Ahead of the United Kingdom’s departure as a member of the European Investment Bank, as part of its withdrawal from the European Union, EIB President Werner Hoyer expressed his regret about Brexit, but welcomed the firm support of the EU 27 and the constructive engagement of the UK during withdrawal negotiations.
The UK’s withdrawal from the European Union will automatically end its membership of the EIB and its 16.11% subscribed capital in the bank.
“The EIB Group is an important benefit of European Union membership. In the UK, we have supported transformational investments, enhanced economic opportunities, helped small businesses and improved social infrastructure since 1973,” Hoyer said.
“I deeply regret the decision of the British people to leave the European Union,” Hoyer added. “I will miss the flag outside my office window.”
“I will also miss the insightful contribution of UK board members and vice presidents over the years to the EIB Group’s work and DNA of the organisation,” he said.
“I look forward to a new kind of relationship, which should reflect our unique commonality of purpose, and the strength of the relationship between the United Kingdom and the European Union. This is a bond that will always remain especially strong and of fundamental importance to both sides.”
“I also wish to thank Michel Barnier and his colleagues and their UK counterparts for their constructive cooperation in ensuring the EIB’s unique role as the EU bank is not damaged by Brexit,” said Hoyer.
Replacement of UK capital to take place at midnight
The Governors of the European Investment Bank, Europe’s finance ministers unanimously agreed last year that the departure of the United Kingdom from the European Union would not affect the financing activity or have any impact on the EIB’s business model.
The UK’s share of the EIB’s paid-in capital prior to Brexit represents EUR 3.5 billion, alongside EUR 35.7 billion of callable capital. The UK’s callable capital disappears on Brexit day and is replaced by the UK’s liability on callable capital.
On 1 March 2020 two member states, Romania and Poland, will contribute additional capital, providing the EIB with a higher capital base than before Brexit.
The UK will remain liable for the EIB’s pre-Brexit operations. This liability will be reduced as the EIB’s pre-Brexit exposure declines.
The EIB will reimburse the UK’s EUR 3.5 billion paid-in share over 12 annual instalments following Brexit.
No Brexit impact on EIB’s and EIF’s AAA rating
The United Kingdom's decision to exit the EU will not have a material impact on the EIB's and EIF’s AAA credit rating.
Rating agencies recognize the firm support of the remaining EU 27 shareholders who have agreed to replace the UK's share in the EIB's subscribed capital at midnight on 31 January.
Contracts for UK projects assured
The EIB Group will fully respect existing finance contracts for projects and investments in the UK.
Future role of EIB Group in the UK
No discussion has taken place concerning the future engagement of the EIB Group in the UK during the financial settlement. The European Union notes the UK’s desire to explore possibilities.