About the EIF - EIF Annual Report 2023 (2024)

Austria - 21

UniCredit Bank Austria AG - 8

Raiffeisen Bank International AG - 7

Erste Group Bank AG - 5

Austria Wirtschaftsservice Gesellschaft mbH (aws) - 1

Bulgaria - 5

Bulgarian Development Bank AD (BDB) - 5

Croatia- 13

Croatian Bank for Reconstruction and Development (HBOR) - 13

Czech Republic - 5

Národní rozvojová banka, a.s. - 5

Denmark - 8

Danmarks Eksport- og Investeringsfond - 8

France - 175

Bpifrance Participations - 167

BPCE - 8

Germany - 238

KfW Bankengruppe - 167

NRW.BANK - 20

LfA Förderbank Bayern - 18

Landeskreditbank Baden-Württemberg Förderbank (L-Bank) - 13

Sächsische Aufbaubank - Förderbank (SAB) - 10

ProCredit Holding AG - 5

Bürgschaftsbank Baden-Württemberg GmbH - 5

Greece - 3

National Bank of Greece S.A. (NBG) - 3

Hungary - 5

MFB Hungarian Development BankPrivate Limited Company - 5

Ireland - 10

Strategic Banking Corporation of Ireland Designated Activity Company (SBCI) - 10

Italy- 87

Cassa Depositi e Prestiti S.p.A. (CDP) - 82

Intesa Sanpaolo S.p.A. - 5

Luxembourg - 13

Banque et Caisse d’Epargne de l’Etat, Luxembourg (BCEE) - 13

Malta - 24

Bank of Valletta p.l.c. - 24

Poland - 8

Bank Gospodarstwa Krajowego (BGK) - 8

Portugal - 15

Caixa Geral de Depósitos S.A. - 8

Banco Português de Fomento, S.A. - 4

Banco BPI S.A. - 3

Slovenia - 25

SID banka, d.d., Ljubljana - 25

Spain - 91

Instituto de Crédito Oficial (ICO) - 49

Banco Santander, S.A. - 33

Nuevo MicroBank, S.A.U. - 5

Agencia de Innovación y Desarrollode Andalucía (IDEA) - 4

The Netherlands - 5

Invest-NL N.V. - 5

Turkey - 13

Industrial Development Bank of Turkey (TSKB) - 8

Technology Development Foundation of Turkey (TTGV) - 5

United Kingdom - 10

Barclays Funds Investments Limited (BFIL) - 5

Scottish Enterprise - 5

Chair

Gelsomina VIGLIOTTIVice-President, European Investment Bank, Luxembourg

Members

Filipe CARTAXO1Independent Director

Giorgio CHIARION CASONI2

Director, Directorate L, InvestEU and financial institutions, Directorate- General for Economic and Financial Affairs, European Commission, Luxembourg

Merete CLAUSENDirector, Directorate C, Investment, Directorate- General for Internal Market, Industry, Entrepreneurship and SMEs, European Commission, Belgium

Ambroise FAYOLLEVice-President, European Investment Bank, Luxembourg

Ludivine HALBRECQ3Advisor, Administration of International & European Financial Affairs, Treasury - Federal Public Service Finance, Belgium

Pascal LAGARDEExecutive Director in charge of International Affairs, Strategy, Development and Research, Bpifrance Participations, France

Alternates members

Peter BERKOWITZDirector, Directorate B, Policy, Directorate-General for Regional and Urban Policy, European Commission, Belgium

Armands EBERHARDS Deputy State Secretary, Ministry of Finance of the Republic of Latvia

Werner HOYER4President, European Investment Bank, Luxembourg

Jean-Christophe LALOUXDirector General, Head of Operations, European Investment Bank, Luxembourg

Anna PANAGOPOULOUDirector, Directorate A, ERA & Innovation, Directorate- General for Research and Innovation, European Commission, Belgium

Kristina SARJOFinancial Counsellor, Director of Unit for International Financial Affairs, Ministry of Finance, Finland

Mark SCICLUNA BARTOLIExecutive - Product Management and Development, Business Banking, Bank of Valletta, Malta

Executive management

Marjut FALKSTEDT

Chief Executive

Roger HAVENITHDeputy Chief Executive.

Directors

Alessandro TAPPIChief Investment Officer, Head of Equity Investments and Guarantees

Nicolas PANAYOTOPOULOSSecretary General

Rebecca LEHMANNChief People Officer

Thomas KUSSTATSCHERChief Risk Officer

Markus SCHILLOChief Strategy Officer

Chair

Georgiana VAN ROMPUY

Assistant to the Director-General, Internal Audit Service, European Commission, Belgium

Members

Jacek DOMINIKGeneral Counsel, Ministry of Finance, Poland

Isabelle GOUBIN5Independent Director

Rossella LOCATELLI6Full Professor in Banking and Finance, Department of Economics, University of Insubria, Italy

Delphine REYMONDON7Head of Liquidity, Leverage, Loss Absorbency and Capital Unit, European Banking Authority, France

Sergio SIERRAHead of Funding and Treasury, Instituto de Crédito Oficial, Spain

1. Filipe CARTAXO was appointed as member of the Board of Directors by decision of the General Meeting dated 2 November 2023, to complete the term of office of Marinela PETROVA, following her resignation from the Board of Directors, effective 13 July 2023, in connection with her resignation from the EIB’s Board of Directors.

2. Giorgio CHIARION CASONI was appointed as member of the Board of Directors by decision of the General Meeting dated 6 November 2023, to complete the term of office of Markus SCHULTE, following his resignation from the Board of Directors, effective 20 September 2023, in connection with a change of responsibilities within the European Commission.

3. Ludivine HALBRECQ was appointed as member of the Board of Directors by decision of the General Meeting dated 2 November 2023, to complete the term of office of Marc DESCHEEMAECKER, following his resignation from the Board of Directors, effective 15 November 2022, in connection with his resignation from the EIB’s Board of Directors.

4. Werner HOYER resigned from the Board of Directors, effective 31 December 2023, following also the end of his mandate as President of the EIB. By decision dated 22 February 2024, the General Meeting appointed EIB President Nadia CALVIÑO as alternate member to conclude the remaining term of office.

5. Further to the enhanced composition of the Audit Board, as approved by the General Meeting on 27 September 2022, Isabelle GOUBIN was appointed as member of the Audit Board by decision of the General Meeting dated 24 April 2023.

6. Further to the enhanced composition of the Audit Board, as approved by the General Meeting on 27 September 2022, Rossella LOCATELLI was appointed as member of the Audit Board by decision of the General Meeting dated 11 January 2023.

7. Further to the enhanced composition of the Audit Board, as approved by the General Meeting on 27 September 2022, Delphine REYMONDON was appointed as member of the Audit Board by decision of the General Meeting dated 11 January 2023.

The EIF is characterised by a multi-layered control environment embedded in the EU institutional framework and aligned with the financial sector’s principles and best practices.

The EIF’s first layer of control is exercised through internal processes and procedures developed and implemented by the Executive Management by means of financial and operational controls designed to enable effective and efficient day-to-day operations, ensure reliable financial reporting, compliance with applicable rules and policies and achieve the EIF’s objectives.

In this context, the EIF’s procedural and organisational framework sets out the competences, authorities and reporting lines within the EIF, with a view to ensuring segregation of duties both horizontally, through the interaction between front office, middle office and back-office services and vertically, through central control by the Board of Directors of the decision-making process in relation to all business activities.

The second layer of control consists of independent risk and compliance functions, which implement an ex-ante risk assessment and reporting framework for each transaction proposed for approval, complemented by ex-post risk monitoring where relevant (see sections on Risk Management and Legal Service).

The EIF maintains an Internal Control Framework (ICF) and produces an ICF report annually. The ICF relies in particular on a risk control matrix outlining the main risks to which the EIF is exposed. Through the ICF, the Executive Management is in a position to obtain the necessary comfort that key risks related to the EIF’s business activities are properly identified, that control objectives are defined, that key risks are mitigated and that the controls designed to achieve these objectives are in place and are operating effectively.

Each year the ICF is complemented with an independent opinion from an external audit firm on the design and effectiveness of the key controls of the mandate-related processes throughout the year, in line with the internationally recognised ISAE-3402 standard (type 2 report).

The ICF and the ISAE-3402 reports form the basis for the confirmation by the Chief Executive to the Audit Board that the main risks have been identified and mitigated throughout the reporting period.

The risks, control objectives and agreed improvements described in the ICF are reviewed by Internal Audit, which, on the basis of the audits and the follow-up on agreed action plans performed, expresses an opinion on the achievement of the control objectives in the audited areas and on the design and effectiveness of the related internal controls.

The third and fourth layer include internal and external audit activities that are coordinated by the Audit Board. The Audit Board, as an oversight and controlling body, conducts its activity in accordance with the standards of the audit profession and relies on both internal and external audit assurances in order to confirm annually that, to the best of its knowledge and judgement, the operations of the EIF have been carried out in compliance with the Statutes and the Rules of Procedure and that the financial statements give a true and fair view of the financial position of the EIF as regards its assets and liabilities and of the results of its operations for the financial year under review. This information is included in the annual report submitted by the Board of Directors to the EIF’s Annual General Meeting. Additionally, as of 2023, the Audit Board is also statutorily tasked with verifying that the EIF’s activities are based on sound banking principles or other sound commercial principles and practices as applicable.

In order to discharge its duty in relation to the financial statements, the Audit Board may have recourse to external auditors. The audit of the financial statements of the EIF for the year ending 31 December 2023 was carried out by KPMG Luxembourg, as external auditor.

KPMG performs its audits in accordance with the International Standards on Auditing (ISA) and is committed to informing the EIF Executive Management and the Audit Board of any material weaknesses in the design or implementation of internal controls over financial information that come to its attention during the audit of the financial statements. While performing the audit of the annual accounts, KPMG is acting independently, fulfilling the duty imposed on it by the Code of Professional Ethics adopted in Luxembourg by the Commission de Surveillance du Secteur Financier (CSSF).

Internal Audit (which is outsourced to EIB Internal Audit) examines and evaluates, on an independent and objective basis, the relevance, design and effectiveness of the internal control systems and procedures within the EIF.

To that end, a yearly audit plan covering all key processes of the EIF, including those to be assessed at EIB Group level, is established, on the basis of a risk-assessment methodology, in alignment with the ICF. The plan is discussed with the Executive Management and the external auditor prior to being submitted to the Audit Board for approval.

In line with the Internal Audit Charter, Internal Audit examines the EIF’s activities in order to support the Executive Management’s statement on the design and effectiveness of internal controls, risk management and administration. Internal Audit reports on its findings by means of recommendations and agreed action plans to improve the EIF’s control and working procedures.

The Head of Internal Audit reports regularly on the execution of the internal audit programme to the Executive Management, the Audit Board and the Chairman of the Board of Directors. Internal Audit adheres to the professional and ethical guidance issued by the Institute of Internal Auditors and the Information Systems Audit and Control Association and is subject to a regular quality assurance and improvement programme that covers all aspects of the internal audit activity. Moreover, Internal Audit shall comply with the internal policy statements governing their actions.

In addition to the maintenance of an internal control environment in line with the highest standards of the financial and banking sector, the EIF is subject to periodic reviews by independent control bodies such as the European Court of Auditors (ECA), the Internal Audit Service of the EC and national or regional authorities entrusted with the task of monitoring the correct utilisation of funds under the relevant rules and within their respective remits.

The EIB has established the Review and Evaluation Process (REP), which is based on the EBA Guidelines on Supervisory Review and Evaluation Process, while taking into account the EIB’s nature, policy mission, specific tasks and governance structure. The REP team assesses risks emanating from the EIF whenever these are deemed material from a consolidated EIB Group point of view, addressing findings and recommendations to management for follow up and implementation of relevant actions by services within agreed timelines. As part of its general review plan over the EIB Group, in 2023, the REP team reviewed selected EIF-relevant risks under the consolidated umbrella.

The risk management function at the EIF is integral to the organization’s mission, supported through a robust and solid approach to ensure the EIF’s sustainability from a risk point of view. The overarching goal of the EIF risk management framework is to secure the highest possible credit rating from major external credit rating agencies. In essence, the risk management function is a strategic and proactive process aimed at identifying, assessing, and mitigating potential risks that could impact the EIF’s operations.

The EIF has an internal Risk Management Framework that covers financial and non-financial risks. To apply effective risk management techniques and to maintain adequate capitalisation and a solid liquidity position, EIF Risk Management has defined specific key risk indicators that are monitored on a regular basis, and performs an ICAAP, an ILAAP and a standalone capital plan which, in the scope of consolidation at EIB Group level, all contribute to the Group documents, such as the Group ICAAP and ILAAP, the Group Risk Appetite Framework and the Group Capital Plan under the lead of the Group Chief Risk Officer.

EIF Risk Management has a complete range of processes and procedures in place that allow for a sound risk assessment of its operations and mandates as well as the monitoring of its portfolio, providing analysis on a regular basis to the relevant committees and senior management. In addition, a solid capital management framework allows to ensure the institution capital sustainability in line with EIB Group policies.

The EIF risk reporting framework provides regular reporting to top management on current and future risks by including a forward-looking perspective and with a clear risk appetite limit setting, allowing for decision making in a timely manner.

In the area of environmental and social sustainability, Risk Management has developed a framework which is implemented in its operations and includes visibility of the impact of investments, contributing to the Group SDG report.

Finally, EIF Risk Management continues to enhance the EIF Risk Appetite Framework and Risk Appetite Statement by implementing methodological enhancements on a regular basis, increasing the consistency with the EIB Group, when necessary, in adherence with best banking and best market practices.

Under the terms of its Compliance Charter, the Compliance function assesses - in line with best market practices and in line with the EIB Group’s policy framework – the institutional, transactional and ethical aspects of the EIF’s compliance risk.

The principles of permanence and independence are included in the EIF Compliance Charter and materialise through the unrestricted direct access of the Chief Compliance Officer to the Chief Executive, the Deputy Chief Executive, the Board of Directors and the Audit Board.

The EIF’s compliance risk assessment strives to protect the institution, notably against risks that could have an adverse effect on its reputation.

The compliance risk assessment in the transactional area follows a risk-based approach and is reflected in the independent compliance opinion provided to the EIF decision-making bodies. It is implemented through compliance risk scorings provided in the compliance opinions, in particular on the risk of the EIF being involved (or used) in money laundering and terrorism financing cases, and tax avoidance schemes.

Specific compliance risk assessments and applicable monitoring activities are established and performed for market abuse, conflicts of interest and conduct topics.

The Compliance Function provides training and raises awareness on compliance matters and implements the EIB Group Staff Code of Conduct and Whistleblowing Policy with a view to instilling a culture of integrity throughout the EIF. As such, an advisory and decision-making role on ethics and integrity issues is ensured through the provision of opinions and recommendations to support strict compliance with the principles and high standards of professional ethics and integrity.

In line with applicable best banking and market practices, the EIF continues to pursue a number of compliance initiatives across the EIB Group for the purpose of establishing a modern and robust compliance framework, taking into account the interests and specificities of the EIF.

The Data Protection Officer (DPO), by providing regular training to staff and senior management, ensures that the EIF complies with the Regulation EU 2018/1725 on the protection of natural persons with regard to the processing of personal data by the Union institutions and bodies.

Furthermore, the DPO provides regular advice to EIF Services concerning the records of processing activities (RoPA) under their responsibility, the publication of privacy notices on the EIF website, as well as offering the necessary assistance in case personal data breaches have occurred or any notification to the European Data Protection Supervisor is needed.

Concerning the exercise of data protection rights, the EIF enables a direct and easy communication channel with its DPO through a dedicated form available on the EIF website.

The EIF is supported by a strong in-house legal team whose remit, within its area of responsibility, is to pursue the strategic goals and protect and preserve the legal integrity of the Fund. This is achieved through the provision of legal advice based on the expertise and specialist knowledge of the team throughout the lifecycle of all the EIF’s transactional activities and in connection with institutional, strategic and policy-related matters, objectives that are reflected in the legal team’s internal structure.

With regard to transactions, in order to address increasing business volumes and the strategic goal of achieving performance gains through specialisation, the transactions team is split into two divisions, one focused on debt transactions and the other on equity transactions.

The legal service’s transaction teams work on all stages of transaction implementation, including (i) structuring and product development, (ii) review of proposals to the Investment and Risk Committee and the EIF’s Board of Directors, (iii) contractual negotiations and (iv) active portfolio management, in each case in close collaboration with other EIF services.

In terms of institutional and corporate matters, the legal service supports the implementation of good corporate governance, coordinates and advises on contractual arrangements at institutional level. The legal service aims to ensure that the EIF conducts its activities in accordance with its Statutes, mission and values, applicable law and relevant contractual obligations. It further aims to ensure smooth functioning of the EIF’s corporate bodies, under the coordination of the EIF’s Secretary General.

As a European Union body, a member of the EIB Group and a financial institution, institutional matters concerning the EIF cover a wide range of areas and at times necessitate cooperation with the EIF’s shareholders, as well as specific and proactive attention to the development of EU policy and legislative and governance frameworks.

In addition, the legal service is called upon to advise on numerous structuring, corporate, governance and regulatory matters relating to third party mandates, including external structures (funds-of-funds), for which the EIF acts as manager and/or adviser.

In order to create the necessary interface between the EIF’s institutional role, its mandate management activity and transaction delivery, the activities of the transactions and the corporate and institutional teams are closely coordinated, with the aim of providing seamless advice and expertise across the EIF’s business.

European Investment Fund

37b, avenue J. F Kennedy

L-2968 Luxembourg

Phone +352 2485-1 | Fax +352 2485 81200

info@eif.org

www.eif.org

The EIF also has offices in Athens, Bucharest, Istanbul, Madrid, Rome, Sofia.

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Numbers in the EIF Annual Report are correct as at 31 December 2023 and any references to figures throughout the text apply to the same period unless otherwise stated. EIF’s 2023 figures related to SME outreach and employment including the estimated numbers and sustained jobs are indicative only and are based on reports received from financial intermediaries between 1 October 2022 and 30 September 2023. EIF assumes no liability for the accuracy thereof.

The EIF shall not be held responsible for the use that might be made with the information contained herein. Reproduction is authorised provided the source is acknowledged. For any use or reproduction of photos or other material that is not under the EIF’s copyright, permission must be sought directly from the copyright holders.