BREXIT: European Investment Bank to continue to lend to UK infrastructure projects

Out-Law News | 28 Jun 2016 | 10:47 am | 1 min. read

The European Investment Bank (EIB) will continue to lend money to UK infrastructure projects until a decision is made by other member states on the UK's shareholding in the bank.

This is part of Out-Law's series of news and insights from Pinsent Masons experts on the impact of the UK's EU referendum. Watch our video on the issues facing businesses and sign up to receive our 'What next?' checklist.

The UK is one of the main shareholders in the EIB, with a 16.11% shareholding, according to a statement by the bank

A country must be a member state of the EU to become a shareholder in the EIB, but any change to the existing shareholder structure is "a decision for the member states", the bank said.

"At present the UK shareholding in the EIB remains and the EIB's engagement in the UK is unchanged," it said.

"We expect that the EIB’s shareholders, the 28 EU member states, will discuss the EIB’s engagement in the UK as part of broader discussions to define the future relationship of the UK with Europe and European bodies. At present, the EIB’s shareholders have not requested the bank to change its approach to operations in the UK," it said.

"It is premature to speculate on the impact of the referendum result on the EIB, including the bank’s future relationship with the UK government and its future engagement to support long-term investment in the UK without clarity on the timing, circumstances and conditions of a withdrawal settlement," the bank said.

The EIB approved €3 billion in new financing for 17 projects across Europe last week, including clean transport and energy initiatives.

The projects are backed by the EU budget guarantee under the European Fund for Strategic Investments (EFSI).

The EFSI was established last year by the EIB as a joint initiative of the European Commission and the EIB. It will manage a guarantee from the EU budget of €16bn and an EIB contribution of €5bn to trigger private and public investment of €315bn.