REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on guarantees covered by the general budget Situation at 31 December 2017
Date: 2018-09-05
Institutions: Directorate-General for Economic and Financial Affairs, European Commission
Subjects: EIB loan, EU Member State, Euratom loan, budgetary reserve (EU), credit guarantee, economic stabilisation, financial aid, general budget (EU), macroeconomics, third country

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 5.9.2018  COM(2018) 609 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on guarantees covered by the general budget  Situation at 31 December 2017 {SWD(2018) 397 final}  
 
 
Table of Contents 

1. 

2. 

3. 

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

Operations guaranteed by the EU budget and crisis mechanisms of the euro-area not 
covered by the EU budget ............................................................................................ 3 

Evolutions of guaranteed operations ............................................................................ 7 

3.1. 

Operations managed directly by the Commission ....................................................... 7 

3.1.1.  European Financial Stabilisation Mechanism (EFSM) ................................................ 9 

3.1.2.  Balance of Payments facility (BOP) .......................................................................... 10 

3.1.3.  Macro-Financial Assistance loans (MFA) ................................................................. 10 

3.1.4.  Euratom loans............................................................................................................. 12 

3.2. 

Evolution of the EIB external financing operations ................................................... 13 

4. 

4.1. 

4.2. 

4.3. 

Risks covered by the EU budget ................................................................................ 13 

Definition of risk ........................................................................................................ 13 

Total risk composition................................................................................................ 14 

Annual risk covered by the EU budget ...................................................................... 14 

4.3.1.  Member State exposure .............................................................................................. 14 

4.3.2.  Third country exposure .............................................................................................. 15 

5. 

5.1. 

Activation and payment of guarantees ....................................................................... 16 

Debt service not covered by the Guarantee Fund for External Action (Euratom loans 
to Member States, EFSM and BoP) ........................................................................... 16 

5.1.1.  Payments from cash resources ................................................................................... 16 

5.1.2.  Payments from the EU budget ................................................................................... 17 

5.2 

Calls on the Guarantee Fund for External Actions and recoveries (ELM, MFA and 
Euratom loans to Third countries) .............................................................................. 17 

5.3. 

Evolution of the Fund................................................................................................. 19 

6. 

The European Fund for Strategic Investments (EFSI) ............................................... 20 

1 

 
 
 
 
 
1. 

INTRODUCTION 

The  objective  of  this  report  is  to  monitor  the  credit  risks  borne  by  the  EU  budget  resulting 
from  the  guarantees  given  for  lending  operations  implemented  directly  by  the  European 
Union  or  indirectly  through  the  guarantee  granted  for  EIB  financing  projects  outside  the 
Union. 

This report is submitted pursuant to Article 149 of the Financial Regulation1 which requires 
the  Commission  to  report  annually  to  the  European  Parliament  and  to  the  Council  on  EU 
budget guarantees and the corresponding risks. 

The  report  is  structured  as  follows:  Section  2  recalls  the  key  features  of  the  operations 
guaranteed by the EU budget; several other additional crisis management mechanisms, which 
do not imply any risk for the EU budget, are also presented. Section 3 lays out the evolution 
of the guaranteed operations. Section 4 highlights the main risks covered by the EU budget. 
Section 5 outlines the activation of the guarantees and the evolution of the Guarantee Fund for 
external actions ("the Fund")2 while section 6 outlines the evolution of the European Fund for 
Strategic Investments (EFSI)3. 

A  Commission  Staff  Working  Document  (SWD)  complements  this  report  with  a  set  of 
detailed  tables  and  explanatory  notes.  It  also  provides  a  macroeconomic  analysis  of  the 
countries benefitting from EU loans and/or guarantees, representing the bulk of the exposure 
of the Fund. 

2. 

OPERATIONS  GUARANTEED  BY  THE  EU  BUDGET  AND  CRISIS  MECHANISMS  OF  THE 
EURO-AREA NOT COVERED BY THE EU BUDGET  

The risks covered by the EU budget derive from a variety of lending and guarantee operations 
which can be divided into four categories:  

2.1 Loans granted by the European Union with macroeconomic objectives  

Such  loans  comprise  (1)  Macro-Financial  Assistance4  ("MFA")  loans  to  third  countries,  (2) 
Balance-of-Payments5  ("BOP") 
to  non-euro  Member  States 
loans  granting  support 
experiencing  balance-of-payments  difficulties  and  (3)  loans  under  the  European  Financial 

1 

2 

3 

4 

5 

Regulation  (EU,  Euratom)  No  966/2012  of  the  European  Parliament  and  of  the  Council  of  25  October 
2012 on the financial rules applicable to the general budget of the Union and repealing Council Regulation 
(EC, Euratom) No 1605/2002 (OJ L 298, 26.10.2012, p. 1). 
Council  Regulation  (EC,  Euratom)  No  480/2009  of  25 May 2009  establishing  a  Guarantee  Fund  for 
external actions (codified version), the "Guarantee Fund Regulation" (OJ L 145, 10.6.2009, p.10). 
Regulation  (EU)  2015/1017  of  the  European  Parliament  and  of  the  Council  of  25  June  2015  on  the 
European  Fund  for  Strategic  Investments,  the  European  Investment  Advisory  Hub  and  the  European 
Investment Project Portal and amending Regulations (EU) No 1291/2013 and (EU) No 1316/2013 — the 
European Fund for Strategic Investments  (the "EFSI Regulation"). OJ L 169, 1.7.2015, p. 1. 
MFA may also take the form of grants to third countries (not covered by this report). References to legal 
bases are listed in the Annex of Table A2B of the SWD. 
Council Regulation (EC) N° 332/2002 of 18 February 2002 establishing a facility providing medium-term 
financial assistance for Member States' balances of payments (OJ L 53, 23.2.2002, p.1). 

2 

 
                                                 
Stabilisation  Mechanism  ("EFSM")6  granting  support  to  all  Member  States  experiencing  or 
seriously  threatened  with  a  severe  economic  financial  disturbance  caused  by  exceptional 
occurrences beyond their control. They are activated in conjunction with financial support by 
the International Monetary Fund (IMF); 

2.2 Loans with microeconomic objectives  

This heading refers to Euratom loans7. The Euratom loan facility may be used: 

[in  Member  States]:  investments  in  nuclear  power  stations  and  in  industrial 

 • 
installations in the nuclear fuel cycle 8 and  

[in certain non-member countries]: investments to improve the safety and efficiency 
• 
of  nuclear  power  stations  that  exist  or  are  under  construction,  as  well  as  decommissioning 
projects9. 

2.3 European Investment Bank ("EIB") financing of operations in non-Member States 
("EIB external financing") covered by EU guarantees10 (ELM). 

Under  the  External  Lending  Mandate  (ELM),  the  EU  provides  a  guarantee  from  the  EU 
budget to enable the EIB to increase its lending outside the EU in support of EU policies. The 
ELM  supports  EIB  activity  in  the  pre-accession  countries,  the  Eastern  and  Southern 
Neighbourhood, Asia, Latin America and South Africa. Under the current ELM period (2014-
2020),  the  EU  budget  guarantees  up  to  EUR  32.3  billion  of  EIB  operations.  On  14  March 
2018,  the  European  Parliament  and  the  Council  adopted  the  Decision  (EU)  2018/412 
amending  Decision  No  466/2014/EU  in  the  context  of  the  mid-term  review  of  the  ELM 
notably  increasing  the  maximum  ceiling  for  the  current  ELM  from  27  billion  to  EUR  32.3 
billion.  This  review  adds  a  new  objective  of  the  long-term  economic  resilience  of  refugees, 
migrants, host and transit communities, and communities of origin as a strategic response to 
addressing root causes of migration. 

The  EU  guarantee  to  the  EIB  covers  risks  of  a  sovereign  and  political  nature  in  connection 
with its financing operations carried out outside the Union in support of the Union's external 
policy objectives. In addition, the EIB finances investment grade operations outside the Union 
at its own risk, as well as activities under specific mandates such as in ACP countries. 

With  a  view  to  supporting  Union  external  action,  and  in  order  to  enable  the  EIB  to  finance 
investments outside the Union without affecting the credit standing of the EIB, the majority of 
its operations outside the Union benefit from an EU budgetary guarantee.  

6 

7 

8 

9 

10 

Council  Regulation  (EU)  No  407/2010  of  11  May  2010  establishing  a  European  financial  stabilisation 
mechanism (OJ L 118, 12.5.2010, p.1).  

Treaty  dated  25  March  1957  establishing  The  European  Atomic  Energy  Community  (Euratom)  as 
amended and supplemented. 

For Member States: Council Decision 77/270/Euratom of 29 March 1977 empowering the Commission to 
issue  Euratom  loans  for  the  purpose  of  contributing  to  the  financing  of  nuclear  power  stations  (Official 
Journal n° L 88 of 6 April 1977, p. 9) as amended and supplemented. 

For certain non-Member States: Council Decision 94/179/Euratom of 21 March 1994 (Official Journal n° 
L 84 of 29 March 1994) as amended and supplemented. 
References to legal bases are listed in the Annex of Table A3 of the SWD. Cf footnote 6. Either all legal 
basis in the annex or all in footnotes. 

3 

 
                                                 
Guarantee Fund for External Actions 

The guaranteed EIB external financing, MFA and Euratom loans to third countries have since 
1994  been  covered  by  the  Guarantee  Fund  for  External  Actions  ("the  Fund"),  while  BOP, 
EFSM and Euratom loans to Member States are directly covered by the EU budget. 

The Fund covers defaults on loans and loan guarantees granted to non-Member States or for 
projects in non-Member States. It was established: 

    to provide a 'liquidity cushion' in order to avoid calling on the EU budget every time 

a default or late payment on a guaranteed loan arises; and 

    to create an instrument of budgetary discipline by laying down a financial framework 
for the development of the EU policy on guarantees for EU and EIB loans to third 
countries11. 

If  third  countries  become  Member  States,  loans  relating  to  such  countries  are  no  longer 
covered  by  the  Fund  and  the  risk  has  to  be  directly  borne  by  the  EU  budget.  The  Fund  is 
provisioned  from  the  EU  budget  and  has  to  be  maintained  at  a  certain  percentage  of  the 
outstanding amount of the loans and loan guarantees covered by the Fund. This percentage, 
known as the target rate, is currently 9%12. If resources of the Fund are not sufficient, the EU 
budget will provide the necessary funds. 

2.4  European  Investment  Bank  ("EIB")  and  European  Investment  Fund  ("EIF") 
financing  of  operations  in  Member  States  covered  by  EU  guarantees  -  The  European 
Fund for Strategic Investments (EFSI) 

The  European  Fund  for  Strategic  Investments  (EFSI)  is  the  core  of  the  investment  plan  for 
Europe, aimed at boosting long-term economic growth and competitiveness in the European 
Union. 

The EU Guarantee covers part of the financing and investment operations signed by the EIB 
under  the  Infrastructure  and  Innovation  Window  ("IIW")  and  by  the  EIF  under  the  SME 
Window ("SMEW") while the  other part is carried out at the own risk of the EIB Group. 

The EIB and the EIF are responsible for assessing and monitoring the risk of the individual 
operations and report back to the Commission and the European Court of Auditors. 

Guarantee Fund of the European Fund for Strategic Investments (EFSI GF)13 

According  to  Article  12  of  the  EFSI  Regulation14,  the  EFSI  GF  shall  constitute  a  liquidity 
cushion  from  which  the  EIB  shall  be  paid  in  the  event  of  a  call  on  the  EU  guarantee.  In 

11 

12 

13 

Although external risks are covered in fine by the EU budget, the Guarantee Fund acts as an instrument to 
protect the EU budget against the risk of payment defaults. For the latest annual report on the Fund and its 
management, see COM(2017) 488 final of 14.09.2017 and its Staff Working Document (SWD(2017) 296 
final  of  14.09.2017).  The  report  for  2017  is  expected  to  be  available  by  June  2018  on  http://eur-
lex.europa.eu/homepage.html . 
For  a  comprehensive  report  on  the  functioning  of  the  Fund  and  the  provisioning  target  rate,  see 
COM(2014) 214 final of 8.4.2014 and its Staff Working Document (2014) 129 final 

For  more  information  on  the  management  of  the  EFSI  Guarantee  Fund,  see  COM(2017)326  final  of 
16.6.2017.  

4 

 
                                                 
accordance with the EFSI Agreement between the EU and the EIB, calls are paid by the EFSI 
GF if their amount is in excess of the funds at the disposal of the EIB on the EFSI Account. 
The EFSI Account, managed by the EIB, has been established for the purposes of collecting 
the  EU  revenues  resulting  from  EFSI  operations  under  the  EU  guarantee  and  recovered 
amounts  and  to  the  extent  of  the  available  balance,  for  the  payment  of  calls  under  the  EU 
guarantee.  

The EFSI GF is provisioned progressively taking into account the increase in exposure borne 
by the EU Guarantee. 

According  to  Article  12(4),  the  resources  of  the  EFSI  GF  are  directly  managed  by  the 
Commission  and  invested  in  accordance  with  the  principle  of  sound  financial  management 
following appropriate prudential rules. 

2.5 Crisis management mechanisms which are not covered by the EU budget 

As part of the response to the crisis, several other mechanisms have been established which, 
however, do not imply any risk to the EU budget and they are only mentioned below for the 
sake of completeness: 

- the Greek Loan Facility (GLF)15 which is financed via bilateral loans from other euro area 
Member States to Greece, centrally administered by the Commission. 

-  European  Financial  Stability  Facility  (EFSF)16:  The  EFSF  was  created  by  the  euro  area 
Member States as a temporary rescue mechanism in June 2010 to provide financial assistance 
to  euro  area  Member  States  within  the  framework  of  a  macroeconomic  adjustment 
programme.  The  Treaty  establishing  a  permanent  rescue  mechanism,  the  European  Stability 
Mechanism  (ESM),  entered  into  force  on  27  September  2012.  Since  1 July  2013, the  EFSF 
continues with its ongoing programmes to Greece (together with the IMF and some Member 
States) as  well as  to  Ireland and Portugal (together with  the IMF, some Member States  and 
EU/EFSM)17  but  is  no  longer  engaged  in  new  financing  programmes  or  loan  facility 
agreements.  

-  European  Stability  Mechanism  (ESM)18:  The  ESM  is  an  important  component  of  the 
comprehensive EU strategy designed to safeguard financial stability within the euro area by 
providing  financial  assistance  to  euro  area  Member  States  experiencing  or  threatened  by 
financing difficulties. It is an intergovernmental organization under public international law, 
based in Luxembourg, with an effective lending capacity of EUR 500 billion. 

14 

15 

16 
17 
18 

Regulation  (EU)  2015/1017  of  the  European  Parliament  and  of  the  Council  of  25  June  2015  on  the 
European  Fund  for  Strategic  Investments,  the  European  Investment  Advisory  Hub  and  the  European 
Investment Project Portal and amending Regulations (EU) No 1291/2013 and (EU) No 1316/2013 — the 
European Fund for Strategic Investments  (the "EFSI Regulation"). The agreement on the management of 
the  EFSI  and on  the granting of  the  EU guarantee  (the  "EFSI Agreement") was  signed by  the  European 
Commission  and  the  European  Investment  Bank  (the  "EIB")  on  22  July  2015.  An  amendment  to  this 
Agreement was signed on 21 July 2016.  
About the GLF:  
http://ec.europa.eu/economy_finance/assistance_eu_ms/greek_loan_facility/index_en.htm. 
About the EFSF: http://www.efsf.europa.eu. 

The loans granted under the EU/EFSM are guaranteed by the EU budget. 
About the ESM: http://esm.europa.eu. 

5 

 
                                                                                                                                                         
3. 

EVOLUTIONS OF GUARANTEED OPERATIONS  

This  section  sets  out  the  evolution  of  the  guaranteed  operations;  firstly  of  those  managed 
directly by the Commission and secondly those managed by the EIB.  

Table 1: Total outstanding amounts covered by the EU budget at 31 December 2017 (in EUR million) 

Outstanding 
Capital 

Accrued 
Interest 

Total 

% 

Member States* 

Euratom 

 195.99  

 0.64  

 196.62  

0.24% 

BOP 

EIB 

EFSM 

Sub-total Member 
States** 

Third Countries*** 

MFA 

Euratom 

EIB**** 

 3,050.00  

 64.08  

 3,114.08  

3.79% 

 1,378.38  

 10.90  

 1,389.28  

1.69% 

 46,800.00  

 656.03  

 47,456.03  

57.82% 

 51,424.36  

 731.65  

 52,156.02  

63.55% 

 3,901.47  

 22.23  

 3,923.70  

4.78% 

 52.92  

 0.26  

 53.17  

0.06% 

 25,791.24  

 145.98  

 25,937.22  

31.60% 

Sub-total third countries 

 29,745.62  

 168.47  

 29,914.09  

36.45% 

Total 

 81,169.98  

 900.12  

 82,070.11   100.00% 

* 

This risk is directly covered by the EU budget. This also includes Euratom and EIB loans granted to 
Member State countries prior to their accession to the EU. 

**  This figures does not include EFSI operations, where EUR 10,128 million have been disbursed at the 

reporting date. 

***  The risk covered by the Fund is limited to 18.58 billion. 

**** Loans subrogated to the EU following Syria and Enfidha (Tunisia) defaults on EIB loans are included 
(amount:  EUR  432.16  million  including  outstanding  capital,  accrued  interest  and  penalties).  These 
loans have been fully impaired in the EU Financial Statements of 2015, 2016 and 2017.  

Tables  A1,  A2a,  A2b  and  A3  of  the  SWD  provide  more  detailed  information  on  these 
outstanding amounts, in particular in terms of ceiling, disbursed amounts or guarantee rates. 

3.1. 

Operations managed directly by the Commission  

Financial support for third countries and Member States in the form of bilateral loans financed 
from the capital markets with the guarantee of the EU budget is provided by the Commission 
under  various  legal  acts  of  the  Council  or  of  the  Council  and  the  European  Parliament, 
depending on the objectives pursued. The consistency of financial support to third countries 
with the overall objectives of the EU external action policy is ensured by the Commission and 

6 

 
 
 
 
 
 
 
 
 
 
the High Representative of the Union for Foreign Affairs and Security Policy, assisted by the 
European External Action Service (EEAS). 

Therefore, in order to finance the lending activities decided by the Council, the Commission 
is empowered to borrow funds on the capital markets on behalf of both the European Union 
and Euratom. Borrowing and lending is conducted as back to back operations, which ensures 
that  the  EU  budget  does  not  take  any  interest  rate  or  foreign  exchange  risk19.  Outstanding 
borrowings are matched by outstanding loans. 

Table 1: Operations of the EU in 2017 (in EUR million) 

19 

The EFSM Regulation allows resorting to pre-funding as it authorises the Commission "to borrow on the 
capital  markets  or  from  financial  institutions  at  the  most  appropriate  time  in  between  planned 
disbursements so as to optimise the cost of funding and preserve its reputation as the Union's issuer in the 
markets." However, any resulting cost of carry is borne by the borrower. 

7 

InstrumentBeneficiary Disbursament DateAmount IssuedUkraine MFA III - 2nd instalment - 04/04/203104/04/2017600Georgia - 2nd instalment - 18/05/203218/05/201713Tunisia MFAI - 3rd instalment - 20/07/203220/07/2017100Tunisia MFAII - 1st instalment - 04/04/203125/10/2017200Jordan MFAII - 1st instalment - 04/04/203125/10/2017100EuratomEnergoatom (Ukraine) - 1st instalment - 04/05/202704/05/201750Total1 063MFA 
 
                                                 
Table 2: New Borrowing-and-lending operations (guaranteed by the Union budget) planned for 2018 and 2019 
(in EUR million) 

3.1.1.  European Financial Stabilisation Mechanism (EFSM) 

In its conclusions of 9/10 May 2010, the Ecofin Council foresaw a volume of the mechanism 
of  EUR 60,000 million20.  In  addition,  euro-area  Member  States  stood  ready  to  complement 
such  resources  if  necessary.  Article  2(2)  of  Council  Regulation  No  407/201021  limits  the 
outstanding  amount  of  loans  or  credit  lines  to  be  granted  to  Member  States  to  the  margin 
available under the own resources ceiling for payment appropriations. 

Following  the  Council  decisions  to  grant  Union  financial  assistance  to  Ireland22  (up  to 
EUR 22,500  million)  and  Portugal23  (up  to  EUR  26,000  million),  disbursements  reached 
EUR 22,500  million  to  Ireland  and  EUR  24,300  million  to  Portugal  (the  remaining 

20 

21 

22 

23 

Cf. Press release on extraordinary Ecofin Council meeting 9/10 May 2010 
(http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ecofin/114324.pdf). 
Council  Regulation  (EU)  No  407/2010  of  11  May  2010  establishing  a  European  financial  stabilisation 
mechanism (OJ L 118, 12.5.2010, p.1). 
Council Implementing Decision 2011/77/EU of 7 December 2010 on granting Union financial assistance 
to Ireland (OJ L 30, 4.2.2011, p. 348). 
Council Implementing Decision 2011/344/EU of 30 May 2011 on granting Union financial assistance to 
Portugal (OJ L 159, 17.6.2011, p. 88); see also corrigendum (OJ L 178, 10.7.2012, p.15). 

8 

Instrument20182019A. Union and Euratom borrowing-and-lending operations with a Union budget guarantee1. Union macro-financial assistance for third countries (MFA)sOperations decided or scheduled:Georgia III1520Jordan II100Moldova2040Tunisia II 300Ukraine IV500500Subtotal MFA 9355602. Euratom loans501003. Balance of payments 004. European Financial Stabilisation Mechanism (EFSM) 4 500[1]0Subtotal A5 485660B. European Investment Bank loans with a Union budget guarantee1. Pre-accession countries9831 1352. Neighbourhood and partnership countries2 0612 0373. Asia and Latin America5634174. Republic of South Africa7469Subtotal B3 6813 657Grand total9 1664 317[1]Portugal and Ireland are entitled to request a lengthening of maturities on their existing EU loans. The next maturing EFSM loans are due on 4 April 2018 and Ireland has requested an extension. Further EUR 1 100 000 000 are due from Ireland (EU 500 000 000) and Portugal (EUR 600 000 000) on 4 October 2018. 
 
                                                 
EUR 1,700  million  were  not  requested  by  the  Portuguese  government).  Accordingly,  the 
EFSM  has  a  remaining  capacity  of  EUR 13,200 million  to  provide  further  assistance,  if 
required. 

In  April  2013  the  Eurogroup/ECOFIN  decided  to  increase  the  maximum  weighted  average 
maturity  of  EFSM  loans  from  12.5  to  19.5  years,  thus  offering  an  option  to  the  beneficiary 
countries to request a lengthening of loan maturities up to 2026 (tranche by tranche). 

Developments during 2017 

Ireland 

A request to lengthen the EFSM loan of EUR 3.4 billion - disbursed to Ireland in March 2011 
and  due  on  4  April  2018  -  was  received  from  Ireland  on  27  November  2017.  The  loan  has 
been  refinanced  during the first  quarter of 2018 in  two transactions with maturities in April 
2025 (EUR 2.4 billion) and April 2033 (EUR 1 billion).  

Furthermore, an additional request to lengthen the EFSM loan of EUR 0.5 billion disbursed to 
Ireland in October 2011 - which is due on 4 October 2018 – is expected to be received from 
Ireland in the second quarter of 2018. 

Following  the  maturity  extension  in  Q1/2018,  the  weighted  average  maturity  of  the  EFSM 
loans to Ireland is now 16.8 years. 

Portugal 

A request to lengthen the EFSM loan of EUR 600 million disbursed to Portugal in October 
2011  -  which  is  due  on  4  October  2018  -  is  expected  to  be  received  from  Portugal  in  the 
second quarter of 2018. 

3.1.2.  Balance of Payments facility (BOP) 

The EU medium-term financial assistance under the BOP facility was re-activated at the end 
of  2008  to  support  Hungary  and  subsequently  Latvia  and  Romania  to  restore  market 
confidence  for  a  total  commitment  of  EUR  14,600  million,  of  which  EUR  13,400  million 
were disbursed.  

Developments during 2017 

Romania  repaid  a  loan  tranche  of  EUR  1,150  million  in  September  2017.  The  outstanding 
amount of BOP loans  has thus decreased from EUR 4,200  million to EUR 3,050  million in 
2017. 

At 31 December 2017, the BOP facility had a remaining capacity of EUR 46,950 million out 
of an overall ceiling of EUR 50,000 million to provide further assistance if required.  

3.1.3.  Macro-Financial Assistance loans (MFA) 

As  a  general  rule,  MFA  decisions  are  taken  by  the  European  Parliament  and  the  Council 
(Article 212 of the TFEU). However, the Council may adopt the decision on a proposal from 
the  Commission  when  the  situation  in  a  third  country  requires  urgent  financial  assistance 

9 

 
 
(Article  213  of  the  TFEU)  and  that  procedure  was  used  in  the  second  MFA  package  for 
Ukraine in 2014. 

Developments during 2017 

Georgia 

The second and last tranche (EUR 13 million out of the EUR 23 million decision in loans) of 
the loan granted to Georgia24 under its previous MFA programme (MFA I) was disbursed on 
18th May 2017. 

Hashemite Kingdom of Jordan 

Jordan’s second programme (MFA II) 

The  Memorandum  of  Understanding  (MoU)  and  the  Loan  Facility  Agreement  (LFA)  for 
Jordan  II  were  signed  on  the  19th  September  2017.  The  ratification  by  the  Jordanian 
Authorities also took place on the 19th September 2017 and the entry into force of the Loan 
Agreement  on the 3rd October 2017. The first tranche  of EUR 100  million (out of the EUR 
200  million  decision)  of  Jordan’s  second  programme  (MFA  II)25  was  disbursed  on 
25th October 2017. 

Tunisia 

Tunisia’s first programme (MFA I) 

The  remaining  amount  of  EUR  100  million  (out  of  the  EUR  300  million  decision)  of 
Tunisia’s first programme (MFA I)26 was disbursed on 20th July 2017. 

Tunisia’s second programme (MFA II) 

The  Memorandum  of  Understanding  (MoU)  and  the  Loan  Facility  Agreement  (LFA)  for 
Tunisia  II  were  signed  on  the  27th  April  2017.  The  ratification  by  the  Tunisian  Authorities 
took  place  on  the  11th  August  2017  and  the  entry  into  force  of  the  Loan  Agreement  on  the 
8th September  2017.  The  first  tranche  of  EUR  200  million  (out  of  the  EUR  500  million 
decision) of Tunisia’s second programme (MFA II)27 was disbursed on 25th October 2017. 

Ukraine 

24 

25 

26 

27 

Decision  778/2013/EU  of  the  European  Parliament  and  of  the  Council  of  12  August  2013  providing 
macro-financial assistance to Georgia (OJ L 218, 14.8.2013, p. 15). 
Decision (EU) 2016/2371 of the European Parliament and of the Council of 14 December 2016 providing 
further macro-financial assistance to the Hashemite Kingdom of Jordan (OJ L 352, 23.12.2016, p. 18). 
Decision 534/2014/EU of the European Parliament and of the Council of 15 May 2014 providing macro-
financial assistance to the Republic of Tunisia (OJ L 151, 21.05.2014, p. 9). 
Decision (EU) 2016/1112 of the European Parliament and of the Council of 6 July 2016 providing further 
macro-financial assistance to Tunisia (OJ L 186, 09.07.2016, p. 1). 

10 

 
 
                                                 
On  16th  March  2017,  the  Commission  adopted  a  decision  to  disburse  the  second  tranche  of 
EUR 600 million under Ukraine’s third MFA programme (MFA III)28. The disbursement took 
place on 4th April 2017. The third and final tranche (EUR 600 million) under that programme 
was cancelled. 

On 13 September 2017, the European Parliament and the Council decided to provide further 
macro-financial  assistance  to  the  Republic  of  Moldova29  of  EUR  100  million  (up  to 
EUR 60 million  provided  in  the  form  of  loans  and  up  to  EUR  40  million  in  the  form  of 
grants).  

In 2017 the Commission also adopted a proposal for a new MFA operation of EUR 45 million 
to Georgia (The adoption by the co-legislators was still pending at the end of the year). 

Regarding repayments, EUR 58.13 million were repaid by the beneficiary countries (Albania 
EUR  1.8  million,  Bosnia  and  Herzegovina  EUR  4  million,  former  Yugoslav  Republic  of 
Macedonia EUR 8 million, Montenegro EUR 1.10 million and Serbia EUR 43.23 million).  

The  outstanding  amount  of  MFA  loans  has  increased  from  EUR  2,946.6  million  to 
EUR 3,901.47 million between 31 December 2016 and 31 December 2017. Loans to Ukraine 
represent 72% of the total MFA exposure. 

Developments subsequent to 31 December 2017 (until 30 June 2018) 

Adoption  of the  Decision (EU) 2018/598  of the European Parliament and of the Council  of 
18 April 2018 providing further macro-financial assistance to Georgia30. 

3.1.4.  Euratom loans 

The Euratom lending to Member States or in certain eligible non-member countries (currently 
Russian Federation, Armenia, Ukraine) has a ceiling of EUR 4,000 million of which around 
92%  has  already  been  disbursed.  EUR  326  million  remain  under  the  EUR  4,000  million 
Decision. 

A  loan  of  EUR  300  million  to  Ukraine  dedicated  to  the  safety  upgrade  of  existing  nuclear 
facilities  was  signed  on  7  August  2013  and  the  Guarantee  Agreement  was  ratified  by  the 
Ukrainian Parliament on 15 May 2014. The loan will be provided in close cooperation with 
the EBRD, which provides another EUR 300 million loan in parallel.  

On  27  May  2015  the  Commission  authorised  disbursements  under  the  Euratom  loan  to 
Energoatom  in  the  amount  of  up  to  EUR  100  million,  subject  to  Energoatom  having  drawn 
the  loan  amount  granted  by  the  EBRD  in  an  amount  not  less  than  EUR  50  million.  These 

28 

29 

30 

Decision (EU) 2015/601 of the European Parliament and of the Council of 15 April 2015 providing further 
macro-financial assistance to Ukraine (OJ L 100/1, 17.04.2015). 
Decision  (EU)  2017/1565  of  the  European  Parliament  and  of  the  Council  of  13  September  2017  on 
providing macro-financial assistance to the Republic of Moldova (OJ L 242, 20.9.2017, p. 14). 
Decision (EU) 2018/598of the European Parliament and of the Council of 18 April 2018 providing further 
macro-financial assistance to Georgia (OJ L 103, 23.4.2018, p. 8–13). 

11 

 
 
                                                 
loans  benefit  from  State  guarantees  which  cover  100%  of  the  amounts  outstanding  at  year 
end.  

Developments during 2017 

The first Euratom tranche of EUR 50 million was disbursed in May 2017. 

Developments subsequent to 31 December 2017 

A second loan tranche of EUR 50 million is planned for June 2018. 

3.2. 

Evolution of the EIB external financing operations 

Developments during 2017 

Under  the  EIB  general  mandate  covering  the  period  2014-2020,  a  total  amount  of 
EUR 13,879 million had been signed at 31 December 2017, of which only EUR 3,516 million 
was disbursed at that date, leaving the outstanding capital at EUR 3,185 million (see Table A3 
of the SWD). For more information on the countries covered by the EIB mandates, see Tables 
A1, A3 and A4 of the SWD. 

For previous EIB external mandates, see Table A3 of the SWD. 

Defaults on interests payments and loan repayments from the Syrian Government continued 
in  2017.  The  EIB  has  called  on  the  Guarantee  Fund  to  cover  those  defaults  (see  paragraph 
5.1.3 below). 

Outstanding amounts at 31 December 2017 for the various facilities referred to in this section 
are presented in section 3 above (Table 1). 

4. 

RISKS COVERED BY THE EU BUDGET 

4.1. 

Definition of risk 

The risk borne by the EU budget derives from the outstanding amount of capital and interest 
in respect of guaranteed operations. 

For the purpose of this report, two methods are used for evaluating the risks borne by the EU 
budget (either directly or indirectly via the Fund): 

–  "The total risk covered" is based on the sum of the total amount of capital outstanding for 

the operations concerned on a given date including accrued interest31.  

–  The budgetary approach defined as "the annual risk borne by the EU budget" is based on 
the calculation of the maximum amount of annual payments due which the EU would have 
to  pay  out  in  a  financial  year  assuming  that  all  payments  of  the  guaranteed  loans  are  in 
default32. 

31 
32 

See Table 1 of the Report. 

For  the  purpose  of  that  calculation,  it  is  assumed  that  defaulting  loans  are  not  accelerated,  i.e.  only 
payments due are taken into account (see Tables 2 and 3 of the report and Table A4 of the SWD). 

12 

 
                                                 
4.2. 

Total risk composition 

Until  2010  the  maximum  risk  in  terms  of  total  outstanding  amounts  covered  was  mainly 
linked to loans granted to third countries. Since 2011, the financial crisis has heavily affected 
the public finances of the Member States leading to an increase in the lending activity of the 
EU to support sovereign financing needs in Member States. 

As  a  consequence  the  composition  of  risk  has  changed.  At  31  December  2017,  64%  of  the 
total  outstanding  amount33  concerns borrowing operations linked to  loans to  Member  States 
which are directly covered by the EU budget (compared to 45% at 31.12.2010). 

4.3. 

Annual risk covered by the EU budget 

With reference to outstanding loans at 31 December 2017 (see Table 1 above) the maximum 
amount which the EU would have to pay out during the year 2018 (directly and via the Fund) 
- assuming that all guaranteed loans would be in default - is EUR 9,965 million. That amount 
represents  the  capital  and  interest  payments  from  guaranteed  loans  falling  due  during  2018, 
assuming that defaulting loans are not accelerated (for details see Table A4 in SWD).  

4.3.1.  Member State exposure 

In 2018, the EU will bear a maximum annual risk related to operations with Member States 
(MS) of EUR 7,482.8 million (75.1% of the total annual risk). That risk concerns: 

(a) EIB lending and/or Euratom loans granted before Member States' accession to the EU; 

(b) the loans granted under the BOP facility, and  

(c) the loans granted under the EFSM scheme.  

Table 2: Ranking of the Member States according to the annual risk borne by the EU budget in 2018 (EUR million) 

Ranking 

Country 

Loans 

1 

2 

3 

4 

5 

6 

7 

Ireland  

Romania 

Portugal 

Bulgaria 

Croatia 

Latvia 

Poland 

33 

See Table 1. 

c) 

a+b) 

c) 

a) 

a) 

a+b) 

a) 

Max annual risk  Weight of the 
country vis-à-
vis annual risk 
of MS 

Weight of the 
country vis-à-
vis total annual 
risk (MS and 
non-MS) 

4,507.25 

1,603.89 

1,191.00 

67.65 

35.77 

26.06 

20.70 

60.2% 

21.4% 

15.9% 

0.9% 

0.5% 

0.3% 

0.3% 

45.2% 

16.1% 

12.0% 

0.7% 

0.4% 

0.3% 

0.2% 

13 

 
                                                 
8 

9 

Slovakia 

Czech Republic 

10 

Lithuania 

a) 

a) 

a) 

13.82 

13.16 

3.49 

0.2% 

0.2% 

0.0% 

0.1% 

0.1% 

0.0% 

Total 

7,482.8 

100.0% 

75.1% 

4.3.2.  Third country exposure 

In 2018, the Fund will bear a maximum annual risk related to the exposure to third countries 
of  EUR 2,482.09  million  (24.9%  of  the total  annual  risk). The  risk  linked  to  third  countries 
concerns  EIB  lending,  MFA  and  Euratom  loans  (details  are  included  in  Table  A2b  of  the 
SWD). The Fund covers guaranteed loans to third countries with maturities extending up to 
2042. 

The top ten countries (out of 46 non-MS) are ranked below according to the repayments due 
in  2018.  They  account  for  EUR  2,041.42  million  or  82%  of  the  annual  risk  related  to  third 
countries borne by the Fund for 2018. The economic situation of those countries is analysed 
and commented in point 3 of the SWD. Creditworthiness, as assessed by the rating agencies, 
is also indicated in each country table.  

14 

 
 
 
 
Table 3: Ranking of the 10 third countries with the highest exposure according to the annual risk borne by the EU budget in 
2018 (EUR million)  

Ranking 

Country 

Max annual 
risk 

Weight of the 
country vis-à-
vis annual risk 
of third 
countries 

Weight of the 
country vis-à-
vis total annual 
risk (MS and 
non-MS) 

1 

2 

3 

4 

5 

6 

7 

8 

9 

Turkey 

Tunisia 

Egypt 

Morocco 

Serbia 

Ukraine 

South Africa 

Lebanon 

Bosnia 
Herzegovina 

and 

604.90 

273.93 

267.21 

247.22 

209.08 

131.92 

111.47 

77.07 

63.20 

24.4% 

11.0% 

10.8% 

10.0% 

8.4% 

5.3% 

4.5% 

3.1% 

2.5% 

6.1% 

2.7% 

2.7% 

2.5% 

2.1% 

1.3% 

1.1% 

0.8% 

0.6% 

10 

Syrian Arab 
Republic 

55.44 

2.2% 

0.6% 

Total (top 10) 

2,041.42 

82.2% 

20.5% 

5. 

ACTIVATION AND PAYMENT OF GUARANTEES 

5.1. 

Debt service not covered by the Guarantee Fund for External Action (Euratom 
loans to Member States, EFSM and BoP) 

5.1.1.  Payments from cash resources 

The  EU  budget  provisionally  covers  the  debt  service  at  due  dates  in  case  a  debtor  fails  to 
repay  its  loan  to  the  EU  on  time.  The  Commission  draws  on  its  cash  resources  in  order  to 
avoid delays and any resulting costs in servicing its borrowing operations34.  

Being  mindful  of  most  expenditures  taking  place  during  the  first  quarter  of  each  year,  debt 
redemption is structured for the months thereafter as well as for the beginning of each month 
when cash balances are highest. 

34 

See Article 14 of Council Regulation (EU, Euratom) No 609/2014 of 26 May 2014 on the methods and 
procedure for making available the traditional, VAT and GNI-based own resources and on the measures to 
meet cash requirements (OJ L 168, 7.6.2014, p. 39). 

15 

 
 
 
                                                 
5.1.2.  Payments from the EU budget  

In the event that one or more Member States do not meet their legal obligations35 and that the 
EU’s own resources are insufficient, the Commission can use available EU budget resources 
and prioritise debt repayment over other non-obligatory expenditures. According to the MFF, 
if this proves to  be  insufficient,  EU legislation obliges  Member States to  provide additional 
contributions necessary to repay the debt and to balance the budget, up to a ceiling of 1.20% 
of  EU  GNI.  If  needed,  EU  legislation  allows  Member  States  to  contribute  independently  of 
their share to the EU budget. 

As  no  default  from  Member  States  occurred  during  the  year  2017,  no  appropriation  was 
requested. 

5.2 

Calls on the Guarantee Fund for External Actions and recoveries (ELM, MFA 
and Euratom loans to Third countries) 

In  the  event  of  late  payment  by  the  beneficiary  of  a  loan  to  third  countries  granted  or 
guaranteed  by  the  EU,  the  Guarantee  Fund  is  called  on  to  cover  the  default  within  three 
months of the request. 

The  amounts  called  by  the  EIB  are  withdrawn  from  the  Guarantee  Fund  account  after 
authorization  by  the  Commission  services.  When  the  EU  makes  a  payment  under  the  EU 
Guarantee, it is subrogated into the rights and remedies of the EIB 36. For Euratom and MFA 
loans, If the payment delay reaches three months after the due date, the Commission draws on 
the Fund to cover the default37 and to replenish its treasury. 

Recovery  proceedings  are  undertaken  by  the  EIB  on  behalf  of  the  EU  in  respect  of  the 
subrogated sums38. 

EIB loans to projects in Syria 

Starting from December 2011, the EIB has experienced defaults on certain interest payments 
and  loan  repayments  from  the  Syrian  Government.  Since  official  payment  requests  have 
remained  unsuccessful,  the  EIB  started  to  call  on  the  Guarantee  Fund  in  May  2012.  The 
evolution of the calls corresponding to defaulting loans in Syria is presented in Table 4a. 

35 

36 

37 

38 

Council  Regulation  (EU,  Euratom)  No  609/2014  of  26  May  2014  on  the  methods  and  procedure  for 
making  available  the  traditional,  VAT  and  GNI-based  own  resources  and  on  the  measures  to  meet  cash 
requirements (OJ L 168, 7.6.2014, p. 39). 
See  Article  8.7  of  Decision  No  466/2014/EU  of  the  European  Parliament  and  of  the  Council  of 
16 April 2014 granting an EU guarantee to the European Investment Bank against losses under financing 
operations supporting investment projects outside the Union. 
Except for Bulgaria and Romania which were granted Euratom loans before joining the Union. The loans 
(and loans guarantees) to accession countries were covered by the Fund until the date of accession. From 
that  date,  those  that  remained  outstanding  ceased  to  be  external  actions  of  the  Union  and  are  therefore 
covered directly by the EU budget. 
For further information on recovery proceedings, see also the Recovery Agreement signed on 25 July 2014 
between the European Union and The European Investment Bank governing modalities and procedures for 
recovery of payments made by the EU under the guarantees granted by it to the EIB against losses under 
financing operations supporting investment projects outside the EU. 

16 

 
 
 
                                                 
Table 4a: Calls on the Guarantee Fund due to defaulting loans in Syria (in EUR million) 

Year 
(Withdrawal 
from GF 
account on) 

Number of 
calls paid 

Amount of 
due 
instalments 

Penalties and 
accrued 
interests39 

Amount 
recovered 

Total 

2012 

2013 

2014 

2015 

2016 

2017 

Total 

2 

8 

8 

8 

12 

13 

38 

24.0 

59.3 

58.7 

58.7 

103.8 

56.1 

360.5 

0.0 

1.4 

1.5 

1.5 

2.4 

0.2 

6.9 

2.2 

0.0 

0.0 

0.0 

0.0 

0.0 

2.2 

21.8 

60.7 

60.2 

60.2 

106.2 

56.3 

365.3 

At  31  December  2017,  the  total  capital  outstanding  of  guaranteed  loans  related  to  Syria 
amounted to EUR 555 million40, with the final loan maturity in 2030. 

TAV Tunisie S.A. (Enfidha airport) 

The  EIB  called  on  29  June  2016  the  EU  guarantee  under  the  external  lending  mandate  in 
relation to a loan to TAV Tunisie S.A. (Enfidha airport). 

In 2017, the Commission paid EUR 28.7 million to the EIB for 3 calls on a defaulted loan to 
Enfidha Airport (Tunisia). From September 2016 until December 2017, the Commission paid 
in total EUR 33.4 million to the EIB for 4 calls (paid from the Fund). The last payment took 
place on 15 December 2017. 

The calls on the Fund corresponding to the defaulting loan to TAV Tunisie S.A. (Enfidha 
airport) are presented in Table 4b. 

39 

40 

Penalties  and  accrued  interests  are  claimed  by  the  EIB  only  with  the  second  payment  request  of  each 
individual loan and run from the default date until the payment date by the Guarantee Fund. 
This includes the amount of EUR 360.52 million (principal + interest) already called by the EIB. 

17 

 
                                                 
Table 4b: Call on the Guarantee Fund relating to TAV Tunisie S.A. (Enfidha airport) (in EUR million) 

Year of 
withdrawal  

Number of 
calls paid 

Amount of 
due 
instalments 

Penalties and 
accrued 
interest32  

Amount 
recovered 

Total 

2016 

2017 

Total 

1 

3 

4 

4.56 

28.69 

33.25 

0.09 

0.01 

0.10 

0.00 

0.00 

0.00 

4.65 

28.70 

33.35 

Developments subsequent to 31 December 2017 (until 30 June 2018) 

In February and March 2018, EUR 10.6 million in total were paid in two calls for defaulted 
payments of Syria (EUR 3.2 million and EUR 7.4 million including penalties applied by EIB). 

On 15 January 2018, EUR 0.14 million recovered from Enfidha Airport were credited to the 
Guarantee Fund. This amount was already recognised as an asset (receivable) in the balance 
sheet of 31 December 2017. 

5.3. 

Evolution of the Fund 

In  accordance  with  Regulation  establishing  the  Guarantee  Fund  for  External  Actions  ("the 
Guarantee Fund Regulation")41, the Fund has to reach an appropriate level (target amount) set 
at  9%  of  the  total  outstanding  capital  liabilities  arising  from  each  operation,  plus  accrued 
interest. A provisioning mechanism is in place to ensure the target amount is met. 

On the basis of the provisioning mechanism, the EU budget paid EUR 240.54 million to the 
Fund  in  February  2017,  while  in  February  2018  the  respective  payment  amounted  to 
EUR 137.8 million. 

At 31 December 2017, the net assets42 of the Fund amounted to EUR 2,559.81 million. The 
ratio between the net assets and the outstanding capital liabilities43 (EUR 29,589.28 million), 
within  the  meaning  of  the  Guarantee  Fund  Regulation,  was  lower  than  the  target  amount. 
Consequently, the Guarantee Fund will be provisioned by EUR 103.22 million  in 201944. 

A  review  to  assess  the main  parameters  of  the Fund,  in  particular  the  target  rate,  should  be 
undertaken  at  the  time  of  the  mid-term  review  of  the  EIB  external  lending  mandate. 
Therefore,  an  evaluation  of  the  Guarantee  Fund  was  carried  out  by  an  external  contractor 
taking  into  account  the  risk  profile  of  the  Fund  and  its  effectiveness  in  the  light  of  the 
evolution of the external financing covered by the Fund and the related risks. The report was 

41 

42 
43 
44 

Council  Regulation  (EC,  Euratom)  No  480/2009  of  25 May 2009  establishing  a  Guarantee  Fund  for 
external actions (codified version), the "Guarantee Fund Regulation" (OJ L 145, 10.6.2009, p.10). 

Total assets of the Fund minus accrued payables (EIB fees and audit fees). 
Including accrued interests. 
Due  to  the  planned  use  of  EUR  55  million  of  external  assigned  revenue,  only  EUR  48.22  million  was 
entered in the draft 2019 budget. 

18 

 
 
                                                 
delivered in August 2016 and the main conclusion was that a 9% Target Rate is still deemed 
optimal for the current risk level of the loans portfolio, even under a scenario of further rating 
downgrades of the main obligors. Therefore, the 9% Target Rate is kept unchanged. 

6. 

THE EUROPEAN FUND FOR STRATEGIC INVESTMENTS (EFSI) 45 

The EFSI GF is provisioned progressively taking into account the increase in exposure borne 
by the EU Guarantee. 

According  to  Article  12(4),  the  resources  of  the  EFSI  GF  are  directly  managed  by  the 
Commission  and  invested  in  accordance  with  the  principle  of  sound  financial  management 
following appropriate prudential rules. 

The EIB and the EIF are responsible for assessing and monitoring the risk of the individual 
operations backed by the EFSI Guarantee. On the basis of this reporting and of coherent and 
prudent assumptions on future activity, the Commission maintains the adequacy of the target 
amount  and  the  level  of  the  EFSI  GF  under  review.  In  line  with  Article  16(3)  of  the  EFSI 
Regulation, the EIB and the EIF reported back to the Commission and the European Court of 
Auditors in March 2018. 

Pursuant to Article 16(2) of the EFSI Regulation, the annual report of the EIB to the European 
Parliament  and  Council  shall  contain  specific  information  on  the  aggregate  risk  associated 
with  the  financing  and  investment  operations  carried  out  under  the  EFSI  as  well  as  on 
guarantee calls. 

Developments during 201746 

The guarantee exposure of the EU in relation to disbursed outstanding EFSI operations by the 
EIB  Group  amounted  to  EUR  10,128  million,  as  at  31  December  2017,  out  of  the  legal 
commitment  of  EUR  16,000  million  guaranteed  by  the  EU  (Article  11  of  the  EFSI 
Regulation).  The  amount  of  EUR  10,128  million  is  recorded  as  a  contingent  liability  in  the 
notes to the 2017 financial statements of the EU. 

In  2017,  EFSI  operations  managed  by  the  EIB  under  the  Infrastructure  and  Innovation 
Window generated revenue of EUR 61.0 million for the EU. Of this amount, a receivable of 
of the Commission from the EIB as at 31 December 2017 of EUR 31.9 million was recorded 
in the 2017 EU financial statements. 

For  the  EFSI  operations  managed  by  the  EIF  under  the  SME  Window,  the  EU  incurred  in 
2017  an  estimated  amount  of  EUR  12.7  million  concerning  EIF  administrative  fees.  The 
amount is payable to the EIF on 30 June 2018. 

45 

46 

Regulation  (EU)  2015/1017  of  the  European  Parliament  and  of  the  Council  of  25  June  2015  on  the 
European  Fund  for  Strategic  Investments,  the  European  Investment  Advisory  Hub  and  the  European 
Investment Project Portal and amending Regulations (EU) No 1291/2013 and (EU) No 1316/2013 — the 
European Fund for Strategic Investments  (the "EFSI Regulation"). OJ L 169, 1.7.2015, p. 1. 

Information  for  this section  have  been  extracted  from  the  Report  from  the  Commission  to  the  European 
Parliament,  the  Council  and  the  Court  of  Auditors  on  the  management  of  the  Guarantee  Fund  of  the 
European Fund for Strategic Investments in 2017 - COM(2018)345 final of 28.5.2018. 

19 

 
 
                                                 
The net assets of the Guarantee Fund stood at EUR 3,504 million as at 31 December 2017. 
The  assets  were  composed  of  the  investment  portfolio,  classified  as  available-for-sale 
(EUR 3,414 million), an FX forward sale of USD with positive net present value, classified as 
financial  assets  at  fair  value  through  surplus  and  deficit  (EUR  6  million),  short  term  bank 
deposits (EUR 40 million) and cash and cash equivalents (EUR 44 million). 

At  the  end  of  2017,  total  cumulated  signatures  under  EFSI  amounted  to  EUR  37.4  billion 
covering  28  Member  States,  of  which  EUR  27.4  billion  was  signed    by  the  EIB  (278 
operations)  and  EUR  10.0  billion  was  signed  by  the  EIF  (328  operations).  Overall,  this 
represents  a  significant  increase  compared  to  2016,  at  the  end  of  which  total  signatures 
amounted to EUR 21.3 billion.  

At the end of 2017, the overall outstanding disbursed exposure covered by the EU Guarantee 
amounted to nearly EUR 10.1 billion, up from EUR 4.4 billion in 2016.  

The exposure of the EU budget to possible future payments under the EU Guarantee in terms 
of signed operations (disbursed and undisbursed) amounted to EUR 13.5 billion. 

Under  the  IIW  the  outstanding  disbursed  exposure  covered  by  the  EU  Guarantee  was 
EUR 9.57  billion,  of  which  EUR  9.36  billion  for  debt  operations  and  EUR  0.21  billion  for 
equity-type operations. 

For more information on the management of the EFSI Guarantee Fund, see the last version of 
the  report  from  the  Commission  to  the  European  Parliament,  the  Council  and  the  Court  of 
Auditors  on  the  management  of  the  Guarantee  Fund  of  the  European  fund  for  strategic 
investments47 and the associated Staff Working Document (SWD). 

47 

Last version - COM(2018)345 final of 28.5.2018. 

20