CEB and ESM sign Memorandum of Understanding

9 December 2014

PARIS - The Council of Europe Development Bank (CEB) and the European Stability Mechanism (ESM) signed today in Paris a bilateral Memorandum of Understanding (MoU). For both the CEB and the ESM, this is the latest in a series of bilateral cooperation agreements with other International Financial Institutions.

The MoU signed by CEB Governor Rolf Wenzel and ESM Managing Director Klaus Regling will create a framework for collaboration through informal consultation, the sharing of information on planned activities, the provision of technical assistance, and staff exchanges through secondment. The Memorandum does not constitute a commitment to provide financial support to each other.  

Commenting on the agreement, Governor Wenzel said: “I am pleased that through this Memorandum of Understanding the CEB and the ESM are formalising their cooperation and exchange of expertise and good practices, which will be beneficial to all CEB member States.”

Mr. Regling added: “The ESM and CEB have had friendly and productive relations, which will become even more effective thanks to this MoU. Our institutions will particularly benefit from mutual technical assistance that will allow us to share our experience and expertise.”CEB and ESM sign Memorandum of Understanding

Set up in 1956, the CEB (Council of Europe Development Bank) has 41 Member States. Twenty-two Central, Eastern and South Eastern European countries, forming the Bank's target countries, are listed among the Member States. As a major instrument of the policy of solidarity in Europe, the Bank finances social projects by making available resources raised in conditions reflecting the quality of its rating (Aaa with Moody's, outlook negative, AA+ with Standard & Poor's, outlook stable and AA+ with Fitch Ratings, outlook stable). It thus grants loans to its Member States, and to financial institutions and local authorities in its Member States for the financing of projects in the social sector, in accordance with its Articles of Agreement.

The European Stability Mechanism (ESM) is an inter-governmental institution founded by the 18 euro area Member States which was inaugurated on 8 October 2012. Its mandate is to preserve financial stability of Europe’s Economic and Monetary Union by providing financial assistance to euro area Member States in difficulty. In order to fulfil its mission, the ESM is authorised to issue bonds or other debt instruments on the market to raise funds needed to provide loans to countries in financial difficulties, intervene in the debt primary and secondary markets, act on the basis of a precautionary programme and finance recapitalisations of financial institutions through loans to governments. All financial assistance to Member States is linked to appropriate conditionality.