The FINANCIAL — A powerful financial performance in 2016 has helped the EBRD prepare for another strong year of investment in its continued drive to make a positive impact on the economies of the 36 countries where it is active.
The Bank is expected to announce a net profit of approximately €1 billion in 2016, nearly double the average annual profit over the last 10 years of €534 million and a rise of some 25 per cent from the €802 million posted in 2015.
“These robust financial returns ensure that the EBRD is well equipped to continue its high level of investment in the coming years,” said EBRD Senior Vice President, Chief Financial Officer and Chief Operating Officer András Simor.
The strong financial performance coincided with another year of record investment, with the Bank financing 378 projects worth €9.4 billion, matching the 2015 level, according to EBRD.
The EBRD continued to report robust capital strength in 2016, despite difficult market conditions. The average return on equity over the last five years stands at 5.5 per cent. The Bank’s non-performing loan ratio eased to 5.5 per cent at the end of 2016 from 5.9 per cent a year earlier.
The institution’s capital strength is further underpinned by its AAA rating with a stable outlook affirmed by all three major rating agencies in 2016.
The EBRD stepped up its investments in 2016 in key strategic areas where it can make an important impact. It carried out 93 local currency projects in 2016 compared with 80 a year earlier. It also maintained a strong level of investment in small businesses, which are seen as key to ensuring underlying economic strength and providing job opportunities.
The EBRD increased the number of its projects in countries that still face the most significant transition challenges, to 114 operations in 2016 from 102 a year earlier.
Reflecting the implementation of its Green Economy Transition approach, the share of environmental financing rose to 33 per cent from 31 per cent of total annual investment. This financing included projects in energy efficiency, renewable energy, climate resilience and resource efficiency.
As it continued to reach out across the societies of its countries of operations, the Bank made progress with gender programmes, increasing its financing for gender-oriented projects to 29 operations in 2016 compared with 23 in 2015.