New Member States join the European Investment Bank

EIB inaugurated today the participation of the new Member States in its decision-making bodies. The EIB's Board of Directors in its new composition officially welcomed ten representatives from the countries that joined the European Union on 1 May.

EIB President Philippe Maystadt stated at the ceremony arranged for the new members of the EIB's Board of Directors: I am happy to welcome officially the Directors from the new Member States and wish them all the best in this new venture. The Bank's activities in the new Member Countries have focused on financing projects underpinning their preparations to join the European Union and such operations will continue to represent a fundamental part of our task in the future, with a view to fostering these countries' integration into the EU.

Philippe Maystadt concluded his welcoming address by saying that we, at the European Investment Bank, are proud to be part of an expanding European Union and to become the house bank of ten new Member States, who can rest assured of our commitment in the future.

Mr Wolfgang Roth, EIB Vice-President responsible for operations in the majority of the new Member Countries said: I welcome the new Board of Directors' decision to propose to the Board of Governors the appointment of Mr Ivan Pilip as new EIB Vice-President with responsibility for certain new Member States. The Bank is ready to increase its lending in the new Member Countries especially in the area of extending and upgrading their infrastructure, particularly cross-border transport, energy and telecommunications networks. This is necessary to ensure their successful participation in the EU Single Market and exploit the potential of their economies to the full.

When joining the European Union, the new Member States subscribe ipso facto to the Bank's capital. Their share reflects their economic weight within the EU as measured by their proportion of the EU's GNP (Gross National Product). As from 1 May 2004, the new members account for 4.6% of the EIB's capital and the Bank's subscribed capital amounts to EUR 163.7 billion.

The newcomers are participating actively in the decision-making processes of the Bank. The EIB's Statute as annexed to the Accession Treaty was amended to take account of the new members.

• The Board of Governors - the governing body of the institution - increased from 15 to 25 members, each Member State having one representative, generally its Finance Minister.
• The Board of Directors' new composition consists of one Director for each Member State plus a representative of the European Commission. Decisions at the Board meetings are taken by a majority consisting of at least one third of members and representing at least 50% of the subscribed capital.
• The Management Committee - the Bank's permanent executive body - will gain a Vice-President, taking the number of members from 8 to 9.

The European Investment Bank has established itself as the single major external source of finance in the new Member States. In the period 1990-2003, it granted financing exceeding EUR 25 billion in these countries and the Accession States (Romania and Bulgaria). Transport and telecommunications infrastructure accounted for 55% of EIB lending in the region, followed by 14% for environmental projects, 7% for energy projects and 7% for industry and services - as well as 14% for small and medium-sized projects supported indirectly through EIB Global Loans. Last year's financing amounted to a record 4.6 billion (representing more than 10% of total EIB loans). In the next few years, the Bank is expecting a 10% increase in lending to the 10 new Member States, as it continues to support investment projects - mainly projects linking these countries to the western EU - and contribute to the deepening of their integration into the Union for the benefit of the whole enlarged EU.

In the new Member States, the Bank's priorities are to support projects that help integrate their economies into the EU Single Market and contribute to the application of European standards as developed in the acquis communautaire.

The EIB was established in 1958 as the European Union's long-term lending institution to finance projects in the EU's Member States furthering their economic and social integration. It is an autonomous institution in the framework of the European Union's structure. It is owned by the EU Member States who directly subscribe to its capital. The EIB has its own administrative structure and decision-making bodies independent of the other EU institutions. The EIB finances investment projects contributing to the integration, balanced development and economic and social cohesion of the EU's Member States.

The Bank funds its lending by borrowing on international capital markets. It is a major international borrower, and has been consistently  awarded a AAA credit rating by leading rating agencies. This enables the EIB to mobilise large volumes of funds at advantageous terms. The Bank on-lends these resources on a non-profit-maximising basis with only a small mark-up to cover its administrative costs and maintain an appropriate level of own funds. This makes it possible to provide medium and long-term loans at attractive interest rates with appropriate grace periods on repayment of principal.