Category: Banking

MIL-OSI Economics: Principality of Andorra: Staff Concluding Statement of the 2025 Article IV Mission

Source: International Monetary Fund

February 11, 2025

A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit (or ‘mission’), in most cases to a member country. Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement, in the context of a request to use IMF resources (borrow from the IMF), as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

The authorities have consented to the publication of this statement. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF Executive Board for discussion and decision.

Andorra La Vella – February 11, 2025

The Andorran economy is doing well. This provides a window of opportunity to address substantial long-term challenges. The authorities have consolidated the country’s macro-financial framework and reinforced buffers. However, Andorra’s real GDP per capita—while high in absolute terms—has remained flat over the last 50 years, with growth largely driven by population increases. Going forward, population aging is both an economic and a fiscal concern, and climate change challenges an economic model largely dependent on winter tourism. Ambitious structural reforms are needed to unlock investment and lift productivity.

Economic Outlook

The Andorra economy continues to show resilience and to grow above its potential. Growth in 2024 surprised slightly on the upside, at an estimated 2.1 percent, driven by the service, banking and construction sectors. Inflation is subsiding gradually, reaching 2.6 percent at the end of 2024, despite limited economic slack and a still tight labor market. The current account surplus remains very large, estimated at 15.1 percent of GDP in 2024. The strong performance of banks continued in 2024 supported by high interest margins and increased fees and commissions.

Going forward, GDP is expected to slow to the level of potential growth. Real GDP growth is forecasted at 1.7 percent in 2025 and 1.5 percent from 2027 onwards. Inflation is projected to stabilize at 1.7 percent over the medium term. Short-term risks are balanced: greater uncertainty in the global economy and the potential for adverse shocks such as deepening geoeconomic fragmentation, supply disruptions, recurrent commodity price fluctuations and a reversal of monetary policy loosening are downside risks to growth and inflation. On the upside, Andorra, like other service-oriented economies in Europe, could benefit from stronger demand, and grow faster than projected. Solid buffers mitigate risks.

Challenges are concentrated over the medium-term, as stagnating income growth makes it challenging to address the impact of population aging and climate change. With long life expectancy and low fertility rates, Andorra’s population is expected to age rapidly—removing an engine for GDP growth and creating fiscal liabilities over the long term. Fiscal costs from pensions and healthcare will be substantial. More frequent climate shocks can affect the economic cycle in an economy largely reliant on winter tourism, and structurally warmer temperatures will require extensive adaptation.

Policy priorities

The solid macroeconomic position and the credibility of the policy framework provide Andorra with an opportunity for implementing far-reaching structural reforms. Diversifying the economy to enhance resilience, unlocking investment and lifting productivity to raise income levels, and addressing the costs of aging and climate change should be driving the policy agenda. The recently negotiated EU Association Agreement (EUAA), if approved by referendum, could offer an opportunity to support the reform momentum, but would also bring challenges.

Maintaining a solid fiscal framework given spending pressures over the medium term

Maintaining a disciplined fiscal policy within the fiscal framework is important and will provide room for more public investment. In a microstate that needs fiscal buffers against external shocks, entrenching fiscal space is important. In addition, the credibility of the fiscal framework and the primary surplus provide room for higher public investment to support potential growth and mitigate structural bottlenecks.

A balanced 2025 budget focused on economic priorities. The 2025 budget finds a welcome balance between maintaining a conservative fiscal stance but building on the authorities’ structural priorities, with a focus on health, housing, maintaining purchasing power, and education. Overall, the 2025 budget foresees a deficit of 0.9 percent of GDP. Given past practice of adjusting expenditures in line with incoming revenues, staff forecasts a small surplus of about 0.3 percent of GDP.
Room for growth-enhancing public spending. The fiscal framework, which prescribes an overall deficit limit of 1 percent of GDP and a central government debt ceiling of 40 percent of GDP, provides room for higher public spending targeted towards growth-enhancing investment. Spending should be focused on the structural needs of the economy: social and affordable housing, upskilling the workforce and addressing labor shortages, connectivity to support economic diversification, and investments to lift potential growth. As under-execution of budgeted public investment is customary, delivering on investment plans should be a policy objective.

Over the medium term, Andorra faces rising spending pressures from aging, as well as a need to adapt to climate change—engaging reforms early is paramount. Staff estimates that by 2050, pension system expenditures will rise by 6.7 percentage points while healthcare expenditures will increase by 2 percentage points. Acting early on pension and healthcare reforms is needed to anticipate and mitigate the fiscal impact of aging.

Pension reform has been on the government’s agenda for some time and is overdue. The menu of options to put the system on the sustainable path is well understood, from increasing contribution rates and reducing conversion rates to increasing the retirement age. Concluding the reform in an expeditious and comprehensive manner is needed to ensure the sustainability of the social security fund in the long run.
A reform of the healthcare system should aim to contain long-term costs while raising healthcare revenues . Experience from other advanced economies provides a blueprint for potential measures, in 4 areas: (i) enhance cost efficiency, (ii) strengthen preventive care, (iii) increase revenues for healthcare while preserving equity, and (iv) improve governance. The National Pact brought together stakeholders and should continue its work to strengthen the healthcare system.

· Beyond direct policies in the pension and healthcare areas, broader measures would be helpful to buffer the additional long-term fiscal costs of aging. Domestic revenue mobilization and migration policies can help.

Climate change also exposes the government to future contingent liabilities. Public investment needs to increase to meet Andorra’s climate change mitigation targets and to provide adequate support to the adaptation of the private sector. In addition, fiscal space will be increasingly needed to buffer the negative impact of climate shocks.

Precautionary borrowing and a rapid reduction in public debt provide the authorities with flexibility in managing the debt profile. The authorities are reaping the benefits of an effective debt management strategy that is projected to bring public debt down to 30 percent of GDP by 2026, that lengthened its maturity to 6.3 years and that keeps public debt service low. The authorities should continue to monitor market conditions for an upcoming debt maturity of €500 million public bonds in 2027, including for further diversifying debt and extending its maturity to decrease rollover risks and mitigate consequences from potential increases in interest rates.

Consolidating banking performance in a changing environment

Strengthening further the resilience of the banking system during periods of high profitability is appropriate. The banking sector displays solid fundamentals, with large capital and liquidity buffers. However, given the large size of the banking sector, the supervisor should remain vigilant. Available supervisory tools should complement each other, including by supporting the lender of last resort facility introduced in 2022 by continued close supervision and a well-designed resolution framework to ensure that critical problems are identified and addressed early. The activation of a countercyclical capital buffer in 2024 was timely to increase banking system resilience during high bank profitability.

The changing financial landscape, notably with the continued international expansion of banks and a possible EUAA, brings opportunities and challenges for Andorran banks. Banks have been growing in the EU where they run independent subsidiaries focused on private banking services, and the EUAA would facilitate this expansion, notably in the asset management business. Domestically, the EUAA has the potential to create a more dynamic domestic market but also to open Andorra to greater competition. The authorities should work closely with banks to prepare for the transition and safeguard financial stability.

Ambitious structural reforms to unlock investment and lift productivity, support the diversification of the economy and help mitigate climate change.

A comprehensive set of structural measures is important and should focus on the following:

Addressing frictions, notably labor and housing shortages. Public investment in education and well-designed immigration policies can improve knowledge capital in Andorra and raise labor productivity. Multiple housing measures were implemented recently—including the extension of existing rental contracts, the creation of a public affordable housing park, tax incentives for owners who offer affordable housing, suspension of tourist accommodation licenses, fees on empty houses and on real estate purchases by foreigners. The authorities should aim at providing market-based incentives for investing in affordable housing while minimizing distortions.
Creating a business environment conducive to higher investment. Recommendations encompass reducing administrative rigidities associated with doing business in Andorra, promoting access to financing, and implementing measures to attract and retain talent.
Supporting the development of higher value-added sectors, including the digital economy. With limited space for manufacturing, Andorra can look at the experience of peer countries that have successfully diversified towards the digital economy. Government policies, including the 2022 Law on the digital economy, entrepreneurship, and innovation and the Digitalization Strategy 2020-2030 were welcome initial steps.

The EUAA could provide further momentum for reforms towards diversification, unlock investment, and raise productivity in Andorra, but is not without its own challenges. The agreement signals a strong commitment to deeper integration with the EU and to reinforce Andorran institutions in their coherence with EU standards. Empirical evidence on the benefits of EU membership provides useful lessons for EU association. It suggests that while the impact can be significant and positive, it builds up over time, and is conditional on well-designed domestic reforms during the accession period. While the impact varies with country-specific circumstances, it materializes through a few channels: structural reforms in the period preceding accession/association, greater capital accumulation, notably FDI, and higher productivity. In Andorra, room for increasing investment and productivity is substantial. Transition periods for key sectors such as telecom and banking mitigate the risks of disruption and fiscal space can cover transition costs. Preparedness is essential to realize the benefits of association, and reduce potential downsides, such as greater regional competition.

The climate adaptation strategy needs to be accelerated given the macrocriticality of global warming for Andorra. Because of its higher altitude, Andorra is less exposed than other winter tourism locations in the region and should use this window of opportunity to enact needed policies, support the development of higher value-added service sectors and diversify away from winter tourism. The authorities should expedite the development and execution of a climate adaptation strategy.

The mission thanks the authorities and all our counterparts for a constructive and candid policy dialogue, for engaging in a productive and transparent collaboration, and for their hospitality during the official visit of the IMF to Andorra.

Andorra: Selected Social and Economic Indicators

	I. Social Indicators
	Population (2023)	85101		Population at risk of poverty (percent, 2020)					13
	Per capita income (2023, euros)	40511		Human Development Index Rank (2021)					40 (out of 189)
	Gini Index (2020)	32		Life expectancy at birth (2024)						83.9

	II. Economic Indicators
					Projections
		2022	2023	2024	2025	2026	2027	2028	2029		2030

	NATIONAL ACCOUNTS AND PRICES		(annual change, percent, unless otherwise indicated)
	Real GDP	9.6	2.6	2.1	1.7	1.6	1.5	1.5	1.5		1.5
	Nominal GDP	14.2	9.0	5.0	3.7	3.4	3.3	3.2	3.2		3.2
	GDP deflator	4.2	6.3	2.9	1.9	1.8	1.7	1.7	1.7		1.7
		(contribution to nominal GDP growth, percentage points)
	Consumption	6.5	7.0	3.6	2.5	2.5	2.5	2.5	2.4		2.4
	Private	6.2	3.5	1.7	1.5	1.5	1.5	1.5	1.4		1.4
	Public	0.3	3.4	1.9	1.0	1.0	1.0	1.0	1.0		1.0
	Investment	6.8	-2.2	0.9	0.5	0.6	0.3	0.3	0.4		0.5
	Private 1/	6.4	-3.1	0.2	0.0	0.4	0.1	0.1	0.2		0.3
	Public	0.4	0.9	0.7	0.5	0.2	0.2	0.2	0.2		0.2
	Net exports of goods and services	0.9	4.3	0.7	0.6	0.4	0.4	0.4	0.4		0.4
	Exports	18.8	10.4	4.2	3.3	2.8	2.8	2.9	2.9		2.8
	Imports	18.0	6.1	3.5	2.7	2.5	2.4	2.5	2.5		2.4

	Prices
	Inflation (percent, period average)	6.2	5.6	3.1	2.2	1.8	1.7	1.7	1.7		1.7
	Inflation (percent, end of period)	7.2	4.6	2.6	2.0	1.7	1.7	1.7	1.7		1.7

	Unemployment rate (percent)	2.1	1.6	1.6	1.6	1.8	1.8	1.9	2.0		2.0

	EXTERNAL SECTOR	(percent of GDP, unless otherwise indicated)

	Current account	11.6	14.2	15.1	17.0	17.0	17.0	17.0	17.0		17.0
	Balance on goods and services	8.8	12.0	12.0	12.2	12.1	12.1	12.1	12.1		12.1
	Exports of goods and services	80.9	83.7	83.7	83.9	83.8	83.9	84.1	84.2		84.3
	Imports of goods and services	72.2	71.8	71.6	71.7	71.7	71.8	71.9	72.1		72.2
	Primary income, net	4.3	3.5	4.3	6.1	6.1	6.1	6.1	6.1		6.1
	Secondary income, net	-1.4	-1.3	-1.3	-1.3	-1.3	-1.3	-1.3	-1.3		-1.3
	Capital account	0.0	-0.1	0.0	0.0	0.0	0.0	0.0	0.0		0.0
	Financial account	12.7	13.5	15.1	17.0	17.0	17.0	17.0	17.0		17.0
	Errors and omissions	1.1	-0.6	0.0	0.0	0.0	0.0	0.0	0.0		0.0
	Gross international reserves (millions of euros) 2/	338.4	338.7	399.0	399.0	399.0	399.0	399.0	399.0		399.0

	FISCAL SECTOR	(percent of GDP, unless otherwise indicated)

	General Government 3/
	Revenue	39.7	38.0	37.9	37.8	37.7	37.8	37.8	37.7		37.8
	Expenditure	34.9	35.9	36.5	36.7	36.6	36.9	36.9	37.0		37.0
	Interest	0.7	0.6	0.6	0.6	0.6	0.8	0.8	0.8		0.8
	Primary balance	5.6	2.7	2.0	1.7	1.6	1.6	1.7	1.6		1.6
	Net lending/borrowing (overall balance)	4.8	2.1	1.5	1.1	1.1	0.8	0.9	0.8		0.8
	Public debt	38.9	35.5	33.7	32.5	31.5	30.5	30.0	29.5		29.0

	Central Government 4/
	Revenue	21.7	19.8	21.3	20.8	20.8	20.8	20.8	20.8		20.9
	Expenditure	18.7	19.1	20.4	20.5	20.5	20.6	20.7	20.6		20.7
	Interest	0.7	0.5	0.5	0.5	0.5	0.7	0.7	0.7		0.7
	Primary balance	3.6	1.2	1.4	0.8	0.8	0.9	0.8	0.9		0.9
	Net lending/borrowing (overall balance)	2.9	0.7	0.9	0.3	0.3	0.2	0.1	0.2		0.2
	Public debt	37.1	34.0	32.3	31.2	30.1	29.2	28.7	28.3		27.9

	BANKING SECTOR5 /	(percent, unless otherwise indicated)

	Regulatory capital to risk-weighted assets	20.3	21.7	21.2	…	…	…	…	…		…
	Nonperforming loans to total gross loans	3.3	2.2	2.1	…	…	…	…	…		…
	Credit to nonfinancial private sector
	Level (percent of GDP)	116.4	101.3	94.5	…	…	…	…	…		…
	Corporates	61.8	55.1	51.1	…	…	…	…	…		…
	Households	54.6	46.2	43.4	…	…	…	…	…		…
	Growth (nominal)	-1.7	-5.2	-2.0	…	…	…	…	…		…
	Corporates	2.6	-2.8	-2.5	…	…	…	…	…		…
	Households	-6.1	-7.8	-1.3	…	…	…	…	…		…
	Credit to public sector
	Level (percent of GDP)	2.2	1.8	1.5	…	…	…	…	…		…
	Growth (nominal)	-8.4	-10.0	-13.0	…	…	…	…	…		…

	Memorandum items
	Exchange rate (€/USD, period average) 6/	0.95	0.92	0.92	0.97	0.97	0.97	0.97	0.97		0.97
	Nominal GDP (millions of euros)	3,210	3,501	3,676	3,811	3,942	4,070	4,202	4,338		4,478

	Sources: Andorran authorities, Eurostat, and IMF staff calculations.
	1/ The contribution of private investment is derived as a residual and includes investments of state-owned enterprises.
	2/ The increase of gross international reserves in 2022 is due to €100 million deposited at the Bank of Spain, €40 million at the Banque de France, and €60 million at the Nederlandsche Bank as gross international reserves. In 2024, additional €60 million reserves were accounted, mainly deposited at the Bank of Spain.
	3/ The general government comprises the central government, local governments, and the social security fund.
	4/ The central government comprises Govern d’Andorra, as well as nonmarket, nonprofit institutional units.
	5/ 2024 data corresponds to 2024Q3.
	6/ The table reports the exchange rate €/USD because Andorra is a euroized economy.

IMF Communications Department

MEDIA RELATIONS

PRESS OFFICER: Camila Perez

Phone: +1 202 623-7100Email: MEDIA@IMF.org

MIL OSI Economics –

February 12, 2025

MIL-OSI Europe: The EBA amends its Guidelines on ICT and security risk management measures in the context of DORA application
Source: European Banking Authority

The European Banking Authority (EBA) narrowed down the scope of its existing Guidelines on ICT and security risk management measures, due to the application of harmonised ICT risk management requirements under the Digital Operational Resilience Act (DORA) from 17 January 2025. These amendments aim at simplifying the ICT risk management framework and providing legal clarity to the market.

DORA has introduced harmonised requirements on ICT risk management that apply to financial entities across the banking, securities/markets, insurance and pensions sectors.

To avoid duplication of requirements and to provide legal clarity to the market, the EBA has amended its Guidelines on ICT and security risk management. In particular, the EBA has narrowed down:
- the entity scope of the Guidelines to only those that are covered by DORA, namely credit institutions, payment institutions, account information service providers, exempted payment institutions and exempted e-money institutions; and
- the scope of the Guidelines to the requirements on relationship management of the payment service users in relation to the provision of payment services.
It is important to note that security and operational risk management requirements under the Payment Services Directive (PSD2), which are applicable since March 2018, continue to apply to other types of payment service providers (PSPs), such as post-office giro institutions and credit unions, that are not covered by DORA. PSPs that are still subject to security and operational risk management under the PSD2 can potentially be subject to additional national requirements, regardless of the existence of the EBA Guidelines that would apply to them. Competent authorities or Member States’ governments wishing to retain the approach set out in the EBA Guidelines for those PSPs can continue to do so under their national legal framework or supervisory measures.

Background, legal basis and next steps

On 27 November 2019, the EBA published the Guidelines on ICT and security risk management (EBA/GL/2019/04) (“Guidelines”) which were built on the provisions of Article 74 of Directive 2013/36/EU (CRD)^[1] and Article 95(3) of Directive (EU) 2015/2366 (PSD2)^[2] . These Guidelines established requirements for credit institutions, investment firms and PSPs on the mitigation and management of their ICT and security risks and aim to ensure a consistent and robust approach across the Single market. The Guidelines entered into force in 2020 and replaced and repealed the preceding Guidelines on security measures for operational and security risks that the EBA had issued three years earlier in fulfilment of a mandate under PSD2 (EBA GL/2017/17).

From 17 January 2025, DORA applies and introduces, inter alia, harmonised requirements for ICT risk management framework (RMF), incident reporting, and third-party risk management and testing.

The amended Guidelines will apply within two months of the publication of the translated versions.

^[1] EBA mandate to further harmonise financial institutions’ governance arrangements, processes and mechanisms across the EU regarding internal governance

^[2]EBA mandate to issue guidelines with regard to the establishment, implementation and monitoring of security measures for operational and security risks.

The Guidelines replaced those on security measures for operational and security risks (EBA GL/2017/17), which were repealed
MIL OSI Europe News –
February 11, 2025
MIL-OSI Russia: The Central Bank of the Russian Federation warns that fraudsters have mastered a new scheme of deception with virtual cards

Translartion. Region: Russians Fedetion –

Sours: Mainfin Bank –

How does the new scheme that the Bank of Russia is warning about work?

Another fraudulent scheme allows you to steal money remotely kart Russians – the fraudsters do not need to have a plastic card in hand. The fraud occurs in stages:

Fraudsters inform a citizen about an attempt by unidentified persons to steal money from a card. The victim is forced to install the “official application of the Central Bank of the Russian Federation” to protect their finances. The person who launches the application must attach the bank card to the phone and enter the code from the SMS for authorization. The application creates a virtual image of the card (similar to, for example, MirPay), to which the attackers have access. Now the fraudsters will be able to withdraw money from any ATM that operates using contactless technology – just attach your smartphone.

If the victim has several cards, the attackers may offer to “link” them all – then the volume of thefts will increase. It is also possible to use a combined fraud scheme – first the fraudsters will call, then – allegedly representatives of law enforcement agencies, reporting an attempt at fraud and the need to “save money”.

What should you do if you receive calls or messages from scammers?

The Bank of Russia reminded Russians about the ban on transferring personal and banking data to third parties. It is not difficult to recognize a fraudster in the caller – the attackers most often use the following phrases:

“an application for a loan has been submitted”, the victim gets scared and tries to cancel it; “an employee of the Central Bank” calls, then the legends can be different; the money needs to be transferred to a “safe or special account”, which in fact belongs to the scammers; “a suspicious transaction has been recorded”, for example, a transfer to an unknown person; “SIM card has expired”, “you need to renew your contract with the telecom operator”, the main thing is to provide the code from the SMS.

“If scammers call, you must hang up and not disclose information. You also cannot install various applications at the request of callers,” the Central Bank of the Russian Federation reminded.

Russians are informed literally every day about the need to remain vigilant, but this does not stop criminals from stealing funds – in 2024, the volume of thefts increased by 8% compared to the previous year.

12:30 11.02.2025

Source:

Please note: This information is raw content directly from the source of the information. It is exactly what the source states and does not reflect the position of MIL-OSI or its clients.

Please Note; This Information is Raw Content Directly from the Information Source. It is access to What the Source Is Stating and Does Not Reflect

HTTPS: //Mainfin.ru/novosti/zb-RF-RF-pre-AMENSIS-OSENNIS-NOT-NOVE-SHEMA-SOCHE-SC-Virtual-Card

MIL OSI Russia News –

February 11, 2025
MIL-OSI Africa: African Development Bank’s Climate Action Window channels $31m to boost climate resilience in four countries

Source: Africa Press Organisation – English (2) – Report:

ABIDJAN, Ivory Coast, February 11, 2025/APO Group/ —

The Board of Directors of the African Development Bank Group (www.AfDB.org) has approved over $31 million in funding under its African Climate Action Window (CAW) to strengthen climate resilience in Sierra Leone, South Sudan, Djibouti, and Madagascar.

The Climate Action Window of the Bank Group’s African Development Fund seeks to mobilize $4 billion by 2025 to provide rapid and coherent access to climate finance, support co-financing, and prioritize the most vulnerable countries, fragile states, and those affected by conflict. The African Development Fund is the concessional arm of the Bank Group.

The funding, approved in November and December 2024, will support innovative projects that respond to the CAW’s first call for project proposals. Forty-one pioneering climate adaptation projects valued at $321.75 million have been selected in the initial funding wave, with a focus on tackling climate change, bolstering livelihoods of vulnerable communities, including women and youth, and enhancing climate information systems.

The projects will also benefit from $28.13 million in climate co-financing from sources including the Green Climate Fund.

In Sierra Leone, the Freetown WASH and Aquatic Environment Revamping Project will receive $5 million to enhance access to sustainable water, sanitation, and hygiene (WASH) services and introduce modernized hydrometeorological observation networks and early warning systems, benefiting approximately 700,000 people. Another key component of the project is the creation of an interactive flood map for the Freetown Peninsula, a crucial tool for disaster risk reduction.

In South Sudan, the Climate Resilient Agri-Food Systems Transformation Programme has been allocated $9.4 million to expand climate-adaptive technologies that enhance agricultural productivity and food and nutritional security. The program also has a rehabilitation element focusing on 1200 hectares of land as well as rural infrastructure and will provide training to about 8,000 individuals.

Among expected benefits are a projected reduction of about 720,000 tonnes of CO₂ emissions. and the creation of 180,000 direct jobs with a strong focus on women and youth; additionally, 90,000 farmers will learn about climate-smart farming practices.

In Djibouti, the Youth Entrepreneurship for Climate Change Adaptation Project will receive $7.5 million to strengthen the resilience of productivity of agricultural systems, particularly for horticulture and pastoralism, including increasing the self-sufficiency rate of selected market garden crops from 10% to 30%. It is also expected to generate about 3,500 permanent jobs, a significant share of these for youth and women, and create 200 new medium small and micro enterprises.

The Climate Resilience through Park Biodiversity Preservation Project, in Madagascar, has been allocated $9.4 million for investment in conserving biodiversity by protecting Lokobe, Nozy Hara, and Andringitra national parks.

The project will restore 100% of these protected areas, sequestering 10 million tonnes of CO₂, and creating 1,500 green jobs, with 500 specifically reserved for women. In addition to environmental conservation, it will boost agricultural production in surrounding communities to add 24,000 tonnes of rice and 14,000 tonnes of cereals, legumes and other crops. Further, 24,000 farmers will receive irrigation training, and 12 women-led farmers’ groups will be provided with agricultural kits.

Dr. Kevin Kariuki, African Development Bank Vice President for Power, Energy, Climate Change and Green Growth, said: “The Climate Action Window is catalyzing transformative solutions in Africa’s most climate-vulnerable regions. From strengthening water security in Sierra Leone to advancing youth-led agribusiness in Djibouti and restoring biodiversity in Madagascar, these initiatives go beyond adaptation—they drive prosperity. Through investments, we are equipping communities to withstand climate shocks, create jobs, and accelerate inclusive economic growth.”

Prof Anthony Nyong, the Bank’s Director for Climate Change and Green Growth said, “These initiatives are not just about responding to climate change—they empower communities to take control of their own futures. They show that adaptation finance can and must be directed to those vulnerable communities that need it most. The Climate Action Window is more than just a funding mechanism—it’s a lifeline for communities facing the harsh realities of climate change every day.”

The CAW has since launched two further calls focusing on mitigation and on technical assistance, respectively.

For more information about the Climate Action Window, click here (http://apo-opa.co/3WUGQPo).

MIL OSI Africa –

February 11, 2025
MIL-OSI Economics: Mitigating the Data Gap in Greenhouse Gas Emissions Calculation for Small and Medium-Sized Enterprises

Source: Asia Development Bank

The brief outlines the benefits and challenges of emissions calculation. It examines key data requirements, such as emission factors (EFs), and reviews progress among members of the Association of Southeast Asian Nations in setting country-specific EFs. It suggests leveraging available technology to help bridge data gaps. It also provides recommendations from market practitioners on standardizing the GHG emissions calculation process to support enhanced climate-related disclosure.

MIL OSI Economics –

February 11, 2025
MIL-OSI Submissions: OPEC Fund provides a €50 million loan to accelerate Türkiye’s green transformation

Source: OPEC Fund for International Development (the OPEC Fund)

February 11, 2025: The OPEC Fund for International Development (the OPEC Fund) has signed a €50 million loan agreement with the Industrial Development Bank of Türkiye (TSKB) to support investments in renewable energy, energy efficiency, climate adaptation, climate-related equipment production, and circular economy initiatives.

The financing, provided through an on-lending arrangement with the Republic of Türkiye’s Ministry of Treasury and Finance, marks the first collaboration between the OPEC Fund and TSKB.

OPEC Fund President Abdulhamid Alkhalifa said: “This milestone partnership with TSKB underscores our commitment to advancing climate action and sustainable development in Türkiye. By channeling funding into renewable energy, energy efficiency, and climate-resilient industries, we aim to support Türkiye’s transition to a low-emission economy and its net zero target by 2053, while fostering inclusive and green economic growth.”

TSKB CEO Murat Bilgiç said: “We are delighted to establish our first loan partnership with the OPEC Fund, which will help diversify our sustainable funding sources and support Türkiye’s green transformation. This secured loan aligns with national climate goals and the 2053 Long-Term Climate Strategy, contributing to sustainable development and climate adaptation efforts. We aim for this resource to finance low-emission and resilient economy projects, bringing significant benefits to our country.”

The OPEC Fund has been a longstanding partner to Türkiye since 1976, supporting projects in key sectors including energy, infrastructure, agriculture and health.

About the OPEC Fund

The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively.

The organization works in cooperation with developing country partners and the international development community to stimulate economic growth and social progress in low- and middle-income countries around the world.

The OPEC Fund was established in 1976 with a distinct purpose: to drive development, strengthen communities and empower people.

Our work is people-centered, focusing on financing projects that meet essential needs, such as food, energy, infrastructure, employment (particularly relating to MSMEs), clean water and sanitation, healthcare and education.

To date, the OPEC Fund has committed more than US$29 billion to development projects in over 125 countries with an estimated total project cost of about US$225 billion. The OPEC Fund is rated AA+ (Stable Outlook) by Fitch and S&P. Our vision is a world where sustainable development is a reality for all.

MIL OSI – Submitted News –

February 11, 2025
MIL-OSI: Recording of LHV Group’s 11 February investor webinar

Source: GlobeNewswire (MIL-OSI)

To give an overview of the 2024 Q4 and 12 month financial results, LHV Group organised an investor meeting webinar on 11 February. An overview of the company’s progress was given by Madis Toomsalu, Chairman of the Management Board of LHV Group and Meelis Paakspuu, CFO of LHV Group.

The live coverage was followed by 44 participants, the live feed of the presentation was broadcast over Zoom.

Recording of the investor meeting (in Estonian) is available at: https://www.youtube.com/watch?v=jmt0XVLumrU

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. The Group employs over 1,200 people. As at the end of December, LHV’s banking services are being used by nearly 460,000 clients, the pension funds managed by LHV have 114,000 active clients, and LHV Kindlustus is protecting a total of 170,000 clients. LHV Bank Limited, a subsidiary of the Group, holds a banking licence in the United Kingdom and provides banking services to international financial technology companies, as well as loans to small and medium-sized enterprises.

Priit Rum
Communications Manager
Phone: +372 502 0786
Email: priit.rum@lhv.ee

The MIL Network –

February 11, 2025
MIL-OSI Economics: Denis Beau: The foundations of trustworthy AI in the financial sector

Source: Bank for International Settlements

Ladies and gentlemen,

First of all, I’d like to thank the organizers for their invitation to launch this event focusing on the Paris financial centre’s AI strategy: just days before the international AI Action Summit, this gives me the opportunity to reiterate our determination at the Banque de France and the ACPR to take action on this major issue for the industry – and to do so in concert with all financial sector players. The summit will also be an opportunity for the Banque de France to reaffirm its commitment by organising a side event on 11 February, featuring a round table discussion on ethical and inclusive AI.

AI – as you are already well aware, is being increasingly used in the financial sector, whether to assess credit risk, set insurance rates or estimate asset volatility. For a supervisor, its impact is potentially double-edged: while AI is a source of opportunities for the sector – including for its supervisor – it is also a new vector of risk. This ambivalent impact partly explains the regulatory framework that has just been introduced in Europe.

The European Union has proven itself a pioneer in this area by adopting the AI Act in the summer of 2024. However, this legislation raises legitimate questions, especially for the financial sector: is there not a risk of hampering innovation in the name of controlling risk? I would like to reiterate, before you today, a strongly held conviction that may seem iconoclastic in the current environment: in the long run, regulating AI-related risks is good for competitiveness in both Europe and France. Without regulation, there can be no trust – and therefore no sustainable innovation.

Because my opening remarks this morning are from a supervisor’s perspective, I will discuss the opportunities and risks (I), then the conditions necessary for effective regulation of AI in the financial sector (II).

I/ To get a bit of perspective on things, I would like to revisit an initial observation: AI, combined with an abundance of available data, is a powerful vector of transformation for the financial sector.

1/ Our observations show that AI is increasingly being used by financial institutions along all segments of the value chain: i) to improve the “user experience”, ii) to automate and streamline internal processes, and iii) to control risks, particularly in the battle against fraud and against money laundering and the financing of terrorism.

The emergence of generative AI two years ago has triggered a revolution in the accessibility of AI technology, thanks to the possibility of interacting with algorithms using natural language – via Large Language Models (LLMs) – which makes adoption considerably easier. Generative AI is also boosting innovation within companies as computer code can now be written by a much broader group of people.

If harnessed properly, AI can therefore boost the efficiency of financial institutions, increase their revenues and provide them with risk management solutions.

2/ However, there is a downside, and the power of the solutions developed is accompanied by significant risks, both for each of the players in the financial system and for the stability of the system as a whole. I would like to mention three of these risks.

The first is that these technologies may be put to improper use. The complexity and newness of certain modelling techniques can result in more errors, either in systems design or use. This poses a risk not only for customers, but also for institutions’ financial health, as a poorly calibrated model could generate systematic losses. These risks are compounded by two factors. First, the adjustment of the parameters of certain models in real-time, which is one of their strengths, can also result in rapid drift. Second, certain AI systems are particularly opaque, generating a “black box” phenomenon.

The second risk I would like to highlight is cyber risk, which has become the number one operational risk in the financial sector over the past few years. AI amplifies this risk – both in terms of the danger posed by attackers and because it represents a new area of vulnerability. Conversely, we should be aware that AI can also enhance IT security, for example, by helping to detect suspicious behaviour.

Lastly, I’d like to highlight a third risk, which could become increasingly significant in the future, namely environmental risk. In the absence of reliable data provided by businesses or a commonly accepted basis of calculation, quantification of this risk is still subject to considerable variability. Nevertheless, it is clear that training the most recent generative AI models is a very energy-intensive process… and that if current trends continue, their regular use by billions of customers will be even more so. These factors naturally suggest that AI should be used rather frugally. In other words, AI systems should only be used when necessary.

II/ I would now like to turn to aspects of regulation, legislation and control, and primarily to the European AI Act. This will mainly concern the financial sector for two use cases: creditworthiness assessment for granting loans to individuals, and risk assessment and pricing in health and life insurance. The main impacts of this legislation will be felt from August 2026, and as market surveillance authority, the ACPR should be responsible for ensuring that it is properly applied.

With this in mind, I would like to share two simple messages with you this morning: i) the risks linked to AI can essentially be handled within the existing risk management frameworks; ii) however, we should not underestimate certain new AI-related technical challenges.

1/ The AI Act will not lead to any major upheaval in the way risks are managed in the financial sector.

Financial institutions have a sound risk management culture, as well as robust governance and internal control systems. The Digital Operational Resilience Act (DORA), which has just come into force, rounds out the traditional regulatory framework with specific rules on operational resilience and IT risk management. The financial sector is therefore well equipped to meet the challenge of complying with the new regulations.

Admittedly, the objectives of the AI Act – first and foremost the protection of fundamental rights – and those of sectoral regulation – financial stability and the ability to meet commitments to customer– differ. But operationally, when the AI Act requires “high-risk systems” to have data governance, traceability and auditability, or guarantees of robustness, accuracy and cyber-security throughout the lifecycle, clearly, we are not in uncharted waters.

Rather, I would like to reiterate that the usual principles of sound risk management and governance continue to apply under the AI Act. Naturally these will guide the ACPR in assessing systems compliance when it is called upon to exercise its role of market surveillance authority. More specifically, our vision for deploying this new mission will be underpinned by three simple principles: (i) implementing “market surveillance” in accordance with the AI Act, i.e. primarily aimed at identifying systems likely to pose compliance problems; (ii) defining supervision priorities using a risk-based approach to ensure that the resources deployed are proportionate to the expected outcomes; and (iii) unlocking all possible synergies with prudential supervision. I believe that this was the intention of the European legislator when it entrusted national financial supervisors with the role of “market surveillance authority”. It is also the best way of ensuring that we don’t make the regulations any more complex at a time when our common objective should be to simplify them.

Naturally, the principles of good governance and internal control also apply to algorithms not considered high-risk by the AI Act, if they pose risks to the organisations concerned – think of the use of AI systems in market activities, for example. Here, lessons learned from implementing the AI Act and the resulting best practices will be invaluable for both supervisors and supervised entities.

2/ Nevertheless, the challenges posed by the use of AI should not be underestimated

Some of the issues raised by this technology are definitely new. Let me give you two examples. Firstly, explainability: with each advance in this field, artificial intelligence algorithms have become increasingly opaque and in a regulated sector like the financial sector, this is a problem. More specifically, day-to-day users of AI tools need to have a sufficient understanding of how they work and of their limitations if they are to make appropriate use of them and avoid the twin pitfalls of either blindly trusting the machine or systematically mistrusting it.

The second example is fairness. AI can accentuate biases present in data. Indeed, one of the aims of the AI Act is to detect and prevent such biases before they cause harm to citizens. This is a technically complex issue, as banning the use of certain protected variables is not enough to guarantee safe algorithms. This is particularly true for activities such as granting loans or pricing insurance, where customer segmentation is part of normal business and risk management practices in a competitive environment.

To address these new challenges and comply with the various regulatory requirements, financial institutions will need to acquire new human and technical resources and upskill. As market surveillance authority and prudential regulator, the ACPR will ensure that risks are effectively managed. Compliance with the AI Act will have to be more than just an internal administrative labelling exercise, and financial institutions will have to ensure that the algorithms are managed and monitored by competent people who understand their inner workings.

This means that the financial supervisor itself has to upskill and adapt its tools and methods. The ACPR has already published certain proposals in the past concerning the issue of explainability. It will eventually have to establish a doctrine on this topic as well as on algorithm fairness. We will also need to develop a specific methodology for auditing AI systems.

We cannot and must not take this methodological step forward alone. In addition to unlocking synergies with other AI supervisors in France and Europe, we need to cooperate with the financial sector. Supervisors and supervised entities share many challenges and they will overcome them more effectively if they are able to move forward together.

Events like today provide an opportunity to channel our collective efforts into a widely shared project. It is by working together that we will be able to lay the foundations for trustworthy AI in the financial sector.
I wish you fruitful discussions throughout this morning.

MIL OSI Economics –

February 11, 2025
MIL-OSI Economics: Christine Lagarde: European Parliament plenary debate on the European Central Bank Annual Report

Source: Bank for International Settlements

It is a great pleasure to take part in this plenary session and discuss your draft resolution on the ECB’s Annual Report.

At the ECB, we are deeply committed to transparency and accountability, particularly in how we communicate with the public and their elected representatives in the European Parliament. In fact, in the last parliamentary term we interacted with this Parliament even more frequently than in previous terms.¹

At the same time, we greatly value the opportunity to hear the Parliament’s views. Your resolution and debate are an important pillar of the ECB’s accountability framework and a key channel for you to share your views with us – and we listen. For instance, next week will mark ten years since the ECB started publishing the accounts of the Governing Council’s monetary policy meetings², a major step in enhancing our monetary policy communication and one that this Parliament had called for.

This year’s draft resolution covers key issues that are central to the ECB’s mandate and the future of the euro area, including our response to inflation, the digital euro and the ECB’s role in supporting the EU’s broader economic policies. It also reflects the dynamic challenges we face in Europe today, and I look forward to hearing your thoughts on all of these issues and having a constructive dialogue with you.

But let me first start by outlining our view on the current economic situation in the euro area and our monetary policy stance. I will then address the broader economic challenges we are facing and their implications for monetary policy.

The euro area economy and the ECB’s monetary policy

The euro area economy grew modestly in 2024. While output stagnated in the fourth quarter, it was still 0.9% higher than at the end of 2023. Surveys indicate that manufacturing continues to contract while services activity is expanding. Consumer confidence is fragile and, despite rising real incomes, households are hesitant to spend more.

Nevertheless, the conditions for a recovery remain in place. A solid job market and higher incomes should strengthen consumer confidence and allow spending to rise. More affordable credit should boost consumption and investment over time. Exports should also support the recovery as global demand rises, although this is conditional on developments in international trade policies.

Inflation stood at 2.5% in January and has recently developed broadly in line with staff projections. Core inflation has remained at 2.7% in recent months, reflecting a sideways movement in both services and goods inflation. Wage growth is moderating as expected, although it remains elevated, while profits are partially buffering the impact of wage increases on inflation.

Inflation is set to return to our 2% medium-term target in the course of this year, with risks on both the upside and the downside. Greater friction in global trade would make the euro area inflation outlook more uncertain.

In total, the ECB has lowered interest rates by 125 basis points since last June, and the deposit facility rate – the rate through which we steer the monetary policy stance – now stands at 2.75%. At our last meeting in January, we decided to lower our key interest rates by 25 basis points, based on an updated assessment of the inflation outlook, the dynamics of underlying inflation and the strength of monetary policy transmission. In particular, the disinflation process in the euro area is well on track. Most measures of underlying inflation suggest that inflation will settle at around our target on a sustained basis. And while financing conditions continue to be tight, our recent interest rate cuts are gradually making borrowing less expensive.

We are determined to ensure that inflation stabilises sustainably at our 2% medium-term target. We will follow a data-dependent and meeting-by-meeting approach to determining the appropriate monetary policy stance. We are not pre-committing to a particular rate path.

A challenging economic environment for monetary policy

Let me now turn to the broader economic environment and its implications for monetary policy.

Europe has faced a series of unprecedented challenges in recent years, each with its own far-reaching impact. From the COVID-19 pandemic to surging energy prices and the geopolitical upheaval caused by Russia’s invasion of Ukraine, we have navigated our way through a storm of supply shocks. As we look ahead, the frequency of these shocks is likely to remain high.

While we have weathered these crises, the past few years have also revealed missed opportunities and underinvestment in areas such as the digital transformation and the green transition – and the uncertainty surrounding trade and economic policy continues to weigh on consumption and investment.³ As a result, and as highlighted in reports by Enrico Letta and Mario Draghi, Europe finds itself lagging behind international competitors in productivity and growth.

In a world driven by shifting global dynamics and rapid technological change, Europe must strike a delicate balance between achieving strategic autonomy and preserving its openness to the global economy. As President Ursula von der Leyen and I highlighted in a recent article, Europe’s response to these challenges must be bold and strategic. While the outlook may seem daunting, the prospects are more promising than they might appear.⁴

One of Europe’s first priorities should be to deepen the Internal Market. By removing remaining barriers within the Single Market – barriers that effectively function like tariffs – we can unlock economies of scale, encourage innovation and reduce costs for consumers and producers alike. We are already home to a wealth of ideas and innovators. Our challenge is to transform these ideas into technologies that fuel economic growth. To do so, we need to reduce administrative burdens and foster an innovation-friendly environment.

Another critical area is enhancing Europe’s autonomy in payments, which form the backbone of our economy and our single currency. At present, a few foreign providers dominate Europe’s payments landscape, leaving us vulnerable to external pressures. As we face an increasingly digital future, we must prepare the ground for a digital euro. This will ensure the resilience and public good nature of our payment systems. It will also provide a platform for private innovation in digital payments.

With substantial savings at its disposal, Europe must channel more resources into private investment and scale up financing to support its innovators. A genuine capital markets union designed for citizens and businesses alike will be instrumental here.

More broadly, investment must be the cornerstone of Europe’s economic transformation. The focus must be on investing in physical and digital infrastructure, research and development, and green technologies. These are not optional but essential investments required to drive productivity and guarantee Europe’s competitiveness on the global stage. Moreover, they will address our energy dependence and help us meet our climate goals – both pressing imperatives.

In this regard, we welcome the European Commission’s Competitiveness Compass as a concrete roadmap for action, which will also support the ECB in maintaining price stability by reducing Europe’s susceptibility to supply shocks.

That said, the ECB is not standing idle. We are committed to learning from the experiences of recent years. As part of the ongoing assessment of our monetary policy strategy, we are preparing for the risk of an increasingly volatile future. We are taking stock of a changed inflation environment and economic context. We are also focusing on the implications for monetary policy, our experiences with our evolving policy toolkit, our reaction function and how to better deal with risk and uncertainty in policy setting and communications. While the ECB continuously evaluates and adapts its economic models – a topic raised in your resolution – assessing new analytical needs will be one component of this assessment.

Conclusion

Let me conclude.

The challenges facing Europe are immense, but solutions are within our reach. Our opportunity lies in more Europe.

As Konrad Adenauer said 70 years ago, “European unity was the dream of a few. It became the hope for many. Today it is a necessity for all of us.” This sentiment rings true today more than ever.

To jointly tackle Europe’s challenges, I am counting on the Parliament’s commitment. Within its mandate, the ECB will play its part. Ever since the introduction of the euro, the ECB has continuously adapted to changing economic environments to fulfil its mandate. We remain fully committed to delivering on this mandate. We are equally committed to maintaining our active and meaningful dialogue with the Parliament.

Thank you for your attention.

MIL OSI Economics –

February 11, 2025
MIL-OSI Africa: International Monetary Fund (IMF) Staff Completes 2025 Article IV Consultation with Morocco
Source: Africa Press Organisation – English (2) – Report:

RABAT, Morocco, February 11, 2025/APO Group/ —
- Economic growth is accelerating thanks to strong domestic demand, amid a new investment cycle in many sectors.
- Tax reforms have allowed the fiscal deficit in 2024 to be lower than expected while also funding spending measures. Going forward, saving part of the revenue windfall would help strengthen the fiscal buffers. The current monetary policy stance is appropriate and should remain data dependent.
- Structural reforms should focus on strengthening job creation, including by better targeting active labor market polices, consolidating programs to support small and medium firms, and removing regulatory distortions that hinder firms’ growth.
An International Monetary Fund (IMF) staff team led by Roberto Cardarelli conducted discussions with the Moroccan authorities in Rabat on the 2025 Article IV Consultation from January 27 to February 7. At the conclusion of the visit, Mr. Cardarelli issued the following statement:

“Economic activity is expected to have grown by 3.2 percent in 2024 and to accelerate to 3.9 percent in 2025, as agricultural output rebounds after the recent droughts and the nonagricultural sector continues to expand at a robust pace amid strong domestic demand. Higher growth is expected to increase the current account deficit towards its estimated medium-term norm of around 3 percent, while inflation is expected to stabilize at around 2 percent. The risks to the outlook are broadly balanced, with significant uncertainty regarding the economic impact of geopolitical tensions and changing climate conditions.

“With inflation expectations anchored around 2 percent and little signs of demand pressures, the current broadly neutral monetary policy stance is appropriate, and staff agrees with Bank Al-Maghrib that future changes of policy rates should remain data dependent. With inflation back to around 2 percent, Bank Al-Maghrib should continue its preparation to adopt an inflation-targeting framework.”

“Recent reforms to the tax system and tax administration have helped expand the tax base while lowering the tax burden. As a result, tax revenues in 2024 have been greater than expected. With only a small part of the additional tax revenues being saved, the central government’s deficit for the year was 4.1 percent of GDP compared to the 4.3 announced in the 2024 Budget. While the 2025 Budget confirms the gradual pace of fiscal adjustment projected last year, higher-than-expected revenues should be used to accelerate the pace of debt reduction to levels closer to pre-pandemic. In addition, continuing to finance structural reforms may require further efforts to expand the tax base and rationalize spending, including by reducing transfers to state-owned enterprises as part of the ongoing reform of the sector and expanding the use of the Unified Social Registry to all social programs.

“Staff welcomes the ongoing reform of the Organic Budget Law that should introduce a new fiscal rule based on a medium-term debt anchor. Good progress has been made in the Medium-Term fiscal framework to include an assessment of the risk from climate change. Staff encourages the authorities to build on this progress by adding more information on the impact of new policy measures and a quantification of the risks from the increased reliance on public-private partnership (PPP) projects.

“Stronger job creation requires a novel approach to active labor market policies, focusing on labor displaced from the agricultural sector due to the sequence of droughts. A special focus should be placed on encouraging the growth of small and medium size enterprises (SME) and favoring their integration into sectoral value chains. Staff welcomes the progress in the operationalization of the Mohammed VI Investment Fund that should help SMEs access equity financing. Measures that may encourage the development of a more buoyant private sector include strengthening the support for SMEs under the new Charter of Investment, strengthening regional investment centers so they can better help SMEs access the financial and technical resources needed for their growth, and reviewing the labor code, tax system, and regulatory and governance frameworks so as remove the distortion that incentivize firms to remain small or informal. It will also be necessary that the ongoing SOE reform effectively pursues market neutrality between public and private sector firms.

“The IMF team held discussions with senior officials of the government of Morocco, Bank Al-Maghrib, and representatives of the public and private sectors. The team thanks the Moroccan authorities and other stakeholders for their hospitality and candid and productive discussions.”

MIL OSI Africa –
February 11, 2025
MIL-OSI Economics: Adriana D Kugler: Entrepreneurship and aggregate productivity

Source: Bank for International Settlements

Thank you, Jon, and thank you for the opportunity to speak to you today. It is such a pleasure to be back in Miami, a city I have seen grow and become ever more dynamic over the decades, as I have come many times to visit my large extended family here ever since the 1980s.

As I discussed in my final speech of 2024, two positive supply shocks have significantly benefited the U.S. economy over the past two years and have also affected the conduct of monetary policy.

The first of these has been the surge in population over the past few years that has helped bring labor supply into balance with labor demand and, thus, also helped move inflation toward the Federal Open Market Committee’s (FOMC) 2 percent goal. The other positive supply shock, which I outlined in my remarks in December, has been a step-up in aggregate productivity growth since 2020, which is an increase in the amount of economic output, across the economy, per hour worked or some other unit of labor. Although productivity growth, measured quarterly, can be quite volatile, over the past five years this acceleration is quite evident. While productivity grew by about 1.5 percent a year from 2005 to 2019, starting in 2020 it has grown about 2 percent a year. This difference may not look dramatic, but because of compounding year-over-year, the consequences of an additional 1/2 percentage point in growth over the past five years are significant for workers and the U.S. economy. When workers are more productive, it effectively means that businesses can produce more without needing to add workers, and that they can pay workers more without needing to raise prices. When they are more productive, it can also serve as an incentive for businesses to expand. Across the economy, higher productivity growth means that real wages and living standards for workers can rise faster without putting upward pressure on inflation.

And that is exactly what has been happening recently, a period when inflation has been falling while the economy is expanding. While fast growth in wages was one of the factors driving inflation in 2021 and 2022, most likely some of that increase was due to productivity growth and, hence, was not inflationary. If productivity continues to grow at an accelerated pace, it would support the FOMC’s efforts to keep unemployment low and return inflation to a sustained level of 2 percent. For that reason, I would like to spend the balance of my remarks exploring some of the possible reasons why productivity has accelerated, and the prospects that this fortunate development will continue.

MIL OSI Economics –

February 11, 2025
MIL-OSI Economics: Tiff Macklem: Structural change, supply shocks and hard choices

Source: Bank for International Settlements

Good afternoon. I’m pleased to be able to join you virtually to talk about the challenges that lie ahead for central banks. There’s a lot to discuss.

But my first order of business is to congratulate and thank Agustín Carstens for his leadership as General Manager of the Bank for International Settlements (BIS). Your term, Agustín, has been marked by significant global upheaval-from pandemic shutdowns to war in Europe and double-digit inflation. These past few years have not been easy.

Through it all, you have been a source of unwavering wisdom. Your clear thinking in the face of the unknown, your long view and your deep understanding of our global interdependence-all combined with the experience and pragmatism of a former minister of finance and then central bank governor-have made you an invaluable leader.

More than that, through the BIS, you’ve brought us together with your friendship and your ability to get directly to the heart of the issue. You’ve helped us learn from each other. And you’ve made us better together.

I know there will be an opportunity to celebrate you in Basel as your retirement in June approaches. But I wanted to recognize your exceptional leadership in your home country. For those of us in the Americas, your special interest in our region has been deeply appreciated. Whatever you do next, I know Mexico and the Americas will be an important part. Thank you, my friend.

Now, let me turn to the challenges ahead. We are facing a global economic landscape that has shifted in recent years, and this shift has important implications for central banks.

As Agustín has highlighted in a series of insightful speeches, the structural tailwinds of peace, globalization and demographics are turning into headwinds-and the world looks increasingly shock-prone.

Higher long-term interest rates, elevated sovereign debt, slower economic growth and lagging productivity make all of our economies more vulnerable. Compounding these vulnerabilities are war, rising trade protectionism and economic fragmentation. In addition, new technologies-including artificial intelligence-are set to disrupt existing industries and create new ones. And we are seeing more frequent catastrophic weather events as the impacts of climate change become more pervasive.

As 2025 begins, we are facing new uncertainty with a shift in policy direction in the United States. President Donald Trump’s threats of new tariffs are already affecting business and household confidence, particularly in Canada and Mexico. The longer this uncertainty persists, the more it will weigh on economic activity in our countries.

If significant broad-based tariffs are indeed imposed, they will test the resilience of our economies in the short run and reduce long-run prosperity. Tariffs mean economies work less efficiently. There will be less investment and lower productivity. That means our countries will produce less and earn less. Monetary policy can’t change that.

What monetary policy can do is help with the short-run adjustment. But even here, monetary policy has to strike a balance. Significant, broad-based tariffs will sharply reduce demand for our exports. At the same time, a weaker exchange rate, retaliatory tariffs and supply chain disruptions will raise import prices, putting upward pressure on inflation.

With a single instrument-our policy interest rate-central banks can’t lean against weaker output and higher inflation at the same time. So we will need to carefully assess the downward pressure on inflation from weaker economic activity, and weigh that against the upward pressures from higher input prices and supply chain disruptions.

Other structural headwinds pose similar challenges for monetary policy. They’ll impact both demand and supply, slowing growth while adding cost. Monetary policy cannot address these headwinds directly or offset their economic consequences.

In a world with more structural change and more negative supply shocks, central banks will be faced with harder choices. And harder choices bring risks of public disappointment and frustration. We will face criticism about our decisions-and about how well monetary policy is seen to have worked when confronted with forces that are mostly out of our hands. We will be called ineffective or criticized for not doing enough. And some will challenge our independence.

So, what can all of us do?

First, we can be humble about what we don’t know, but also confident in the effectiveness of our frameworks. We didn’t get everything right through the pandemic. And elevated inflation and higher interest rates have been difficult for our citizens. But in Canada, as in many other countries, inflation has come down. And we restored low inflation without causing a recession or major job losses.

Guided by our frameworks, we can maintain confidence in price stability.

Second, we can be just as clear about what monetary policy cannot do. There will always be forces beyond our influence, and while we need to understand those forces, we should also be clear that understanding is not the same as controlling. And we need to avoid the temptation to overload monetary policy by expecting more of it than it can deliver.

Third, we can recognize that the world has changed. Structural headwinds and supply shocks require different types of information and analysis. This means investing in richer information about the supply side of the economy and building models that can analyze sectoral shocks and their transmission. It means reaching out and listening to households and businesses. It means looking at our economies through different lenses, regularly challenging our assumptions, and using scenarios to help manage uncertainty.

Fourth, let’s acknowledge that working together has never been easy and it’s getting harder. But let’s also remember that it’s important. We are more effective if we confront our shared challenges together. The shared resolve of central banks to fight the post-pandemic surge in inflation helped all of us bring inflation down. This was a positive international spillover and, together, we can generate other positive international spillovers.

Finally, we need to remain evidence-based, technocratic and professional, and free of political influence. We need to be open, accountable and transparent. And we need to be learning institutions-when faced with valid criticism, we should critically evaluate our policy actions and be willing to improve. Being independent and accountable and continuously learning is how we build trust.

The world is a tougher place today than it was a few short years ago. And facing the headwinds before us will not be easy. But that’s why we have independent central banks-we are designed for tough times.

I look forward to hearing from my esteemed colleagues on this panel.

MIL OSI Economics –

February 11, 2025

MIL-OSI: International Petroleum Corporation Announces 2024 Year-End Financial and Operational Results and 2025 Budget, Reserves and Guidance

Source: GlobeNewswire (MIL-OSI)

TORONTO, Feb. 11, 2025 (GLOBE NEWSWIRE) — International Petroleum Corporation (IPC or the Corporation) (TSX, Nasdaq Stockholm: IPCO) today released its financial and operating results and related management’s discussion and analysis (MD&A) for the three months and year ended December 31, 2024. IPC is also pleased to announce its 2025 budget, including that IPC continues to progress the development of the Blackrod Phase 1 project in Canada in line with schedule and budget. IPC previously announced the renewal of the normal course issuer bid (NCIB) under which IPC may acquire a further 5.3 million common shares up to December 2025, in addition to the 2.2 million common shares already purchased for cancellation under the NCIB in December 2024 and January 2025. IPC’s 2025 capital and decommissioning expenditure budget is USD 320 million and its 2025 average daily production guidance is between 43,000 and 45,000 barrels of oil equivalent (boe) per day (boepd). 2024 year-end proved plus probable (2P) reserves are 493 million boe (MMboe) and best estimate contingent resources (unrisked) are 1,107 MMboe.⁽¹⁾⁽²⁾

William Lundin, IPC’s President and Chief Executive Officer, comments: “We are very pleased to announce that IPC achieved strong operational results in 2024. Our average net production was 47,400 boepd for the full year, with very strong operational and ESG performance across all our areas of operation. 2024 was a very significant investment year for our Blackrod Phase 1 development project, and we have spent over two-thirds of the forecast capital expenditure by the end of 2024. We generated strong cash flows from our business, and we returned USD 102 million to shareholders through share buybacks in 2024. With gross cash resources of USD 247 million at 2024 year-end, we continue to be well positioned to deliver on our three strategic pillars of Organic Growth, Stakeholder Returns, and M&A that drive value creation for our stakeholders.⁽¹⁾⁽³⁾

On Organic Growth, we are very pleased with the progress of the development of Phase 1 of the Blackrod project, Canada, which remains in line with schedule and budget. Phase 1 of the Blackrod project continues to forecast first oil in late 2026, with peak production planned to increase to 30,000 bopd by 2028. In 2024, IPC achieved over 250% reserves replacement ratio, ending the year with 493 MMboe of 2P reserves, the highest in our history.⁽¹⁾⁽²⁾

On Stakeholder Returns, we completed the 2023/2024 NCIB program, purchasing and cancelling 8.3 million IPC common shares over the period of December 5, 2023 to December 4, 2024, representing approximately 6.5% of the common shares outstanding at the start of that program. We immediately recommenced purchasing under the renewed 2024/2025 NCIB, purchasing for cancellation 0.8 million common shares during December 2024 and over 1.4 million common shares during January 2024. We are permitted to purchase up to a further 5.3 million common shares by early December 2025, which will represent a 6.2% reduction in the number of shares common outstanding at the beginning of the 2024/2025 NCIB.

On M&A, we continue to review potential opportunities in Canada and internationally. IPC’s principal focus continues to be on progressing the Blackrod Phase 1 development as well as developing our existing asset base in Canada, France and Malaysia.

IPC is well-positioned for 2025 and beyond as our Blackrod Phase 1 project is progressing according to plan, our existing production operations continue to generate strong cash flows, and our balance sheet is strong. At the same time, we continue return value to our shareholders by repurchasing and cancelling our common shares under the NCIB. I look forward to another exciting year at IPC with our high quality assets and our highly skilled and motivated teams across all areas of operation.”

2024 Business Highlights

Average net production of approximately 47,400 boepd for the fourth quarter of 2024 was in line with the guidance range for the period (51% heavy crude oil, 15% light and medium crude oil and 34% natural gas).⁽¹⁾
Full year 2024 average net production was 47,400 boepd, above the mid-point of the 2024 annual guidance of 46,000 to 48,000 boepd.⁽¹⁾
Development activities on Phase 1 of the Blackrod project progressed in 2024 on schedule and on budget, with forecast first oil in late 2026. All major third-party contracts have been executed and construction is advancing according to plan, including construction of the central processing facility (CPF) and well pad facilities, finalization of the midstream agreements for the input fuel gas, diluent and oil blend pipelines, and advancement of drilling operations. As at the end of 2024, over two-thirds of the forecast Blackrod Phase 1 development capital expenditure of USD 850 million has been spent since project sanction in early 2023.
Drilling activity at the Southern Alberta assets in Canada continued with a total of thirteen wells drilled during 2024.
Successful completion of planned maintenance shutdowns at Onion Lake Thermal (OLT) in Canada and the Bertam field in Malaysia during 2024.
8.3 million common shares purchased and cancelled from December 2023 to early December 2024 under IPC’s 2023/2024 NCIB and a further 2.2 million common shares purchased for cancellation during December 2024 and January 2025 under the renewed 2024/2025 NCIB.
In Q3 2024, published IPC’s fifth annual Sustainability Report.

2024 Financial Highlights

Operating costs per boe of USD 18.2 for the fourth quarter of 2024 and USD 17.0 for the full year, in line with the most recent 2024 guidance of less than USD 18.0 per boe for the full year.⁽³⁾
Strong operating cash flow (OCF) generation for the fourth quarter and full year 2024 amounted to MUSD 78 and MUSD 342, respectively.⁽³⁾
Capital and decommissioning expenditures of MUSD 129 for the fourth quarter and MUSD 442 for the full year 2024, in line with the full year guidance of MUSD 437.
Free cash flow (FCF) generation for the full year 2024 of negative MUSD 135, with negative FCF generation of MUSD 61 for the fourth quarter in line with expectations and taking into account the significant capital expenditures during the quarter in respect of the Blackrod project. FCF for the full year 2024, before 2024 Blackrod Phase 1 development expenditure of MUSD 351, was MUSD 216.⁽³⁾
Net debt of MUSD 209 and gross cash of MUSD 247 as at December 31, 2024.⁽³⁾
Net result of MUSD 0.4 for the fourth quarter of 2024 and MUSD 102 for the full year 2024.
Entered into a letter of credit facility in Canada during 2024 to cover operational letters of credit, giving full availability under IPC’s undrawn CAD 180 million Revolving Credit Facility.

Reserves and Resources

Total 2P reserves as at December 31, 2024 of 493 MMboe, with a reserve life index (RLI) of 31 years.⁽¹⁾⁽²⁾
Contingent resources (best estimate, unrisked) as at December 31, 2024 of 1,107 MMboe.⁽¹⁾⁽²⁾
2P reserves net asset value (NAV) as at December 31, 2024 of MUSD 3,083 (10% discount rate).^(1)(2)(⁵⁾⁽⁶⁾

2025 Annual Guidance

Full year 2025 average net production forecast at 43,000 to 45,000 boepd.⁽¹⁾
Full year 2025 operating costs forecast at USD 18 to 19 per boe.⁽³⁾
Full year 2025 OCF guidance estimated at between MUSD 210 and 280 (assuming Brent USD 65 to 85 per barrel).⁽³⁾
Full year 2025 capital and decommissioning expenditures guidance forecast at MUSD 320, including MUSD 230 relating to Blackrod capital expenditure.
Full year 2025 FCF ranges from approximately MUSD 80 to 150 (assuming Brent USD 65 to 85 per barrel) before taking into account proposed Blackrod capital expenditures, or negative MUSD 150 to 80 including proposed Blackrod capital expenditures.⁽³⁾

Business Plan Production and Cash Flow Guidance

2025 – 2029 business plan forecasts:
- average net production forecast approximately 57,000 boepd.⁽¹⁾⁽⁸⁾
- capital expenditure forecast of USD 8 per boe, including USD 3 per boe for growth expenditure.⁽⁸⁾
- operating costs forecast of USD 18 to 19 per boe.⁽³⁾⁽⁸⁾
- FCF forecast of approximately MUSD 1,200 to 2,000 (assuming Brent USD 75 to 95 per barrel).⁽³⁾⁽⁸⁾
2030 – 2034 business plan forecasts:
- average net production forecast of approximately 63,000 boepd.⁽¹⁾⁽⁸⁾
- capital expenditure forecast of USD 5 per boe.⁽⁸⁾
- operating costs forecast of USD 18 to 19 per boe.⁽³⁾⁽⁸⁾
- FCF forecast of approximately MUSD 1,600 to 2,600 (assuming Brent USD 75 to 95 per barrel).⁽³⁾⁽⁸⁾

	Three months ended December 31				Year ended December 31
USD Thousands	2024		2023		2024		2023
Revenue	199,124		198,460		797,783		853,906
Gross profit	42,774		39,955		210,171		250,514
Net result	415		29,710		102,219		172,979
Operating cash flow ⁽³⁾	78,158		73,634		341,989		353,048
Free cash flow ⁽³⁾	(61,476	)	(64,688	)	(135,497	)	2,689
EBITDA ⁽³⁾	76,184		66,284		335,488		350,618
Net Cash / (Debt) ⁽³⁾	(208,528	)	58,043		(208,528	)	58,043

IPC was launched in 2017 by way of spinning off the non-Norwegian assets from Lundin Energy. The strategy and vision from the outset was to be the international E&P growth vehicle for the Lundin Group by pursuing growth organically and through acquisitions. The foundation of this strategy was and is predicated on maximising long-term stakeholder value through responsible business operations focused on operational excellence and financial resilience to underpin optimal capital allocation decision-making.

We are very pleased with the track record of value creation achieved by the company to date. IPC’s production, reserves, resources and cash flow exposure has increased materially through accretive acquisitions supplemented by base business investment. Excluding the growth capital expenditure assigned to the Blackrod Phase 1 development, over USD 1.5 billion in free cash flow (FCF) has been generated and over USD 0.5 billion has been returned to shareholders in the form of share buybacks since inception. IPC’s current shares outstanding are less than 5% higher than the original shares outstanding upon the formation of the company. IPC is determined to build on the historical success and the growth outlook has never been brighter.⁽³⁾

2024 was a milestone year for the company through successfully delivering the largest capital investment campaign in its history. The record investment was accompanied by strong safety, operational and financial performance. IPC returned USD 102 million of value to shareholders in the year through share repurchases, whilst maintaining a strong balance sheet.

Oil prices were rangebound in 2024 between Brent USD 70 to 90 per barrel, with a full year Brent average of USD 81 per barrel, in line with our original oil price sensitivities guided at CMD. The fourth quarter 2024 Brent price averaged USD 75 per barrel, the lowest quarterly price average in the year. The downward trend in benchmark oil prices through the second half of 2024 has been slightly reversed in current time as continuous crude inventory draws, strong demand, underwhelming non-OPEC production growth and continued OPEC production curtailments have supported the market balance. A new administration in the White House presents uncertainty for the oil market, as looming tariffs and sanctions pose a risk to global supply chain systems and trade flows. Around 40% of our 2025 Dated Brent and WTI exposure is hedged at USD 76 per barrel and USD 71 per barrel respectively.

The fourth quarter 2024 WTI to WCS price differentials averaged less than USD 13 per barrel, around USD 2 per barrel lower than the full year average of USD 15 per barrel. The fourth quarter differential was the lowest quarterly average since the Covid pandemic in 2020 when benchmark oil prices were more than USD 30 per barrel less than current levels. The TMX pipeline is driving the tighter differentials with excess take-away capacity in the Western Canadian Sedimentary Basin (WCSB) relative to supply. Close to 50% of our 2025 WCS to WTI differential exposure is hedged at USD 14 per barrel, which should assist in mitigating adverse effects of potential US tariffs on Canadian production.

Natural gas prices averaged CAD 1.5 per Mcf for 2024 and in the fourth quarter. Western Canada gas storage levels continue to sit above the five-year range. This is in part due to delays of the LNG Canada start-up project which was supposed to be onstream at end 2024, start-up is now anticipated for mid-2025. IPC has around 9,600 Mcf per day hedged at CAD 2.6 per Mcf for 2025.

Fourth Quarter and Full Year 2024 Highlights

During the fourth quarter of 2024, IPC’s assets delivered average net production of 47,400 boepd, in line with guidance for the quarter. Full year 2024 average net production of 47,400 boepd was above the 2024 mid-point guidance range of 46,000 to 48,000 boepd.⁽¹⁾

IPC’s operating costs per boe for the fourth quarter of 2024 was USD 18.2. Full year 2024 operating costs per boe was USD 17.0, in line with the most recent 2024 annual guidance of less than USD 18 per boe.⁽³⁾

Operating cash flow (OCF) generation for the fourth quarter of 2024 was USD 78 million. Full year 2024 OCF was USD 342 million in line with the most recent guidance of USD 335 to 342 million.⁽³⁾

Capital and decommissioning expenditure for the fourth quarter of 2024 was USD 129 million. Full year 2024 capital and decommissioning expenditure of USD 442 million was in line with guidance of USD 437 million.

Free cash flow (FCF) generation was in line with guidance at negative USD 61 million during the fourth quarter of 2024, reflecting the higher level of capital expenditure on the Blackrod Phase 1 development project. Full year 2024 FCF generation was negative USD 135 million, in line with the most recent guidance of negative USD 140 to 133 million.⁽³⁾

As at December 31, 2024, IPC’s net debt position was USD 209 million. IPC’s gross cash on the balance sheet amounts to USD 247 million which provides IPC with significant financial strength to continue progressing its strategies in 2025, including advancing the Blackrod development project, returning value to shareholders through the 2024/2025 NCIB, and remaining opportunistic to mergers and acquisitions activity.⁽³⁾

Blackrod Project

The Blackrod asset is 100% owned by IPC and hosts the largest booked reserves and contingent resources within the IPC portfolio. After more than a decade of pilot operations, subsurface delineation and commercial engineering studies, IPC sanctioned the Phase 1 Steam Assisted Gravity Drainage (SAGD) development in the first quarter of 2023. The Phase 1 development targets 259 MMboe of 2P reserves, with a multi-year forecast capital expenditure of USD 850 million to first oil planned in late 2026. The Phase 1 development is planned for plateau production of 30,000 bopd which is expected by early 2028.⁽¹⁾⁽²⁾

As at the end of 2024, USD 591 million of cumulative growth capital, has been spent on the Blackrod Phase 1 development since sanction with a peak annual investment of USD 351 million incurred in 2024. Significant progress has been made across all key scopes of the project including but not limited to: detailed engineering, procurement, fabrication, drilling, construction, third party transport pipelines, commissioning and operations planning. Site health and safety control has been excellent with zero lost time incidents since commercial development activities commenced.

Looking forward, USD 230 million is planned to be spent in 2025 mainly relating to advancing the remaining fabrication, construction and substantial completion of the Central Processing Facility (CPF) for the Phase 1 development. The remaining growth capital expenditure to first oil is forecast to be spent in 2026 on drilling, completions and commissioning of the CPF with first steam anticipated by end Q1 2026.

IPC is strongly positioned to deliver within plan with a clear line of sight to start-up. The Blackrod Phase 1 project is expected to generate significant value for all our stakeholders. And with over 1 billion barrels of best estimate contingent resources (unrisked) beyond Phase 1, IPC is pleased to announce a resource maturation plan that sees significant volume maturation into reserves through low cost of less than USD 0.15 per barrel. The 2P reserves attributable to Phase 1 has increased by 40 MMboe to 259 MMboe from year end 2023 to year end 2024.⁽²⁾

As at the end of 2024, 70% of the Blackrod Phase 1 development capital had been spent since the project sanction in early 2023. All major work streams are progressing as planned and the focus continues to be on executing the detailed sequencing of events as facility modules are safely delivered and installed at site. The total Phase 1 project guidance of USD 850 million capital expenditure to first oil in late 2026 is unchanged. IPC intends to fund the remaining Blackrod Phase 1 development costs with forecast cash flow generated by its operations and cash on hand.

Stakeholder Returns: Normal Course Issuer Bid

During the period of December 5, 2023 to December 4, 2024, IPC purchased and cancelled an aggregate of approximately 8.3 million common shares under the 2023/2024 NCIB. The average price of shares purchased under the 2023/2024 NCIB was SEK 131 / CAD 17 per share.

In Q4 2024, IPC announced the renewal of the NCIB, with the ability to repurchase up to approximately 7.5 million common shares over the period of December 5, 2024 to December 4, 2025. Under the 2024/2025 NCIB, IPC repurchased and cancelled approximately 0.8 million common shares in December 2024. By the end of January 2025, IPC repurchased for cancellation over 1.4 million common shares under the 2024/2025 NCIB. The average price of common shares purchased under the 2024/2025 NCIB during December 2024 and January 2025 was SEK 135 / CAD 17.5 per share.

As at February 7, 2025, IPC had a total of 117,781,927 common shares issued and outstanding, of which IPC holds 508,853 common shares in treasury.

Under the 2024/2025 NCIB, IPC may purchase and cancel a further 5.3 million common shares by December 4, 2025. This would result in the cancellation of 6.2% of shares outstanding as at the beginning of December 2024. IPC continues to believe that reducing the number of shares outstanding while in parallel investing in material production growth at Blackrod will prove to be a winning formula for our stakeholders.

Environmental, Social and Governance (ESG) Performance

As part of IPC’s commitment to operational excellence and responsible development, IPC’s objective is to reduce risk and eliminate hazards to prevent occurrence of accidents, ill health, and environmental damage, as these are essential to the success of our business operations. During the fourth quarter and for the full year 2024, IPC recorded no material safety or environmental incidents.

As previously announced, IPC targets a reduction of our net GHG emissions intensity by the end of 2025 to 50% of IPC’s 2019 baseline and IPC remains on track to achieve this reduction. During 2024, IPC announced the commitment to remain at end 2025 levels of 20 kg CO2/boe through to the end of 2028.⁽⁴⁾

Reserves, Resources and Value

As at the end of December 2024, IPC’s 2P reserves are 493 MMboe. During 2024, IPC replaced 251% of the annual 2024 production. The reserves life index (RLI) as at December 31, 2024, is approximately 31 years.⁽¹⁾⁽²⁾

The net present value (NPV) of IPC’s 2P reserves as at December 31, 2024 was USD 3.3 billion. IPC’s net asset value (NAV) was USD 3.1 billion or SEK 287 / CAD 37 per share as at December 31, 2024.⁽¹⁾⁽²⁾⁽⁵⁾⁽⁶⁾⁽⁷⁾

In addition, IPC’s best estimate contingent resources (unrisked) as at December 31, 2024 are 1,107 MMboe, of which 1,025 MMboe relate to future potential phases of the Blackrod project.⁽¹⁾⁽²⁾

2025 Budget and Operational Guidance

IPC is pleased to announce its 2025 average net production guidance is 43,000 to 45,000 boepd. IPC forecasts operating costs for 2025 between USD 18 and 19 per boe.⁽¹⁾⁽³⁾

IPC’s 2025 capital and decommissioning expenditure budget is USD 320 million, with USD 230 million forecast relating to Blackrod capital expenditure. The remainder of the 2025 budget in Canada includes drilling and ongoing optimization work at Onion Lake Thermal and Suffield Area assets. IPC also plans to advance the next phase of infill drilling and complete well maintenance works at the Bertam field in Malaysia. IPC expects to conduct technical studies for future development potential in France. In all of IPC’s areas of operation, IPC has significant flexibility to control its pace of spend based on the development of commodity prices during 2025.

Notwithstanding a modest production decline expected in 2025, IPC’s production per share metric remains largely unchanged relative to 2024 and 2023. IPC has prioritised capital allocation to the transformational Blackrod Phase 1 development and share buybacks as opposed to further increasing its base business investment to preserve balance sheet strength and maximise long- term shareholder value.

Further details regarding IPC’s proposed 2025 budget and operational guidance will be provided at IPC’s Capital Markets Day presentation to be held on February 11, 2025 at 15:00 CET. A copy of the Capital Markets Day presentation will be available on IPC’s website at www.international-petroleum.com.

Notes:

(1) See “Supplemental Information regarding Product Types” in “Reserves and Resources Advisory” below. See also the material change report (MCR) available on IPC’s website at www.international-petroleum.com and filed on the date of this press release under IPC’s profile on SEDAR+ at www.sedarplus.ca.
(2) See “Reserves and Resources Advisory“ below. Further information with respect to IPC’s reserves, contingent resources and estimates of future net revenue, including assumptions relating to the calculation of NPV, are described in the MCR. The reserve life index (RLI) is calculated by dividing the 2P reserves of 493 MMboe as at December 31, 2024 by the mid-point of the 2025 CMD production guidance of 43,000 to 45,000 boepd. Reserves replacement ratio is based on 2P reserves of 468 boe as at December 31, 2024, sales production during 2024 of 16.6 MMboe, net additions to 2P reserves during 2024 of 41.7 MMboe, and 2P reserves of 493 MMboe as at December 31, 2024.
(3) Non-IFRS measure, see “Non-IFRS Measures” below and in the MD&A.
(4) Emissions intensity is the ratio between oil and gas production and the associated carbon emissions, and net emissions intensity reflects gross emissions less operational emission reductions and carbon offsets.
(5) Net present value (NPV) is after tax, discounted at 10% and based upon the forecast prices and other assumptions further described in the MCR. See “Reserves and Resources Advisory” below.
(6) Net asset value (NAV) is calculated as NPV less net debt of USD 209 million as at December 31, 2024.
(7) NAV per share is based on 119,059,315 IPC common shares as at December 31, 2024, being 119,169,471 common shares outstanding less 110,156 common shares held in treasury and cancelled in January 2025. NAV per share is not predictive and may not be reflective of current or future market prices for IPC common shares.
(8) Estimated FCF generation is based on IPC’s current business plans over the periods of 2025 to 2029 and 2030 to 2034, including net debt of USD 209 million as at December 31, 2024, with assumptions based on the reports of IPC’s independent reserves evaluators, and including certain corporate adjustments relating to estimated general and administration costs and hedging, and excluding shareholder distributions and financing costs. Assumptions include average net production of approximately 57 Mboepd over the period of 2025 to 2029, average net production of approximately 63 Mboepd over the period of 2030 to 2034, average Brent oil prices of USD 75 to 95 per bbl escalating by 2% per year, and average Brent to Western Canadian Select differentials and average gas prices as estimated by IPC’s independent reserves evaluator and as further described in the MCR. IPC’s market capitalization is at close on January 31, 2025 (USD 1,557 million based on 146.8 SEK/share, 117.7 million IPC shares outstanding (net of treasury shares) and exchange rate of 11.10 SEK/USD). IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts. See “Forward-Looking Statements” and “Non-IFRS Measures” below.

International Petroleum Corp. (IPC) is an international oil and gas exploration and production company with a high quality portfolio of assets located in Canada, Malaysia and France, providing a solid foundation for organic and inorganic growth. IPC is a member of the Lundin Group of Companies. IPC is incorporated in Canada and IPC’s shares are listed on the Toronto Stock Exchange (TSX) and the Nasdaq Stockholm exchange under the symbol “IPCO”.

For further information, please contact:

Rebecca Gordon SVP Corporate Planning and Investor Relations rebecca.gordon@international-petroleum.com Tel: +41 22 595 10 50		Or		Robert Eriksson Media Manager reriksson@rive6.ch Tel: +46 701 11 26 15

This information is information that International Petroleum Corporation is required to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the contact persons set out above, at 07:30 CET on February 11, 2025. The Corporation’s audited condensed consolidated financial statements (Financial Statements) and management’s discussion and analysis (MD&A) for the three months and year ended December 31, 2024 have been filed on SEDAR+ (www.sedarplus.ca) and are also available on the Corporation’s website (www.international-petroleum.com).

Forward-Looking Statements
This press release contains statements and information which constitute “forward-looking statements” or “forward-looking information” (within the meaning of applicable securities legislation). Such statements and information (together, “forward-looking statements”) relate to future events, including the Corporation’s future performance, business prospects or opportunities. Actual results may differ materially from those expressed or implied by forward-looking statements. The forward-looking statements contained in this press release are expressly qualified by this cautionary statement. Forward-looking statements speak only as of the date of this press release, unless otherwise indicated. IPC does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws.

All statements other than statements of historical fact may be forward-looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, forecasts, guidance, budgets, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “forecast”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “budget” and similar expressions) are not statements of historical fact and may be “forward-looking statements”.

Forward-looking statements include, but are not limited to, statements with respect to:

2025 production ranges (including total daily average production), production composition, cash flows, operating costs and capital and decommissioning expenditure estimates;
Estimates of future production, cash flows, operating costs and capital expenditures that are based on IPC’s current business plans and assumptions regarding the business environment, which are subject to change;
IPC’s financial and operational flexibility to navigate the Corporation through periods of volatile commodity prices;
The ability to fully fund future expenditures from cash flows and current borrowing capacity;
IPC’s intention and ability to continue to implement its strategies to build long-term shareholder value;
The ability of IPC’s portfolio of assets to provide a solid foundation for organic and inorganic growth;
The continued facility uptime and reservoir performance in IPC’s areas of operation;
Development of the Blackrod project in Canada, including estimates of resource volumes, future production, timing, regulatory approvals, third party commercial arrangements, breakeven oil prices and net present values;
Current and future production performance, operations and development potential of the Onion Lake Thermal, Suffield, Brooks, Ferguson and Mooney operations, including the timing and success of future oil and gas drilling and optimization programs;
The potential improvement in the Canadian oil egress situation and IPC’s ability to benefit from any such improvements;
The ability of IPC to achieve and maintain current and forecast production in France and Malaysia;
The intention and ability of IPC to acquire further common shares under the NCIB, including the timing of any such purchases;
The return of value to IPC’s shareholders as a result of the NCIB;
IPC’s ability to implement its GHG emissions intensity and climate strategies and to achieve its net GHG emissions intensity reduction targets;
IPC’s ability to implement projects to reduce net emissions intensity, including potential carbon capture and storage;
Estimates of reserves and contingent resources;
The ability to generate free cash flows and use that cash to repay debt;
IPC’s continued access to its existing credit facilities, including current financial headroom, on terms acceptable to the Corporation;
IPC’s ability to identify and complete future acquisitions;
Expectations regarding the oil and gas industry in Canada, Malaysia and France, including assumptions regarding future royalty rates, regulatory approvals, legislative changes, and ongoing projects and their expected completion; and
Future drilling and other exploration and development activities.

Statements relating to “reserves” and “contingent resources” are also deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described exist in the quantities predicted or estimated and that the reserves and resources can be profitably produced in the future. Ultimate recovery of reserves or resources is based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.

Although IPC believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because IPC can give no assurances that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks.

These include, but are not limited to general global economic, market and business conditions, the risks associated with the oil and gas industry in general such as operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of estimates and projections relating to reserves, resources, production, revenues, costs and expenses; health, safety and environmental risks; commodity price fluctuations; interest rate and exchange rate fluctuations; marketing and transportation; loss of markets; environmental and climate-related risks; competition; incorrect assessment of the value of acquisitions; failure to complete or realize the anticipated benefits of acquisitions or dispositions; the ability to access sufficient capital from internal and external sources; failure to obtain required regulatory and other approvals; and changes in legislation, including but not limited to tax laws, royalties, environmental and abandonment regulations.

Additional information on these and other factors that could affect IPC, or its operations or financial results, are included in the MD&A (See “Risk Factors”, “Cautionary Statement Regarding Forward-Looking Information” and “Reserves and Resources Advisory” therein), the Corporation’s material change report dated February 11, 2025 (MCR), the Corporation’s Annual Information Form (AIF) for the year ended December 31, 2023, (See “Cautionary Statement Regarding Forward-Looking Information”, “Reserves and Resources Advisory” and “Risk Factors”) and other reports on file with applicable securities regulatory authorities, including previous financial reports, management’s discussion and analysis and material change reports, which may be accessed through the SEDAR+ website (www.sedarplus.ca) or IPC’s website (www.international-petroleum.com).

Management of IPC approved the production, operating costs, operating cash flow, capital and decommissioning expenditures and free cash flow guidance and estimates contained herein as of the date of this press release. The purpose of these guidance and estimates is to assist readers in understanding IPC’s expected and targeted financial results, and this information may not be appropriate for other purposes.

Estimated FCF generation is based on IPC’s current business plans over the periods of 2025 to 2029 and 2030 to 2034, including net debt of USD 209 million as at December 31, 2024, with assumptions based on the reports of IPC’s independent reserves evaluators, and including certain corporate adjustments relating to estimated general and administration costs and hedging, and excluding shareholder distributions and financing costs. Assumptions include average net production of approximately 57 Mboepd over the period of 2025 to 2029, average net production of approximately 63 Mboepd over the period of 2030 to 2034, average Brent oil prices of USD 75 to 95 per bbl escalating by 2% per year, and average Brent to Western Canadian Select differentials and average gas prices as estimated by IPC’s independent reserves evaluator and as further described in the MCR. IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.

Non-IFRS Measures
References are made in this press release to “operating cash flow” (OCF), “free cash flow” (FCF), “Earnings Before Interest, Tax, Depreciation and Amortization” (EBITDA), “operating costs” and “net debt”/”net cash”, which are not generally accepted accounting measures under International Financial Reporting Standards (IFRS) and do not have any standardized meaning prescribed by IFRS and, therefore, may not be comparable with similar measures presented by other public companies. Non-IFRS measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS.

The definition of each non-IFRS measure is presented in IPC’s MD&A (See “Non-IFRS Measures” therein).

Operating cash flow
The following table sets out how operating cash flow is calculated from figures shown in the Financial Statements:

	Three months ended December 31				Year ended December 31
USD Thousands	2024		2023		2024		2023
Revenue	199,124		198,460		797,783		853,906
Production costs and net sales of diluent to third party¹	(119,371	)	(126,414	)	(447,481	)	(491,303	)
Current tax	(1,595	)	1,588		(8,313	)	(14,457	)
Operating cash flow	78,158		73,634		341,989		348,146

¹ Include net sales of diluent to third party amounting to USD 737 thousand for the fourth quarter of 2024 and the year ended December 31, 2024.

The operating cash flow for the year ended December 31, 2023 including the operating cash flow contribution of the Brooks assets acquisition from the effective date of January 1, 2023 to the completion date of March 3, 2023 amounted to USD 353,048 thousand.

Free cash flow
The following table sets out how free cash flow is calculated from figures shown in the Financial Statements:

	Three months ended December 31				Year ended December 31
USD Thousands	2024		2023		2024		2023
Operating cash flow – see above	78,158		73,634		341,989		348,146
Capital expenditures	(126,256	)	(128,825	)	(434,713	)	(312,729	)
Abandonment and farm-in expenditures¹	(3,364	)	(1,516	)	(8,302	)	(9,199	)
General, administration and depreciation expenses before depreciation²	(3,569	)	(5,762	)	(14,814	)	(16,886	)
Cash financial items³	(6,445	)	(2,219	)	(19,657	)	(5,812	)
Free cash flow	(61,476	)	(64,688	)	(135,497	)	3,520

¹ See note 19 to the Financial Statements
² Depreciation is not specifically disclosed in the Financial Statements
³ See notes 5 and 6 to the Financial Statements

The free cash flow for the year ended December 31, 2023 including the free cash flow contribution of the Brooks assets acquisition from the effective date of January 1, 2023 to the completion date of March 3, 2023 amounted to USD 2,689 thousand. Free cash flow is before shareholder distributions and financing costs.

EBITDA
The following table sets out the reconciliation from net result from the consolidated statement of operations to EBITDA:

	Three months ended December 31				Year ended December 31
USD Thousands	2024		2023		2024		2023
Net result	415		29,710		102,219		172,979
Net financial items	35,767		6,509		59,709		22,736
Income tax	3,852		4,691		33,325		55,362
Depletion and decommissioning costs	32,087		30,434		128,392		101,922
Depreciation of other tangible fixed assets	2,430		1,309		8,933		7,812
Exploration and business development costs	1,725		348		2,069		2,355
Depreciation included in general, administration and depreciation expenses¹	308		389		1,241		1,569
Sale of assets²	(400	)	(7,106	)	(400	)	(19,018	)
EBITDA	76,814		66,284		335,488		345,717

¹ Item is not shown in the Financial Statements
² Sale of assets is included under “Other income/(expense)” but not specifically disclosed in the Financial Statements

The EBITDA for the year ended December 31, 2023 including the EBITDA contribution of the Brooks assets acquisition from the effective date of January 1, 2023 to the completion date of March 3, 2023 amounted to USD 350,618 thousand.

Operating costs
The following table sets out how operating costs is calculated:

	Three months ended December 31				Year ended December 31
USD Thousands	2024		2023		2024		2023
Production costs	120,108		126,414		448,218		491,303
Cost of blending	(36,036	)	(44,473	)	(152,735	)	(172,996	)
Change in inventory position	(4,633	)	1,427		(1,473	)	3,655
Operating costs	79,439		83,368		294,010		321,962

The operating costs for the year ended December 31, 2023 including the operating costs contribution of the Brooks assets acquisition from the effective date of January 1, 2023 to the completion date of March 3, 2023 amounted to USD 328,763 thousand.

Net cash / (debt)
The following table sets out how net cash / (debt) is calculated from figures shown in the Financial Statements:

USD Thousands	December 31, 2024		December 31, 2023
Bank loans	(5,121	)	(9,031	)
Bonds¹	(450,000	)	(450,000	)
Cash and cash equivalents	246,593		517,074
Net cash / (debt)	(208,528	)	58,043

¹ The bond amount represents the redeemable value at maturity (February 2027).

Reserves and Resources Advisory
This press release contains references to estimates of gross and net reserves and resources attributed to the Corporation’s oil and gas assets. For additional information with respect to such reserves and resources, refer to “Reserves and Resources Advisory” in the MD&A and the MCR. Light, medium and heavy crude oil reserves/resources disclosed in this press release include solution gas and other by-products. Also see “Supplemental Information regarding Product Types” below.

Reserve estimates, contingent resource estimates and estimates of future net revenue in respect of IPC’s oil and gas assets in Canada are effective as of December 31, 2024, and are included in the reports prepared by Sproule Associates Limited (Sproule), an independent qualified reserves evaluator, in accordance with National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities (NI 51-101) and the Canadian Oil and Gas Evaluation Handbook (the COGE Handbook) and using Sproule’s December 31, 2024 price forecasts.

Reserve estimates, contingent resource estimates and estimates of future net revenue in respect of IPC’s oil and gas assets in France and Malaysia are effective as of December 31, 2024, and are included in the report prepared by ERC Equipoise Ltd. (ERCE), an independent qualified reserves auditor, in accordance with NI 51-101 and the COGE Handbook, and using Sproule’s December 31, 2024 price forecasts.

The price forecasts used in the Sproule and ERCE reports are available on the website of Sproule (sproule.com) and are contained in the MCR. These price forecasts are as at December 31, 2024 and may not be reflective of current and future forecast commodity prices.

The reserve life index (RLI) is calculated by dividing the 2P reserves of 493 MMboe as at December 31, 2024 by the mid-point of the 2025 CMD production guidance of 43,000 to 45,000 boepd. Reserves replacement ratio is based on 2P reserves of 468 MMboe as at December 31, 2023, sales production during 2024 of 16.6 MMboe, net additions to 2P reserves during 2024 of 41.7 MMboe and 2P reserves of 493 MMboe as at December 31, 2024.

The reserves and resources information and data provided in this press release present only a portion of the disclosure required under NI 51-101. All of the required information will be contained in the Corporation’s Annual Information Form for the year ended December 31, 2024, which will be filed on SEDAR+ (accessible at www.sedarplus.ca) on or before April 1, 2025. Further information with respect to IPC’s reserves, contingent resources and estimates of future net revenue, including assumptions relating to the calculation of net present value and other relevant information related to the contingent resources disclosed, is disclosed in the MCR available under IPC’s profile on www.sedarplus.ca and on IPC’s website at www.international-petroleum.com.

IPC uses the industry-accepted standard conversion of six thousand cubic feet of natural gas to one barrel of oil (6 Mcf = 1 bbl). A BOE conversion ratio of 6:1 is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a 6:1 conversion basis may be misleading as an indication of value.

Supplemental Information regarding Product Types

The following table is intended to provide supplemental information about the product type composition of IPC’s net average daily production figures provided in this press release:

	Heavy Crude Oil (Mbopd)	Light and Medium Crude Oil (Mbopd)	Conventional Natural Gas (per day)	Total (Mboepd)
Three months ended
December 31, 2024	24.3	7.1	95.9 MMcf (16.0 Mboe)	47.4
December 31, 2023	25.7	6.6	103.8 MMcf (17.3 Mboe)	49.6
Year ended
December 31, 2024	23.9	7.7	95.1 MMcf (15.8 Mboe)	47.4
December 31, 2023	25.8	8.1	102.8 MMcf (17.1 Mboe)	51.1

This press release also makes reference to IPC’s forecast total average daily production of 43,000 to 45,000 boepd for 2025. IPC estimates that approximately 55% of that production will be comprised of heavy oil, approximately 12% will be comprised of light and medium crude oil and approximately 33% will be comprised of conventional natural gas.

Currency
All dollar amounts in this press release are expressed in United States dollars, except where otherwise noted. References herein to USD mean United States dollars. References herein to CAD mean Canadian dollars.

The MIL Network –

February 11, 2025

MIL-OSI: Unaudited financial results of LHV Group for Q4 and 12 months of 2024

Source: GlobeNewswire (MIL-OSI)

The year-end was a successful one for LHV, supported by strong loan issue and deposit taking. The company met the profit target set in the financial plan.

In 2024, AS LHV Group generated net revenue of 338.3 million euros, i.e., 11% more than in the previous year, thanks to strong business growth. Annual net interest income increased to 273.3 million euros (+8%) and net fee and commission income to 60.3 million euros (+24%). Consolidated expenditure for 2024 totalled 146.9 million euros, i.e., 14% higher than the previous year. The consolidated net profit of AS LHV Group in 2024 was 150.3 million euros, i.e., 9.4 million euros more than in 2023 (+7%).

Of the subsidiaries, AS LHV Pank earned a total of 140.5 million euros in net profit in 2024, UK Bank Limited 5.8 million euros, AS LHV Varahaldus 1.6 million euros, and AS LHV Kindlustus 1.2 million euros.

By the end of 2024, the consolidated assets of LHV Group increased to 8.74 billion euros, growing by 23% year-on-year, i.e., 1.64 billion euros. In Q4, the volume of assets increased by 12%.

The consolidated loan portfolio of LHV increased by 990 million euros to 4.55 billion euros (+28%) in 2024. In Q4, the loan portfolio increased by 10%, i.e., 426 million euros. Corporate loans increased by 328 million euros over the quarter and retail loans by 98 million euros.

The Group’s consolidated deposits grew by 1.18 billion euros over the year to 6.91 billion euros (+21%). In Q4, deposits increased by 624 million euros, i.e., 10%, while deposits of regular clients increased by 134 million euros.

The total volume of funds managed by LHV increased by 39 million euros to 1.56 billion euros (+3%) over the year. In the last quarter of the year, the volume of funds increased by 37 million euros (+2%).

The number of processed payments related to clients that were financial intermediaries amounted to 74.8 million payments in 2024 (+51% compared to 49.5 million payments in 2023). In Q4, 19.8 million such payments were made, i.e., 6% more than in Q3.

In Q4 of 2024, AS LHV Group’s consolidated net profit amounted to 36.3 million euros, which is 1.6 million euros more than in Q3 (+5%). On a year-on-year basis, quarterly profit increased by 11%. AS LHV Pank earned 34.8 million euros in net profit in Q4. In the last quarter of the year, LHV Bank Ltd earned a net profit of 640 thousand euros, AS LHV Varahaldus 509 thousand euros, and AS LHV Kindlustus 68 thousand euros. The return on equity attributable to the shareholders of the Group was 22% in Q4.

The Group’s consolidated net income increased by 2% in Q4 compared to the previous quarter of the year to 84.9 million euros. Net income was 1% higher than last year. Net interest income was generated at 66.6 million euros, and net fee and commission income at 17.3 million euros. Consolidated operating expenses were 40.8 million euros in Q4, which is 14% higher than in Q3 and 13% higher than a year earlier.

Income statement, EUR thousand	Q4-2024	Q3-2024	Q4-2023
Net interest income	66 556	67 426	67 670
Net fee and commission income	17 324	14 630	14 264
Net gains from financial assets	-198	799	480
Other income	1 190	354	1 243
Result from insurance activities	49	357	371
Total revenue	84 921	83 566	84 029
Staff costs	-22 831	-19 499	-17 765
Office rent and expenses	-715	-801	-872
IT expenses	-4 270	-3 612	-4 067
Marketing expenses	-2 086	-1 298	-1 117
Other operating expenses	-10 885	-10 702	-12 366
Total operating expenses	-40 786	-35 911	-36 187
EBIT	44 136	47 655	47 841
Earnings before impairment losses	44 136	47 655	47 841
Impairment losses on loans and advances	-1 085	-7 277	-9 430
Income tax	-6 733	-5 681	-5 643
Net profit	36 318	34 698	32 768
Profit attributable to non-controlling interest	566	312	231
Profit attributable to share holders of the parent	35 752	34 386	32 537

Profit attributable to non-controlling interest	0.11	0.11	0.10
Profit attributable to share holders of the parent	0.11	0.10	0.10

Balance sheet, EUR thousand	Dec 2024	Sep 2024	Dec 2023
Cash and cash equivalents	3 818 305	3 376 016	3 119 394
Financial assets	309 804	259 933	340 341
Loans granted	4 591 906	4 168 778	3 591 517
Loan impairments	-39 813	-42 543	-29 725
Receivables from customers	5 367	10 598	49 505
Other assets	50 742	47 567	54 559
Total assets	8 736 311	7 820 348	7 125 590
Demand deposits	4 855 101	4 160 516	3 808 162
Term deposits	2 055 009	2 125 844	1 922 843
Loans received	927 686	679 550	563 634
Loans received and deposits from customers	7 837 795	6 965 910	6 294 639
Other liabilities	93 601	108 605	147 934
Subordinated loans	126 257	106 079	126 652
Total liabilities	8 057 653	7 180 595	6 569 225
Equity	678 657	639 754	556 365
Minority interest	8 571	8 006	7 937
Total liabilities and equity	8 736 311	7 820 348	7 125 590

LHV Group continued its rapid growth in 2024. The strong end to the year was influenced by a good level of client activity and higher than previous fee and commission income. The decline in interest income was mitigated by strong growth in the loan portfolio. Thanks to the good quality of the portfolio and the improvement in the macroeconomic situation, LHV reduced write-downs. The updated financial plan was accurately fulfilled by the end of the year.

The number of clients of LHV Pank increased by 10,900 to 455 thousand clients in Q4. Over the year, the number of the bank’s clients increased by 38,000, i.e., more than 9%. At the end of the year, clients also actively used LHV’s banking services, and the decrease in interest income was offset by better fee and commission income, especially from investment banking. As interest income continues to be under pressure, the bank is paying attention to limiting costs by increasing efficiency. In this regard, LHV Pank announced layoffs in December, reducing the workforce by 44 people.

The loan issue intensified in the last months of the year and, in Q4, the loan portfolio of LHV Pank increased by 300 million euros. The quality of the loan portfolio has remained stronger than planned, and write-downs on loans were reduced. The deposits of LHV Pank increased by 577 million euros in the last quarter of the year, of which 180 million euros came from deposits of regular clients and 450 million euros from financial intermediaries, and platform deposits were reduced. The bank is still keeping the focus on growing deposits. At the beginning of October, the bank also issued 250 million euros worth of covered bonds.

At the beginning of December, The Banker magazine of the Financial Times declared LHV the best bank of the year in Estonia. Furthermore, Q4 included a review of several important cooperation projects: LHV will be the main sponsor of both Estonian football and the biathlon in the coming years.

The loan portfolio of LHV Bank operating in the United Kingdom grew by more than half for the second quarter in a row. The loan portfolio increased by 126 million euros, while another 119 million euros of loans have been approved but not issued by the Credit Committee. The quality of the loan portfolio is generally strong. The volume of the deposits of LHV Bank increased by 70 million euros, with a total of nearly 11,600 depositors being involved. The volume of payments by financial intermediaries rose to record levels at the end of the year.

In December, LHV Bank opened a new mobile bank for its first clients, through which private persons can open an account and make payments. Further, the offer and app will continue to be improved, and their wider introduction to the market will be held in order to attract deposits directly from retail clients.

By the end of the year, the number of active clients of LHV Varahaldus making monthly contributions was 114,000. Nearly 14,000 of them submitted applications for larger contributions to the II pillar. Seasonally, contributions to the III pillar were actively made again. Operating income and expenses for the quarter remained at the level of the previous quarter. The profit was affected by a more modest financial income from the growth of the funds’ own units than before, but the financial plan still managed to be outpaced.

The stock markets had a strong quarter driven by tech stocks and the U.S. market. The quarterly rate of return of the pension funds M and L managed by LHV was 1.0% and 0.6%, respectively, while XL decreased by 1.4% against the background of a weak December. The rate of return of the more conservative funds XS and S is 0.8% and 1.2%, respectively. Pensionifond Indeks increased by 4.2%; Pensionifond Roheline lost 5.7% in value over the quarter.

For LHV Kindlustus, strong sales results, but also seasonally increased loss events, set the tone at the end of the year. The number of policies in force and clients is in a stable growth trend. A good sales result was shown by most types of insurance. Revenue from the insurance service continued to grow, while operating expenses increased. Gross losses increased a little faster compared to earned income. For the year as a whole, LHV Kindlustus earned 1.2 million from net profit and, thus, outperformed the financial plan.

LHV Group’s annual cost/income ratio turned out to be 43.4%, and return on equity 24.5%. The Group’s liquidity and capitalisation remain strong. In November, LHV Group conducted a successful offering of subordinated bonds, raising 20 million euros in capital from investors. LHV Group will publish the 2025 financial plan and five-year forecast on 13 February.

Comment by Madis Toomsalu, Chairman of the Management Board at LHV Group:
“The changes taking place in the world are probably the biggest in the last half century. We are witnessing the growth of geopolitical ambitions, structural changes in the economy, the decline of free trade, and the exponential growth of technological development.

Despite the different directions, 2024 was a successful year for LHV. After the supervisory exchange, we were able to restore the historically ambitious growth in business volumes. With a strong growth of 1 billion euros, i.e., 28% of the loan portfolio and a higher base interest rate, we achieved the highest business volumes and financial results in history.

In Estonia, we have grown into the second largest bank in terms of corporate loans. At the same time, the volume of home loans and the insurance business are also growing rapidly. The number of the Estonian bank’s clients increased by 38,000 and activity increased in all the important areas. In the United Kingdom, the corporate loan portfolio already exceeded 300 million euros by the end of the year, which is why we are increasing our long-term expectations. This is also reflected in the mobile app launched at the end of the year.”

To access the reports of AS LHV Group, please visit the website at: https://investor.lhv.ee/en/reports/.

In order to present the financial results, LHV Group will organise an investor meeting via the Zoom webinar platform. The virtual investor meeting will take place on 11 February at 9.00, before the market opens. The presentation will be in Estonian. We kindly ask you to register at the following address: https://lhvbank.zoom.us/webinar/register/WN_UP-IqHxNSRSVeoKeUcTOfQ.

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. The Group employs over 1,200 people. As at the end of December, LHV’s banking services are being used by nearly 460,000 clients, the pension funds managed by LHV have 114,000 active clients, and LHV Kindlustus is protecting a total of 170,000 clients. LHV Bank Limited, a subsidiary of the Group, holds a banking licence in the United Kingdom and provides banking services to international financial technology companies, as well as loans to small and medium-sized enterprises.

Priit Rum
Communications Manager
Phone: +372 502 0786
Email: priit.rum@lhv.ee

Attachments

The MIL Network –

February 11, 2025

MIL-OSI China: Announcement on Open Market Operations No.26 [2025]

Source: Peoples Bank of China

Announcement on Open Market Operations No.26 [2025]

(Open Market Operations Office, February 11, 2025)

In order to keep liquidity adequate in the banking system, the People’s Bank of China conducted reverse repo operations in the amount of RMB33 billion through quantity bidding at a fixed interest rate on February 11, 2025.

Details of the Reverse Repo Operations

Maturity

Volume

Rate

7 days

RMB33 billion

1.50%

Date of last update Nov. 29 2018

2025年02月11日

MIL OSI China News –

February 11, 2025
MIL-Evening Report: Australia improves on global corruption rankings, but there is still work to be done

Source: The Conversation (Au and NZ) – By A J Brown, Professor of Public Policy & Law, Centre for Governance & Public Policy, Griffith University

Australia has turned the corner on its decade-long slide on Transparency International’s annual Corruption Perceptions Index (CPI), once again ranking in the top ten least corrupt countries in the world. The fresh ranking comes just ahead of a federal election, which will determine the future of many key anti-corruption reforms.

In the latest 2024 index, Australia rose two points to a score of 77 on the 100-point scale. The index is the world’s most widely cited indicator of how countries are faring in controlling corruption in government.

The result confirms a positive trend, placing Australia back in the top 10 countries for the first time since 2016. It now sits at equal 10th alongside Iceland and Ireland.

In 2012, Australia was ranked as the 7th least corrupt country in the world, with a score of 85 out of 100. But by 2021 it had fallen to a score of 73 and 18th place on the index.

With that fall widely attributed to a decade of complacency and foot-dragging on efforts to bolster integrity in government, the confirmed recovery is a major affirmation of reforms of the past three years. It also highlights some stark choices for policymakers heading into the 2025 federal election.

The best – and worst – places for corruption

Globally, Denmark again tops the index with a score of 90, followed by Finland on 88. The most corrupt countries in the world are Venezuela (10), Somalia (9) and South Sudan (8).

However, the global outlook is highly challenging. Over the past ten years, many more countries have now declined significantly in their anti-corruption scores (47 countries) than have improved on the index (32 countries).

Australia’s recovery is therefore now bucking a negative trend, including the “integrity complacency” still affecting many other developed countries. The United Kingdom (71/100) and United States (65/100) have now fallen to their own lowest-ever scores on the index.

The index is compiled from 13 independent surveys of professional and expert perceptions of public sector corruption across the world. Nine sources were used to inform Australia’s result – including include Freedom House, the World Justice Project and the World Bank’s Executive Opinion Survey.

Two sources had Australia still declining, including the global academic-led Varieties of Democracy (V-Dem) Project. However, six sources rate Australia as improving, led by the Economist Intelligence Unit’s assessment, conducted most recently in September 2024.

Australian reforms are making a difference

There’s now little doubt that the federal integrity reforms of the past three years are a major reason for Australia’s new direction of travel. These include the creation of the National Anti-Corruption Commission in 2022, as well as the long overdue strengthening of Australia’s foreign bribery laws in 2024. A renewed commitment to the global Open Government Partnership, much of the response to Robodebt, and measures to strengthen merit in public appointments, such as replacement of the Administrative Appeals Tribunal, have also helped.

Long overdue anti-money laundering laws were also introduced late in 2024, beyond the time frame for data collection for the latest index. While the impact of these on expert opinion will be known in the future, they highlight that much of the business of Australia’s anti-corruption “catch up” is unfinished and ongoing.

The result poses a challenge for any policymakers suffering under the illusion that Australia’s integrity systems are somehow “fixed”.

From an international perspective, Australia is yet to move to control secret and sham company ownerships – the major vehicle used to hide bribes and stolen public money. This is despite championing transparency in the beneficial ownership of companies since hosting the G20 in 2014.

The need to bring transparency and integrity to federal political donation and funding laws continues to overshadow the last weeks of the 47th parliament. Negotiations between the major parties have failed to inspire confidence among independents, and much of the public.

Effective control of undue influence in decision-making, pork-barrelling, professional lobbying and “revolving door” jobs for politicians and public servants are ongoing challenges.

And in a clear signal to both the Labor government and the Coalition, a team of cross-benchers, led by independent Andrew Wilkie, have introduced a bill to establish a Whistleblower Protection Authority. This remains the single biggest gap in Australia’s integrity system and the most major anti-corruption reform still needed.

Even before Australia hit its 2022 low, some leaders were softening citizens up to accept a reduced position on the index. In 2018, Coalition Attorney-General Christian Porter claimed Australia had remained “consistently in the top 20 countries on Earth for low corruption”. This prompted independent Rebekha Sharkie to point out that Australia had fallen from the top ten: “the trajectory is not good”.

By contrast, Labor leader Anthony Albanese went into the last election accusing the Morrison government of dragging Australia down on corruption, and promising Labor would do better. He said:

The health of our democracy, the integrity of our institutions, the transparency and fairness of our laws, the harmony and cohesion of our population. These aren’t just noble ideals. They are a powerful defence against the threat of modern authoritarianism.

Amid the challenges, there is hope. The federal parliament’s reform record of the past three years is clearly a big step in the right direction.

However, the climb back to 77 on the Corruption Perceptions Index shows it’s clearly just the first step in securing Australia’s reputation as a democracy that protects itself against undue influence and abuse of power.

A J Brown AM is Chair of Transparency International Australia. He has received funding from the Australian Research Council and all Australian governments for research on public interest whistleblowing, integrity and anti-corruption reform through partners including Australia’s federal and state Ombudsmen and other regulatory agencies, parliaments, anti-corruption agencies and private sector bodies. He was a member of the Commonwealth Ministerial Expert Panel on Whistleblowing (2017-2019) and is a member of the Queensland Public Sector Governance Council.

– ref. Australia improves on global corruption rankings, but there is still work to be done – https://theconversation.com/australia-improves-on-global-corruption-rankings-but-there-is-still-work-to-be-done-249458

MIL OSI Analysis – EveningReport.nz –

February 11, 2025

MIL-OSI Economics: Result of the Daily Variable Rate Repo (VRR) auction held on February 11, 2025

Source: Reserve Bank of India

Tenor	1-day
Notified Amount (in ₹ crore)	2,00,000
Total amount of bids received (in ₹ crore)	2,03,022
Amount allotted (in ₹ crore)	2,00,036
Cut off Rate (%)	6.26
Weighted Average Rate (%)	6.27
Partial Allotment Percentage of bids received at cut off rate (%)	97.01

Ajit Prasad
Deputy General Manager
(Communications)

Press Release: 2024-2025/2126

MIL OSI Economics –

February 11, 2025

MIL-OSI Economics: The Office of Markets Development and Public–Private Partnership

Source: Asia Development Bank

It outlines how OMDP helps developing member countries (DMCs) access the tools they need to engage businesses. It shows how it helps DMCs create conducive environments for investors and build up their private sectors. Highlighting the $4.3 billion in private capital OMDP mobilized since 2016, it shows why working with businesses to develop infrastructure helps DMCs harness cutting-edge technologies, boost project efficiency, and achieve transformative growth. 

MIL OSI Economics –

February 11, 2025
MIL-OSI Submissions: Australia – CBA extends commitment to regional branch network until 31 July 2027

Source: Commonwealth Bank of Australia

CBA has extended its commitment to regional Australia, with all regional branches to remain open until at least 31 July 2027.

Our focus is on supporting our customers in regional and remote communities into the future.

We’re actively and directly communicating with community leaders across Australia so we can serve and support our regional retail and business customers with their banking needs, as well as help familiarise communities with the full range of banking services available to them.

As part of maintaining Australia’s largest banking presence, CBA will this year invest $100 million in upgrading its branches and ATM fleet.

The extension of the commitment announced in July 2023 ensures CBA continues to offer the largest branch network in Australia and offers reassurance to regional communities.

Notes to Editor

Branch locations are defined in line with the Accessibility/Remoteness Index of Australia (ARIA+), which is recognised as a leading indicator of remoteness in Australia. ARIA+ is used by the Australian Bureau of Statistics (ABS) for its Australian Statistical Geography Standard (ASGS) Edition 3, and the Australian Prudential Regulation Authority (APRA) for its annual ADI Points of Presence report. ARIA+ is an objective measure of physical distance of populations to services.

MIL OSI – Submitted News –

February 11, 2025

MIL-OSI Economics: Money Market Operations as on February 10, 2025

Source: Reserve Bank of India


(Amount in ₹ crore, Rate in Per cent)

	Volume (One Leg)	Weighted Average Rate	Range
A. Overnight Segment (I+II+III+IV)	5,66,515.61	6.28	5.00-6.75
I. Call Money	12,879.97	6.32	5.15-6.45
II. Triparty Repo	3,80,693.90	6.25	5.95-6.35
III. Market Repo	1,71,142.14	6.35	5.00-6.60
IV. Repo in Corporate Bond	1,799.60	6.53	6.40-6.75
B. Term Segment
I. Notice Money**	1,280.50	5.92	5.90-6.35
II. Term Money^@@	597.50	–	6.35-6.60
III. Triparty Repo	724.60	6.34	6.20-6.45
IV. Market Repo	328.11	6.36	6.35-6.40
V. Repo in Corporate Bond	585.00	8.00	8.00-8.00

	Auction Date	Tenor (Days)	Maturity Date	Amount	Current Rate / Cut off Rate
C. Liquidity Adjustment Facility (LAF), Marginal Standing Facility (MSF) & Standing Deposit Facility (SDF)
I. Today’s Operations
1. Fixed Rate
2. Variable Rate^&
(I) Main Operation
(a) Repo
(b) Reverse Repo
(II) Fine Tuning Operations
(a) Repo	Mon, 10/02/2025	1	Tue, 11/02/2025	2,01,310.00	6.26
(b) Reverse Repo
(III) Long Term Operations^
(a) Repo
(b) Reverse Repo
3. MSF^#	Mon, 10/02/2025	1	Tue, 11/02/2025	4,125.00	6.50
4. SDF^Δ#	Mon, 10/02/2025	1	Tue, 11/02/2025	67,439.00	6.00
5. Net liquidity injected from today’s operations [injection (+)/absorption (-)]*				1,37,996.00
II. Outstanding Operations
1. Fixed Rate
2. Variable Rate^&
(I) Main Operation
(a) Repo
(b) Reverse Repo
(II) Fine Tuning Operations
(a) Repo
(b) Reverse Repo
(III) Long Term Operations^
(a) Repo	Fri, 07/02/2025	56	Fri, 04/04/2025	50,010.00	6.31
(b) Reverse Repo
3. MSF^#
4. SDF^Δ#
D. Standing Liquidity Facility (SLF) Availed from RBI^$				8,328.42
E. Net liquidity injected from outstanding operations [injection (+)/absorption (-)]*				58,338.42
F. Net liquidity injected (outstanding including today’s operations) [injection (+)/absorption (-)]*				1,96,334.42
G. Cash Reserves Position of Scheduled Commercial Banks
(i) Cash balances with RBI as on		February 10, 2025		9,13,487.07
(ii) Average daily cash reserve requirement for the fortnight ending		February 21, 2025		9,12,240.00
H. Government of India Surplus Cash Balance Reckoned for Auction as on^¥		February 10, 2025		1,25,736.00
I. Net durable liquidity [surplus (+)/deficit (-)] as on		January 24, 2025		-34,103.00
^@ Based on Reserve Bank of India (RBI) / Clearing Corporation of India Limited (CCIL).
– Not Applicable / No Transaction.
** Relates to uncollateralized transactions of 2 to 14 days tenor.
^@@ Relates to uncollateralized transactions of 15 days to one year tenor.
^$ Includes refinance facilities extended by RBI.
^& As per the Press Release No. 2019-2020/1900 dated February 06, 2020.
^Δ As per the Press Release No. 2022-2023/41 dated April 08, 2022.
* Net liquidity is calculated as Repo+MSF+SLF-Reverse Repo-SDF.
^¥ As per the Press Release No. 2014-2015/1971 dated March 19, 2015.
# As per the Press Release No. 2023-2024/1548 dated December 27, 2023.
^ As per the Press Release No. 2024-2025/2013 dated January 27, 2025.
Ajit Prasad Deputy General Manager (Communications)
Press Release: 2024-2025/2125

MIL OSI Economics –

February 11, 2025

MIL-OSI USA: At CFPB Headquarters, Warren Sounds Alarm on Elon Musk’s Attack against Consumer Financial Protection Bureau

US Senate News:

Source: United States Senator for Massachusetts – Elizabeth Warren

February 10, 2025

“Donald Trump ran his campaign on lowering costs for working families…now he and his co-president, Elon Musk, have tried to shut down the agency that has delivered $21 billion to hardworking families.”

“Congress built [the CFPB], and no one other than Congress — not Donald Trump, not Elon Musk, no one – can fire the financial cops.”

Video of Remarks

Washington, D.C. – U.S. Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs (BHUA), delivered remarks at the headquarters of the Consumer Financial Protection Bureau (CFPB) in defense of the agency. The rally comes in response to billionaire Elon Musk and Project 2025 architect Russ Vought attempting to shut down the CFPB.

Transcript: Rally to Defend the Consumer Financial Protection Bureau
February 10, 2025
As Delivered

Senator Elizabeth Warren: I am so glad to be here with you today. My name is Elizabeth Warren, and I’m here with you to fight for our Consumer Financial Protection Bureau.

The CFPB is the cop on the beat, and that cop is the one that caught the crooks and, so far, has made them give back $21 billion.

That cop is the one that put that $21 billion right back into the hands of the American people who got cheated.

That cop is the one who has worked, day by day, to get your money back when some slimeball decided they could cheat you and there wouldn’t be anything you can do about it.

Now, the CFPB is the little agency that has fought for us, and we’re here today to fight for the CFPB. Let’s give a huge cheer for the CFPB!

Donald Trump ran his campaign on lowering costs for working families. Yeah, now, he and his co-president, Elon Musk, have tried to shut down the agency that has delivered $21 billion to hardworking families. $21 billion to people who got cheated—and Trump and Musk want to just take that agency away.

Donald Trump and Elon Musk have told the financial cops at the CFPB to stand down. Now, think about this – I want you to think about this for a minute – no matter how big the scam, no matter how bold the trap, they have said just stand by and let the Wall Street boys take your money.

Well, we are here to fight back! We want our financial cops back on the beat!

This is a fight – and I want you to watch who this fight is between – this is a fight between millions of hardworking people, who just don’t want to get cheated, and a handful of billionaires like Elon Musk who want the chance to cheat them.

So here’s how we have to think about this: for every person who wants to buy a home without getting scammed, this fight is your fight.

For every family that doesn’t want to get put out on the street in an illegal foreclosure, this is your fight.

For every student who wants to borrow money to go to school without getting defrauded, this is your fight.

For every member of our military who doesn’t want to get trapped by some sleazy payday lender – say it with me: this is your fight.

For every person who borrows money to buy a car and doesn’t want to get trapped in the fine print, this is your fight.

For every American who doesn’t want to see Wall Street crash our economy again, this is your fight.

And for every American who doesn’t want some weird Elon Musk suck-up searching through your personal, private data, this is your fight.

Your fight, my fight, our fight—and we will win this fight!

Because, understand this – this fight is about more than one little agency.

This fight is about more than just our financial rules and regulations.

This fight is about more than just Democrat versus Republican politics.

This fight is about hardworking people versus the billionaires who want to squeeze more and more and more money out of them. And now, now is our time to put a stop to this!

Look, these damn billionaires are making their moves right out in the open. Look at Elon. Please. No, just look. He invested $288 million to buy an election for Donald Trump. And now he is right here to collect on that investment.

Elon Musk owns “X,” which has been losing money like crazy. So Elon has a plan for a new payment platform called “X Money”. Elon wants X Money to touch every part of your financial life.

But Elon has got a problem: the financial cops. The CFPB is there to make sure that Elon’s new project can’t scam you or steal your sensitive personal data. So Elon’s solution? Get rid of the cops. Kill the CFPB.

This is like a bank robber trying to fire the cops and turn off the alarms just before he strolls into the lobby.

We are here to fight back!

So I’ve got to ask: are you ready to stand up to the scammers?

Are you ready to push back against the fraudsters?

Are you ready to say no to Elon Musk?

Look, after the 2008 financial crash and the big bank bailout, Congress created the CFPB to protect people from getting swindled.

Congress built it, and no one other than Congress — not Donald Trump, not Elon Musk, no one can fire the financial cops.

We are fighting back, and understand this: there is power in fighting back. Real power. We, the people, not Elon Musk, we the people have the real power in this country—and we are going to use that power.

So here it is: are you ready to fight for the little agency that fights for us? Are you ready to fight the billionaires who are trying to take over this country? Are you ready to say no to Elon Musk?

We will fight it out in Congress. We will fight it out in the courts. We will fight it out all across this country—and I promise you, we will win.

MIL OSI USA News –

February 11, 2025
MIL-OSI China: China Development Bank issues 1.53 trillion yuan in infrastructure loans

Source: China State Council Information Office 3

China Development Bank issued 1.53 trillion yuan (about 213.37 billion U.S. dollars) in infrastructure loans across the country in 2024, the bank said on Monday.

The loans were granted for major infrastructure areas such as industrial upgrading, urban development and national security, the bank noted.

Last year, China Development Bank strengthened its support for medium and long-term financing, and helped advance the implementation of the 102 key projects listed in the country’s 14th Five-Year Plan (2021-2025).

It also supported projects to implement major national strategies and build security capacities in key areas, as well as the implementation of large-scale equipment upgrades and consumer goods trade-in programs.

The bank has also been actively supporting the construction of information infrastructure, integrated infrastructure and innovation infrastructure, all of which have broad application potential, strong enabling capabilities and significant driving effects.

MIL OSI China News –

February 11, 2025
MIL-OSI USA: Crapo, Risch Introduce Constitutional Amendment to Prevent Supreme Court Packing

US Senate News:

Source: United States Senator for Idaho Mike Crapo
Washington, D.C.–U.S. Senators Mike Crapo and Jim Risch (R-Idaho) joined Senator Ted Cruz (R-Texas) in introducing a constitutional amendment to maintain a total of nine Supreme Court justices on the bench at one time.
Once approved by Congress, the amendment would go to the states for ratification.
“Throughout our nation’s history, the Supreme Court has successfully safeguarded our Constitution,” said Crapo. “Packing the Court would unnecessarily increase partisanship within the institution, creating greater challenges in settling the pressing cases that matter to Americans in a constitutional and just way.”
“Democrats’ attempts to pack the Supreme Court with radical appointees undermines our democracy and American confidence in our judicial system,” said Risch. “The Keep Nine Constitutional Amendment would ensure justices focus on upholding the rule of law rather than legislating from the bench.”
“For years, Democrats have openly said they intend to pack the Supreme Court,” said Cruz. “They seek to use the Court to advance policy goals they can’t accomplish electorally. Such a move would be a direct assault on the design of our Constitution, which is designed to ensure the Supreme Court remains a non-partisan guardian of the rule of law. This amendment is a badly-needed check on their efforts to undermine the integrity of the Court.”
Additional co-sponsors of the proposed constitutional amendment include Senators Chuck Grassley (R-Iowa), John Cornyn (R-Texas), Mike Lee (R-Utah), Shelley Moore Capito (R-West Virginia), Marsha Blackburn (R-Tennessee), Bill Cassidy (R-Louisiana), Todd Young (R-Indiana), Cindy Hyde-Smith (R-Mississippi), Jim Banks (R-Indiana), Thom Tillis (R-North Carolina), Bill Hagerty (R-Tennessee), Katie Britt (R-Alabama), Tim Sheehy (R-Montana), Roger Wicker (R-Mississippi) and Deb Fischer (R-Nebraska).
Read the complete text of the amendment here.
BACKGROUND:
Senators Crapo and Risch previously co-sponsored this amendment in 2023.
Over the past several years, top Democrats have pledged to expand the number of justices on the Supreme Court when they are able to.

MIL OSI USA News –

February 11, 2025
MIL-OSI USA: Armstrong appoints Levi Bachmeier, Patrick Sogard to North Dakota Board of Higher Education

Source: US State of North Dakota

Gov. Kelly Armstrong announced today he has appointed Levi Bachmeier of West Fargo and Patrick Sogard of Williston to four-year terms on the State Board of Higher Education starting July 1.

“Levi and Pat bring valuable experience in education policy, finance and operations to the State Board of Higher Education as our colleges and universities are being challenged by changing demographics and learning models. Our University System is still the best workforce recruiting tool we have, and we need our campuses to align their offerings with workforce needs, adapt to trends and thrive, not just survive,” Armstrong said. “We’re thankful for their willingness to serve and the passion for higher education shared by all the candidates.”

Bachmeier has served as business manager of the West Fargo School District since 2019. From 2016 to 2019 he served as an education policy adviser and policy director for then-North Dakota Gov. Doug Burgum. Bachmeier previously taught high school social studies for two years with Teach for America and spent a summer as a policy analyst fellow at the U.S. Department of Education. A native of West Fargo, Bachmeier earned a bachelor’s degree in education from Concordia College in Moorhead, Minn. He currently serves on the North Dakota Board of Public Education and North Dakota Career and Technical Education Board, in addition to coaching track and field.

Sogard has chaired the board of American State Bank & Trust Co. in Williston since 2003, also serving as a trust officer from 2000 to 2005. He previously worked as an attorney in private practice from 1986 to 2000. A native of Alamo, N.D., Sogard studied at the U.S. Military Academy at West Point and earned his bachelor’s degree in geological engineering from the University of North Dakota in Grand Forks and his law degree from the UND School of Law. He is a past board member of Mercy Medical Center and St. Joseph’s Elementary School, both in Williston, and currently serves on the board of the UND Alumni Association & Foundation.

Both appointments are subject to confirmation by the state Senate. Bachmeier will succeed board member Casey Ryan, a Grand Forks physician who is completing his second term on the board, the maximum allowed by the state Constitution. Sogard will succeed board member Jeffry Volk, a retired Fargo consulting engineer who has served on the board since 2021.

The Board of Higher Education has eight voting members appointed by the governor, including one student member, and two non-voting members who represent the North Dakota University System’s faculty and staff. The board oversees the system’s 11 public colleges and universities.

MIL OSI USA News –

February 11, 2025
MIL-Evening Report: Israeli police cite children’s ‘colouring book’ for Palestinian bookshop raid

Pacific Media Watch

Israeli police have confiscated hundreds of books with Palestinian titles or flags without understanding their contents in a draconian raid on a Palestinian educational bookshop in occupied East Jerusalem, say eyewitnesses.

More details have emerged on the Israeli police raid on a popular bookstore in occupied East Jerusalem.

The owners were arrested but police reportedly dropped charges of incitement while still detaining them for “disturbing the public order”.

The bookstore’s owners, Ahmed and Mahmoud Muna, were detained, and hundreds of titles related to the Palestinian-Israeli conflict confiscated, before police ordered the store’s closure, according to May Muna, Mahmoud’s wife, reports Al Jazeera.

She said the soldiers picked out books with Palestinian titles or flags, “without knowing what any of them meant”.

She said they used Google Translate on some of the Arabic titles to see what they meant before carting them away in plastic bags.

Another police bookshop raid
Police raided another Palestinian-owned bookstore in the Old City in East Jerusalem last week. In a statement, the police said the two owners were arrested on suspicion of “selling books containing incitement and support for terrorism”.

As an example, the police referred to an English-language children’s colouring book titled From the River to the Sea — a reference to the territory between the Jordan River and the Mediterranean Sea that today includes Israel, the occupied West Bank and the Gaza Strip.

The bookshop raids have been widely condemned as a “war on knowledge and literature”.

The Educational Bookshop in East Jerusalem is full with shoppers in solidarity a day after the Israel Police raided the Palestinian store, arrested its owners and confiscated books. They dropped the charges of incitement but still detain them for ‘disturbing the public order’ pic.twitter.com/ZfnkBttfY3

— David Issacharoff (@davidiss) February 10, 2025

MIL OSI Analysis – EveningReport.nz –

February 11, 2025
MIL-OSI Global: As Trump abandons the old world order, NZ must find its place in a new ‘Pax Autocratica’

Source: The Conversation – Global Perspectives – By Chris Ogden, Associate Professor in Global Studies, University of Auckland, Waipapa Taumata Rau

Donald Trump is moving rapidly to change the contours of contemporary international affairs, with the old US-dominated world order breaking down into a multipolar one with many centres of power.

The shift already includes the US leaving the World Health Organization and the Paris Climate Accords, questioning the value of the United Nations, and radical cuts to the US Agency for International Development (USAID).

Such a new geopolitical age also involves an assertion of raw power, with Trump using the threat of tariffs to assert global authority and negotiating positions.

While the US is not significantly less powerful, this new era may see it wield that power in more openly self-interested and isolationist ways. As new US Secretary of State Marco Rubio put it in January, “the post-war global order is not just obsolete – it is now a weapon being used against us”.

With global democracy in retreat, the emerging international order looks to be moving in an authoritarian direction. As it does, the position of New Zealand’s vibrant democracy will come under mounting pressure.

But world orders have come and gone for millennia, reflecting the ebb and flow of global economic, political and military power. Looking back to previous eras, and how countries and cultures responded to shifting geopolitical realities, can help us understand what is happening more clearly.

An evolving world order

Previous orders have often focused on specific centres – or “poles” – of power. These include the Concert of Europe from 1814 to 1914, the bipolar world of the Cold War between the US and the Soviet Union, and the unipolar world of American dominance after the end of the Cold War and since the September 11 attacks in 2001.

Periods of single-power dominance (or hegemony) are referred to as a “pax”, from the Latin for “peace”. We have seen the Pax Romana of the Roman Empire (27 BCE to 180 AD), multiple Pax Sinicas around China (most recently the Qing Dynasty 1644 to 1912), Pax Mongolica (the Mongol Empire from 1271 to 1368) and Pax Britannica (the British Empire from 1815 to 1924).

It is the Pax Americana of the US, from 1945 to the present, that Trump seems bent on dismantling. We now live in an international order that is visibly in flux. With autocracy on the rise and the US at its vanguard, a “Pax Autocratica” is emerging.

This is accentuated by the rapid rise of Asia as the main sphere of economic and military growth, particularly China and India. The world’s two most populous countries had the world’s largest and third largest economies respectively in 2023, and the second and fourth highest levels of military spending.

The simultaneous rise of multiple power centres was already challenging the Pax Americana. Now, a new international order appears to be a certainty, with Trump openly adapting to multipolarity. Several major powers now compete for global influence, rather than any one country dominating.

China’s preference for a multipolar international order is shared by India and Russia. Without one dominant entity, it will be the political and social basis of this order, as determined by its major actors, that matters most – not who leads it.

Pax Democratica

The current (now waning) international order has been underpinned by specific social, political and economic values stemming from the national identity and historical experience of the US.

According to US political expert G. John Ikenberry, former president Woodrow Wilson’s agenda for peace after the first world war sought to “reflect distinctive American ideas and ideals”.

Woodrow imagined an order based on collective security and shared sovereignty, liberal principles of democracy and universal human rights, free trade and international law.

As its dominance and military strength increased in the 20th century, the US also provided security to other countries. Such power enabled Washington to create open global trade markets, as well as build core global institutions like the World Bank, International Monetary Fund, World Trade Organization, United Nations and NATO.

For Ikenberry, this Pax Americana (we might call it a Pax Democratica) rested on consent to the US’s “provision of security, wealth creation, and social advancement”. This was aided by the its more than 800 military bases in over 80 countries.

The democratic deficit

Trump undercuts the central tenets of this liberal world order and accelerates a slide towards authoritarianism. Like Russia, India and China, the US is also actively constraining human rights, attacking minorities and weakening its electoral system.

This democratic retreat leaves a country such as New Zealand in a global minority. If Trump targets the region or country with economic tariffs, that precariousness might increase.

On the other hand, previous world orders have not been truly hegemonic. Pax Britannica did not encompass the entire world. Nor did Pax Americana, which didn’t include China, India, the former Soviet bloc, much of the Islamic world and many developing countries.

This suggests pockets of democracy can survive within a Pax Autocratica, especially in a multipolar world which is more tolerant of political independence.

The Economist Intelligence Unit’s 2023 Democracy Index ranked New Zealand, the Nordic countries, Switzerland, Iceland and Ireland highest because their citizens

choose their political leaders in free and fair elections, enjoy civil liberties, prefer democracy over other political systems, can and do participate in politics, and have a functioning government that acts on their behalf.

It is these countries that can be at the vanguard of democratic resilience.

Chris Ogden is a Senior Research Fellow with The Foreign Policy Centre, London.

– ref. As Trump abandons the old world order, NZ must find its place in a new ‘Pax Autocratica’ – https://theconversation.com/as-trump-abandons-the-old-world-order-nz-must-find-its-place-in-a-new-pax-autocratica-249358

MIL OSI – Global Reports –

February 11, 2025

MIL-OSI: F&M Bank Welcomes Peter Schork as Regional President for Toledo, Ohio & Southeast Michigan

Source: GlobeNewswire (MIL-OSI)

ARCHBOLD, Ohio, Feb. 10, 2025 (GLOBE NEWSWIRE) — F&M Bank (“F&M”), an Archbold, Ohio-based bank owned by Farmers & Merchants Bancorp, Inc. (Nasdaq: FMAO) announced that Peter Schork has joined F&M as Regional President of the Toledo, Ohio, and Southeastern Michigan regions.

Lars Eller, President and CEO of F&M stated, “As a proven community banker, Peter brings a wealth of experience to F&M. His leadership, deep market knowledge, and commitment to building strong relationships will be an invaluable resource to F&M as we continue to grow and serve our communities. We look forward to the impact he will make in driving success for our customers, employees, and stakeholders.”

In his new role, Peter will oversee F&M’s presence in the Toledo, Ohio, and Birmingham, Michigan markets, including offices in Waterville, Swanton, Perrysburg, Sylvania, and Downtown Toledo, as well as F&M’s Loan Production Office in Troy and its Birmingham, Michigan location.

Peter brings over 25 years of banking and financial experience to F&M. Prior to joining the Company, he served as the Ann Arbor President for Oxford Bank and co-founded the Ann Arbor State Bank serving as its President and CEO. In addition to his community bank experience, Peter was the CFO at Catalyst Commercial Real Estate, and the President of a Michigan-based title, mortgage, and real estate company. In addition to his business experience, Peter is a proud supporter of various community organizations. Currently, he serves on the Michigan Theater Board of Trustees, is a member of the Ray and Eleanor Cross Foundation and the Kiwanis Club of Ann Arbor and is a Board Member and Treasurer for the Homeless/Unhoused Mission. Peter holds a Master of Business Administration (M.B.A.) with a specialization in Finance from Eastern Michigan University.

About F&M Bank:
F&M Bank is a local independent community bank that has been serving its communities since 1897. F&M Bank provides commercial banking, retail banking and other financial services. Our locations are in Butler, Champaign, Fulton, Defiance, Hancock, Henry, Lucas, Shelby, Williams, and Wood counties in Ohio. In Northeast Indiana, we have offices located in Adams, Allen, DeKalb, Jay, Steuben and Wells counties. The Michigan footprint includes Oakland County, and we have Loan Production Offices in Troy, Michigan; Muncie, Indiana; and Perrysburg and Bryan, Ohio.

Safe harbor statement
Private Securities Litigation Reform Act of 1995. Statements by F&M, including management’s expectations and comments, may not be based on historical facts and are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21B of the Securities Exchange Act of 1934, as amended. Actual results could vary materially depending on risks and uncertainties inherent in general and local banking conditions, competitive factors specific to markets in which F&M and its subsidiaries operate, future interest rate levels, legislative and regulatory decisions, capital market conditions, or the effects of the COVID-19 pandemic, and its impacts on our credit quality and business operations, as well as its impact on general economic and financial market conditions. F&M assumes no responsibility to update this information. For more details, please refer to F&M’s SEC filing, including its most recent Annual Report on Form 10-K and quarterly reports on Form 10-Q. Such filings can be viewed at the SEC’s website, www.sec.gov or through F&M’s website www.fm.bank.

__________________________________________

Company Contact:	Investor and Media Contact:
Lars B. Eller President and Chief Executive Officer Farmers & Merchants Bancorp, Inc. (419) 446-2501 leller@fm.bank	Andrew M. Berger Managing Director SM Berger & Company, Inc. (216) 464-6400 andrew@smberger.com

A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/e11179be-cf20-449e-9416-ca1e8ff1fd2f

The MIL Network –

February 11, 2025

MIL-OSI USA: Senator Reverend Warnock Issues Statement on CFBP Shutting Down Following Orders from Trump Administration

US Senate News:

Source: United States Senator Reverend Raphael Warnock – Georgia

Senator Reverend Warnock Issues Statement on CFBP Shutting Down Following Orders from Trump Administration

Last Congress, Senator Reverend Warnock chaired the Subcommittee on Financial Institutions and Consumer Protection, which oversaw the Consumer Financial Protection Bureau (CFPB)

Senator Reverend Warnock successfully pushed CFPB to remove medical debt from credit scores, impact 12% of Georgians with medical debt

In partnership with Senator Reverend Warnock, CFPB addressed 266,560 complaints from Georgians, including 20,168 from servicemembers in the state

Senator Reverend Warnock: “Georgians I speak to every day don’t have the financial flexibility of the world’s richest man, many of them only have a few hundred dollars in their bank account. Those are the Georgians who will suffer from CFPB’s closure”

Washington, D.C. – Today, U.S. Senator Reverend Raphael Warnock (D-GA), former chair of the Senate Banking Subcommittee on Financial Institutions and Consumer Protection, issued the following statement on the closure of the Consumer Financial Protection Bureau (CFPB):

“The Trump Administration is trying to squeeze the voices of the people out of our democracy so those in power can create more wealth for people like themselves. The Consumer Financial Protection Bureau is their latest target.”

“This reckless action will hurt millions of Georgians and Americans across the country. The CFPB has been an eager partner in our work to protect working-class Americans from fraud, scams, and predatory companies. Fighting on behalf of consumers from mortgages and student loans to medical debt and junk fees, CFPB has returned billions to the public.”

“Georgians I speak to every day don’t have the financial flexibility of the world’s richest man, many of them only have a few hundred dollars in their bank account. Those are the Georgians who will suffer from the CFPB’s closure. I will remain laser-focused on doing everything I can to protect the financial security of Georgians and committed to making sure the protections secured by CFPB aren’t rolled back.”

Last Congress, Senator Warnock worked extensively with CFPB Chair, Rohit Chopra, to return funds and protect Georgians from future financial hardship, including:

MIL OSI USA News –

February 11, 2025
MIL-OSI USA: Senator Reverend Warnock, Colleagues Push Back on DOGE’s Interference into Departments of Education, Treasury and Access to Payments Systems for Millions of Americans

US Senate News:

Source: United States Senator Reverend Raphael Warnock – Georgia

Senator Reverend Warnock, Colleagues Push Back on DOGE’s Interference into Departments of Education, Treasury and Access to Payments Systems for Millions of Americans

In two separate efforts this week, Senator Reverend Warnock demanded answers into the “Department” of Government Efficiency (DOGE) employees’ data collection practices and access to federal agencies

The letters are part of an ongoing effort by several lawmakers to push back against the efforts of the Trump Administration and its billionaire allies to gut the federal government

The letters follow Senator Reverend Warnock’s nearly hour-long speech on the Senate floor opposing Russell Vought’s nomination to lead the Office of Management and Budget (OMB)

ICYMI from the New York Times: Senate Democrats Demand Clarity About Musk’s Efforts at Education Dept.

Washington, D.C. — Earlier this week, U.S. Senator Reverend Raphael Warnock (D-GA) joined two efforts to push back against the “Department” of Government Efficiency’s (DOGE) access to personal information and sensitive government data.

“If you want to know who Donald Trump is working for, look at who he’s surrounding himself with. The likes of Elon Musk, the billionaire, the richest man in the world who is now telling the rest of us that we need to tighten our belts. How quaint,” said Senator Reverend Warnock during his Wednesday floor speech.

The first letter, authored by Senator Elizabeth Warren (D-MA) and Senate Minority Leader Chuck Schumer (D-NY), was sent to Acting Secretary of the Department of Education (ED), Denise Carter, launching a probe into recent reports that Elon Musk’s Department of Government Efficiency (DOGE) has infiltrated the Department of Education and that “DOGE staffers have gained access to federal student loan data, which includes personal information for millions of borrowers.”

“This deeply troubling report raises questions about potential exposures of Americans’ private data, the abuse of this data by the Trump Administration, and whether officials who have access to the data may have violated the law or the federal government’s procedures for handling sensitive information,” wrote the senators.

In the second letter, addressed to Senate Banking and Finance committee Chairs, Tim Scott (R-SC) and Mike Crapo (R-ID) respectively, Senator Warnock joined 16 other Senate Democrats in calling for an immediate hearing to examine the reports that officials associated with the DOGE have gained access to systems that control millions of payments to American citizens.

“Putting this system in the hands of unaccountable political actors raises significant economic and national security risks. Information in these systems is critical to the Department’s management of the national debt. The takeover by Mr. Musk and his associates was achieved by engineering the ouster of a key official responsible for managing the extraordinary measures the Department has been taking to avoid a default. A misstep with these payment systems could lead to a technical default with a wide range of devastating consequences, from seniors missing Social Security payments to a global financial meltdown that costs trillions of dollars and millions of jobs,” wrote the Senators.

The letter to acting DOE Secretary Denise Carter can be viewed HERE.

The letter to Ranking Members Scott and Crapo can be viewed HERE.

MIL OSI USA News –

February 11, 2025
MIL-Evening Report: As Trump abandons the old world order, NZ must find its place in a new ‘Pax Autocratica’

Source: The Conversation (Au and NZ) – By Chris Ogden, Associate Professor in Global Studies, University of Auckland, Waipapa Taumata Rau

Donald Trump is moving rapidly to change the contours of contemporary international affairs, with the old US-dominated world order breaking down into a multipolar one with many centres of power.

The shift already includes the US leaving the World Health Organization and the Paris Climate Accords, questioning the value of the United Nations, and radical cuts to the US Agency for International Development (USAID).

Such a new geopolitical age also involves an assertion of raw power, with Trump using the threat of tariffs to assert global authority and negotiating positions.

While the US is not significantly less powerful, this new era may see it wield that power in more openly self-interested and isolationist ways. As new US Secretary of State Marco Rubio put it in January, “the post-war global order is not just obsolete – it is now a weapon being used against us”.

With global democracy in retreat, the emerging international order looks to be moving in an authoritarian direction. As it does, the position of New Zealand’s vibrant democracy will come under mounting pressure.

But world orders have come and gone for millennia, reflecting the ebb and flow of global economic, political and military power. Looking back to previous eras, and how countries and cultures responded to shifting geopolitical realities, can help us understand what is happening more clearly.

An evolving world order

Previous orders have often focused on specific centres – or “poles” – of power. These include the Concert of Europe from 1814 to 1914, the bipolar world of the Cold War between the US and the Soviet Union, and the unipolar world of American dominance after the end of the Cold War and since the September 11 attacks in 2001.

Periods of single-power dominance (or hegemony) are referred to as a “pax”, from the Latin for “peace”. We have seen the Pax Romana of the Roman Empire (27 BCE to 180 AD), multiple Pax Sinicas around China (most recently the Qing Dynasty 1644 to 1912), Pax Mongolica (the Mongol Empire from 1271 to 1368) and Pax Britannica (the British Empire from 1815 to 1924).

It is the Pax Americana of the US, from 1945 to the present, that Trump seems bent on dismantling. We now live in an international order that is visibly in flux. With autocracy on the rise and the US at is vanguard, a “Pax Autocratica” is emerging.

This is accentuated by the rapid rise of Asia as the main sphere of economic and military growth, particularly China and India. The world’s two most populous countries had the world’s largest and third largest economies respectively in 2023, and the second and fourth highest levels of military spending.

The simultaneous rise of multiple power centres was already challenging the Pax Americana. Now, a new international order appears to be a certainty, with Trump openly adapting to multipolarity. Several major powers now compete for global influence, rather than any one country dominating.

China’s preference for a multipolar international order is shared by India and Russia. Without one dominant entity, it will be the political and social basis of this order, as determined by its major actors, that matters most – not who leads it.

Pax Democratica

The current (now waning) international order has been underpinned by specific social, political and economic values stemming from the national identity and historical experience of the US.

According to US political expert G. John Ikenberry, former president Woodrow Wilson’s agenda for peace after the first world war sought to “reflect distinctive American ideas and ideals”.

Woodrow imagined an order based on collective security and shared sovereignty, liberal principles of democracy and universal human rights, free trade and international law.

As its dominance and military strength increased in the 20th century, the US also provided security to other countries. Such power enabled Washington to create open global trade markets, as well as build core global institutions like the World Bank, International Monetary Fund, World Trade Organization, United Nations and NATO.

For Ikenberry, this Pax Americana (we might call it a Pax Democratica) rested on consent to the US’s “provision of security, wealth creation, and social advancement”. This was aided by the its more than 800 military bases in over 80 countries.

The democratic deficit

Trump undercuts the central tenets of this liberal world order and accelerates a slide towards authoritarianism. Like Russia, India and China, the US is also actively constraining human rights, attacking minorities and weakening its electoral system.

This democratic retreat leaves a country such as New Zealand in a global minority. If Trump targets the region or country with economic tariffs, that precariousness might increase.

On the other hand, previous world orders have not been truly hegemonic. Pax Britannica did not encompass the entire world. Nor did Pax Americana, which didn’t include China, India, the former Soviet bloc, much of the Islamic world and many developing countries.

This suggests pockets of democracy can survive within a Pax Autocratica, especially in a multipolar world which is more tolerant of political independence.

The Economist Intelligence Unit’s 2023 Democracy Index ranked New Zealand, the Nordic countries, Switzerland, Iceland and Ireland highest because their citizens

choose their political leaders in free and fair elections, enjoy civil liberties, prefer democracy over other political systems, can and do participate in politics, and have a functioning government that acts on their behalf.

It is these countries that can be at the vanguard of democratic resilience.

Chris Ogden is a Senior Research Fellow with The Foreign Policy Centre, London.

– ref. As Trump abandons the old world order, NZ must find its place in a new ‘Pax Autocratica’ – https://theconversation.com/as-trump-abandons-the-old-world-order-nz-must-find-its-place-in-a-new-pax-autocratica-249358

MIL OSI Analysis – EveningReport.nz –

February 11, 2025

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