European Investment Fund's AAA rating explained

A credit analysis by Moody's has cited the European Investment Fund's strong capitalisation, ample liquidity and its support from highly-rated shareholders as reasons for its AAA rating.

Moody's, a provider of credit ratings, research and risk analysis, has released the credit analysis for the European Investment Fund citing why it has its Aaa rating.

The European Investment Fund, which is based in Luxembourg, is owned by various EU institutions including the European Investment Bank and the European Union. Moody's credit analysis states that it is its strong capitalisation, ample liquidity and its support from highly-rated shareholders that underpin its Aaa rating.

Thorsten Nestmann, vice-president, senior analyst and author of the report, said: "The European Investment Bank is resilient to highly stressed scenarios and maintained its stable outlook through the euro area debt crisis. It has a very strong capital position, a very prudent liquidity policy and high-performing development-related assets."

The report does warn that the European Investment Banks rating could be reduced if the Euro area sovereign debt crisis were to re-escalate.

To date the European Investment Bank has generated a profit in all but two years since it was established in 1994.

The full Moody's credit analysis can be accessed by subscribers to Moody's on their website.

See more from this Government Report: European Investment Fund


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