Press release
Minister McGrath confirms Ireland’s commitment to subscribe to the Council of Europe Development Bank’s capital increase
Published on
Last updated on
Published on
Last updated on
Following approval by cabinet today, the Minister for Finance Michael McGrath will confirm Ireland’s commitment to subscribe to the Council of Europe Development Bank’s (CEB) capital increase.
On 2 December, the Council of Europe Development Bank’s Governing Board approved an overall capital increase of €4.25 billion. This Capital increase will provide the Bank with the necessary resources to commence operations in Ukraine while continuing to provide support to existing Member States including Ireland.
Apart from the European Investment Bank (EIB), the CEB is the only other Multilateral Development Bank that provides financing to Ireland and was one of the founding funders of the Strategic Banking Corporation of Ireland (SBCI). Over the past decade, Ireland has availed of €900 million in loans from the bank to Local Authorities and financial intermediaries such as the Housing Finance Agency and Social Finance Foundation.
In confirming Ireland’s commitment to subscribe to the CEB Capital Increase, Minister McGrath said:
“Solidarity and social inclusion are essential values of the European Union which are fostered by the work of the CEB and in the context of growing demands for support to Ukraine and neighbouring countries, I am pleased to confirm our support of this capital increase."
CEB Governor Carlo Monticelli said:
“We are grateful to Minister McGrath and the Irish Government for today’s decision. Almost a year after our landmark Joint Meeting in Dublin at which Ireland inspired the launch of a Ukraine Solidarity Fund, Ireland is again leading by example in supporting the CEB’s mission to advance social cohesion and the Bank’s ability to deliver critical social investment at a pivotal time for Europe."
The Council of Europe Development Bank (CEB) is a Multilateral Development Bank with an exclusively social mandate. Known originally as the Council of Europe Resettlement Fund until 1999, the CEB was set up in 1956 in order to provide solutions to the problems experienced by refugees. The Bank’s mandate remains very relevant today in the context of supporting the millions of Ukrainian citizens displaced by the brutal and unjust war in Ukraine.
Following the Russian invasion of Ukraine, the CEB has approved almost €6.9 million in grants from its Migrant and Refugee Fund to the offices of the International Organization for Migration and CEB Member States that are recording substantial refugee inflows from Ukraine. The CEB has also approved €1.3 billion to-date in new loans to support CEB Member States in dealing with the humanitarian emergency caused by the war.
For the first time since the Bank’s establishment, the paid-in portion of the capital increase, amounting to €1.2 billion, will be financed through cash contributions from Member States. Ireland’s share of this paid-in subscription is €10.5 million and will be paid from the Central Fund over four annual instalments.
In 2022, Ukraine applied to join the CEB. The Financial Conditions to facilitate their membership were agreed in Dublin last July during the Bank’s Annual Meeting. At this meeting, Minister Donohoe announced an Irish initiative to establish a special fund for Ukraine and committed the sum of €1 million. Following the completion of Ukraine’s accession to the Bank, operations can commence within Ukraine to support the millions of citizens displaced internally and to rebuild the healthcare and housing sectors leveraging CEB’s expertise.