In press interviews last week the European Investment Bank (EIB) explained its negotiating position in respect of the refund of the UK’s capital in the EIB once the UK ceases to be a shareholder on the withdrawal date. Alexander Stubb, vice president of the EIB, was interviewed on BBC Radio 4’s Today programme and Werner Hoyer, the EIB’s president, had a conversation with Handelsblatt, a German business newspaper.

Mr. Stubb, ex-prime minister of Finland, stated that, although the UK will cease to be a shareholder on the withdrawal date, their view is that the UK will remain “married to the EIB” until the loans granted during its time as a shareholder are completely recovered. Many of EIB’s loans have a long tenor, extending to several decades in some cases, so the implication of this would be that it would take until 2054 for Britain to be fully refunded its £3.1 billion capital in the bank.

In the Handelsblatt interview, Mr. Hoyer stated that the loss of the UK’s 16% shareholding may force the EIB to reduce its lending unless the other member states compensate. Additionally, he explained that there has been no decision made on the €36bn non-cash capital provided by the UK, but that the other member states’ proposal is that this could be replaced by a deposit which would need to remain in place until 2054.

Ongoing liabilities post Brexit

As the interviews re-emphasised, withdrawal from the EIB will not be as simple as just ceasing to be a shareholder and cashing out the UK’s share. The situation is complex because the durations of many current and pre-Brexit pipeline investments extend past the UK’s withdrawal date. In its June paper titled “Essential Principles on the Financial Settlement”, the EU’s Brexit task force stated that, although the UK would cease to be a member on withdrawal from the EU, their negotiating position is that the UK’s liability should continue in respect of all guarantees made while it was a member state, decreasing in line with the amortisation of the EIB portfolio (as in place on the withdrawal date). Only once this liability is extinguished will the paid-in capital be reimbursed.

Given the substantial profits of the EIB, the UK may try and negotiate that, in addition to the refund of its capital, accumulated profits should be paid – it has been estimated in a House of Lords report that, based on the current net worth of the EIB, the UK may be due a share of equity of approximately €10bn.


The United Kingdom is one of the four largest shareholders in the EIB who each provide just over 16% of the EIB’s capital and guarantee that proportion of its global financing. In 2016, the EIB’s overall annual lending was over €76bn.

In the UK, total investment by the EIB and its offshoot the European Investment Fund in 2016 was €8.1 billion. The EIB invests primarily in infrastructure assets and examples of its projects in the UK include the Thames Tideway Tunnel, offshore windfarms, roads, rail and hospitals.

The EIB was established by the Treaty on the Functioning of the European Union: this agreement also states that the EIB’s members are solely the EU member states and therefore the United Kingdom will cease to be a shareholder of the EIB once it is no longer a member state.