Moody's Affirms European Investment Bank's Aaa Ratings Amid Strong Capital and Liquidity Metrics

Strategic Insights -

Moody's Ratings has affirmed the European Investment Bank's (EIB) long-term issuer rating and senior unsecured foreign-currency ratings at Aaa, citing the bank's strong capital and liquidity metrics, prudent and sophisticated risk management, and very strong shareholder support. The stable outlook reflects Moody's view that EIB's financial metrics and shareholder support will remain solid over the coming years.

Key Takeaways:

  • EIB's capital adequacy metrics have remained very robust over the past year, with a leverage ratio of around 606% in 2024, trending down from a peak of 785% in 2015.
  • The bank's credit quality of its development asset portfolio is among the strongest of Aaa-rated peers, with substantial credit protections provided by the European Commission and shareholders.
  • EIB's liquidity metrics are extremely strong, with a solid cushion of highly rated and liquid treasury assets of EUR67.5bn as of end 2024.
  • The bank stands out for its access to central bank liquidity operations and has a highly unusual feature for MDBs, with its risk management framework and practices aligned with best practices for commercial banks.
  • Shareholder support for EIB has been steadfast and solid, with successive capital increases since 2003 and a key role in the EU's response to the Covid-19 pandemic and the implementation of its multi-year InvestEU programme.

Statistics:

  • EIB's leverage ratio was around 606% in 2024.
  • The bank's development asset portfolio had a non-performing asset ratio of 0.2% in the last two decades.
  • EIB's liquidity metrics are supported by a solid cushion of highly rated and liquid treasury assets of EUR67.5bn as of end 2024.
  • The bank's annual issuance volumes are around EUR60bn, on par with many sovereign issuers.
  • EIB's ECOFIN-approved increase in the gearing ratio from 250% to 290% will allow it to lend significantly larger amounts going forward.

Sources:

  • Moody's Investors Service - Moody's affirms Aaa ratings of European Investment Bank (05 May 2025)
  • Moody's - Multilateral Development Banks and Other Supranational Entities (February 2024)