About the EIB

Basic facts

Set up in 1957 under the Treaty of Rome, which established the European Economic Community (later the European Union), the European Investment Bank is the house bank of the European Community.  The EIB is headquartered in Luxembourg with an increasing number of regional offices set up in recent years.

With more than EUR 52 billion of approved loans in 2012 the EIB is also one of the biggest international public financial institutions operating globally. Around 90% of its loans take place within the EU, while the remaining 10% are directed to countries outside of the European Union. In the recent years and following a decision by the European Council to increase its capital, the EIB has played an important macroeconomic role in the EU and increased its visibility.

The EIB is financed by the EIB’s shareholders – the 28 member states of the European Union that jointly provide the EIB’s subscribed capital (around EUR 243 billion), underwriting its investments. Due to the fact the EIB is owned by the EU member states, which contribute to and guarantee its capital, the EIB is rated as a very solid financial partner and receives AAA rate from rating agencies. It is this that permits the EIB to undertake work on the financial markets such as borrowing and floating bonds, and which generates most of its liquidity.


The governance structure of the EIB consist of three decision making bodies:

The Board of Governors comprises Ministers designated by each of the 28 Member States, usually Finance Ministers. It lays down credit policy guidelines, approves the annual accounts and balance sheet, and decides on the Bank’s participation in financing operations outside the European Union as well as on capital increases. It also appoints the members of the Board of Directors, the Management Committee and the Audit Committee.

The Board of Directors has sole power to take decisions in respect of loans, guarantees and borrowings. As well as seeing that the Bank is properly run, it ensures that the Bank is managed in keeping with the provisions of the Treaty and the Statute and with the general directives laid down by the Governors. The Board of Directors consists of 29 Directors, with one Director nominated by each Member State and one by the European Commission. There are 19 Alternates, meaning that some of these positions will be shared by groupings of States.

The Management Committee is the Bank’s permanent collegiate executive body. It has nine members. Under the authority of the President (currently Werner Hoyer) and the supervision of the Board of Directors, it oversees the day-to-day running of the EIB, prepares decisions for Directors and ensures that these are implemented. The President chairs the meetings of the Management Committee. The members of the Management Committee are responsible solely to the Bank; they are appointed by the Board of Governors, on a proposal from the Board of Directors, for a renewable period of six years.

An unusual creature 

As a body of the European Union, the EIB states that its mission is to further the objectives of the EU by ‘making long-term finance available for sound investment’. This suggests that at least two principles should be at the core of the EIB’s lending policies. The first is that of meeting EU objectives, which more and more revolves around promoting sustainable development inside the EU and out. The second is that of additionality: the EIB should use its resources to arrange loans for projects that although financially and socially viable, have associated risks that make them unappealing to more commercial lenders. In other words, to make worthy projects happen that otherwise would not happen. The EIB consistently fails to deliver on either of the two obligations.

The European Investment Bank is a very strange animal indeed: a public bank that tends to act as a private lending institution, which gets the benefits of public support, its own legal personality and autonomy within the Community system, without paying the price of accountability or of binding operating standards. The EIB grants loans mainly from the proceeds of its borrowings which, together with ‘own funds’ (paid-in capital and reserves), constitute its ‘own resources’. Yet the EIB’s legal status and its obligations with respect to the EU have never been properly clarified. Rightly treated as a European body, the EIB is subject to European law. It is legally bound to act within the limits of the EC Treaty and its own statute, and it is also obligated to adhere to EU development goals and objectives. However, while the EIB should only operate within the boundaries of EU policy and laws, there is confusion over how exactly it can be held responsible with regard to these laws, and made accountable for its failures to abide by relevant laws, policies and regulations.

Equally problematically, the EIB is alone among the major International Financial Institutions (IFIs) that fund development projects in the Global South in having no binding formal environmental and social standards for the projects it supports. This causes a whole range of problems: lack of accountability and transparency over decisions, major problems in mitigating damage to local ecosystems and economies, difficulties for affected people to ensure they receive benefits and overwhelmingly econometric decision-making. As an institution, it is fair to say that the EIB is primarily set up to make loans on the basis of a simplistic ‘bottom-line’ growth ideology, and lacks the capacity and inclination to properly consider wider environmental and social consequences.

You will find on our website more detailed information and evidence about the problems currently associated with the EIB operations.

The EIB’s website provides more information regarding:

Counter Balance has produced the ‘Citizen’s guide’ and the ‘Parliamentarian toolkit’ providing more information on how the bank operates.