The European Investment Bank (EIB), the European Union's long-term financing institution, has been awarded the ICEA-INVERSEGUROS prize for the financial product rated as best by the insurance sector in 1997. This is the first time the accolade has gone to a non-resident winner. The prize was received this afternoon in Madrid by Mr Luís Martí, EIB Vice-President, in the course of a ceremony in which he also spoke about the EIB's role on the capital markets.

The award-winning product was an ESP 14 000 million 10-year bond issue launched in January 1997. The issue terms offered an attractive return (7.28%) during the first four years and a variable return (12.80% less 12 month ESP Libor) during the following six years, thereby giving investors the possibility of a higher yield if interest rates drifted down. The issue was lead-managed by Banco Santander de Negocios.

This annual prize was introduced in 1988 by ICEA, a cooperative insurance-sector research association numbering over 250 insurance-company members, and INVERSEGUROS, the sector's brokerage arm with over 60 members. It is awarded for the financial product singled out as the year's most attractive by the insurance industry in terms of innovation and capacity to meet the investment needs of insurance companies.

The EIB was set up in 1958 by the Treaty of Rome establishing the European Economic Community, with the task of contributing to the integration, balanced development and economic and social cohesion of the Member Countries by providing long-term finance for capital investment furthering European Union (EU) objectives. In practical terms, these are to correct regional imbalances, improve transport and telecommunications infrastructure, protect the rural and urban environment, promote energy self-sufficiency, enhance the international competitiveness of industry, support small and medium-sized businesses, modernise educational and health facilities and foster urban renewal.The Bank is owned by the EU's Member Countries. It funds its operations by borrowing on the capital markets, where its bond issues consistently command first-class ("AAA") credit rating. The EIB is the biggest international issuer on the capital markets, and in Spain ranks as the leading issuer on the Matador bond market. In 1997 funds raised reached a total of ECU 22 400 million, with resources tapped in pesetas amounting to 435 000 million after swaps. Resources raised in pesetas are used for EIB loan disbursements in Spain.

The conversion rates used by the EIB for statistical purposes during the current quarter are those obtaining on 30 March 1998, when ECU 1 = GBP 0.64, IEP 0.79, USD 1.076, ESP 168.62.