REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 2011
Date: 2012-07-18
Institutions: European Commission
Subjects: activity report, credit guarantee, financial control, fund (EU)

EUROPEAN COMMISSION 

Brussels, 18.7.2012  
COM(2012) 399 final 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 2011 

{SWD(2012) 217 final} 

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TABLE OF CONTENTS 

1. 

2. 

2.1. 

2.2. 

2.3. 

2.4. 

Introduction .................................................................................................................. 3 

Financial Position of the Fund at 31 December 2011 .................................................. 3 

Financial flows of the Fund.......................................................................................... 3 

Significant transactions: ............................................................................................... 5 

Significant transaction after the reporting date ............................................................ 6 

Presentation of the accounts......................................................................................... 6 

2.4.1.  Basis of preparation...................................................................................................... 6 

2.4.2.  Changes in accounting policy ...................................................................................... 6 

2.4.3. 

Impact of changes in accounting policy....................................................................... 6 

2.4.4.  Pre-consolidated financial statement for the Fund at 31 December 2011 ................... 7 

2.4.5.  Guarantee Fund: Pre-consolidated balance sheet......................................................... 7 

2.4.6.  Guarantee Fund: Pre-consolidated economic outturn account..................................... 9 

3. 

3.1. 

3.2. 

Payments to or from the Fund.................................................................................... 11 

Legal basis for payments to the Fund from the general budget ................................. 11 

Payments to or from the general budget in the course of the financial year.............. 11 

3.2.1.  Provisioning of the Fund............................................................................................ 11 

3.2.2. 

Interest from the investment of the Fund’s liquid assets ........................................... 11 

3.2.2.1.  Investment policy ....................................................................................................... 11 

3.2.2.2.  Performance ............................................................................................................... 12 

3.2.2.3.  Financial operations revenues .................................................................................... 12 

3.2.2.4.  Financial operations expenses.................................................................................... 13 

4. 

4.1. 

4.2. 

The Fund’s liabilities ................................................................................................. 13 

Default payments ....................................................................................................... 13 

EIB remuneration ....................................................................................................... 14 

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REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

ON THE GUARANTEE FUND AND ITS MANAGEMENT IN 2011 

1. 

INTRODUCTION 

Council  Regulation  (EC,  Euratom)  No 480/2009  of  25 May 20091  (codified  version)  the 
Regulation  established  a  Guarantee  Fund  for  external  actions  (‘the  Fund’)  in  order  to  repay 
the Union’s creditors in the event of default by beneficiaries of loans granted or guaranteed by 
the  European  Union.  In  accordance  with  Article 7  of  the  Regulation,  the  Commission 
entrusted  the  financial  management  of  the  Fund  to  the  European  Investment  Bank  (EIB) 
under  an  Agreement  signed  between  the  Community  and  the  EIB  on  23 November 1994  in 
Brussels and on 25 November 1994 in Luxembourg (‘the Agreement’).  

Under  Article 8(2)  of  the  Agreement,  by  1 March  of  each  year  the  EIB  must  send  the 
Commission an annual status report on the Fund and the management thereof (‘Statement of 
financial  performance’)  and  a  financial  statement  for  the  Fund  for  the  preceding  year 
(‘Statement of financial position of the Fund’). Further details of the report covering the year 
2011 can be found in the Commission Staff Working Document (SWD). 

In  addition,  Article 8  of  the  Regulation  requires  the  Commission  to  send  a  report  to  the 
European Parliament, the Council and the Court of Auditors on the situation of the Fund and 
the management thereof for each financial year by 31 May of the following year. 

2. 

FINANCIAL POSITION OF THE FUND AT 31 DECEMBER 2011 

The financial position of the Fund is the sum of all the financial flows since the setting up of 
the Fund in 1994.  

2.1. 

Financial flows of the Fund 

The  financial  position  of  the  Fund  is  presented  in  accordance  with  International  Financial 
Reporting Standards (IFRS) at the close of the 2011 financial year. 

The  Fund  totalled  EUR 1,756,205,156.06  (see  Section  3  of  the  Staff  Working  Document: 
Statement  of  financial  position  of  the Fund  at 31  December 2011, as provided  by  the  EIB). 
This is the sum of the flows since the Fund was established: 

1 

OJ L 145, 10.6.2009, p. 10 (‘the Regulation’). 

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Guarantee Fund 

budget payments to 
the Fund 

successive yearly net 
results 

recoveries of 
payments made by 
the Fund for defaults 

other accounts 
payable (including 
EIB management 
fees) 

fees received on late 
recovery (in 2002) 

calls on the Fund's 
resources 

successive 
repayments to the 
budget (including 
exceptional 
repayment to the 
budget due to the 
accession of new 
Member States) 

adjustment of 
portfolio valuation 
according to IFRS 
valuation 

Accounting  value  of 
the Fund 

Amount at 
31.12.2011 

Amount at 
31.12.2010 

Change 

3,384,734,500.00 

3,124,564,500.00 

260,170,000.00 

802,354,046.04 

760,201,245.08 

42,152,800.96 

576,705,008.19 

576,705,008.19 

0.00 

770,809.98 

747,058.18 

23,751.80 

5,090,662.91 

5,090,662.91 

(477,860,856.19) 

(477,860,856.19) 

0.00 

0.00 

(2,501,391,526.79) 

(2,501,391,526.79) 

0.00 

(34,197,488.08) 

(1,845,165.61) 

(32,352,322.47) 

1,756,205,156.06 

1,486,210,925.77 

269,994,230.29 

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The  accounting  value  of  the  Fund  increased  by  about  EUR  270  million  in  2011.  This  is 
explained by : 

Increasing 

• 

• 

The  contribution  from  the  budget  (provisioning  amount)  of  EUR 260.17  million  to 
adjust the Fund to the 9% target amount  

The net revenues on financial operations amounted to EUR 42.15 million 

Decreasing 

• 

• 

The portfolio valuation decreased by (EUR 32.3 million) due to price volatility in the 
context of the financial crisis.  

The  Fund  value  also  decreased  by  (EUR  0.024  million)  due  to  a  corresponding 
increase in the management fees paid to the EIB. 

2.2. 

Significant transactions: 

(1) 

In  January  2011,  the  contribution  from  the  budget  to  the  Fund  was  calculated 
following the article 3 and the article 5 of the Regulation :  

Article 3  of  the  Regulation2  sets  a  target  amount  for  the  Fund  of  9 %  of  the  total 
outstanding  capital  liabilities  arising  from  each  operation,  plus  any  unpaid  interest 
due. 

Article 5 of the Regulation states that the amount to be transferred from the budget to 
the Fund in year n + 1 is calculated on the basis of the difference between the target 
amount and the value of the Fund’s net assets at the end of year n - 1, calculated at 
the beginning of year n. 

To adjust the Fund to the 9% of the total outstanding capital liabilities, an amount of 
EUR  260.17  million  was  inserted  to  the  budget  2012  for  the  contribution  into  the 
Fund. At 31.12.2010, the target amount was EUR 1,745.63 million corresponding to 
the 9% of the total outstanding guaranteed operations (EUR 19,395.86 million). The 
difference  between  the  target  amount  and  the  net  assets  of  the  Fund  EUR 1,485.46 
million at 31.12.2010 was equal to EUR 260.17 million. 

This  amount  was  requested  for  the  provisioning  of  the  Fund  in  2012  and  was 
approved  by  the  Council  and  the  European  Parliament  in  November  2011.  It  was 
subsequently recognised as areceivable of the Fund from the budget.  

On 28.02.2011 an amount of EUR 138.88 million was transfered from the budget to 
the  Fund  corresponding  to  the  provisioning  amount  2011  (see  details  in  paragraph 
3.2.1 provisioning of the Fund). 

The Regulation stipulates that operations concerning accession countries covered by the Fund remain 
covered  by  the  EU  guarantee  after  the  date  of  accession.  However,  from  that  date  they  cease  to  be 
external actions of the EU and are covered directly by the general budget of the European Union and no 
longer by the Fund. 

(2) 

2 

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2.3. 

Significant transaction after the reporting date 

On 20 February 2012 an amount of EUR 260.17 million was transfered from the budget to the 
Fund corresponding to the provisioning for 2012. 

2.4. 

Presentation of the accounts 

Since  the  Commission  decided  to  present  its  accounts  in  accordance  with  new  accounting 
rules based on IPSAS3/IFRS principles, the pre-consolidated financial statements for the Fund 
have also been drawn up in accordance with these principles, as explained in the SWD.  

2.4.1.  Basis of preparation 

The Fund's financial statements have been prepared in accordance with the accounting rules 
adopted  by  the  Accounting  Officer  of  the  European  Commission,  in  particular  "Accounting 
rule 11 - Financial assets and liabilities"4. 

2.4.2.  Changes in accounting policy 

In the financial statements 2011 the Fund has changed its accounting policy for contributions. 
According to the previous accounting policy applied up to 31 December 2010, contributions 
were recognised or derecognised in the Fund’s balance sheet at the date payments from or to 
the European Commissions were received or made. Under the new accounting policy applied 
since  1  January  2011,  contributions  are  recognised  or  derecognised  in  the  Fund’s  balance 
sheet  at  the  date  when  they  become  due  or  owed  according  to  articles  3,  4,  5  and  6  of  the 
Regulation. 

This change in accounting policy for contributions provides more relevant information about 
the balance sheet of the Fund, as Guarantee Fund funding decisions made and published are 
obligatory expenditures from the general budget of the European Union5.  

The accounting policy change has been retrospectively applied and comparative information 
has  been  adjusted  accordingly.  The  accounting  policy  change  results  in  the  following 
adjustments to the balance sheet:  

Increase in current assets - contributions receivable by EUR 260,170,000 (Comparative 
figures 2010: increase in current assets – contributions receivable by EUR 138,880,000)  
Increase in contributions allocated but not yet paid in by EUR 260,170,000 (comparative 
figures 2010: increase by EUR 138,880,000). 

2.4.3. 

Impact of changes in accounting policy 

The changes have no impact on the economic outturn account or on the provisioning 
calculation. 

3 
4 

5 

IPSAS, International Public Sector Accounting Standards. 
This is based on the revised standards IAS 32 and 39 as issued by the IASB on 18 December 2003 and 
consequently, does not integrate the carved out provisions as set out in the version of IAS 39 endorsed 
by the European Commission on 19 November 2004. 
Interinstitutional  agreement  (2006/C  139/01)  between  the  European  Parliament,  the  Council  and  the 
Commission on budgetary discipline and sound financial management, OJ L C139, 14.06.2006, p.1. 

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2.4.4.  Pre-consolidated financial statement for the Fund at 31 December 2011 

A pre-consolidated financial statement of the Fund is prepared in order to include accounting 
operations which are not included in the Fund's financial statement prepared by the EIB (see 
Staff  Working  Document).  The  need  to  include  such  operations  is  due  to  the  successive 
defaults which occurred since the existence of the Fund. If the beneficiary of a loan operation 
guaranteed  by  the  Fund  defaults,  the  pre-consolidated  balance  sheet  should  include  any 
arrears due plus the interest accrued on late payments and other accounting accruals6 until the 
full  repayments  of  amounts  due  to  the  Fund.  Thus,  there  will  be  a  full  set  of  financial 
statements  for  the  Fund  at  the  end  of  the  year  to  be  consolidated  in  the  EU  consolidated 
balance  sheet.  At  31.12.2011,  there  is  no  default.  So,  the  total  amount  indicated  in  the  pre-
consolidated balance sheet is EUR 1,756,205,156.06. 

The major changes in the presentation of accounts are explained in the notes and reconcile the 
figures with the EIB financial statement presented in the SWD.  

2.4.5.  Guarantee Fund: Pre-consolidated balance sheet 

The pre-consolidated balance sheet is the preparation of the balance sheet for its consolidation 
in the EU's consolidated financial statements. The main changes are explained in the notes to 
the balance sheet. 

Balance sheet: Assets in 
EUR 

CURRENT ASSETS 

2011 

2010 

Short-term Investments 

1,194,552,654.14

1,153,319,651.66

AFS Portfolio - cost 

1,206,885,759.50

1,134,968,726.10

AFS Portfolio – 

actuarial difference 

AFS Portfolio – 
adjustment to fair value 

913,066.98

(1,355,359.96)

(34,189,857.13)

(1,888,129.14)

AFS Portfolio - accruals 

20,943,684.79

21,594,414.66

Short-term receivables 

260,170,000.00

138,880,000.00

Others 

260,170,000.00

138,880,000.00

Cash and Cash Equivalents 

301,482,501.92

194,011,274.11

Current accounts 

1,340,446.23

1,426,322.04

Short-term deposits – 

299,600,000.00

123,637,000.00

6 

Other accounting accruals include exchange rate differences if any, payable in other liabilities (mainly 
the recovery fees due to the EIB). 

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nominal  

Accrued interests on 

short-term deposits 

Other cash equivalents – 

cost 

Accrued interests on 

other cash equivalents 

542,055.69

155,055.48

68,708,475.06

84,421.53

Total Current Assets  

1,756,205,156.06

1,486,210,925.77

TOTAL 

1,756,205,156.06

1,486,210,925.77

Balance Sheet: Liabilities in 
EUR 

2011 

2010 

A. EQUITY 

Capital (Guarantee Fund) 

987,277,788.12

623,172,973.21

Contributions paid in 

727,107,788.12

484,292,973.21

Contributions allocated in 

260,170,000.00

138,880,000.00

Reserves 

(34,197,488.08)

(1,845,165.61)

First Time application – 

Fair value reserve 

Change in fair value of 

AFS assets 

Accumulated surplus / 
deficit 

(7,630.95)

42,963.53

(34,189,857.13)

(1,888,129.14)

760,201,245.08

821,618,687.47

Results brought forward 

760,201,245.08

821,618,687.47

Economic result of the year 

42,152,800.96

42,517,372.53

Total Equity 

1,755,434,096.22

1,485,463,867.60

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CURRENT LIABILITIES 

Accounts Payables 

Others 

Total Current Liabilities  

770,809.98

770,809.98

770,809.98

747,058.17

747,058.17

747,058.17

TOTAL 

1,756,205,156.06

1,486,210,925.77

Notes to the balance sheet: 

•  ‘Short-term receivables/others’ contains the provisioning amount for 2012 due to be paid 
by the EU budget to the Fund in early 2012. It may also include the amount of calls on the 
Fund that may be receivable from time to time including the capital, interest and penalties 
due to the budget of the European Union following release of the Fund guarantee. 

•  The difference in ‘accumulated surplus’ in equity compared with the financial position of 
the  Fund  presented  in  the  SWD  is  explained  by  the  successive  repayments  of  calls  and 
penalties to the Fund. 

•  ‘Accounts payables/others’ in 2011 include the EIB management commission, audit fees, 
and the accrual of the recovery fees due to the EIB following payment of the penalty fees 
due to the Fund. 

•  In  2011  and  2010,  the  Commission  did  not  record  any  impairments  in  respect  of  EU 
sovereign and sovereign guaranteed bond holdings in the Fund portfolio. No impairments 
were recorded of its holdings of Greek sovereign and sovereign guaranteed bonds. 

•  The Fund exposure against EU sovereign risk per country can be found in the SWD. 

2.4.6. 

Guarantee Fund: Pre-consolidated economic outturn account 

In  the  same  way  as  the  balance  sheet,  the  pre-consolidated  economic  outturn  account  is 
prepared for inclusion in the consolidated financial statements of the EU. Main adjustments 
are explained in the note to the pre-consolidated economic outturn account. 

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Consolidated Economic 
Outturn Account in EUR 

2011 

2010 

Financial operations 
revenues 

Interest income 

Interest income on cash and 
cash equivalents 

Interest income on AFS 
assets 

44,976,268.71

43,367,717.93

4,118,369.38

1,359,361.52

40,771,673.71

40,351,233.09

Other Interest income 

86,225.62

80,574.54

Realised gains on sale of 
AFS assets 

Financial operations 
expenses 

Realised losses on sale of 
AFS assets 

Other financial charges 

Thereof: Management fees 

Surplus from non operating 
activities 

1,576,548.78

(2,823,717.61)

(850,345.40)

(1,940,019.61)

(883,448.14)

(739,809.98)

(850,345.40)

(715,037.50)

42,152,800.96

42,517,372.53

Economic result of the year 

42,152,800.96

42,517,372.53

Note to the pre-consolidated economic outturn account: 

‘Other financial charges’ include the EIB management commission, audit fees, and accrual of 
the recovery fees due to the EIB following payment of the outstanding penalty fees due to the 
Fund. 

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3. 

PAYMENTS TO OR FROM THE FUND 

This section explains the financial flows going to or out of the Fund. 

3.1. 

Legal basis for payments to the Fund from the general budget 

The Regulation was amended in 20077 to ensure a more efficient use of budgetary resources 
by  provisioning  the  Fund  on  the  basis  of  the  observed  amounts  of  guaranteed  loans 
outstanding. 

The target amount is 9 % of the loans and guaranteed loans outstanding, including all types of 
operations covered (EIB, MFA and Euratom loans) outside the EU. The difference between 
the  target  amount  and  the  value  of  the  Fund’s  net  assets  will  result  in  provisioning  from 
budget line 01040114 ‘Provisioning of the Guarantee Fund’ to the Fund or in payment from 
the Fund to the budget in the event of a surplus. 

The  amount  available  for  financing  the  Fund  is  provided  from  budget  line  01040114 
‘Provisioning of the Guarantee Fund’ under Heading 4 (External Relations). 

3.2. 

Payments to or from the general budget in the course of the financial year 

3.2.1.  Provisioning of the Fund 

On  the  basis  of  the  outstanding  guaranteed  operations  of  EUR 16,360.73 million  as  of 
31.12.2009,  an  amount  of  EUR 138.88 million,  was  inserted  in  budget  line  01040114 
‘Provisioning of the Guarantee Fund’ in the statement of expenditure in the general budget of 
the European Union for 2011. This amount was paid in one transaction from the budget to the 
Fund on 28 February 2011.  

3.2.2. 

Interest from the investment of the Fund’s liquid assets 

3.2.2.1.  Investment policy 

The  Fund’s  liquid  assets  are  invested  in  accordance  with  the  management  principles  laid 
down  in  the  Annex  to  the  Agreement,  as  amended  by  Supplementary  Agreement  No 1  of 
17/23 September 1996,  Supplementary  Agreement  No 2  of  26  April/8 May 2002, 
Supplementary Agreement No 3 of 25 February 2008 and Supplementary Agreement No 4 of 
9 November 2010. Accordingly, 20 % of the Fund must be invested in short-term investments 
(up  to  one  year).  These  investments  include  variable-rate  securities,  irrespective  of  their 
maturity dates, and fixed-rate securities with a maximum of one year remaining to maturity, 
irrespective  of  their  initial  maturity  period.  This  is  because  fixed-rate  securities  are 
reimbursable  at  100 %  of  their  nominal  value  at  the  end  of  their  life,  while  variable-rate 
securities can usually be sold at any time at a price close to 100 %, whatever their remaining 
period  to  maturity.  To  maintain  a  balance  between  the  various  instruments  providing  the 
required  liquidity,  a  minimum  of  EUR 100  million  is  kept  in  money  market  instrument, 
particularly bank deposits. 

7 

Council Regulation (EC, Euratom) No 89/2007 of 30 January 2007 amending Council Regulation (EC, 
Euratom) No 2728/94 establishing a Guarantee Fund for external actions, OJ L 22, 31.1.2007, p. 1. 

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The list of banks authorised to receive deposits is agreed by the Commission and the EIB. The 
list  has  been  regularly  revised  in  the  light  of  the  changes  in  bank  ratings.  All  banks  have  a 
Moody’s rating of at least P1 for short-term investments or an equivalent Standard & Poor’s 
or  Fitch  rating.  The  investments  made  with  them  are  governed  by  rules  to  ensure  a 
competitive return and to avoid any concentration of risk. 

3.2.2.2.  Performance 

In an unfavorable economic environment the Fund delivered an absolute return of +0.7157%.  

Financial markets in 2011 were mainly influenced by the continuing sovereign debt crisis in 
Europe.  Financial  market  conditions  deteriorated  sharply  over  the  summer  on  the  back  of 
sovereign debt concerns in the euro area despite the discussions about the extension of the EU 
rescue  facility,  the  establishment  of  a  permanent  crisis  mechanism  starting  mid-2013 
(subsequently  brought  forward  to  mid-2012)  and  intensive  efforts  to  resolve  Greece's 
financing problems.  

Risk  premiums  and  interest  rates  on  government  bonds  in  2011  increased  in  particular  for 
countries on the periphery of the euro area.  

As  a  consequence  the  performance  of  the  Fund  was  very  volatile  during  the  year  and  was 
strongly impacted by uncertainty and volatility affecting the financial markets. The portfolio 
underperformed its benchmark8 by (138.85) basis points (see section 2.4. ‘Performance’ of the 
SWD  for  details)  mainly  due  to  the  decrease  in  the  market  value  of  the  greek  bonds  in  the 
portfolio9. 

3.2.2.3.  Financial operations revenues 

In 2011, interest income on cash and cash equivalents, on the Fund’s current accounts and on 
securities totalled EUR 44,976,268.71, broken down as follows: 

Description: 

2011 

2010 

Interest income on cash and cash equivalent 

4,118,369.38  

1,359,361.52 

interests received on short-term deposits

3,797,877.59  

1,253,213.48 

change in accrued interest on short-term deposits

302,578.68  

91,363.69 

Interest on current bank accounts

17,913.11  

14,784.35 

Interest income on AFS assets 

40,771,673.71  

40,351,233.09 

interest received - Available For Sale portfolio

41,853,323.85  

39,633,686.93 

change in accrued interest – Available For Sale 
portfolio

(650,729.87)  

1,396,474.35 

8 
9 

Due to the insufficient ratings, Greek and Portuguese bonds are not represented in the benchmark.  
Due to the insufficient ratings, Greek and Portuguese bonds are not represented in the benchmark.  

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premium discount

(430,920.27)  

(678,928.19) 

Income from securities lending activities 

86,225.62  

80,574.54 

Realized gain on sale of financial assets 

-  

1,576,548.78 

Interest from financial investment of the Fund's 
liquid assets 

44,976,268.71  

43,367,717.93 

The interest received is entered in the results for the financial year. 

3.2.2.4.  Financial operations expenses 

financial  operations  expenses  amounted 

The 
(EUR  2,823,717.61)  of  which 
(EUR 1,940,019.61)  relate  to  realised  losses  on  sales  of  available  for  sale  assets.  The  rest 
includes  the  EIB  management  fees  for  (EUR  739,809.98),  other  financial  charges  for 
EUR (111,527.16) and the external audit fees for (EUR 32,111.00). 

to 

4. 

THE FUND’S LIABILITIES 

The Fund's liabilities correspond to all the financial commitments due by the Fund. 

4.1. 

Default payments 

In 2011, no calls related to defaults were made to the Fund. 

• 

Potential calls on the Guarantee Fund following defaulted payments 

In  the  wake  of  a  deteriorating  situation  in  Syria  resulting  from  serious  violations  of  human 
rights  and  fundamental  freedoms,  the  Foreign  Affairs  Council  of  23  May  2011  decided  to 
suspend all preparations in relation to new bilateral cooperation programmes and to suspend 
the  ongoing  bilateral  programmes  with  the  Syrian  authorities  under  the  European 
Neighbourhood  and  Partnership  Instrument  (ENPI)  and  MEDA  instruments.  Moreover,  the 
Council  invited  the  EIB  to  not  approve  new  financing  operations  in  Syria.  The  European 
Parliament  in  its  Resolution  of  7  July  2011  welcomed  the  Council  conclusions  to  impose 
restrictive measures on Syria as well as the suspension of new EIB operations in the country. 

In addition, the Council decided on 14 November 2011 to prohibit disbursements by the EIB 
in  connection  with  existing  loan  agreements  between  Syria  and  the  EIB  as  well  as  suspend 
EIB  technical  assistance  contracts  for  sovereign  projects  in  Syria  .  This  Decision  has  been 
thereafter  consolidated  in  Council  Decision  2011/782/CFSP  of  1st  December  2011  and 
Council Regulation (EU) N° 36/2012 of 18 January 2012. 

• 

Event after the reporting date 

On 29 February 2012, the Commission was informed that a total of about EUR 15.4 million 
of repayments of loans granted to the Arab Republic of Syria due in November and December 
2011  was  still  unpaid.  The  Fund  could  therefore  expect  to  receive  calls  to  cover  the 
repayments  of  these  loans  during  the  first  semester  2012  if  the  Bank  would  not  receive  the 
amounts due by the Arab Republic of Syria.  

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4.2. 

EIB remuneration 

The second Supplementary Agreement to the Agreement signed on 26 April and 8 May 2002 
lays  down  that  the  Bank’s  remuneration  is  to  be  calculated  by  applying  degressive  annual 
rates of fees to each tranche of the Fund’s assets. This remuneration is calculated on the basis 
of the annual average assets of the Fund. 

The  Bank’s  remuneration  for  2011  was  set  at  EUR 739,809.98  and  was  entered  in  the 
economic outturn account and as accruals (liabilities) on the balance sheet.  

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