EIB cut lending by 20%, prepares for Brexit
The European Investment Bank cut lending by nearly 20% last year and plans to keep financing at a similar level in 2019 at around €60 billion.
The bank is also preparing for all Brexit outcomes, including Britain's departure without a deal in March. Plans are in place for the other 27 EU states to plug the capital gap caused by Britain's departure, even in the event of a no-deal Brexit that would create a sudden shortfall without any transition period, president Werner Hoyer said.
Hoyer said 2018's decrease in lending was due to improved economic conditions in the EU which allowed the bank to invest less and concentrate on riskier and more profitable projects.
Britain's departure from the bloc will deprive the bank of one of its largest shareholders and of €3.5 billion of British paid-in capital and €35 billion of UK callable capital which are key for the bank to maintain its triple-A rating and low funding costs.
The gap in the paid-in capital will be covered with the bank's reserves, Hoyer said, while the hole in the callable capital would be filled proportionally by the 27 remaining governments of the EU.
