Should the European investment bank be accountable to financial supervisors?

Key Points

• The European Investment Bank (EIB) is not subject to European Union (EU) banking rules or external financial supervision.

• The EIB’s Best Banking Principles (BBP) selectively apply the EU’s prudential banking requirements, leaving the Bank with a self-selected set of stability indicators.

• The European Parliament and some EU member states have argued that the Bank should be externally supervised by an EU public entity.

• External supervision is legally difficult, and the Bank’s conservative lending practices mean that it is financially robust.

• Financial supervisors should support the EIB’s Board of Directors without compromising the Bank’s autonomy.