Governing Board approves Report of the Governor 2020

19 April 2021

PARIS - The Governing Board of the Council of Europe Development Bank (CEB) approved on 16 April the Report of the Governor and the CEB’s financial statements for the year 2020.

During the first year of the implementation of the Development Plan 2020-2022, the CEB stepped up to the challenges created by the COVID-19 pandemic through a significant increase in financing operations that resulted in record level of activity. The Bank met and exceeded its objectives, confirming its commitment to inclusive growth and support to the most vulnerable across Europe.

The CEB’s performance highlights at year-end 2020 include:

  • € 6.0 billion of projects approved in 24 countries, a substantial acceleration in lending activity with 56 projects (compared to 46 in 2019), contributing to a record level in the stock of projects which reached € 9.5 billion compared to 2019 (+11.7%). 
  • COVID-19-related projects accounting for 52% of the financing approved, demonstrating the CEB’s responsiveness to member states’ demand triggered by the COVID-19 pandemic.
  • A sharp increase of loan disbursements to € 4.5 billion in 2020, up 56.5% compared to 2019, which generated a significant rise in loans outstanding to € 17.4 billion (+13.0%).
  • A € 90 million contribution to the CEB from the EU Facility for Refugees in Turkey (FRiT) to address the needs of refugees and host communities in Turkey through FRiT-funded project Strengthening Healthcare Infrastructure for All (SHIFA).
  • Successful funding activity with € 5.4 billion raised on international capital markets, including two COVID-19 Response Social Inclusion Bond issuances of EUR 1 billion in April and USD 500 million in June.
  • CEB’s membership expanded with the accession of Andorra as 42nd member state.

In 2020, as part of its core social mandate, the CEB helped mitigate the consequences of COVID-19 with a focus on public social infrastructure, municipal investments, job preservation in micro-, small and medium-sized enterprises, and support to vulnerable populations.

The CEB also continued to strengthen its cooperation with other international organisations and peer multilateral financial institutions in the course of 2020 to promote alignment with sustainable finance principles.

Through active partnerships with donors, the Bank raised for its fiduciary activity additional funds from 28 member states and two non-CEB member countries – the United States and the United Kingdom – for the benefit of disadvantaged populations and regions. The EU remained a privileged partner and CEB’s main donor, with additional pledges for the Regional Housing Programme (RHP) – the Bank’s flagship grant-based programme – also supported by the Czech Republic, Norway and Spain.

The CEB’s financial performance was driven by its strong capacity to face the economic challenges imposed by the COVID-19 pandemic and its prudential risk management; all financial ratios were well within their defined limits throughout 2020. In this difficult financial context, the net profit for the financial year 2020 amounted to € 74.8 million, compared to € 104.7 million in 2019 (-28.5%), due to the adverse market conditions in which the Bank operates. Core earnings (excluding IFRS-related valuation of financial instruments and cost of risk) amounted to € 85.7 million (2019: € 102.1 million). The entire net profit was apportioned to the Bank’s general reserves. The CEB’s equity rose to € 3 132.2 million at year-end 2020 compared to € 3 088.8 million at year-end 2019 (+1.4%).

The quality of the CEB’s strong credit and operational profile was acknowledged by the leading credit rating agencies [1]. Its sound performance with respect to non-financial environmental, social and governance factors was recognised by ESG rating agencies [2].

While the COVID-19 pandemic set a complex operational context, the CEB’s solid performance in 2020 was driven by its strong resilience in a challenging environment, showcasing its influential role in the European financing architecture. 

Key figures

Key figures 2020

[1] Standard & Poor’s affirmed the CEB’s ‘AAA’ rating with a “stable” outlook on 6 July 2020, and Scope Ratings assigned a new AAA rating with a “stable” outlook (unsolicited) to the CEB on 2 October 2020. Fitch Ratings revised its rating outlook from “positive” to “stable” and affirmed the Bank’s AA+ rating on 29 July 2020. Moody's affirmed its Aa1 rating with a“stable” outlook on 6 July 2020.

[2] In 2020, the CEB obtained the ‘advanced’ ESG performance level by Vigeo Eiris, as well as ‘Prime’ by ISS ESG, ‘Leader’ by MSCI ESG and ‘Negligible ESG Risk’ by Sustainalytics.

Set up in 1956, the CEB (Council of Europe Development Bank) has 42 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 (Aa1 with Moody's, outlook stable, AAA with Standard & Poor's, outlook stable, AA+ with Fitch Ratings, outlook stable and AAA* with Scope 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.