Strong demand for new EUR 5 billion Global 3-year EARN

• Issue priced in line with EIB yield curve and at +10 bps over the BOBL 140
• Oversubscribed book totaling nearly EUR 7 billion
• Increases EARN curve outstandings to EUR 65 billion
• Reinforces reputation for offering the EUR market highly liquid securities across a comprehensive range of maturities

The European Investment Bank (EIB') today priced its first Euro Area Reference Note (EARN) of 2004, a EUR 5 bn Global issue with a maturity of 15 October 2007. With this offering, the European Investment Bank further strengthened its comprehensive EARN yield curve, consisting of benchmarks worth an aggregate of nearly EUR 65.5 billion and with maturities ranging from 2004 to 2013. The transaction reinforces EIB's consistent and comprehensive eurobenchmark strategy, characterized by offering sovereign class liquidity across a comprehensive range of maturities.

The transaction, lead managed by Dresdner Kleinwort Wasserstein, Goldman Sachs International and Société Générale CIB, was fairly priced, in line with the EIB EARN yield curve, adding to the potential for favourable secondary market performance. The transaction achieved a spread of +10 bps over the relevant German government bond (BOBL 140 due August 2007). The issue pays a coupon of 2.625% and has an issue price of 99.915%. The issue was supported by a strong and broadly based syndicate group comprising 21 additional banks.

The underlying market in 2004 has thus far been characterized by volatility arising from uncertainty over the direction of the global economy. This has heightened demand for top quality, short dated, liquid securities. With this transaction, EIB proved that it is strongly positioned to meet this demand. The results of the transaction also underline the continued appeal of the diversification offered by EIB as the Consolidated European Sovereign Issuer, based on its ownership by EU Member States.

Demand for the issue was strong, reaching nearly EUR 7 billion, and broadly based, originating from around 250 investors worldwide. Demand was particularly strong in Europe but also in Asia. The level and quality of demand in Asia / Japan underlined the strengthening presence of EIB EUR issues in this region.

Composition of demand for the EARN issue:

Comments from EIB and the Lead Managers:

EIB's René Karsenti, Director General, Finance, said: The level and quality of demand in this transaction show that the Bank's strategic approach and strong positioning, as the Consolidated European Sovereign Issuer, continue to be highly appealing for investors. The fact that we received orders worth over EUR 6bn on a re-offer basis, in other words not subject to specific limits, underlines the trust that investors place in EIB's market driven approach, with fairly priced benchmark transactions.

Dresdner KW's Joe Dryer, Global Head of Capital Markets Origination, commented: "We are absolutely delighted with the success of this new 3-year EARN. This issue highlights one more time the EIB's unique standing among investors across the world, from Central Banks to retail investors, and the pertinence of the EARN strategy. Full credit to the EIB's funding team for selecting the right tenor and the right timing."

Goldman Sachs' Michael Sherwood, Head of Fixed Income, Currency and Commodities, Europe, said: The EIB chose well again the right instrument for the underlying market, thereby adding to its string of highly successful EARNs issues. This 3-year transaction fits perfectly euro investors' desire for safe, liquid securities that are assured performance in these uncertain times, and the strong demand seen from around the world proved this.

Société Générale-CIB's Olivier Khayat, Head of Debt Capital Markets, Europe, commented: "Since the beginning we have had a very good reception; the book closed at nearly EUR 7 billion with roughly 250 different accounts participating in the deal. There was little sensitivity from investors regarding the initial price talk and as a consequence we managed to price the EARN at the very tight end of the range."

Secondary market trading

Secondary market trading in the issue began immediately following pricing on EuroMTS. The entire EARNs curve trades on MTS, with the 12 largest benchmarks (worth EUR 63 billion) trading on EuroMTS. EIB continues to offer the leading quasi-sovereign yield curve in EUR.

Syndicate details

The syndicate working alongside the join lead managers consisted of: Senior Co-Lead Managers: Barclays, BNP Paribas, Citigroup, CSFB, Deutsche Bank, HSBC, JP Morgan, Morgan Stanley, Nomura and UBS; Co-Lead Managers: ABN Amro, CDC, Crédit Agricole, ING, Lehman Brothers, Merrill Lynch, UBM Unicredito; and a Selling Group: Banca Akros, Nordea, RBS and Tokyo Mitsubishi.

Further details on EIB and on the terms and conditions for the new bond Issue are attached.

Summary Terms and Conditions for the new Bond Issue

EIB's EUR issuance program

The Bank's funding strategy in EUR continues to be characterized by a mix of consistency and innovation, in line with the overall funding strategy. The cornerstone of EIB's funding in EUR remains the issuance of large liquid benchmarks across a comprehensive range of maturities under the Euro Area Reference Notes (EARNs) program. In addition, the Bank remains responsive to opportunities for targeted and structured issuance. This is coupled with strong market making arrangements and a committed presence on leading electronic trading platforms, notably EuroMTS, where 12 of EIB's 13 EARNs are traded alongside major government issues.

Issuance in EUR accounted for the largest share of EIB issuance in 2003 (EUR 17 billion or 41% of the total). In 2003 the Bank completed 53 transactions in EUR, raising EUR 17.3bn, compared with EUR 13.3bn via 19 transactions in 2002. There was especially strong growth in structured issuance in the form of inflation-linked and callable bonds.

EIB funding strategy and results

The Bank's funding strategy combines a consistent and transparent approach with flexibility and innovation, both in terms of product and maturity. In 2004 EIB plans to issue around EUR 47 billion. So far this year the EIB has raised over EUR 17 billion (including the latest EARN issue), in 11 different currencies.

In 2003 the Bank strengthened its position as the largest and leading supranational bond issuer. The volume of borrowing increased by 11% to EUR 42 billion, raised through 310 transactions in 15 currencies. The Bank's three core currencies (EUR, GBP, USD) accounted for 88% of funding.

Background information on EIB

The European Investment Bank, based in Luxembourg, was set up under the Treaty of Rome in 1958. Owned by the European Union Member States, the EIB is the EU's long-term lending institution, financing projects that promote European economic development and integration. Besides supporting projects in the Member States, its main lending priorities include financing investments in future Member States of the EU. The EIB operates on a non-profit maximising basis and lends at close to the cost of borrowing. The Bank's consistent AAA rating is underpinned by firm shareholder support, a strong capital base, exceptional asset quality, conservative risk management and a sound funding strategy.