REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Half-yearly report on the implementation of borrowing, debt management and related lending operations pursuant to Article 12 of Commission Implementing Decision C(2022)9700 1 July 2023 - 31 December 2023
Date: 2024-02-22
Institutions: Directorate-General for Budget, European Commission
Subjects: EU aid, EU borrowing, EU financing arrangements, EU strategy, Ukraine, debt, economic recovery, financial management, macro-financial assistance

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 22.2.2024  COM(2024) 93 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Half-yearly report on the implementation of borrowing, debt management and related lending operations pursuant to Article 12 of Commission Implementing Decision C(2022)9700                                      1 July 2023 - 31 December 2023                            
 
 
Table of Contents 

1.  Summary ........................................................................................................................................................................................... 3 

2. 

3. 

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

Implementation of borrowing operations in the second half of 2023 .......................................................... 4 

4.  Cost of funding and liquidity balances ............................................................................................................................. 8 

5.  Steps to further develop the ecosystem of EU-Bonds ............................................................................................ 9 

6.  Other milestones in the second half of 2023 ........................................................................................................... 10 

7. 

Issuance outlook for the first half of 2024 ................................................................................................................ 10 

EN 

  EN 

 
 
 
 
 
FUNDING RAISED H2 2023 

DISBURSEMENTS 

All amounts in EUR billion 

1 

 
 
 
 
 
 
OUTSTANDING EU-BONDS  
at 31/12/2023 

KEY FACTS 

- EUR 115.9 billion was raised in 2023. 
- Cost of funding was 3.2% in the first half of 2023 and 3.6% in the second half of 2023. 
- The raised funds were mainly used to finance NextGenerationEU (including RePowerEU) and 

MFA+ loans for Ukraine.  

- NextGenerationEU makes the EU economy greener, more digital, and more diversified in its 

energy supply. 

- MFA+ loans covered a large part of Ukraine’s short-term funding needs in 2023. 

2 

 
 
 
 
 
 
 
1. Summary 

In the second half of 2023, the Commission raised EUR 37.7 billion, bringing the total raised over 
2023  to  EUR  115.9  billion.  In  2023,  EUR  99.1  billion  was  disbursed  under  NextGenerationEU, 
making the EU economy greener, more digital, and more diversified in  its energy supply. In 2023, 
Ukraine  received  EUR  18  billion  in  highly  concessional  loans  via  MFA+,  covering  a  large  part  of 
Ukraine’s short-term funding needs for 2023. 

The  EU’s  cost  of  funding  during  continued  to  increase  in  the  second  half  of  2023  in  line  with 
market  conditions  -  from  3.2%  in  the  first  half  of  2023  to  3.6%  in  the  second  half.  The  spread 
between 10-year EU-Bonds and 10-year German bonds remained relatively stable, ending the year 
close to 73 basis points (compared to 68 basis points at 30 July 2023). However, the peak of 81 
basis points reached in October 2023 underlined that since EU-Bonds are being priced against the 
swap curve, they have higher yields compared to European government bonds (EGBs) whenever a 
risk-averse sentiment takes hold. The end-of-year saw market pricing of EU debt fall sharply (from 
3.7%  in  October  to  2.8%  at  year-end  for  10-year  EU-Bonds)  as  expectations  now  favour  lower 
interest rates at some stage in 2024. 

During  the  second  half  of  2023  the  Commission  made  further  progress  in  strengthening  the 
architecture  underpinning  its  issuance  programme.  In  addition  to  introducing  a  unified  funding 
approach in January 2023, the Commission launched a quoting arrangement system in November 
2023, and completed the EU issuance service (EIS) at the start of 2024. The completion of the EIS 
reflects the partnership between the Commission, the ECB and other national and EU official sector 
institutions  in  building  the  EU  debt  issuance  programme.  The  Commission  also  published  its  first 
comprehensive  NGEU  green  bonds  allocation  and 
report  which  shows  how 
NextGenerationEU green bond issuances are supported by a pool of planned eligible expenditures 
across  Member  States  and  how  these  expenditures  are  helping  to  reduce  EU  greenhouse-gas 
emissions. 

impact 

Further steps to increase liquidity will be taken in 2024, with the launch of the repurchase facility 
planned for the second half of 2024. Furthermore, the Commission has started to liaise with index 
providers  on  how  to  classify  EU  securities  in  their  indices  and  will  continue  to  encourage  market 
counterparties to provide to EU-Bonds the same quality of collateral treatment in bilateral secured 
transactions that they provide to sovereign bonds. 

2. Introduction 

The Commission has been borrowing funds on behalf of the European Union for over 40 years. The 
past 3 years have seen a marked increase in the EU’s bond issuance as it relies on capital markets 
to  finance  large  programmes  such  as  SURE1,  NextGenerationEU  (NGEU),  and  Macro-Financial 
Assistance + (MFA+) for Ukraine. By end-2023 the EU had just over EUR 440 billion in outstanding 
liabilities resulting from its bond issuance, of which about EUR 405 billion have been issued since 
2020.  

In  line  with  Article  12  of  Commission  Implementing  Decision  C(2022)9700,  which  lays  down  the 
arrangements  for  the  implementation  of  the  unified  funding  approach  for  borrowing  and  debt 
management  operations2,  this  half-yearly  report  reviews  the  implementation  of  borrowing 
operations  between  1  July  2023  and  31  December  2023.  It  also  presents  the  steps  that  the 
Commission is taking to further develop the ecosystem for EU-Bonds – with the aim of increasing 

1 The European instrument for temporary Support to mitigate Unemployment Risks in an Emergency (SURE). 
2 In accordance with Article 220a of the Financial Regulation (Council Regulation 2018/1046) on the financial 
rules applicable to the general budget of the Union. 

3 

 
 
 
the liquidity of EU-Bonds and facilitating a market standing that reflects the EU’s issuance volumes 
and credit strength for the benefit of the Member States. Finally, it provides an outlook for EU-Bond 
issuance in the first half of 2024. This report does not evaluate how the proceeds from EU-Bond 
issuances are used, including for green expenditure, as this is covered in separate reports under the 
regulations for each instrument3. 

Further  to  the  recommendation  of  the  European  Court  of  Auditors4,  the  annex  to  this  report 
presents  indicators  that  can  be  used  to  monitor  the  implementation  of  the  overarching  debt 
management strategy guiding the Commission’s unified funding approach5.   

3. Implementation of borrowing operations in the second half 

of 2023 

In  the  second  half  of  2023,  the  Commission  continued  to  raise  funds  in  the markets  through  its 
unified  funding  approach.  In  addition  to  meeting  all  the  disbursement  commitments  under 
NextGenerationEU  and MFA+ on time, issuance amounts and maturities  remained within the pre-
set parameters, and financing terms were in line with those of an issuer of the EU’s size and rating. 
The  sections  below  present  some  of  the  key  components  of  the  Commission’s  borrowing  and 
lending  operations  in  the  second  half  of  2023.  Further  indicators  used  to  monitor  the 
implementation of the Commission’s funding strategy are discussed in the annex to this report. 

EXECUTION OF FUNDING OPERATIONS IN THE SECOND HALF OF 2023 

In June 2023, the Commission announced its intention to issue EUR 40 billion in EU-Bonds over the 
period from July to end-December 2023 to finance in particular NextGenerationEU and MFA+ for 
Ukraine (complementing its EUR 80 billion funding plan from  the first half of 2023). The funding 
plan  reflected  expected  disbursements  needs  for  the  remainder  of  2023  as  well  as  the  liquidity 
holdings at the start of the semester. 

The  Commission  completed  its  funding  programme  for  2023  by the end  of  November6,  raising  a 
total of EUR 115.9 billion over the course of the year. EUR 37.7 billion of this funding was raised in 
the second half of the year with an average maturity of 13 years (compared to around 14 years 
for the funding raised in the first half of 2023).  

The  Commission  used  a mix  of  syndications  (64%)  and  auctions  (36%),  in  keeping  with  the  ratio 
achieved in the first half of 2023. The EU-Bond issuances were spread over the semester, taking 
into  account  market  liquidity  conditions  while  ensuring  regular  presence  in  the  market.  These 
transactions  included  the  tapping  of  two  existing  NextGenerationEU  green  bond  lines  for  a  total  
of EUR 4.7 billion. These additional green bond issuances were undertaken following the reporting 
of  additional  climate-relevant  expenditures  by  Member  States  under  the  Recovery  and  Resilience 
Facility (RRF). 

3 See for example the annual reports for the Recovery and Resilience Facility and Macro-Financial Assistance 
and the NextGenerationEU Green Bonds Allocation and Impact report.   
4 Special report 16/2023: NGEU debt management at the Commission and Replies of the Commission 
5 A description of the overarching debt management strategy can be found in the half-yearly report on the 
execution  of  the  EU  borrowing  and  lending  operations  1  January  2023  –  30  June  2023,  see  Fourth  half-
yearly report on the execution of the EU borrowing and lending operations.PDF (europa.eu). 
6  December  is  usually  a  quiet  month  in  financial  markets  as  investors  tend  to  close  their  books  ahead  of 
year-end, making the market less attractive for primary issuance. 

4 

 
 
 
 
Chart 2: Funding raised under the unified funding approach 

* The first two NextGenerationEU transactions took place in June 2021. These have been included in the number for H2 
2021 as they were part of the same Funding Plan as the transactions that took place in H2 2021. 

All amounts in EUR billion 

The transactions in the second half of 2023 brought the total outstanding amount of EU-Bonds to 
just over EUR 440 billion by end-2023. Of this amount, EUR 405 billion has been issued since the 
start  of  the  SURE  programme  in  2020  with  EUR  286  billion  issued  as  EU-Bonds  under  the  EU’s 
unified funding approach. The remainder of the outstanding bonds were issued under designated 
policies  to  finance  loans  with  a  matching  duration  (for  example,  SURE  loans  and  MFA  loans  to 
Ukraine granted in 2022 are financed using this ‘back-to-back’ approach). 

Of the EUR 286 billion issued under the EU’s unified funding approach, EUR 48.9 billion was issued 
in the form of NextGenerationEU green bonds.  

In the second half of 2023, the Commission also issued 3-month and 6-month EU-Bills through bi-
monthly  auctions  to  meet  short-term  funding  needs.  The  EU  had  EUR  15.2  billion  in  credit 
outstanding through EU-Bills at the end of December 2023. The Commission maintained issuance 
under the EU-Bill programme at a minimum level in light of low short-term funding needs. 

DISBURSEMENTS 

On  the  back  of  these  transactions,  the  Commission  continued  the  funding  of  Member  States’ 
recovery and resilience plans through the timely disbursement of proceeds. The Commission made 
all  disbursements  to  Member  States  under  the  RRF,  on  average  within  6  working  days  of 
authorisation of the disbursement. 

In the second half of 2023, the Commission disbursed EUR 67.4 billion to 18 Member States under 
the  RRF,  of  which  EUR  1.7  billion  were  pre-financing  payments  for  REPowerEU  chapters.  Of  this, 
EUR 35.3 billion was in the form of non-reimbursable support and EUR 32.1 billion was in the form 
of loans. As part of NextGenerationEU,  the Commission also transferred EUR 10 billion to the EU 
budget  in  the  second  half  of  2023  to  contribute  to  programmes  such  as  Horizon  Europe,  the 
InvestEU  Fund,  ReactEU,  the  EU  Civil  Protection  Mechanism  (RescEU),  the  European  Agricultural 
Fund for Rural Development (EAFRD), and the Just Transition Fund. 

Overall, since the start of NextGenerationEU in the summer of 2021, the Commission has disbursed 
EUR 261.7 billion: (i) EUR 141.6 billion in non-reimbursable support and EUR 79.2 billion in loans to 
Member  States  under  the  RRF;  and  (ii)  EUR  40.9  billion  for  the  other  NextGenerationEU-funded 
spending  programmes.  So  far,  EUR  260  billion  of  NextGenerationEU  has  been  financed  through 
borrowing and EUR 1.7 billion has been financed by other sources (i.e., the Emission Trading Scheme (ETS) 
and the Brexit adjustment reserve (BAR)). 

5 

 
 
 
In  addition  to  NextGenerationEU  disbursements,  in  the  second  half  of  2023,  the  Commission 
disbursed EUR 9 billion in loans to Ukraine under the MFA+ programme, funded by bond issuance 
under the unified funding approach. This brings the total amount of funding disbursed to Ukraine 
under  the  MFA+  programme  to  EUR  18  billion  for  2023.  Overall,  in  the  second  half  of  2023  the 
Commission disbursed a total of EUR 86.4 billion for NextGenerationEU (including REPowerEU) and 
MFA+  combined.  This is  higher  than  the  disbursements  in  the  first  half  of  2023  (around  EUR  30 
billion) when the pace of outflows during the first half of the year was temporarily impacted by the 
need  to  revise  national  recovery  and  resilience  plans  (among  others,  for  adding  REPowerEU 
chapters). 

INVESTOR DEMAND AND SECONDARY MARKET LIQUIDITY 

Despite  the  volatility  in  rates  observed  over  the  period,  EU-Bond  issuances  continued  to  enjoy 
demand from a well-balanced and diversified investor base with different types of investors from 
all across the world7. 

Chart 3: Investor split 

7  To  date,  EU  issuances  have  in  total  attracted  more  than  1,700  different  investors  over  70  different 
countries. Over 60% of investment in EU-Bond syndications has come from investors located in the EU, and 
more  than  20%  has  come  from  international  investors  operating  from  the  UK.  The  remainder  has  come 
from international investors in Asia or other non-EU European countries like Norway and Switzerland. Over 
65%  of  the  EU-Bonds  issued  have  been  going  to  buy-and-hold  investors  (i.e.,  fund  managers,  insurance 
companies,  pension  funds  and central  banks / official  institutions).  There  is also  a  good  representation  of 
investors  demanding  different  maturities.  Central  banks  /  official  institutions  and  bank  treasuries  (which 
usually  prefer  to  invest  in  maturities  up  to  10  years)  account  for  about  45%  of  purchases  of  EU-Bonds 
in  the  primary  markets,  while  pension  funds  and  insurance  companies  (which  prefer  maturities  above  
10 years) account for almost 15%. 

6 

 
 
 
 
 
 
New  issue  premiums  (NIPs)8  demanded  by  investors  as  a  concession  when  the  EU  issues  bonds 
through syndication stood at around  2.5 basis points in the second half of 2023, which is in line 
with  those  offered  by  other  issuers  on  comparable transactions (measured  by  size  and maturity) 
during that period.  

At the same time, the secondary market liquidity of EU-Bonds was consistently in line with levels 
observed in the markets for the most liquid European government bonds (EGBs),  when measured 
relative to the amounts outstanding. Secondary market liquidity for EU-Bonds was supported by the 
introduction  on  1  November  2023  of  quoting  arrangements whereby  EU  primary  dealers  are 
encouraged  to  post  reliable  EU-Bond  prices  on  the  leading  electronic  bond  trading  platforms. 
Despite  being  in  its  infancy,  the  quoting  of  EU-Bonds  on  interdealer  platforms  is  already 
comparable  when  measured  in  average  daily  volumes,  to  levels  observed  for  sovereign  issuers. 
Daily  trading  volumes  of  EU-Bonds  averaged  around  EUR  900  million  in  November  2023  and  
EUR 550 billion in December 2023, with a maximum daily peak of above EUR 2 billion. 

The combination of tapping existing lines and creating new lines (new 5-year, 7-year and 20-year 
EU-Bonds  launched  in  the  second  half  of  2023)  also  supported  secondary  market  liquidity.  As  a 
result, the average amount outstanding per EU-Bond remained at around EUR 13 billion by the end 
of the semester, ensuring consistent liquidity of the bonds. 

Chart  4:  Quarterly  secondary  market  turnover  of  EU  and  European  government  bonds  
(% of outstanding volume) 

Source:  European  Commission  based  on  data  of  the  EFC  Subcommittee  on  EU  Sovereign  Debt  Markets 
(ESDM).  
Note: European government bond (EGB) market here comprises euro-area sovereigns, the European Financial 
Stability Fund and the European Stability Mechanism. Data are not yet available for Q4 2023. 

8 This new issue premium (NIP) is a premium that the issuer pays in order to persuade investors to buy its 

bonds in the primary market rather than in the secondary market.  

7 

 
 
 
 
 
4. Cost of funding and liquidity balances 

COST OF FUNDING 

In the second half of 2023, interest costs increased in line with general market conditions. The cost 
of funding9 for July to December 2023 is estimated to be close to 3.6%, compared to 3.2% in the 
previous semester. 

Chart 5: Cost of funding over time 

H2 2021 

H1 2022 

H2 2022 

H1 2023 

H2 2023 

0.14% 

1.16% 

2.51% 

3.20% 

3.56% 

While  inflation  has  slowed  materially  from  its  peak  of  above  10%  in  October  2022,  inflationary 
pressures remained sticky. Until October 2023, market expectations leaned heavily towards further 
rate increases, leading in the third quarter of 2023 to higher issuance costs for the EU along with 
all other issuers. 

These  developments  led  to  a  steepening  of  government  bond  yield  curves,  reaching  post-2011 
highs  in  October  2023:  above  3%  for  German  10-year  bonds,  above  3.5%  for  French  10-year 
bonds,  and  close  to  5%  for  Italian  10-year  bonds.  The  spread  between  10-year  EU-Bonds  and  
10-year German bonds remained relatively stable throughout the second half of 2023, ending the 
year at close to 73 basis points (compared to 68 basis points at 30 July 2023), down from a peak 
of 81 basis  points in October 2023. Risk-averse market sentiment in the middle of the  semester 
led investors to pursue conservative investment policies, favouring  EGBs relative to EU-Bonds and 
other  sub-sovereign  or  supranational  bonds  (SSA)  issuers.  This  led  to  a  widening  of  spreads 
between  EU-Bonds  and  the  most  liquid  core  EGBs,  even  though  this  does  not  reflect  the 
fundamentals (credit quality, liquidity, volume and regularity) of the EU-Bond issuance programme. 
The  Commission  is  undertaking  sustained  action  to  encourage  markets  to  price  EU-Bonds  more  
in line with these underlying characteristics of the programme (see Section 4).  

As inflation slowed faster than expected towards year-end, expectations of further rate hikes were 
replaced by expectations of earlier and bigger rate cuts in 2024. The EU saw yields on its 10-year 
bond fall from a peak of 3.7% in October to 2.8% at year-end and a narrowing of spreads against 
German and French bonds of similar maturity. 

LIQUIDITY MANAGEMENT 

The Commission maintained a regular and predictable presence in financial markets in line with the 
funding plan announced in June 2023, with planned dates for auctions and syndications. However, 
cash  outflows  were  slower  than  initially  planned,  leading  to  higher  average  cash  holdings  in  the 
second  half  of  2023,  averaging  EUR  58.7  billion  compared  with  EUR  36.8  billion  in  the  previous 
semester.  The  Commission  reduced  its  cash  intake  through  Bill  issuance  to  ensure  continued 
market presence while minimising the increase in cash balances.  

9 The interest costs incurred are allocated to the budget and the Member States receiving loans in accordance 
with  the  methodology  set  out  in  Commission  Implementing  Decision  (EU)  2021/1095  and  its  successor 
Commission  Implementing  Decision  (EU)  2022/9701.  This  methodology  distinguishes  between  three 
different  cost  categories:  (i)  cost  of  funding  to  finance  non-reimbursable  support  and  loan  disbursements 
calculated  for  6-monthly  time  compartments,  (ii)  cost  of  holding  and  managing  liquidity,  and  (iii) 
administrative costs. 

8 

 
 
 
 
The  higher  amounts  of  liquidity  holdings  did  not  translate  into  any  costs  for  the  programmes 
supported. On the contrary, a net income of EUR 79.7 million was earned on the cash holdings from 
July to December 2023. This income will be shared proportionately between the EU budget and RRF 
loan beneficiaries. 

In  2024,  the  Commission  will  build  on  its  new  authorisation  to  deploy  a  more  active  liquidity 
management approach in order to optimise returns on cash holdings. 

5. Steps to further develop the ecosystem of EU-Bonds 

The establishment of a unified funding approach as of January 2023 represented a key milestone 
in  building  a  robust  framework  for  meeting  the  EU’s  funding  needs  as  efficiently  as  possible.  
This approach allows the Commission to plan, execute and communicate all issuances in an agile 
and  consistent  way,  under  a  common  risk,  compliance,  and  governance  framework  for  all  
borrowing operations. 

Nevertheless, despite this ongoing transformation of the EU as an issuer and the gradual shift in 
the treatment of EU-Bonds10, markets continue to treat and price EU-Bonds against the swap curve. 
In  order  to  collect  feedback  from  market  participants  on  the  EU  issuance  programme  and  on 
further steps to improve the functioning of  EU-Bond markets, the Commission conducted its first 
investor  survey  in  June  202311.  The  survey  showed  that  most  (about  80%)  market  participants 
regard the EU-Bond issuance programme as comparable to those of EGBs with similar outstanding 
debt in terms of regular high-volume supply, market communication, the use of auctions and the 
overall  funding  strategy.  The  survey  also  confirmed  the  importance  of  quoting  arrangements  for 
EU-Bonds (subsequently introduced in November 2023, see section 2) and a repo facility (planned 
for the second half of 2024) in supporting the desired transition towards a pricing of EU-Bonds that 
better  reflects  the  fundamentals  of  EU  issuances.  The  treatment  of  EU-Bonds  as  collateral  and 
inclusion of EU-Bonds in ‘sovereign indices’  were also highlighted as important  in that respect by 
the investor survey12. 

In line with feedback from market participants, preparations continued in the second half of 2023 
for the launch of a repurchase (‘repo’) facility to support market participants in trading EU-Bonds. 
Through the repo facility, the Commission will make its securities available on a temporary basis in 
the event of scarcity, thus helping EU primary dealers to provide liquidity in EU-Bonds. The aim is to 
open the repo desk in summer 2024. 

Furthermore, the Commission has started to engage in joint reflections with market-leading index 
providers  on  how  to  classify  EU  securities  in  their  indices.  The  issue  being  discussed  with  index 
providers is whether the EU-Bond issuance programme has outgrown its traditional inclusion in the 
SSA  indices,  of  which  it  increasingly  constitutes  an  out-sized  presence  in  the  index  basket.  
The  Commission  will  also  continue  to  encourage  market  counterparties  to  provide  to  EU-Bonds  
the  same  quality  of  collateral  treatment  in  bilateral  secured  transactions  as  that  given  to  
sovereign bonds. 

The Commission  – working in close partnership with the ECB and the National  Bank of Belgium  - 
also finalised during the second half of 2023 all the preparations for the launch of a Eurosystem-
based  post-trade  settlement  infrastructure  for  all  new  EU  debt  securities  (i.e.  new  ISINs  for  

10 For example, as of 29 June 2023, the ECB applies in its ECB’s risk control framework for credit operations 
the  same  haircut  (i.e.,  a  reduction  in  the  value  if  a  security  is used  as  collateral)  to  EU-Bonds as to  debt 
instruments issued by central governments. 

11 There were 128 respondents.  
12 More detailed information on the outcomes of the survey can be found on the Commission here. 

9 

 
 
 
EU-Bonds and EU-Bills) – known as the EU Issuance Service (EIS)13. The launch of the EIS aligns the 
settlement  infrastructure  for  EU  debt  securities  with  those  of  large  EU  sovereign  issuers  which 
benefit from the support of national central banks as fiscal agents. It also creates  a level playing 
field for all central securities depositories and investors that trade EU-issued bonds. The EIS also 
offers direct settlement of EU Bills and Bonds in TARGET2-Securities (T2S) and facilitates the use 
of EU debt securities as collateral by counterparties with central banks. The creation of the EIS was 
accompanied  by  a  complete  overhaul  of  the  EU’s  debt-issuance  programme,  filed  with  and 
approved  by  the  Luxembourg  Stock  Exchange  before  year-end.  This  allowed  the  first  EIS-settled 
transactions to go ahead smoothly in January 202414. 

6. Other milestones in the second half of 2023 

NEXTGENERATIONEU GREEN BONDS ALLOCATION AND IMPACT REPORT 

In  line  with  the  reporting  requirements  of  the  NGEU  Green  Bond  Framework,  the  Commission 
published  on  1  December  2023  the  first  comprehensive  report  on  the  allocation  and  impact  of 
NGEU green bonds.15 

The  report  provides  investors  and  stakeholders  with  updated  information  on  the  allocation  of 
proceeds as of the cut-off date of 1 August 2023 and, for the very first time, presents the climate 
impacts of investments financed by the NextGenerationEU green bond programme. 

The report shows how NextGenerationEU green bond issuances are supported by a pool of planned 
eligible  expenditure  across  Member  States  (EUR  190  billion  of  eligible  investments  relative  to 
current  green bond issuances of EUR 48.9 billion)  and provides an update on the  actual reported 
realised green expenditures by Member States.  

In  addition,  the  report  estimates  that  the  full  implementation  of  NextGenerationEU  green  bond 
expenditures can permanently reduce EU greenhouse-gas emissions by up to 44 million tonnes per 
year,  or  roughly  1.2%  of  all  EU  emissions.  The  climate  impact  of  already  realised  expenditure  is 
calculated at 0.5% of the total estimated reduction of greenhouse gas emissions of full programme 
implementation. This is expected to increase progressively up to 2026, in line with increases in the 
fulfilled  quantifiable  milestones  and  targets.  Implemented  avoidance  of  greenhouse  gas  emissions 
will be maintained well beyond 2026 for the lifetime of the financed investments. 

7. Issuance outlook for the first half of 2024 

On 12 December 2023, the Commission issued its half-yearly funding plan for January to end-June 
2024.  In  the  first  half  of  2024,  the  Commission  intends  to  issue  EUR  75  billion  in  EU-Bonds, 
complemented  by  short-term  EU-Bills.  The  Commission  will  use  these  funds  to  primarily  finance 
NextGenerationEU (including possible payments for measures included in the REPowerEU chapters). 
With  the  unified  funding  strategy  in  place,  other  policies  can  also  be  financed  from  the  planned 
issuance upon agreement of the EU legislative authorities. 

13  With  this  service,  the  Commission  will  move  from  using  a  settlement  system  comprising  commercial 
suppliers of settlement services to a Eurosystem-based settlement infrastructure with the NBB taking on the 
role  of  the  issuer  central  securities  depository  and  settlement  agent  (Issuer-CSD)  and  the  ECB  being  the 
paying agent. EU debt securities first issued prior to January 2024 will continue to follow the Commission’s 
pre-EIS  post-trade  arrangements,  where  Clearstream  Luxembourg  serves  as  CSD  and  BNP  Paribas 
Luxembourg serves as settlement bank. The co-existence of the legacy and EIS settlement systems presents 
no operational challenges. 
14 More information on these roles is available in the Factsheet on the EU Issuance Service 
15 NextGenerationEU Green Bonds Allocation and Impact report 

10 

 
 
 
Annex: Implementation indicators on the use of the means for delivering against the Commission’s overarching debt-management strategy’s 
efficiency and effectiveness objectives 

Means 

Implementation 
of the EU-Bond 
programme 

Indicator 

Value in H2 2023 (unless 
indicated otherwise) 

Commentary on execution in H2 2023 

a)  Regular issuances across the 

i.  Maturity split of 

curve 

issuance programme 

Regular EU-Bond (and NGEU green 
bond) issuances in all maturities 
across the curve (up to 30 years) to 
provide different types of investors 
with investment opportunities as a 
way of maintaining strong investor 
demand and thus the flexibility to 
determine issuance volumes and 
maturities for individual transactions 
based on market conditions. 

ii.  Timely distribution of 

issuances 

iii.  Green issuances16 

1-4 years: 11% 
4-8 years: 37%  
8-12 years: 10% 
12-17 years: 6% 
17-23 years: 14% 
23-31 years: 22% 

4 syndications and 4 bond 
auctions, resulting in 1-2 
issuances per month. 

Approximately EUR 5 billion 
through taps of 2048 and 
2033 bonds. 

b)  Achieving a proper balance of 
auctions and syndications 

i.  Split auction / 

syndication in %  

36% of bond issuances via 
auction.  

Use of different funding techniques 
with a proper balance, depending on 
total issuance volumes and market 
conditions, in order to manage 

In  H2  2023  the  Commission  pursued  its  objective 
through  regular  bond  issuances  across  different 
tenors  to  provide  the  EU  curve  with  liquidity  on  all 
segments. The funding transactions were spread over 
the  semester  to  ensure  a  regular  presence  in  the 
market.  Over  the  semester,  fewer  transactions  were 
made than in the previous semester due to the lower 
H2  2023  funding  target  of  up  to  EUR  40  billion 
(compared with EUR 80 billion in H1 2023). 

While ensuring a presence in all  benchmark  maturity 
buckets,  the  issuances  were,  on  average,  geared 
slightly  towards  the  long-end  of  the  curve  (with  an 
average maturity of issuances of around 13 years), in 
light of the need to spread redemptions over time but 
also  stronger  demand  from  investors  for  long-dated 
EU-Bonds. 

Green bond issuances were lower than in the previous 
semester, in line with the lower overall funding target, 
cumulative  reported  green  expenditures  by  Member 
States,  and  appropriate  calibration  of  green  bond 
issuances to these expenditures.  

In  H2  2023,  the  Commission  issued  36%  of  the  
EU-Bonds via auction, which is more or less the same 
share  as  in  the  previous  funding  semester.  The 
objective  is  to  expand  the  use  of  this  auction 
technique, while taking account of market specificities 
(e.g.  market absorption  capacity) and issuance needs 

16 Additional information on the NGEU green bonds can be found in the NGEU Green Bond Dashboard here: Dashboard (europa.eu) 

11 

 
 
 
 
Means 

Indicator 

Value in H2 2023 (unless 
indicated otherwise) 

Commentary on execution in H2 2023 

execution risks, improve secondary 
market liquidity and improve 
borrowing costs. 
c)  Establishment of large and liquid 

benchmark bonds 

Tapping of EU-Bonds to bring the 
outstanding volume of different 
lines to levels commensurate with 
large and liquid benchmark lines. 

d)  Management of the maturity 
profile of EU-Bond issuances  
with due regard to: 

•  the temporary additional 

headroom (for NGEU-related 
borrowing) and permanent 
headroom (for MFA+) under  
the EU budget 

•  the future redemption of 

disbursements in any given year  

•  stable future roll-over needs 

i.  Issuances via new 
bonds vs volume 
issued via taps 

• 

• 

EUR 14 billion via new 
bonds  
EUR 23.7 billion via 
taps 

ii.  Speed of tapping of 

1-2 months 

new bonds17 

iii.  Average size of 

Around 13 billion 

outstanding bonds18 

iv.  Turnover relative to 
issuance volume 

Approximately 92% over 
2023 vs 80% over H2 2022 

v.  Absolute turnover 

EUR 397 billion in H2 2023 vs 
EUR 241 billion in H2 2022 

i.  Average maturity of 

Around 13 years  

Around 12 years. 

Less than 10 % 

issuance  

ii.  Average time to 
maturity of 
outstanding debt 

iii.  Refinancing in the 
short term, i.e. 
percentage of 
outstanding stock of 
bonds and bills 
maturing in the next 
12 months 

(e.g.  ability  to  tap  existing  bonds  via  auctions  versus 
need for issuance of new lines via syndications). 

liquidity  of 

its  securities 

With  the 
in  mind,  the 
Commission used its transactions to tap existing funding 
lines,  with  approximately  63%  of  the  funding  volume 
mobilised via taps. 
New  funding  lines  were  launched  to  provide  the 
market  with  new  benchmark  lines  where  needed  on 
the curve and based on the recommendations of the 
EU  primary  dealers. New 5-year, 7-year and 20-year 
bonds were launched during the semester.  
As a result, the average amount outstanding per bond 
remained at around EUR 13 billion by the end of the 
semester, ensuring consistent liquidity of the bonds. 

In  H2  2023,  the  bond  issuances  had  an  average 
maturity of 13 years. This reflected the Commission’s 
objective  of  spreading  the  redemptions  profile  over 
time  while,  at  the  same  time,  attracting  investors  to 
EU  primary  market 
transactions.  The  average 
maturity  remained  below  the  maximum  average 
maturity of 17 years set out in the annual borrowing 
decision for 2023. 
The  average  time  to  maturity  of  outstanding  debt 
remained stable (at around 12 years). 
Refinancing  also  remained  stable, a  reflection  of  the 
past issuances and related to the redemption profile. 

17 Based on average number of months between new issuance and first tap when considering the new lines tapped over the semester. 

18 Outstanding bonds over number of bonds as at end of semester. Based on bonds issued under the diversified funding strategy. 

12 

 
 
 
 
 
Means 

•  the need to protect the EU’s 

rating to ensure low borrowing 
costs in the long run and strong 
demand from its core investor 
base. 

Indicator 

iv.  Refinancing in the 
medium term, i.e. 
percentage of 
outstanding stock of 
bonds and bills 
maturing in the next 5 
years 

Value in H2 2023 (unless 
indicated otherwise) 

Less than 35 %. 

Commentary on execution in H2 2023 

Implementation 
of the EU-Bill- 
programme 

Liquidity 
management 

Primary dealer 
network 

Regular issuance of EU-Bills with 
maturities of up to 1 year via 
auction to attract additional 
investors (or additional portfolios of 
existing investors) and support 
liquidity management. 

Management of a liquidity pool in 
view of payment obligations, 
disbursement needs and costs of 
cash holding, with due regard to 
prevailing market conditions. 

Attracting a wide range of financial 
institutions showing strong 
commitment to support the  
EU issuances. 

Communication 
with diverse 
market 
stakeholders 
and peer 
issuers  

Maintaining and building trust with 
investor base, market participants 
and peer issuers to support demand 
for EU debt and improve the EU’s 
understanding of market dynamics 
and investor needs. 

i.  Outstanding volume 

EUR 15-19 billion 

of EU-Bills 

ii.  Number of EU-Bill 

10 

auctions 

i.  Number of payment 

None 

failures due to lack of 
liquidity 

The Commission maintained issuances under the EU-
Bills  programme  at  the  minimum  level  in  light  of 
liquidity needs and long-term funding volumes. Up to 
two  auctions  a  month  were  held,  just  to  cover 
redemptions.  Outstanding  debt  under  the  EU-Bill 
programme thus remained stable at around EUR 15-
19 billion over the period. 

The  Commission  successfully  met  disbursement 
needs  and  there  were  no  settlement  failures  during 
the semester. 

i.  Number of 

institutions which 
signed underwriting 
commitments for 
transactions over the 
past 6 months 

i.  Deviations from the 
pre-announced 
timings for the 
publication of funding 
plans  

16 (compared to 17 in H2 
2022) 

The  Commission  continued  to  be  supported  by  EU 
primary  dealers  and  rotation  at  the  syndications 
helped the Commission to make best use of all banks 
eligible to be part of a syndicate. 

The  Commission  maintained  regular  and  predictable 
communication with the markets, in line with previous 
announcements. There was no deviation between the 
initial  funding  target  and  the  announced  volume  for 
funding 
the  current  semester. 
However, in the bond auctions, a reduced allocation of 
EUR  3  billion  occurred  due  to  the  securing  of 
attractive financing conditions. 

transactions 

in 

None 

13 

 
 
 
 
Means 

Commentary on execution in H2 2023 

The Commission regularly published investor statistics 
which  remained  stable  and  continued  to  see  an 
increase in its diversified investor base. 

Indicator 

ii.  Deviation from the 
volumes announced 
in the funding plan  

iii.  Investor distribution 

statistics 

Value in H2 2023 (unless 
indicated otherwise) 

Less than EUR 3 billion or 
less than 6% (compared 
with less than 2.5% in H1 
2023). 

Per type: central 
banks/official institutions 
30.8%, bank treasuries 
30.0%, fund managers 
19.1%, insurance and 
pension funds 11.7%, banks  
5.9%, hedge funds  
2.5% Per country/region:  
UK 17.6%, Benelux 16.2%, 
France 12.3%, Asia-Pacific 
10.0%, Germany 9.1%, 
Nordics 9.0%, Italy 7.6%, 
other EU 6.6%, Iberia 6.0%, 
Americas 2.1%,  
other Europe 2.0%, Middle-
East and Africa 1.5% 

14