International Investment Bank

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International Investment Bank

Type	International financial organization
Founded	July 10, 1970 (1970-07-10)
Headquarters	Budapest, Hungary
Key people	Nikolay Kosov (Chairperson)
Total assets	EUR 1720 million
Total equity	EUR 2 billion (paid in capital EUR 378,71 million)
Parent	Comecon (1970–1991)
Website	www.iib.int/en

International Investment Bank (IIB) is a multilateral development institution with headquarters in Budapest, Hungary. It was established in 1970 and operates as an international organisation based on the intergovernmental Agreement Establishing the International Investment Bank dated 10 June 1970, registered with the United Nations Secretariat on 1 December 1971 under number 11417, as amended and restated from time to time. IIB specialises in medium- and long-term financing of projects aimed at supporting the economies of its members that would have a significant positive social, economic and environmental impact. The Bank offers direct financing and provides loans in partnership with other financial institutions as well as through partner banks.

Member states[]

Current members[]

•  Bulgaria
•  Cuba
•  Czech Republic
•  Hungary
•  Mongolia
•  Romania
•  Russia
•  Slovakia
•  Vietnam

Former members[]

•  Czechoslovakia (1970-1993)
•  East Germany (1970–1990)
•  Poland (1970–2000)
•  Soviet Union (1970-1991)

The IIB statutory documents allow for the admission of either sovereign states or international organisations as members.

Management[]

The Board of Governors is the Bank’s supreme collective governing body, consisting of representatives from the IIB’s member states. The Board of Directors is responsible for the general management of the Bank. The Bank’s executive body is the Management Board, whose members are appointed by the Board of Governors. The Bank’s activities are controlled by the Audit Committee, which is made up of representatives from the IIB’s member states appointed by the Board of Governors. The Bank’s financial statements are confirmed by a half-year compliance audit review and an annual audit conducted by international auditors EY.

Capital[]

The authorized capital of the Bank is EUR 2 billion.

The paid-in capital of the Bank is EUR 378.71 million.

Ratings[]

IIB is one of the highest rated entities across its operating regions with an average A- rating by international rating agencies.

• Moody's: "A3"
• Fitch: "A-"
• S&P Global Ratings: "A-"

The key factors behind IIB credit ratings are: a high level of support from member states; a stable liquidity situation; high capital adequacy; diversified financing sources and an improved risk management system.

History[]

Soviet era[]

The agreement establishing the IIB was signed by the member states on July 10, 1970 and registered with the UN Secretariat under number 11417. The Bank began its activities on January 1, 1971. The member states of the Bank at the time of its foundation were: the People's Republic of Bulgaria, the People's Republic of Hungary, the German Democratic Republic, the Mongolian Democratic Republic, the People's Republic of Poland, the Socialist Republic of Romania, the Union of Soviet Socialist Republics, and the Czechoslovak Socialist Republic.

The IIB's key objective at that time was granting long-term and medium-term loans for implementation of joint investment projects and development programs and providing financing to construct facilities contributing to development of the national economies of the IIB member states. During the ‘Soviet’ period of its history, the Bank financed more that 200 investment projects in the amount exceeding EUR 7 billion.

Post communist era[]

With the disintegration of the Socialist Bloc, the IIB largely lost its purpose and stagnated for nearly two decades. In 1991, the German Democratic Republic (GDR) terminated its membership in the Bank, as the GDR ceased to exist as an international entity. In 2000, Poland and Hungary declared their intentions to cancel their membership in the Bank (Hungary rejoined the IIB in May 2015).

In 2012 IIB shareholders unanimously decided to fully reboot the Bank’s activities and approved a relaunch strategy. A new team of international professionals was entrusted to implement it. The process was completed in 2018 with IIB transforming into a modern multilateral development bank recognized by the international financial community. Throughout the period of relaunch maximum efforts were undertaken by the Bank to build internal competences. New risk management, compliance and, finally, corporate governance systems were put in place correspondent to best practices of international financial organisations.

In 2019, IIB relocated its headquarters to Budapest, Hungary.<ref>

References[]

External links[]

• Official website