COMMISSION STAFF WORKING DOCUMENT Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL ON THE GUARANTEE FUND FOR EXTERNAL ACTION AND ITS MANAGEMENT IN 2016
Date: 2017-09-14
Institutions: Directorate-General for Economic and Financial Affairs, European Commission
Subjects: Community loan, European Investment Bank, budgetary reserve (EU), closing of accounts, credit guarantee, financial control, fund (EU), general budget (EU), publication of accounts

EUROPEAN 
COMMISSION 

Brussels, 14.9.2017 
SWD(2017) 296 final 

COMMISSION STAFF WORKING DOCUMENT 
Accompanying the document 

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

ON THE GUARANTEE FUND FOR EXTERNAL ACTION AND ITS 
MANAGEMENT IN 2016 

{COM(2017) 488 final} 

EN 

   EN 

 
 
 
 
  
 
 
TABLE OF CONTENTS 

1. 

2. 

2.1. 

2.2. 

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

Fund Management report ............................................................................................. 3 

Development of the Fund in 2016 ........................................................................... 3 

Situation of the Fund ............................................................................................... 4 

2.2.1. Contributions as at 31 December 2016 ........................................................................ 4 

2.2.2. The Fund’s holdings net of accrued interest at 31 December 2016 ............................. 4 

2.3. 

General and segmental analyses of the Fund .......................................................... 5 

2.3.1. Liquidity analysis ......................................................................................................... 5 

2.3.2. General analysis of the results of the Fund .................................................................. 5 

2.3.3. Analysis by segment .................................................................................................... 5 

2.4. 

Benchmarking, performance and interest rate risk analysis .................................. 13 

2.4.1. Benchmarking ............................................................................................................ 13 

2.4.2. Performance ............................................................................................................... 15 

2.4.3. Interest rate risk .......................................................................................................... 15 

3. 

Guarantee Fund Financial Statements as at 31 December 2016 ................................ 16 

3.1. 

3.2. 

3.3. 

3.4. 

3.5. 

3.6. 

3.7. 

3.8. 

3.9. 

General disclosures ................................................................................................ 21 

Significant accounting policies ............................................................................. 21 

Financial Risk Management .................................................................................. 27 

Fair value of financial instruments ........................................................................ 36 

Bond portfolio ....................................................................................................... 38 

Cash and cash equivalents ..................................................................................... 39 

Contributions ......................................................................................................... 39 

Other payables (in EUR) ....................................................................................... 40 

Subsequent events ................................................................................................. 40 

2 

 
 
 
 
1. 

INTRODUCTION 

According to the Article 7 of the Guarantee Fund Regulation, the assets of the Guarantee Fund 
(the "Fund") are managed by the EIB (the "Bank"). The agreement signed between the European 
Commission (the "Commission") and the Bank defines the principles governing the management 
of assets. 

Under  Article 8(2)  of  the  Agreement,  at  the  beginning  of  March  of  each  year  the  Bank  has  to 
send the Commission  an annual status  report  on the Fund and  the management thereof  and the 
financial statements of the Fund for the preceding year. 

The  management  report  on  the  Fund  is  presented  in  the  section  2  of  this  Commission  Staff 
Working Document (SWD). The financial statements audited by an external auditor are included 
in section 3. 

2. 

FUND MANAGEMENT REPORT 

2.1. 

Development of the Fund in 2016 

As  at  31  December  2016  total  assets  (excluding  accrued  interest)  of  the  Guarantee  Fund  (the 
to  EUR  2,490.71  million  against  EUR  2,328.1  million  as  at 
“Fund”)  amounted 
31 December 2015, an increase of EUR 162.6  million. 

Fig.1: Development of total assets in 2016 and 2015 

The  net  operating  result  amounted  to  EUR  29.85  million  at  31  December  2016  compared  with 
EUR 32.34 million at 31 December 2015 representing a decrease of 7.7%. 

1 

The  balance  of  total  assets  includes  a  contribution  receivable  of  EUR  240.5  million  which  is  due  to  be  paid  in  2017 
(2015: EUR 257.1 million). In the chart presented in figure 1 contributions receivable are recognized as assets in December 
of the corresponding years. 

3 

 
 
 
 
 
 
                                                 
2.2. 

Situation of the Fund  

2.2.1.  Contributions as at 31 December 2016 

2.2.1.1.  Contributions paid in as at 31 December 2016 

The  net  contributions  paid  into  the  Fund  by  the  European  Union  budget  increased  by 
EUR 146.3 million  or  13.1%  from  EUR  1,112.6  million  at  31  December  2015  to  EUR  1,258.8 
million at 31 December 2016.  

This is explained by the movements shown in the following table: 

Contributions paid in (in EUR) 

Provisioning 

Repayment of surplus 
Activation of guarantee calls 
Recovery of historic called amounts 
Repayment of Funds  

Situation at 
31/12/2015 

3,748,326,975 

-1,775,870,000 
-682,903,987 
578,854,354 
-755,856,713 

Movements in 2016 

Situation at 
31/12/2016 

257,121,792 

4,005,448,767 

0 
-110,828,866 
0 
0 

-1,775,870,000 
-793,732,853 
578,854,354 
-755,856,713 

Balance 

1,112,550,629 

146,292,926 

1,258,843,555 

2.2.1.2.  Contributions payable and receivable as at 31 December 2016 

As  at  31  December  2016  the  Fund  has  recorded  EUR  Nil  (2015:  EUR  22.1  million)  as 
contributions payable (2015: three guarantee calls provisioning for three guarantee calls made by 
the  European  Investment  Bank  with  regard  to  Syrian  loan  defaults).  In  addition,  as  at  31 
December  2016  the  Fund  has  recorded  EUR  240.5  million  (2015:  EUR  257.1  million)  as 
contributions to be paid in by the European Union. 

2.2.2.  The Fund’s holdings net of accrued interest at 31 December 2016 

The  Fund’s  holdings  at  31  December  2016  excluding  accrued  interest  and  contributions 
receivable totalled EUR 2,250.2 million as detailed below: 

-  EUR 151.5 million in the monetary portfolio (nominal value of interbank term deposits); 
-  EUR 45.4 million in the current accounts;  
-  EUR  2,053.3  million  in  the  Available  For  Sale  (AFS)  (portfolio  market  value  of  fixed  rate 
bonds,  floating  rate  bonds,  zero-coupon  bonds  and  commercial  papers,  excluding  accrued 
interest). 

The Fund operates in one currency only, the Euro. 

4 

 
 
 
  
 
 
2.3. 

General and segmental analyses of the Fund 

2.3.1.  Liquidity analysis 

The  liquidity  position  of  the  Fund  at  31  December  2016  is  outlined  in  the  table  below.  The 
liabilities  shown  in  the  column  "maturity  undefined"  represent  the  Contributor's  (i.e.  European 
Union's) resources.  

Liquidity position as at 31 December 2016 (in EUR million): 

Maturity 

Total assets 

less than 
3 months 
520 

3 months to 
1 year 
25 

1 to 10 years 

1,961 

maturity 
undefined 
0 

Total 

2,506 

Total net assets 

Total liabilities  

Total net 
liabilities 

assets 

and 

0 

-1 

-1 

Net liquidity position 

519 

0 

0 

0 

25 

0 

0 

0 

-2,505 

-2,505 

0 

-1 

-2,505 

-2,506 

1,961 

-2,505 

0 

2.3.2.  General analysis of the results of the Fund 

Overall,  during  the  reporting  period  1  January  2016  to  31  December  2016  the  Fund  achieved 
EUR 29.85 million in net revenue. The following table outlines the net revenue earned in 2016 
and compares it with 2015: 

In EUR million 

Interest income on cash & cash equivalents 
Interest income on AFS assets 
Realised gain on sale of AFS assets 
Income from securities lending activity 
Interest expense on cash & cash equivalents 
Realised loss on sale of AFS assets 
Commission and other charges 

From 1 January to 
 31 December 2016 

From 1 January to  
31 December 2015 

0.00 
14.39 
16.76 
0.12 
-0.34 
0.00 
-1.08 

0.0%
48.2%
56.1%
0.4%
-1.1%
0.0%
-3.6%

0.03 
24.23 
9.18 
0.11 
-0.01 
-0.15 
-1.05 

0.1%
74.9%
28.4%
0.3%
0.0%
-0.5%
-3.2%

Total 

29.85 

100.0%

32.34 

100.0%

2.3.3.  Analysis by segment 

2.3.3.1.  Analysis of money market operations 

Money-market  investments  (excluding  accrued  interest)  amount  to  EUR  196.9  million  at 
31 December 2016, as compared to EUR 83.92 million the year before. 

2 

This amount excludes short-term deposits under settlement. 

5 

 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
  
  
  
 
                                                 
•  Evolution of money-market rates in 2016 

The market developments of the year 2016 were strongly influenced by central bank activity and 
heightened political risk caused by surprise events of Brexit, US presidential election results and 
Italy  constitutional  referendum.  After  the  first  hike  of  FED  funds  rate  in  December  2015,  the 
FED continued its cycle in December 2016. ECB monetary policy remained accommodative. 

During its March meeting, ECB extended its quantitative easing program by lowering the main 
refinancing  rate  to  zero  and  the  rate  of  the  deposit  facility  to  -0.40%.  QE  was  expanded  by 
additional EUR 20bn per month and extended to investment grade corporate bonds. On the credit 
side  and  in  order  to  provide  further  incentives  for  banks  to  lend  out,  a  new  TLTRO  II  was 
launched with more favourable borrowing conditions relative to TLTRO. 

Economic  activity  in  the  Eurozone  was  mixed  in  2016  with  generally  week  growth.  After 
reaching its lows in February, the trend of oil price has turned and helped to evaporate deflation 
expectations. As a result, Eurozone inflation returned to positive area and approached 1% by year 
end.  

The  ECB  announced  in  December  an  update  of  the  asset  purchase  program,  with  timeframe 
extended by nine months (until December 2017) and the monthly volume of purchases reduced to 
EUR  60bn  from  EUR  80bn.  The  time  extension  combined  with  the  decrease  in  the  monthly 
purchases left some commentators pondering upon whether or not the ECB was in fact laying the 
ground  for  a  gradual  phase-out  (tapering)  of  the  quantitative  easing,  with  potentially  disruptive 
consequences  for  the  EUR  interest  rates.  ECB  officials  rushed  to  ensure  the  markets  that  the 
December’s  revision  of  the  QE  should  not  be  interpreted  as  tapering.  The  phase-out,  if  any, 
would be entirely driven by the flow of macroeconomic data, with particular regard to inflation, 
while the program itself could even be adjusted upwards if required to meet the ECB’s target of 
close to but below 2.0% inflation. 

Money  market  rates  and  bond  market  yields  were  well  supported  by  the  ongoing  quantitative 
easing and extended asset purchases of the ECB throughout 2016. However, in the 4th quarter of 
the year, in connection with mostly external factors including changing global economic policy 
mix  favouring  fiscal  expansion  and  higher  economic  growth  with  increasing  FED  rate  hike 
expectations,  the  bond  market  rally  has  been  terminated  with  long  tenors  already  selling  off 
significantly.  After  the  German  10  year  bund  has  reached  historical  low  of  -0.20%  in  July,  it 
moved  to  the  area  of  0,30-0,40%  by  year-end.  In  the  meantime  the  short-end  of  the  curve  is 
further  supported  by  central  bank  asset  purchases,  which  resulted  the  German  2-year  schatz  to 
decrease further and reach its historical low around the end of the year below -0.80%. Thus yield 
curves became significantly steeper, the German 2/10 year segment steepened from 60 close to 
120 basispoints. 

6 

 
 
 
 
 
 
 
Fig. 2: Evolution of Money Market rates during 2016 (source Reuters) 

•  Profile of counterparties 

In accordance with the agreement between the European Union and the EIB on the management 
of the Fund, all banks with which deposits are placed should have a minimum short-term credit 
rating of P-1 (Moody's or equivalent). The breakdown, including accrued interest, is as follows: 

Fig. 3: Short term interbank investments by profile of counterparty at 31 December 2016 

2.3.3.2.  Analysis of bond portfolio results 

The  bond  portfolio,  seen  as  a  long-term  investment  portfolio,  is  made  up  of  euro-denominated 
securities  initially  acquired  with  the  intention  of  holding  them  until  maturity.  In  the  Fund’s 
Financial Statements these securities are  classified as  Available for Sale (AFS) in line with the 
EC accounting rule 113. At 31 December 2016, the market value (excluding accrued interest) of 

3 

The Available for Sale portfolio also includes the zero-coupon bonds and commercial papers with original maturities of more 
than three months. 

7 

 
 
 
 
 
 
 
 
 
                                                 
securities  with  a  residual  period  to  maturity  of  less  than  three  months  amounted  to 
EUR 82.1 million,  between  3 months  and  one  year  EUR  25.2  million  and  between  one  and 
10 years EUR 1,946.0 million. 

The starting value of the securities in this portfolio is the acquisition cost. The difference between 
the entry price and the redemption value is the premium/discount spread, which is amortised over 
the remaining life of each of the securities using the effective interest rate method as specified in 
the EC accounting rules. 

At  31  December  2016, 
EUR 1,944.8 million, against a clean market value of EUR 2,053.3 million. 

the  nominal  value  of 

the 

investment  bond  portfolio  was 

The global (modified) duration of the bond portfolio increased over 2016 to reach 3.59 years at 
the  end  of  the  year.  As  of  31  December  2016,  the  clean  market  value  of  the  investment  bond 
portfolio came to EUR 2,053.3 million (2015: EUR 1,987.1 million) compared with a book value 
(including  premiums/discounts)  of  EUR  2,017.8  million  (2015:  EUR 1,954.9  million),  which 
gives an unrealised fair value result of EUR +35.5 million (2015: EUR +32.2 million).  

The  front  end  of  the  German  government  curve  declined deeper into  negative territory as ECB 
launched,  continued  the  Public  Sector  Purchase  Programme,  lowered  its  deposit  rate  and 
extended the asset purchase program until end 2017. The long end of the yield curve has already 
started to rise in Q4 2016, due to normalizing inflation figures, but also following rising US rates. 

Fig. 4: Quasi parallel shift of the Euro sovereign yield curve during 2016 (source Bloomberg) 

The decline of the yield curve had a positive impact on the Fund’s portfolio performance, which 
in terms of the absolute return amounted to 119 basis points. 

8 

 
 
 
 
 
 
 
 
 
 
 
 
In line with the 2016 approved investment strategy and in compliance with the guidelines, a total 
nominal  amount  of  EUR  789.64  million  was  invested  in  four  asset  classes:  SSA  (EUR  400.2 
million or 50.7%), covered bonds (EUR 176.7 million or 22.4%), corporate bonds (EUR 109.2 
million  or  13.8%)  and  financials  (EUR  103.5  million  or  13.1%)  either  on  an  outright  or  on  a 
switch basis. The purchases were made both on the primary and on the secondary market. All of 
the  transactions  aimed  to  maximize  the  risk  return  profile  of  the  portfolio  while  satisfying  the 
liquidity constraints. The charts below outline the total 2016 investments per asset class as well 
as in terms of country distribution. 

Fig. 5: 2016 Investments per asset class 

4 

This amount does not include the zero-coupon bonds and commercial papers. 

9 

 
 
 
 
 
 
 
                                                 
Fig. 6: 2016 Investments per country of exposure 

The below chart displays the maturity and instrument format split of the 2016 investments. It can 
be inferred from the chart that the 5Y tenor, as most attractive spot on the yield curve in terms of 
risk  and  return  consideration  and  supply  dynamics  of  new  issuances  (but  also  in  view  of  the 
overall Guarantee Fund portfolio duration management) has been favoured. 

Fig. 7: 2016 Investments per maturity tenor and instrument type 

10 

 
 
 
 
 
 
 
 
 
 
 
 
•  Breakdown of the investment portfolio between fixed rate and variable rate securities (nominal value) 

Fig. 8: Investment portfolio breakdown between fixed5 and variable rate securities at 31 December 2016 

•  Redemption profile of investment portfolio (nominal value) 

Fig.9: Investment portfolio: Redemption profile at 31 December 2016 

The latest final maturity date for fixed rate securities is 7 December 2026. 

5 

The fixed rate portfolio includes the zero-coupon bonds and commercial papers. 

11 

 
 
 
 
 
 
 
                                                 
Profile of issuers 

All the securities held in the portfolio are in line with the management guidelines and meet the 
following criteria for: 
Securities issued or guaranteed by Member States4: minimum rating Baa3; 
Securities issued (or guaranteed) by a Supranational in which Member States are involved, other 
States,  regional  or  local  governments,  public  enterprises  or  institutions  belonging  to  a 
government or controlled by the latter: minimum rating Aa2; 
Covered Bonds or other legal bodies (including structured products): minimum rating Aaa; 
Securities issued by other legal bodies (excluding CBs and structured products): minimum rating 
Aa2. 

The profile of issuers by issuer type and long term rating5 of the investment portfolio (nominal 
amount) at 31 December 2016 is as follows: 

Fig.10: Investment portfolio: Profile of issuers at 31 December 20166 

4  Member States securities (including securities guaranteed by Member States) may be kept in an event of downgrade below 

5 

the minimum requirements. This applies also to cases where the rating downgrade would trigger a lower limit. 
Reported ratings are ratings of the respective issues. In the absence of all bond/issue ratings, the respective issuer ratings (in 
case of guaranteed positions the guarantor ratings) have been reported. 

12 

 
 
 
 
 
 
 
 
                                                 
2.4. 

Benchmarking, performance and interest rate risk analysis 

2.4.1.  Benchmarking 

The performance of the Fund is monitored on a marked-to-market (MTM) basis against a 
composite index. This index is the result of the combination of the following sub-indices: 
• 

Euribid 1M for money-market operations 

• 

• 

• 

Euribid 3M for floating rate notes and fixed rate bond with less than one year to maturity 

IBOXX  EUR  Sovereign  indices  for  fixed  rate  bonds  issued  by  sovereign  (or  similar) 
issuers, split by maturity buckets  

IBOXX  EUR  Collateralized  Covered  indices  for  fixed  rate  bonds  issued  by  non-
sovereign issuers, split by maturity buckets  

Index weightings are based on portfolio composition and are reviewed: 

• 

• 

at  each  end-month  day:  the  dates  which  define  the  time  buckets  (up  to  1y,  from  1y  to  3y, 
from 3y o 5y, from 5y to 7y and from 7y to 10y) are updated. As a consequence, the shifts 
between buckets due to the aging of existing positions are accounted only once per month at 
end-month, following the same procedure underlying the managing of the IBOXX’s indexes; 

during  the  month,  whenever  a  change  higher  than  ±5%  in  one  of  the  asset-classes  (with 
respect to the last benchmark’s adjustment) is observed. This change can be the result of: 

- 

- 

the  impact  of  a  contribution  from  the  European  Commission  to  the  portfolio  (external 
cash flows from the European Commission); 

the impact of a withdrawal from the portfolio to the European Commission (external cash 
flows to the European Commission); 

- 

the impact of a transaction settled (sales and purchases); 

- 

the impact of a redemption; 

- 

the  sum  of  the  impacts  of  previous  events  accumulated  from  the  last  benchmark’s 
adjustment, taking also into consideration the changes in the clean values of the positions. 

6 

The  “Other”  category  presented  in  figure  10  includes:  Banks  Aa1  (1.29%),  Corporates  Aa1  (1.28%),  Member  State  Aa3 
(1.03%),  Member  State  A3  (0.72%),  Banks  Aa3  (0.51%),  Member  State  Baa3  (0.51%),  Non-EU  Public  Institutions  Aa2 
(0.26%), Supranational Aaa (0.26%), Non-EU Public Institutions Aaa (0.21%). 

13 

 
 
 
                                                                                                                                                              
Bucket 
(years) 

Performance Benchmark 
Sector 

Instrument 

Average Clean Market 
Value Composition of 2016 

Money Market
FRN and Fixed Rate 
Bonds

Fixed 
Rate 
Bonds 

1 m 

3 m 

sovereign 

covered bonds 

sovereign 

covered bonds 

sovereign 

covered bonds 

sovereign 

covered bonds 

0-1 

1-3 

3-5 

5-7 

7-10 

Total 

10.3% 

13.2% 

6.3% 

5.1% 

21.3% 

18.4% 

12.3% 

9.1% 

3.3% 

0.7% 

100.00% 

14 

 
 
 
 
 
  
 
 
 
 
 
 
 
2.4.2.  Performance 

The performance of the Fund portfolio was monitored on a marked-to-market basis. During 2016, 
the portfolio delivered a 1.5563% MTM yearly return, outperforming its  benchmark  by +36.35 
bps. The evolution of the portfolio return and excess return vis-à-vis its benchmark is presented 
in the following table: 

Portfolio 

Out-performance 

Market Value 
(including accrued 
interest) 

Monthly  
return (absolute 
return in %) 

YTD  return 
(absolute return 
in %) 

31/01/2016 

29/02/2016 

31/03/2016 

30/04/2016 

31/05/2016 

30/06/2016 

31/07/2016 

31/08/2016 

30/09/2016 

31/10/2016 

30/11/2016 

31/12/2016 

2,096,033,946 

2,346,683,034 

2,344,080,716 

2,341,402,523 

2,341,091,766 

2,352,164,085 

2,342,069,835 

2,339,135,475 

2,328,656,706 

2,316,828,306 

2,279,306,860 

2,265,816,160 

2.4.3. 

Interest rate risk 

0.6614 

0.3747 

0.0291 

-0.1144 

0.3182 

0.4732 

0.3473 

0.0177 

0.0802 

-0.5074 

-0.3279 

0.1996 

0.6614 

1.0385 

1.0679 

0.9523 

1.2735 

1.7527 

2.1061 

2.1241 

2.2060 

1.6875 

1.3540 

1.5563 

Monthly 
Excess Return 
compared to 
benchmark 
(in%) 
0.0453 

0.1023 

-0.0381 

0.0272 

-0.0189 

0.0259 

0.0965 

0.0193 

-0.0071 

0.0872 

0.1162 

-0.0975 

YTD 
Excess 
Return 
(in%) 

0.0453 

0.1484 

0.1100 

0.1374 

0.1188 

0.1455 

0.2440 

0.2638 

0.2568 

0.3443 

0.4609 

0.3635 

The interest rate risk sensitivity of the MTM value of the portfolio mainly stems from its fixed 
rate exposure. A 1bp increase of interest rates reduces the value of the portfolio by EUR 813,908 
of which EUR 809,729 is related to the fixed rate bond exposure. The global modified duration of 
the  fund  increased  during  2016  and  stood  at  3.59  years  as  of  31  December  2016,  compared  to 
3.21 years as of 31 December 2015. 

GF Sub- Portfolios 

Floating Rate Notes 

Fixed Rate Bonds 
Money Market 
Instruments 
Cash account 
Total GF 

Market Value (excluding 
accrued interest) 
155,579,358 

1,867,673,111 

181,511,622 

45,431,504 

2,250,195,595 

Modified 
Duration (Years)

0.168 

4.300 

0.086 

Interest Rate 
Exposure (+/-1bp) 
+/- 2,618 

+/- 809,729 

+/- 1,561 

3.592 

+/- 813,908 

15 

 
 
 
  
 
 
  
  
  
  
  
  
  
  
  
  
  
  
 
 
 
 
3. 

GUARANTEE FUND FINANCIAL STATEMENTS AS AT 31 DECEMBER 2016 

GUARANTEE FUND 

FINANCIAL STATEMENTS 

AS AT 31 DECEMBER 2016 

− Balance sheet 

− Statement of financial performance 

− Statement of changes in net assets 

− Cash flow statement 

− Notes to the financial statements 

16 

 
 
 
 
 
 
 
 
 
 
 
 
 
                                                                                 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ASSETS 
NON-CURRENT ASSETS 
Available for Sale portfolio 

Bond portfolio – cost 

Bond portfolio – actuarial difference 

Bond portfolio – adjustment to fair value 

Total Available for Sale Portfolio 

TOTAL NON-CURRENT ASSETS 

CURRENT ASSETS 
Available for Sale portfolio 

Bond portfolio – cost 

Bond portfolio – actuarial difference 

Bond portfolio – adjustment to fair value 

Bond portfolio – accrued interest 

Total Available for Sale portfolio 

Short-term receivables 

Contributions receivable 

Total short-term receivables 

Cash and cash equivalents 

Current accounts 

Short-term deposits – nominal  

Short-term deposits - accrued interest 

Short-term deposits under settlement 

Total cash and cash equivalents 

TOTAL CURRENT ASSETS 
TOTAL ASSETS 

NET ASSETS AND LIABILITIES 
NET ASSETS 
Contributions  

Net contributions paid in 
Contributions payable as guarantee call 

Contributions allocated but not yet paid in 

Reserves 

Fair value reserve 

Accumulated surplus 

Economic result of the year 

TOTAL NET ASSETS 
LIABILITIES 
CURRENT LIABILITIES 
Guarantee call payable 

Other payables 

TOTAL CURRENT LIABILITIES 
TOTAL NET ASSETS AND LIABILITIES 

Balance sheet  

as at 31 December 2016 
(in EUR) 

Notes 

31.12.2016 

31.12.2015

5 

5 

7 

6 

1,925,695,346.90 

1,588,306,103.90

-14,941,415.17 

35,210,126.78 

-4,001,734.22

29,929,113.76

1,945,964,058.51 

1,614,233,483.44

1,945,964,058.51 

1,614,233,483.44

107,179,405.97 

370,666,625.76

-166,591.12 

283,519.70 

15,390,711.64 

-28,761.69

2,194,274.03

14,960,434.80

122,687,046.19 

387,792,572.90

240,540,250.00 

240,540,250.00 

257,121,792.00

257,121,792.00

45,431,503.50 

151,500,000.00 

-69,805.06 

0.00 

196,861,698.44 

560,088,994.63 
2,506,053,053.14 

49,145,562.99

44,800,000.00

-2,301.19

-10,000,000.00

83,943,261.80

728,857,626.70
2,343,091,110.14

Notes 

31.12.2016 

31.12.2015

7 

1,258,843,554.67 
0.00 

1,112,550,629.06
-22,130,631.78

240,540,250.00 

257,121,792.00

35,493,646.48 

32,123,387.79

940,394,573.31 

908,051,618.54

29,849,553.53 

32,342,954.77

2,505,121,577.99 

2,320,059,750.38

8 

931,475.15 

900,727.98

0.00 

22,130,631.78

931,475.15 
2,506,053,053.14 

23,031,359.76
2,343,091,110.14

17 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Statement of financial performance 

For the year ended 31 December 2016 
(in EUR) 

Expenses from operating activities 

      Management fees 

      Audit fees 

      Bank fees 

From 01.01.2016 
to 31.12.2016 

From 01.01.2015
to 31.12.2015

-1,074,112.12 

-1,045,413.10

-891,975.15 

-39,500.00 

-142,636.97 

-861,227.98

-39,500.00

-144,685.12

Result from operating activities 

-1,074,112.12 

-1,045,413.10

Financial revenue 

Interest income 

      Cash and cash equivalents 

      Bond portfolio 

Realised gain on sale of Bond portfolio 

Income from securities lending activity 

Financial expenses 

Interest expense 

       Cash and cash equivalents 

Realised loss on sale of Bond portfolio 

14,387,844.82 

24,252,802.28

831.14 

26,254.60

14,387,013.68 

24,226,547.68

16,756,863.88 

119,696.45 

9,176,573.59

115,809.80

-340,739.50 

-340,739.50 

-8,633.64

-8,633.64

0.00 

-148,184.16

Result from non-operating activities 

30,923,665.65 

33,388,367.87

ECONOMIC RESULT OF THE YEAR  

29,849,553.53 

32,342,954.77

Items directly recognised in net assets 

Net change in fair value of Bond portfolio 

Net amount transferred to statement of financial performance 

NET RESULT RECOGNISED IN NET ASSETS 

15,957,105.74 

-10,981,522.17

-12,586,847.05 

-12,996,945.49

3,370,258.69 

-23,978,467.66

18 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Statement of changes in net assets 

For the year ended 31 December 2016 
(in EUR) 

Balance as at 01.01.2015 

Contributions from the European Commission allocated but not yet paid 

Contributions paid to the EIB as guarantee call 

Change of contributions payable as guarantee call 

Change of fair value reserve 

Allocation of the Economic result of the year 2014 

Economic result of the year 2015 

Balance as at 31.12.2015 

Contributions from the European Commission allocated but not yet paid 

Contributions paid to the EIB as guarantee call 

Change of contributions payable as guarantee call 

Change of fair value reserve 

Allocation of the Economic result of the year 2015 

Economic result of the year 2016 

Balance as at 31.12.2016 

7 

7 

7 

5 

7 

7 

7 

5 

Contributions
1,150,514,734.55

257,121,792.00

-60,164,571.55 

69,834.28

Fair value 
reserve
56,101,855.45

Accumulated 
surplus
878,284,248.11

Economic result of 
the year
29,767,370.43

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

Total net assets
2,114,668,208.54

257,121,792.00

-60,164,571.55 

69,834.28

-23,978,467.66 

29,767,370.43

-29,767,370.43 

0.00

0.00

32,342,954.77

32,342,954.77

0.00

0.00

0.00

-23,978,467.66 

0.00

0.00

1,347,541,789.28

32,123,387.79

908,051,618.54

32,342,954.77

2,320,059,750.38

240,540,250.00

-110,828,866.39 

22,130,631.78

0.00

0.00

0.00

0.00

0.00

0.00

3,370,258.69

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

240,540,250.00

-110,828,866.39 

22,130,631.78

3,370,258.69

32,342,954.77

-32,342,954.77 

0.00

0.00

29,849,553.53

29,849,553.53

1,499,383,804.67

35,493,646.48

940,394,573.31

29,849,553.53

2,505,121,577.99

19 

 
 
 
 
 
 
 
 
Cash flow statement  

For the year ended 31 December 2016 
(in EUR) 

Operating activities 

     Treasury management fee paid during the year 

     Bank fees / audit fees paid during the year 

     Contributions paid  as guarantee call 

Net cash flows used in operating activities 

Investing activities 

Notes 

From 01.01.2016 
to 31.12.2016 

From 01.01.2015
to 31.12.2015

-861,227.98 

-182,136.97 

-844,872.97

-184,185.12

-110,828,866.39 

-60,164,571.55

-111,872,231.34 

-61,193,629.64

     Net interest received on cash and cash equivalents 

-272,404.49 

25,933.94

     Purchase of investments - Bond portfolio 

     Proceeds of investments - Bond portfolio 

     Interest received - Bond portfolio 

     Income from securities lending activity 

Net cash flows used in investing activities 

Financing activities 

5 

-991,735,364.00 

-1,054,379,125.37

930,234,324.63 

877,556,734.34

29,390,127.26 

29,483,128.69

119,696.45 

115,809.80

-32,263,620.15 

-147,197,518.60

      Contributions received from the European Commission  

7 

257,121,792.00 

144,409,518.00

Net cash flows from financing activities 

Net decrease in cash and cash equivalents 

Cash and cash equivalents at the beginning of the financial year 

Cash and cash equivalents at the end of the financial year 

257,121,792.00 

144,409,518.00

112,985,940.51 

-63,981,630.24

83,945,562.99 

147,927,193.23

196,931,503.50 

83,945,562.99

Cash and cash equivalents are composed of 
(excluding accrued interest): 

Current accounts 

Short-term deposits  

Short-term deposits under settlement 

Total cash and cash equivalents 

45,431,503.50 

151,500,000.00 

49,145,562.99

44,800,000.00

0.00 

-10,000,000.00

196,931,503.50 

83,945,562.99

20 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Notes to the financial statements as at 31 December 2016 

3.1. 

General disclosures 

The rules and principles for the management of the Guarantee Fund (the “Fund”) are laid out in 
the  Agreement  between  the  European  Commission  (the  “EC”)  and  the  European  Investment 
Bank  (the  “EIB”)  dated  25 November 1994  and  the  subsequent  amendments  to  the  Agreement 
dated  23 September  1996,  8 May  2002,  5 June  2002,  25  February  2008  and  9  November  2010 
(the “Convention”). 

The main principles of the Fund, as extracted directly from the Convention, are as follows: 

•  The Fund will operate in one single currency being Euro (EUR). It will exclusively invest 

in this currency in order to avoid any exchange rate risk. 

•  The management of the Fund will be based upon the traditional rules of prudence relating 
to  financial  activities.  Attention  is  given  to  control  the  risks  and  to  ensure  that  the 
managed assets have a sufficient degree of liquidity and transferability while considering 
the Fund’s commitments. 

The present financial statements cover the period from 1 January 2016 to 31 December 2016. 

EIB’s management has authorized the financial statements for issue on 24 March 2017. 

3.2. 

Significant accounting policies 

3.2.1.  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”  dated  December  2004  and  updated  in  October  2006, 
December 20096 and December 20112.  

The  financial  statements  have  been  prepared  on  a  going  concern  basis,  which  assumes  that  the 
Fund will be able to meet the mandatory payments of the guarantees.  

According  to  articles  3,  5  and  6  of  Council  Regulation  (EC,  Euratom)  No  480/2009  of 
25 May 2009  if,  as  a  result  of  the  activation  of  guarantees  following  one  or  more  defaults, 
resources in the Fund fall below the set target amount of 9% of total outstanding capital liabilities 
arising from each operation, plus any unpaid interest, then the European Commission transfers to 
the Fund the difference between the target amount and the value of the Fund’s net assets at the 
previous year-end balance sheet date.  

The  amounts  in  the  financial  statements  are  not  rounded  except  in  the  section  financial  risk 
management where the amounts are rounded to the nearest thousand EUR.  

6

2 

This is based on the revised standards IAS 32 and 39 as issued by the IASB in 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. 
This  accounting  rule  is  based  on  the  following  IPSAS  standard:  IPSAS  28  “Financial  Instruments:  Presentation”,  IPSAS  29  “Financial 
Instruments: Recognition and Measurement” and IPSAS 30 “Disclosures”. 

21 

 
 
                                                 
 
3.2.2. 

Changes in accounting policies 

The  Fund  has  consistently  applied  to  all  periods  the  accounting  policies  set  out  in  Note  2.4 
presented in these financial statements. 

3.2.3. 

Significant accounting judgments and estimates 

The  preparation  of  financial  statements  in  conformity  with  the  accounting  rules  adopted  by  the 
Accounting Officer of the European Commission requires the use of certain critical accounting 
estimates.  It  also  requires  the  EIB  Management  to  exercise  its  judgment  in  the  process  of 
applying  the  Fund’s  accounting  policies.  The  areas  involving  a  higher  degree  of  judgment  or 
complexity, or areas where assumptions and estimates are significant to the financial statements 
are disclosed hereafter. 

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

Measurement of fair value of financial instruments  

The fair value of financial assets and financial liabilities that are traded in active markets is based 
on quoted market prices or broker price quotations. Where the fair values of financial assets and 
financial liabilities recorded on the balance sheet cannot be derived from active markets, they are 
determined using a variety of valuation techniques that include the use of mathematical models. 
The input to these models is taken from observable markets where possible, but where this is not 
feasible, a degree of judgment is required in establishing fair values.  

Impairment losses on financial instruments  

The Fund reviews its financial instruments at each reporting date to assess whether an allowance 
for  impairment  should  be  recorded  in  the  statement  of  financial  performance.  In  particular, 
judgment by EIB Management is required in the estimation of the amount and timing of future 
cash flows when determining the level of allowance required. 

3.2.4. 

Summary of significant accounting policies 

3.2.4.1.  Foreign currency translation 

The Fund uses the Euro (EUR) for presenting its financial statements, which is also the functional 
currency. 

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

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

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

Exchange differences on non-monetary assets are a component of the change in their fair value. 
Depending on the classification of a non-monetary financial asset, exchange differences are either 
recognised in the statement of financial performance or within the reserves. 

22 

 
 
Exchange differences arising on the settlement of transactions at rates different from those at the 
date of the transaction, and unrealised foreign exchange differences on unsettled foreign currency 
monetary assets and liabilities, are recognised in the statement of financial performance. 

3.2.4.2.  Financial instruments 

All  financial  assets  are  recognised  in  the  balance  sheet  on  trade  date  basis  and  measured 
according to their assigned category. 

(a) 

Cash and cash equivalents 

The  Fund  defines  cash  and  cash  equivalents  as  current  accounts,  commercial  papers,  treasury 
bills and short-term deposits with original maturity of three months or less. 

(b) 

Bond portfolio 

The bond portfolio is composed of Euro-denominated securities.  

These  securities  are  classified  as  Available  for  Sale  (AFS)  according  to  the  accounting  rules 
adopted  by  the  Accounting  Officer  of  the  European  Commission  and  consequently,  are  carried 
out at their fair value through net assets.  

In  accordance  with  the  decision  of  the  Accounting  Officer  of  the  Commission4  concerning  the 
“Presentation of the Guarantee Fund for external actions and other Available for Sale portfolios” 
on  31 January  2013,  the  Available  for  Sale  financial  instruments  of  the  Fund’s  Portfolio  are 
categorised following the current/non-current distinction of Article 8.3 of the Accounting rule 1 
according  to  their  remaining  contractual  maturity  at  the  balance  sheet  date.  Available  for  Sale 
investments with a remaining maturity of less than a year and accrued interest with due date less 
than  a  year  are  presented  in  the  balance  sheet  as  current  assets,  while  Available  for  Sale 
investments with a remaining maturity of more than a year are presented in the balance sheet as 
non-current assets. 

Unrealised  gains  or  losses  are  reported  in  reserves  until  such  a  security  is  sold,  collected  or 
otherwise disposed  of,  or  until  such a security is determined to be impaired. Impairment losses 
identified are recognised in the statement of financial performance for the year.  

On disposal of an Available for Sale security, the accumulated unrealised gain or loss included in 
net assets is transferred to the statement of financial performance for the year. Interest income on 
Available for Sale securities is included in “interest income”.  

The determination of fair values of Available for Sale investments is generally based on quoted 
market rates in active markets. 

These  securities  are  initially  measured  at  their  acquisition  cost,  being  their  fair  value  at  this 
moment.  The  difference  between  the  entry  price  and  the  redemption  value,  i.e.  the 
premium/discount spread, is amortised over the remaining life of each of the securities using the 
effective interest rate method as specified under Accounting rule 11. 

4 

Decision of the Accounting Officer. Subject: Presentation of the Guarantee Fund for external actions and other available for sale portfolios 
(Ref. Ares (2013) 122752 – 31/01/2013). 

23 

 
 
 
                                                 
Securities are considered impaired if there is objective evidence of impairment as a result of one 
or more events that occurred after the initial recognition of the security (a “loss event”) and that 
loss event has an impact on the estimated future cash  flows of the security  that can be reliably 
estimated.  

Evidence  of  impairment  is  mainly  about  significant  financial  difficulties  of  the  issuer,  e.g.  a 
breach of contract, a restructuring of the debt of the issuer or a high probability of bankruptcy. It 
is  important  to  stress  that  the  disappearance  of  an  active  market  because  the  entity’s  financial 
instruments  are  no  longer  publicly  traded  is  not  evidence  of  impairment.  A  downgrade  of  an 
entity’s  credit  rating  is  not,  in  itself,  evidence  of  impairment,  although  it  may  be  evidence  of 
impairment  when  considered  with  other  available  information.  A  decline  in  the  fair  value  of  a 
financial asset below its cost or amortised cost is not necessarily evidence of impairment.  

If  in  a  subsequent  period,  the  fair  value  of  a  debt  instrument  classified  as  Available  for  Sale 
increases and the increase can be objectively related to an event occurring after the impairment 
loss  was  recognised  in  the  statement  of  financial  performance,  the  impairment  loss  shall  be 
reversed, with the amount of the reversal recognised in the statement of financial performance. 

(c) 

Fair value of financial instruments 

Fair  value  is  the  amount  for  which  an  asset  could  be  exchanged,  or  a  liability  settled,  between 
knowledgeable, willing parties in an arm’s length transaction. 

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

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

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

-  Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities; 
-  Level 2: Inputs other than quoted prices included within Level 1 that are observable for 
the asset or liability, either directly (i.e., as price) or indirectly (i.e., derived from prices); 
-  Level  3:  Inputs  for  the  asset  or  liability  that  are  not  based  on  observable  market  data 

(unobservable 
inputs). 

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

24 

 
 
 
(d) 

Impairment of financial assets 

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

For the Available for Sale financial assets, an objective evidence would include a significant or 
prolonged decline in the fair value of the investment below its cost. Where there is evidence of 
impairment, the cumulative loss (measured as the difference between the acquisition cost net of 
any principal repayment and amortisation and the current fair value, less any impairment loss on 
that investment previously recognised in the statement of financial performance) is removed from 
net  assets  and  recognised  in  the  statement  of  financial  performance.  Impairment  losses  on 
Available for Sale financial assets are reversed through the statement of financial performance. 

3.2.4.3.  Contributions 

Contributions are increased by: 

-  Payment allocations made to the Fund by the general budget of the European Union; 
-  Guarantee recoveries received from EIB. 

Contributions are decreased by: 

-  Payment  allocations  to  be  made  from  the  Fund  to  the  general  budget  of  the  European 

Union; 

-  Guarantee calls made by the EIB.  

Contributions to be received5 from the general budget of the European Union, or to be paid back 
to the general budget of the European Union are recognized in the balance sheet on the date when 
they  become  due  or  owed  according  to  articles  3,  4,  5  and  6  of  the  Council  Regulation  (EC, 
Euratom)  No  480/2009  of  25 May 2009  establishing  a  Guarantee  Fund  for  external  actions 
(codified  version).  When  it  relates  to  articles  5  and  6  the  contributions  to  be  paid  or  received, 
based on the year end n-1 difference between the target amount and the value of the Fund’s net 
assets,  are  calculated  and  recorded  at  the  beginning  of  the  year  n.  When  article  4  applies,  the 
contribution  to  be  paid  back  is  calculated  and  recorded  at  the  date  of  accession  of  the  new 
Member State to the European Union. 

Contributions  to  be  paid  to  the  EIB  in  the  context  of  guarantee  calls  in  line  with  the  Recovery 
Agreement between the European Union and the EIB signed on 25 July 2014 in respect of loans 

5 

The  interinstitutional  Agreement  between  the  European  Parliament,  the  Council  and  the  Commission  on  budgetary  discipline  and  sound 
financial management adopted on 25 November 2013 sets the multiannual financial framework of the European Union for the period 2014 to 
2020. 

25 

 
 
 
 
                                                 
loan  guarantees  granted  by 

the  European  Union 
and 
(“Recovery Agreement”) are derecognised from the balance sheet on the date when the guarantee 
call becomes due. 

the  EIB  for  projects  outside 

Guarantee  recoveries  paid  from  the  EIB  to  the  Fund  in  line  with  the  Recovery  Agreement  are 
recognised  in  the  balance  sheet  as  contributions  on  the  date  when  the  guarantee  recovery 
becomes due. 

3.2.4.4.  Interest income 

Interest income covers interest earned on cash and cash equivalents and the Bond portfolio and is 
recorded in the statement of financial performance on an accrual basis. 

3.2.4.5.  Interest expense 

Interest expense covers interest paid on cash and cash equivalents, due to negative interest rate, 
and is recorded in the statement of financial performance on an accrual basis. 

3.2.4.6.  Treasury management fees 

According to the Convention, EIB shall receive a treasury management fee which is calculated on 
the basis of, in the case of securities, the average market value at the end of each month, and in 
the case of cash and money market deposits, the average nominal value at the end of each month. 

Treasury management fees are recorded in the statement of financial performance on an accrual 
basis. 

3.2.4.7.  Securities Lending Activity 

In April 2008 the Fund entered into an automatic securities lending program with Euroclear Bank 
SA/NV to lend assets from its Bond portfolio. Within this securities lending program all bonds 
from the Bond portfolio are eligible to be lent out. 

Securities  lent  within  the  automatic  securities  lending  program  are  not  derecognized  from  the 
Fund’s balance sheet as the control of the contractual rights that comprises these securities is still 
held by the Fund itself. 

Income from securities lending activity is recorded in the statement of financial performance on 
an accrual basis. 

3.2.5.  Taxation 

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

26 

 
 
 
 
 
 
3.3. 

Financial Risk Management 

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

-  credit  risk  –  the  risk  of  loss  resulting  from  client  or  counterparty  default  and  arising  on 

credit exposure in all forms, including settlement risk; 

- 

liquidity  risk  –  the  risk  that  an  entity  will  encounter  difficulty  in  meeting  obligations 
associated with financial liabilities that are settled by delivering cash or another financial 
asset; 

-  market risk – exposure to observable market variables such as interest rates and foreign 

exchange rates. 

3.3.1.  Risk management organisation 

The Risk Management function of EIB ensures that the treasury portfolio is managed in line with 
the  agreed  asset  management  guidelines,  especially  in  respect  of  the  eligible  investments,  the 
maximum  maturity,  the  interest  rate  risk  and  the  credit  risk  exposure  of  the  Fund’s  treasury 
portfolio. In this respect quarterly reporting is also delivered to the EC concerning the risk and 
the performance of the Fund’s treasury portfolio. The reporting makes reference to breaches, if 
any,  of  the  limits  set  out  in  the  asset  management  guidelines  and  includes  a  comparison  of  the 
valuations of the portfolio to a performance index taken as benchmark.  

3.3.2.  Credit Risk 

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

3.3.2.1.  Credit risk policy 

The  treasury  portfolio’s  agreed  asset  management  guidelines  and/or  investment  strategy  define 
certain limits and restrictions in order to limit the exposure to credit risk of the treasury portfolio. 
The compliance with these limits is monitored by the Risk Management on a daily basis. Such 
limits  and  restrictions  include  eligibility  criteria,  absolute  credit  limits  in  nominal  terms 
depending  on  issuer  category,  relative  concentration  limits  depending  on  issuer  category  and 
concentration limits per issue. 

27 

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

credit enhancements 

The  following  table  shows  the  maximum  exposure  to  credit  risk  for  the  components  of  the 
balance sheet (in EUR): 

Maximum exposure  
ASSETS 
Available for Sale portfolio 
Contributions receivable 
Cash and cash equivalents 
Total assets 

31.12.2016 

31.12.2015

2,068,651,104.70 
240,540,250.00 
196,861,698.44 
2,506,053,053.14 

2,002,026,056.34
257,121,792.00
93,943,261.80 * 

2,353,091,110.14

2,353,091,110.14

Total credit exposure 
* out of which EUR 10,000,000.00 is related to short-term deposits under settlement. 

2,506,053,053.14 

3.3.2.3.  Credit risk on cash and cash equivalents 

(a) 

Analysis of current accounts per profile of counterparties 

The following table shows the breakdown of current account balances per maximum long-term 
counterparty rating (based on the external long term ratings assigned by Fitch, Standard & Poor’s 
and Moody’s) (in EUR): 

Rating 

A1 

Aa1 

Total 

31.12.2016

45,424,684.55

6,818.95

31.12.2015 

49,123,538.63 

22,024.36 

45,431,503.50

49,145,562.99 

All  counterparties  are  maximum  rated  P-1  short-term  (based  on  the  external  short  term  ratings 
assigned by Fitch, Standard & Poor’s and Moody’s). 

The  Fund  has  two  current  accounts  opened  with  BNP  Paribas  Fortis  and  one  current  account 
opened with Euroclear Bank as follows (in EUR): 

Current accounts 
BNP Paribas Fortis transitory account 

BNP Paribas Fortis current account 

Euroclear Bank current account 

Total 

31.12.2016
32,777.03

31.12.2015 
33,884.70 

45,391,907.52

49,089,653.93 

6,818.95

22,024.36 

45,431,503.50

49,145,562.99 

28 

 
 
 
 
 
 
 
 
 
 
 
 
(b) 

Analysis of short term deposits per profile of counterparties 

In  accordance  with  the  agreement  between  the  European  Commission  and  the  EIB  on  the 
management  of  the  Fund,  all  interbank  investments  should  have  a  minimum  issuer  short-term 
rating  from  Moody’s  or  equivalent  of P-1.  The  following  table  shows  the  breakdown  of  short 
term deposits (excluding short-term  deposits under settlement) per maximum counterparty long 
term  rating  (based  on  the  external  long  term  ratings  assigned  by  Fitch,  Standard  &  Poor’s  and 
Moody’s), the amounts presented include accrued interest (in EUR): 

Rating 
Aa2 
A1 
A2 
Aa3 
Total 
* out of which EUR 10,000,000.00 is related to short-term deposits under settlement. 

31.12.2016
54,771,262.27
22,382,826.67
74,276,106.00
0.00
151,430,194.94

36.17%
14.78%
49.05%
0.00%
100.00%

31.12.2015
4,599,616.67

0.00  
10,699,861.36 *
29,498,220.78
44,797,698.81

10.27%
0.00%
23.88%
65.85%
100.00%

3.3.2.4.  Credit risk on Bond portfolio 

(a) 

Risk concentration per issuance Credit risk on Bond portfolio 

All the securities held in the portfolio are in line with the management guidelines and meet the 
following criteria for: 

-  Securities issued or guaranteed by Member States: minimum rating Baa3;  
-  Securities issued by a Supranational, other States or Public Company: minimum rating 

Aa2;  

-  Covered Bonds or other legal bodies (including structured products): minimum rating 

Aaa; 

-  Securities issued by Banks and Corporates:  minimum rating Aa2.  

The following table shows the breakdown of the Bond portfolio, at market value excluding 
accrued interest, per security type and rating (in EUR): 

Issuer - Rating 

Banks Aa1 
Banks Aa2 
Banks Aa3 
Banks A1 
Banks A2 
Member State Aaa 
Member State Aa1 
Member State Aa2 
Member State Aa3 
Member State A1 
Member State A2 
Member State A3 

31.12.2015

0.00
60,018,950.00
20,504,766.41
25,196,381.01
12,899,988.56
136,777,774.50
0.00
126,727,098.85
11,008,800.00
91,597,718.50
65,179,156.00
37,114,380.00

0.00%
3.02%
1.03%
1.27%
0.65%
6.88%
0.00%
6.38%
0.55%
4.61%
3.28%
1.87%

1.24%
5.25%
0.49%
0.00%
0.00%
1.81%
2.08%
6.91%
1.12%
4.04%
6.72%
0.69%

31.12.2016

25,488,370.00
107,722,271.70
10,000,224.54
0.00
0.00
37,469,081.50
42,684,937.50
141,949,442.00
23,067,766.00
82,865,400.00
137,947,264.70
14,196,000.00

29 

 
 
 
 
 
Member State Ba1 
Member State Baa1 
Member State Baa3 
Covered Bonds Aaa 
Corporates Aaa 
Corporates Aa1 
Corporates Aa2 
Public Institution Aaa 
Public Institution Aa1 
Public Institution Aa2 
Supranational Aaa 
Supranational Aa1 
Non-EU Public Institution Aaa 
Non-EU Public Institution Aa2 

Total 

0.00
101,889,400.20
10,990,025.00
547,963,464.77
47,135,337.90
25,944,010.02
166,870,276.95
289,509,565.62
54,812,301.06
116,941,116.50
5,009,300.00
53,165,821.50
4,103,365.60
5,535,650.00

0.00%
4.96%
0.54%
26.69%
2.30%
1.26%
8.13%
14.10%
2.67%
5.70%
0.24%
2.59%
0.20%
0.27%

16,519,200.00
68,076,178.64
0.00
589,361,477.88
0.00
113,062,955.15
72,737,601.19
237,206,683.00
27,587,948.20
223,558,927.85
5,035,408.00
37,421,371.00
4,115,106.80
5,357,750.00

0.83%
3.43%
0.00%
29.66%
0.00%
5.69%
3.66%
11.94%
1.39%
11.25%
0.25%
1.88%
0.21%
0.27%

2,053,260,393.06

100.00%

1,987,065,621.54

100.00%

The  above  table  presenting  securities  ratings  is  prepared  according  to  the  agreed  asset 
management  guidelines.  In  particular,  security  ratings  of  the  Bond  portfolio  refer  to  the  best 
rating given by Moody’s, Standard & Poor’s or Fitch. 
In case of securities for which no security rating is available the rating of the issuer (or guarantor 
for guaranteed positions) has been taken into account. 

(b) 

EU sovereign exposure 

The  following  tables  show  the  portfolio  structure  by  exposure  towards  EU  sovereign  (either 
directly or indirectly) and exposure towards other entities as at 31 December 2016 and as at 31 
December 2015 (in EUR): 

At 31.12.2016 

EU sovereigns 
Austria 
Belgium 
Finland 
France 
Germany 
Hungary 
Ireland 
Italy 
Latvia 
Luxembourg 
Netherlands 
Poland 

Purchase price Value at maturity  Carrying Value*)

11,420,950.00
21,957,400.00
29,445,625.00
138,439,640.00
15,552,150.00
11,006,900.00
78,532,800.00
54,493,000.00
13,978,020.00
14,946,600.00
4,500,000.00
139,001,000.00

11,500,000.00 
20,000,000.00 
29,500,000.00 
137,000,000.00 
15,000,000.00 
10,000,000.00 
65,000,000.00 
50,000,000.00 
14,000,000.00 
15,000,000.00 
4,500,000.00 
125,000,000.00 

12,195,972.50
23,067,766.00
30,488,965.00
141,949,442.00
15,777,238.00
10,990,025.00
77,787,050.00
53,851,795.00
14,196,000.00
17,189,458.50
4,502,385.00
136,826,408.00

30 

 
 
 
 
 
 
 
Slovakia 
Slovenia 
Spain 
EU Supranational 

Total EU sovereigns 
Total EU sovereigns 

TOTAL 

4,927,650.00
1,122,000.00
48,079,264.91
15,764,050.00

5,000,000.00 
1,000,000.00 
42,000,000.00 
15,000,000.00 

5,078,350.00
1,120,856.70
48,037,605.20
16,327,653.50

603,167,049.91
1,429,707,702.96

559,500,000.00 
1,385,250,000.00 

609,386,970.40
1,443,873,422.66

2,032,874,752.87

1,944,750,000.00 

2,053,260,393.06

*) The carrying value represents the clean market value of the assets excluding accrued interest. 

31 

 
 
 
 
 
At 31.12.2015 

EU sovereigns 
Austria 
Belgium 
Czech Republic 
Finland 
France 
Germany 
Ireland 
Italy 
Latvia 
Lithuania 
Luxembourg 
Netherlands 
Poland 
Portugal 
Slovakia 
Slovenia 
Spain 
Sweden 
EU Supranational 

Total EU sovereigns 

Others 

TOTAL 

Purchase price Value at maturity  Carrying Value*)

11,420,950.00
32,115,400.00
11,042,900.00
29,445,625.00
92,849,815.00
50,090,150.00
67,492,000.00
45,171,585.00
13,978,020.00
12,460,600.00
14,946,600.00
4,500,000.00
64,903,000.00
16,032,480.00
24,688,950.00
10,000,000.00
20,003,715.44
19,920,000.00
35,794,950.00

11,500,000.00 
30,000,000.00 
11,000,000.00 
29,500,000.00 
92,000,000.00 
50,000,000.00 
55,000,000.00 
46,500,000.00 
14,000,000.00 
13,000,000.00 
15,000,000.00 
4,500,000.00 
60,000,000.00 
16,000,000.00 
25,000,000.00 
10,000,000.00 
20,000,000.00 
20,000,000.00 
35,000,000.00 

11,916,827.00
32,506,600.00
11,008,800.00
29,766,005.00
94,220,498.85
53,591,183.00
66,266,018.50
48,070,658.80
14,032,060.00
13,047,320.00
16,985,344.50
4,506,615.00
65,179,156.00
16,519,200.00
25,331,700.00
10,035,000.00
20,005,519.84
20,011,800.00
37,421,371.00

576,856,740.44

558,000,000.00 

590,421,677.49

1,382,115,989.22

1,352,158,731.40 

1,396,643,944.05

1,958,972,729.66

1,910,158,731.40 

1,987,065,621.54

*) The carrying value represents the clean market value of the assets excluding accrued interest. 

In the tables above “EU sovereigns” refer to bonds issued or guaranteed by EU Member States 
and  EU Supranationals  while  “others”  refer  to  bonds  issued  by  banks,  covered  bonds,  bonds 
issued or guaranteed by non EU Supranationals or EU and non EU Public Institutions. 

3.3.3.  Liquidity Risk 

Liquidity  risk  refers  to  an  entity’s  ability  to  meet  obligations  as  they  become  due,  without 
incurring unacceptable losses. It can be split into funding liquidity risk and market liquidity risk. 
Funding liquidity risk is the risk that an entity will not be able to meet efficiently both expected 
and  unexpected  current  and  future  cash  flow  needs  without  affecting  its  daily  operations  or  its 
financial condition. Market liquidity risk is the risk that an entity cannot easily offset or eliminate 
a position at the market price because of inadequate market depth or market disruption. 

3.3.3.1.  Liquidity risk management 

The  treasury  portfolio’s  agreed  asset  management  guidelines  and/or  investment  strategy  define 
certain  limits  and  restrictions  in  order  to  limit  the  exposure  to  funding  liquidity  risk  of  the 

32 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
treasury portfolio. The compliance with these limits is monitored by Risk Management on a daily 
basis. Such limits and restrictions include a target liquidity buffer. 

3.3.3.2.  Liquidity risk measurement 

The  table  below  provides  an  analysis  of  the  non-derivative  liabilities  into  relevant  maturity 
groupings based on the remaining contractual maturities. The table is presented under the most 
prudent consideration of maturity dates where the earliest possible repayment date is shown. 

Maturity profile 
(at 31 December 2016) 
Other payables 

Total  

Maturity profile 
(at 31 December 2015) 
Guarantee call payable 
Other payables 

Total  

3.3.4.  Market Risk 

Less than
 1 year
931,475.15

931,475.15

1 year to
  5 years
0.00

0.00

More than
 5 years
0.00

0.00

TOTAL

931,475.15

931,475.15

Less than
1 year
22,130,631.78
900,727.98

23,031,359.76

1 year to 
5 years
0.00
0.00

0.00

More than
 5 years
0.00
0.00

TOTAL

22,130,631.78
900,727.98

0.00

23,031,359.76

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

The  treasury  portfolio’s  agreed  asset  management  guidelines  and/or  investment  strategy  define 
certain restrictions (such as concentration limits,  modified  duration  and  target combined  spread 
duration) in order to fulfil diversification and to control to market risk of the treasury portfolio. 
The compliance with these limits is monitored by Risk Management on a daily basis.  

3.3.4.1.  Interest rate risk position 

Interest rate risk arises from the volatility in the economic value of, or in the income derived from 
the treasury portfolio’s interest rate bearing positions due to adverse movements in interest rates. 
Exposure  to  interest  rate  risk  occurs  when  there  are  differences  in  repricing  and  maturity 
characteristics of the different assets and liabilities. 

Interest rate sensitivity analysis  
The interest rate sensitivity of the treasury portfolios represents the amount of a potential change 
in the fair value of the portfolio and is computed on a deal by deal basis assuming that all interest 
rate curves rose by one percentage basis and 100 basis points or decrease by one percentage basis 
point and 100 basis points. 

33 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The following table shows the sensitivity to interest rate variations of the three Guarantee Fund 
(“GF”) treasury sub-portfolios GF-Short term (Short term deposits, commercial papers and zero 
coupon bonds), GF-FRN  (Bond portfolio variable interest), GF-Long term (Bond portfolio fixed 
interest). It is presented on the same basis as the quarterly risk management reporting delivered to 
the EC concerning the risk and the performance of the Fund’s portfolio. 

31 December 2016 

GF sub-portfolios 

GF - Short term 
GF - FRN 
GF - Long term 
Current accounts 

TOTAL GF 

31 December 2015 

GF sub-portfolios 

GF - Short term 
GF - FRN 
GF - Long term 
Current accounts 

TOTAL GF 

Clean market 
value  
in EUR'000 

Modified 
Duration 
(Years) 

IR Exposure 
(+/-1bp)  
in EUR'000 

IR Exposure 
(100bp)  
in EUR'000 

IR Exposure 
(-100bp)  
in EUR'000 

181,508 
155,579 
1,867,673 
45,432 

2,250,192 

0.09 
0.17 
4.30 
0.00 

3.59 

-/+ 2 
-/+ 3 
-/+ 810 
-/+ 0 

-/+ 815 

-155  
-260  
-78,598  
0 

-79,013 

+ 157 
+ 264 
+ 83,468 
0 

+ 83,889 

Clean market 
value  
in EUR'000 

Modified 
Duration 
(Years) 

IR Exposure 
(+/-1bp)  
in EUR'000 

IR Exposure 
(100bp)  
in EUR'000 

IR Exposure 
(-100bp)  
in EUR'000 

113,412 
236,045 
1,672,414 
49,146 

2,071,017 

0.17 
0.17 
3.94 
0.00 

3.21 

-/+ 2 
-/+ 4 
-/+ 665 
-/+ 0 

-/+ 671 

-191 
-398 
-64,524 
0 

-65,113 

+ 193 
+ 401 
+ 68,473 
0 

+ 69,067 

The clean market value of the GF-Short term sub-portfolio as reported above represents the sum 
of  clean  market  values  calculated  for  short  term  deposits,  commercial  papers  and  zero  coupon 
bonds. Those clean market values are determined as follows: 

•  Short-term deposits: the sum of the nominal value and total interest at maturity for each 
position is discounted from the maturity date to the spot date, whereas the spot date equals 
the  valuation  date  plus  two  business  days.  Finally,  accrued  interest  at  spot  date  is 
subtracted from the calculated market value of the position. 

•  Commercial papers: the nominal value of each position is discounted from the maturity 
date  to  the  spot  date,  whereas  the  spot  date  equals  the  valuation  date  plus  two  business 
days; 

•  Zero coupon bonds: the nominal value of each position is multiplied with the observed 

spot/quote/price. 

The  clean  market  values  of  the  GF-FRN  and  GF-Long  term  sub-portfolios  as  reported  above 
represents the sum of the clean market values calculated for fixed and floating rate bonds. Those 
clean market values are determined as follows: 

•  Fixed rate bonds: the nominal value of each position is multiplied by its market quote as 

observed at valuation date. 

34 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
•  Floating  rate  bonds  (FRNs):  the  nominal  value  of  each  position  is  multiplied  by  its 

market quote as observed at valuation date. 

3.3.5.  Foreign exchange risk exposure 

Foreign exchange risk is the volatility in the economic value of, or in the income derived from, 
the Fund’s positions due to adverse movements of foreign exchange rates. 

As  all  assets  and  liabilities  of  the  Fund  are  denominated  in  Euro,  the  Fund  is  not  exposed  to 
foreign exchange risk. 

35 

 
 
3.4. 

Fair value of financial instruments 

3.4.1.  Accounting classifications and fair value 

The following tables show the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value 
hierarchy. These do not include fair value information for financial assets and financial liabilities not carried at fair value if the carrying amount is a 
reasonable approximation of fair value. 

At 31 December 2016 

in EUR 

Financial assets carried at fair value: 

Bond portfolio 

Total  

Financial assets not carried at fair value: 

Contributions receivable 

Current accounts 

Short-term deposits 

Total  

Total financial assets 

Financial liabilities not carried at fair value: 

Other payables 

Total  

Total financial liabilities 

Carrying amount 

Fair value 

Available for 
Sale

Cash, loans and 
receivables

Other financial 
liabilities

Total 

Level 1

Level 2

Level 3

Total 

2,068,651,104.70

2,068,651,104.70

0.00

0.00

0.00 2,068,651,104.70 

  2,058,650,880.16

10,000,224.54

0.00 2,068,651,104.70 

0.00 2,068,651,104.70 

  2,058,650,880.16

10,000,224.54

0.00 2,068,651,104.70 

0.00

0.00

0.00

240,540,250.00

45,431,503.50

151,430,194.94

0.00

0.00

0.00

240,540,250.00 

45,431,503.50 

151,430,194.94 

0.00

437,401,948.44

0.00

437,401,948.44 

2,068,651,104.70

437,401,948.44

0.00 2,506,053,053.14 

0.00

0.00

0.00

0.00

0.00

0.00

-931,475.15 

-931,475.15 

-931,475.15 

-931,475.15 

-931,475.15 

-931,475.15 

36 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
At 31 December 2015 

in EUR 

Financial assets carried at fair value: 

Bond portfolio 

Total  

Financial assets not carried at fair value: 

Contributions receivable 

Current accounts 

Short-term deposits (including amounts under 
settlement) 

Carrying amount 

Fair value 

Available for 
Sale

Cash, loans and 
receivables

Other financial 
liabilities

Total 

Level 1

Level 2

Level 3

Total 

2,002,026,056.34

2,002,026,056.34

0.00

0.00

0.00 2,002,026,056.34 

  1,923,419,400.52

78,606,655.82

0.00 2,002,026,056.34 

0.00 2,002,026,056.34 

  1,923,419,400.52

78,606,655.82

0.00 2,002,026,056.34 

0.00

0.00

0.00

257,121,792.00

49,145,562.99

34,797,698.81

0.00

0.00

0.00

257,121,792.00 

49,145,562.99 

34,797,698.81 

Total  

0.00

341,065,053.80

0.00

341,065,053.80 

Total financial assets 

2,002,026,056.34

341,065,053.80

0.00 2,343,091,110.14 

Financial liabilities not carried at fair value: 

Other payables 

Guarantee call payable 

Total  

Total financial liabilities 

0.00

0.00

0.00

0.00

0.00

0.00

0.00

0.00

-900,727.98

-900,727.98 

-22,130,631.78

-22,130,631.78 

-23,031,359.76

-23,031,359.76 

-23,031,359.76

-23,031,359.76 

37 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
3.4.2.  Measurement of fair values 

Assets for which carrying value approximates fair value 

For financial assets and financial liabilities that are liquid or have a short term maturity (less than three 
months), it is assumed that the carrying amount approximates their fair value. 

Assets and liabilities carried at fair value 

Published price quotations in an active market are the first source for determining the fair value of a 
financial instrument.  

For instruments without available market price, the fair value is estimated using a discounted cash flow 
model  based  on  either  directly  or  indirectly  observable  market  data  (discount  curves  and  estimation 
curves) prevailing at the balance sheet date. 

3.4.3.  Transfers between level 1 and level 2  

The table below shows the significant transfers between level 1 and level 2 of the fair value hierarchy 
(in EUR): 

Transfer out of level 2 into level 1 

0.00 

10,025,427.78

31 December 2016 

31 December 2015

The  transfers  out  of  level  2  into  level  1  correspond  to  securities  for  which  quoted  prices  in  active 
markets were available at the balance sheet date but not at the previous balance sheet date. 

3.4.4.  Level 3 fair value 

As at 31 December 2016 and 31 December 2015 the Fund has no financial instruments classified under 
Level 3. 

3.5. 

Bond portfolio 

The following tables show the movements of the Bond portfolio (in EUR): 

Balance as at 1 January 2015 
Acquisitions 
Disposals and withdrawals (original acquisition cost) 
Change in carrying amount -  actuarial difference 
Change in accrued interest 
Change in fair value 
Balance as amount at 31 December 2015 

Balance as at 1 January 2016 
Acquisitions 
Disposals and withdrawals (original acquisition cost) 
Change in carrying amount -  actuarial difference 
Change in accrued interest 
Change in fair value 
Balance as at 31 December 2016 

38 

1,845,410,324.55 
1,054,379,125.37 
-867,801,622.66 
-6,314,190.15 
330,886.89 
-23,978,467.66 
2,002,026,056.34 

2,002,026,056.34 
991,735,364.00 
-917,833,340.79 
-11,077,510.38 
430,276.84 
3,370,258.69 
2,068,651,104.70 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
As  at  31  December  2016  the  nominal  value  of  the  investment  portfolio  was  EUR  1,944.8  million 
(2015:  EUR 1,910.2  million),  against  a  market  value  of  EUR  2,053.3  million  (2015:  EUR  1,987.1 
million), excluding accrued interest. 

Accrued 
EUR 14,960,434.80) is split between: 

interest  as  at  31  December  2016  amounting 

to  EUR  15,390,711.64 

(2015: 

Fixed rate notes 

 EUR 15,380,367.47 (2015: EUR 14,800,690.14); 

Floating rate notes EUR 10,344.17 (2015: EUR 159,744.66). 

As  at  31  December  2016  the  market  value  of  securities  lent  within  the  automatic  security  lending 
agreement  with  Euroclear  (excluding  accrued  interest)  amounts  to  EUR  48,203,121.55  (2015:  EUR 
20,595,850.15). 

3.6. 

Cash and cash equivalents 

The following table shows the split of cash and cash equivalents (including accrued interest) (in EUR): 

Description 

Current accounts 
Short-term deposits (including deposits under settlement) 
of which accrued interest 
Total 

3.7. 

Contributions 

31.12.2016 

31.12.2015

45,431,503.50 
151,430,194.94 
-69,805.06 
196,861,698.44 

49,145,562.99
34,797,698.81
-2,301.19
83,943,261.80

Contributions are increased by contributions from the general budget of the European Union and by the 
recoveries  of  previous  interventions  made  by  the  Fund  with  regard  to  defaulted  guaranteed  loans. 
Contributions are either decreased by repayments to the general budget of the European Union or by 
interventions the Fund is paying with regard to defaulted guaranteed loans. Contributions to/from the 
budget of the European Union are recognised in the balance sheet on the date when they become due or 
owed according to articles 3, 4, 5 and 6 of the Council Regulation (EC, Euratom) No 480/2009 of 25 
May 2009 establishing a Guarantee Fund for external actions. 

The  contribution  allocated  but  not  yet  paid  in  as  at  31  December  2015  amounting  to  EUR 
257,121,792.00 was paid in cash during the reporting period. In 2016, the Fund has been allocated an 
additional  contribution  amount  of  EUR  240,540,250.00  which  has  not  been  paid  as  at  31  December 
2016.  

The following table shows the movements of the contributions during the reporting period (in EUR):  

Balance as at 1 January 2015 
Contributions from the European Commission allocated but not paid in 
Change of  contributions payable as guarantee call 
Contributions paid to the EIB as guarantee call 
Balance as at 31 December 2015 

Balance as at 1 January 2016 
Contributions from the European Commission allocated but not paid in 
Change of  contributions payable as guarantee call 
Contributions paid to the EIB as guarantee call 
Balance as at 31 December 2016 

39 

1,150,514,734.55
257,121,792.00
69,834.28
-60,164,571.55
1,347,541,789.28

1,347,541,789.28
240,540,250.00
22,130,631.78
-110,828,866.39
1,499,383,804.67

 
 
 
 
 
 
 
 
 
 
 
 
3.8. 

Other payables (in EUR) 

Description 
Treasury management fees 
Audit fees 
Total 

31.12.2016 
891,975.15 
39,500.00 
931,475.15 

31.12.2015
861,227.98
39,500.00
900,727.98

Treasury management fees are payable to the EIB on an annual basis.  

3.9. 

Subsequent events 

There have been no material post-balance sheet events, which would require disclosure or adjustment 
to the 31 December 2016 financial statements. 

40