D—FINANCIAL ASSETS AND FINANCIAL LIABILITIES

he tables below set out the classification of each class of financial assets and financial liabilities, and their respective fair values as at 1 December 2024 and 31 December 2023:

Analysis of Financial Assets and Financial Liabilities by Measurement Basis

31 December 2024

*(UA thousands)*

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Financial assets and<br> liabilities at FVTPL** | **Financial assets and<br> liabilities at FVTPL** | | **Financial <br> assets and <br> liabilities at <br> amortized <br> cost** | | |
| | **Mandatorily at <br> fair value** | **Designated at <br> fair value** | <br>**Fair value <br> through <br> OCI** | **Financial <br> assets and <br> liabilities at <br> amortized <br> cost** | <br>**Total <br> carrying <br> amount** | <br>**Fair value** |
| Cash |  |  |  | 859306 | 859306 | 859306 |
| Demand obligations |  |  |  | 1146 | 1146 | 1146 |
| Treasury investments | 4899390 |  |  | 9471952 | 14371342 | 13148444 |
| Derivative assets | 863319 |  |  |  | 863319 | 863319 |
| Accounts receivable |  |  |  | 1648261 | 1648261 | 1648261 |
| Loans |  |  |  | 23691207 | 23691207 | 23691207 |
| Equity participations |  |  | 1090631 |  | 1090631 | 1090631 |
| **Total financial assets** | **5762709** | **-** | **1090631** | **35671872** | **42525212** | **41302314** |
| Accounts payable |  |  |  | 1513361 | 1513361 | 1513361 |
| Derivative liabilities | 2053344 |  |  |  | 2053344 | 2053344 |
| Borrowings |  | 26196006 |  | 208024 | 26404030 | 25997403 |
| **Total financial liabilities** | **2053344** | **26196006** | **-** | **1721385** | **29970735** | **29564108** |

---

31 December 2023

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Financial assets and<br> liabilities at FVTPL** | **Financial assets and<br> liabilities at FVTPL** | | **Financial <br> assets and <br> liabilities at <br> amortized <br> cost** | | |
| | **Mandatorily at <br> fair value** | **Designated at <br> fair value** | <br>**Fair value <br> through <br> OCI** | **Financial <br> assets and <br> liabilities at <br> amortized <br> cost** | <br>**Total <br> carrying <br> amount** | <br>**Fair value** |
| Cash |  |  |  | 1383149 | 1383149 | 1383149 |
| Demand obligations |  |  |  | 1146 | 1146 | 1146 |
| Treasury investments | 4481799 |  |  | 7900861 | 12382660 | 11901742 |
| Derivative assets | 895351 |  |  |  | 895351 | 895351 |
| Accounts receivable |  |  |  | 1830377 | 1830377 | 1830377 |
| Loans |  |  |  | 22021408 | 22021408 | 22021408 |
| Equity participations |  |  | 1119073 |  | 1119073 | 1119073 |
| **Total financial assets** | **5377150** | **-** | **1119073** | **33136941** | **39633164** | **39152246** |
| Accounts payable |  |  |  | 1604164 | 1604164 | 1604164 |
| Derivative liabilities | 2007866 |  |  |  | 2007866 | 2007866 |
| Borrowings |  | 24562870 |  | 213538 | 24776408 | 24443164 |
| **Total financial liabilities** | **2007866** | **24562870** | **-** | **1817702** | **28388438** | **28055194** |

---

The table below classifies the Bank's financial instruments that were carried at fair value at 31 December 2024 and 31 December 2023 into three levels reflecting the relative reliability of the measurement bases, with level 1 as the most reliable.

Hierarchy of financial instruments at fair value through profit or loss (UA thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Quoted prices in<br> active markets for the<br> same instrument** | **Quoted prices in<br> active markets for the<br> same instrument** | **Valuation techniques<br> for which all<br> significant inputs are<br> based on observable<br> market data** | **Valuation techniques<br> for which all<br> significant inputs are<br> based on observable<br> market data** | **Valuation techniques<br> for which any<br> significant input is not<br> based on observable<br> market data** | **Valuation techniques<br> for which any<br> significant input is not<br> based on observable<br> market data** |  |  |
|  | **(Level 1)** | **(Level 1)** | **(Level 2)** | **(Level 2)** | **(Level 3)** | **(Level 3)** | **Total** | **Total** |
| | **2024** | **2023** | **2024** | **2023** | **2024** | **2023** | **2024** | **2023** |
| Treasury investments | 4297348 | 3755026 | 599695 | 724157 | 2347 | 2616 | 4899390 | 4481799 |
| Derivative assets | 42396 | 30851 | 814422 | 856370 | 6501 | 8130 | 863319 | 895351 |
| Equity participation |  |  |  |  |  |  |  |  |
|  | 9729 | 12338 |  |  | 1080902 | 1106735 | 1090631 | 1119073 |
| **Total financial assets** | **4349473** | **3798215** | **1414117** | **1580527** | **1089750** | **1117481** | **6853340** | **6496223** |
| Derivative liabilities |  |  |  |  |  |  |  |  |
|  |  |  | 1866033 | 1894428 | 187311 | 113438 | 2053344 | 2007866 |
| Borrowings | 17456616 | 15241781 | 7731318 | 8277437 | 1008072 | 1043652 | 26196006 | 24562870 |
| **Total financial liabilities** | **17456616** | **15241781** | **9597351** | **10171865** | **1195383** | **1157090** | **28249350** | **26570736** |

---

The Bank's policy is to recognize transfers out of level 3 as of the date of the event or change in circumstances that caused the transfer. Investments whose values are based on quoted market prices in active markets, and are therefore classified within Level 1, include active listed equities, exchange-traded derivatives, US government treasury bills and certain non-US sovereign obligations. The Bank does not adjust the quoted price for these instruments.

Financial instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, dealer quotations or alternative pricing sources supported by observable inputs are classified within Level 2. These include investment-grade corporate bonds and certain non-US sovereign obligations, listed equities, over-the-counter derivatives and a convertible loan. As Level 2 investments include positions that are not traded in active markets and/or are subject to transfer restrictions, valuations may be adjusted to reflect illiquidity and/or non-transferability, which are generally based on available market information.

Investments classified within Level 3 have significant unobservable inputs, as they trade infrequently or do not trade at all. Instruments in Level 3 include loans to regional member countries, private equity and corporate debt securities including some structured asset and mortgage-backed instruments. As observable prices are not available for these securities, the Bank has used valuation techniques to derive the fair value.

However as noted earlier following the adoption of the expected credit loss model the fair value of loans measured at amortized cost are deemed to approximate their carrying value net of impairment loss while the fair values of some securities are derived merely for disclosure purposes rather than for reporting on the balance sheet.

The primary products classified at Level 3 are as follows.

Debt Securities—Asset and Mortgage-Backed Securities

Due to the lack of liquidity in the market and the prolonged period of time under which many securities have not traded, obtaining external prices is not a strong enough measure to determine whether an asset has an observable price or not. Therefore, once external pricing has been verified, an assessment is made whether each security is traded with significant liquidity based on its credit rating and sector. If a security is of low credit rating and/or is traded in a less liquid sector, it will be classified as Level 3. Where third party pricing is not available, the valuation of the security will be estimated from market standard cash flow models with input parameter assumptions which include prepayment speeds, default rates, discount margins derived from comparable securities with similar vintage, collateral type, and credit ratings. These securities are also classified as Level 3.

Equity Shares—Private Equity

The fair value of investments in unlisted entities is assessed using appropriate methods, for example, dis- counted cash flows or Net Asset Value (NAV). The fair value of the Bank's equity participation is estimated as the Bank's percentage ownership of the net asset value of the investments.

Derivatives

Trading derivatives are classified at Level 3 if there are parameters which are unobservable in the market, such as products where the performance is linked to more than one underlying. Examples are derivative transactions and derivatives attached to local currency transactions. These unobservable correlation parameters could only be implied from the market, through methods such as historical analysis and comparison to historical levels or benchmark data.

Reconciliation of Level 3 Fair Value Balances

Reconciliation of fair value balances measured using valuation techniques with no significant input from observable market data (level 3 hierarchy) between 31 December 2024 and 31 December 2023 is as follows.

Reconciliation of level 3 fair value balances (UA thousands)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Treasury <br> Investment <br> at FVTPL** | **Equity <br> Investments <br> at FVOCI** | **Derivative <br> Assets** | **Derivative <br> Liabilities** | **Borrowings** |
| Balance at 1 January 2023 | 2884 | 1035586 | 374 | (144313) | (928005) |
| Gain/(Losses) recognized in income statement | (232) |  | 2716 | 51802 | (41871) |
| Gains recognized in statement of comprehensive |  |  |  |  |  |
| income |  | 42945 |  |  |  |
| Purchases, issues and settlements (net) | (14) | 48076 | 5087 | 7582 | (86391) |
| Translation effects | (22) | (19872) | (224) | (28332) | 12615 |
| Transfer between assets and liabilities |  |  | 177 | (177) |  |
| **Balance at 31 December 2023** | **2616** | **1106735** | **8130** | **(113438)** | **(1043652)** |
| Balance at 1 January 2024 | 2616 | 1106735 | 8130 | (113438) | (1043652) |
| Gain/(Losses) recognized in income statement | (311) |  | (12667) | (31333) | 34823 |
| Gains recognized in statement of comprehensive |  |  |  |  |  |
| income |  | (66135) |  |  |  |
| Purchases, issues and settlements (net) | (31) | 4141 | 4018 | 1462 | 10787 |
| Reclassification |  |  | 138 | (14413) | (15612) |
| Translation effects | 73 | 36161 | 211 | (22918) | 5582 |
| Transfer between assets and liabilities |  |  | 6671 | (6671) |  |
| **Balance at 31 December 2024** | **2347** | **1080902** | **6501** | **(187311)** | **(1008072)** |

---

Fair Value Hierarchy—Financial Assets and Financial Liabilities at Amortized Cost

The table below classifies the fair value of the Bank's financial instruments that were carried at amortized cost at 31 December 2024 and 31 December 2023 into three levels reflecting the observability of inputs in the fair measurements, with level 1 as observable and level 3 unobservable.

Fair value hierarchy of financial instruments at amortized costs (UA thousands)

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Quoted prices in<br> active markets for the<br> same instrument** | **Quoted prices in<br> active markets for the<br> same instrument** | **Valuation techniques<br> for which all<br> significant inputs are<br> based on observable<br> market data** | **Valuation techniques<br> for which all<br> significant inputs are<br> based on observable<br> market data** | **Valuation techniques<br> for which any<br> significant input is not<br> based on observable<br> market data** | **Valuation techniques<br> for which any<br> significant input is not<br> based on observable<br> market data** |  |  |
|  | **(Level 1)** | **(Level 1)** | **(Level 2)** | **(Level 2)** | **(Level 3)** | **(Level 3)** | **Total** | **Total** |
| | **2024** | **2023** | **2024** | **2023** | **2024** | **2023** | **2024** | **2023** |
| Treasury investments | 8266885 | 7397989 | 552547 | 37708 |  |  | 8819432 | 7435697 |
| Loans |  |  |  |  | 23691207 | 22021408 | 23691207 | 22021408 |
| **Total financial assets** | **8266885** | **7397989** | **552547** | **37708** | **23691207** | **22021408** | **32510639** | **29457105** |
| Borrowings |  |  | 180774 | 206118 | 18334 |  | 199108 | 206118 |
| **Total** | **-** | **-** | **180774** | **206118** | **18334** | **-** | **199108** | **206118** |

---

Quantitative Information about Fair Value Measurements Using Significant Unobservable Inputs (Level 3)

The table below shows the valuation techniques used in the determination of fair values for financial assets within level 3 of the measurement hierarchy as well as the key unobservable inputs used in the valuation models. The Bank has determined that market participants would use the same inputs in pricing the financial instruments. Management considers that changing the unobservable inputs described below to reflect other reasonably possible alternative assumptions would not result in a significant change in the estimated fair value.

---

| | | | |
|:---|:---|:---|:---|
| **Type of financial <br> instrument** | **Valuation approach** | **Key unobservable input** | **Inter-relationship <br> between key <br> unobservable inputs and <br> fair value measurement** |
| **Treasury investments** <br> Time deposits <br> Asset-backed securities Government and agency <br> obligations Corporate bonds <br> Financial institutions Supranational | Discounted cash flow <br> Comparable pricing | Credit spread <br> Conditional prepayment rate <br> Constant default rate <br> Expected payments profile <br> following default <br> Loss-given default yield | Increase in rate reduces <br> fair value |
| **Loans** <br> Fixed rate <br> Floating rate | Discounted cash flow | Average cost of capital <br> Probability of default, loss <br> given default | A high probability of default <br> results in lower fair value |
| **Derivative assets** | Options model | Volatility of credit <br> Counterparty credit risk "Own <br> credit" risk |  |
| **Equity participations** | Net asset value | Percentage of equity <br> holdings and net assets | Increase in net asset <br> increases fair value |
| **Derivative liabilities** | Discounted cash flow | Volatility of credit spreads |  |
| **Borrowings** | Consensus pricing | Offered quotes "Own <br> credit" |  |

---

Significant Unobservable Inputs

Although the Bank believes that its estimates of fair value are appropriate, the use of different methodologies or assumptions could lead to different fair value results.

The valuation techniques applied with significant unobservable inputs are described briefly below.

Comparable pricing

Comparable pricing refers to the method whereby valuation is done by calculating an implied yield from the price of a similar comparable observable instrument. The comparable instrument for a private equity investment is a comparable listed company. The comparable instrument in case of bonds is a similar comparable but observable bond. This may involve adjusting the yield to derive a value for the unobservable instrument.

Yield

Yield is the interest rate that is used to discount the future cash-flows in a discounted cash-flow model.

Correlation

Correlation is the measure of how movement in one variable influences movement in another variable. Credit correlation generally refers to the factor that describes the relationship between the probability of individual entities defaulting on obligations and the joint probability of multiple entities defaulting on obligations. Similarly, equity correlation is the correlation between two equity instruments. An interest rate correlation refers to the correlation between two swap rates. Foreign exchange (FX) correlation represents the correlation between two different exchange rates.

Liquidity Discount

A liquidity discount is applied primarily to unlisted firms to reflect the fact that these stocks are not actively traded. An increase in liquidity discount in isolation will result in unfavourable movement in the fair value of the unlisted firm.

Volatility

Volatility represents an estimate of how much a particular instrument, parameter or index will change in value over time. Volatilities are generally implied from the observed option prices. For certain instruments, volatility may change with the strike and maturity profile of the option.

Credit Spreads

Credit spreads represent the additional yield that a market participant would demand for accepting an expo- sure to the credit risk of an instrument. A change in the assumptions could lead to different fair value results.

Sensitivity Analysis of Valuations of Level 3 Assets and Liabilities Using Unobservable Inputs

For fair value measurements in level 3, changing one or more of the assumptions used would have the following effects.

Investments

The fair value of level 3 investments is sensitive to sources of pricing used. The fair value variance arising from using other sources of prices amounted to nil. (2023: nil).

Borrowing at FVTPL and Derivatives

The table below shows the effect of a parallel yield curve movement of +/– 1 bps of each of the currencies in the level 3 borrowings and derivative portfolios as of 31 December 2024 and December 2023. The market experienced relatively high interest rates during the year. As such, the sensitivity analysis for 31 December 2024 was computed on the basis of 1bp, which is the change that was reasonably possible as at the reporting date.

Sensitivity analysis for level 3 Borrowings at FVTPL and related derivatives

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Upward Parallel Shift <br> Gain/(Loss)** | **Upward Parallel Shift <br> Gain/(Loss)** | **Downward Parallel Shift Gain/(Loss)** | **Downward Parallel Shift Gain/(Loss)** |
| | **2024** | **2023** | **2024** | **2023** |
| Level 3 Borrowings at FVTPL and derivative portfolios | 164 | 1457 | (21) | (119) |

---

Day One Gain or Loss—Unrecognized Gains/Losses on the Use of Valuation Models Using Unobservable Inputs

The unamortized balances of day one profit and loss at 31 December 2024 and 31 December 2023 were made up as follows.

Movement in day one gain

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Balance at 1 January | 182318 | 191430 |
| New transactions | (30939) | 17692 |
| Amounts recognized in income statement during the year | (29100) | (20041) |
| Translation effects | (2298) | (6763) |
| **Balance** | **119981** | **182318** |

---

**NOTE E—CASH AND BANK BALANCES**

The Bank's cash and bank details are as follows.

Summary of cash and bank balances

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Balances with central banks | 802171 | 1033188 |
| Balances with commercial banks | 52512 | 347427 |
| Other cash balances | 4623 | 2534 |
| **Total** | **859306** | **1383149** |

---

**NOTE F—TREASURY INVESTMENTS**

As part of its overall portfolio management strategy, the Bank invests in government, agency, supranational, bank and corporate obligations, time deposits, mortgage and asset-backed securities, funded risk participation program, secured lending transactions, resale agreements and related derivative instruments including futures, forward contracts, cross-currency swaps, interest rate swaps, options and short sales.

For government, agency and supranational obligations with final maturity longer than 1 year and less than 15 years, the Bank may only invest in obligations with counterparties having a minimum credit rating of AA- or unconditionally guaranteed by governments of member countries or other official entities with the same rating criteria.

For maturities beyond 15 years and up to 30 years, a AAA rating is required. For mortgage and asset-backed securities, the Bank may only invest in securities with a AAA credit rating. For bank and corporate obligations

with final maturity longer than 6 months and less than 5 years, the Bank may only invest with counterparties having a minimum credit rating of AA-. AAA rating is required for debt obligations beyond 5 years and up to 10 years. The purchases of currency or interest rate options are permitted only if the life of the option contract does not exceed 1 year. Such transactions are only executed with counterparties with credit ratings of AA- or above. All derivative transactions, including options, cross-currency and interest rate swaps including asset swap transactions, are only permitted with approved counterparties or guaranteed by entities with which the Bank has entered into Master Derivative Agreements and a Collateral Support Agreement with minimum credit ratings of A-/A3 at the time of the transaction.

As at 31 December 2024, the Bank had received collateral with fair value of UA 89 million (December 2023: UA 178 million) in connection with swap agreements. This amount was in the form of cash and has been recorded on the balance sheet with a corresponding liability included in "Other accounts payable".

The composition of treasury investments as at 31 December 2024 and 31 December 2023 was as follows.

Net treasury investment portfolio (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Treasury investments at amortized cost | 9472299 | 7901163 |
| Provision for impairment | (347) | (302) |
|  | 9471952 | 7900861 |
| Treasury investments mandatorily measured at FVTPL | 4899390 | 4481799 |
| **Total treasury investments** | **14371342** | **12382660** |

---

Treasury Investment as at 31 December 2024 included the amount UA 589.67 million investment funded by the proceeds of the hybrid capital.

Treasury Investments at Amortized Cost

A summary of the Bank's treasury investments at amortized cost at 31 December 2024 and 31 December 2023 was as follows.

Summary of treasury investments at amortized costs

*(UA millions)*

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;US Dollar | &nbsp;&nbsp;US Dollar | &nbsp;&nbsp;Euro | &nbsp;&nbsp;Euro | &nbsp;&nbsp;CNY | &nbsp;&nbsp;CNY | &nbsp;&nbsp;Other currencies | &nbsp;&nbsp;Other currencies | &nbsp;&nbsp;All currencies | &nbsp;&nbsp;All currencies |
|  | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 |
| Government and agency obligations | 1549.44 | 1200.37 | 1555.97 | 1407.42 | 919.96 | 846.77 | 1134.96 | 1017.11 | 5160.33 | 4471.67 |
| Corporate bonds | 287.25 |  |  |  |  |  |  |  | 287.25 |  |
| Financial institutions | 241.22 | 10.76 | 26.54 | 26.93 |  |  | 275.26 | 80.91 | 543.02 | 118.60 |
| Supranational | 1835.61 | 1934.29 | 1138.46 | 957.53 | 82.16 | 92.42 | 425.47 | 326.65 | 3481.70 | 3310.89 |
| **Total** | **3913.52** | **3145.42** | **2720.97** | **2391.88** | **1002.12** | **939.19** | **1835.69** | **1424.67** | **9472.30** | **7901.16** |

---

The nominal value of treasury investments at amortized cost as of 31 December 2024 is UA 8,707.75 million (31 December 2023: UA 7,887.81 million). The average yield of treasury investments at amortized cost for the year ended 31 December 2024 was 2.09 percent (31 December 2023: 1.78 percent).

The contractual maturity structure of treasury investments at amortized cost as at 31 December 2024 and 31 December 2023 was as follows.

Maturity structure of Treasury investments at amortized costs

*(UA millions)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| One year or less | 651.99 | 642.76 |
| More than one year but less than two years | 723.23 | 656.41 |
| More than two years but less than three years | 790.88 | 675.71 |
| More than three years but less than four years | 933.44 | 778.14 |
| More than four years but less than five years | 1007.02 | 781.47 |
| More than five years | 5365.74 | 4366.67 |
| **Total** | **9472.30** | **7901.16** |

---

The fair value of treasury investments at amortized cost as of 31 December 2024 was UA 8,819.90 million (31 December 2023: UA 7,437.79 million). Treasury investments at amortized costs includes UA 573.89 million (2023: nil) funded with the proceeds of the hybrid capital.

Treasury Investments mandatorily measured at FVTPL

A summary of the Bank's treasury investments at FVTPL at 31 December 2024 and 31 December 2023 were as follows.

Summary of treasury investments at FVTPL

*(UA millions)*

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | &nbsp;&nbsp;US Dollar | &nbsp;&nbsp;US Dollar | &nbsp;&nbsp;Euro | &nbsp;&nbsp;Euro | &nbsp;&nbsp;CNY | &nbsp;&nbsp;CNY | &nbsp;&nbsp;Other currencies | &nbsp;&nbsp;Other currencies | &nbsp;&nbsp;All currencies | &nbsp;&nbsp;All currencies |
|  | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 | &nbsp;&nbsp;2024 | &nbsp;&nbsp;2023 |
| Time deposits | 462.61 | 50.96 | 255.82 | 115.25 | 346.63 | 192.40 | 96.25 | 217.34 | 1161.31 | 575.95 |
| Asset-backed securities | 2.42 | 2.61 |  |  |  |  |  |  | 2.42 | 2.61 |
| Government and agency obligations | 1587.97 | 1836.13 | 585.84 | 365.31 |  |  | 28.76 |  | 2202.57 | 2201.44 |
| Financial institutions | 393.25 | 953.02 | 183.18 | 177.89 |  |  |  |  | 576.43 | 1130.91 |
| Supranational | 611.31 | 545.20 | 345.35 | 25.69 |  |  |  |  | 956.66 | 570.89 |
| **Total** | **3057.56** | **3387.92** | **1370.19** | **684.14** | **346.63** | **192.40** | **125.01** | **217.34** | **4899.39** | **4481.80** |

---

The nominal value of treasury investments mandatorily measured at FVTPL as of 31 December 2024 was UA 4,912.85 million (31 December 2023: UA 4,515.59 million). The average yield of treasury investments mandatorily measured at FVTPL for the period 31 December 2024 was 4.21 percent (31 December 2023: 6.11 percent). The contractual maturity structure of treasury investments mandatorily measured at FVTPL as of 31 December 2024 and 31 December 2023 were as follows.

Maturity structure of treasury investments at FVTPL

*(UA millions)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| One year or less | 1966.25 | 2432.22 |
| More than one year but less than two years | 548.15 | 726.50 |
| More than two years but less than three years | 1355.22 | 526.59 |
| More than three years but less than four years | 872.06 | 560.76 |
| More than four years but less than five years | 155.30 | 233.11 |
| More than five years | 2.41 | 2.62 |
| **Total** | **4899.39** | **4481.80** |

---

Treasury investments at FVTPL includes UA 15.78 million investments (2023: nil) funded with the proceeds of the hybrid capital.

**NOTE G—DERIVATIVE ASSETS AND LIABILITIES**

The fair value of derivative financial assets and financial liabilities as at 31 December 2024 and 31 December 2023 were as follows.

Fair value of derivative financial assets and financial liabilities

*(UA thousands)*

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
| | **Assets** | **Liabilities** | **Assets** | **Liabilities** |
| **Borrowings-related:** |  |  |  |  |
| Cross-currency swaps | 572352 | 1491344 | 515173 | 1285562 |
| Interest rate swaps | 27139 | 550924 | 64420 | 707527 |
| Loan swaps | 221432 | 7235 | 284907 | 9520 |
|  | **820923** | **2049503** | **864500** | **2002609** |
| **Investments-related:** |  |  |  |  |
| Asset swaps |  | 3841 |  | 5257 |
| Futures and others | 42396 |  | 30851 |  |
|  | 42396 | 3841 | 30851 | 5257 |
| **Total** | **863319** | **2053344** | **895351** | **2007866** |

---

The notional amounts of derivative financial assets and liabilities as at 31 December 2024 and 31 December 2023 were follows.

Notional amounts for derivative instruments (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| **Borrowings-related:** |  |  |
| Cross-currency swaps | 14437641 | 13165400 |
| Interest rate swaps | 17122890 | 17679636 |
| Loan swaps | 2879474 | 2765517 |
|  | **34440005** | **33610553** |
| **Investments-related:** |  |  |
| Asset swaps | (84987) | (82609) |
|  | (84987) | (82609) |
| **Total** | **34355018** | **33527944** |

---

Loan Swaps

The Bank has entered into interest rate swaps to effectively convert fixed rate income on loans in certain currencies into variable rate income.

Futures Contracts

The Bank has entered into futures contracts to hedge fixed interest rate bonds against interest rate variations. As at 31 December 2024, the Bank had futures with a notional value of EUR 1,408 million (UA 1,122 million) (2023: EUR 6,939 million, UA 5,699 million) and USD 12,885 million (UA 9,880 million) (2023: USD 16,655 mil-lion, UA 12,414 million) and GBP 303 million (UA 292 million) (2023: Nil).

The carrying values of the Euro, US dollars and GBP futures was a market value of EUR 15.58 million (UA 12.41 million) (2023: EUR 3.66 million, UA 3.00 million) a negative market value of USD 7.08 million (UA 5.43 million) (2023: positive value of USD 16.63 million, UA 12.40 million) and a negative market value of GBP 0.35 million (UA 0.33 million) (2023: Nil) respectively.

Forward Exchange Transactions to Hedge

To insulate the Bank from possible significant increases in administrative expenses that could arise from an appreciation of the principal currencies of administrative expenditure (i.e., EUR, GBP, CFA Franc and USD vis-à-vis the UA), the Bank executed forward exchange transactions to economically hedge its administrative expenses. As at 31 December 2024 there were no open positions with respect to forward exchange transactions.

Hedge Accounting

Fair value hedge

The Bank applies fair value hedge accounting to interest rate swaps contracted to hedge its interest rate risk exposure associated to fixed rate loans. Changes in the fair value of the derivative hedging instruments are recognized in income statement. The hedged item is adjusted to reflect changes in its fair value in respect of the risk being hedged with the gain or loss attributable to the hedged risk being recognized in profit or loss.

The fair value of the loan swaps designated and effective as hedging instruments as at 31 December 2024 was an asset of UA 206.95 million (December 2023: UA 272.74 million). The fair value loss on these loan swaps for the year ended 31 December 2024 was UA 60.07 million (December 2023: loss of UA 111.70 million). The fair

value gain on the hedged loans attributable to the hedged risk was UA 59.26 million (December 2023: gain of UA 114.00 million). Therefore, the hedge effectiveness recognized in the income statement was a loss of UA 0.81 million (December 2023: gain of UA 2.30 million).

Hedge accounting treatment for swaps at the designation date requires the amortization of the difference between the net carrying amount of loans and their fair value from inception. For the year ended December 2024, the amortization of fair value adjustment on the hedged risk amounted to a gain of UA 1.73 million (December 2023: gain of UA 1.87 million).

Cash flow hedge

The Bank issued hybrid capital instruments in 2024 and invested the proceeds in certain type of bonds over an interim of period of time. The transaction was a forecast purchase of bonds (using derivatives) with interest rate risk exposure between when the hybrid capital (is issued and) proceeds are received, and when bonds are purchased over an interim forecast or future period (of up to 3 months) to construct a dedicated bond portfolio.

To mitigate interest rate and income statement volatility during the interim period, the Bank applied cash flow hedge accounting using bonds futures. The table below shows the movement and closing balance on the cash flow hedge reserve and amounts transferred to income statement as reclassification adjustments.

Movement in cash flow hedge reserve

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Fair value losses from hedging instrument | 11568 |  |
| Reclassification to income statement | (863) |  |
| **Net fair value losses in cash flow hedge reserve** | **10705** | **—** |

---

**NOTE H—LOANS AND GUARANTEES**

Loans

The Bank's loan portfolio comprises loans granted to or guaranteed by borrowing member countries as well as certain other non-sovereign-guaranteed loans. Amounts disbursed on loans are repayable in the currency or currencies disbursed by the Bank or in other freely convertible currency or currencies approved by the Bank. The amount repayable in each of these currencies shall be equal to the amount disbursed in the original currency. Loans are granted for a maximum period of twenty years, including a grace period, which is typically the period of project implementation. Loans are for the purpose of financing development projects and programs and are not intended for sale. Furthermore, management does not believe there is a comparable secondary market for the type of loans made by the Bank.

The types of loans currently held by the Bank and the terms applicable are described below.

**Loan Portfolio:** The Bank's loan portfolio is currently made up of three primary types of loans based on the financial terms: fixed rate, floating rate and variable rate loans. Fixed rate and variable rate loans have both multicurrency and single currency terms, that is, they are offered in multi-currencies or in a single currency. While floating rate loans only bear single currency terms.

**Other Loans:** The Bank also offers parallel co-financing and A/B loan syndications. Through syndications the Bank is able to mobilize co-financing by transferring some or all of the risks associated with its loans and guarantees to other financing partners. Thus, syndications decrease and diversify the risk profile of the Bank's financing portfolio. Syndications may be on a funded or unfunded basis and may be arranged on an individual, portfolio, or any other basis consistent with industry practices.

The Bank also offers its RMC local currency loans if the Bank is able to fund efficiently in the local currency market. The local currency loans are offered under the fixed spread loan pricing framework with a "cost- pass-through" principle to ensure that the overall cost of funds is compensated.

At 31 December 2024 and 31 December 2023, outstanding loans were as follows.

Summary of outstanding loan balance (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Outstanding balance of loans—gross | 24191757 | 22749184 |
| Provision for impairment | (500550) | (727776) |
| **Total outstanding loans** | **23691207** | **22021408** |

---

Classification of Loans

At 31 December 2024 and 31 December 2023, the carrying values of net outstanding loans were as follows.

Classification of loans by type

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| **Loans at amortized cost** |  |  |
| Fixed rate loans | 3349440 | 3225176 |
| Floating rate loans | 20695230 | 19381037 |
| Variable rate loans | 147087 | 142971 |
| **Gross loans** | **24191757** | **22749184** |
| Provision for impairment | (500550) | (727776) |
| **Total outstanding loans** | **23691207** | **22021408** |

---

The Bank is exposed to a loan that is measured at FVTPL due to the existence of a conversion option in the loan that could potentially change the future cash flows to no longer represent solely payments of principal and interest as required by IFRS 9. Accordingly, the fair value of this loan, and similar loans, is determined using the expected cash flows model with inputs including interest rates and the borrower's credit spread estimated based on the Bank's internal rating methodology for non-sovereign loans. During the period, the fair value of the loan was determined as zero due to changes in the key valuation inputs. Subsequent changes in the key valuation inputs would lead to impairment gains that would be recognized in the income statement when it happens.

Maturity and Currency Composition of Outstanding Loans

The contractual maturity structure of total outstanding loans (on gross basis) as at 31 December 2024 and 31 December 2023 was as follows.

Maturity structure of loan portfolio

*(UA millions)*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | | **2024** | **2024** | **2023** | **2023** |
| <br>**Periods** | <br>**Fixed rate** | **Floating <br> rate** | **Variable <br> rate** | **Total** | **Total** |
| One year or less | 396.53 | 1640.21 | 147.09 | 2183.83 | 2055.82 |
| More than one year but less than two years | 283.08 | 1645.31 |  | 1928.39 | 1887.45 |
| More than two years but less than three years | 277.58 | 1728.33 |  | 2005.91 | 1940.26 |
| More than three years but less than four years | 284.56 | 1745.49 |  | 2030.05 | 1882.90 |
| More than four years but less than five years | 296.07 | 1629.93 |  | 1926.00 | 1888.08 |
| More than five years | 1811.61 | 12305.96 |  | 14117.57 | 13094.67 |
| **Gross outstanding loans** | **3349.44** | **20695.23** | **147.09** | **24191.76** | **22749.18** |

---

Borrowers may repay loans before their contractual maturity, subject to the terms specified in the loan agreements. The currency composition and types of outstanding loans (on gross basis) as at 31 December 2024 and 31 December 2023 were as follows.

Currency composition by loan type (UA millions)

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  | **2024** | **2024** | **2023** | **2023** |
| | | | **Amount** | **%** | **Amount** | **%** |
| **Fixed rate:** | Multi- <br> currency | Euro |  |  |  |  |
|  |  | Japanese Yen |  |  |  |  |
|  |  | Pound Sterling |  |  |  |  |
|  |  | Swiss Franc |  |  |  |  |
|  |  | US Dollar | 62.82 |  | 61.06 |  |
|  |  |  | 62.82 | 0.26 | 61.06 | 0.27 |
|  | Single <br> currency | Euro | 958.08 |  | 1074.64 |  |
|  |  | Japanese Yen |  |  |  |  |
|  |  | South African Rand | 375.36 |  | 0.59 |  |
|  |  | US Dollar | 377.20 |  | 394.34 |  |
|  |  | Others |  |  |  |  |
|  |  |  | 1710.64 | 7.07 | 1469.57 | 6.46 |
|  | Structured <br> products | Euro | 1367.11 |  | 1491.93 |  |
|  |  | US Dollar |  |  |  |  |
|  |  | South African Rand | 208.87 |  | 202.61 |  |
|  |  |  | 1575.98 | 6.51 | 1694.54 | 7.45 |
| **Floating rate:** | Single <br> currency | Euro | 2573.88 |  | 2949.47 |  |
|  |  | Pound Sterling |  |  |  |  |
|  |  | Japanese Yen |  |  |  |  |
|  |  | South African Rand | 843.80 |  | 832.02 |  |
|  |  | US Dollar | 4943.18 |  | 5264.23 |  |
|  |  | Others |  |  |  |  |
|  |  |  | 8360.86 | 34.56 | 9045.72 | 39.76 |
|  | Structured <br> product | Euro | 6352.49 |  | 5865.26 |  |
|  |  | Japanese Yen | 2.01 |  | 0.70 |  |
|  |  | US Dollar | 5300.46 |  | 3852.64 |  |
|  |  | South African Rand | 679.41 |  | 616.72 |  |
|  |  |  | 12334.37 | 50.99 | 10335.32 | 45.43 |
| **Variable rate:** | Multi- <br> currency | US Dollar | 147.09 |  | 142.97 |  |
|  |  |  | 147.09 | 0.61 | 142.97 | 0.63 |
| **Gross outstanding loans** | **Gross outstanding loans** |  | **24191.76** | **100.00** | **22749.18** | **100.00** |

---

The weighted average yield on outstanding loans (on gross basis) for the year ended 31 December 2024 was 6.08 percent (31 December 2023: 5.34 percent).

A comparative summary of the currency composition of outstanding loans at 31 December 2024 and 31 December 2023 were as follows.

Currency composition of loan portfolio (UA millions)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **2024** | **2024** | **2023** | **2023** |
| | **Amount** | **%** | **Amount** | **%** |
| Euro | 11251.56 | 46.51 | 11381.31 | 50.03 |
| Japanese Yen | 2.01 | 0.01 | 0.70 |  |
| South African Rand | 2107.44 | 8.71 | 1651.95 | 7.26 |
| US Dollar | 10830.75 | 44.77 | 9715.23 | 42.71 |
| **Gross outstanding loans** | **24191.76** | **100.00** | **22749.18** | **100.00** |

---

Reconciliation of ECLs on Loan Principal and Undisbursed loans

The movements in the accumulated provision for impairment on outstanding loan principal for the year ended 31 December 2024 and 31 December 2023 were as follows.

Summary of ECL on loans (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Balance as at 1 January | 727776 | 732263 |
| (Writeback)/Provision on impairment on loan principal and undisbursed loans for the year (net) | (13642) | 5785 |
| Loans written off | (213584) | (10272) |
| **Net balance** | **500550** | **727776** |

---

Accumulated provisions for impairment on outstanding loan principal included the provisions relating to public and private sector loans. During the year ended 31 December 2024, impairment writebacks on private sector loans amounted to UA 167.64 million (2023: provision of UA 6.49 million) while impairment write- backs for sovereign loans amounted to UA 59.05 million (2023: 3.67 million). The accumulated provisions on private sector loans at 31 December 2024 amounted to UA 291.36 million (2023: UA 459.00 million) while accumulated provisions on public sector loans amounted to UA 185.60 million (2023: UA 244.65 million)

ECLs on Stage 3 Loan Principal

At 31 December 2024, outstanding loans with an aggregate principal balance of UA 482.68 million (31 December 2023: UA 686.85 million), of which UA 241.47 million (31 December 2023: UA 246.46 million) was overdue and credit impaired.

The gross amounts of loans that were impaired and their cumulative impairment at 31 December 2024 and 31 December 2023 were as follows.

Summary of ECL on impaired loans (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Outstanding balance on impaired loans | 482681 | 686848 |
| Provision for impairment (Stage 3 only) | (279386) | (464923) |
| **Net balance on impaired loans** | **203295** | **221925** |

---

Accounts Receivable

Accrued Income and Charges Receivable on Loans including Other Accounts Receivable

The accrued income and charges receivable on loans as at 31 December 2024 and 31 December 2023 were as follows.

Summary of accounts receivable (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Accrued income and charges receivable on loans | 952194 | 872739 |
| Provision for impairment | (196540) | (231000) |
| **Total** | **755654** | **641739** |
| Other accounts receivable: |  |  |
| Accrued and other similar receivables | 723342 | 1076986 |
| Staff receivables | 76960 | 60902 |
| Other receivables | 87730 | 46278 |
| Prepayment | 4575 | 4472 |
| **Sub-total** | **892607** | **1188638** |
| **Total Accounts Receivable** | **1648261** | **1830377** |

---

Reconciliation of ECLs on Charges Receivable

The movements in the accumulated provision for impairment on loan interest and charges receivable for the year ended 31 December 2024 and 31 December 2023 were as follows.

Summary of ECL on charges receivable (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Balance at 1 January | 231000 | 221419 |
| Provisions on impairment on loan charges for the year (net) | 4170 | 12502 |
| Loans written off | (38630) | (2921) |
| **Net balance** | **196540** | **231000** |

---

Accumulated provisions for impairment on loan interest and charges receivable included the provisions relating to public and private sector loans. During the year ended 31 December 2024, an impairment writeback was made on interest and charges receivable on private sector loans in the amount of UA 41.05 million (31 December 2023: writeback of UA 8.08 million), while interest and charges receivable on public sector loans increased by UA 6.58 million (2023: UA 24.24 million). The accumulated provision on interest and charges receivable on private sector loans at 31 December 2024 amounted to UA 29.34 million (31 December 2023: UA 70.38 million).

ECLs on Stage 3 Charges Receivable

At 31 December 2024, outstanding charge receivable has an aggregate balance of UA 399.23 million (31 December 2023: UA 409.57 million).

The gross amounts of charge receivable that were impaired and their cumulative impairment at 31 December 2024 and 31 December 2023 were as follows.

Summary of ECL on impaired charges receivable (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Outstanding balance on impaired receivable | 399228 | 409566 |
| Net provision for impairment on loan principal for the year | (183948) | (216609) |
| **Net balance on stage 3 charges receivable** | **215280** | **192957** |

---

Guarantees

The Bank may enter into special irrevocable commitments to pay amounts to borrowers or other parties for goods and services to be financed under loan agreements. At 31 December 2024, outstanding irrevocable reimbursement guarantees issued by the Bank to commercial banks on undisbursed loans amounted to UA 53.41 million (31 December 2023: UA 9.98 million).

Also, the Bank provides repayment guarantees to entities within its regional member countries for development loans granted to such entities by third parties. Guarantees represent potential risk to the Bank if the payments guaranteed for an entity are not made. Repayment guarantees provided by the Bank outstanding at 31 December 2024 amounted to UA 1,026.30 million (31 December 2023: UA 693.83 million), of which UA 59.50 million (31 December 2023: UA 20.57 million) is related to trade finance as at 31 December 2024.

The accumulated ECLs calculated on the guarantees issued by the Bank as at 31 December 2024 was UA 5.88 million (31 December 2023: UA 1.93 million).

Other than the guarantees above issued to other entities, the Bank in 2015 entered into guarantee contracts referred to as EEAs, covering certain of its loans whereby it gives as well as receives compensation in case there is a default in any of the specified loans.

In addition to EEAs, since 2018, the Bank has entered into Balance Sheet Optimization (BSO) transactions which are expected to release risk capital and create additional lending headroom. These transactions involve credit insurance, credit enhancement and synthetic securitization. Like the EEAs, these transactions are accounted for as financial guarantees. The details of BSO initiatives are provided in Note C.

The Bank has purchased credit enhancement facilities from the PSF for some of its non-sovereign loans. As at 31 December 2024, the maximum coverage amounts of non-sovereign loans by PSF amounted to UA 549.26 million (31 December 2023: UA 513.47 million).

The total cost of BSO coverage for the year ended 31 December 2024 was UA 13.84 million (31 December 2023: UA 15.61 million).

**NOTE I—EQUITY PARTICIPATIONS**

Investment in ADF

The African Development Fund (ADF or the Fund) was established in 1972 as an international institution to assist the Bank in contributing to the economic and social development of African countries, to promote co- operation and increase international trade particularly among the African countries, and to provide financing on highly concessional terms for such purposes. The Fund's original subscriptions were provided by the Bank and the original State Participants to the ADF Agreement, and State Participants acceding to the Agreement since the original signing date. Thereafter, further subscriptions were received from participants in the form of Special General Increases and General Replenishments.

The ADF has a 14-member Board of Directors, made up of 7 members selected by the African Development Bank and 7 members selected by State Participants. The Fund's Board of Directors reports to the Board of Governors made up of representatives of the State Participants and the African Development Bank. The Pres- ident of the Bank is the ex-officio President of the Fund.

To carry out its functions, the Fund utilizes the offices, staff, organization, services and facilities of the Bank, for which it pays a share of the administrative expenses. The share of administrative expenses paid by the Fund to the Bank is calculated annually on the basis of a cost-sharing formula, approved by the Board of Directors, which is driven primarily by staff time spent on individual entity's work program deliverables. Based on the cost-sharing formula, the share of administrative expenses incurred by ADF for the year end 31 December 2024 amounted to UA 256.15 million (31 December 2023: UA 172.33 million), representing 51.28 per- cent (December 2023: 51.48 percent) of the shareable administrative expenses incurred by the Bank. The accounts of the ADF are kept separate and distinct from those of the Bank.

Although the AfDB by agreement exercises 50 percent of the voting powers in the ADF, the Agreement establishing the ADF also provides that in the event of termination of the ADF's operations, the assets of the Fund shall be distributed pro-rata to its participants in proportion to the amounts paid-in by them on account of their subscriptions, after settlement of any outstanding claims against the participants. At 31 December 2024, the Bank's pro-rata or economic share in ADF was 0.31 percent (31 December 2023: 0.32 percent).

Notwithstanding the exercise of 50 percent voting power in the Fund by the Bank, the conditions for control under IFRS 10 Consolidated Financial Statements are not met since the Bank does not have absolute voting interest to control ADF, rights to variable returns from its relationship with ADF and its economic interest in the Fund is less than 1 percent. Consequently, the Fund was not consolidated in the Bank's Financial Statements.

As a result of the implementation in 2006 of the Multilateral Debt Relief Initiative (MDRI), the net asset value of ADF which is the basis for determining the value of the Bank's investment in the Fund declined, resulting in impairment loss on the Bank's investment. The net assets of ADF are composed of its net development resources less outstanding demand obligations plus disbursed and outstanding loans excluding balances due from countries that have reached their Heavily Indebted Poor Countries (HIPC) completion points and, are therefore due for MDRI loan cancelation at the balance sheet date.

Other Equity Participations

The Bank may take equity positions in privately owned productive enterprises and financial intermediaries, public sector companies that are in the process of being privatized or regional and sub regional institutions. The Bank's objective in such equity investments is to promote the economic development of its Regional Member Countries and, in particular, the development of their private sectors. The Bank's equity participation is also intended to promote efficient use of resources, promoting African participation, playing a catalytic role in attracting other investors and lenders and mobilizing the flow of domestic and external resources to financially viable projects, which also have significant economic merit.

Unless otherwise approved by the Board of Directors, the Bank's equity participation shall not exceed 25 per- cent of the equity capital of the entity in which it invests. The Bank does not seek a controlling interest in the companies in which it invests but closely monitors its equity investments through Board representation. In accordance with the Board of Governors' Resolution B/BG/2009/10 of 13 May 2009, total equity investment by the Bank shall not at any time exceed 15 percent of the aggregate amount of the Bank's paid-in capital and reserves and surplus (risk capital) included in its ordinary capital resources.

Under IFRS 9, equity investments must be measured at fair value through profit or loss. However, where the equity investment is not held for trading, an entity has the option to take fair value changes into Other Comprehensive Income (OCI), with no recycling of the change in fair value to profit or loss if the investment is subsequently derecognized. As the Bank's equity investments are currently held for strategic purposes of

enhancing development in Regional Member Countries rather than for trading, the Bank has opted to designate all its equity investments as at FVOCI.

For the year ended 31 December 2024, dividend income decreased by UA 0.26 million (1.27 percent) to UA 20.22 million from UA 20.48 million in December 2023.

The Bank's equity interests at the end of 2024 and 31 December 2023 are summarized below.

Composition of equity participation (UA thousands)

---

| | | | |
|:---|:---|:---|:---|
| **Institutions** | **Callable capital** | **2024** | **2023** |
| Investment in ADF |  | 111741 | 111741 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated share of profit/(loss) & impairment on 1 January |  | (49902) | (50953) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share of losses on equity accounted investments for the year |  | 282 | 374 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment for the year |  | (275) | 677 |
|  |  | 61846 | 61839 |
| **DIRECT INVESTMENTS** |  |  |  |
| **Development finance institutions** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Finance Corporation (AFC) |  | 50169 | 50521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Prudential PLC |  | 161 | 91 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa50—Project Development | 7180 | 1557 | 1821 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa50—Project Finance | 19158 | 62843 | 58642 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa50 IAF | 14787 | 458 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Export and Import Bank (AFREXIM) | 20802 | 96794 | 112663 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Guarantee Fund (AGF) |  | 14873 | 13663 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Afriland Properties PLC |  | 138 | 49 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Central African Development Bank (BDEAC) | 2187 | 2267 | 2317 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Development Bank of Nigeria |  | 19479 | 64072 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;East African Development Bank (EADB) | 10735 | 19723 | 18445 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Eastern and Southern African Trade and Development Bank (PTA) | 57663 | 145054 | 105521 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Great Lakes Development Bank (BDEGL) | 1000 | 3462 | 3457 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shelter Afrique (SHAF) |  | 7935 | 7714 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United Capital PLC |  | 641 | 1196 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;West African Development Bank (BOAD) | 5468 | 6080 | 7519 |
|  | 138980 | 431634 | 447691 |
| **Commercial banks** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;United Bank for Africa |  | 8789 | 11001 |
|  |  | 8789 | 11001 |
| **Microfinance institutions** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AB Microfinance Bank Nigeria Limited |  | 396 | 755 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Access Bank Liberia Limited |  | 1199 | 1127 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Access Bank Tanzania Limited | 5 | 75 | 115 |
|  | 5 | 1670 | 1997 |
| **Insurance** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Trade Insurance Agency |  | 18824 | 16572 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa-Re |  | 68291 | 61909 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CICA-RE | 3 | 6121 | 5945 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Eastern and Southern African Reinsurance Company (ZEP-RE) | 1 | 31356 | 29067 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dhamana Guarantee Company Limited | 2301 | 5368 |  |
|  | 2305 | 129960 | 113493 |
| **Real sectors companies** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kukuza Project Development Company | 2470 |  |  |
| **TOTAL DIRECT INVESTMENTS** | **143760** | **572053** | **574182** |
| **FUNDS** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adiwale | 2984 | 6542 | 3172 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ADP III | 10266 | 10003 | 5447 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AFIG Fund II LP | 1835 | 8251 | 9831 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Capital Works Holdings | 3869 | 13325 | 6928 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Forestry Fund II Limited | 1821 | 10965 | 10077 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AfricaGoGreen Fund | 4375 | 3254 | 1818 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Health Fund LLC | 2337 | 42 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Joint Investment Fund (AJIF—CITADEL) | 267 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Africa Renewable Energy Fund L.P |  | 3400 | 15714 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Agriculture Fund LLC (AAF) | 564 | 4952 | 4538 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Domestic Bond Fund | 9202 | 6587 | 6834 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Infrastructure Investment Fund | 8054 | 5090 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Infrastructure Investment Fund 2 (AIIF2) | 2036 | 5475 | 5574 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;African Infrastructure Investment Fund 2 (AIIF3) |  | 25597 | 29754 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AfricInvest FIVE |  | 13552 | 11311 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AfricInvest Fund 2 (AFRICINVEST2) | 55 | 515 | 882 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AfricInvest Fund 3 (AFRICINVEST3) | 46 | 9531 | 13038 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AFS LP | 1585 | 10351 | 8607 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agri-Vie Fund (AGRIVIE) |  | 2650 | 2572 |

---

---

| | | | |
|:---|:---|:---|:---|
| **Institutions** | **Callable capital** | **2024** | **2023** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;AIF |  | 14636 | 12970 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Alitheia IDF Fund | 2261 | 5441 | 5168 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;APIS Growth Fund I Africa LP | 2510 | 14012 | 21078 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Arch African Renewable Power Fund LP(ARPF) | 7537 | 10842 | 9733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ARCH Cold Chain Solutions East Africa F | 2602 | 4964 | 2680 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Argan Infrastructure Fund (ARGAN) | 1651 | 2285 | 4963 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Arm-Harith Infrastructure Investments Limited | 37 | 10109 | 10096 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Atlantic Coast Regional Fund (ACRF) | 2802 | 1645 | 2298 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Aureos Africa Fund (AUREOS) | 2711 | 361 | 312 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Azur Innovation Fund | 495 | 1424 | 778 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BluePeak Private Capital Fund | 943 | 7636 | 5190 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;BOOST PAF I | 315 | 11330 | 11643 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Business Partners International Southern Africa SME Fund | 1166 | 1117 | 1243 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Carlyle Sub-Saharan Africa Fund (CSSAF) | 746 | 22025 | 34733 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Catalyst Fund (CATALYST) | 5 | 402 | 563 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Catalyst II | 661 | 3010 | 2020 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cathay Africinvest Innovation Fund LLC | 2882 | 879 | 308 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cauris Croissance II Fund | 909 | 636 | 597 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction Equity Fund(CEF) | 9953 | 18377 | 18158 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ECP Africa Fund 4 (ECP4) | 1376 | 10138 | 9896 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ECP Africa Fund 2 (ECP2) | 3645 |  | 820 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ECP Africa Fund 3 (ECP3) |  | 6575 | 15194 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Eight Miles LLP |  | 2392 | 2546 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Enko Africa Private Equity Fund | 2541 | 295 | 1410 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Evolution III | 12181 | 2568 | 2490 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Evolution Fund II (Mauritius) LP | 2927 | 14156 | 12169 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Evolution One Fund (EVOLUTION ONE) | 54 | 143 | 139 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FEI-OGEF LP | 962 | 3890 | 4469 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FEI Ongrid | 8806 | 16250 | 12630 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fund for Agricultural Finance in Nigeria (FAFIN) | 128 | 1705 | 3275 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GEF Africa Sustainable Forestry Fund (GEF) | 156 | 6376 | 5890 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;GroFin Africa Fund (GROFIN) | 2123 |  | 31 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Helios Investors II Fund (HELIOS2) | 265 | 7399 | 7678 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I & P Afrique Entrepreneurs | 391 | 2000 | 2568 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I & P AFRIQUE ENTREPRENEURS | 1636 | 3046 | 2947 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment Fund for Health in Africa (IFHA) | 286 | 433 | 367 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IPDEV II | 981 | 2320 | 2010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Janngo Start Up Fund Senior | 1742 | 1830 | 2771 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kibo Fund II |  | 6808 | 8894 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maghreb Private Equity Fund 3 (MPEF4) | 1560 | 13731 | 15271 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maghreb Private Equity Fund 2 (MPEF2) | 21 |  | 53 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Maghreb Private Equity Fund 3 (MPEF3) | 638 | 4415 | 6472 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;MEDITERRANIA CAPITAL FUND III | 707 | 13723 | 10465 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Metier Sustainable Capital International Fund II L | 3731 | 11692 | 5114 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Moringa Mauritius Africa | 1254 | 2169 | 2642 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nigeria Infrastructure Debt Fund | 2 | 2098 | 3370 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Partech Africa Fund I | 4894 | 543 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pan African Housing Fund (PAHF) | 995 | 375 | 440 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pan African Infrastructure Development Fund 1 (PAIDF1) | 1 | 6375 | 22969 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pan African Infrastructure Development Fund 2 (PAIDF2) | 16920 | 3029 | 3386 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pembani Remgro Infrastructure Fund II | 13084 | 2252 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;PHATISA | 736 | 5403 | 3583 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;RH Africa Fund | 7274 | 3 | 74 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shore Capital Fund III | 3463 | 6933 | 6158 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TIDE AFRICA LP FUND |  | 3603 | 8683 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TIDE Africa II LP | 3571 | 1763 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Uhuru Growth Fund | 2366 | 3556 | 2192 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VEROD | 991 | 8774 | 7512 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;West Africa Emerging Markets Fund (WAEMF) | 237 | 2098 | 3067 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Yeelen Financial Fund | 2440 | 4659 | 2779 |
| **TOTAL FUNDS** | **194567** | **456731** | **483052** |
| **TOTAL DIRECT INVESTMENT AND FUNDS** | **338327** | **1028784** | **1057234** |
| **GRAND TOTAL** | **338327** | **1090631** | **1119073** |

---

*The cost of equity investments (excluding ADF) carried at fair value at 31 December 2024 amounted to UA 888.67 million (2023: UA 873.01 million)*

**NOTE J—PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS**

At 31 December 2024 and 31 December 2023, the Bank's property, equipment, and intangible assets were as follows.

Property, equipment and intangible assets

*(UA thousands)*

2024

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Land** | **Capital <br> work in <br> progress** | **Building& <br> improve- <br> ments\*** | **RoU assets** | **Equipment <br> & motor <br> vehicles** | **Furniture, <br> fixtures& <br> fittings** | **Total <br> property& <br> equipment** | **Computer <br> software** | **Property, <br> equipment <br> & intangible <br> assets** |
| **Cost:** | | | | | | | | | |
| Balance at 1 January | 1168 | 5873 | 103664 | 70452 | 108445 | 20811 | 310413 | 52353 | 362766 |
| Transfer |  | (1529) | 1205 |  | 324 |  |  |  |  |
| Additions during the year |  | 2506 | 217 | 14434 | 4598 | 575 | 22330 | 1909 | 24239 |
| Disposals during the year |  |  |  |  | (2143) | (331) | (2474) | (35) | (2509) |
| Balance at 31 December | **1168** | **6850** | **105086** | **84886** | **111224** | **21055** | **330269** | **54227** | **384496** |
| **Accumulated depreciation:** |  |  |  |  |  |  |  |  |  |
| Balance at 1 January |  |  | 65885 | 52588 | 97770 | 19475 | 235718 | 48920 | 284638 |
| Depreciation during the year |  |  | 17185 | 8922 | 4860 | 604 | 31571 | 3264 | 34835 |
| Disposals during the year |  |  |  |  | (2135) | (331) | (2466) | (34) | (2500) |
| Balance at 31 December | **-** | **-** | **83070** | **61510** | **100495** | **19748** | **264823** | **52150** | **316973** |
| **NBV: 31 December** | **1168** | **6850** | **22016** | **23376** | **10729** | **1307** | **65446** | **2077** | **67523** |

---

2023

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Land** | **Capital <br> work in <br> progress** | **Building& <br> improve- <br> ments\*** | **RoU assets** | **Equipment <br> & motor <br> vehicles** | **Furniture, <br> fixtures& <br> fittings** | **Total <br> property& <br> equipment** | **Computer <br> software** | **Property, <br> equipment <br> & intangible <br> assets** |
| **Cost:** | | | | | | | | | |
| Balance at 1 January | 1168 | 5907 | 102466 | 57820 | 105510 | 20835 | 293706 | 48158 | 341864 |
| Transfer |  | (2209) | 1220 |  | 989 |  |  |  |  |
| Additions during the year |  | 2175 | 118 | 12632 | 2788 | 267 | 17980 | 4213 | 22193 |
| Disposals during the year |  |  | (140) |  | (842) | (291) | (1273) | (18) | (1291) |
| Balance at 31 December | **1168** | **5873** | **103664** | **70452** | **108445** | **20811** | **310413** | **52353** | **362766** |
| **Accumulated depreciation:** |  |  |  |  |  |  |  |  |  |
| Balance at 1 January |  |  | 59129 | 43567 | 91966 | 19134 | 213796 | 43947 | 257743 |
| Depreciation during the year |  |  | 6814 | 9021 | 6632 | 632 | 23099 | 4991 | 28090 |
| Disposals during the year |  |  | (58) |  | (828) | (291) | (1177) | (18) | (1195) |
| Balance at 31 December | **-** | **-** | **65885** | **52588** | **97770** | **19475** | **235718** | **48920** | **284638** |
| **NBV: 31 December** | **1168** | **5873** | **37779** | **17864** | **10675** | **1336** | **74695** | **3433** | **78128** |

---

*\* Included in the building and improvement is the carrying amount (cost and accumulated depreciation) of the Head Quarter (HQ) building which management decided to discontinue use (accelerated depreciation), due to the reassessment of its useful life to zero .*

Gains/Losses on disposal of property and equipment

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Cost (See note J) | 2509 | 1291 |
| Accumulated depreciation (See note J) | (2500) | (1195) |
| Net book value | 9 | 96 |
| Sales proceeds | 54 | 16 |
| **Gains/(Losses) on disposal of property and equipment (Note O)** | **45** | **(80)** |

---

The table below shows the carrying amounts of the Right-of-use assets and lease liabilities and the movements during the year:

Movement in right of use assets and lease liabilities

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **Right of <br> Use Asset** | **Lease <br> Liabilities** |
| **As at 1 January 2023** | **14253** | **13885** |
| Additions | 12632 | 12463 |
| Depreciation expense | (9021) |  |
| Payments |  | (9654) |
| **As at 31 December 2023** | **17864** | **16694** |
| Additions | 14434 | 15645 |
| Depreciation expense | (8922) |  |
| Payments |  | (10378) |
| **As at 31 December 2024** | **23376** | **21961** |

---

**NOTE K—BORROWINGS**

As at 31 December 2024 and 31 December 2023, the Bank's borrowings were as follows.

Summary of borrowing portfolio

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Borrowings at fair value | 26196006 | 24562870 |
| Borrowings at amortized cost | 208024 | 213538 |
| **Total** | **26404030** | **24776408** |

---

The capital adequacy framework approved by the Board of Directors adopted the use of a single debt to usable capital ratio to monitor the Bank's leverage. The ratio caps the Bank's total outstanding debt at 100 percent of usable capital. Usable capital comprises the equity of the Bank and the callable capital of its non-borrowing members rated A- or better. The Bank's usable capital at 31 December 2024 was 68.10 billion (31 December 2023: UA 61.04 billion).

The Bank uses derivatives in its borrowing and liability management activities to take advantage of cost- saving opportunities and to lower its funding costs. Certain long-term borrowing agreements contain provisions that allow redemption at the option of the holder at specified dates prior to maturity.

Such borrowings are reflected in the tables on the maturity structure of borrowings using the put dates, rather than the contractual maturities. Management believes, however, that a portion of such borrowings may remain outstanding beyond their earliest indicated redemption dates.

The Bank has entered into cross-currency swap agreements with major international banks through which proceeds from borrowings are converted into a different currency and include a forward exchange contract providing for the future exchange of the two currencies in order to recover the currency converted. The Bank has also entered into interest rate swaps, which transform a floating rate payment obligation in a particular currency into a fixed rate payment obligation or vice-versa.

A summary of the Bank's borrowings portfolio at 31 December 2024 and 2023 was as follows.

Borrowings and swaps at 31 December 2024

*(UA millions)*

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | **Direct borrowings** | **Direct borrowings** | **Direct borrowings** | **Direct borrowings** | **Currency swap agreements (a)** | **Currency swap agreements (a)** | **Currency swap agreements (a)** | **Interest rate swaps** | **Interest rate swaps** | **Interest rate swaps** |
| <br>**Currency** | <br>**Rate type** | **Carried at <br> fair value** | **Carried at <br> amortized <br> cost** | **Weighted <br> average <br> cost(b) (%)** | **Weighted <br> average <br> maturity <br> (years)** | **Amount <br> (payable)/ <br> receivable** | **Weighted <br> average <br> cost<sup>(b)</sup> (%)** | **Average <br> maturity <br> (years)** | **Notional <br> amount <br> payable/ <br> (receivable)** | **Weighted <br> average <br> cost<sup>(b)</sup> (%)** | **Average <br> maturity <br> (years)** |
| **Euro** | Fixed | 4919.37 |  | 1.16 | 3.53 |  |  |  |  |  |  |
| **Euro** |  |  |  |  |  | 216.85 | 1.38 | 9.51 | 4983.85 | 1.13 | 3.32 |
| **Euro** | Adjustable |  |  |  |  | (6436.62) | 3.52 | 2.17 | (4983.85) | 3.55 | 3.32 |
| **Euro** |  |  |  |  |  |  |  |  |  |  |  |
| **GBP** | Fixed | 1587.89 |  | 1.75 | 0.91 |  |  |  |  |  |  |
| **GBP** |  |  |  |  |  | 1635.37 | 1.72 | 0.9 |  |  |  |
| **GBP** | Adjustable |  |  |  |  |  |  |  |  |  |  |
| **GBP** |  |  |  |  |  |  |  |  |  |  |  |
| **Japanese Yen** | Fixed | 810.72 | 38.91 | 0.52 | 30.16 |  |  |  |  |  |  |
| **Japanese Yen** |  |  |  |  |  | 979.55 | 0.61 | 30.56 |  |  |  |
| **Japanese Yen** | Adjustable | 222.06 |  | 3.87 | 2.49 | (8.89) | (0.24) | 5.64 | (10.77) | 0.07 | 0.41 |
| **Japanese Yen** |  |  |  |  |  | 233.24 | 3.68 | 5.76 | 10.77 | 2.62 | 0.41 |
| **US Dollar** | Fixed | 13357.81 |  | 3.11 | 2.31 |  |  |  |  |  |  |
| **US Dollar** |  |  |  |  |  | 1226.87 | 4.02 | 2.17 | 12521.91 | 3.01 | 2.33 |
| **US Dollar** | Adjustable | 76.45 |  | 4.50 | 1.26 | (6038.77) | 5.09 | 9.48 | (12605.02) | 5.12 | 2.32 |
| **US Dollar** |  |  |  |  |  | 4389.30 | 4.96 | 2.74 | 81.28 | 4.45 | 1.31 |
| **Others** | Fixed | 4762.74 | 74.62 | 2.80 | 3.63 |  |  |  |  |  |  |
| **Others** |  |  |  |  |  | 4908.51 | 2.81 | 4.11 | 1371.59 | 0.31 | 20.27 |
| **Others** | Adjustable | 458.95 | 95.01 | 4.21 | 5.11 | (2084.62) | 7.14 | 2.99 | (335.67) | 8.08 | 15.92 |
| **Others** |  |  |  |  |  | 847.95 | 2.99 | 7.06 |  |  |  |
| **Total** | Fixed | 25438.54 | 113.52 | 2.51 | 3.63 |  |  |  |  |  |  |
| **Total** |  |  |  |  |  | 8967.16 | 2.50 | 6.28 | 18877.35 | 2.32 | 3.89 |
| **Total** | Adjustable | 757.47 | 95.01 | 4.15 | 4.08 | (14568.89) | 4.69 | 5.32 | (17935.30) | 4.74 | 2.85 |
| **Total** |  |  |  |  |  | 5470.49 | 4.60 | 3.53 | 92.05 | 4.23 | 1.21 |
| Principal at face value |  | 26196.01 | 208.53 | 2.56 | 3.65 | (131.24) |  |  | 1034.10 |  |  |
| Net unamortized premium/discount |  |  | (0.51) |  |  | 1122.02 |  |  | 131.47 |  |  |
|  |  | 26196.01 | 208.02 | 2.56 | 3.65 | 990.78 |  |  | 1165.57 |  |  |
| Fair valuation adjustment |  |  |  |  |  | (1904.16) |  |  | (1689.35)<sup>(c)</sup> |  |  |
| **Total** |  | **26196.01** | **208.02** | **2.56** | **3.65** | **(913.38)** | **—** | **—** | **(523.78)** | **—** | **—** |

---

*Supplementary disclosure (direct borrowings): The carrying amount of borrowings at 31 December 2024 was UA 26,196.01 million and the estimated fair value was UA 26,395.11 million.*

*(a) Currency swap agreements include cross-currency interest rate swap.*

*(b) The average repricing period of the net currency obligations for adjustable-rate borrowings was six months. The rates indicated are those prevailing at 31 December 2024.*

*(c) These amounts are included in derivative assets and liabilities on the balance sheet. Slight differences may occur in totals due to rounding.*

Borrowings and swaps at 31 December 2023

*(UA millions)*

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | **Direct borrowings** | **Direct borrowings** | **Direct borrowings** | **Currency swap agreements (a)** | **Currency swap agreements (a)** | **Currency swap agreements (a)** | **Currency swap agreements (a)** | **Interest rate swaps** | **Interest rate swaps** | **Interest rate swaps** |
| <br>**Currency** | <br>**Rate type** | **Carried at <br> fair value** | **Carried at<br> amortized**<br> **cost** | **Weighted <br> average <br> cost<sup>(b)</sup> (%)** | **Weighted <br> average <br> maturity <br> (years)** | **Amount <br> (payable)/ <br> receivable** | **Weighted <br> average <br> cost<sup>(b)</sup> (%)** | **Average <br> maturity <br> (years)** | **Notional <br> amount <br> payable/ <br> (receivable)** | **Weighted <br> average <br> cost<sup>(b)</sup> (%)** | **Average <br> maturity <br> (years)** |
| **Euro** | Fixed | 5984.02 |  | 0.83 | 3.59 |  |  |  |  |  |  |
| **Euro** |  |  |  |  |  | 221.42 | 1.38 | 10.98 | 6084.83 | 0.82 | 3.43 |
| **Euro** | Adjustable |  |  |  |  | (5039.41) | 1.38 | 2.73 | (6084.83) | 3.91 | 3.43 |
| **Euro** |  |  |  |  |  | 142.36 | 3.97 | 0.94 |  |  |  |
| **GBP** | Fixed | 1986.52 |  | 1.57 | 1.71 |  |  |  |  |  |  |
| **GBP** |  |  |  |  |  | 2087.66 | 1.53 | 1.72 |  |  |  |
| **GBP** | Adjustable |  |  |  |  |  |  |  |  |  |  |
| **GBP** |  |  |  |  |  |  |  |  |  |  |  |
| **Japanese Yen** | Fixed | 939.83 | 49.53 | 0.51 | 4.32 |  |  |  |  |  |  |
| **Japanese Yen** |  |  |  |  |  | 1029.28 | 0.54 | 1.72 |  |  |  |
| **Japanese Yen** | Adjustable | 240.81 |  | 3.57 | 3.67 | (18.66) |  | 3.49 | (11.55) | (0.32) | 1.38 |
| **Japanese Yen** |  |  |  |  |  | 353.35 | 3.26 | 5.16 | 11.55 | 2.62 | 1.38 |
| **US Dollar** | Fixed | 10103.59 |  | 2.92 | 2.95 |  |  |  |  |  |  |
| **US Dollar** |  |  |  |  |  | 90.29 | 2.53 | 3.02 | 10369.13 | 2.87 | 2.97 |
| **US Dollar** | Adjustable | 159.74 |  | 4.15 | 0.57 | (6485.75) | 5.46 | 9.22 | (10541.67) | 4.56 | 2.93 |
| **US Dollar** |  |  |  |  |  | 3811.70 | 4.70 | 4.25 | 172.55 | 4.08 | 0.56 |
| **Others** | Fixed | 4741.66 | 74.54 | 2.92 | 3.82 |  |  |  |  |  |  |
| **Others** |  |  |  |  |  | 5095.35 | 2.79 | 4.65 | 1041.59 | 0.64 | 20.27 |
| **Others** | Adjustable | 406.70 | 89.83 | 2.50 | 5.25 | (1577.30) | 7.83 | 4.11 | (305.56) | 8.40 | 14.04 |
| **Others** |  |  |  |  |  | 334.00 | 0.36 | 8.21 |  |  |  |
| **Total** | Fixed | 23755.62 | 124.07 | 2.18 | 3.25 |  |  |  |  |  |  |
| **Total** |  |  |  |  |  | 8523.99 | 2.17 | 3.72 | 17495.54 | 2.02 | 4.16 |
| **Total** | Adjustable | 807.25 | 89.83 | 3.13 | 4.06 | (13121.12) | 5.13 | 6.11 | (16943.61) | 4.39 | 3.31 |
| **Total** |  |  |  |  |  | 4641.41 | 4.25 | 4.50 | 184.10 | 3.98 | 0.61 |
| Principal at face value |  | 24562.87 | 213.90 | 2.22 | 3.28 | 44.28 |  |  | 736.02 |  |  |
| Net unamortized premium/discount |  |  | (0.36) |  |  | 1211.72 |  |  | 127.50 |  |  |
|  |  | 24562.87 | 213.54 | 2.22 | 3.28 | 1256.00 |  |  | 863.52 |  |  |
| Fair valuation adjustment |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  | (2026.39) |  |  | (1506.62)<sup>(c)</sup> |  |  |
| **Total** |  | **24562.87** | **213.54** | **2.22** | **3.28** | **(770.39)** | **—** | **—** | **(643.11)** | **—** | **—** |

---

*Supplementary disclosure (direct borrowings): The carrying amount of borrowings at 31 December 2023 was UA 24,562.87 million and the estimated fair value was UA 24,768.99 million.*

*(a) Currency swap agreements include cross-currency interest rate swap.*

*(b) The average repricing period of the net currency obligations for adjustable-rate borrowings was six months. The rates indicated are those prevailing at 31 December 2023.*

*(c) These amounts are included in derivative assets and liabilities on the balance sheet. Slight differences may occur in totals due to rounding.*

The contractual (except for callable borrowings) maturity structure of outstanding borrowings as at 31 December 2024 was as follows.

Borrowings carried at fair value

*(UA millions)*

---

| | | | |
|:---|:---|:---|:---|
| **Periods** | **Ordinary** | **Callable** | **Total** |
| One year or less | 2995.29 | 420.90 | 3416.19 |
| More than one year but less than two years | 6341.94 | 218.68 | 6560.62 |
| More than two years but less than three years | 6394.97 | 135.57 | 6530.54 |
| More than three years but less than four years | 3900.59 | 111.92 | 4012.51 |
| More than four years but less than five years | 3651.86 | 99.01 | 3750.87 |
| More than five years | 1880.88 | 44.40 | 1925.28 |
| **Total** | **25165.53** | **1030.48** | **26196.01** |

---

Borrowings carried at amortized cost

*(UA millions)*

---

| | | | |
|:---|:---|:---|:---|
| **Periods** | **Ordinary** | **Callable** | **Total** |
| One year or less | 60.19 |  | 60.19 |
| More than one year but less than two years | 17.63 |  | 17.63 |
| More than two years but less than three years | 69.49 |  | 69.49 |
| More than three years but less than four years | 7.82 |  | 7.82 |
| More than four years but less than five years | 8.91 |  | 8.91 |
| More than five years | 44.49 |  | 44.49 |
| **Subtotal** | **208.53** | **—** | **208.53** |
| Net unamortized premium and discount | (0.51) |  | (0.51) |
| **Total** | **208.02** | **—** | **208.02** |

---

The contractual (except for callable borrowings) maturity structure of outstanding borrowings as at 31 December 2023 was as follows.

Borrowings carried at fair value

*(UA millions)*

---

| | | | |
|:---|:---|:---|:---|
| **Periods** | **Ordinary** | **Callable** | **Total** |
| One year or less | 3224.82 | 457.76 | 3682.58 |
| More than one year but less than two years | 2661.29 | 104.41 | 2765.70 |
| More than two years but less than three years | 5547.08 | 147.51 | 5694.59 |
| More than three years but less than four years | 5439.77 | 103.27 | 5543.04 |
| More than four years but less than five years | 3346.33 | 96.16 | 3442.49 |
| More than five years | 3293.47 | 141.00 | 3434.47 |
| **Total** | **23512.76** | **1050.11** | **24562.87** |

---

Borrowings carried at amortized cost

*(UA millions)*

---

| | | | |
|:---|:---|:---|:---|
| **Periods** | **Ordinary** | **Callable** | **Total** |
| One year or less | 106.07 |  | 106.07 |
| More than one year but less than two years | 33.60 |  | 33.60 |
| More than two years but less than three years |  |  |  |
| More than three years but less than four years | 74.23 |  | 74.23 |
| More than four years but less than five years |  |  |  |
| More than five years |  |  |  |
| **Subtotal** | **213.90** | **—** | **213.90** |
| Net unamortized premium and discount | (0.36) |  | (0.36) |
| **Total** | **213.54** | **—** | **213.54** |

---

The fair value of borrowings carried at fair value through profit or loss at 31 December 2024 was UA 26,196.01 million (December 2023: UA 24,562.87 million). For these borrowings, the amount the Bank will be contractually required to pay at maturity at 31 December 2024 was UA 29,154.12 million (December 2023: 27,332.93 million). The surrender value of callable borrowings is equivalent to the notional amount plus accrued finance charges.

As per Note P, there was a net loss of UA 7.81 million on borrowings, related derivatives and others for the year ended 31 December 2024 (2023: a gain of UA 59.48 million). The fair value movement attributable to changes in the Bank's credit risk included in the other comprehensive income for the year ended 31 December 2024 was a gain of UA 24.21 million (2023: a gain of UA 35.58 million).

Fair value movements attributable to changes in the Bank's credit risk are determined by comparing the discounted cash flows for the borrowings designated at fair value through profit or loss using the Bank's credit spread on the relevant liquid markets for AfDB quoted bonds versus market referenced rate both at the beginning and end of the relevant year. The Bank's credit spread was not applied for fair value changes on callable borrowings with less than one-year call date.

For borrowings designated at fair value through profit or loss at 31 December 2024, the cumulative unrealized fair value losses to date were UA 111.94 million (December 2023: UA 254.84 million).

**NOTE L—ACCOUNTS PAYABLE**

Accounts payable for the year ended 31 December 2024 and 31 December 2023 consists of:

Composition of accounts payable

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| **Accrued financial charges:** |  |  |
| Accrued interest on borrowings | 293409 | 205940 |
| Accrued interest payable on cross currency swaps | 510596 | 529028 |
| Accrued interest on lease liabilities | 113 | 98 |
| **Sub-total** | **804118** | **735066** |
| Other accounts payables | 709243 | 869098 |
| **Total accounts payable** | **1513361** | **1604164** |

---

**NOTE M—EQUITY**

Equity is composed of capital and reserves. These are further detailed as follows.

Capital

Capital includes subscriptions paid-in by member countries and Cumulative Exchange Adjustments on Subscriptions (CEAS). The Bank is not exposed to any externally imposed capital requirements.

Subscriptions Paid In

Subscriptions to the capital stock of the Bank are made up of the subscription to the initial capital, a voluntary capital increases, special capital increases and the seven General Capital Increases (GCI) made so far.

On 31 October 2019, the Board of Governors of the Bank approved a 125 percent increase of the capital resources of the institution. This seventh General Capital Increase (GCI-VII) increased the authorized capital stock of the Bank from UA 69,472 million to UA 153,191 million with the creation of 8,371,881 new shares. The new shares created were allocated to the regional and non-regional groups in such proportions that, when fully subscribed, the regional group shall hold 60 percent of the total capital stock of the Bank, and the non-regional group 40 percent. The new shares and the previous ones described above shall be divided into paid-up and callable shares in the proportion of 6 percent paid-up shares to 94 percent callable shares.

The paid-up portion of the GCI-VII subscription is payable in twelve annual instalments for member countries eligible to receive financing from ADF and eight annual instalments for member countries not eligible to receive financing from ADF. A member country's payment of the first installment triggers its subscription, and the entire callable shares are issued. Shares representing the paid-up portion of the subscription are issued only as and when the Bank receives the actual payments for such shares.

At the Fifty-Ninth Annual Meeting of the African Development Bank held on 29 May 2024, the Board of Governors approved, by Resolution B/BG/2024/09, the General Callable Capital Increase of UA 88,125,360,000 to preserve the Bank's lending capacity. This approval increased the Bank's authorized capital from UA 152,034,360,000 to UA 240,159,720,000.

The Bank's capital as at 31 December 2024 and 31 December 2023 was as follows.

Composition of paid-in capital

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Capital Authorized (in shares of UA 10 000 each) | 240159720 | 180638830 |
| Less: Unsubscribed | (76654919) | (32525952) |
| Subscribed Capital | 163504801 | 148112878 |
| Less: Callable Capital | (153532422) | (138177865) |
| Paid-up Capital | 9972379 | 9935013 |
| Shares to be issued upon payment of future installments | (2439487) | (2983920) |
| Add: Amounts paid in advance | 585 | 593 |
| **Capital** | **7533477** | **6951686** |

---

Included in the authorized data for 31 December 2024 is an amount of UA 38.83 million representing the balance of the shareholding of the former Socialist Federal Republic of Yugoslavia ("former Yugoslavia").

Since the former Yugoslavia has ceased to exist as a state under international law, its shares (composed of UA 38.83 million callable, and UA 4.86 million paid-up shares) have been held by the Bank in accordance with Article 6 (6) of the Bank Agreement. In 2002, the Board of Directors of the Bank approved the proposal to invite each of the successor states of the former Yugoslavia to apply for membership in the Bank, though such membership would be subject to their fulfilling certain conditions including the assumption pro-rata of the contingent liabilities of the former Yugoslavia to the Bank, as of 31 December 1992. In the event that a successor state declines or otherwise does not become a member of the Bank, the pro-rata portion of the shares of former Yugoslavia, which could have been reallocated to such successor state, would be reallocated to other interested non-regional members of the Bank in accordance with the terms of the Share Transfer Rules. The proceeds of such reallocation will however be transferable to such successor state. Furthermore, pending the response from the successor states, the Bank may, under its Share Transfer Rules, reallocate the shares of former Yugoslavia to interested non-regional member states and credit the proceeds on a pro-rata basis to the successor states. In 2003, one of the successor states declined the invitation to apply for membership and instead offered to the Bank, as part of the state's Official Development Assistance, its pro-rata interest in the proceeds of any reallocation of the shares of former Yugoslavia. The Bank accepted the offer.

Subscriptions by member countries and their voting power at 31 December 2024 were as follows.

Statement of subscriptions by member countries and voting power

*(UA thousands)*

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Member states** | **Total <br> shares** | **% of total <br> shares** | **Amount <br> paid** | **Callable <br> capital** | **Number of <br> votes** | **% of total <br> voting <br> power** |
| 1 Algeria | 773155 | 4.800 | 389853 | 7341680 | 773780 | 5.301 |
| 2 Angola | 153940 | 0.956 | 71797 | 1467612 | 143177 | 0.981 |
| 3 Benin | 30602 | 0.190 | 13633 | 292390 | 31227 | 0.214 |
| 4 Botswana | 112523 | 0.699 | 80095 | 1045130 | 107994 | 0.740 |
| 5 Burkina Faso | 59798 | 0.371 | 26660 | 571330 | 59766 | 0.409 |
| 6 Burundi | 30004 | 0.186 | 13272 | 286766 | 30629 | 0.210 |
| 7 Cabo Verde | 7938 | 0.049 | 3991 | 75400 | 7937 | 0.054 |
| 8 Cameroon | 235372 | 1.461 | 52575 | 2301161 | 135601 | 0.929 |
| 9 Central African Republic | 4988 | 0.031 | 1975 | 47912 | 5300 | 0.036 |
| 10 Chad | 8784 | 0.055 | 3974 | 83880 | 9409 | 0.064 |
| 11 Comoros | 1115 | 0.007 | 679 | 10476 | 1678 | 0.011 |
| 12 Republic of the Congo | 56379 | 0.350 | 26004 | 537800 | 51255 | 0.351 |
| 13 Côte d'Ivoire | 556636 | 3.456 | 244328 | 5322050 | 557261 | 3.818 |
| 14 Democratic Republic of Congo | 235894 | 1.465 | 66808 | 2292135 | 219850 | 1.506 |
| 15 Djibouti | 1213 | 0.008 | 1517 | 10610 | 1838 | 0.013 |
| 16 Egypt | 921766 | 5.723 | 468640 | 8749020 | 922391 | 6.319 |
| 17 Equatorial Guinea | 9588 | 0.060 | 7969 | 87913 | 10213 | 0.070 |
| 18 Eritrea | 4536 | 0.028 | 3178 | 42182 | 5161 | 0.035 |
| 19 Eswatini | 16441 | 0.102 | 11825 | 152590 | 17066 | 0.117 |
| 20 Ethiopia | 362396 | 2.250 | 92140 | 3531830 | 222026 | 1.521 |
| 21 Gabon | 66798 | 0.415 | 56747 | 611258 | 66876 | 0.458 |
| 22 Gambia | 18432 | 0.114 | 6823 | 177520 | 17929 | 0.123 |
| 23 Ghana | 307621 | 1.910 | 125974 | 2950211 | 308246 | 2.112 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Member states** | **Total <br> shares** | **% of total <br> shares** | **Amount <br> paid** | **Callable <br> capital** | **Number of <br> votes** | **% of total <br> voting <br> power** |
| 24 Guinea | 56794 | 0.353 | 22325 | 545630 | 54255 | 0.372 |
| 25 Guinea Bissau | 984 | 0.006 | 990 | 8860 | 1609 | 0.011 |
| 26 Kenya | 186876 | 1.160 | 75313 | 1793450 | 180044 | 1.233 |
| 27 Lesotho | 13106 | 0.081 | 6501 | 124570 | 13731 | 0.094 |
| 28 Liberia | 27686 | 0.172 | 11294 | 265591 | 26823 | 0.184 |
| 29 Libya | 507330 | 3.150 | 186004 | 4887307 | 306165 | 2.098 |
| 30 Madagascar | 94238 | 0.585 | 40324 | 902000 | 94863 | 0.650 |
| 31 Malawi | 45566 | 0.283 | 18942 | 436730 | 46191 | 0.316 |
| 32 Mali | 25444 | 0.158 | 20487 | 233957 | 26069 | 0.179 |
| 33 Mauritania | 7708 | 0.048 | 4912 | 72186 | 8333 | 0.057 |
| 34 Mauritius | 94168 | 0.585 | 52759 | 888860 | 94793 | 0.649 |
| 35 Morocco | 1107696 | 6.877 | 384494 | 10692470 | 693761 | 4.753 |
| 36 Mozambique | 136437 | 0.847 | 35105 | 1329287 | 84944 | 0.582 |
| 37 Namibia | 49557 | 0.308 | 23774 | 471800 | 46877 | 0.321 |
| 38 Niger | 49161 | 0.305 | 13562 | 478052 | 31149 | 0.213 |
| 39 Nigeria | 1359298 | 8.439 | 760036 | 12832950 | 1359923 | 9.317 |
| 40 Rwanda | 19594 | 0.122 | 8043 | 187896 | 19123 | 0.131 |
| 41 São Tomé and Príncipe | 9092 | 0.056 | 3626 | 87314 | 9200 | 0.063 |
| 42 Senegal | 135681 | 0.842 | 57384 | 1299442 | 136306 | 0.934 |
| 43 Seychelles | 4203 | 0.026 | 3291 | 38741 | 4828 | 0.033 |
| 44 Sierra Leone | 15893 | 0.099 | 12985 | 145951 | 16518 | 0.113 |
| 45 Somalia | 4300 | 0.027 | 3157 | 39846 | 4924 | 0.034 |
| 46 South Africa | 732928 | 4.550 | 350278 | 6979010 | 733553 | 5.026 |
| 47 South Sudan | 42266 | 0.262 | 6665 | 416010 | 42891 | 0.294 |
| 48 Sudan | 14034 | 0.087 | 14160 | 126177 | 14659 | 0.100 |
| 49 Tanzania | 117091 | 0.727 | 46532 | 1124387 | 117716 | 0.806 |
| 50 Togo | 23804 | 0.148 | 9770 | 228276 | 23191 | 0.159 |
| 51 Tunisia | 210073 | 1.304 | 109165 | 1991560 | 210698 | 1.444 |
| 52 Uganda | 56563 | 0.351 | 24582 | 541062 | 56546 | 0.387 |
| 53 Zambia | 170406 | 1.058 | 73967 | 1630070 | 171031 | 1.172 |
| 54 Zimbabwe | 248981 | 1.546 | 105080 | 2384744 | 239783 | 1.643 |
| **Total regionals** | **9542877** | **59.248** | **4255964** | **91173042** | **8577107** | **58.763** |
| 55 Argentina | 11024 | 0.068 | 7185 | 103060 | 11649 | 0.080 |
| 56 Austria | 64252 | 0.399 | 34864 | 607660 | 64877 | 0.444 |
| 57 Belgium | 93548 | 0.581 | 61730 | 873750 | 94173 | 0.645 |
| 58 Brazil | 21791 | 0.135 | 16970 | 200940 | 22416 | 0.154 |
| 59 Canada | 560607 | 3.481 | 365840 | 5240240 | 561232 | 3.845 |
| 60 China | 185651 | 1.153 | 100591 | 1755920 | 186276 | 1.276 |
| 61 Denmark | 168660 | 1.047 | 91882 | 1594720 | 169285 | 1.160 |
| 62 Finland | 70046 | 0.435 | 35225 | 665240 | 70671 | 0.484 |
| 63 France | 538171 | 3.341 | 270625 | 5111090 | 538796 | 3.691 |
| 64 Germany | 952360 | 5.913 | 325334 | 9198270 | 600590 | 4.115 |
| 65 India | 41376 | 0.257 | 21906 | 391860 | 42001 | 0.288 |
| 66 Ireland | 116570 | 0.724 | 40041 | 1125670 | 117195 | 0.803 |
| 67 Italy | 349229 | 2.168 | 189445 | 3302850 | 349854 | 2.397 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Member states** | **Total <br> shares** | **% of total <br> shares** | **Amount <br> paid** | **Callable <br> capital** | **Number of <br> votes** | **% of total <br> voting <br> power** |
| 68 Japan | 792484 | 4.920 | 430132 | 7494710 | 793109 | 5.434 |
| 69 Korea | 68968 | 0.428 | 34375 | 655310 | 69593 | 0.477 |
| 70 Kuwait | 63983 | 0.397 | 32175 | 607660 | 64608 | 0.443 |
| 71 Luxembourg | 29709 | 0.184 | 13140 | 283950 | 30334 | 0.208 |
| 72 Netherlands | 201450 | 1.251 | 68288 | 1946220 | 127685 | 0.875 |
| 73 Norway | 169596 | 1.053 | 91848 | 1604120 | 170221 | 1.166 |
| 74 Portugal | 34471 | 0.214 | 17415 | 327300 | 35096 | 0.240 |
| 75 Saudi Arabia | 27763 | 0.172 | 13965 | 263670 | 26571 | 0.182 |
| 76 Spain | 154377 | 0.958 | 100670 | 1443100 | 155002 | 1.062 |
| 77 Sweden | 359000 | 2.229 | 122482 | 3467520 | 226784 | 1.554 |
| 78 Switzerland | 210657 | 1.308 | 110800 | 1995780 | 211282 | 1.448 |
| 79 Türkiye | 56839 | 0.353 | 25135 | 543260 | 57464 | 0.394 |
| 80 U.K. | 271589 | 1.686 | 177620 | 2538270 | 272214 | 1.865 |
| 81 U.S.A. | 949506 | 5.895 | 477830 | 9017240 | 950131 | 6.509 |
| **Total non-regionals** | **6563677** | **40.752** | **3277513** | **62359380** | **6019109** | **41.237** |
| **Grand total** | **16106554** | **100.000** | **7533477** | **153532422** | **14596216** | **100.000** |

---

*The subscription position including the distribution of voting rights at 31 December 2024 reflects the differences in the timing of subscription payments by member countries during the allowed subscription payment period for GCI V,GCI-VI and GCI-VII. After the shares have been fully subscribed, the regional and non-regional groups are expected to hold 60 percent and 40 percent voting rights, respectively. Slight differences may occur in totals due to rounding.*

Cumulative Exchange Adjustment on Subscriptions (CEAS)

Prior to the fourth General Capital Increase (GCI-IV), payments on the share capital subscribed by the non- regional member countries were fixed in terms of their national currencies. Under GCI-IV, and subsequent capital increases payments by regional and non-regional members in US Dollars were fixed at an exchange rate of 1 UA = US$1.20635. This rate represented the value of the US Dollar to the SDR immediately before the introduction of the basket method of valuing the SDR on 1 July 1974 (1974 SDR). As a result of these practices, losses or gains could arise from converting these currencies to UA when received. Such conversion differences are reported in the Cumulative Exchange Adjustment on Subscriptions account.

At 31 December 2024 and 31 December 2023, the Cumulative Exchange Adjustment on Subscriptions were as follows.

Cumulative exchange adjustment on subscriptions

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Balance at 1 January | 151635 | 154169 |
| Net conversion losses on new subscriptions | (4929) | (2534) |
| **Balance** | **146706** | **151635** |

---

Reserves

The reserves increased by UA 271.41 million (6.76 percent) from UA 4,014.34 million as at 31 December 2023 to UA 4,285.76 million as at 31 December 2024. This increase is due to the total comprehensive income for the year.

Retained Earnings

Retained earnings include the net income for the year after taking into account transfers approved by the Board of Governors, and net charges recognized directly in equity. Retained earnings also include the transition adjustments resulting from the adoption of new or revised financial reporting standards, where applicable.

At 31 December 2024 and 31 December 2023, the retained earnings were as follows.

Movement in retained earnings (UA thousands)

---

| | |
|:---|:---|
| Balance at 1 January 2023 | 3465408 |
| Net income for the current year | 360047 |
| **Balance at 31 December 2023** | **3825455** |
| Net income for the current year | 248412 |
| Hybrid capital—Issue transaction costs | (2831) |
| Hybrid capital—Discretionary coupon | (16271) |
| **Balance at 31 December 2024** | **4054765** |

---

Cash Flow Hedge Reserve

A cash flow hedge reserve is a reserve that records the effective portion of gains or losses on a hedging instrument and reclassification adjustments to the income statement in the same period (s) in which the forecast cashflows affect the income statement. Details of the movement in the reserve in 2024 is disclosed in Note G—Hedge Accounting.

Hybrid Capital Instrument (HCI) Reserve

The Bank issued subordinated and perpetual notes or hybrid capital with 5.75 percent resettable coupon rate on 30 January 2024. The hybrid capital issue had a proceed of UA 563.86 million (USD 750 million) with a 0.5 percent transaction cost of UA 2.83 million (USD 3.75 million). The Bank has the sole and absolute discretion to call or redeem the hybrid capital (or on the occurrence of certain or repurchase events) and to pay the discretionary coupon and principal to the holders. The discretionary coupon is non-accruing and would only be deemed payable to the holders, if and only if declared and approved by the Bank. If a trigger event occurs, and the set threshold (7.5x) is breached, payment of the discretionary coupon must be canceled. Also, the hybrid capital would be written down if certain events occur.

Based on its terms, the hybrid capital meets the definition of equity under IFRS and was consequently classified and presented under equity in the financial statements. As such, all amounts received from the issue (e.g. proceeds) and all payment amounts (e.g. transaction costs and discretionary coupons) would be directly recorded in equity. Also, the hybrid capital would be recorded at historical cost and would not be remeasured over time.

Details of the Subordinated Notes and Hybrid Capital are presented below.

Terms of hybrid capital instrument issuance

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Initial issue <br> date** | **First call date** | **Initial nominal <br> value <br> (currency) <br> (USD <br> thousands)** | **Initial <br> nominal value <br> (UA thousands)** | **Initial <br> currency** | **Rate** | **Carrying <br> amount at <br> 31 December <br> 2024 <br> (UA thousands)** |
| 30-Jan-24 | 30-Aug-34 | 750000 | 563859 | USD | 5.75% | 563859 |

---

The fixed discretionary coupon rate on the hybrid capital has a reset mechanism on the first reset date of Au- gust 2034 and every 5 years thereafter at a reset rate equal to the prevalent 5-year US Treasury + 157.5 bps. If the hybrid capital is not called or redeemed at the first call date, the coupon rate would be reset in line with the above stated mechanism.

The first **Hybrid Capital Discretionary coupon** of UA 16.27 million (USD 21.56 million) was paid to Hybrid Capital investors in August 2024 from equity of the Bank.

Hybrid Capital Trigger Event Ratio as at 31 December 2024

The diagram below shows the ratio of total assets to paid-in capital and reserves for the year ended. The threshold is set 7.5x.

Hybrid capital trigger event ratio

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| | |
|:---|:---|
| Total assets/Paid-in capital and reserves (< limit 7.5x) | 3.47 |
| Distance to trigger event (UA millions) | 6573.31 |

---

Allocable Income

Allocable income is a management performance measure for making distributions out of its net income to reserves and developmental activities. Allocable income is net income before distribution approved by the Board, adjusted for the impact of volatile unrealized elements of gains or losses on borrowings at fair value and related derivatives and currency translation gains or losses and hybrid capital adjustments.

At 31 December 2024 and 31 December 2023, allocable income was as follows.

Allocable income (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Net Income before distribution approved by the Board of Governors | 354412 | 406047 |
| *Adjustment for volatile elements of gains and losses:* |  |  |
| Unrealized (gains)/losses on borrowings and derivatives | 7813 | (59478) |
| Translation (gains)/losses | 1266 | 10976 |
| *Total Adjustment for volatile elements of gains and losses* | 9079 | (48502) |
| Paid—Hybrid Capital Transaction cost | (2831) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Hybrid Capital Discretionary coupons | (16271) |  |
| Projected—Hybrid Capital Discretionary coupons\* | (13135) |  |
| *Total Hybrid Capital Adjustments\*\** | (32237) |  |
| **Allocable income** | **331254** | **357545** |

---

*\* The projected Hybrid Capital discretionary coupon was estimated at UA 13.14 million as at 31 December 2024 and would be recognized directly in equity if the Bank elects to declare, approve and pay at the next discretionary coupon date.*

*\*\* Hybrid Capital Adjustments—includes transaction costs on the instrument issuance, discretionary coupons approved and paid from the equity of the Bank and projected discretionary coupon yet to be declared, approved and paid from the equity of the Bank.*

During the year, the Board of Governors approved the distribution of UA 106 million (2023: UA 46.00 million) from income and the surplus account to certain entities for development purposes. With effect from 2006, Board of Governors approved distributions to entities for development purposes are reported as expenses in the Income Statement in the year such distributions are approved.

Movement in the surplus account during 2024 and 2023 is as follows.

Movement in surplus account

*(UA thousands)*

---

| | |
|:---|:---|
| Balance at 1 January 2023 | 122 |
| Allocation from 2022 net income |  |
| **Balance at 31 December 2023** | **122** |
| Balance at 1 January 2024 | 122 |
| Allocation from 2023 net income | 47550 |
| Distribution to Special Relief Fund | (9000) |
| Distribution to MIC Technical Assistance Fund | (10000) |
| Distribution to the NEPAD | (2000) |
| Distribution to Alliance for Green Infrastructure in Africa (AGIA) | (15000) |
| Distribution to ADF's Climate Action Window | (10000) |
| **Balance at 31 December 2024** | **1672** |

---

Distributions to entities for development purposes, including those made from the surplus account, for the years ended 31 December 2024 and 2023 were as follows.

Distributions of income approved by the Board of Governors

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| African Development Fund (ADF) | 60000 | 35000 |
| Post Conflict Assistance—DRC |  | 11000 |
| MIC Technical Assistance Fund | 10000 |  |
| Special Relief Fund | 9000 |  |
| New Partnership for Africa's Development Infrastructure Project Preparation Facility | 2000 |  |
| Alliance for Green Infrastructure in Africa—Project Development Facility (AGIA) | 15000 |  |
| Climate Action Window | 10000 |  |
| **Total** | **106000** | **46000** |

---

**NOTE N—INCOME FROM LOANS AND TREASURY INVESTMENTS AND RELATED DERIVATIVES**

Income from Loans and Related Derivatives

Income from loans and related derivatives for the year ended 31 December 2024 and 31 December 2023 was as follows.

Income from loans and related derivatives

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Interest income on loans not impaired | 1262719 | 1103529 |
| Interest income on impaired loans | 43419 | 31788 |
| Interest on loan swaps | 72763 | 66345 |
| **Total interest income on loans** | **1378901** | **1201662** |
| Commitment fees | 43001 | 36257 |
| Guarantee fees | 10942 | 1238 |
| **Total fee income** | **53943** | **37495** |
| Balance sheet optimization (BSO) fees | (13838) | (15607) |
| **Total** | **1419006** | **1223550** |

---

Analysis of Interest Income from Loans by Operations

Composition of interest income on loans

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Interest income on sovereign loans | 1058494 | 908457 |
| Interest income on non-sovereign loans | 247644 | 226860 |
| Interest on loan swaps | 72763 | 66345 |
| **Total interest income on loans** | **1378901** | **1201662** |

---

Income from Treasury Investments and Related Derivatives

Income from Treasury Investments and related derivatives for the year ended 31 December 2024 and 31 December 2023 was as follows.

Income from treasury investments and related derivatives

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Interest income | 453766 | 340984 |
| Realized fair value gains on investments | 77169 | 88148 |
| Unrealized fair value gains on investments | 3556 | 30472 |
| Subtotal | 80725 | 118620 |
| **Total** | **534491** | **459604** |

---

Total interest income on Treasury investments at amortized cost for the year ended 31 December 2024 was UA 185.49 million (2023: UA 127.44 million). Interest income on treasury investments includes UA 26.65 mil- lion (2023: nil) from investments acquired with the proceeds of the hybrid capital.

Net Interest Income

The Net Interest Income for the year ended 31 December 2024 and 31 December 2023 was as follows.

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Interest income from loans | 1378901 | 1201662 |
| Interest income from treasury investment | 453766 | 340984 |
| Other debt securities | 11692 | 7938 |
| Total Interest Income | 1844359 | 1550584 |
| Borrowing expenses (Note P) | (1402739) | (1191709) |
| **Net Interest Income** | **441620** | **358875** |

---

**NOTE O—OTHER INCOME**

Other Income represents net earnings that arise from other sources and activities apart from the Bank's development related activities and Investment activities. They are as follows for the year ended 31 December 2024 and 31 December 2023:

Composition of other income

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Management fees | 9454 | 8584 |
| Rental income | 1051 | 1222 |
| Miscellaneous Income | 6728 | 5029 |
| Board allowances received | 192 | 462 |
| Share of profits/(losses) in associate | 282 | 374 |
| Gains/(losses) on disposal of property and equipment | 45 | (80) |
| Others | 2262 | 2727 |
| **Total** | **20014** | **18318** |

---

**NOTE P—BORROWING EXPENSES**

Interest and Amortized Issuance Costs

Interest and amortized issuance costs on borrowings for the year ended 31 December 2024 and 31 December 2023 was as follows.

Interest and amortization of issuance costs

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Charges to bond issuers | 644386 | 514823 |
| Amortization of issuance costs | 3213 | 538 |
| Interest on operating lease | 373 | 326 |
| **Total (a)** | **647972** | **515686** |

---

Total interest expense for financial liabilities not at fair value through profit or loss for the year ended 31 December 2024 was UA 16.64 million (December 2023: UA 16.29 million).

Net Interest on Borrowing and Related Derivatives

Net interest on borrowing-related derivatives for the year ended 31 December 2024 and 31 December 2023 was as follows.

Net interest on borrowings and related derivatives

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Interest on derivatives payable | 1610266 | 1394441 |
| Interest on derivatives receivable | (855499) | (718418) |
| **Total (b)** | **754767** | **676023** |
| **Net Borrowing Expenses (a+b)** | **1402739** | **1191709** |

---

Losses or Gains on Borrowings and Related Derivatives

Gains/losses on borrowings, related derivatives and others for the year ended 31 December 2024 and 31 December 2023 was as follows.

Losses or gains on borrowings and related derivatives

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Gains on derivatives | 68521 | 612913 |
| Losses on borrowings | (129797) | (674272) |
| Gains on hedged loans | 53463 | 120837 |
| **(Losses)/Gains on borrowings and related derivatives** | **(7813)** | **59478** |

---

The gains on borrowings, related derivatives and others include the income statement effects of the hedge accounting, consisting of unrealized loss of UA 0.81 million (December 2023: unrealized gain of UA 2.30 million), representing hedge effectiveness and a gain of UA 1.73 million (December 2023: gain of UA 1.87 million) of amortization of fair value adjustments on the hedged risk (See Note G).

Valuation adjustment loss in respect of counterparty risk of derivative financial assets (CVA) for the year ended 31 December 2024 amounted to a loss of UA 4.48 million (December 2023: loss of UA 8.55 million), whilst valuation adjustment gain relating to credit risk in derivative financial liabilities (DVA) for the year ended 31 December 2024 was UA 25.73 million (December 2023: a gain UA 21.46 million).

**NOTE Q—ADMINISTRATIVE EXPENSES**

Total administrative expenses relate to expenses incurred for the operations of the Bank and those incurred on behalf of the ADF and the NTF. The ADF and NTF reimburse the Bank for their share of the total administrative expenses, based on an agreed-upon cost-sharing formula, which is driven primarily by the staff time spent on individual entity's work program deliverables. However, the expenses allocated to the NTF shall not exceed 20 percent of the NTF's gross income.

Administrative expenses for the year ended 31 December 2024 and 31 December 2023 comprised the following.

Administrative expenses (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Manpower expenses\* | 384734 | 223970 |
| Other general expenses | 79926 | 82713 |
| **Total** | **464660** | **306683** |
| Reimbursable by ADF | (256151) | (172325) |
| Reimbursable by NTF | (818) | (1242) |
| **Net** | **207691** | **133116** |

---

*\* Shares of AfDB manpower expenses amount to UA 242.53 million (2023: UA 107.85 million). In 2023, there was a one-off reduction (gains) of UA 100.46 million due to the extension of staff retirement age from 62 to 65 years.*

The amount reimbursable to AfDB by ADF and NTF is based on the cost sharing ratio applied on the Bank's Group's manpower expenses, other general expenses, depreciation and amortization expenses.

Included in general administrative expenses is an amount of UA 0.17 million (2023: UA 0.12 million) incurred under operating lease agreements for offices in Côte d'Ivoire and in certain member countries, where the Bank has offices, the short-term leases and leases of low value not recognized as liabilities. The payments in relation to these are recognized as an expense in income statement.

**NOTE R—EMPLOYEE BENEFITS**

Staff Retirement Plan

The Staff Retirement Plan (SRP), a defined benefit plan established under Board of Governors' Resolution 05–89 of 30 May 1989, became effective on 31 December 1989, following the termination of the Staff Prov- ident Fund. Every person employed by the Bank on a full-time basis, as defined in the Bank's employment policies, is eligible to participate in the SRP, upon completion of 6 months service without interruption of more than 30 days. The SRP is administered as a separate fund by a committee of trustees appointed by the Bank on behalf of its employees.

In November 2004, the Board of Directors of the Bank approved certain revisions to the SRP, including simplification of the calculation of the employee contribution rate, more explicit reference to the Bank's residual responsibility and rights as the SRP sponsor, changes in survivor child benefits and an increase in the pension accumulation rate from 2 percent to 2.5 percent for each year of service. Also, new members from the Field Offices of the Bank joined the Plan in 2007. Accordingly, the associated past service costs associated with these changes were reported in the financial statements of respective years.

In 2008, the early retirement provisions and the death benefits to spouses were modified, resulting in a net negative prior service cost of UA 8.12 million, which was immediately recognized. Under the revised SRP, employees contribute at a rate of 9 percent of regular salary. A tax factor included in the basis for the determination of contribution in the previous SRP has been eliminated. The Bank typically contributes twice the employee contribution but may vary such contribution based on the results of annual actuarial valuations.

In 2011, the Board of Directors approved the extension of the mandatory staff retirement age in the Bank from 60 to 62 years effective 1 January 2012. Participants of the Plan as of 11 May 2011 were given up to 31 December 2012 to make the election on either to retire at 60 years with no penalty for early retirement or accept the extension and retire at age 62. The option to retire at age 60 is not available to staff joining the Bank from 1 January 2012, the date of effectiveness of the change. Most of the existing participants opted for

the revised retirement age. The impact of the change on the actuarial valuation of SRP was a curtailment of UA 10.90 million and was reported in the financial statements for the year ended 31 December 2011.

In 2015, the Board of Directors approved changes to enhance financial sustainability of the Plan. These changes primarily included review of the commutation of pension as well as benefits applicable for death in retirement.

In 2022, the Board of Directors approved the extension of the mandatory staff retirement age in the Bank from 62 to 65 years, effective 1 January 2023. Staff in service as of 31 December 2022 had the option to maintain their previous retirement age or choose the option to retire at age 65.

The Hybrid Scheme

On 19th September 2018, the Board of Directors approved changes to the Staff Retirement Plan (SRP or the Plan) introducing an alternative pension structure combining the features of a defined benefit (DB) and a defined contribution (DC) scheme to strengthen the Plan's long-term sustainability, while giving flexibility to members.

The effective date of the hybrid scheme is 1 July 2019. The hybrid scheme is aimed at strengthening the Plan's long-term financial viability and grants qualifying participants the flexibility to decide where to invest their contributions with the choice to contribute additional voluntary contributions to their personal DC ac- counts. Qualifying participants in the service of the Bank before the effective date will have the option to join the new hybrid scheme or remain in the current DB scheme. These changes will not affect the acquired pension rights of current plan participants or retirees' pension benefits. However, qualifying participants joining the plan from the effective date will automatically be enrolled in the new hybrid scheme i.e. the SRP and the newly introduced defined contribution plan.

The features of the hybrid scheme are stated below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Participants and the Bank will continue to contribute 9 percent and 18 percent of salaries respectively
under the hybrid scheme.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The Bank's median salary will be used as the cap and will be reset every three years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Contributions will be split between the DB and the DC at the median salary cap as follows;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Participants earning up to the median salary cap will contribute to the DB scheme and have only DB benefits
at retirement; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Participants with salaries higher than the median salary cap will contribute to the DB up to the median
salary and will contribute the excess over the median salary to the DC. In effect, participants under the hybrid scheme will have benefits
from both the DB and DC plans at retirement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Participants with the DC plan will have the right to determine where their contributions will be invested
and the flexibility to make additional voluntary contributions to their DC accounts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Funds in the DC component will be invested by external fund managers for each participant's account
and related management fees will be deducted directly from each participant's account.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• The DB benefits will remain under the administration of the Staff Retirement Plan.

Medical Benefit Plan

The Medical Benefit Plan (MBP) was created under the Board of Directors' resolution B/BD/2002/17 and F/ BD/2002/18 of 17 July 2002 and became effective on 1 January 2003. Under the MBP, all plan members including existing staff or retirees contribute a percentage of their salary or pension while the Bank typically contributes twice the employee contribution but may vary such contribution based on the results of annual actuarial valuations.

Contribution rates by staff members and retirees are based on marital status and number of eligible children. An MBP board, composed of selected officers of the Bank and representatives of retirees and the staff

association, oversees the management and activities of the MBP. The contributions from the Bank, staff and retirees are deposited in a trust account. In accordance with the directive establishing the Plan, all Plan members including staff and retirees are eligible as beneficiaries for making claims for medical services provided to them and their recognized dependents.

On 7 January 2015, the Board of Directors approved a new set of contribution rates to the MBP for the Bank, active staff and retirees. The new set of rates were with effect from 1 September 2015 and aim at enhancing the long-term financial sustainability of the Plan.

For the DC component of the hybrid plan, the amount recognized in the income statement for the year ended 31 December 2024 was UA 2.61 million (2023: UA 1.47 million). This amount is included in Other Accounts Payable.

The post-employment scheme of staff retirement and medical benefit expenses for 2024 and 2023 for the Bank, the ADF and the NTF combined (the Bank Group) comprised the following.

Pension plan benefit costs

*(UA millions)*

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Staff Retirement Plan** | **Staff Retirement Plan** | **Medical Benefit Plan** | **Medical Benefit Plan** |
| | **2024** | **2023** | **2024** | **2023** |
| Current service cost—gross | 42.39 | 38.53 | 31.39 | 21.52 |
| Past service cost amendments |  | (102.88) |  | (9.04) |
| Less: employee contributions | (13.77) | (13.40) | (4.79) | (4.49) |
| Net current service cost | 28.62 | (77.75) | 26.60 | 7.99 |
| Interest cost | 38.39 | 36.68 | 16.31 | 11.91 |
| Interest income on plan assets | (40.71) | (38.88) | (4.77) | (4.64) |
| **Increase/(reduction) in expense for the year** | **26.30** | **(79.95)** | **38.14** | **15.26** |

---

At 31 December 2024, the Bank had a net employee benefit assets related to the SRP amounting to UA 97.87 million (2023: UA 36.88 million) while the Bank's liability to the post-employment aspect of the MBP amounted to UA 266.20 million (2023: UA 266.84 million).

At 31 December 2024 and 2023, the determination of these liabilities is set out below.

Composition of funded status of SRP and MBP

*(UA millions)*

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Staff Retirement Plan** | **Staff Retirement Plan** | **Medical Benefit Plan** | **Medical Benefit Plan** |
| | **2024** | **2023** | **2024** | **2023** |
| **Fair value of plan assets:** |  |  |  |  |
| Market value of plan assets at beginning of year | 1012.10 | 883.17 | 113.89 | 100.79 |
| Actual return on assets | 84.60 | 121.15 | 2.83 | 3.47 |
| Employer's contribution | 27.71 | 26.80 | 10.20 | 8.96 |
| Plan participants' contribution during the year | 13.77 | 13.40 | 4.79 | 4.49 |
| Benefits paid | (32.81) | (32.42) | (5.51) | (3.82) |
| Market value of plan assets at the end of the year | **1105.37** | **1012.10** | **126.20** | **113.89** |
| **Present value of defined benefit obligation:** |  |  |  |  |
| Benefit obligation at beginning of year | 975.22 | 949.93 | 380.73 | 262.46 |
| Current service cost | 28.62 | 25.13 | 26.60 | 17.03 |
| Employee contributions | 13.77 | 13.40 | 4.79 | 4.49 |
| Interest cost | 38.39 | 36.68 | 16.31 | 11.91 |
| Actuarial loss/(gain) | (15.69) | 85.38 | (30.53) | 97.70 |
| Benefits paid | (32.81) | (32.42) | (5.50) | (3.82) |
| Past service cost amendments |  | (102.88) |  | (9.04) |
| Benefit obligation at end of year | **1007.50** | **975.22** | **392.40** | **380.73** |
| **Funded status:** |  |  |  |  |
| Net employee benefit assets/liabilities recognized on the balance sheet at 31 December | **97.87** | **36.88** | **(266.20)** | **(266.84)** |

---

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Amount recognized on the Balance sheet— Employee Benefit Assets | **97.87** | **36.88** |
| Amount recognized on the Balance sheet— Employee Benefit liabilities | **(266.20)** | **(266.84)** |

---

At 31 December 2024, the cumulative net actuarial gains recognized directly in equity through other com- prehensive income for the SRP were UA 92.22 million (2023: gains of UA 32.64 million). The cumulative net actuarial losses recognized directly in equity through other comprehensive income for MBP was a loss of UA 37.11 million (2023: losses of UA 65.69 million).

The following summarizes the funding status of the SRP at the end of the last five fiscal years.

Funding status of SRP for the past 5 years

*(UA millions)*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2024** | **2023** | **2022** | **2021** | **2020** |
| **Staff Retirement Plan:** |  |  |  |  |  |
| Fair value of plan assets | 1105.37 | 1012.10 | 883.17 | 1063.85 | 908.50 |
| Present value of defined benefit obligation | (1007.50) | (975.22) | (949.93) | (1309.16) | (1286.25) |
| **Net funding** | **97.87** | **36.88** | **(66.76)** | **(245.31)** | **(377.75)** |
| Actuarial gains and losses on plan assets | 182.79 | 138.90 | 56.63 | 261.14 | 125.36 |
| Actuarial gains and losses on plan liabilities | (90.57) | (106.26) | (20.88) | (446.98) | (493.18) |
| **Net** | **92.22** | **32.64** | **35.75** | **(185.84)** | **(367.82)** |

---

The funding status of the Medical Benefit Plan at the end of the last five fiscal years was as follows.

Funding status of MBP for the past 5 years

*(UA millions)*

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2024** | **2023** | **2022** | **2021** | **2020** |
| **Medical Benefit Plan:** |  |  |  |  |  |
| Fair value of plan assets | 126.20 | 113.89 | 100.79 | 89.97 | 80.02 |
| Present value of defined benefit obligation | (392.40) | (380.73) | (262.46) | (293.34) | (335.19) |
| **Deficit funding** | **(266.20)** | **(266.84)** | **(161.67)** | **(203.37)** | **(255.17)** |
| Actuarial gains and losses on plan assets | (11.93) | (9.99) | (8.82) | (8.93) | (10.36) |
| Actuarial gains and losses on plan liabilities | (25.18) | (55.70) | 42.01 | (19.66) | (87.14) |
| **Net** | **(37.11)** | **(65.69)** | **33.19** | **(28.59)** | **(97.50)** |

---

Assumptions used in the latest available actuarial valuations at 31 December 2024 and 2023 were as follows.

Actuarial valuation assumptions used

*(Percentage)*

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Staff Retirement Plan** | **Staff Retirement Plan** | **Medical Benefit Plan** | **Medical Benefit Plan** |
| | **2024** | **2023** | **2024** | **2023** |
| Discount rate | 4.40 | 4.40 | 4.40 | 4.40 |
| Rate of salary increase | 3.30 | 3.30 | 3.30 | 3.30 |
| Future pension increase | 2.20 | 2.20 |  |  |
| Health care cost growth rate |  |  | 7.00 | 7.00 |

---

The discount rate used in determining the benefit obligation is selected by reference to the long-term year- end rates on AA corporate bonds from the different markets of the five currencies of the SDR. The medical cost inflation assumption is the rate of increase in the cost of providing medical benefits. This is influenced by a wide variety of factors, such as economic trends, medical developments, and patient utilization. For the purposes of these calculations, the medical cost inflation rate was assumed at 7 percent per annum.

The Bank's obligation and costs for post-retirement medical benefits are highly sensitive to assumptions regarding medical cost inflation.

The average duration of SRP and MBP is 16 years and 21 years, respectively. The following table shows projected benefit cash flow outgo.

Projected cash outflow from pension plans (UA millions)

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **2026** | **2027** | **2028** | **2029** | **2030 to <br> 2034** |
| Cash flow from MBP | 6.67 | 7.64 | 8.95 | 10.57 | 84.52 |
| Cash flow from SRP | 40.76 | 44.25 | 51.57 | 55.19 | 311.07 |

---

The following table shows the effects of a one-percentage-point change in the assumed health care cost growth rate.

Sensitivity analysis of health care cost growth rate (UA thousands)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **1% increase** | **1% increase** | **1% decrease** | **1% decrease** |
| | **2024** | **2023** | **2024** | **2023** |
| Effect on total service and interest cost | 13418 | 13456 | (10147) | (10123) |
| Effect on post-retirement benefit obligation | 91870 | 92029 | (72570) | (72420) |

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The following table shows the effect of a 1 percentage point change in the discount rate for the SRP.

Sensitivity analysis of discount rate for SRP (UA thousands)

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **1% increase** | **1% increase** | **1% decrease** | **1% decrease** |
| | **2024** | **2023** | **2024** | **2023** |
| Effect on total service and interest cost | 7244 | 7357 | (9503) | (9736) |
| Effect on post-retirement benefit obligation | 129147 | 131303 | (162098) | (166054) |

---

No SRP assets are invested in any of the Bank's own financial instruments, nor any property occupied by, or other assets used by the Bank. All investments are held in active markets.

The following table presents the weighted-average asset allocation at 31 December 2024 and 2023 for the Staff Retirement Plan.

Asset allocation for the Staff Retirement Plan (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Debt securities | 465135 | 310909 |
| Equity securities | 543658 | 623905 |
| Property | 77085 | 69385 |
| **Total** | **1085878** | **1004199** |

---

At 31 December 2024 and 2023, the assets of the MBP were invested primarily in short-term deposits and bonds.

The Bank's estimate of contributions it expects to make to the SRP and the MBP for the year ending 31 December 2025, are UA 23.50 million and UA 37.92 million, respectively.

**NOTE S—RELATED PARTIES**

The following related parties have been identified.

The Bank makes or guarantees loans to some of its members who are also its shareholders and borrows funds from the capital markets in the territories of some of its shareholders. As a multilateral development institution with membership comprising 54 African states and 27 non-African states (the "regional members" and "non-regional members", respectively), subscriptions to the capital of the Bank are made by all its members. All the powers of the Bank are vested in the Board of Governors, which consists of the Governors appointed by each member country of the Bank, who exercise the voting power of the appointing member country. Member country subscriptions and voting powers are disclosed in Note M. The Board of Directors, which is composed of twenty (20) Directors elected by the member countries, is responsible for the conduct of the general operations of the Bank, and for this purpose, exercises all the powers delegated to it by the Board of Governors. The Bank also makes or guarantees loans to certain of the agencies of its Regional Member Countries and to public and private enterprises operating within such countries. The Board of Di- rectors approves such loans.

In addition to its ordinary resources, the Bank administers the resources of other entities under special arrangements. In this regard, the Bank administers the resources of the ADF. Furthermore, the Bank administers various special funds and trust funds, which have purposes that are consistent with its objectives of promoting the economic development and social progress of its Regional Member Countries. In this connection, the Bank administers the NTF as well as certain multilateral and bilateral donor funds created in the form of grants.

The ADF was established pursuant to an agreement between the Bank and certain countries. The general operation of the ADF is conducted by a 14-member Board of Directors of which 7 members are selected by the Bank. The Bank exercises 50 percent of the voting power in the ADF and the President of the Bank is the ex-officio President of the Fund. To carry out its functions, the ADF utilizes the officers, staff, organization, services and facilities of the Bank, for which it reimburses the Bank based on an agreed cost-sharing formula, driven primarily by the staff time spent on individual entity's work program deliverables.

The Bank's investment in the ADF is included in Equity Participations and disclosed in Note I. In addition to the amount reported as equity participation, the Bank periodically makes allocations from its income to the Fund, to further its objectives. Net income allocations by the Bank to ADF are reported as Other Resources in the Fund's financial statements.

The NTF is a special fund administered by the Bank with resources contributed by the Government of Nige- ria. The AfDB Board of Directors conducts the general operations of NTF on the basis of the terms of the NTF Agreement and in this regard, the Bank consults with the Government of Nigeria. The NTF also utilizes the offices, staff, organization, services and facilities of the Bank for which it reimburses to the Bank its share of administrative expenses for such utilization. The share of administrative expenses reimbursed to the Bank by both the ADF and NTF is disclosed in Note Q.

Grant resources administered by the Bank on behalf of other donors, including its member countries, agencies and other entities are generally restricted for specific uses, which include the co-financing of Bank's lending projects, debt reduction operations and technical assistance for borrowers including feasibility studies. Details of the outstanding balance on such grant funds at 31 December 2024 and 31 December 2023 are disclosed in Note V-5.

The Bank charges fees for managing some of these funds. Management fees received by the Bank for the year ended 31 December 2024 amounted to UA 9.45 million (2023: UA 8.58 million). The Bank also administers the SRP and MBP. The activities of the SRP and MBP are disclosed in Note R.

Management Personnel Compensation

Compensation paid to the Bank's management personnel and executive directors during the year ended 31 December 2024 and 31 December 2023 were made up as follows.

Key management personnel compensation (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Salaries | 36365 | 30735 |
| Termination and other benefits | 9386 | 8518 |
| Contribution to retirement and medical plan | 7885 | 6663 |
| **Total** | **53636** | **45916** |

---

The Bank may also provide personal loans and advances to its staff, including those in management. Such loans and advances, guaranteed by the terminal benefits payable at the time of departure from the Bank, are granted in accordance with the Bank's rules and regulations. As of 31 December 2024, outstanding balances on loans and advances to management staff and executive directors amounted to UA 13.95 million (31 December 2023: UA 9.11 million).

**NOTE T—SEGMENT REPORTING**

The Bank is a multilateral development finance institution dedicated to the economic and social progress of its regional member states. The Bank's products and services are similar and are structured and distributed in a fairly uniform manner across borrowers. Based on the evaluation of the Bank's operations, management has determined that AfDB has only one reportable segment since the Bank does not manage its operations by allocating resources based on a determination of the contribution to net income from individual borrowers. The products and services from which the Bank derives its revenue are mainly loans, treasury and equity participation.

The Bank's development activities are divided into five sub-regions of the continent of Africa for internal management purposes, namely: Central Africa, Eastern Africa, Northern Africa, Southern Africa, and Western Africa. Activities involving more than one single country from the continent of Africa are described as multi- national activities. Treasury investment activities are carried out mainly outside the continent of Africa and are therefore not included in the table below. In presenting information on the basis of the above geographical areas, revenue is based on the location of customers.

Geographical information about income from loans for the years ended 31 December 2024 and 2023 is detailed as follows.

Income from loans by segments (UA thousands)

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Central <br> Africa** | **Eastern <br> Africa** | **Northern <br> Africa** | **Southern <br> Africa** | **Western <br> Africa** | **Multi- <br> national** | **Total** |
| **2024** |  |  |  |  |  |  |  |
| Income from sovereign loans | 85583 | 141545 | 400667 | 335101 | 185357 | (1354) | 1146899 |
| Income from non-sovereign loans | 10666 | 36617 | 40875 | 43808 | 80902 | 59239 | 272107 |
|  | **96249** | **178162** | **441542** | **378909** | **266259** | **57885** | **1419006** |
| **2023** |  |  |  |  |  |  |  |
| Income from sovereign loans | 72429 | 107421 | 359141 | 299920 | 142714 | (5731) | 975894 |
| Income from non-sovereign loans | 9967 | 38036 | 34463 | 76188 | 62681 | 26321 | 247656 |
|  | **82396** | **145457** | **393604** | **376108** | **205395** | **20590** | **1223550** |

---

Revenues earned from transactions with a single borrower country of the Bank and exceeding 10 percent of the Bank's revenue for one country amounted to UA 276.20 million for the year ended 31 December 2024 (2023: UA 400.11 million).

As of 31 December 2024, land and buildings owned by the Bank were located primarily at the Bank's head- quarters in Abidjan, Côte d'Ivoire. More than 90 percent of other fixed and intangible assets were located at the regional resource centers in Nairobi, Pretoria and Tunis.

**NOTE U—APPROVAL OF FINANCIAL STATEMENTS**

On March 26, 2025, the Board of Directors authorized these financial statements for issue to the Board of Governors. The financial statements are expected to be approved by the Board of Governors at its annual meeting in May 2025.

**NOTE V—SUPPLEMENTARY DISCLOSURES**

**NOTE V-1: EXCHANGE RATES**

The rates used for translating currencies into Units of Account at 31 December 2024 and 31 December 2023 were as follows.

---

| | | | |
|:---|:---|:---|:---|
| | | **2024** | **2023** |
| 1 UA = 1 SDR = | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Algerian Dinar | 175.81400 | 180.10000 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Angolan Kwanza | 1189.36656 | 1111.97610 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Australian Dollar | 2.08362 | 1.97888 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Botswana Pula | 17.96330 | 17.99030 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brazilian Real | 8.03426 | 6.52426 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Canadian Dollar | 1.87535 | 1.77933 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Chinese Yuan Renminbi | 9.51910 | 9.58727 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CFA Franc | 823.10800 | 798.64700 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Danish Kroner | 9.35962 | 9.07779 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Egyptian Pound | 66.29754 | 41.44419 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ethiopian Birr | 163.95530 | 74.70270 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Euro | 1.25482 | 1.21753 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gambian Dalasi | 91.13000 | 84.69963 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ghanaian Cedi | 19.17071 | 15.93904 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Guinean Franc | 11217.77000 | 11420.37700 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indian Rupee | 110.94400 | 111.49100 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Japanese Yen | 204.29300 | 190.45400 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kenyan Shilling | 168.61449 | 209.92010 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Korean Won | 1891.39000 | 1749.80000 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Kuwaiti Dinar | 0.40161 | 0.41163 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Libyan Dinar | 6.41097 | 6.40688 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mauritian Rupee | 61.52980 | 59.30040 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Moroccan Dirham | 13.18658 | 13.27301 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;New Zambian Kwacha | 36.36006 | 34.49474 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;New Zealand Dollar | 2.30984 | 2.13282 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nigerian Naira | 2002.20770 | 1206.71560 |

---

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Norwegian Krone | 14.81560 | 13.72210 |
| Pound Sterling | 1.03952 | 1.05381 |
| São Tomé Dobra | 30.59300 | 29.58510 |
| Saudi Arabian Riyal | 4.89390 | 5.02074 |
| South African Rand | 23.97700 | 24.71770 |
| Swedish Krona | 14.41040 | 13.46050 |
| Swiss Franc | 1.16929 | 1.14526 |
| Tanzanian Shilling | 3124.60390 | 3292.57540 |
| Tunisian Dinar | 4.15300 | 4.11316 |
| Turkish Lira | 46.09660 | 39.61710 |
| Ugandan Shilling | 4786.50922 | 5074.47769 |
| United States Dollar | 1.30413 | 1.34167 |
| Vietnamese Dong | 31736.00355 | 32474.45152 |

---

*No representation is made that any currency held by the Bank can be or could have been converted into any other currency at the cross rates resulting from the rates indicated above.*

**NOTE V-2: OTHER DEVELOPMENT ASSISTANCE ACTIVITIES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) Transition Support Facility

The Transition Support Facility (TSF) traces its origins to the Post-Conflict Country Facility (PCCF), established in 2004 to assist countries emerging from conflict in their efforts to re-engage with the donor community. Its primary objective was to reactivate development assistance and support these countries in reaching the Heavily Indebted Poor Countries (HIPC) decision point, enabling them to qualify for debt relief after clearing their arrears to the Bank Group. The PCCF pooled resources from the AfDB's net income, ADF contributions, and other donors, providing financial assistance on a case-by-case basis to post-conflict countries that had made maximum efforts to clear their arrears.

To further strengthen support for fragile states, the Fragile States Facility (FSF) was established in 2008, succeeding the PCCF. The FSF introduced a broader and more integrated framework for assisting eligible states, with a focus on consolidating peace, stabilizing economies, and laying the foundation for sustainable poverty reduction and long-term economic growth. The FSF was structured around three key windows: (i) The Supplemental Support Window; (ii) The Arrears Clearance Window; and (iii) The Targeted Support Window.

In 2014, the Bank's Strategy for Addressing Fragility and Building Resilience in Africa (2014–2019) introduced further refinements to the FSF, ultimately leading to the establishment of the Transition Support Facility (TSF). These changes included: (i) The introduction of the 'transition states' concept, whereby eligibility for TSF financing was determined through a combination of quantitative and qualitative assessments; (ii) The creation of the TSF Unallocated Reserve, providing flexible resources for crisis response in the face of exogenous shocks; and (iii) An increase in the minimum level of TSF resources allocated to each transition state.

To enhance its flexibility and impact, the TSF underwent significant reforms in 2023 to align with the ambition of the Bank's Strategy for Addressing Fragility and Building Resilience in Africa (2022–2026). The TSF transitioned from a mechanism that primarily provided supplementary financing to one that also supported programmatic and thematic interventions aimed at tackling the root causes of fragility. To achieve this, the Unallocated Reserve of the TSF was restructured into two distinct components: (i) The Prevention Envelope, available for preventive interventions in any ADF country; and (ii) The Response Envelope, designated for crisis response triggered by external shocks. Preventive interventions are selected through annual Calls-for- Proposals, while crisis responses are managed on a case-by-case basis depending on emerging needs.

One notable recent reform was the establishment of TSF Pillar IV—the Donor Contributions Window, introduced under the 2024 Updated TSF Operational Guidelines. Recognizing that fragility is a spectrum affecting all RMC to varying degrees, the Bank introduced Pillar IV as a flexible financing platform to attract voluntary donor contributions while ensuring strategic alignment with the Bank's fragility agenda. Unlike the existing three TSF pillars, which rely on multilateral ADF replenishments and AfDB Net Income allocations, Pillar IV enables bilateral and multilateral partners to contribute additional resources, either earmarked or non- earmarked, to strengthen resilience-building efforts across the continent.

Since its establishment, the TSF has mobilized over UA 4.9 billion, supporting investment and institutional support projects in most vulnerable situations in Africa. The Facility continues to serve as a critical financing instrument for addressing fragility and conflict-related challenges, leveraging the Bank's expertise and partnerships across the Humanitarian-Development-Peace (HDP) nexus to maximize impact.

ii) Heavily Indebted Poor Countries (HIPC) Initiative

The Bank participates in a multilateral initiative for addressing the debt problems of countries identified as HIPCs. Under this initiative, creditors provide debt relief for eligible countries that demonstrate good policy performance over an extended period to bring their debt burdens to sustainable levels. Under the original HIPC framework, selected loans to eligible beneficiary countries were paid off by the HIPC Trust Fund at a price equivalent to the lower of the net present value of the loans or their nominal values, as calculated using the methodology agreed under the initiatives.

Following the signature of a HIPC debt relief agreement, the relevant loans were paid off at the lower of their net present value or their carrying value. On average, loans in the AfDB's portfolio carry higher interest rates than the present value discount rates applied and therefore the net present value of the loans exceeds the book value. Consequently, affected AfDB loans were paid off by the HIPC Trust Fund at book values.

The HIPC initiative was enhanced in 1999 to provide greater, faster and more poverty-focused debt relief. This was achieved by reducing the eligibility criteria for qualification under the initiative and by commencing debt relief much earlier than under the original framework. Under the enhanced framework, where 33 African countries are eligible, the debt relief is delivered through annual debt service reductions, as well as the release of up to 80 percent of annual debt service obligations as they come due until the total debt relief is provided. In addition, interim financing between the decision and completion points of up to 40 percent of total debt relief is provided whenever possible within a 15-year horizon.

As at end December 2024, the implementation of the HIPC initiative shows that out of the 33 eligible countries, 31 RMC have reached their completion points. Two (2) countries (Eritrea and Sudan) have yet to complete the requirements for HIPC debt relief. Somalia successfully implemented a poverty reduction strategy and maintained a track record of sound macroeconomic management as evidenced by the satisfactory implementation of the IMF Extended Credit Facility (ECF). This enabled Somalia to successfully reach the HIPC Completion Point on December 13, 2023.

iii) Multilateral Debt Relief Initiative (MDRI)

At the Gleneagles Summit on 8 July 2005, the Group of 8 major industrial countries agreed on a proposal for the ADF, the International Development Association (IDA), and the International Monetary Fund (IMF) to cancel 100 percent of their claims on countries that have reached, or will reach, the completion point under the enhanced HIPC Initiative.

The main objective of the MDRI is to complete the process of debt relief for HIPCs by providing additional resources to help 38 countries worldwide, 33 of which are in Africa, to make progress towards achieving the Millennium Development Goals (MDGs), while simultaneously safeguarding the long-term financing capacity of the ADF and the IDA. The debt cancelation would be delivered by relieving post-completion-point HIPCs' repayment obligations and adjusting their gross assistance flows downward by the same amount. To maintain the financial integrity of the ADF, donors have committed to make additional contributions to the ADF to match "dollar-for-dollar" the foregone principal and service charge payments.

The MDRI became effective for the ADF on 1 September 2006. As of that date, the ADF wrote down its balance of disbursed and outstanding loans net of HIPC relief by an amount of UA 3.84 billion, with a corresponding decrease as of that date in the ADF's net assets. Reduction in ADF net assets results in a decrease in the value of the Bank's investment in the Fund. Subsequent writedown of loan balances is effected as and when other countries reach their HIPC completion point and are declared beneficiaries of MDRI loan cancelation. The reduction in the net asset value of the ADF does not include loans outstanding to MDRI countries that have not reached their HIPC completion points at the end of the year.

**NOTE V-3: SPECIAL FUNDS**

Under Article 8 of the Agreement establishing the Bank, the Bank may establish or be entrusted with the administration of special funds.

At 31 December 2024 and 2023, the following funds were held separately from those of the ordinary capital resources of the Bank:

**i) The Nigeria Trust Fund (NTF)** was established under an agreement signed on 26 February 1976 (the Agreement) between the African Development Bank and the Federal Republic of Nigeria. The Agreement stipulates that the NTF shall be in effect for a period of 30 years from the date the Agreement became effective and that the resources of the NTF shall be transferred to the Government of Nigeria upon termination. However, the 30-year sunset period may be extended by mutual agreement between the Bank and the Federal Republic of Nigeria.

Following the initial expiry of the agreement on 26 April 2006, and the successful completion of independent reviews of its performance, the Agreement has been extended several times, most recently for five years from 25 April 2023.

The initial capital of the NTF was NGN 50 million payable in two equal installments of NGN 25 million each, in freely convertible currencies. The first installment, equivalent to USD 39.90 million, was received by the Bank on 14 July 1976, and payment of the second installment, equivalent to USD 39.61 million, was made on 1 February 1977.

During May 1981, the Federal Republic of Nigeria announced the replenishment of the NTF with 50 million naira. The first installment of NGN 35 million (USD 52.29 million) was paid on 7 October 1981. The second installment of NGN 8 million (USD 10.87 million) was received on 4 May 1984. The payment of the third installment of NGN 7 million (USD 7.38 million) was made on 13 September 1985.

During the year ended 31 December 2014, the Government of the Federal Republic of Nigeria authorized the withdrawal of an amount of US$13 million (UA 8.41 million) from reserves to settle its commitment on the arrears clearance of debt owed by Liberia under the internationally coordinated arrears clearance mechanism for Post Conflict Countries.

During the year ended 31 December 2015, following a request by the Government of Nigeria, on 13 May 2015, a withdrawal of USD 10 million (UA 7.14 million) was made from the resources of the Fund and paid to the Government of Nigeria.

The resources of the NTF at 31 December 2024 and 2023 are summarized below.

Abridged financial statements of the NTF

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Contribution received | 128586 | 128586 |
| Funds generated (net) | 161158 | 156014 |
| Adjustment for translation of currencies | (87313) | (93046) |
|  | **202431** | **191554** |
| Represented by: |  |  |
| Due from banks | 18259 | 3500 |
| Investments | 102715 | 94928 |
| Accrued income and charges receivable on loans | 236 | 277 |
| Accrued interest on investments | 513 | 504 |
| Other amounts receivable | 1140 | 763 |
| Loans outstanding | 91697 | 92542 |
|  | **214560** | **192514** |
| Less: Net accounts payable | (12129) | (960) |
|  | **202431** | **191554** |

---

**ii) The Special Relief Fund (for African countries affected by drought)** was established by Board of Governors' Resolution 20–74 to assist African countries affected by unpredictable disasters. The purpose of this fund was subsequently expanded in 1991 to include the provision of assistance, on a grant basis, to research institutions whose research objectives in specified fields are likely to facilitate the Bank's objective of meeting the needs of Regional Member Countries in those fields. The resources of this Fund consist of contributions by the Bank, the ADF and various member states.

The summary statement of the resources and assets of the Special Relief Fund (for African countries affected by drought) as at 31 December 2024 and 2023 follows.

Abridged financial statements of the Special Relief Fund

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Fund balance | 141267 | 132462 |
| Funds generated | 7496 | 6751 |
| Funds allocated to Social Dimensions of Structural Adjustment (SDA) | 2 | 2 |
| Less: Relief disbursed | (136909) | (134755) |
|  | **11856** | **4460** |
| Represented by: |  |  |
| Due from bank | 1106 | 1330 |
| Investments | 10738 | 3102 |
| Net accounts receivable | 12 | 28 |
|  | **11856** | **4460** |

---

At 31 December 2024, a total of UA 5.67 million (USD 7.39 million) compared with UA 2.72 million (US$3.65 million) in 2023, had been committed but not yet disbursed under the Special Relief Fund.

**iii) Africa Growing Together Fund (AGTF):** Pursuant to the Board of Governors resolution B/BG/2014/06 of 22 May 2014, the agreement establishing the Africa Growing Together Fund was signed between the Bank and the Peoples Bank of China on

22 May 2014 to co-finance alongside the AfDB eligible sovereign and non-sovereign operations. Following the entry into force of the AGTF agreement, an initial contribution of USD 50 million towards the Fund was received by the Bank on 28 November 2014.

The summary statement of the resources and assets of the Africa Growing Together Fund as at 31 December 2024 and 2023 follows.

Abridged financial statements of the Africa Growing Together Fund

*(UA thousands)*

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| Contribution received | 569588 | 455388 |
| Funds generated (net) | (57718) | (33221) |
|  | **511870** | **422167** |
| Represented by: |  |  |
| Due from bank | 18062 | 31511 |
| Investments | 10727 | 1061 |
| Loans outstanding | 496487 | 389861 |
| Accrued income and charges receivable on loans and investments | 17776 | 9177 |
| Less: Current accounts payable | (31182) | (9443) |
|  | **511870** | **422167** |

---

**NOTE V-4: TRUST FUNDS**

The Bank has been entrusted, under Resolutions 11–70, 19–74 and 10–85 of the Board of Governors, with the administration of the Mamoun Beheiry Fund, the Arab Oil Fund, and the Special Emergency Assistance Fund for Drought and Famine in Africa. These funds, held separately from those of the ordinary capital resources of the Bank, are maintained and accounted for in specific currencies, which are translated into Units of Account at exchange rates prevailing at the end of the year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **The Mamoun Beheiry Fund** was established under Board of Governors' Resolution 11–70
of 31 October 1970, whereby Mr. Mamoun Beheiry, former President of the Bank, agreed to set up a fund, which could be used by the
Bank to reward staff members who had demonstrated outstanding performance in fostering the objectives of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• **The Special Emergency Assistance Fund for Drought and Famine in Africa (SEAF)** was established by
the 20th Meeting of Heads of State and Governments of member countries of the African Union formerly Organization of African Unity (OAU)
held in Addis Ababa, Ethiopia, from 12 to 15 November 1984, under Resolution AHG/Res. 133 (XX), with the objective of giving assistance
to African member countries affected by drought and famine.

The financial highlights of these Trust Funds at 31 December 2024 and 2023 are summarized below.

Abridged financial statements of Mamoun Beheiry Fund and Special Emergency Assistance Fund for Drought and Famine in Africa (UA thousands)

---

| | | |
|:---|:---|:---|
| | **2024** | **2023** |
| **Mamoun Beheiry Fund** |  |  |
| Contribution | 152 | 152 |
| Income from investments | 183 | 173 |
|  | 335 | 325 |
| Less: Prize awarded | (46) | (46) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gift | (25) | (25) |
|  | **264** | **254** |
| Represented by: |  |  |
| Due from banks | 264 | 254 |
|  | **264** | **254** |
| **Special Emergency Assistance Fund for Drought and Famine in Africa** |  |  |
| Contributions | 22722 | 22722 |
| Funds generated | 7844 | 7812 |
|  | **30566** | **30534** |
| Less: Relief disbursed | (29303) | (29303) |
|  | **1263** | **1231** |
| Represented by: |  |  |
| Banks and Investment | 1263 | 1231 |
|  | 1263 | 1231 |
| **Total Resources & Assets of Trust Funds** | **1527** | **1485** |

---

**NOTE V-5: GRANTS (DONOR FUNDS)**

The Bank administers grants on behalf of donors, including member countries, agencies and other entities. Resources for Grants are restricted for specific uses, which include the co-financing of the Bank's lending projects, debt reduction operations, technical assistance for borrowers including feasibility studies and project preparation, global and regional programs and research and training programs. These funds are placed in trust and are not included in the assets of the Bank. In accordance with Article 11 of the Agreement establishing the Bank, the accounts of these grants are kept separate from those of the Bank.

The undisbursed balances of the grant resources at 31 December 2024 and 2023 were as follows.

Undisbursed balances of grants (UA thousands)

---

| | | |
|:---|:---|:---|
| **Trust Fund name** | **2024** | **2023** |
| AFAWA Risk Sharing Facility | 55576 | 51293 |
| Africa Circular Economy Facility | 2463 | 2131 |
| Africa Climate Change Fund | 19456 | 19061 |
| Africa Digital Financial Inclusion | 22783 | 20955 |
| Africa Disaster Risk Trust Fund | 39617 | 31079 |
| Africa Growing Together Fund | 30021 | 33318 |
| Africa Integrity Fund | 45553 | 43923 |
| Africa Investment Facility | 34240 | 51662 |
| Africa Renewable Energy Initiative | 2621 | 2692 |
| Africa Trade Fund | 2419 | 2734 |
| Africa Water Facility Fund | 45205 | 44614 |
| African Energy Leaders Group | 402 | 379 |
| African Legal Support Facility | 17985 | 19115 |
| Agriculture fast track fund | 508 | 494 |
| Agri-Food SME Catalytic Financing Mechanism (IF) | 66402 | 63611 |
| AMINA | 1683 | 1639 |
| Bill & Melinda Gates Foundation TCA | 1634 | 6922 |
| Boost Africa Entrepreneurs Lab Trust Fund | 609 | 1026 |
| Boost Africa Financial Instrument (PAGODA) | 5701 | 2269 |
| Boost Africa Technical Assistance (PAGODA) | 2393 | 234 |
| Canada AfDB Climate Fund Financial instrument and Technical Assistance | 71024 | 80756 |
| Canadian Grant for Technical Assistance | 261 | 265 |
| Capital Market Development Trust Fund | 6719 | 5641 |
| Chinese Government Fund | 283 | 277 |
| Clean Technology Fund | 102805 | 122524 |
| Climate Development | 3920 | 5249 |
| Congo Basin Forest Fund | 12111 | 12150 |
| Economic Development Cooperation Fund (KAIEF-EDCF) | 761 |  |
| EU Africa Infrastructure Trust Fund | 5069 | 2570 |
| Facility for Energy Inclusion financial Instrument (PAGODA) | 6481 | 11433 |
| Facility For Energy Inclusion Technical Assistance (PAGODA) | 604 | 568 |
| Fertilizer Financing Mechanism | 22442 | 16548 |
| Finland | 2252 | 2291 |
| France | 301 | 497 |

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| | | |
|:---|:---|:---|
| **Trust Fund name** | **2024** | **2023** |
| Fund For African Private Sector Assistance (FAPA) | 51273 | 47842 |
| Gender Equality Trust Fund | 25975 | 23732 |
| Global Agriculture and Food Security Programme (GAFSP) | 24432 | 5 |
| Global Environment Facility | 42913 | 35385 |
| Global Infrastructure Facility Fund | 1272 | 1195 |
| Green Climate Fund | 21848 | 20014 |
| India | 2137 | 1227 |
| Infrastructure Consortium for Africa (ICA) | 667 | 407 |
| Initiative Migration and Development (IMDE) | 63 | 63 |
| Investment Climate Facility for Africa | 397 | 387 |
| Italia | 2633 | 3268 |
| Job for youth and women in Agricultural Value chain in Kenya (PAGODA) | 1425 | 15964 |
| Korea Trust Fund | 41539 | 32625 |
| Making Finance Work for Africa (MFW4A) | 225 | 267 |
| Microfinance Trust Fund | 2389 | 2410 |
| Multilateral Cooperation Center for Development Finance (MCDF) | 9671 | 4369 |
| Nepad Infrastructure | 40275 | 34399 |
| Nigeria Technical Cooperation Fund (NTCF) | 3924 | 3633 |
| Norway | 38 | 42 |
| Private Sector Credit Enhancement Facility | 242639 | 225663 |
| Rockefeller Foundation | 452 | 731 |
| Rural Water Supply and Sanitation Initiative | 15111 | 17646 |
| SFRD (Great Lakes) | 490 | 465 |
| South-South cooperation Trust Fund | 271 | 409 |
| Statistical Capacity Building (SCB) | 116 | 113 |
| Strategic Climate Fund | 62252 | 71568 |
| Sustainable Energy Fund for Africa | 301462 | 239955 |
| Switzerland Technical Assistance Grant |  | 375 |
| Trust Fund for Countries in Transition |  | 1027 |
| Uganda Road Sector Project | 1472 | 1400 |
| United Kingdom |  | 73 |
| Urban Municipal Development Fund | 24440 | 18619 |
| Value for Money Sustainability and Accountability Trust Fund | 848 | 800 |
| Women Entrepreneurs Finance Initiative Trust Fund | 9755 | 10684 |
| Youth Entrepreneurship Innovation Trust Fund | 18409 | 19088 |
| Zimbabwe Multi-Donor Trust Fund | 1102 | 1425 |
| Others | 67 | 77 |
| **Total** | **1584286** | **1497272** |

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**MEMBERSHIP OF FRANCE**

France became a member on 30 December 1983. As at 31 December 2024, a total number of 538,171 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to France. Of this amount of UA 5,381,710,000, the callable capital portion represented UA 5,111,090,000 and the paid-in capital was UA 270,620,000.

As at 31 December 2024, France was entitled to cast 538,796 votes (3.691 percent) of the total votes of all members. As at that date, France was represented on the Bank's Board of Governors (the "Board of Governors") by Mr. Bertrand Dumont as Governor.

**MEMBERSHIP OF GERMANY**

Germany became a member of the Bank on 18 February 1983. As at 31 December 2024, a total number of 952,360 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to Germany. Of this amount of UA 9,523,600,000, the callable capital portion represented UA 9,198,270,000 and the paid-in capital was UA 325,330,000.

Germany subscribed to the shares allocated to it as part of the General Callable Capital Increase (GCCI), which was approved by the Board of Governors in May 2024. This increased its callable capital to 919,827 shares.

As at 31 December 2024, Germany was entitled to cast 600,590 votes (4.115 percent) of the total votes of all members. As at that date, Germany was represented on the Board of Governors by Dr. Bärbel Kofler as Governor.

**MEMBERSHIP OF JAPAN**

Japan became a member of the Bank on 3 December 1982. As at 31 December 2024, a total number of 792,484 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to Japan. Of this amount of UA 7,924,840,000, the callable capital portion represented UA 7,494,710,000 and the paid-in capital was UA 430,130,000.

As at 31 December 2024, Japan was entitled to cast 793,109 votes (5.434 percent) of the total votes of all members. As at that date, Japan was represented on the Board of Governors by Mr. Katsunobu Kato as Governor.

**MEMBERSHIP OF SWITZERLAND**

Switzerland became a member of the Bank on 30 December 1982. As at 31 December 2024, a total number of 210,657 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to Switzerland. Of this amount of UA 2,106,570,000, the callable capital portion represented UA 1,995,780,000 and the paid-in capital was UA 110,790,000.

As at 31 December 2024, Switzerland was entitled to cast 211,282 votes (1.448 percent) of the total votes of all members. As at that date, Switzerland was represented on the Board of Governors by Mr. Dominique Paravicini as Governor.

**MEMBERSHIP OF THE UNITED KINGDOM**

The United Kingdom became a member of the Bank on 29 April 1983. As at 31 December 2024, a total number of 271,589 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to the United Kingdom. Of this amount of UA 2,715,890,000, the callable capital portion represented UA 2,538,270,000 and the paid-in capital was UA 177,620,000.

As at 31 December 2024, the United Kingdom was entitled to cast 272,214 votes (1.865 percent) of the total votes of all members. As at that date, the United Kingdom was represented on the Board of Governors by Rt Hon Anneliese Dodds MP as Governor.

**MEMBERSHIP OF THE UNITED STATES OF AMERICA**

The United States of America became a member of the Bank on 8 February 1983. As at 31 December 2024, a total number of 949,506 shares (par value UA 10,000 per share) of the capital stock of the Bank has been issued to the United States. Of this amount of UA 9,495,060,000, the callable capital portion represented UA 9,017,240,000 and the paid-in capital was UA 477,820,000.

The General Counsel of the Treasury Department of the United States has rendered an opinion to the effect that the portion of the United States subscription to the callable capital that has been provided for in budgetary and appropriations legislation is an obligation backed by the full faith and credit of the United States, although appropriations by the United States Congress would be required to enable the Secretary of the Treasury to pay any part of the subscription to callable capital if it were called by the Bank.

As at 31 December 2024, the United States was entitled to cast 950,131 votes (6.509 percent) of the total votes of the members. As at that date, the United States of America was represented on the Board of Governors by Ms. Janet Yellen as Governor.