COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 19.06.1997 
COM(97) 312 final 
THE COMMISSION'S ANNUAL REPORT 
TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT 
ON THE BORROWING AND LENDING ACTIVITIES 
OF THE COMMUNITY IN 1996 
and 
THE COMMISSION'S REPORT 
TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT 
ON THE RATE OF UTILIZATION 
OF THE NEW COMMUNITY INSTRUMENT (NCI) 
(half-year from 1 July to 31 December 1996) 

CONTENTS 
INTRODUCTION 
A. THE COMMISSION'S ANNUAL REPORT TO THE COUNCIL AND TO THE 
EUROPEAN PARLIAMENT ON THE BORROWING AND LENDING 
ACTIVITIES OF THE COMMUNITY IN 1996 
1. Community borrowing 
2. Lending within the Community 
3. Lending outside the Community 
4. The European Investment Fund 
5. Budgetary impact of lending 
Statistical Annex 
B. THE COMMISSION'S REPORT TO THE COUNCIL AND TO THE 
EUROPEAN PARLIAMENT ON THE RATE OF UTILIZATION OF THE NEW 
COMMUNITY INSTRUMENT (NCI) (half-year from 1 July to 
31 December 1996) 
1. Overall situation on 31 December 1996 
2. Breakdown of loans by country and sector 
Statistical Annex 
INTRODUCTION 
A. Annual report 
This annual report is drawn up in accordance with the Council Decisions 
establishing the New Community Instrument (NCI)1 and lending instruments for 
Euratom research and finance.2 In addition, Parliament, in its Resolution on 
improving political monitoring of the Community's borrowing and lending activities,3 
called for the activities of the ECSC and the EIB to be included. The present annual 
report covers 1996; it is the seventeenth report published by the Commission and is 
intended to comply with the obligation imposed on it by the Council and Parliament 
to provide the fullest information possible on all these activities. 
In financial terms, 1996 was marked by a very substantial upturn in activity, which 
was triggered by a modest recovery in real growth (real GDP up 1,6%) and a very 
clear improvement in the fundamentals (low inflation, sound public finances, falling 
interest rates, buoyant world trade). The improvement in the economic environment 
stimulated financial investment and issues of long-term securities, particularly during 
the second half-year. Conversely, the lending instrument registered a downturn for 
the whole of the OECD area (Table 1). 
For reasons specific to them, the Community lending instruments followed similar 
trends in 1996. However, EEB lending recorded a significant increase within the 
Union (up 12,6%), with activity focusing on support for assisted regions, financing 
for trans-European networks and projects in the new Member States. In contrast, 
following the exceptional results of 1995, activity outside the Union slowed as the 
result of an unfavourable political climate in certain countries and the expiry of the 
mandate conferred on the Bank by the Community in Latin America and Asia, 
renewal negotiations having taken longer than anticipated. 
Since the EEB's mandate for the above area expired sooner than for the other regions, 
the Commission proposed an interim programme to the Council in January 1996 
which the Council approved in December 1996 for an amount of ECU 275 million. 
Taking the view that it was more equitable to renew these mandates simultaneously 
and to make their expiry dates tally with the period covered by the financial prospects 
1 Article 6 of Decision 78/870/EEC (OJ No L 298 of 25 October 1978); 
Article 7 of Decision 81/19/EEC (OJ No L 37 of 10 February 1981); 
Article 7 of Decision 81/1013/EEC (OJ No L 367 of 23 December 1981); 
Article 6 of Decision 82/169/EEC (OJ No L 78 of 24 March 1982); 
Article 7 of Decision 83/200/EEC (OJ No L 112 of 28 April 1983); 
Article 9 of Decision 87/182/EEC (OJ No L 71 of 14 March 1987). 
2 Article 4 of Decision 77/270/Euratom (OJ No L 88 of 6 April 1977). 
3 Doc. PE/67134 of 5 March 1981 (OJ No C 287 of 9 November 1981). 
3 
Taking the view that it was more equitable to renew these mandates simultaneously 
and to make their expiry dates tally with the period covered by the financial 
prospects establishing the budgetary reserve, the Commission proposed to the 
Council that the EEB's mandate in all third countries for 1997-2000 be renewed, on 
a comprehensive basis, for three years. On that basis, the Council decided at the 
beginning of 1997 to guarantee from the Community budget for 70% of loans 
signed, on principal and interest, within the limit of ECU 7 105 million. The 
mandate breaks down as follows (Table 8 in the Annex): 
- CEEC ECU 3 520 million 
- Mediterranean basin ECU 2 310 million 
- Third countries of Latin America and Asia ECU 900 million 
- South Africa ECU 375 million 
B. Half-yearly report 
With a view to ensuring that borrowings designed to promote investment within the 
Community are continuously monitored, the 1983 and 1987 Decisions concerning 
the NCI also provide for the Commission to present Parliament and the Council 
with a six-monthly report about the rate of utilization of the NCI borrowing 
tranches. Part B of this document therefore provides an account of NCI activities 
over the period from 1 July to 31 December 1996. 
A. THE COMMISSION'S ANNUAL REPORT 
TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT ON THE 
BORROWING AND LENDING ACTIVITIES OF THE COMMUNITY IN 1996 
I 1. COMMUNITY BORROWING 
H 
j 
1 1.1. In order to attain the objectives of the Treaty covering the territory of the 
I Community, the Commission has been empowered to borrow funds on the capital 
i market. These borrowings must finance the construction cf, and improvements to, 
nuclear power stations (current Euratom ceiling of ECU 4 billion), investment in 
the Community under the NCI (current ceiling of ECU 6.8 billion) and, under the 
ECSC Treaty, promote productive capacity or conversion projects in the coal and 
steel industries and, where appropriate, loans for Member States with 
balance-of-payments difficulties (ceiling of ECU 14 billion). The amounts still 
available are indicated in the paragraphs corresponding to each instrument. 
On the basis of agreements concluded with non-Community countries, the 
Commission is empowered to borrow to finance programmes of financial 
assistance for the countries of Central and Eastern Europe, for the African, 
Caribbean and Pacific (ACP) countries and for measures adopted pursuant to the 
Mediterranean protocols. 
Within and outside the Union, the European Investment Bank (EIB) has been 
closely involved in the financing of common policies and priorities, to the point 
where its borrowings account for most Community issues (Table 1). 
1.2. The volume of borrowing in the market by the Community institutions in 1996 
totalled ECU 18 billion, an increase of 36,4% on the previous year (Table Ï). 
Although smaller than the increase recorded by bonds issued by OECD-area 
countries on international markets, the Community figure is not far short of it. It 
basically resulted from issues made by the EIB to finance activities falling within 
its remit. The issues made by the Commission (allocated borrowings) continued to 
follow the guidelines laid down by the Council for disengaging the Commission 
from certain activities in favour of the EIB. 
Overall, the share of Community issues remained virtually stable in relation to that 
of bonds issued in the OECD area. Eurobonds recorded substantial gains, 
increasing by more than 64% on a year-on-year basis. 
The more optimistic climate on financial markets, falling interest rates and the 
prospect of a modest recovery in economic activity tended to discourage 
variable-rate issues, whose relative share declined again. 
Table 1 
Capital borrowed on the international markets (ECU billion) 
1989 1990 1991 1992 1993 1994 1995 1996 
1. European Institutions 
of which: 
1.1 ECSC 
1.2 EC (a) 
1.3 Euratom 
1.4 EIB 10,5 
0,9 
0,5 
9,0 12,5 
1,1 
0,4 
11,0 16,9 
1.4 
1,7 
13,7 15,7 
1,5 
1,2 
13,0 20,1 
0,9 
5,0 
14,2 15,2 
0,6 
0,3 
0,1 
.14,2 13,2 
0,4 
0,4 
12,4 18,0 
0,3 
0,1 
17,6 
2. OECD countries (b) 
(by instrument) 
2.1 Bond issues 
of which: Eurobonds 
2.2 Loans 232,2 180,5 240,2 257,1 
193,2 141,4 200,5 212,7 
117,5 103,3 99,9 96,0 410,8 360,3 357,3 
337,0 309,7 283,9 
123,7 202,7 285,9 559,6 
465,9 
274,0 
3. Bond issues by the 
European Institutions 
as a % of OECD 3.9 6,1 5,7 5,1 3,5 3,9 3,5 3,2 
(a) NCI + balance of payments, 
(b) Calculations based on yearly average exchange rate of the ecu, 
Source: OECD & EU 
2. LENDING WITHIN THE COMMUNITY 
2.1. In most Community countries the fundamentals improved and economic activity 
slowed in 1996 (real GDP up by 1,6%, against 2,5% in 1995). Although exports 
continued to perform well (up 3,3% in real terms), investment in general, and 
particularly in the building industry and public works, was affected by the close 
monitoring of public deficits. 
Good inflation figures in virtually all countries and a sharp fall in interest rates had not 
given rise to a sufficient labour market recovery for unemployment to be reduced by 
the end of 1996. However, investment by SMEs started to pick up. 
2.2, In this context, reflecting the commitment to creating a macro-economic climate 
favourable to EMU, the EIB granted loans in the European Union to the tune of 
ECU 20,95 billion as against ECU 18,6 billion in 1995, an increase of 12,6% 
(Table 2). The funding helped to create an investment volume estimated at 
ECU 60 billion, or some 5% of the gross fixed capital formation (GFCF) achieved in 
the Union. Â significant volume of lending took place in Austria, Sweden and 
Finland, with the amount virtually double that of 1995, the first year of their 
accession. However, the most appreciable increase in loans was seen in the 
Netherlands, Italy, Greece, France and Germany. 
The financing of investment contributing to regional development and to the 
strengthening of economic cohesion remained one of the Bank's main concerns in 
1996 (Table 5 in the Annex) and accounts for more than two-thirds of total loans. 
These loans were concentrated in areas qualifying for support under the Structural 
Funds, especially in the "cohesion" countries, Germany's eastern regions and southern 
s 
Italy, where financing returned to 1994 levels Since the reform of the Funds in 
1989, loans for regional development have totalled ECU 85 billion, helping to 
finance investment estimated at ECU 249 billion. 
'VS.-Several years ago the EIB adapted its loan conditions to the specific requirements of 
establishing coherent networks, essential for intra-Community trade. The Bank thus 
became directly involved in financing trans-European networks and more 
especially in the priority projects identified by the Essen European Council. Under 
this heading, it had approved loan commitments of ECU 10,7 billion by the end of 
1996. The Bank has made approximately ECU 30 billion available within the Union 
since 1993 for the establishment of trans-European networks in transport, energy 
transfers and telecommunications. The facilities offered by the special TEN s 
window have been applied whenever possible. 
Table 2 
Structure of EIB tending (loan contracts signed) - Geographical distribution 
1S93 
ECU million 1SS4 
ECU million %Ti 199S 
ECU million % 1986 
ECU million 
Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Austria 
Portugal 
Finland 
Sweden 
United Kingdom 
Other (Article 18) 372 
876 
2 097 
511 
4 005 
2 206 
388 
3 362 
380 
1 489 
1 929 
111 1.9 
4,5 
10,7 
2.6 
20,4 
11.2 
2,0 
17.1 
0.0 
1.9 
0,0 
7.6 
0,0 
0,0 
9,8 
0.6 615 
650 
2 408 
535 
3 012 
2 477 
291 
3 100 
5 
400 
90 
1 110 
60 
15 
2 455 
261 3.1 
4,3 
12,1 
2,7 
15,1 
12,4 
1,5 
15,6 
0,0 
2.0 
0.4 
5,6 
0.3 
0,1 
12,3 
' 1.3 665 
825 
2 715 
525 
2 818 
2 207 
327 
3 435 
79 
319 
242 
1 232 
179 
273' 
2 244 
519 3.1 
3,9 
12.7 
2.5 
13,2 
10,3 
1.5 
16,0 
0.4 
1.5 
1,1 
5,8 
0.8 
1.3 
10,5 
2,4 657 
688 
3 022 
721 
2 553 
2 509 
189 
4 121 
766 
490 
1 294 
302 
846 
2 386 
402 2,8 
3,0 
13,0 
3.1 
11,0 
10,8 
0.8 
17,7 
0,0 
3,3 
2,1 
5.6 
1.3 
3,6 
10,3 
1.7 
Community total 17 724 90,4 17 682 88,7 18 604 86,9 20 94S 90,1 
ACP-OCT ; RSA 
Mediterranean 
CEEC 
Latin America, Asia 22G 
661 
882 
99 1.2 
3,5 
4.5 
•0,5 462 
607 
957 
220 2,3 
3.0 
4.8 
1.1 475 
1 038 
1005 
288 2,2 
4,8 
4,7 
1.3 452 
681 
1 116 
45 1,9 
2,9 
4,8 
0,2 
Non-Community total 1 887 9,6 246 11.3 2 606 13,1 2 294 9.9 
TOTAL LOANS SIGNED 19611 100,0 19 928 100,0 21 410 100,0 23 240 100,0 
Financing for infrastructure in the communications sector amounted to 
ECU 6 506 million, holding steady in relation to the previous year. Financing for 
the transport sector totalled ECU 4 500 million, most of which was directed toward 
road and railway infrastructure (ECU 4 200 million). Financing was made available 
for the new Athens international airport. Lending rose sharply in the telecommuni­
cations field, returning to the level of previous years following last year's fall. 
The Bank, which assesses the environmental impact of all the projects it finances 
and is careful to ensure that they comply with the relevant Community standards, 
granted loans worth ECU 5 875 million for that objective in 1996, thus maintaining 
2.3. funding at the average level of previous years (30% of all financing). 
ECU 4 209 million was earmarked for programmes concerning air and water quality 
and waste processing. Urban renewal schemes accounted for ECU 1 666 million. 
Financing for energy objectives increased substantially in 1996 to 
ECU 4 031 million. Financing was stepped up for a wide range of projects involving 
the use of natural gas (power stations, transport, distribution and storage). 
1996 was also marked by a clear pick-up in individual loans for industrial projects. 
Advances on global loans for SMEs held steady at a high level after the sharp increase 
recorded the previous year. Overall, lending for industrial objectives amounted to 
ECU 3 776 million, of which ECU 1 182 million consisted of individual loans and 
ECU 2 594 million advances on global loans for more than 11 000 SMEs. 
By the end of 1995 the ECU 1 billion allocated to the facility for employment-creating 
SMEs had been advanced in full, enabling the creation of some 45 000 new jobs. By 
the end of 1996 2 451 SMEs confirmed that about 28 000 jobs had been created and 
sustained for six months. 
As part of arrangements for ECSC borrowing/lending activities decided on by the 
Commission in June 1994 (OJ No 175 of 28 June 1994) with a view to the expiry of 
the ECSC Treaty on 23 July 2002, amounts paid out under new loans within the 
Community declined sharply in relation to the previous year (Table 3). 
Table 3 
ECSC loans in 1996 (ECU thousand) 
Article 54 Article 56 Article 95 Housing Total 
Belgium 
Dan mark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Austria 
Portugal 
United Kingdom 
Non-EU 12 183 
30 466 
34 911 5 951 
23 009 
16 721 
11 548 
58 924 
578 
50 398 
15 563 1074 
113 
9 663 
154 
3 589 
1800 
20 
1 937 
309 
183 
208 
357 7 025 
113 
32 672 
154 
32 493 
13 348 
20 
91327 
35 220 
183 
578 
208 
50 755 
15 563 
Total 77 560 167 129 15 563 19 407 279 659 
2.4. As regards NCI activities, repayments have continued and loans have been repaid 
virtually in full in some countries. No new lending operations have been undertaken 
since 1991 (Table 4). 
Table 4 
NCI loans at 31 December 1996 
Financial agreements 
Global loans (*) 
Productive sector (*) 
Infrastructure 
Energy 
Total contracts signed, net (**) 
EIB loans (own resources) 
Authorized ceilings 
Balance (ECU million) 
NCI 
5.4 
538.5 
446,7 
990,5 
1 000,0 
9,5 Reconstr. 
ITALIE 
598,7 
598.7 
351,6 
1 000,0 
49.7 Reconstr. 
GRECE 
80,0 
80,0 
80,0 
0.0 NCI II 
406,8 
10,6 
279.4 
300,8 
997.5 
1 000,0 
2,5 NCI III 
2 138.0 
465,3 
258,3 
2 861.5 
3 000,0 
138,4 NCI IV 
668.8 
668,8 
750,0 
81,2 TOTAL 
3 213.5 
15,9 
1 961,9 
1 005.8 
6 197.1 
351.6 
6 830.0 
267.5 
(*) Industry and agriculture 
(**) Contracts signed less cancellations 
2.5. No financing applications for nuclear projects within the Community under the 
ECU 1,1 billion Euratom ceiling have been made in recent years. However, a 
number of projects outside the Community are currently being examined (see 3.5). 
2.6. The facility providing medium-term financial assistance for Member States' 
balances of payments was not activated last year. Taking account of amounts 
disbursed in the past to Greece (ECU 1 billion - first tranche of the 1991 loan of 
ECU 2,2 billion) and to Italy (ECU 4 billion - first two tranches of the 1993 loan of 
ECU 8 billion) and repayments effected in 1996, the total amount of loans 
outstanding under this facility amounted to ECU 4 billion at 31 December 1996. The 
available margin to be financed by Community loans on the capital market therefore 
amounted to ECU 10 billion. 
3. LENDING OUTSIDE THE COMMUNITY 
Lending activities with countries having concluded cooperation agreements with the 
Community tailed off following a period of continuous expansion in recent years. 
3.1. Macroeconomic assistance in the form of balance-of-payments and 
structural-adjustment support loans for third countries amounted to 
ECU 155 million in 1996 (Table 5). Disbursements made for this purpose and 
corresponding to loans previously approved amounted to ECU 140 million, of which 
ECU 40 million was allocated to CEEC (Bulgaria) and ECU 100 million to the CIS 
(Ukraine). In addition to this, new loans approved in 1996 included the disbursement 
of ECU 15 million to Moldova. 
3.2. No new disbursements were made in 1996 under the Council Decision of 
December 1991 relating to the commercial credit facility of ECU 1 250 million in 
favour of the new independent states of the former USSR (CIS). 
Since no new operations were decided on in 1996, the total amount of credits granted 
under the facility remained at the same level as in 1995, i.e. ECU 1 133 million 
(Table 8 in the Annex). 
3.3. EIB financing outside the Union amounted to ECU 2 294 million in 1996, about 
18% down on the previous year (Table 2). ECU 2 190 million of this amount was 
financed from the Bank's own resources, with the remaining ECU 104 million funded 
from operations using risk capital drawn from Community or Member States' 
budgetary funds (Table 5). 
Lending activities were partly influenced by the process of renewing the mandates for 
Latin America and Asia (ALA), which took longer than anticipated, and by the 
unfavourable political climate in some regions. 
The loan total increased in the CEEC and in South Africa but fell in the African, 
Caribbean and Pacific (ACP) countries and the Overseas Countries and Territories 
(OCT), in the Mediterranean and in Latin America and Asia (ALA). 
3.3.1.In the ACP countries and the OCT, the EIB provided assistance amounting to 
ECU 396 million (against ECU 430 million in 1995), of which ECU 99 million was in 
the form of risk capital from the resources of the European Development Fund 
(EDF). 
Two-thirds of financing (ECU 256 million) went to basic infrastructure necessary for 
the economic development of the countries concerned. Industry received finance 
totalling ECU 42 million in the form of individual loans and ECU 98 million in the 
form of global loans concluded with local financial institutions for the financing of 
small businesses. 
3.3.2. Lending in the countries on the Mediterranean seaboard totalled ECU 681 million 
in 1996, of which ECU 5 million was drawn from awn resources. ECU 562 million 
of the loans was financed under non-protocol horizontal financial cooperation for 
communications and environmental protection projects. Loans under the current 
bilateral protocols totalled ECU 119 million. 
The breakdown per sector shows the importance of projects designed to control 
domestic pollution (waste-water collection and treatment facilities) and industrial 
pollution (decontamination project for a petrochemicals plant in Algeria and provision 
of desulphurization equipment in a power station in Turkey). In total 
ECU 380 million, or 56% of financing for the year, went directly to environmental 
protection. 
Loans totalling ECU 53 million were granted to Gaza for improvements to water 
distribution networks and the construction of a port. 
3.3.3. In the CEEC, lending to ten countries totalled ECU 1 116 million in 1996 
(ECU 1 005 million in 1995). Virtually all of these loans (97%) were provided under 
the Decision of the Board of Governors of May 1994 for a programme of 
ECU 3 billion with a Community budget guarantee. In addition, ECU 30 million was 
advanced to Slovenia under the protocol which entered into force in 1993. The bulk 
of these loans, with the exception of ECU 50 million in global loans, supported the 
10 
development of basic infrastructure, essentially communications, 
contributed to projects forming part of priority transport corridors. Several of them 
3.3.4. Under the authorization given by the Board of Governors in February 1993 to finance 
investment in Latin America and Asia, a transaction was signed in Argentina 
(ECU 45 million) to improve road infrastructure. 
3.3.5. The Bank continued to provide financing to South Africa in 1996 with a loan of 
ECU 56 million for the extension of the electricity distribution network. 
Table 5 
Financing outside the Community in 1996 j 
ACP-OCT 
Mediterranean basin 
CEEC 
CIS 
Latin America, Asia 
South Africa 
Total ECSC 
16 
16 Balance-of-
payments 
support (1) 
40 
115 (ECU million) 
EIB 
EC and EDF 
budget 
resources (2) 
99 
5 
155 I 104 Own 
resources 
(3) 
297 
676 
1 116 
45 
56 
2 190 Total 
396 
681 
1 172 
115 
45 
56 
2 465 
(1) Disbursements. 
(2) Granted and maintained by the EIB out of the budgetary resources of the EC or the 
European Development Fund (EDF) 
(3) Signed loans. | 
3.4. Outside the Community, a single ECSC loan of ECU 15,5 million was granted in 
1996. The beneficiary was a steel company undergoing restructuring. 
3.5. The Council's decision of 21 March 1994 made Euratom loans available to CEEC 
and CIS countries with a view to improving the safety and efficiency of their nuclear 
power stations. The available amount is about ECU 1,1 billion, taking the current 
global ceiling fixed by the Council into account. 
Several projects are being appraised in Ukraine, Bulgaria, Russia and Lithuania, but 
given the political and technical complexity of projects of this type, no decision to 
provide funds was taken in 1996. 
3.6. The Community and EEB are both shareholders and close partners of the EBRD: they 
each hold 3% of the Bank's capital, work in close cooperation and match their 
resources. 
According to the EBRD's annual report for 1996, the Board approved 119 new 
projects in the CEEC and the former Soviet Union (against 134 in 1995), for a total 
amount of ECU 2,8 billion, or about 10% more than in 1995 on the basis of 
reevaluated figures. Signed commitments amounted to ECU 2,2 billion in 1996. 
11 
Equity holdings as a proportion of the Bank's entire activities fell from 24% in 1995 
to 19% in 1996, i.e. ECU 526 million. 
4. THE EUROPEAN INVESTMENT FUND 
In 1996, the EIF was able to complete the major preparatory work carried out since 
its creation in June 1994 and thus record a sharp rise in the number of operations 
signed. Twenty-two operations were signed during the year involving a total amount 
of ECU 833 million, which takes the overall volume of operations signed since its 
creation to ECU 1 464 million. The proportion of this amount taken up by 
infrastructure projects linked to the Trans-European Networks (TEN) programme is 
78%, with the remaining 22% of commitments going to support small and medium-
sized enterprises. 
The infrastructure projects which received Fund guarantees were in the transport and 
energy sectors. Guarantees granted to SME projects concentrated on support for the 
start-up phase of the "Growth and environment" pilot programme. This is an 
initiative of the European Parliament for which the Commission budget is financing 
the cost of loan guarantees for SMEs which carry out projects of potential benefit to 
the environment. Of the thirteen operations approved under this programme (to the 
tune of ECU 392 million), six (totalling ECU 162 million) have been negotiated and 
signed with financial intermediaries in five Member States. 
As provided for in its Statutes, the EIF was authorized in 1996 to become involved in 
equity participations. An amount of ECU 75 million was earmarked for this purpose 
up to the end of 1998. A series of operations were identified and examined in 1996, 
and the first contracts were scheduled to be signed at the start of 1997. 
At the end of 1996, the Fund's assets stood at ECU 1 786 million, or 89,3% of the 
authorized capital of ECU 2 billion. This has been subscribed by 78 shareholders 
made up of 76 financial institutions, the European Union (represented by the 
Commission) and the EIB. 
5. BUDGETARY IMPACT OF LENDING 
The Community's general budget is affected by lending activities where loans are 
accompanied by interest subsidies and/or budget guarantees. 
5.1. Interest subsidies 
Interest subsidies are granted by the Community in the following fields (see Table 7 in 
Annex): 
a) the industrial conversion of coal and steel areas (Article 56 of the ECSC Treaty), 
b) the reconstruction of the disaster-hit areas of Italy, Greece and Portugal 
(Autonomous Region of Madeira), and 
12 
c) in the context of the "SME facility". 
No industrial loans at reduced rates for investment projects designed to promote 
consumption of Community coal (Article 54, second paragraph) have been made. 
With regard to subsidies for conversion loans in coal and steel areas (Article 56), 
interest subsidies amounted to ECU 36,8 million in 1996 against ECU 11,5 million in 
1995 and ECU 51,1 million in 1994. 
The Council Decision on reconstruction following the earthquake on Madeira in 1993 
lays down that interest subsidies on EIB loans are to be paid directly by the 
Commission to the Autonomous Region of Madeira and no longer via the EIB, as had 
been the case for the earthquakes in Greece and Italy. 
The Copenhagen European Council of June 1993 increased by ECU 3 billion the 
temporary facility agreed in Edinburgh for major infrastructure projects. Of that 
amount, ECU 1 billion is earmarked for measures to strengthen the competitiveness 
of European small and medium-sized enterprises and is combined with interest 
subsidies linked to job creation. The subsidy amounts to ECU 3 000 per additional 
job created (equivalent on average to a 2% interest-rate reduction). The Council 
Decision of 19 April 1994 allowed the EIB to start signing global lending agreements 
with financial intermediaries in all Member States in the second half of 1994. The 
allocation of loans ended on 15 December 1995, the entire budget of ECU 1 billion 
having been used up. 
By the end of 1996, 48% of this facility had been spent: a total of ECU 480 million 
had been allocated to 2 536 firms. It is thought that the entire budget could be 
disbursed in 1997, with some 4 500 firms benefiting. Budgetary payments for this 
facility amounted to ECU 2,8 million in 1995 and ECU 17,5 million in 1996. 
Interest subsidies are also provided in connection with EIB loans outside the 
Community (see Table 8 in Annex). 
5.2. Budget guarantees 
5.2.1. Coverage 
All the outstanding borrowing contracted by the Community to finance loans 
managed by the Commission (Euratom, NCI, balance of payments) is guaranteed by 
the general budget. 
In this connection, the Community budget was involved in an ECU 15 million 
"balance-of-payments loan" to Moldova in 1996. 
The Bank's loans from own resources granted to non-Community countries in pursuit 
of the Community's policy of providing financial assistance for development are 
covered by a guarantee agreement. The guarantees are provided by Member States 
for loans in ACP countries and the OCT and by the Community for Mediterranean, 
Central and east European (CEEC) countries, the countries in Latin America and Asia 
with which the European Union has concluded cooperation agreements and South 
Africa. 
Details of the Community budget guarantees provided in this connection are as 
follows: 
13 
a) EIB loans to Mediterranean countries: These loans are covered by a global 
Community guarantee for 75% of the amount of loans signed. 
At the end of 1996, outstanding loans totalled ECU 2 357 million, of which 
ECU 265 million was accounted for by loans in Spain, Greece and Portugal 
(pre-accession) and ECU 2 092 million by loans in non-member Mediterranean 
countries. 
b) EIB loans to the CEEC: Loans contracted are fully covered by the Community 
guarantee. At 31 December 1996, the EIB had advanced ECU 1 628 million to 
these countries out of a total allocation of ECU 1,7 billion under the CEEC I 
Agreement. The total amount outstanding for loans at the end of 1996 was ECU 
971 million. 
At the end of 1993, the Community renewed its guarantee to cover EIB lending to 
the CEEC, including the Baltic States and Albania, up to a ceiling of ECU 3 billion 
over the subsequent three years (CEEC II Agreement). At 31 December 1996 the 
EIB had advanced ECU 2 980 million from this allocation. At the same date, the 
amount of the guarantee outstanding was only ECU 335 million. 
c) EIB loans to third countries in Latin America and Asia: Loans granted to 
those countries with which the Community has concluded cooperation agreements 
are fully guaranteed by the Community budget. This programme was adopted in 
February 1993 and relates to a global amount of ECU 750 million over a period of 
three years, with a ceiling of ECU 250 million a year. At the end of 1996, loans 
signed stood at ECU 647 million, while disbursements, the amount of which is 
covered by the budget guarantee, stood at ECU 204 million. On 
12 December 1996, the Council authorized an interim guarantee for one year 
restricted to an overall loan ceiling of ECU 275 million, expiring in June 1997. 
This decision enabled the link to be made between the initial mandate conferred on 
the Bank in this region and the global multi-annual mandate for all third countries 
approved by the Council at the start of 1997. 
d) EIB loans to South Africa: In June 1995, the Community provided its guarantee 
for loans to be granted by the EIB in South Africa over the subsequent two years, 
up to a maximum amount of ECU 300 million. These loans are fully guaranteed 
by the Community budget. At 31 December 1996, the EIB had advanced 
ECU 101 million while, on the same date, the outstanding guarantee relating to 
principal and interest was only ECU 32 million (Table 6). 
14 
5.2.2 Outstanding guarantees at 31 December 1996 
At the end of 1996, outstanding guarantees provided by the Community budget, 
which, as indicated, relate to the amount of loans disbursed, details of which are given 
in Table 6, stood at some ECU 12 billion, more than 53% of which was for countries 
outside the Community. Compared with 1995, total outstanding guarantees were 
down by ECU 1 238 million. However, the proportion of commitments to 
non-Community countries has increased steadily from 37,5% in 1992 to 53% at 
present. 
The annual risk covered by the general budget, which concerns the repayment of the 
debt (principal and interest), stood at ECU 3 149 million in 1996, of which 
ECU 1 081 million related to third countries. 
At 31 December 1996, amounts paid out by the Community and not yet repaid by 
defaulting debtors stood at ECU 330,7 million, of which ECU 84,4 million is owed by 
some of the republics of the former Yugoslavia and ECU' 246,3 million by Tajikistan, 
Armenia and Georgia. 
All provisional drawings on the Commission's cash resources in respect of the 
guarantee have been settled from the budget up to 1994 and, since its establishment 
by Council Regulation No 2728/94 of 31 October 1994, by the Guarantee Fund. 
15 
Table 6 
Capital outstanding on guaranteed operations (at 31 Dec 1996) 
(ECU million) 
Operation Amount 
ceiling Amount 
outstanding at 
31.12.95(1) Amount 
outstanding at 
31.12.96(2) 
Member States 
A.Balance of payments 
1. Greece 
2. Italy 
B. Other 
3. Euratom (3) 
4. NCI 
5. EIB Mediterranean (E, GR, P) 26 330 
14 000 
4 000 
6 830 
1500 7 263 
1000 
4 045 
720 
1 113 
385 5 564 
500 
3 479 
572 
748 
265 
Non-Community countries 
A. Financial assistance 
1. Hungary 
2. Former USSR 
3. Czech Republic 
4. Sol va k Republic 
5. Bulgaria 
6. Romania 
7. Estonia 
8. Latvia 
9. Lithuania 
10. Israel 
11. Algeria 
12. Moldova 
13. Ukraine 
14. Belarus 
B. Other 
15. Mediterranean 
16. CEEC I and II 
17. Latin America, Asia 
18. South Africa 17 422 
5 035 
1050 
1250 
250 
125 
400 
580 
40 
80 
100 
160 
600 
60 
285 
55 
12 387 
6 362 
4 700 
1025 
300 5 851 
2 987 
440 
347 
250 
125 
360 
510 
20 
40 
75 
160 
500 
45 
85 
30 
2 864 
1782 
933 
149 6 312 
2 679 
180 
144 
250 
125 
400 
510 
20 
40 
75 
160 
500 
60 
185 
30 
3 634 
2 092 
1 306 
204 
32 
TOTAL GENERAL 43 752 13 114 11 876 
(1) Exchange rate as at 31.12.1995. 
(2) Exchange rate as at 31.12.1996. 
(3) Extension of Euratom loans to certain third countries (Council Decision of 21 March 1994). 
16 
STATISTICAL ANNEX 
17 
Table 1 
Trend of borrowing and lending In the Community (ECU million) 
(ECU rate at year-end) 
1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 
I. Borrowing 
ECSC 
Balance of payments (1 ) 
Euratom 
NCI 
Total Commission 1265 
344 
860 
2 469 1517 
862 
488 
541 
3 408 1487 
860 
853 
611 
3811 880 
93 
945 
1918 913 
522 
1435 1086 
350 
76 
1512 1446 
1695 
49 
3190 1474 
1209 908 
4 969 
2 683 5 877 644 
245 
49 
70 
1008 386 
410 
66 
862 298 
155 
453 
EIB (2) 5 699 6 786 5 593 7 666 9 034 10 996 13 672 12 974 14 224 14 148 12 395 17 553 
Total EC 8168 10194 9404 9584 10 469 12 508 16 862 15657 20101 15156 13 257 18006 
II. Lending 
ECSC 
Balance of payments (1) 
Euratom 
NCI 
Total Commission 1010 
211 
884 
2 105 1069 
862 
443 
393 
2 767 969 
860 
314 
425 
2568 908 
357 
1265 700 
78 
778 993 
350 
24 
1367 1382 
1695 
39 
3116 1486 
1209 
9 
2 704 918 
4969 
30 
5 917 674 
245 
49 
968 403 
410 
813 280 
155 
435 
EIB (3) 5 641 6 678 6 967 8 844 11507 12 605 14 438 16 066 17 724 17 682 18 604 20 946 
Total EC 7 746 9 445 9 535 10109 12 285 13 972 17 554 18 770 23 641 18 650 19 417 21381 
Note: The differences between total borrowing and lending by the Commission are due to borrowing operations undertaken 
for refinancing purposes and to changes in the balance of loans not assigned by the end of the year. 
The differences between borrowing and lending by the EIB are due to the fact that EIB lending operatbns are financed both 
from borrowings and from the Bank's own resources. 
(1) Mechanism for providing financial support for Member States and assistance for non-member countries. 
(2) Total resources raised. 
(3) Loans signed out of own resources, no account being taken of the guarantees provided by the EIB to promoters 
or of operations financed out of NCI resources. 
18 
Table 2 
Community borrowings outstanding (at year-end) (1) (2) 
1982 
1983 
1984 
1985 
1986 
1987 
1988 
1989 
1990 
1991 
1992 
1993 
1994 
1995 
1996 (ECU million) 
ECSC BB(3) Euratom NIC Sub-total 
6178 16 570 1272 1747 25 767 
6 539 20 749 1 680 3 269 32 237 
7119 25 007 1892 4 432 38 450 
7 034 26 736 2 013 4 960 40 743 
6 761 30 271 2168 5 202 44 402 
6 689 31 957 2 500 5 229 46 375 
6 825 36 928 2164 5 514 51431 
6 738 42 330 1945 5122 56135 
6 673 48 459 1 687 4 542 61 361 
7139 58 893 1563 3 817 71412 
7 327 67 784 1 338 3 326 79 775 
7 331 78 661 1018 2 202 89 212 
6 548 83 673 779 1 570 92 570 
5 966 87 079 720 1113 94 878 
4 656 96 649 572 748 102 625 Balance-of-pay. 
borrowings 
591 
4 610 
4 932 
3236 
1 890 
2 997 
2459 
2 075 
(4)2 045 
3 516 
4026 
5204 
7 697 
8 032 
6658 Total 
borrowing 
26 358 
36 847 
43 382 
43 979 
46 292 
49 372 
53 890 
58 210 
63 406 
74 928 
83 801 
94 416 
100 267 
102 910 
109 283 
(1) The conversion rates used were those obtained on 31 December of each year. As the majority of borrowings 
are denominated in national currencies, the difference between two year-ends reflects, on the one hand, changes 
in the valuation of the existing stock and, on the other, the net volume of borrowings during the year. 
(2) Original amount of borrowings, plus or minus repayments of the principal, cancellations, annulments and 
exchange-rate adjustments. 
(3) As from 1989 including short term. 
(4) As from 1990 also includes balance-of-payments and financial assistance for non-member countries. 
19 
Table 3 
Community borrowings in 1996, by currency (ECU million) 
Balance-of- Total 
EIB Euratom ECSC NCI Payments(1) Borrowing 1995 
% 1996 
% 
ECU 
BEF 
DKK 
DEM 
GRD 
ESP 
FRF 
IEP 
ITL 
LUF 
NLG 
PTE 
FIM 
SEK 
GBP 
Sub-total 500 
19 
88 
5 285 
97 
2 035 
655 
102 
4 398 
65 
84 
358 
34 
191 
2168 
16 079 6 
64 
29 
7 
53 
35 
50 
244 155 
155 655 
25 
88 
5 349 
97 
2064 
662 
102 
4 451 
100 
84 
358 
34 
191 
2 218 
16 478 6,1 
0,1 
19,5 
1,1 
12,0 
2,7 
1,0 
25,6 
1,5 
1,1 
7,6 
0,1 
0,6 
8,3 
87,3 3,6 
0,1 
0,5 
29,7 
0,5 
11,5 
3,7 
0,6 
24,7 
0,6 
0,5 
2,0 
0,2 
1,1 
12,3 
91,5 
CHF 
JPY 
USD 
ZAR 
Sub-total 165 
580 
698 
33 
1 476 54 
54 165 
580 
752 
33 
1530 2,9 
5,8 
4,0 
12,7 0,9 
3,2 
4,2 
0,2 
8.5 
TOTAL 17 555 298 155 18008 100,0 100,0 
(1) Balance of payments and financial assistance for non-member countries. 
Table 4 
Lending in treConrnxifty in 1995 and 1996, by sector and instrument 
(ECU million) 
ECSC BB(1) Euratom Na(1) Total % of total 
1995 1996 1995 1996 1995 19961 1995 1996 1995 1996 1995 1996 
Productive sector 
of which: allocations 
from global loans 
infrastructure 
of which: allocations 
from global loans 
Energy 
of which: allocations 
from global loans 346 248 
222 178 
14 20 
12 4617 4477 
2955 2630 
10082 10388 
1299 1535 
3083 4945 
100 279 4963 4725 
3177 2808 
10096 10408 
1299 1539 
3083 4957 
too 27a 27,4 23,5 
17,5 14,0 
55,6 51,8 
7,2 7,6 
17,0 24,7 
0,6 1,4 
TOTAL 360 280 17782 198101 18142 20090} 100,0 100,0 
(1) Financing granted (individual loans and allocations from global loans) 
20 
Table 5 
Financing in the Community by the EIB In 1995 and 1996, 
by economic objective 
1. Regional development 
1.1 By country 
Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Austria 
Portugal 
Finland 
Sweden 
United Kingdom 
1.2 By major sector 
Energy 
Communications 
Environment and various 
Industry, services, agriculture 
2. Communications infrastructure 
2.1 Transport 
2.2 Telecommunications 
2.3 Other 
3. Environmental protection and improvement 
3.1 Environment 
3.2 Town planning 
4. Energy 
4.1 Indigenous resources 
4.2 Import diversification 
4.3 Efficient use of energy 
5. Industrial competitiveness 
of which: small and medium-sized enterprises (1) 1995 1996 
ECU million •/. 
12 143,5 100,0 
249,0 2,1 
304,0 2,5 
1 786,3 14,7 
335,7 2,8 
2 697,0 22,2 
1 440,1 11,9 
165,5 1,4 
2 458,8 20,2 
79,3 0,7 
24,0 0,2 
63,8 0,5 
1 252,8 10,3 
23,7 0,2 
4,7 0,0 
1 258,6 10,4 
2 009,0 16,5 
5 270,0 43,4 
1 614,0 13,3 
3 252,0 26,8 
6 592,0 100,0 
5 494,0 83,3 
1 098,0 16,7 
6 044,0 100,0 
3 972,0 65,7 
2 072,0 34,3 
3 433,0 100,0 
1 037,0 30,2 
894,0 26,0 
1 502,0 43,8 
3 450,0 
Number 
2 881,0 H736 ECU million % 
13 805,0 100.0 
236,0 1,7 
397,0 2,9 
2 297,0 16,6 
730,0 5,3 
2 352,0 17,0 
1615,0 11,7 
108,0 0,8 
2 853,0 20,7 
0,0 
17,0 0,1 
254,0 1,8 
1 288,0 9,3 
10,0 0,1 
317,0 2,3 
1 331,0 9,6 
4 076,0 29,5 
4 640,0 33,6 
1 826,0 13,2 
3 263,0 23,6 
6 506,0 100,0 
4 500,0 69,2 
2 006,0 30,8 
5 875,0 100,0 
4 209,0 71,6 
1 666,0 28,4 
4 031,0 100,0 
547,0 13,6 
2 011,0 49,9 
1 473,0 36,5 
3 776,0 
Number 
2 594,0 j i 034 
(1) Including allocations from NCI global loans. 
N.B. As some financing serves a number of purposes, the amounts shown under the different 
headings cannot be aggregated. 
21 
Table 6 
Geoqraphical breakdown of lending (1) in the Community in 1995 and 1996 
1996 (ECU million) 
ECSC EIB Euratom NCI Balance of 
payments Amount % 
Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Austria 
Portugal 
Finland 
Sweden 
United Kingdom 
Art. 18 (2) 7,0 
0,1 
32,7 
0,2 
32,5 
13,3 
91,3 
35,2 
0,2 
0,6 
0,2 
50,8 657,5 
688,0 
3 021,6 
721,1 
2 552,6 
2 509,2 
188,7 
4 120,7 
765,7 
489,9 
1 293,8 
302,1 
846,5 
2 386,2 
402,5 664,5 
688,1 
3 054,3 
721,3 
2 585,1 
2 522,5 
188,7 
4 212,0 
35,2 
765,9 
490,5 
1 294,0 
302,1 
846,5 
2 437,0 
402.5 3,1 
3,2 
14,4 
3,4 
12,2 
11,9 
0,9 
19,9 
0,2 
3,6 
2,3 
6,1 
1,4 
4,0 
11,5 
Total 264,1 20 946,1 21 210,2 100 
1995 
ECSC EIB Euratom NCI Balance of 
payments Amount % 
Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Austria 
Portugal 
Finland 
Sweden 
United Kingdom 
Art. 18 (2) 8,7 
104,8 
22,9 
14,9 
89,2 
9,4 
10,2 
100,3 665,0 
825,0 
2 715,0 
525,0 
2 818,0 
2 207,0 
327,0 
3 435,0 
79,0 
319,0 
242,0 
1 232,0 
179,0 
273,0 
2 244,0 
519.0 673,7 
825,0 
2 819,8 
525,0 
2 840,9 
2 221,9 
327,0 
3 524,2 
88,4 
319,0 
242,0 
1 242,2 
179,0 
273,0 
2 344,3 
519,0 3,6 
4,4 
14,9 
2,8 
15,0 
11,7 
1,7 
18,6 
0,5 
1,7 
1,3 
6,6 
0,9 
1,4 
12,4 
2.7 
Total 360,4 18 604,0 18 964,4 100 
(1) Loans granted 
(2) Community projects that cannot be located in a particular Member State (e.g. tele-
communication cables and satellites, North Sea Oil). 
22 
Table 7 
Interest subsidies paid out in the Community by the various 
Community mechanisms 1977-96 (ECU million) 
Year Non-discounted systems (1) 
ECSC Art 54 
(restrict) ECSC Art 56 
(convers.) Employment 
in Portugal Earthquake 
reconstr. Discounted systems (2) 
EMS ERDF SME 
facility 
1977 
1978 
1979 
1980 
1981 
1982 
1983 
1984 
1985 
1986 
1987 
1988 
1989 
1990 
1991 
1992 
1993 
1994 
1995 
1996 1.3 
9,8 
10,4 
25,7 
7,6 
10,5 
4,0 
6,2 
3,6 
5,9 
2,4 
3,0 
2,6 
1,3 
1,0 2,7 
16,5 
8,0 
33,4 
6,3 
19,3 
7,1 
34,0 
74,9 
33,1 
35,6 
38,6 
42,5 
40,6 
48,6 
106,0 
114,3 
51,1 
11,5 
36,8 4,0 
3.9 3,0 
14,4 
24,4 
28,4 
28,6 
28,6 
27,8 
26,6 
23,1 
20,1 
17,2 
0,5 (3) 200,0 
197,0 
193,2 
209,8 
200,0 12,1 
65,5 
2,8 
17,5 
(1 ) Interest subsidies spread over time and charged to the funds set aside for this purpose in the 
annual budgets. 
(2) Interest subsidies paid by the Commission after discounting to a present value, and charged 
to the budget as a single sum in the initial year. 
(3) Interest subsidies of ECU 475 500 paid directly by the Commission to the Autonomous Region 
of Madera (Council Decision 95/250/EC of 29 June 1995). 
23 
Table 8 
Financial assistance outside the Community In force or under negotiation at 31.12.1996 | 
ACP States-OCT 
ACP 
OCT 
South Africa 
Mediterranean countries(6) 
Algeria, Cyprus, Egypt, 
Israel, Jordan, Lebanon, 
Malta, Morocco, Syria, 
Tunisia, Turkey, Gaza 
and West Bank 
Turkey 
Malta 
Cyprus 
CEEC 
Czech Republic 
Solvak Republic 
Bulgaria 
Estonia 
Latvia 
Lithuania 
Hungary 
Romania 
Albania 
Slovenia 
as 
Former URSS 
Moldova 
Ukraine 
Belarus 
Latin American and 1 
Asian countries | Agreement 
Second Financial Protocol 
Fourth Lomé Convention 
Council Decision 
Council Decision 
Council Decision (7) 
Euro-Medterranean 
partnership (7) 
Special financial cooperation 
not yet in force 
Fourth Financial Protocol 
Fourth Financial Protocol 
Council Decision (7) 
Financial protocol 
Council Decision 
Council Decision (7) Operations from 
EIB resources 
End of 
period 
2000 
2000 
1997 
2000 
2000 
2000 
1998 
1998 
2000 
1997 
1997 
2000 Ceiling 
1693 
1658 
35 
300 
375 
3140 
2 310 
750 
30 
50 
3 520 
150 
275 
900 (ECU million) 
Operations from 
budget resources 
Risk capital 
operations 
(2) Non-repayable 
aid 
(3) 
1030 12102 
1000 11967 (5) 
30 135 (5) 
204 3460 
200 (8) 3 425 (9) 
2 13 
2 22 
4564 (13) 
20 (14) Balance of payment 
assistance (4) 
Granted Disbursed 
760 660 
600 (10) 500 
160 (11) 160 
2730 2315 
250 250 
125 125 
400 400 
40 20 
80 40 
100 75 
1050 790 
580 510 
105 (12) 105 
1650 1408 
1 250 (15) 1 133 
60 60 
285 185 
55 30 ECSC 
16 
(1) Loans attracting interest subsidies from the European Development Fund in the case of projects in the ACP States and the OCT and 
from the gênerai budget of the European Communities in the case of projects in certain Mediterranean countries The neccessary 
amounts for the interest subsidies are charged to non-repayable aid. 
(2) Granted and managed by the SB. 
(3) Granted and managed by the Commission. 
(4) Cumulated amounts since 1990. These operations are granted and managed by the Commission 
(5) Indudng amounts intended for interest subsidies on EIB loans. 
(6) The amounts available under the previous financial protocols may be used at the same time, whether that involves all of the sums 
earmarked or residual amounts. 
(7) Part of the multi-annual overall mandate approved on 14 April 1997. 
(8) lrcicativeanK>untcrBrgedtotheron-repa^ 
(9) Inducing amounts reserved for risk-capital operations and interest subsidies for EIB finance to environmental projects. 
(10) Algeria 
(11) Israel 
(12) Non-repayable advances. 
(13) PHARE Programme for the period 1996-99, managed by the Commission. 
(14) Only for interest subsidies for BB loans for transport projects of common interest. 
(15) Commercial credrts 
24 
B. THE COMMISSION'S REPORT TO THE COUNCIL AND TO 
THE EUROPEAN PARLIAMENT 
on the rate of utilization of the 
New Community Instrument (NCI) 
(half-year from 1 July to 31 December 1996) 
1. Overall situation on 31 December 1996 
Council Decisions 83/200/CEE (Article 6) and 87/182/CEE (Article 8) on the 
financing of the NCI require the Commission to draw up a six-monthly report on the 
rate of utilization of the tranches of NIC III and IV. 
This report covers the period from 1 July to 31 December 1996. 
The different legal bases determine the method of assessing the amount of loans 
signed in relation to the maximum authorized borrowing: 
a) for NCI III, the volume of loans is lower than that of borrowings in order to 
take account of the currencies borrowed and the associated costs and expenses; 
b) for NCI IV, the ceiling applies to the loans signed. 
At the end of 1996, the situation regarding the use of the tranches for which a six-
monthly report has to be drawn up was as follows: 
Use of NCI: situation at 31.12.1996 
NCI III 
NCI IV Ceiling 
3 000 
750 (ECU million) 
Amounts used 
2 862 
669 Balance 
138 (*) 
81 
(*) The special borrowing of ECU 100 million for European innovation 
projects has not yet been authorized by the Council. 
The borrowing operations carried out in the six months under review with a view to 
financing NCI activities or refinancing previous activities are shown in Annex 2 B. 
25 
2. Breakdown of loans by country and sector 
The table below provides an overall view of loans signed, converted into 
"borrowing equivalents", at 31 December 1996. The loans in the various currencies 
have been converted into ECUs at the exchange rate in force on the last working 
day of the quarter preceding the signing of the contract. 
Distribution of loans signed by country at 31.12.1996 
Country 
Belgium 
Denmark 
Greece 
Spain 
France 
Ireland 
Italy 
Netherlands 
Portugal 
UK 
Total NCII 
66,8 
70,0 
239.0 
479,9 
134,9 
990,5 NCII! 
100,6 
114,9 
125,0 
116,6 
473,4 
67,1 
997,5 NCI III 
303,0 
111,2 
69,2 
938,7 
68,4 
1 228,5 
3,2 
29,9 
109,3 
2 861,6 NCI IV 
23,6 
63,2 
118,2 
72,3 
285,7 
9,9 
95,8 
668,8 (ECU million) 
NCI 
Reconstr. 
80,0 
598,7 
678,7 Total 
23,6 
533,5 
306,1 
187.4 
1 206,0 
424,0 
3 066,3 
3,2 
39,8 
407,1 
6 197,1 % 
0,4 
8,6 
4,9 
3,0 
19,5 
6,8 
49,5 
0,1 
0,6 
6,6 
100,0 
SECTOR 
NCi III 
NCI IV Productive sector 
52,8 % 
100,0 % Infrastructure 
26,5 % Energy 
20,7 % 100,0% 
100,0% 
NCI IV is of interest because of its special features, such as the options of 
converting loans into risk capital, using loans to finance the purchase of intangible 
assets and deferring interest payments, etc. 
No loan transactions have been carried out since 1991. 
26 
STATISTICAL ANNEX 
27 
Annex 1 
NCI IV LOANS 
CEILING: ECU 750 MILLION (I) - (SKuattai at 31.12.19K) 
Ref. Project description Date of 
contract ECU 
million (2) DK. Breakdown by oounby (2) 
E IF it UK 
64*7 
64/87 
68/87 
68/81 
69/B7 
69/87 
7(V87 
7CV87 
70/87 
70/B7 
70/87 
71/87 
71/87 
73/87 
103/87 
105/87 
106/37 
107/87 
107/87 
108/87 
108/87 
110/87 
121/87 
148/87 
14»87 
148/87 
14SV87 
206/87 
206/87 
207/87 
207/87 
231/87 
6**S 
101/88 
101/88 
101/88 
101/88 
103/88 
$03/88 
103/88 
103/S8 
10SVÏ88 
128/88 
135/88 
135/88 
185/88 
185/88 
199/88 
237/S8 
237/88 
237/88 
237/88 
175/89 
119/S0 
119/90 
48/91 I. LOANS SIGNED 
FIH (Small Busmen) PG-WA 15.09.87 
FlH(SmaU Business) PG-VI/B 24.05.88 
BNL-PMIV/A 12.10.87 
BNL-PMIV/B 12.10.87 
IMI-PMIV/A 31.07.87 
IMl-PMIV/B 31.07.87 
MBDICCR CENTO-PM11V/A 15.09.87 
MBDICCR CENTR. - PMI IV/B 10.12.87 
MEDICCR CENTR.-PMIIV/C 03.02.88 
MBDICCR. CENTR-PMI IV/D 16.03.88 
MEDICCR. CENTR. -PMI1V/E 23.06.88 
INTERBANCA - PMI IV/A 07.10.87 
INTERBANCA-PMIIV/B 07.10.87 
BH-PGV 22.07.87 
CENTROBANCA - PMI IV/A 11.12.87 
CENTROBANCA-PMI IV/B 11.12.87 
SAN PAOLO Aprindusbia II 05.11.87 
CREDIOP-PMI1/A 18.12.87 
CRBDIOP-PMII/B 18.12.87 
BANCO DINAPOLI - PMI A 18.12.87 
BANCO DINAPOLI- PMI B 18.12.87 
B° DESANTANDER - PYMB 24.07.87 
B° DE BILBAO - PYME 23.07.87 
EF1BANCA- PMI IV/A 17.12.87 
EF1BANCA - PMI IV/B 17.12.87 
EFIBANCA - PMI IV/C 24.06.88 
BHBANCA-PMUV/D 24.06.88 
B°DEVIZCAYA-PYMEA 17.12.87 
B°DEVIZCAYA-PYMEB 30.11.88 
B° ESPANOL DE CREDITO -PYMB A 18.12.87 
B° ESPANOL DE CREDITO-PYME B 18.11.88 
CREDIT NATIONAL - PMI HI 05.02.88 
INVESTORS IN INDUSTRY - 28.12.88 
GROUPED LOAN V 
EFIBANCA-PMI V/A 05.10.88 
EFIBANCA - PMI V/B 05.10.88 
EFIBANCA-PMIV/C 16.01.89 
EHBANCA-PMI V/D 16.01.89 
MEDICCR. LOMBARDO - PMI A 10.10.88 
MEDICCR. LOMBARDO - PMI B 10.10.88 
MEDIOCR LOMBARDO - PMI C 06.02.89 
MEDICCR LOMBARDO - PMI D 06.02.89 
BARCLAYS BANKIIGL 21.12.88 
CENTROBANCA-PMI V/A 19.12.88 
CENTROBANCA - PMI V/B 19.12 88 
CRBDIOP-PMIIl/A 09.12.88 
CREDIOP-PMIIVB 09.12.88 
BANCO DI SîaLJA - PMI V/A 25.05.89 
BANCODISICILIA-PMIH/B 25.05.89 
CREDIT INDUSTRIEL ET COMML. 29.11.88 
M-IMWA 19.12.88 
IMI-PMIWB 15.12.88 
IMt-PMIWC" 05.02.89 
IMI-PMÎVI/D 06.02.89 
BARCLAYS BAN3CHI/A 30.11.89 
KREDIETBANKN.V. -GL 20.12.90 
KREDIETBANK.N.V.-GL 20.12.90 
B» ESPANOL DE CREDITO PG PY 28.05.91 31,80 
31.43 
18,68 
8,01 
37,29 
15,98 
6,19 
5,88 
4,81 
3,27 
18,98 
9,34 
4,00 
9,91 
9,34 
4,00 
1334 
4,67 
2,00 
4,60 
M>7 
20,19 
31,64 
4,67 
2,00 
4,55 
1,95 
9,37 
8,60 
12,04 
10,94 
20,00 
20,90 
4,53 
1,94 
4,57 
1.96 
6.79 
2,91 
9,14 
3,92 
45,55 
13,23 
5,67 
4,53 
1,94 
4,58 
1,96 
52,32 
9,06 
3,88 
13,72 
5,88 
29,38 
18,04 
5,54 
25,44 31,80 
31.43 
18,04 
5,54 20,19 
31,64 
9.37 
8,60 
12,04 
10,94 
20,00 
25,44 5232 18,68 
8,01 
37,29 
15.98 
6.19 
5,88 
4,81 
3,27 
18,98 
9.34 
4,00 
9,34 
4,00 
13^4 
4,67 
2,00 
4,60 
1,97 
4,67 
2,00 
4,55 
1,95 
4,53 
1,94 
4.57 
1,96 
6,79 
2.91 
9,14 
3,92 
13,23 
5,67 
4,53 
1,S>4 
438 
1,96 
9,06 
3,88 
13.72 
5,88 9.91 
20.90 
29,38 
TOTALI 668,82 23,58 «3,23 118,22 7232 285,73 9,91 95,83 
H. LOANS APPROVED, 
AWAITING SIGNATURE 0,00 
BALANCE 81,18 
CEILING 750,00 
(1) JOi: 271 of I4.03.19S7 (lam mint). 
(2)Gsn<isimi»Uirathc»ecicUinrfm<hel»**qtor,a«ycftte 
28 
NCt BORROWING, BY CURRENCY} Annex 2 
I A.-Debt outstanding at 31.12.1996 (1 ) 
Currency (million) Equivalent in 
ECU million(2) 
ECU 70.0 70,0 
BEF 
DEM 304,3 156,3 
ESP 
FRF 2 100.0 320.0 
ITL 
LUF 
NLG 277.5 127,0 
GBP 11.5 15.6 
CAD -
CHF 100.0 59,1 
JPY 
USD - -
Total " 748.0 
B.- New operations: 01.07.1996 - 31.12.1996 | 
Equivalent in MECU (3) 
Date 
of issue Duration 
(years) Coupon Currency j Fresh j Re-
(mlffÊon) capital (1) financings 
(1) Excluding ref.nancing operations, designed to reduced the cost of servicing existing 
debt initialiy contracted at higher interest rates. 
(2) Exchange rates as at 31.12.1996. 
(3) Exchange rates at signature. 
29 

ISSN 0254-1475 
COM(97) 312 final 
DOCUMENTS 
EN 09 oi 
Catalogue number : CB-CO-97-299-EN-C 
ISBN 92-78-21542-2 
Office for Official Publications of the European Communities 
L-2985 Luxembourg 
"2D