EX-1 2 dex1.htm CONSOLIDATED AND UNCONSOLIDATED SUMMARY BALANCE SHEET Consolidated and Unconsolidated Summary Balance Sheet

EXHIBIT I

 

Page 5

EIB Group

Consolidated balance sheet as at 30 June 2004

In EUR ’000

 

ASSETS

         30.06.2004
(unaudited)
         31.12.2003

1.

    Cash in hand, balances with central banks and post office banks         7,074         11,555

2.

    Treasury bills eligible for refinancing with central banks         2,728,687         1,611,353

3.

    Loans and advances to credit institutions (Note B)                    
     a) repayable on demand    140,777         219,757     
     b) other loans and advances    23,023,825         13,287,301     
     c) loans    99,932,020         95,734,289     
         
       
    
               123,096,622         109,241,347

4.

    Loans and advances to customers (Note B)                    
     Loans    116,985,093         110,897,513     
     Specific provisions    - 183,000         - 179,000     
         
       
    
               116,802,093         110,718,513

5.

    Debt securities including fixed-income securities                    
     a) issued by public bodies    1,113,692         2,705,798     
     b) issued by other borrowers    7,576,982         6,446,392     
         
       
    
               8,690,674         9,152,190

6.

    Shares & other variable-yield securities         986,372         937,949

7.

    Intangible assets         7,660         8,075

8.

    Property, furniture and equipment         128,781         125,666

9.

    Other assets                    
     a) receivable on proportion of reserves and general provisions (Note E)    1,725,279         0     
     b) sundry debtors    541,250         461,487     
     c) Positive replacement values    5,129,386         6,536,736     
         
       
    
               7,395,915         6,998,223

10.

    Subscribed capital, called but not paid (Note E)         682,687         0

11.

    Prepayments and accrued income         2,160,712         2,014,669
              
       
               262,687,277         240,819,540

 

The bracketed notes refer to the Notes to the Consolidated Financial Statements

 

Page 6

LIABILITIES

         30.06.2004
(unaudited)
         31.12.2003

1.

    Amounts owed to credit institutions                    
     a) repayable on demand    0         0     
     b) with agreed maturity dates or periods of notice    278,921         308,203     
         
       
    
               278,921         308,203

2.

    Debts evidenced by certificates (Note C)                    
     a) debt securities in issue    211,080,208         191,297,963     
     b) others    1,238,616         1,203,079     
         
       
    
               212,318,824         192,501,042

3.

    Other liabilities                    
     a) interest subsidies received in advance    265,496         260,207     
     b) sundry creditors    1,281,872         969,372     
     c) sundry liabilities    53,274         53,707     
     d) Negative replacement values    15,470,891         16,925,122     
         
       
    
               17,071,533         18,208,408

4.

    Accruals and deferred income         3,334,935         3,323,993

5.

    Provisions for liabilities and charges                    
     - Staff pension fund    589,089         561,199     
     - Provision for guarantees issued    46,896         45,396     
         
       
    
               635,985         606,595

6.

    Minority interests         233,701         229,180

7.

    Capital (Note E)                    
     Subscribed    163,653,737         150,000,000     
     Uncalled    - 155,471,050         - 142,500,000     
         
       
    
               8,182,687         7,500,000

8.

    Consolidated reserves                    
     a) reserve fund    16,365,374         13,641,249     
     b) additional reserves    213,098         - 365,214     
     c) special supplementary reserves    0         0     
         
       
    
               16,578,472         13,276,035

9.

    Funds allocated to structured finance facility         500,000         500,000

10.

    Funds allocated to venture capital operations         1,755,067         1,868,769

11.

    Fund for general banking risks after appropriation         1,050,000         1,050,000

12.

    Profit for the financial year                    
     before appropriation    747,152         1,392,315     
     appropriation for the year to Fund for general banking risks    0         55,000     
         
       
    
     profit to be appropriated         747,152         1,447,315
              
       
               262,687,277         240,819,540

 

Page 7

Off-balance-sheet items

 

         

30.06.2004

(unaudited)

         31.12.2003
Commitments                    
- EBRD capital                    
. Uncalled         442,500         442,500
. To be paid in         8,438         16,875
- Undisbursed loans (Note B)                    
. Credit institutions    8,938,854         8,772,897     
. Customers    32,435,739         31,591,535     
    
       
    
          41,374,593         40,364,432
- Undisbursed venture capital operations         1,072,257         1,088,993
Guarantees                    
. In respect of loans granted by third parties         2,208,621         1,983,741
. In respect of venture capital operations         35,122         60,526
Fiduciary operations         4,593,901         4,552,056
Assets held on behalf of third parties                    
- Growth and environment    161         5,192     
- SME Guarantee Facility    103,812         113,121     
- European Technology Facility    98,381         98,044     
- Map Equity    29,745         29,725     
- Guarantee Fund treasury management    1,619,538         1,600,474     
- Investment Facility - Cotonou    204,838         204,653     
- Map Guarantee    14,935         17,966     
- Seed Capital Action    91         103     
    
       
    
          2,071,501         2,069,278
Special deposits for service of borrowings         111,973         160,176
Securities portfolio                    
. Securities receivable         437,827         18,309
. Securities payable         10,000         4,894
Nominal value of interest-rate swap         182,060,797         155,065,118
Nominal value of currency swap contracts payable         56,211,528         50,172,472
Nominal value of currency swap contracts receivable         50,569,882         43,213,019
Nominal value of put option granted to EIF minority shareholders (Note D)    255,465         254,520
Borrowings arranged but not yet signed         698,188         77,749
Swaps arranged but not yet signed         133         69
Securities lending         940,968         383,127

 

Page 8

CONSOLIDATED PROFIT AND LOSS ACCOUNT

FOR THE PERIOD ENDED 30 JUNE 2004

in EUR ’000

 

            30.06.2004
       30.06.2003
       31.12.2003
            (Unaudited)       (Unaudited)        

1.

   Interest and similar income       4,450,247       4,459,755       8,831,507

2.

   Interest and similar charges       - 3,566,690       - 3,595,754       - 7,081,687

3.

   Commission income       32,424       16,563       66,457

4.

   Commission expense       15       - 220       - 282

5.

   Result on financial operations       10,360       - 79,153       14,148

6.

   Other operating income       5,901       9,982       16,036

7.

   General administrative expenses       - 125,264       - 113,533       - 254,072
    a) staff costs   - 93,967       - 84,581       - 185,176    
    b) other administrative costs   - 31,297       - 28,952       - 68,896    
       
             
   

8.

   Value adjustments in respect of       - 7,218       - 7,919       - 18,407
    a) intangible assets   - 831       - 1,496       - 3,658    
    b) tangible assets   - 6,387       - 6,423       - 14,749    
       
             
   

9.

   Value adjustment on loans and advances       - 4,000       0       - 44,627

10.

   Value adjustment on venture capital operations       - 40,064       - 73,506       - 119,657

11.

   Transfer to provision for guarantees issued       - 1,688       - 3,586       - 9,127
           
     
     

12.

   Net profit from ordinary activities       754,023       612,629       1,400,289

13.

   Minority interests       - 6,871       - 3,738       - 7,974
           
     
     

14.

   Profit for the financial year       747,152       608,891       1,392,315

15.

   Appropriation to Fund for general banking risks       0       0       55,000
           
     
     

16.

   Profit to be appropriated       747,152       608,891       1,447,315
           
     
     

 

Page 9

CONSOLIDATED CASH FLOW STATEMENT AS AT 30 JUNE 2004

 

In EUR ’000

 

          30.06.2004
    30.06.2003
          (unaudited)    (unaudited)

A.

    Cash flows from operating activities :          
     Profit for the six-month period    747,152    608,891
     Adjustments :          
     Transfer to provision for guarantees issued    1,500    439
     Value adjustments on tangible and intangible assets    7,218    7,919
     Value adjustment on venture capital operations    40,064    73,506
     Exchange adjustment    - 835    - 459
     (Decrease)/Increase in accrued interest and commissions payable and interest received in advance    10,942    - 290,344
     Decrease in accrued interest and commissions receivable    - 146,043    - 45,092
     Investment portfolio amortisation    39,135    406
     Changes in replacement values (others than borrowing’s swaps)    - 606,036    - 70,261
     Profit on operating activities :    93,097    285,005
     Net increase in loans    - 6,905,881    - 10,543,983
     Net balance on NCI operations    - 353,689    7,349
     Increase in treasury portfolio    - 87,936    - 158,238
     Increase in venture capital operations    0    - 50,344
     Increase in shares and other variable yield securities    - 1,633    992
     Decrease in securitised loans    60,129    888,256
     Specific provision on loans and advances    4,000    0
     Increase/(decrease) in other assets    124,875    124,282
         
  
    

Net cash from operating activities

    - 7,067,038    - 9,446,681

B.

    Cash flows from investing activities :          
     EBRD shares paid up    - 8,438    - 8,437
     Sales of securities    243,257    130,520
     Purchases of securities    - 282,115    - 146,598
     Increases in land, buildings and furniture    - 9,502    - 3,439
     Increases in intangible fixed assets    - 415    - 1,054
         
  
    

Net cash from investing activities

    - 57,213    - 29,008
         
  

C.

    Cash flows from financing activities :          
     Issue of borrowings    31,307,409    31,437,465
     Redemption of borrowings    - 12,927,246    - 14,119,192
     IAS 39 borrowings adjustments    - 1,395,423    - 3,935,500
     Changes in replacement values on borrowing’s swap    1,407,626    4,109,366
     Decrease in commercial paper    - 1,707,357    - 1,047,737
     Decrease in amounts owed to credit institutions    - 29,282    - 489,058
     Increase/(decrease) in other liabilities    349,767    - 337,731
         
  
    

Net cash from financing activities

    17,005,494    15,617,613

 

Page 10

 

    Summary statement of cash flows          
    Cash and cash equivalents at 1st of January    17,564,902    13,913,829
    Net cash from :          
    (1) operating activities    - 7,067,038    - 9,446,681
    (2) investing activities    - 57,213    - 29,008
    (3) financing activities    17,005,494    15,617,613
    Effects of exchange rate changes on loans, borrowings and swaps    127,943    - 452,635
    Cash and cash equivalents at 30th June    27,574,088    19,603,118
    Cash analysis (excluding investment and hedging portfolios)          
    Cash in hand, balances with central banks and post office banks    7,074    22,095
    Bills maturing within three months of issue    4,402,412    3,589,745
    Loans and advances to credit institutions :          
    -accounts repayable on demand    140,777    415,700
    -term deposits accounts    23,023,825    15,575,578
         27,574,088    19,603,118

 

Page 11

Statement of movements in consolidated own funds

(in EUR ’000)

 

     30.06.2004
    31.12.2003

Share Capital

          

Subscribed capital

    163,653,737    150,000,000

Uncalled

    - 155,471,050    - 142,500,000

Paid-in capital

    8,182,687    7,500,000

Consolidated reserves and profit for the year:

          

Reserve fund

          

Balance at beginning of the year

    13,641,249    10,000,000

Transfer from Additional reserves

    0    2,217,060

Appropriation of prior year’s profit

    998,846    1,424,189

Paid in by Member States

    1,725,279    0

Balance at end of the year

    16,365,374    13,641,249

Additional reserves

          

Balance at beginning of the year without IAS adjustments

    - 131,182    3,711,915

Cumulative adjustments arising from the application of IAS 39

    - 234,032    - 140,592
    
  

Balance at beginning of the year with IAS adjustments

    - 365,214    3,571,323

Appropriation of prior year’s profit

    562,172    - 126,037

Transfer to Paid in capital

    0    - 1,500,000

Transfer to Reserve fund

    0    - 2,217,060

Changes in fair value during the year and cashflow hedge impact

    16,140    - 93,440

Balance at end of the year

    213,098    - 365,214

Special supplementary reserves

          

Balance at beginning of the year

    0    750,000

Appropriation of prior year’s profit

    0    0

Transfer to Structured Finance facility

    0    - 250,000

Transfer to Venture Capital Operations

    0    - 500,000

Balance at end of the year

    0    0

Fund for general banking risks

          

Balance at beginning of the year

    1,105,000    1,080,000

Appropriation of prior year’s profit

    - 55,000    25,000

Balance at end of the year

    1,050,000    1,105,000

Funds allocated to structured finance facility

          

Balance at beginning of the year

    500,000    250,000

Appropriation of prior year’s profit

    0    0

Transfer from Special Supplementary Reserves

    0    250,000

Balance at end of the year

    500,000    500,000

Funds allocated to venture capital operations

          

Balance at beginning of the year

    1,868,769    1,499,091

Appropriation of prior year’s profit

    - 113,702    - 130,322

Transfer from Special Supplementary Reserves

    0    500,000

Balance at end of the year

    1,755,067    1,868,769

Profit for the year

    747,152    1,392,315

Consolidated reserves and profit for the year:

    20,630,691    18,142,119

Total consolidated own funds

    28,813,378    25,642,119

 

Page 12

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED INTERIM

FINANCIAL STATEMENTS

 

NOTE A     Basis of Presentation

 

The accompanying unaudited condensed consolidated financial statements of the European Investment Bank (the “Bank”) as at June 30, 2004 do not include all of the information and footnotes required for complete financial statements. The financial statements as at and for the periods ended June 30, 2004 and December 31, 2003 are prepared on a consolidated basis.

 

In the opinion of management, all adjustments, normal recurring accruals and adjustments for the impairment of venture capital operations and loans considered necessary for a fair presentation have been recorded. The amount of the transfer to the fund for general banking risks is decided upon annually; accordingly no transfer to the fund for general banking risks is recorded in the profit and loss account for the six-month period ended June 30, 2004. The profit for the six-month period ended June 30, 2004 is not necessarily indicative of the results that may be expected for the year ended December 31, 2004.

 

The unaudited condensed consolidated financial statements as at and for the periods ended June 30, 2004 and the financial statements as at and for the year ended December 31, 2003 were prepared in accordance with International Financial Reporting Standards (IFRS).

 

Certain prior-year figures have been reclassified to conform with the current year’s presentation.

 

For further information, refer to the financial statements and footnotes thereto included in the Bank’s annual report for the year ended December 31, 2003.

 

NOTE B     Summary Statement of Loans (In Eur ’000)

 

     Loans granted

Analysis of aggregate

loans granted

(before specific provisions)

   

to intermediary

credit

institutions

   

directly to

final

beneficiaries

    Total

- Disbursed portion

    99,932,020    116,985,093    216,917,113

- Undisbursed portion

    8,938,854    32,435,739    41,374,593
    
  
  

Aggregate loans granted

    108,870,874    149,420,832    258,291,706

 

Page 13

NOTE C     Long Term Obligations

 

[See following page for summary statement of debts.]

 

NOTE D     Commitment

 

Commitment to purchase the remaining EIF shares at a fixed future price.

 

Under the terms of this put option, the EIB is offering to buy these shares from the EIF’s other shareholders on June 30, 2005 for a price of EUR 315,000 per share.

 

This purchase price represents annual appreciation of 3% compared with the purchase offer made in 2000. The EIF’s financial situation as at June 30, 2004 does not require any provision to be made by the Bank as a result of this commitment.

 

NOTE E     Subscribed Capital

 

As from the 1st May 2004, the subscribed capital has increased from 150 000 000 000 to 163 653 737 000, by virtue of the contributions of ten new Member States: Poland, Czech Republic, Hungary, Slovak Republic, Slovenia, Lithuania, Cyprus, Latvia, Estonia and Malta, and also the increase of the subscribed capital for Spain.

 

As a consequence of this capital increase, the ten new Member States also had to contribute to their share of reserves and general provision for the amounts outstanding as of April 30, 2004.

 

Page 14

NOTE C—SUMMARY STATEMENT OF DEBTS EVIDENCED BY CERTIFICATES AS AT 30 JUNE 2004 (in EUR ’000)

 

     BORROWINGS
    CURRENCY SWAPS
    NET AMOUNT
         

AMOUNTS PAYABLE (+)

OR RECEIVABLE(-)

          

PAYABLE

IN

    OUTSTANDING
AT 31.12.2003
    AVERAGE
RATE
    OUTSTANDING
AT 30.06.2004
    AVERAGE
RATE
    DUE
DATES
    31.12.2003
    AVERAGE
RATE
    30.06.2004
    AVERAGE
RATE
    OUTSTANDING
AT 31.12.2003
    OUTSTANDING
AT 30.06.2004

EUR

    85,203,015    4.75    87,527,761    4.41    2004/2040    34,511,322 +    2.36    35,266,415 +    2.29    119,714,337    122,794,176

GBP

    45,444,668    5.81    54,003,313    5.76    2004/2040    3,290,559 -    3.72    6,239,038 -    4.47    42,154,109    47,764,275

DKK

    228,341    6.00    228,722    6.00    2004/2010    70,454 +    1.95    70,572 +    1.94    298,795    299,294

SEK

    568,833    4.43    531,979    4.13    2007/2011    1,438,342 +    2.68    1,428,103 +    1.97    2,007,175    1,960,082

USD

    46,992,345    4.20    55,196,324    4.03    2004/2033    16,382,818 -    1.10    14,036,581 -    1.32    30,609,527    41,159,743

CHF

    2,599,653    3.56    2,493,111    3.57    2004/2015    52,314 -    5.85    77,746 +    5.85    2,547,339    2,570,857

JPY

    5,269,663    4.01    5,995,227    4.23    2004/2034    3,725,850 -    -0.16    4,420,514 -    -0.17    1,543,813    1,574,713

NOK

    724,974    6.00    651,929    6.13    2004/2008    595,429 -    2.57    522,729 -    1.81    129,545    129,200

CAD

    369,595    8.15    367,130    8.15    2004/2008    307,996 -    0.00    305,941 -    0.00    61,599    61,189

AUD

    2,169,385    4.91    3,079,070    5.14    2005/2013    2,169,385 -    0.00    3,079,070 -    0.00    0    0

CZK

    1,130,570    4.83    1,155,426    4.87    2005/2028    70,843 +    1.82    348,358 +    2.05    1,201,413    1,503,784

HKD

    780,222    6.16    812,213    5.91    2004/2019    780,222 -    0.00    812,213 -    0.00    0    0

MTL

    0    0.00    23,458    3.80    2009/2009    0 +    0.00    23,458 -    0.00    0    0

SIT

    0    0.00    16,667    4.75    2014/2014    0 +    0.00    16,667 -    0.00    0    0

NZD

    103,928    6.50    52,056    7.00    2007/2007    103,928 -    0.00    52,056 -    0.00    0    0

ZAR

    769,477    11.23    1,024,968    10.50    2005/2018    416,795 -    7.32    540,964 -    7.73    352,682    484,004

HUF

    489,524    7.70    852,544    7.53    2005/2012    82,225 -    12.02    447,472 -    11.15    407,299    405,072

PLN

    442,779    8.60    537,603    7.92    2004/2017    153,592 -    5.36    104,381 -    5.54    289,187    433,222

TWD

    1,122,754    4.14    1,070,351    4.07    2004/2013    1,122,754 -    0.00    1,070,351 -    0.00    0    0

SKK

    94,792    5.00    97,871    5.00    2004/2028    114,161 +    8.29    117,868 +    8.29    208,953    215,739

Negative fair

value adjustment

(IAS 39)

    - 2,003,476         - 3,398,899                                        
    
       
                                       

TOTAL

    192,501,042         212,318,824                                        
    
       
                                       

 

The redemption of certain borrowings is indexed to stock exchange indexes (historical value : 1,129 million). All such borrowings are hedged in full through swap operations.

 

Page 15

EIB

Balance sheet

as at 30 June 2004

In EUR ’000

 

ASSETS

         30.06.2004
(Unaudited)
         31.12.2003

1.

   Cash in hand, balances with central banks and post office banks         7,074         11,555
2.   Treasury bills eligible for refinancing with central banks         2,598,701         1,482,176
3.   Loans and advances to credit institutions (Note B)                    
    a) repayable on demand    110,210         195,633     
    b) other loans and advances    22,966,825         13,257,301     
    c) loans    99,932,020         95,734,289     
        
       
    
              123,009,055         109,187,223
4.   Loans and advances to customers (Note B)                    
    Loans    116,437,296         110,286,636     
    Specific provisions    - 175,000         - 175,000     
        
       
    
              116,262,296         110,111,636

5.

   Debt securities including fixed-income securities                    
    a) issued by public bodies    941,321         2,533,369     
    b) issued by other borrowers    7,428,965         6,269,895     
        
       
    
              8,370,286         8,803,264

6.

   Shares & other variable-yield securities         920,352         878,079

7.

   Participating interests (Note C)         264,165         264,832

8.

   Intangible assets         7,660         8,075

9.

   Property, furniture and equipment         122,700         119,958

10.

   Other assets                    
    a) receivable on proportion of reserves and general provisions (Note E)    1,725,279         0     
    b) sundry debtors    554,311         476,053     
        
       
    
              2,279,590         476,053

11.

   Subscribed capital, called but not paid (Note E)         682,687         0

12.

   Prepayments and accrued income         2,827,457         2,735,527
             
       
              257,352,023         234,078,378

 

The bracketed notes refer to the Notes to the Financial Statements

 

Page 16

LIABILITIES

         30.06.2004
(Unaudited)
         31.12.2003

1.

    Amounts owed to credit institutions                    
     a) repayable on demand    0         0     
     b) with agreed maturity dates or periods of notice    278,921         308,203     
         
       
    
               278,921         308,203

2.

    Debts evidenced by certificates (Note D)                    
     a) debt securities in issue    214,479,107         193,301,439     
     b) others    1,238,616         1,203,079     
         
       
    
               215,717,723         194,504,518

3.

    Other liabilities                    
     a) interest subsidies received in advance    265,496         260,207     
     b) sundry creditors    1,287,471         974,110     
     c) sundry liabilities    46,855         47,970     
     d) Currency swap contracts adjustment account    5,637,627         6,970,428     
         
       
    
               7,237,449         8,252,715

4.

    Accruals and deferred income         4,400,419         4,450,980

5.

    Provisions for liabilities and charges                    
     Staff pension fund    588,314         560,499     
     Provision for guarantees issued    17,941         17,941     
         
       
    
               606,255         578,440

6.

    Fund for general banking risks         1,050,000         1,050,000

7.

    Capital (Note E)                    
     Subscribed    163,653,737         150,000,000     
     Uncalled    - 155,471,050         - 142,500,000     
         
       
    
               8,182,687         7,500,000

8.

    Reserves                    
     a) reserve fund    16,365,374         13,641,249     
     b) additional reserves    538,361         0     
     c) special supplementary reserves    0         0     
         
       
    
               16,903,735         13,641,249

9.

    Funds allocated to structured finance facility         500,000         500,000

10.

    Funds allocated to venture capital operations         1,755,067         1,868,769

11.

    Profit for the financial year         719,767         1,423,504
              
       
               257,352,023         234,078,378

 

Page 17

Off-balance-sheet items

 

         

30.06.2004

(Unaudited)

         31.12.2003
Commitments                    
- EBRD capital                    
. Uncalled         442,500         442,500
. To be paid in         8,438         16,875
- EIF capital                    
. Uncalled         951,200         953,600
- Undisbursed loans (Note B)                    
. Credit institutions    8,938,854         8,772,897     
. Customers    32,435,739         31,591,535     
    
       
    
                     
          41,374,593         40,364,432
- Undisbursed venture capital operations         986,884         1,006,246
Guarantees                    
. In respect of loans granted by third parties         254,550         331,417
. In respect of venture capital operations         35,122         60,526
EIF treasury management         518,162         517,217
Assets held on behalf of third parties                    
- Guarantee Fund treasury management    1,619,538         1,600,474     
- Investment Facility - Cotonou    204,838         204,653     
    
       
    
          1,824,376         1,805,127
Special deposits for service of borrowings         111,973         160,176
Securities portfolio                    
. Securities receivable         437,827         18,309
. Securities payable         10,000         4,894
Nominal value of interest-rate swap         182,060,797         155,065,118
Nominal value of currency swap contracts payable         56,211,528         50,172,472
Nominal value of currency swap contracts receivable         50,569,882         43,213,019
Nominal value of put option granted to EIF minority shareholders (Note C)    255,465         254,520
Borrowings arranged but not yet signed         698,188         77,749
Swaps arranged but not yet signed         133         69
Securities lending         940,968         383,127

 

Page 18

PROFIT AND LOSS ACCOUNT

FOR THE PERIOD ENDED 30 JUNE 2004

In EUR ’000

 

              30.06.2004
         30.06.2003
         31.12.2003
              (Unaudited)         (Unaudited)          
1-   Interest and similar income         4,436,809         4,446,685         8,806,415
2-   Interest and similar charges         - 3,566,690         - 3,595,682         - 7,079,942
3-   Income from participating interests         4,771         4,556         4,556
4-   Commission income         22,157         9,108         49,607
5-   Commission expense         - 3,607         - 3,870         - 7,618
6-   Result on financial operations         - 4,235         3,198         - 4,631
7-   Other operating income         5,782         10,426         22,827
8-   General administrative expenses         - 119,992         - 108,659         - 249,372
    a) staff costs    - 89,834         -80,645         - 177,515     
    b) other administrative costs    - 30,158         -28,014         - 71,857     
        
                 
    
9-   Value adjustments in respect of         - 7,049         - 7,742         - 18,059
    a) intangible assets    - 831         -1,496         - 3,658     
    b) tangible assets    - 6,218         -6,246         - 14,401     
        
                 
    
10-   Value adjustment on loans and advances         0         0         - 40,627
11-   Value adjustment on venture capital operations         - 37,588         - 67,252         - 108,734
12-   Transfer to provision for guarantees issued         0         - 2,297         - 5,390
13-   Value adjustment on shares and other variable yield securities         - 10,591         2,273         - 528
14-   Transfer to Fund for general banking risks         0         0         55,000
15-   Profit for the financial year         719,767         690,744         1,423,504
             
       
       

 

Page 19

CASH FLOW STATEMENT AS AT 30 JUNE 2004

 

In EUR ’000

 

          30.06.2004
    30.06.2003
          (unaudited)    (unaudited)

A.

    Cash flows from operating activities :          
     Profit for six month period    719,767    690,744
     Adjustments :          
     Value adjustments on tangible and intangible assets    7,049    7,742
     Value adjustment on shares and other variable yield securities    10,591    - 2,273
     Value adjustment on venture capital operations    37,588    67,252
     Exchange adjustment    - 835    - 459
     Decrease in accrued interest and commissions payable and interest received in advance    - 50,561    - 198,633
     Decrease in accrued interest and commissions receivable    - 91,930    - 150,099
     Investment portfolio amortisation    39,815    - 223
         
  
     Profit on operating activities :    671,484    414,051
     Net loan disbursements    - 19,630,111    - 17,263,509
     Repayments    12,661,150    7,058,949
     Net balance on NCI operations    0    7,349
     Increase in treasury portfolios    - 375,599    - 163,585
     Increase in venture capital operations    - 79,310    - 46,575
     Increase/(decrease) in shares and other variable yield securities    - 1,633    992
     Decrease in securitised loans    60,129    888,256
     Increase/(decrease) in other assets    126,379    129,915
         
  
    

Net cash from operating activities

    - 6,567,511    - 8,974,157

B.

    Cash flows from investing activities :          
     EBRD shares paid up    - 8,438    - 8,437
     Sales of EIF shares    667    0
     Sales of securities    234,766    102,418
     Purchases of securities    - 273,534    - 107,500
     Increases in land, buildings and furniture    - 8,960    - 3,122
     Increases in intangible fixed assets    - 415    - 953
         
  
    

Net cash from investing activities

    - 55,914    - 17,594
         
  

C.

    Cash flows from financing activities :          
     Issue of borrowings    31,307,409    31,437,465
     Redemption of borrowings    - 12,927,246    - 14,119,192
     Decreases in currency swaps payable    - 504,649    - 307,692
     Decreases in commercial paper    - 1,707,357    - 1,047,737
     Decreases in amounts owed to credit institutions    - 29,282    - 489,058
     Increase/(decrease) in other liabilities    345,350    - 339,073
         
  
    

Net cash from financing activities

    16,484,225    15,134,713

 

Page 20

    Summary statement of cash flows          
    Cash and cash equivalents at 1st of January    17,479,778    13,812,332
    Net cash from :          
    (1) operating activities    - 6,567,511    - 8,974,157
    (2) investing activities    - 55,914    - 17,594
    (3) financing activities    16,484,225    15,134,713
    Effects of exchange rate changes on loans, borrowings and swaps    127,943    - 452,635
    Cash and cash equivalents at 30th June    27,468,521    19,502,659
    Cash analysis (excluding investment and hedging portfolios)          
    Cash in hand, balances with central banks and post office banks    7,074    22,095
    Bills maturing within three months of issue    4,384,412    3,534,245
    Loans and advances to credit institutions :          
    -accounts repayable on demand    110,210    406,441
    -term deposits accounts    22,966,825    15,539,878
         27,468,521    19,502,659

 

Page 21

NOTES TO THE UNAUDITED CONDENSED INTERIM FINANCIAL

STATEMENTS

 

NOTE A    Basis of Presentation

 

The accompanying unaudited condensed financial statements of the European Investment Bank (the “Bank”) as at June 30, 2004 do not include all of the information and footnotes required for complete financial statements. These financial statements are prepared on an unconsolidated basis.

 

In the opinion of management, all adjustments, normal recurring accruals and adjustments for the impairment of venture capital operations and loans considered necessary for a fair presentation have been recorded. The amount of the transfer to the fund for general banking risks is decided upon annually; accordingly no transfer to the fund for general banking risks is recorded in the profit and loss account for the six-month period ended June 30, 2004. The profit for the six-month period ended June 30, 2004 is not necessarily indicative of the results that may be expected for the year ended December 31, 2004.

 

These unaudited condensed financial statements as at and for the periods ended June 30, 2004 and the financial statements as at and for the year ended December 31, 2003 were prepared in accordance with the general principles of the Directive of the Council of the European Communities of 8 December 1986 (as amended by the Directive of May 31, 2001) without making use of the option available to apply fair value accounting.

 

For further information, refer to the unconsolidated financial statements and footnotes thereto included in the Bank’s annual report for the year ended December 31, 2003.

 

NOTE B    Summary Statement of Loans (In Eur ‘000)

 

     Loans granted

Analysis of aggregate

loans granted

(before specific provisions)

   

to intermediary

credit

institutions

    directly to
final
beneficiaries
    Total

- Disbursed portion

    99,932,020    116,437,296    216,369,316

- Undisbursed portion

    8,938,854    32,435,739    41,374,593
    
  
  

Aggregate loans granted

    108,870,874    148,873,035    257,743,909

 

Page 22

NOTE C    Participating Interests

 

• This item for EUR 264,165,263 corresponds to the capital paid in by the Bank in respect of its subscription (EUR 1,189,000,000) to the capital of the European Investment Fund (EIF), with its registered office in Luxembourg.

 

The Bank now holds 59.45% of the EIF’s subscribed capital as at June 30, 2004, after the sale of 26 shares since June 30, 2003.

 

• Commitment to purchase the remaining EIF shares at a fixed future price.

 

Under the terms of this put option, the EIB is offering to buy these shares from the EIF’s other shareholders on June 30, 2005 for a price of EUR 315,000 per share.

 

This purchase price represents annual appreciation of 3% compared with the purchase offer made in 2000. The EIF’s financial situation as at June 30, 2004 does not require any provision to be made by the Bank as a result of this commitment.

 

NOTE D    Long Term Obligations

 

[See following page for summary statement of debts.]

 

NOTE E    Subscribed Capital

 

As from the 1st May 2004, the subscribed capital has increased from 150 000 000 000 to 163 653 737 000, by virtue of the contributions of ten new Member States: Poland, Czech Republic, Hungary, Slovak Republic, Slovenia, Lithuania, Cyprus, Latvia, Estonia and Malta, and also the increase of the subscribed capital for Spain.

 

As a consequence of this capital increase, the ten new Member States also had to contribute to their share of reserves and general provision for the amounts outstanding as of April 30, 2004.

 

Page 23

NOTE D—SUMMARY STATEMENT OF DEBTS EVIDENCED BY CERTIFICATES AS AT 30 JUNE 2004 (in EUR ’000)

 

     BORROWINGS
   CURRENCY SWAPS
    NET AMOUNT
        

AMOUNTS PAYABLE (+)

OR RECEIVABLE(-)

          

PAYABLE
IN

    OUTSTANDING
AT 31.12.2003
   AVERAGE
RATE
   OUTSTANDING
AT 30.06.2004
   AVERAGE
RATE
   DUE
DATES
   31.12.2003
   AVERAGE
RATE
    30.06.2004
    AVERAGE
RATE
    OUTSTANDING
AT 31.12.2003
    OUTSTANDING
AT 30.06.2004

EUR

    85,203,015   4.75   87,527,761   4.41   2004/2040   34,511,322 +   2.36    35,266,415 +    2.29    119,714,337    122,794,176

GBP

    45,444,668   5.81   54,003,313   5.76   2004/2040   3,290,559 -   3.72    6,239,038 -    4.47    42,154,109    47,764,275

DKK

    228,341   6.00   228,722   6.00   2004/2010   70,454 +   1.95    70,572 +    1.94    298,795    299,294

SEK

    568,833   4.43   531,979   4.13   2007/2011   1,438,342 +   2.68    1,428,103 +    1.97    2,007,175    1,960,082

USD

    46,992,345   4.20   55,196,324   4.03   2004/2033   16,382,818 -   1.10    14,036,581 -    1.32    30,609,527    41,159,743

CHF

    2,599,653   3.56   2,493,111   3.57   2004/2015   52,314 -   5.85    77,746 +    5.85    2,547,339    2,570,857

JPY

    5,269,663   4.01   5,995,227   4.23   2004/2034   3,725,850 -   - 0.16    4,420,514 -    - 0.17    1,543,813    1,574,713

NOK

    724,974   6.00   651,929   6.13   2004/2008   595,429 -   2.57    522,729 -    1.81    129,545    129,200

CAD

    369,595   8.15   367,130   8.15   2004/2008   307,996 -   0.00    305,941 -    0.00    61,599    61,189

AUD

    2,169,385   4.91   3,079,070   5.14   2005/2013   2,169,385 -   0.00    3,079,070 -    0.00    0    0

CZK

    1,130,570   4.83   1,155,426   4.87   2005/2028   70,843 +   1.82    348,358 +    2.05    1,201,413    1,503,784

HKD

    780,222   6.16   812,213   5.91   2004/2019   780,222 -   0.00    812,213 -    0.00    0    0

MTL

    0   0.00   23,458   3.80   2009/2009   0 +   0.00    23,458 -    0.00    0    0

SIT

    0   0.00   16,667   4.75   2014/2014   0 +   0.00    16,667 -    0.00    0    0

NZD

    103,928   6.50   52,056   7.00   2007/2007   103,928 -   0.00    52,056 -    0.00    0    0

ZAR

    769,477   11.23   1,024,968   10.50   2005/2018   416,795 -   7.32    540,964 -    7.73    352,682    484,004

HUF

    489,524   7.70   852,544   7.53   2005/2012   82,225 -   12.02    447,472 -    11.15    407,299    405,072

PLN

    442,779   8.60   537,603   7.92   2004/2017   153,592 -   5.36    104,381 -    5.54    289,187    433,222

TWD

    1,122,754   4.14   1,070,351   4.07   2004/2013   1,122,754 -   0.00    1,070,351 -    0.00    0    0

SKK

    94,792   5.00   97,871   5.00   2004/2028   114,161 +   8.29    117,868 +    8.29    208,953    215,739
    
     
                                   

TOTAL

    194,504,518       215,717,723                                    
    
     
                                   

 

The redemption of certain borrowings is indexed to stock exchange indexes (historical value : 1,129 million). All such borrowings are hedged in full through swap operations.

 

Page 24