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  • MIL-OSI Economics: Transcript of Fiscal Monitor October 2024 Press Briefing

    Source: International Monetary Fund

    October 23, 2024

    SPEAKERS:
     Vitor Gaspar, Director, Fiscal Affairs Department
    Era Dabla‑Norris, Deputy Director, Fiscal Affairs Department
    Davide Furceri, Division Chief, Fiscal Affairs Department
    Tatiana Mossot, Moderator, Senior Communications Officer

    The Moderator (Ms. Mossot): Good morning, good afternoon, and good evening to our viewers around the world. I am Tatiana Mossot, the IMF Communications Department, and I will be your host for today’s press briefing on the Annual Meetings 2024 Fiscal Monitor, “Putting a Lead on Public Debt.” I am pleased to introduce this morning the Director of the Fiscal Affairs Department, Vitor Gaspar. He is joined by Era Dabla‑Norris, Deputy Director of the Fiscal Affairs Department, and Davide Furceri, who is the Division Chief of the Fiscal Affairs Department. Good morning, Vitor, Era, Davide.

    Before taking your questions, let me kick‑start our briefing by turning to you, Vitor, for your opening remarks. Vitor, the floor is yours.

    Mr. Gaspar: Thank you so much, Tatiana. Good morning, everybody. Thank you all for your interest in the Fiscal Monitor, covering fiscal policies all around the world. Deficits are high and global public debt is very high, rising, and risky. Global public debt is projected to go above $100 trillion this year. At the current pace, the global debt‑to‑GDP ratio will approach 100 percent by the end of the decade, rising above the pandemic peak. But the message of high and rising debt masks considerable diversity across countries. I will distinguish three groups.

    Public debt is higher and projected to grow faster than pre‑pandemic in about one third of the countries. This includes not only the largest economies, China and the United States, but also other large countries such as Brazil, France, Italy, South Africa, and the United Kingdom, representing in total about 70 percent of global GDP.

    In another one third of the countries, public debt is higher but projected to grow slower or decline compared with pre‑pandemic.

    In the rest of the world, debt is lower than pre‑pandemic. The Fiscal Monitor makes the case that public debt risks are elevated, and prospects are worse than they look. The Fiscal Monitor presents a novel framework, debt at risk, that illustrates risks around the most likely debt projection at various time horizons. Here we concentrate on the next 3 years.

    Our analysis shows that risks to public debt projections are tilted to the upside. In a severe adverse scenario, public debt would be 20 percentage points of GDP above the baseline projection. In most countries, fiscal plans that governments have put in place are insufficient to deliver stable or declining public debt ratios with a high degree of confidence. Additional efforts are necessary. Delaying adjustment is costly and risky. Kicking the can down the road will not do. The time to act is now. The likelihood of a soft landing has increased. Monetary policy has already started to ease in major economies. Unemployment is low in many countries. And, therefore, given these circumstances, most economies are well‑positioned to deal with fiscal adjustment.

    But it does matter how it is done. While the specific circumstances depend on—while specifics depend on country circumstances, the Fiscal Monitor and earlier IMF work provide useful pointers. For example, countries should avoid cuts in public investment. This can have severe effects on growth. Good governance and transparency improve the prospects of public understanding and social acceptance of fiscal reforms.

    Countries that are sufficiently away from debt distress should adjust in a sustained and gradual way to contain debt vulnerabilities without unnecessary adverse effect on growth and employment. However, in countries in debt distress or at high risk of debt distress, timely and frontloaded decisive action to control public debt or even debt restructuring may be necessary. Everywhere, fiscal policy, as structural policy, can make a substantial contribution to growth and jobs.

    What is the bottom line? Public debt is very high, rising, and risky. The time is now to pivot towards a gradual, sustained, and people‑focused fiscal adjustment.

    My colleagues and I are ready to answer your questions. Thank you for your attention and interest.

    The Moderator (Ms. Mossot): Thank you, Vitor. So, we will open the floor for questions. Thank you.

    Question: Good morning, given your findings on the increasing trend of spending across the political spectrum, how do governments then plan to balance the urgent need, as you stated, for investment in critical areas like healthcare and climate adaptation with the risks of what you also stated, overly optimistic debt projections?

    Ms. Dabla‑Norris: Thank you, global debt is very high, 100 trillion this year and rising. And debt risks, all the ones you mentioned, are also very elevated. So, policymakers are now facing a fundamental policy trilemma, to maintain debt sustainability, amid very high levels of debt in some countries, to accommodate the spending pressures for climate adaptation, for development goals, for population aging, and at the same time to garner support that is needed for reforms. This is why we are calling for a strategic pivot in public finances for countries to put their public finances in order. And why is this important? Because this can help create room that is needed for the priority spending. It can create fiscal space to combat future shocks that will surely come. And it can also help sustain long‑term growth.

    What this means is that for some countries, a very decisive implementation of reforms is needed now, under current plans. For many others, an additional adjustment is required that needs to be gradual but sustained. And yet for others with very high debt levels that are rising, a more frontloaded adjustment will be needed.

    These efforts, these fiscal efforts need to be people‑focused, because you want to balance the trade‑off between these measures adversely impacting growth and inequality. So, here it is important to seek to preserve public spending. It is important to seek to preserve social spending. And improving the quality, the composition, the efficiency of government spending can ensure that every dollar that is spent has maximum impact. It creates room for other types of spending without adding to debt pressures.

    Mobilizing revenues, setting up broad‑based and fair tax systems can allow countries to collect revenues to meet their spending needs. And this is particularly important in the case of emerging market and developing economies, which have considerable untapped tax potential.

    But I think it is also important to note that policymakers need to build the trust that taxpayer’s resources that are being collected will be well‑spent. This is why we are emphasizing strengthening governance, improving fiscal frameworks to build that trust that is needed for reforms.

    Ms. Mossot: We will go to this side of the room. The gentleman in the fourth row.

    Question: Thank you for doing this. I was wondering if you could please drive us a bit further to the debt‑at‑risk framework. Thank you.

    Mr. Furceri: Thank you. The debt risk is a framework that links current macroeconomic, financial, and political conditions to the entire spectrum of the future debt outcomes. So, in some sense it goes beyond the point focus that we typically provide, and it enables economic policymakers to first quantify what are the risks surrounding the debt projections and, second, what are the sources of this risk.

    The current framework estimates that in a severely adverse scenario but plausible, debt to GDP could be 20 percentage points higher in the next 3 years than currently projected. Why is this the case? This is because there are risks related to weaker growth, tighter financial conditions, as well as economic and political uncertainty.

    Another point that the Fiscal Monitor makes is that beyond this global level, the debt to risk associated to the global level, there is significant heterogeneities across countries. For example, in the case of advanced economies, our estimates of data risk are about 135 percent to GDP by 2026. This is a high level. It is lower than what we observed during the peak of the pandemic, but it is high, and it indeed is even higher than what we observed during the Global Financial Crisis.

    In the case of emerging market economies, what we see is that debt risk is increasing even compared to the pandemic and our estimate is about 88 percentage points of GDP.

    Summarizing, we think that this is a framework that could be useful to quantify a risk, identify the sources, and then make a response to this risk.

    Ms. Mossot: We will take another question in the room before going online.

    Question: Thank very much. I would like to know, Vitor, how can fiscal governance be strengthened to ensure long‑term fiscal adjustments, and while at it, what are the risks if fiscal adjustments are delayed, and how would that affect global financial markets? My second question, what lessons can be learned from countries that have successfully managed high debt levels in the past and how can transparency and accountability in public finance be improved to build trust and ensure effective debt management?

    Mr. Gaspar: Thank you so much. I will start with the timing. So I have already emphasized that delaying adjustment is costly and risky. You come from Ghana. If you allow me to place your question in the context of the sub‑Saharan Africa more broadly. I would argue that building fiscal space is not only crucial to limit public debt risks, but in many countries in sub‑Saharan Africa, it is key to enable this state to play its full role in development, which is, of course, a very important priority in the region.

    You asked about lessons from experience. I would say that fiscal adjustment should be timely. It should be decisive. It should be well‑designed. And it should be effectively communicated. And you have pointers on all of this in the Fiscal Monitor.

    You asked a very important question on governance. I would put it together with transparency and accountability. Era has already commented on why it is so important from a political viewpoint, but we have been working in this area for many years. For example, the IMF has a code on fiscal transparency that is extremely interesting. Something that also came up in a seminar that I participated in yesterday is the opportunities afforded by technology to make progress on governance. One of the speakers from India introduced this idea of three Ts that I found very inspiring. The three Ts are technology that is used to promote transparency. And if you have technology and transparency, you should expect to gain trust. And if you have trust, you have the citizens behind the government and, therefore, even willing to pay taxes, not necessarily happily, but in a quasi-voluntary way.

    Ms. Mossot: Thank you, Vitor. We have a question from Forbes, Mexico.” I have a question in countries like Mexico where fiscal consolidation is necessary. What are the biggest risks of this consolidation and how could it boost economic growth?” This is a question for Era.

    Ms. Dabla‑Norris: So, as we have said more generally, the design of fiscal adjustment is what really matters. And there is a right way to do it, and there are many wrong ways to do it.

    In the Fiscal Monitor, we illustrate how countries can undertake fiscal adjustment in a way that is what we call people focused. By that I mean, we want to trade off the negative impacts of the adjustment on growth and on inequality. And we do this by looking at different types of fiscal instruments. And different instruments have very different impacts. So, for example, progressive taxes have a very different impact on consumption and incentives to work and save as compared to other types of taxation.

    Similarly, cutting public investment has both negative short‑run effects on growth and wages, as well as more medium‑term impacts on growth. Cutting regressive energy subsidies similarly have much less of a deleterious impact on income and the consumption of the poor.

    So depending upon the country context, depending upon whether there is scope to raise revenues in non‑distortionary ways, depending upon the nature and the composition of public spending, there are ways for countries to do fiscal adjustment in a manner that is growth‑friendly and people‑friendly.

    Ms. Mossot: So, the last one we have from online is for you, Davide. “The report suggests that low‑income development countries should build tax capacity and improve spending efficiency. Given the high levels of debt and limited resources in these countries, how realistic are these recommendations without substantial international financial support?”

    Mr. Furceri: Indeed, many developing countries face significant pressing spending needs. For sustained development goals, to achieve climate goals, our estimate in the previous Fiscal Monitor suggests that the envelope of these spending needs could be as much as high as 16 percent of GDP.

    So, in this context, one important policy action is to increase revenue through revenue mobilization. Now, it is important that this revenue mobilization strategy is guided by the principle that make the tax system more efficient, more equitable, and more progressive. So policies could be, for example, to reduce informalities, broaden the tax base, increase efficiency in revenue collections, as well as progressivity.

    In the report, we also make the point that improving fiscal institutions, as also Era mentioned, is key to garner public support and to make sure that the debt system is indeed efficient.

    There is also policy on the spending side, improving the quality, the composition, and the efficiency spending to make sure that each dollar spent is well spent, is spent on the key priority areas, and maximizing it.

    Now, there are countries that will need help. The IMF as in the past years and as always has provided significant advice to countries from policy support, policy advice but also financing support. Just to give a number, over the past 4 years, about $60 billion of funding has been provided to African economies to help their challenge. And important, the IMF is also providing a variety of capacity development to support, including exactly in this area, for example, increase Public Finance Management, improve taxation, revenue mobilization, as well as a new area that are developing that are becoming more and more important, such as climate change.

    The Moderator (Ms. Mossot): Thank you. The gentleman with his book in the hand.

    Question: Thank you. You mentioned in the report that developed economies, including the United Kingdom, face risks if they do not bring debt down. We have a budget next week. Perhaps you could tell us what are those risks if the U.K. does not address its debt position quickly?

    Mr. Gaspar: So, when we think about the United Kingdom, the United Kingdom is one of the countries that I listed where debt is substantially higher than it was projected pre‑pandemic. It is also one of the countries where debt is projected to increase over time, albeit at a declining pace.

    If I were to give you my concern about the U.K., I would use what Kristalina Georgieva, the Managing Director of the Fund, emphasizes a theme through these Annual Meetings, the combination of high debt and low growth. For the case of the United Kingdom, I would put it as follows. The United Kingdom is living with interest rates that are close to U.S. interest rates, but it is also living with growth rates that are not close to U.S. growth rates. And that leads to a theme that has been amply debated in the United Kingdom, which is the importance of public investment.

    In the United Kingdom, as in many other advanced economies, public investment as a percentage of GDP has been trending down. And given challenges associated with the energy transition, new technologies, technological innovation, and much else, public investment is badly needed. The Fiscal Monitor emphasizes that public investment should be protected in the framework of a set of rules and budgetary procedures that foster sound macroeconomic performance. The fact that that debate is very much at the center of the debate in the United Kingdom right now is very much welcome.

    Ms. Mossot: We will take another question on this side. The lady in green.

    Question: Thank you. After 3 years of consolidation, fiscal deficits are widening in the western Balkans. The public expenditures are increasing but more on social debt—more on social spendings than on capital spendings. How do you evaluate the economic situation in this region?

    Ms. Dabla‑Norris: So, in western Balkans as a whole, growth has picked up since 2023, although there are differences across countries. For example, in North Macedonia, growth is projected to be 2.2 percent in 2024, down from 2.7 percent in 2023. But for the region, the growth momentum is expected to continue in 2025.

    Now, when it comes to inflation, we see that headline inflation continues to ease throughout the region, but core inflation remains stubbornly high in some countries.

    In terms of fiscal and debt, the differential—the interest and growth differential for the region is projected to remain negative over the medium term. And this is a good thing because it is favorable to debt dynamics, but this gap is closing. It is narrowing over time.

    So, what is important at this juncture for these countries is to sustainably lift their growth prospects. And the IMF has spoken at length about the importance of structural and fiscal structural reforms that are needed to improve the composition of spending, to lift public investment sustainably and to undertake the labor and product market reforms that are required to sustainably boost productivity.

    Ms. Mossot: Thank you. Back to the center of the room.

    Question: Thanks for taking my question. I wanted to ask about France. Do you believe that the French government’s plans to return to a budget deficit of less than 3 percent by 2029 is realistic, given the size of the deficit you project for France this year?

    Mr. Gaspar: So, when it comes to France, we have a country that is also in the group of countries where debt is considerably higher than pre‑pandemic. At this point in time, in our projections, the debt‑to‑GDP ratio in France is projected to increase by about 2 percentage points every year. So, given this path, we recommend in the case of France not only fiscal adjustment but fiscal adjustment that is appropriately frontloaded to enable France to credibly put public debt under control and inside the European framework.

    That is completely in line with our general recommendation because the European framework allows for a country‑specific path. It allows for risks to be considered. It allows for the impact of the investment and structural reform to be internalized through an adjustment period that varies, according to cases, from 5 to 7 years.

    We do believe that the government in France has presented ideas, proposals that move in the right direction, but we are waiting for more clarity coming from actual enacted measures in France.

    Ms. Mossot: Another one here, the lady in blue there.

    Question: Thank you. May I have an insight about public debt in Tunisia and reasons beyond not mentioning it in your report? Thank you.

    Mr. Furceri: For the specific numbers for Tunisia, I would defer to the regional press briefs that is coming in the coming days. What I would like to point out, that one of the challenges that we see in many countries in North Africa, it also relates with the untargeted subsidies. And one point that we make in the report is that, also as Era mentioned, that when you think about how to recalibrate spending, it is important to preserve public investment. It is important to present targeted transfers for those that are most vulnerable, and to recalibrate the spending, for example, from away from high wage compensation when this is not the case, and untargeted subsidies.

    Ms. Mossot: Thank you. This side, second row, the gentleman.

    Question: I just had a question about the U.S. election. As you know, both candidates are offering many tax breaks, no taxes on tips, no tax on social security on the Trump side. These would add to the deficit of the U.S. on the Trump side as much as $7 and a half trillion over 10 years. Some estimates more than 10 trillion. Kamala Harris’ plans would call for less debt because she would raise taxes in some cases. But I am just wondering, the worse‑case scenario, how concerned are you about the amount of debt that the U.S. could be adding here? It seems to be the opposite of what the IMF has been recommending for a long time. Do you have concerns about financial markets taking matters into their own hands and imposing some discipline?

    Mr. Gaspar: Thanks, I am clearly not commenting on specific elections or political platforms, but I point to you that the Fiscal Monitor in the spring was dedicated to the great election year, and there we do make a number of comments about the relevance of politics for fiscal policy. And Era, has very interesting research where she documents that political platforms on the left and on the right all around the world have turned in favor of fiscal support and fiscal expansion. And that makes the job of the Ministers of Finance around the world and the Secretary of Treasury here in the United States a particularly demanding job, but Era may want to comment on that.

    When it comes to the United States, the United States is one of the largest economies where it is a fact that debt is considerably above what it was pre‑pandemic. It is growing at about 2 percentage points of GDP every year. And so from that viewpoint, this path of debt cannot continue forever. We do believe that the situation in the United States is sustainable because the policymakers in the United States have access to many combinations of policy instruments that enable them to put the path of public debt under control. And they will do that at a time and with the composition of their choosing. The decision lies with the U.S. political system.

    Now, it is very important to understand that the United States is now in a very favorable economic and financial situation. Financing conditions are easing in the United States. The Fed has already started its policy pivot. The growth in the United States has been outperforming that of other advanced economies. The labor market in the United States shows indicators that are the envy of many other countries. And so the prescription that the time to adjust is now applies to the United States. It turns out that the Fiscal Monitor also documents that the United States is very important for the determination of global financial conditions and, therefore, adjustment in the United States is not only good for the United States, it is good also for the rest of the world.

    Ms. Mossot: Back to the center of the room. The lady with the red shirt, please.

    Question: My question is, whether you can comment on China’s recent stimulus package and as you mentioned in the opening, it seems that the largest economies, including China and the United States, is projected to keep raising its public debt, so I wonder how you are going to comment on the fiscal implication of the stimulus package, and do you have any other specific fiscal policy for China? Thank you.

    Mr. Gaspar: Thank you for your question. China is very important. China is one of the largest economies that I listed. The other is the United States. For China and for the United States, we say the same. Debt is growing. Debt is growing rapidly. That process cannot continue forever, but China, as the United States, has ample policy space. And so it has the means to put public debt in China under control with the policy composition and the timing that will be the choice of the Chinese political system.

    If I were to say what is most important for me for China, I would say four things. The first one is that fiscal policy, as structural policy, should contribute to the rebalancing of the Chinese economy in the sense of changing the composition of demand from exports to domestic demand. It is very important that the very high savings ratio in China diminishes so that Chinese households will be able to consume more and feel safe doing that. Making the social safety net in China wider would be a structural way of doing exactly that.

    The second aspect is to act decisively to end financial misallocations associated with the property sector crisis, the real estate crisis. That is very important to stabilize the situation in China but also to build confidence, which would help with the first dimension that I pointed out as well.

    Now, third, very much in the province of public finances, this is very important to address public finance imbalances and vulnerabilities at the sub‑national level. And now, there are sub‑national governments in China that are struggling with financial conditions—financial constraints, and it is very important to remove those constraints, and, again, is linked to my second point.

    Fourth and last, it is very important that fiscal policy, as structural policy, promotes the transition to a new growth model in China, a model based on technological innovation, a model that supports the structural transformation towards a green economy. And my understanding is that this fourth element has been emphasized by the political authorities in China at the highest level.

    Ms. Mossot: Thank you. Back to this side of the room.

    Question: As already mentioned, a novel assessment framework debt that is at risk varies from country to country. Please, could you provide me details, which risks are more important and more dangerous for Ukrainian debt? And one more related question. It is that you give advice for emerging markets to increase indirect taxes for revenue mobilization. And in the case of Ukraine, when we recently already increased our taxes, for example, war tax and tax for banks’ profits, which recommendations you can give us in our situation and the worse circumstances, and maybe there are other instruments despite tax increasing.

    Ms. Dabla‑Norris: Thank you. The debt‑at‑risk framework that has been presented in the Fiscal Monitor includes 70 countries, but we do not identify or quantify the debt at risk for all individual countries. Now, that said, the framework, as Davide mentions, shows that factors such as weak growth, tighter financial conditions, geopolitical uncertainty, or policy uncertainty can all add to future debt risks. This applies to Ukraine as it does to many other countries. And in the case of Ukraine particularly, the outlook, as you know, remains exceptionally uncertain.

    So, in terms of priorities, we believe that the authorities need to continue to restore debt sustainability. And in this regard, there is two important aspects. The first is to complete the restructuring of external commercial debt in line with program commitments. And the second is to really redouble efforts on domestic revenue mobilization and to accelerate the implementation of their national revenue strategy. Now, what is important here is the strategy is not only about aiming to raise revenues, mobilize revenues, but to fundamentally change the tax system. The strategy aims to reduce tax evasion, tax avoidance, to improve tax compliance, and more broadly enhance the fairness and equity of the tax system. And the IMF has long advocated for countries that it is not about raising rates. It is about broadening the base and making tax systems as fair and equitable as possible.

    Ms. Mossot: Back to this side. The gentleman on the second row.

    Question: I just want to ask a couple of questions, blended into one. In July, the IMF released calculations showing that the U.K. budget balance, excluding interest payments, would need to improve by between .8 and 1.4 percentage points of GDP per year to get debt under control, an adjustment of 22 to 39 billion pounds. Since then, we know that the Treasury has carried out an audit and discovered over‑spends it was not aware of, and the government has made decisions on things like public sector pay. So my question to you is, how has that changed the calculations you made in July? You talked about the importance of people‑focused adjustments. Would an increase in employer national insurance contributions be people‑friendly and growth‑friendly in your view?

    Mr. Gaspar: Thank you so much. So, your questions are very detailed and very specific, and so I am not in a position to comment on them at this point in time. Concerning the U.K., we believe it is very important to bring public debt under control. It is very important to control for public debt risks. In the Fiscal Monitor, we actually make the point that the risks that one should take into account when conducting a prudent fiscal policy go beyond the reference to the baseline that you made. So we believe that it is possible to make a stronger case for fiscal prudence than what was implicit in your question.

    Still, it is important how the adjustment is made, and Era has emphasized very much the importance of being people‑friendly. And we, all of us, have emphasized the important contribution of public investment. And there you do have specific estimates for the U.K., impacts of public investment on economic activity and growth from the Office of Budget’s responsibility. I do not know if you want to add something.

    Ms. Dabla‑Norris: No. Just to say that there are important tradeoffs, not just for the U.K., but for many countries, and there may be certain short‑term measures that see or appear to be less people‑friendly but that they improve the sustainability of the system for future generations. So there is an intertemporal aspect of this, referring to fiscal policy, that we often forget. So, pension systems, health systems, the sustainability, the fiscal sustainability of the system also matters for people because it is going to impact different generations in a different way.

    Ms. Mossot: The very last question.

    Question: Thank you. I would like to ask, what are the prescriptions on how developing countries can put their public debt in order, especially sub‑Saharan Africa? And, for example, Nigeria now and many other countries in Africa, their public debt has ballooned because of exchange rates devaluation. So what are your prescriptions? You also mentioned the tax systems should be friendly. In Africa, we are not seeing tax systems as being friendly now because a lot of people, they say, okay, why did not the tax base broaden? How much can you broaden since you have a lot of poor people? So, what kinds of tradeoffs do you do when incomes and people are also squeezed?

    The last one is from the report. $100 trillion of global debt. How much of that is from developing economies? Thank you.

    Mr. Furceri: Thank you very much. The challenges that Nigeria faces, as well as many other countries in the region, there are two. One is very low revenue‑to‑GDP ratio. For example, I believe that in the case of Nigeria it is about 10 percentage points. The second, one trend that we have seen, that we are a bit concerned, is that the ratio—the debt service obligation to revenue has been increasing. So for the average low‑income country, it is about 15 percent. What does it mean? It means that basically a large part of revenue in these countries goes to just finance the debt. And this is something that we would recommend to improve, or we can improve as we mentioned revenue mobilization. We think that it is important. It is important to broaden the tax base. But at the same time, and especially in countries like Nigeria that have been severely affected by the drought, we have seen also higher food price, it is important to put in place ex ante system and mechanisms that are transfer resources from the government to those that are most affected and those that are poor.

    Ms. Mossot: Thank you very much. We have to close this session. Thank you again Era, Davide, and Vitor. You can find the full report of the Fiscal Monitor on the IMF website and also a reminder that there is tomorrow at 8:00 a.m. the Managing Director’s press conference. Thank you, all.

    IMF Communications Department
    MEDIA RELATIONS

    PRESS OFFICER:

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

    @IMFSpokesperson

    MIL OSI Economics –

  • MIL-OSI Security: Austin Confirms North Korea Has Sent Troops to Russia

    Source: United States INDO PACIFIC COMMAND

    Secretary of Defense Lloyd J. Austin III confirmed there are North Korean troops in Russia, but it is unclear if they are preparing to become a co-belligerent in Russia’s war on Ukraine. 

    “We are seeing evidence that there are North Korean troops that have gone to … Russia,” Austin told reporters in Rome. “What exactly they are doing is left to be seen. These are things that we need to sort out.” 

    Austin said the United States is trying to get fidelity on why the North Korean soldiers are in Russia. “We will continue to pull this thread and see what happens here,” he said. “If they’re co-belligerents — [if] their intention is to participate in this war on Russia’s behalf  — that is a very, very serious issue.” Impacts of such a move would be felt not only in Europe, but the Indo-Pacific region also, the secretary said. 

    Austin noted that South Korean leaders are intently watching this play out.  

    North Korea is one of Russia’s few open allies in its unjust war on Ukraine. North Korea has shipped arms and munitions to Russia, “and this is a next step,” Austin said.
     

    President Vladimir Putin has taken significant casualties in his misguided war on Ukraine. U.S. officials said recently that Russia has lost more than 300,000 service members since the war began in February 2022. “This is an indication that he may be [in even] more trouble than most people realize,” Austin said. “But again, he went ‘tin-cupping’ early on to get additional weapons and materials from [North Korea], and then from Iran and now he’s making a move to get more people, if … these troops are designed to be a part of the fight in Ukraine.” 

    Austin spoke at the end of a long trip where he first participated in the last NATO Defense Ministerial of the Biden Administration. He then moved to Rome where he took part in the first G-7 Defense Ministers Meeting. He made an unannounced trip to Kyiv where he met Ukrainian President Volodymyr Zelenskyy and his defense leadership. He returned to Rome and met with Pope Francis in the Vatican.

    Austin said the Pope is focused on the conflicts in Ukraine and the Middle East. “He is concerned about humanitarian issues in both areas, and of course, we share a common desire to see these conflicts scale back in terms of the level of activity and in a ceasefire,” Austin said.

    MIL Security OSI –

  • MIL-OSI Security: Readout of Chairman of the Joint Chiefs of Staff Gen. CQ Brown, Jr.’s Meeting with Ireland’s Chief of Staff of the Defence Forces Lt. Gen. Seán Clancy

    Source: US Defense Joint Chiefs of Staff

    Office of the Chairman of the Joint Chiefs of Staff Public Affairs

    October 23, 2024

    WASHINGTON, D.C. — Joint Staff Spokesperson Navy Capt. Jereal Dorsey provided the following readout:

    Chairman of the Joint Chiefs of Staff Gen. CQ Brown, Jr., met with Ireland’s Chief of Staff of the Defence Forces Lt. Gen. Seán Clancy today at the Pentagon.

    The military leaders discussed Ireland’s defense modernization efforts and the current security environment in the Middle East. Gen. Brown also thanked Ireland for its willingness to provide training and non-lethal aid to Ukraine in defense of its sovereign territory.

    Gen. Brown congratulated Lt. Gen. Clancy on his recent election as the next chairman of the European Union Military Committee and stated he looks forward to welcoming Ireland’s first defense attaché to Washington.

    MIL Security OSI –

  • MIL-OSI: Euronet Worldwide Reports Third Quarter 2024 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    LEAWOOD, Kan., Oct. 23, 2024 (GLOBE NEWSWIRE) — Euronet Worldwide, Inc. (“Euronet” or the “Company”) (NASDAQ: EEFT), a leading global financial technology solutions and payments provider, reports third quarter 2024 financial results.

    Euronet reports the following consolidated results for the third quarter 2024 compared with the same period of 2023:

    • Revenues of $1,099.3 million, a 9% increase from $1,004.0 million (9% increase on a constant currency1 basis).
    • Operating income of $182.2 million, a 9% increase from $167.0 million (9% increase on a constant currency basis).
    • Adjusted EBITDA2 of $225.7 million, a 6% increase from $212.5 million (6% increase on a constant currency basis).
    • Net income attributable to Euronet of $151.5 million, or $3.21 diluted earnings per share, compared with $104.2 million, or $2.05 diluted earnings per share.
    • Adjusted earnings per share3 of $3.03, an 11% increase from $2.72.
    • Euronet’s cash and cash equivalents were $1,524.1 million and ATM cash was $805.4 million, totaling $2,329.5 million as of September 30, 2024, and availability under its revolving credit facilities was approximately $669.8 million.

    See the reconciliation of non-GAAP items in the attached financial schedules.  

    “I am pleased that we achieved a third quarter adjusted EPS of $3.03, an 11% increase over the prior year’s $2.72. I also point out that we did not include in our adjusted EPS approximately $0.28 per share related to an investment gain. Had we done so, adjusted EPS would have been $3.31. This year’s third quarter is a great reminder of how our product and geographic diversity helps to provide consistency in our earnings. Moreover, with our 17% nine months year to date adjusted EPS growth, we are well on track to be at the top end of the range with good prospects to exceed the range,” stated Michael J. Brown, Euronet’s Chairman and Chief Executive Officer. 

    “Money Transfer produced strong third quarter results compared to the prior year across all financial metrics. EFT produced solid results across all metrics with double digit growth in operating income and adjusted EBITDA. epay delivered double-digit revenue and transaction growth.”

    Taking into consideration recent trends in the business and the global economy, continued double-digit quarterly earnings growth, and historical seasonal patterns, the Company remains confident in its previously announced expectations that its 2024 adjusted EPS will grow 10-15% year-over-year, consistent with its 10 and 20 year compounded annualized growth rates. Moreover, the Company expects that in 2025 it will again produce adjusted EPS growth in the 10-15% range. This outlook does not include any changes that may develop in foreign exchange rates, interest rates or other unforeseen factors.

    Segment and Other Results

    The EFT Processing Segment reports the following results for the third quarter 2024 compared with the same period or date in 2023:

    • Revenues of $373.0 million, an 8% increase from $345.8 million (7% increase on a constant currency basis).
    • Operating income of $117.3 million, a 12% increase from $104.8 million (12% increase on a constant currency basis).
    • Adjusted EBITDA of $142.1 million, a 10% increase from $128.7 million (10% increase on a constant currency basis).
    • Transactions of 2,982 million, a 34% increase from 2,231 million.
    • Total of 55,292 installed ATMs as of September 30, 2024, a 4% increase from 53,272. We operated 54,020 active ATMs as of September 30, 2024, a 5% increase from 51,496 as of September 30, 2023.

    Constant currency revenue, operating income, and adjusted EBITDA growth in the third quarter 2024 was driven by travel, growth in the merchant services business and growth within recent market expansion. Operating margins benefited from transactions driven by continued travel recovery together with effective expense management.

    The increase in active ATMs includes the acquisition of 800 ATMs in Malaysia together with the addition of approximately 800 outsourcing ATMs, and the impact of winterizing 500 more ATMs in the prior year at September 30, 2023, compared to September 30, 2024.

    Transaction growth outpaced revenue growth due to continued growth in high-volume low-value transactions in India. 

    The epay Segment reports the following results for the third quarter 2024 compared with the same period or date in 2023:

    • Revenues of $290.3 million, a 10% increase from $264.5 million (10% increase on a constant currency basis).
    • Operating income of $29.1 million, a 3% increase from $28.3 million (2%  increase on a constant currency basis).
    • Adjusted EBITDA of $31.0 million, a 3% increase from $30.1 million (3% increase on a constant currency basis).
    • Transactions of 1,126 million, a 22% increase from 925 million.
    • POS terminals of approximately 766,000 as of September 30, 2024, a 5% decrease from approximately 810,000.
    • Retailer locations of approximately 348,000 as of September 30, 2024, unchanged from prior year.

    Double-digit revenue and transaction growth was driven by continued digital media and mobile growth. Operating income and adjusted EBITDA growth did not keep pace with the overall growth in revenue due to inflationary pressures in the business and expenses incurred to launch new proprietary product offerings.

    The Money Transfer Segment reports the following results for the third quarter 2024 compared with the same period or date in 2023:

    • Revenues of $438.2 million, an 11% increase from $395.9 million (10% increase on a constant currency basis).
    • Operating income of $58.1 million, an 8% increase from $53.7 million (7% increase on a constant currency basis).
    • Adjusted EBITDA of $64.1 million, a 6% increase from $60.7 million (4% increase on a constant currency basis).
    • Total transactions of 45.1 million, an 11% increase from 40.6 million.
    • Network locations of approximately 595,000 as of September 30, 2024, a 10% increase from approximately 540,000.

    Constant currency revenue growth was primarily driven by near double-digit growth in cross-border transactions, offset by a decrease in intra-US transactions. Direct-to-consumer digital transactions grew by 30%, reflecting strong consumer demand for digital products, which represents 19% of total digital transactions. The constant currency operating income increase of 7% was influenced by an additional $2 million year-over-year digital customer marketing spend during the quarter versus last year. Excluding the incremental digital customer marketing spend, constant currency operating income growth would have exceeded 10%, producing operating margins consistent with prior year. Money Transfer’s revenue and gross profit per transaction were consistent with the prior year.

    Corporate and Other reports $22.3 million of expense for the third quarter 2024 compared with $19.8 million for the third quarter 2023. The increase in corporate expenses is largely from increased salaries, performance-based compensation and other management expenses.

    Balance Sheet and Financial Position
    Unrestricted cash and cash equivalents on hand was $1,524.1 million as of September 30, 2024, compared to $1,271.8 million as of June 30, 2024.  The net increase in unrestricted cash and cash equivalents is the net result of the generation of cash from operations and working capital fluctuations partially offset by share repurchases.

    Total indebtedness was $2,278.8 million as of September 30, 2024, compared to $2,270.2 million as of June 30, 2024. Availability under the Company’s revolving credit facilities was approximately $669.8 million as of September 30, 2024.

    The Company repurchased 1 million shares for $101.3 million during the third quarter, which will improve earnings per share by 2% for future periods.

    Non-GAAP Measures
    In addition to the results presented in accordance with U.S. GAAP, the Company presents non-GAAP financial measures, such as constant currency financial measures, operating income, adjusted EBITDA, and adjusted earnings per share. These measures should be used in addition to, and not a substitute for, revenues, operating income, net income and earnings per share computed in accordance with U.S. GAAP. We believe that these non-GAAP measures provide useful information to investors regarding the Company’s performance and overall results of operations. These non-GAAP measures are also an integral part of the Company’s internal reporting and performance assessment for executives and senior management. The non-GAAP measures used by the Company may not be comparable to similarly titled non-GAAP measures used by other companies. The attached schedules provide a full reconciliation of these non-GAAP financial measures to their most directly comparable U.S. GAAP financial measure.

    The Company does not provide a reconciliation of its forward-looking non-GAAP measures to GAAP due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for GAAP and the related GAAP and non-GAAP reconciliation, including adjustments that would be necessary for foreign currency exchange rate fluctuations and other charges reflected in the Company’s reconciliation of historic numbers, the amount of which, based on historical experience, could be significant.  

    (1) Constant currency financial measures are computed as if foreign currency exchange rates did not change from the prior period. This information is provided to illustrate the impact of changes in foreign currency exchange rates on the Company’s results when compared to the prior period.

    (2) Adjusted EBITDA is defined as net income excluding, to the extent incurred in the period, interest expense, income tax expense, depreciation, amortization, share-based compensation and other non-operating or non-recurring items that are considered expenses or income under U.S. GAAP. Adjusted EBITDA represents a performance measure and is not intended to represent a liquidity measure.

    (3) Adjusted earnings per share is defined as diluted U.S. GAAP earnings per share excluding, to the extent incurred in the period, the tax-effected impacts of: a) foreign currency exchange gains or losses, b) share-based compensation, c) acquired intangible asset amortization, d) non-cash income tax expense, e) non-cash investment gain f) other non-operating or non-recurring items and g) dilutive shares relate to the Company’s convertible bonds. Adjusted earnings per share represents a performance measure and is not intended to represent a liquidity measure. 

    Conference Call and Slide Presentation
    Euronet Worldwide will host an analyst conference call on October 24, 2024, at 9:00 a.m. Eastern Time to discuss these results. The call may also include discussion of Company developments on the Company’s operations, forward-looking information, and other material information about business and financial matters. To listen to the call via telephone please register at Euronet Worldwide Third Quarter 2024 Earnings Call. The conference call will also be available via webcast at http://ir.euronetworldwide.com. Participants should register at least five minutes prior to the scheduled start time of the event. A slideshow will be included in the webcast. 

    A webcast replay will be available beginning approximately one hour after the event at  http://ir.euronetworldwide.com and will remain available for one year.

    About Euronet Worldwide, Inc.
    Starting in Central Europe in 1994 and growing to a global real-time digital and cash payments network with millions of touchpoints today, Euronet now moves money in all the ways consumers and businesses depend upon. This includes money transfers, credit/debit card processing, ATMs, POS services, branded payments, foreign currency exchange and more. With products and services in more than 200 countries and territories provided through its own brand and branded business segments, Euronet and its financial technologies and networks make participation in the global economy easier, faster and more secure for everyone. 

    A leading global financial technology solutions and payments provider, Euronet has developed an extensive global payments network that includes 55,292 installed ATMs, approximately 949,000 EFT POS terminals and a growing portfolio of outsourced debit and credit card services which are under management in 113 countries; card software solutions; a prepaid processing network of approximately 766,000 POS terminals at approximately 348,000 retailer locations in 64 countries; and a global money transfer network of approximately 595,000 locations serving 205 countries and territories. Euronet serves clients from its corporate headquarters in Leawood, Kansas, USA, and 67 worldwide offices. For more information, please visit the Company’s website at www.euronetworldwide.com.

    Statements contained in this news release that concern Euronet’s or its management’s intentions, expectations, or predictions of future performance, are forward-looking statements. Euronet’s actual results may vary materially from those anticipated in such forward-looking statements as a result of a number of factors, including: conditions in world financial markets and general economic conditions, including impacts from the COVID-19 or other pandemics; inflation; the war in the Ukraine and the related economic sanctions; military conflicts in the Middle East; our ability to successfully integrate any acquired operations; economic conditions in specific countries and regions; technological developments affecting the market for our products and services; our ability to successfully introduce new products and services; foreign currency exchange rate fluctuations; the effects of any breach of our computer systems or those of our customers or vendors, including our financial processing networks or those of other third parties; interruptions in any of our systems or those of our vendors or other third parties; our ability to renew existing contracts at profitable rates; changes in fees payable for transactions performed for cards bearing international logos or over switching networks such as card transactions on ATMs; our ability to comply with increasingly stringent regulatory requirements, including anti-money laundering, anti-terrorism, anti-bribery, consumer and data protection and privacy; changes in laws and regulations affecting our business, including tax and immigration laws and any laws regulating payments, including dynamic currency conversion transactions; changes in our relationships with, or in fees charged by, our business partners; competition; the outcome of claims and other loss contingencies affecting Euronet; the cost of borrowing (including fluctuations in interest rates), availability of credit and terms of and compliance with debt covenants; and renewal of sources of funding as they expire and the availability of replacement funding. These risks and other risks are described in the Company’s filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Copies of these filings may be obtained via the SEC’s Edgar website or by contacting the Company. Any forward-looking statements made in this release speak only as of the date of this release. Except as may be required by law, Euronet does not intend to update these forward-looking statements and undertakes no duty to any person to provide any such update under any circumstances. The Company regularly posts important information to the investor relations section of its website.  

     EURONET WORLDWIDE, INC.
     Condensed Consolidated Balance Sheets
     (in millions)
           
      As of    
      September 30,   As of
      2024   December 31,
      (unaudited)   2023
    ASSETS      
    Current assets:      
    Cash and cash equivalents $ 1,524.1   $ 1,254.2
    ATM cash 805.4   525.2
    Restricted cash 18.9   15.2
    Settlement assets 1,461.0   1,681.5
    Trade accounts receivable, net 273.2   370.6
    Prepaid expenses and other current assets 303.2   316.0
    Total current assets 4,385.8   4,162.7
           
    Property and equipment, net 340.3   332.1
    Right of use lease asset, net 142.9   142.6
    Goodwill and acquired intangible assets, net 1,118.9   1,015.1
    Other assets, net 301.2   241.9
    Total assets $ 6,289.1   $ 5,894.4
           
    LIABILITIES AND EQUITY      
    Current liabilities:      
    Settlement obligations $ 1,461.0   $ 1,681.5
    Accounts payable and other current liabilities 877.4   816.9
    Current portion of operating lease liabilities 51.4   50.3
    Short-term debt obligations 1,081.4   151.9
    Total current liabilities 3,471.2   2,700.6
           
    Debt obligations, net of current portion 1,195.5   1,715.4
    Operating lease liabilities, net of current portion 95.4   95.8
    Capital lease obligations, net of current portion 1.9   2.3
    Deferred income taxes 77.6   47.0
    Other long-term liabilities 85.5   83.6
    Total liabilities 4,927.1   4,644.7
    Equity 1,362.0   1,249.7
    Total liabilities and equity $ 6,289.1   $ 5,894.4
     EURONET WORLDWIDE, INC.
     Consolidated Statements of Operations
     (unaudited – in millions, except share and per share data)
           
      Three Months Ended
      September 30,
      2024   2023
           
    Revenues $ 1,099.3     $ 1,004.0  
           
    Operating expenses:      
    Direct operating costs 634.0     576.7  
    Salaries and benefits 169.6     153.6  
    Selling, general and administrative 80.6     73.9  
    Depreciation and amortization 32.9     32.8  
    Total operating expenses 917.1     837.0  
    Operating income 182.2     167.0  
           
    Other income (expense):      
    Interest income 6.5     4.0  
    Interest expense (24.2 )   (15.0 )
    Foreign currency exchange gain (loss) 27.4     (8.8 )
    Other income 16.5     —  
    Total other income (expense), net 26.2     (19.8 )
    Income before income taxes 208.4     147.2  
           
    Income tax expense (56.8 )   (43.0 )
           
    Net income 151.6     104.2  
    Net loss attributable to non-controlling interests (0.1 )   —  
    Net income attributable to Euronet Worldwide, Inc. $ 151.5     $ 104.2  
    Add: Interest expense from assumed conversion of convertible notes, net of tax   1.1       1.1  
    Net income for diluted earnings per share calculation $ 152.6     $ 105.3  
    Earnings per share attributable to Euronet Worldwide, Inc. stockholders – diluted $ 3.21     $ 2.05  
           
    Diluted weighted average shares outstanding 47,554,606     51,470,603  
           
     EURONET WORLDWIDE, INC.
    Reconciliation of Net Income to Operating Income (Expense) and Adjusted EBITDA
     (unaudited – in millions)
                       
      Three months ended September 30, 2024
                       
      EFT Processing   epay   Money Transfer   Corporate Services   Consolidated
                       
    Net income                 $ 151.6  
                       
    Add: Income tax expense                 56.8  
    Less: Total other income, net                 (26.2 )
                       
    Operating income (expense) $ 117.3     $ 29.1     $ 58.1     $ (22.3 )   $ 182.2  
    Add: Depreciation and amortization 24.8     1.9     6.0     0.2     32.9  
    Add: Share-based compensation —     —     —     10.6     10.6  
    Earnings before interest, taxes, depreciation, amortization, share-based compensation (Adjusted EBITDA) (1) $ 142.1     $ 31.0     $ 64.1     $ (11.5 )   $ 225.7  
                       
      Three months ended September 30, 2023
                       
      EFT Processing   epay   Money Transfer   Corporate Services   Consolidated
                       
    Net income                 $ 104.2  
                       
    Add: Income tax expense                 43.0  
    Add: Total other expense, net                 19.8  
                       
    Operating income (expense) $ 104.8     $ 28.3     $ 53.7     $ (19.8 )   $ 167.0  
    Add: Depreciation and amortization 23.9     1.8     7.0     0.1     32.8  
    Add: Share-based compensation —     —     —     12.7     12.7  
    Earnings before interest, taxes, depreciation, amortization and share-based compensation (Adjusted EBITDA) $ 128.7     $ 30.1     $ 60.7     $ (7.0 )   $ 212.5  
    EURONET WORLDWIDE, INC.
    Reconciliation of Adjusted Earnings per Share
    (unaudited – in millions, except share and per share data)
           
      Three Months Ended
      September 30,
      2024   2023
           
    Net income attributable to Euronet Worldwide, Inc. $ 151.5     $ 104.2  
           
    Foreign currency exchange (loss) gain (27.4 )   8.8  
    Intangible asset amortization(1) 5.1     5.5  
    Share-based compensation(2) 10.6     12.7  
    Income tax effect of above adjustments(3) 4.9     (4.7 )
    Non-cash investment gain(4) (16.9 )   —  
    Non-cash GAAP tax expense(5) 8.8     6.2  
           
    Adjusted earnings(6) $ 136.6     $ 132.7  
           
    Adjusted earnings per share – diluted(6) $ 3.03     $ 2.72  
           
    Diluted weighted average shares outstanding (GAAP)   47,554,606     51,470,603  
    Effect of adjusted EPS dilution of convertible notes   (2,781,818 )     (2,781,818 )
    Effect of unrecognized share-based compensation on diluted shares outstanding   320,885     185,073  
    Adjusted diluted weighted average shares outstanding   45,093,673     48,873,858  
     

    (1) Intangible asset amortization of $5.1 million and $5.5 million are included in depreciation and amortization expense of $32.9 million and $32.8 million for both the three months ended September 30, 2024, and September 30, 2023, in the consolidated statements of operations.

    (2) Share-based compensation of $10.6 million and $12.7 million are included in salaries and benefits expense of $169.6 million and $153.6 million for the three months ended September 30, 2024, and September 30, 2023, respectively, in the consolidated statements of operations.

    (3) Adjustment is the aggregate U.S. GAAP income tax effect on the preceding adjustments determined by applying the applicable statutory U.S. federal, state and/or foreign income tax rates. 

    (4) Non-cash investment gain of $16.9 million is included in other income in the consolidated statement of operations.

    (5) Adjustment is the non-cash GAAP tax impact recognized on certain items such as the utilization of certain material net deferred tax assets and amortization of indefinite-lived intangible assets.

    (6) Adjusted earnings and adjusted earnings per share are non-GAAP measures that should be considered in addition to, and not as a substitute for, net income and earnings per share computed in accordance with U.S. GAAP. 

    The MIL Network –

  • MIL-OSI Security: Network smuggling migrants via Belarus busted in Poland

    Source: Europol

    The Polish Border Guard, supported by Europol, has successfully targeted a large criminal network smuggling migrants from Belarus and Russia into the EU. The investigation was conducted within the framework of a Europol Operational Task Force, made up of authorities from Austria, Czechia, Germany, Hungary, Lithuania, Poland, Slovakia, and Ukraine. A Europol expert supported the operation on the ground in…

    MIL Security OSI –

  • MIL-OSI Australia: Press Conference Apia, Samoa

    Source: Australian Government – Minister of Foreign Affairs

    Penny Wong, Foreign Minister: Look, can I say how wonderful it is to be here in Samoa as it hosts its first ever Commonwealth Heads of Government Meeting, the first time this has been held in a Pacific Island country. And Australia has been really pleased to partner with Samoa, and we are really pleased – I’m really pleased to be here, and I know the Prime Minister is very pleased to be able to join us this evening.

    I want to thank a woman for whom I have such great regard, Prime Minister Fiamē, for her leadership, for her hospitality, for her thoughtful hosting of this meeting and, the way in which she has sought to elevate Pacific priorities and voices on the international stage.

    It’s certainly been a busy day today. It kicked off with a meeting about investment, finance and investment, hosted by David Lammy, the UK Foreign Secretary. And we recognise that economic integration and investment are central to development, are central to alleviating poverty and enabling opportunity. And we’re partnering with the United Kingdom to develop a new Commonwealth Investment Network to support Commonwealth members, particularly smaller states who often have challenges accessing finance, accessing investment, to do just that – to attract and access investment.

    I’ve also been at the first session of the Commonwealth Foreign Affairs Ministers Meeting. Obviously, that’s in preparation for the Leaders’ Meeting tomorrow. Top of the agenda is, as you would expect here in Pacific, climate. And as you would have heard me say from the first day I was – I stood in the Pacific as Foreign Minister, and I’ve consistently recognised this as I have travelled throughout the Pacific, climate change is an existential threat. It is the number one national security threat, it is the number one economic threat to the peoples of the Pacific and to many members of the Commonwealth.

    We heard today from a number of African countries, including Zambia, about the escalating impacts of climate change, the effects on food insecurity. And I’m really pleased that we are able to announce a new Africa-Australia partnership for climate responsive agriculture. This is to be developed by the Australian Centre for International Agriculture Research, and it will address food insecurity in the region.

    Can I talk about what this means? One of the things Australia is good at is agriculture in very dry climates – for obvious reason. It is one of the areas we have an expertise, and this – I’m very excited about this partnership because it leverages a particular Australian expertise into a continent for which food insecurity is an ongoing and rising challenge. It’s another example of our commitment as a government to helping partners around the world in the fight against climate change. It’s about shaping the world for the better.

    I’ve also spoken to Pacific leaders about the ways in which Australia is transitioning our entire economy. It’s a big task, started later than it should have, but we are committed to making the very large change.

    I’ve had productive meetings with counterparts from Malta and Solomon Islands, and I’ve just returned from an event hosted by Samoa attended by Her Majesty the Queen, advocating for women and girls in the Commonwealth where we talked about the challenges facing women and girls, including violence against women, and we spoke about Australia’s progress in tackling cervical cancer.

    I’m looking forward to the rest of the program, and happy to take your questions shortly.

    I just want to make one comment about another matter, which is the deeply troubling news about North Korea’s contribution to Russia’s illegal and immoral war in Ukraine. This is a deeply concerning development to see not only Russia continue its illegal and immoral war but to see a state such as North Korea be invited by President Putin, encouraged by President Putin, to join or to support this illegal war. And Australia stands with the remained of the international community not only against Russia’s war but against North Korea’s involvement in what is an illegal and immoral and disruptive war.

    Happy to take questions.

    Journalist: My name is Deidre from TV1, a local reporter. I just wanted to ask, first question is: what kind of support has Australia provided for Samoa for CHOGM, aside from providing assistance in terms of police officers who have come and helped?

    Foreign Minister: Sure, yes, well, obviously that’s the more – most visible recent assistance, which I have to be really clear about is not just Australia. This is a multi-country initiative. It’s obviously contributions from many Pacific Island countries. When we announced the Pacific Policing Initiative at the Pacific Islands Forum I think the Prime Minister and certainly I’ve made the comment, you know, this is Pacific led. And that’s the approach we’ve seen in Samoa. So, it’s good to see these police cooperating on the ground.

    But the behind-the-scenes assistance or contribution obviously was primarily towards the arrangement of CHOGM and supporting – providing support at a diplomatic level. I can – we can talk to you about that in more detail.

    I want to say, though, to you, your country has done an extraordinary job. For a country of this size to be able to host a conference like this, you really all should be very proud. And I’ve no doubt knowing the Pacific and Samoa, this is a whole-of-nation effort, isn’t it? Like everybody steps up. I was talking to Prime Minister Fiamē, and she spoke about everybody stepping forward. And that’s what you see. And your diplomatic influence, your diplomatic standing, is far bigger than your population in terms of the proportion of the world. I see that at the UN when your Prime Minister speaks and your diplomats speak, and I see that in this conference.

    So, my congratulations to my very good friend Prime Minister Fiamē, but also to the people of Samoa for what has been a fantastic CHOGM, and I hope tomorrow goes as well. I’m sure it will.

    Journalist: Foreign Minister, just on the Falepili Union, Feleti Teo has said this morning that he believes that Australia does have a commitment or at least an implied commitment under the text of the Falepili Union to take a hard look at fossil fuel exports, not just Australia’s own internal commitments. What’s your response? Is there any sort of implied commitment in the Falepili Union towards fossil fuel exports? Do you disagree with that analysis?

    Foreign Minister: I think whether it’s the PIF declarations or the public statements we have made, I think we all understand the existential threat that climate change poses to the peoples of the Pacific. I think we all understand the effects of climate change in Australia which we have seen. We’re not a government like Mr Abbott’s and Mr Morrison’s or that has the views Mr Dutton has demonstrated where the science of climate change isn’t accepted, and the experience of Pacific peoples is diminished. Do you remember him saying – talking about making jokes about water lapping at the door?

    So, we understand the extent of this. I’ve spoken at length to the Prime Minister of Tuvalu about the transition in the Australian economy, and it is a very big transition. And I wish we had – you know, when we came to government, we had seen not just 30 per cent renewables but much more because we have to get to in excess of 80 per cent by the end of the decade. But that’s the transition we’re in and we will engage in it.

    On the broader issue of fossil fuel usage, not just in Australia but globally, of course we all have to, we all have to peak our emissions and reduce them, and Australia’s emissions peaked in 2005. We know that there are countries which are still increasing their supply, their coal-fired power stations. Of course, we all know that the whole world has to respond.

    The point I’ve made previously is that there are two emerging economies in the world which, you know, account for 40 per cent of global emissions – India and China. And in order for us to have a chance at restraining global temperature rise, we all have to commit to reducing emissions and to transitioning to cleaner energy. So, we’re up for that. It will take longer than I would have liked because, you know, obviously nothing was done for 10 years.

    Journalist: But can Australia shrug its shoulders in terms of those exports and simply say there is no problem with Australia expanding fossil fuel projects if there’s an appetite for it? The point that I think that Prime Minister Teo is making is that on the one hand Australia points to its own record, on the other hand, you’ve got countries like India and China continuing to expand fossil fuels. He doesn’t perhaps care who takes responsibility; the cycle has to be brought to a close.

    Foreign Minister: Yeah, I think we all have to take responsibility, which is why you also see Australia partnering with other countries to try and work with others to transition the global energy supply to renewable energy. You would have seen I work with Singapore; you’d see that we’re working with Germany. You know, Chris Bowen has spoken at length about the work that he is doing internationally.

    I wish we were – you know, when I was Climate Minister between 2007 and 2010, including the famous Copenhagen conference, I wish that what we were trying to get agreed then had been agreed and you and I would be having a very different conversation. But that isn’t what happened globally. That isn’t what happened in Australia, and we went backwards as a country. We know we have a lot of work to do. And I’ve been upfront with every partner in the Pacific. Of course, I listen, I hear what they say. And I think they also see in us a partner who wants to make this transition. And we will. We will.

    Journalist: Foreign Minister, in terms of Pacific Engagement Visa, I know our government does not want to participate in the first wave. So, my question is: have you received or has the government of Australia received any update from our government? And if the government did not, is Australia – will Australia be pushing for the Samoan government to support the visa?

    Foreign Minister: Yeah, Mr Dziedzic asked me those “if” questions, and I usually tell him off for doing that. But look, as a matter of principle, the Pacific Engagement Visa responds to a longstanding call from Pacific Island nations about wanting a different relationship with Australia. And you would have seen the fact demonstrated by the number of people who have sought to come to Australia in those countries where we have those arrangements. It’s been massive low oversubscribed and, you know, I understand that.

    I’ve also been very clear from the beginning, just like PALM, this is a question for the sending country. If people want it, we will work with whichever country, whichever Pacific Island nation, to set up the arrangements in ways they feel comfortable with. If countries don’t wish to go down this path, it’s not a compulsory path for us.

    We responded. A number of countries have very enthusiastically taken it up. It’s entirely a matter for others whether they choose to or not and, if they do, how they want it to work.

    Journalist: Just to follow up on that, if our government does not want to support it, is Australia willing to reconsider if individuals want to participate?

    Foreign Minister: No, we want this to be something – it’s a government-to-government arrangement for the process of it and the arrangements associated with it, so we wouldn’t want to see that. But, you know, we’re also – we’re not – there’s no deadline for – in the sense that we’re not saying, ‘unless you – you have to do it by this year or never at all.’ It’s a policy that’s in place. I anticipate that countries may work through some of the issues and then may decide that they want to be part of this in time to come. But that’s entirely a matter for them.

    Journalist: Just finally, if I might, Foreign Minister, on the question of Australia’s broader Pacific policy, can you give us a sense, when the Falepili Union was signed the Prime Minister and others made it clear that Australia was looking at if not signing similar agreements, then perhaps integrating more closely with the Pacific. There have been murmurs, obviously, about similar agreements with countries like Nauru and others. Can you give us a sense of where that program is up to and how Australia envisions this?

    Foreign Minister: That’s a good question. And it’s one that the whole country and both parties of government need to be part of. And unfortunately, we’ve not had an opposition that’s been willing, for example, to understand the importance of the Pacific Engagement Visa.

    Your question goes to the – is the right one though – how do you envisage the relationship? And we envisage the relationship as family, as close as we are able to be, recognising the sovereignty of all nations. And we see the benefit in different types of integration with the countries of the Pacific. Now, they’ll not always be the same. So, we have obviously a particular set of arrangements with some countries which are simply PALM or the Pacific Engagement Visa. With Tuvalu, we have a much deeper integration where there is much more that we have put on the table and that Tuvalu has put on the table as well.

    So obviously it will not be the same approach for each country. Countries will make their own decisions. But we see real benefit in responding to Pacific countries’, I suppose, aspirations for the relationship.

    Journalist: What are your expectations for the conference tomorrow? Regarding the continued fighting of the Pacific Islands towards climate change? What are your expectations of the outcome?

    Foreign Minister: Well, I hope that the leader’s communique or statement will be forward leaning on climate. I hope it will be collective in the sense that we recognise – I’ve seen a lot of things over the years – and it really goes to the question Mr Dziedzic asked earlier where we point the finger at each other but actually all of us have to respond on climate, all major economies, in particular. And I hope also that some of the progress that the Pacific has made in relation to sovereignty in the face of sea level rise, which we have backed in, I hope there is progress on that as well in terms of Leaders’ discussion. I know it’s a big step, but I think the Pacific has done a lot of quite innovative international legal work in ensuring that countries can retain sovereignty and retain their, you know, sovereignty over their EEZ, even in the face of sea level rise and that whatever we can do with the Pacific to continue to broaden that out I think is a good thing. And you would have seen that we’ve done that at the PIF and we’ve done that in the Falepili treaty.

    Journalist: One more question please –

    Foreign Minister: Last one.

    Journalist: What are your thoughts on Samoa’s government’s concerns of brain drain for RSE program and also – last one – have you visited one of the villages that is representing Australia in the rural area?

    Foreign Minister: No, no, I haven’t done – I haven’t been out of Apia, I’m afraid, on this visit. Some of the concerns that countries who are considering whether how to handle labour mobility programs, there are a range of concerns. You named one of them. What I have said at the PIF and privately and in meetings is we want these programs to work for you. So, we don’t offer access to the labour market because we are demanding labour; we see this as a partnership and as an economic development opportunity. So, we want the programs to work for you. So, however countries wish to have those programs designed within the limits of the program, we’ve sought to facilitate that. So, that’s how we do it. Okay? Thanks, everybody.

    MIL OSI News –

  • MIL-OSI United Kingdom: PM meeting with Prime Minister Luxon of New Zealand: 24 October 2024

    Source: United Kingdom – Executive Government & Departments

    The Prime Minister met Christopher Luxon, the Prime Minister of New Zealand in Samoa.

    The Prime Minister met Christopher Luxon, the Prime Minister of New Zealand in Samoa.

    The leaders discussed the importance of the Commonwealth, and the opportunities it presented for all its members.

    The Prime Minister said he believed there was a unique moment to harness the potential of the grouping to drive further growth and support smaller members, such as those in the Pacific.

    Turning to the bilateral relationship between the UK and New Zealand, the Prime Ministers reflected on the close people-to-people links and strong trading partnership.  

    Discussing the situation in Ukraine, the Prime Minister thanked Prime Minister Luxon for New Zealand’s strong support for Operation Interflex, which had trained 45,000 Ukrainian troops, and updated him on his discussions with the Quad in Berlin last week.

    On the Middle East, the leaders agreed on the need for de-escalation, regional stability and the increase of humanitarian aid to Gaza.

    The leaders looked forward to speaking again soon.

    Updates to this page

    Published 24 October 2024

    MIL OSI United Kingdom –

  • MIL-OSI United Kingdom: World Polio Day: MHRA trains worldwide laboratories in early detection of polio using breakthrough advanced technology

    Source: United Kingdom – Executive Government & Departments

    Medicines and Healthcare products Regulatory Agency (MHRA) is highlighting our work training multiple World Health Organisation (WHO) polio laboratories around the world.

    Today, World Polio Day, 24 October 2024, the Medicines and Healthcare products Regulatory Agency (MHRA) is highlighting our work training multiple World Health Organisation (WHO) polio laboratories around the world using an advanced molecular direct detection method that can halve detection times – supporting the global effort to eradicate polio and helping save lives.

    In collaboration with Imperial College London, the University of Edinburgh, Biosurv International and funded by the Bill and Melinda Gates Foundation, we have trained 25 countries in just over one year on the use of a technique called Direct Detection by Nanopore Sequencing (DDNS). This method can speed up the detection of polio outbreaks, saving public health authorities crucial time and money. This includes training laboratories in Pakistan, one of the last two countries where polio remains endemic, with the number of cases increasing this year.

    It is vitally important to detect polio early, as the infection moves rapidly within a population. By the time the first signs of polio appear in a country, many hundreds of people are typically already infected and can unknowingly pass on the virus to others who may not be fully vaccinated and protected. The virus – most commonly transmitted through contact with infected faeces via contaminated food and water – multiplies in the intestine, from where it can invade the nervous system and cause paralysis.

    Training worldwide in-country laboratories in rapid detection – using the DDNS method –enables samples to be tested in the country where the outbreak originated, rather than being sent to specialist laboratories abroad. This means the costs and delays of transport and testing can be reduced from an average of 42 days to an average of 19 days – a time saving that saves lives.

    A study published in Nature Microbiology last year, showed that our research, jointly conducted with partners, using the DDNS method to detect polio outbreaks can halve the detection time. This research indicated that DDNS tests done locally, in the Democratic Republic of Congo, over a six-month period were an average of 23 days faster than the standard method, with over 99% accuracy.

    Training laboratories in the DDNS method takes one to two weeks and is carried out by scientists from the MHRA, as well as colleagues from Imperial College London. It involves a combination of theoretical and practical sessions covering all aspects of the DDNS method from sample processing, nucleic acid extraction, PCR amplification, sequencing, analysis and interpretation of results.

    The training also encompasses methodological troubleshooting and utility of the detailed quality assurance programme associated with the method. The University of Edinburgh provides the bioinformatics expertise and have created purpose-designed analytical software to process the sequencing data produced by the method. Biosurv International support supply chains and participate in training and quality control review of data. 

    Javier Martin, Principal Scientist in Virology at the MHRA said:

    This worldwide training in the DDNS method for rapid detection of polio is a key strand in the global fight to eradicate polio, alongside vaccination programmes.

    Carrying out this work with our partners, which is the result of years of research, plays an essential part in managing outbreaks that threaten the global eradication effort and will help make polio a disease of the past.

    We are already initiating collaboration with laboratories in Africa training them to monitor different virus threats, such as Hepatitis E. The potential use of this faster detection technique has almost limitless possibilities for the protection of global health.

    Dr Alex Shaw, Research Fellow in the School of Public Health at Imperial College London talked about the potential that this DDNS method has for use with other diseases:

    The WHO has identified delays in detection as one of the major challenges facing their Polio eradication strategy 2022–2026. Training 25 countries in the past year to detect polio faster allows us to identify where outbreaks are and which polio strain is present much more quickly, allowing us to act at the earliest opportunity.

    This advanced sequencing technology is not only being used to strengthen poliovirus surveillance but is also easily adapted for the detection of other organisms. The worldwide training programme will, therefore, provide a foundation of skills and experience that can be redirected to the genomic surveillance of other pathogens, as needed.

    The most recent laboratory training programme was conducted in Angola and Tanzania and included scientists from Angola, Mozambique, Tanzania, Eritrea, Malawi and Rwanda. We conducted training at the MHRA South Mimms site for European laboratories in June 2024 (Germany, France, Finland, Netherlands, Italy and Ukraine).

    Scientists at the MHRA and their partners will continue to support the testing and validation of DDNS as a polio detection technique and to train WHO laboratories around the world in how to use it. We will travel to Thailand in mid-November 2024 to train scientists from Thailand, India and Indonesia. Additional training activities and implementation visits are planned for 2025 onwards.

    Notes to editors 

    1. The ‘Sensitive poliovirus detection using nested PCR and nanopore sequencing: a prospective validation study’ was published in August 2023 in Nature Microbiology. The research was jointly conducted by researchers at the Institut National de Recherche Biomédicale in Kinshasa who implemented DDNS in the Democratic Republic of the Congo (DRC) for the detection of polio outbreaks in collaboration with the MHRA, Imperial College London, the University of Edinburgh and various laboratories of the World Health Organization (WHO) Global Polio Laboratory Network (GPLN), with support from the Bill and Melinda Gates Foundation.
    2. The Medicines and Healthcare products Regulatory Agency (MHRA) is responsible for regulating all medicines and medical devices in the UK by ensuring they work and are acceptably safe.  All our work is underpinned by robust and fact-based judgements to ensure that the benefits justify any risks. 
    3. The MHRA is an executive agency of the Department of Health and Social Care. 

    For media enquiries, please contact the newscentre@mhra.gov.uk, or call on 020 3080 7651.

    Updates to this page

    Published 24 October 2024

    MIL OSI United Kingdom –

  • MIL-OSI China: BRICS leaders adopt joint declaration

    Source: China State Council Information Office 3

    Leaders of BRICS countries pose for a group photo during the 16th BRICS Summit in Kazan, Russia, Oct. 23, 2024. The summit was hosted by Russian President Vladimir Putin, and attended by Chinese President Xi Jinping, Brazilian President Luiz Inacio Lula da Silva (via video conference), Egyptian President Abdel-Fattah al-Sisi, Ethiopian Prime Minister Abiy Ahmed, Indian Prime Minister Narendra Modi, Iranian President Masoud Pezeshkian, South African President Cyril Ramaphosa and President of the United Arab Emirates (UAE) Sheikh Mohamed bin Zayed Al Nahyan. [Photo/Xinhua]

    BRICS leaders have issued a joint declaration covering a wide range of issues from the reform of the United Nations (UN) to ongoing global conflicts, following the association’s summit that took place on Wednesday in Kazan.

    The declaration included 134 provisions in total, one of which addressed the reform of the UN.

    “We reaffirm our support for a comprehensive reform of the UN, including its Security Council, with a view to making it more democratic, representative, effective and efficient,” the document read. This involves expanding the representation of developing countries to better respond to global challenges.

    In addition, leaders reiterated their absolute condemnation of terrorism in all its forms and called for the prompt adoption of the Comprehensive Convention on International Terrorism within the UN.

    Alongside essential reforms, BRICS members called for the UN to play an important role in the global governance of artificial intelligence.

    The declaration also focused on global conflicts including those in the Middle East and Ukraine.

    “We remain concerned about at the rise of violence and continuing armed conflicts in different parts of the world,” the declaration read. BRICS leaders reaffirmed their commitment to resolving dispute peacefully through diplomacy.

    Leaders expressed deep concern about the ongoing tensions in the Gaza Strip and called for an immediate ceasefire and a cessation of all hostilities.

    The leaders noted the importance of the establishment of a sovereign and independent State of Palestine within the internationally recognized borders of June 1967, and expressed support for Palestine’s full membership in the UN.

    Member states also recalled national positions on the Ukrainian crisis, and “noted with appreciation relevant proposals” aimed at a peaceful settlement of the conflict through diplomacy.

    The BRICS leaders further expressed grave concern over the harmful impact of illegal unilateral sanctions on the global economy, noting that they negatively affect economic growth, energy, food security, and exacerbate poverty.

    BRICS members stressed the need to prevent an arms race in space and called for the creation of a document ensuring space security.

    The provisions included various economic initiatives designed to strengthen the role of developing countries in the global economy and promote equitable conditions for all.

    BRICS members called for the reform of the Bretton Woods institutions to increase the contribution of the developing countries to the global economy.

    They welcomed the establishment of a new BRICS investment platform, which will use the existing institutional infrastructure of the New Development Bank to boost investment flows into BRICS countries and countries of the Global South.

    They called for the reform of the current international financial architecture so it can “meet the global financial challenges” and become more inclusive and just.

    Member countries also supported Russia’s proposal on the creation of a BRICS grain exchange, adding that the trading platform could later be expanded to include other agricultural sectors.

    MIL OSI China News –

  • MIL-OSI Security: Readout of Chairman of the Joint Chiefs of Staff Gen. CQ Brown, Jr.’s Meeting with Canada’s Chief of the Defence Staff Gen. Jennie Carignan

    Source: US Defense Joint Chiefs of Staff

    Office of the Chairman of the Joint Chiefs of Staff Public Affairs

    October 22, 2024

    WASHINGTON, D.C. — Joint Staff Spokesperson Navy Capt. Jereal Dorsey provided the following readout:

    Chairman of the Joint Chiefs of Staff Gen. CQ Brown, Jr., met with Canada’s Chief of the Defence Staff Gen. Jennie Carignan yesterday at the Pentagon.

    Gen. Brown and Gen. Carignan reiterated that the defense of North America remains the No. 1 priority for both militaries. The leaders also discussed opportunities for further coordination.

    Gen. Brown thanked Canada for its commitment to support security interests in the Arctic in partnership with other NATO allies and for its contributions in supporting Ukraine’s fight for freedom. Gen. Brown also commended Canada’s efforts of meeting its defense spending goal of two percent of gross domestic product by 2032.

    Canada is a vital ally and plays a key role in defending North America and upholding the shared values of democracy and the rule of law.

    For more Joint Staff news, visit: www.jcs.mil.
    Connect with the Joint Staff on social media: 
    Facebook, Twitter, Instagram, YouTube,
    LinkedIn and Flickr.

    MIL Security OSI –

  • MIL-OSI Africa: IMF isn’t doing enough to support Africa: billions could be made available through special drawing rights

    Source: The Conversation – Africa – By Kevin P. Gallagher, Professor of Global Development Policy and Director, Global Development Policy Center, Boston University

    At the 2021 UN Climate Summit, Barbados prime minister Mia Mottley called for more and better use of special drawing rights (SDRs), the International Monetary Fund’s reserve asset.

    The special drawing right is an international reserve asset created by the IMF. It is not a currency – its value is based on a basket of five currencies, the biggest chunk of which is the US dollar, followed by the euro. It is a potential claim on the freely usable currencies of IMF members. Special drawing rights can provide a country with liquidity.

    Countries can use their special drawing rights to pay back IMF loans, or they can exchange them for foreign currencies.

    As Mottley is the newest president of the Climate Vulnerable Forum and Vulnerable Group of 20 (V20) finance ministers, which represents 68 climate-vulnerable countries that are among those with the most dire liquidity needs, including 32 African countries, her call would be directly beneficial to African countries.

    In August 2021, as the shock from the COVID-19 pandemic battered their economies, African countries received a lifeline of US$33 billion from special drawing rights. This amounts to more than all the climate finance Africa receives each year, and more than half of all annual official development assistance to Africa.

    This US$33 billion did not add to African countries’ debt burden, it did not come with any conditions, and it did not cost donors a single cent to provide.

    IMF members can vote to create new issuances of special drawing rights. They are then distributed to countries in proportion to their quotas in the IMF. Quotas are denominated in special drawing rights, the IMF’s unit of account.

    Quotas are the building blocks of the IMF’s financial and governance structure. An individual member country’s quota broadly reflects its relative position in the world economy. Thus, by design, the poorest and most vulnerable countries receive the least when it comes to quotas and voting shares.

    Special drawing rights cannot solve all of Africa’s economic challenges. And their highly technical nature means they are not always well understood. But at a time when African countries are facing chronic liquidity challenges – most countries in the region are spending more on debt service payments than they are on health, education, or climate change – our new research shows that special drawing rights can play an important role in establishing financial stability and enabling investments for development.

    Financial stability includes macroeconomic stability (such as low inflation, healthy balance of payments, sufficient foreign reserves), a strong financial system and resilience to shocks.

    African leaders are approaching a critical year-long opportunity: in November, the first Group of 20 (G20) summit will convene (with the African Union in attendance as a member for the first time). Then in December South Africa assumes the G20 presidency.

    Read more: South Africa will be president of the G20 in 2025: two much-needed reforms it should drive

    As African leaders advocate for reforms to the international financial architecture, maximising the potential of special drawing rights should be a central component of their agenda.

    The problem

    African countries’ finances are facing tough times. External debt in sub-Saharan Africa has tripled since 2008. The average government is now spending 12% of its revenue on external debt service. The COVID-19 pandemic, Russia’s war in Ukraine, and rises in interest rates and the prices of commodities, like food and fertiliser, have all contributed to this trend.

    Debt restructuring mechanisms have also proved inadequate. Countries like Zambia and Ghana got stuck in lengthy restructurings. Weak institutional capacity and poor governance also impede efficient use of public resources.

    At the same time, African economies need to increase investment to advance development, support a young and growing population, develop climate resilience and take advantage of the opportunity presented by the energy transition.

    To meet the resources for a just energy transition and the attainment of the UN 2030 Sustainable Development Goals, investment in climate and development will have to increase from around 24% of GDP (the average for Africa in 2022) to 37%.

    Special drawing rights have proved to be an important tool in addressing these challenges. Research by the IMF and others shows that African countries significantly benefited from the special drawing rights they received in 2021 to stabilise their economies. And this happened without worsening debt burdens or costing advanced economies any money, particularly as they cut development aid.

    However, advanced economies exercise significant control over the availability of special drawing rights. The IMF’s quota system determines both voting power and their distribution. Advanced economies control most of the IMF’s quotas.

    The advanced economies made the right decision in 2021 and in 2009 to issue new special drawing rights and the time has come again.

    The solution

    African and other global south leaders need to make a strong case for another issuance of special drawing rights at the IMF and World Bank meetings in Washington.

    In addition to a new issuance of special drawing rights, advanced economies still need to be pressured to re-channel the hundreds of billions of special drawing rights sitting idle on their balance sheets into productive purposes.

    The 2021 allocation of special drawing rights amounted to US$650 billion in total. But only US$33 billion went to African countries due to the IMF’s unequal quota distribution. Meanwhile advanced economies with powerful currencies and no need for special drawing rights received the lion’s share.

    The African Development Bank has spearheaded one such proposal alongside the Inter-American Development Bank. Under this plan, countries with unused special drawing rights could re-channel them to the African Development Bank as hybrid capital, allowing the bank to lend around $4 for each $1 of special drawing rights it receives.

    The IMF approved the use of special drawing rights as hybrid capital for multilateral development banks in May. But it set an excessively low limit of 15 billion special drawing rights across all multilateral development banks.

    Even so, advanced economies have been slow to re-channel special drawing rights. The close to $100 billion that have been re-channelled – mostly to IMF trust funds – is meaningful.

    But it still falls short of what should have been re-channelled.

    In the long term, IMF governance reforms are needed to avoid a repeat of the inefficient distribution of special drawing rights.

    Read more: The World Bank and the IMF need to keep reforming to become fit for purpose

    As African countries rightly push to change shortcomings of the international financial architecture, new special drawing rights issuances should be at the centre of such a strategy. The IMF’s 2021 special drawing rights issuance showed the tool’s scale and importance. And special drawing rights re-channelling has had positive effects in easing debt burdens and freeing up financing to recover from the COVID-19 pandemic.

    With 2030 approaching and the window shrinking for climate action, global leaders should be using all the tools at their disposal, including special drawing rights, to build a more resilient future.

    – IMF isn’t doing enough to support Africa: billions could be made available through special drawing rights
    – https://theconversation.com/imf-isnt-doing-enough-to-support-africa-billions-could-be-made-available-through-special-drawing-rights-241428

    MIL OSI Africa –

  • MIL-OSI Global: IMF isn’t doing enough to support Africa: billions could be made available through special drawing rights

    Source: The Conversation – Africa – By Kevin P. Gallagher, Professor of Global Development Policy and Director, Global Development Policy Center, Boston University

    At the 2021 UN Climate Summit, Barbados prime minister Mia Mottley called for more and better use of special drawing rights (SDRs), the International Monetary Fund’s reserve asset.

    The special drawing right is an international reserve asset created by the IMF. It is not a currency – its value is based on a basket of five currencies, the biggest chunk of which is the US dollar, followed by the euro. It is a potential claim on the freely usable currencies of IMF members. Special drawing rights can provide a country with liquidity.

    Countries can use their special drawing rights to pay back IMF loans, or they can exchange them for foreign currencies.

    As Mottley is the newest president of the Climate Vulnerable Forum and Vulnerable Group of 20 (V20) finance ministers, which represents 68 climate-vulnerable countries that are among those with the most dire liquidity needs, including 32 African countries, her call would be directly beneficial to African countries.

    In August 2021, as the shock from the COVID-19 pandemic battered their economies, African countries received a lifeline of US$33 billion from special drawing rights. This amounts to more than all the climate finance Africa receives each year, and more than half of all annual official development assistance to Africa.

    This US$33 billion did not add to African countries’ debt burden, it did not come with any conditions, and it did not cost donors a single cent to provide.

    IMF members can vote to create new issuances of special drawing rights. They are then distributed to countries in proportion to their quotas in the IMF. Quotas are denominated in special drawing rights, the IMF’s unit of account.

    Quotas are the building blocks of the IMF’s financial and governance structure. An individual member country’s quota broadly reflects its relative position in the world economy. Thus, by design, the poorest and most vulnerable countries receive the least when it comes to quotas and voting shares.

    Special drawing rights cannot solve all of Africa’s economic challenges. And their highly technical nature means they are not always well understood. But at a time when African countries are facing chronic liquidity challenges – most countries in the region are spending more on debt service payments than they are on health, education, or climate change – our new research shows that special drawing rights can play an important role in establishing financial stability and enabling investments for development.

    Financial stability includes macroeconomic stability (such as low inflation, healthy balance of payments, sufficient foreign reserves), a strong financial system and resilience to shocks.

    African leaders are approaching a critical year-long opportunity: in November, the first Group of 20 (G20) summit will convene (with the African Union in attendance as a member for the first time). Then in December South Africa assumes the G20 presidency.



    Read more:
    South Africa will be president of the G20 in 2025: two much-needed reforms it should drive

    As African leaders advocate for reforms to the international financial architecture, maximising the potential of special drawing rights should be a central component of their agenda.

    The problem

    African countries’ finances are facing tough times. External debt in sub-Saharan Africa has tripled since 2008. The average government is now spending 12% of its revenue on external debt service. The COVID-19 pandemic, Russia’s war in Ukraine, and rises in interest rates and the prices of commodities, like food and fertiliser, have all contributed to this trend.

    Debt restructuring mechanisms have also proved inadequate. Countries like Zambia and Ghana got stuck in lengthy restructurings. Weak institutional capacity and poor governance also impede efficient use of public resources.

    At the same time, African economies need to increase investment to advance development, support a young and growing population, develop climate resilience and take advantage of the opportunity presented by the energy transition.

    To meet the resources for a just energy transition and the attainment of the UN 2030 Sustainable Development Goals, investment in climate and development will have to increase from around 24% of GDP (the average for Africa in 2022) to 37%.

    Special drawing rights have proved to be an important tool in addressing these challenges. Research by the IMF and others shows that African countries significantly benefited from the special drawing rights they received in 2021 to stabilise their economies. And this happened without worsening debt burdens or costing advanced economies any money, particularly as they cut development aid.

    However, advanced economies exercise significant control over the availability of special drawing rights. The IMF’s quota system determines both voting power and their distribution. Advanced economies control most of the IMF’s quotas.

    The advanced economies made the right decision in 2021 and in 2009 to issue new special drawing rights and the time has come again.

    The solution

    African and other global south leaders need to make a strong case for another issuance of special drawing rights at the IMF and World Bank meetings in Washington.

    In addition to a new issuance of special drawing rights, advanced economies still need to be pressured to re-channel the hundreds of billions of special drawing rights sitting idle on their balance sheets into productive purposes.

    The 2021 allocation of special drawing rights amounted to US$650 billion in total. But only US$33 billion went to African countries due to the IMF’s unequal quota distribution. Meanwhile advanced economies with powerful currencies and no need for special drawing rights received the lion’s share.

    The African Development Bank has spearheaded one such proposal alongside the Inter-American Development Bank. Under this plan, countries with unused special drawing rights could re-channel them to the African Development Bank as hybrid capital, allowing the bank to lend around $4 for each $1 of special drawing rights it receives.

    The IMF approved the use of special drawing rights as hybrid capital for multilateral development banks in May. But it set an excessively low limit of 15 billion special drawing rights across all multilateral development banks.

    Even so, advanced economies have been slow to re-channel special drawing rights. The close to $100 billion that have been re-channelled – mostly to IMF trust funds – is meaningful.

    But it still falls short of what should have been re-channelled.

    In the long term, IMF governance reforms are needed to avoid a repeat of the inefficient distribution of special drawing rights.



    Read more:
    The World Bank and the IMF need to keep reforming to become fit for purpose

    As African countries rightly push to change shortcomings of the international financial architecture, new special drawing rights issuances should be at the centre of such a strategy. The IMF’s 2021 special drawing rights issuance showed the tool’s scale and importance. And special drawing rights re-channelling has had positive effects in easing debt burdens and freeing up financing to recover from the COVID-19 pandemic.

    With 2030 approaching and the window shrinking for climate action, global leaders should be using all the tools at their disposal, including special drawing rights, to build a more resilient future.

    Abebe Shimeles received funding from African Economic Research Consortium. He is affiliated with Institute of Labor Studies, IZA

    Kevin P. Gallagher does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    – ref. IMF isn’t doing enough to support Africa: billions could be made available through special drawing rights – https://theconversation.com/imf-isnt-doing-enough-to-support-africa-billions-could-be-made-available-through-special-drawing-rights-241428

    MIL OSI – Global Reports –

  • MIL-OSI USA News: On-the-Record Press Call on the G7’s Extraordinary Revenue Acceleration Loans  Effort

    Source: The White House

    Via Teleconference

    9:09 A.M. EDT

    MODERATOR:  Good morning, everyone.  Thanks so much for joining today’s call to discuss the G7’s Extraordinary Revenue Acceleration loans effort for Ukraine. 

    As a reminder, this call is going to be on the record, and it is embargoed until its conclusion. 

    The speaker on today’s call is Daleep Singh, who’s the White House Deputy National Security Advisor for International Economics.  He’ll have a few words at the top, and then we’ll take some of your questions.

    With that, Daleep, I’ll turn it over to you. 

    MR. SINGH:  Thanks, Eduardo.  Thanks, everybody, for joining. 

    Since Russia’s invasion began over two years ago, the United States has rallied the world to defend Ukraine’s freedom, leading a coalition of allies and partners to surge security, economic, and humanitarian assistance, while spearheading unprecedented efforts to impose costs on Russia for its senseless aggression. 

    At the G7 Leaders’ Summit in Apulia this June, the United States proposed an idea to ensure Putin pays for the damage he’s caused in Ukraine by committing we issue $50 billion in loans to Ukraine, backed by the interest earned on the Russian sovereign assets we collectively immobilized just after the invasion began.  We call these Extraordinary Revenue Acceleration loans. 

    Today, we’re announcing that of the $50 billion G7 commitment, the United States plans to provide a loan of $20 billion.  The other $30 billion in loans will come from a combination of our G7 partners, including the European Union, the United Kingdom, Canada, and Japan. 

    To be clear, nothing like this has ever been done before.  Never before has a multilateral coalition frozen the assets of an aggressor country and then harnessed the value of those assets to fund the defense of the aggrieved party, all while respecting the rule of law and maintaining solidarity.  And as a result, Ukraine will receive the assistance it needs now without burdening our taxpayers.

    As we committed in June, the G7 will begin disbursing assistance for the benefit of Ukraine by the end of this year so that we can meet Ukraine’s urgent needs as we approach the winter, while sending an unmistakable signal: The United States and its G7 partners will not fatigue.  We will continue to use our creativity and collaboration to support Ukraine’s fight for independence and sovereignty.  And tyrants are responsible for the damages they cause, not U.S. taxpayers. 

    It’s also a testament to this administration’s belief that multilateralism is a force multiplier.  We couldn’t have done this by ourselves.  The income used to repay these loans will be generated from frozen Russian assets held in the European Union.  This is another example of how Putin’s war of aggression has unified and strengthened the resolve of G7 countries and our partners to defend shared values.  It’s also a model for how we can rally our closest allies towards a shared purpose while ensuring that each country contributes its fair share. 

    Let me give you a few more details, and then I’ll be happy to take your questions. 

    So, the United States will provide at least $10 billion of our loan via economic support.  The World Bank recently established what’s called a financial intermediary fund for Ukraine, which will be the vehicle through which we will disburse U.S. loan proceeds for economic support to Ukraine. 

    The financial intermediary fund, or FIF, will be subject to robust accountability and transparency measures, much like those used for existing U.S. economic assistance to Ukraine. 

    The United States also hopes to provide up to $10 billion

    of our loan as U.S. military support, but our ability to do that relies on Congress taking action before mid-December on certain legislative changes that allow us to make loans for military support under the contours of this broader G7 initiative. 

    To be clear, either way, the U.S. will provide $20 billion in support for Ukraine through this effort, whether it’s split between economic and military support or provided entirely via economic assistance. 

    In terms of next steps, the United States will now work with Ukraine to sign loan agreements in order to execute the loan and begin disbursing funds for the benefit of Ukraine before the end of this year.  More details will be available at the conclusion of the G7 finance ministers meeting later this week or early next.

    Let me stop there and take your questions.

    MODERATOR:  Thanks.  If folks have questions, please use the “raise your hand” function on Zoom and we’ll turn to you. 

    First up, we’ll go to Alan Rappeport.  You should be able to unmute yourself.

    Q    Hi.  Thanks very much, Daleep.  A couple things.  One, can we expect a G7 statement today saying that this is fully done?  Because I know, yesterday, Secretary Yellen said it was 99 percent done. 

    And then, second of all, can you explain how the U.S. has gotten around the need to appropriate any funds to account for the risk associated with the loan?  I know there were concerns about the EU needing to extend its sanctions renewal period, or something like that, to minimize the risk.

    MR. SINGH:  (Inaudible.)  (Audio muted) — from partners, if we had sufficiently strong repayment assurances from the immobilized assets.  And since the Leaders’ Summit, we’ve engaged in intensive diplomacy and technical negotiations every day with our partners to secure the strongest possible repayment assurances. 

    Let me just mention a few.  Number one, the EU Council released a statement at the end of June, and again in October, from all 27 EU heads of state to keep Russia’s central bank assets immobilized until there’s a just peace with a free and sovereign Ukraine and until Russia pays for the damages it’s caused.  This represents an expansion of the G7 leaders’ commitment to the entire EU, including Hungary.

    Number two, equal burden sharing.  So, the EU committed to provide at least $20 billion in loans alongside the United States, which means the Europeans have equal skin in the game and, therefore, fully aligned incentives to keep the assets immobilized until we get fully repaid. 

    Number three, we’ve worked with Ukraine on loan agreements under which, at the conclusion of this war, Ukraine would use settlement proceeds it receives from Russia towards repayment of these loans.

    Number four, we’ve negotiated loan terms with our partners that further reduces any fiscal risks to the U.S. taxpayer. 

    And number five, history.  You know, the EU has had sanctions in place against Russia for almost 10 years now.  Every six months, those sanctions need EU unanimity to get rolled over for another six months.  And, yes, there’s grandstanding and drama, but the EU has built a track record of staying the course, and that adds to our confidence that Russia’s sovereign assets will remain immobilized until Russia ends its war and pays for the damages it’s caused. 

    One last point, Alan.  I’m sorry to belabor this, but it’s a really important question.  While we have found a way to move forward without legal changes to the EU sanctions regime, we will keep pushing for those changes to get made.

    MODERATOR:  Alan, I think we had a little bit of trouble hearing the first part of your question, if you could ask that again.

    Q    Oh, sorry.  Yeah.  I think maybe — or maybe you were muted in the first part of your response.  I was trying to understand if there was going to be a G7 statement today and if this is fully done now.  I know Secretary Yellen said it was 99 percent done yesterday.

    MR. SINGH:  Oh, I’m sorry if you didn’t hear me.  You should expect further statements today, both from the United States and from the G7.

    MODERATOR:  Next up we’ll go to Victoria.  You should be able to unmute yourself.

    Q    Hi.  Thank you.  I just had a couple of questions.  First, I was wondering if you could explain a bit the part you talked in the beginning on the Congress contribution side of things.  What needs to happen from Congress exactly for the $10 billion, the second half, to come through the military aid part?  Is it a matter of using appropriations that have happened already, different appropriations?  If you could just explain that.  And just to clarify that if that doesn’t happen, you could give the other ten through economic support.

    And then, just a second question on the timing of things.  I’m just wondering if you could talk us through how frontloaded you expect this load to be, as in, you know, do you think over the next couple of months we’re going to get a big chunk of it over to Ukraine?  Just the timeline of the disbursements.  Thank you.

    MR. SINGH:  Sure.  So, on the second part of your question, we expect to disburse at least half of our $20 billion loan to the World Bank Trust Fund this December, and possibly the entire amount. 

    And this kind of gets to your first question: We do need authority from Congress to raise the amount of foreign military financing we can provide to Ukraine and also to make certain technical changes that would allow us to split the loan in half between economic assistance and security assistance.  And we’ll be having conversations with Congress between now and December to assess those odds.

    MODERATOR:  Next up, we’ll go to Colby Smith.

    Q    Hi.  Thank you so much.  I just wanted — a couple questions just to follow up on — in terms of assessing the odds.  Did you have, kind of, an initial assessment as it stands today?  And how do you kind of — do you expect that support to come through?

    And then, just more specifically on the economic support side of things, can you just mention a couple of specifics there in terms of how you expect this money to be used?

    MR. SINGH:  Sure.  Thanks, Colby.  So, I just want to be clear: The only question we’re talking about here is the split between economic assistance and security assistance.  We’re going to provide $20 billion either way.

    But, you know, we’ll work with Congress over the next few months to assess whether we can get sufficient authority through foreign military financing loan guarantee authorities to provide half of our assistance through military support. 

    In terms of your question, Colby, on what kinds of projects could the economic assistance support, you know, I would highlight a couple:  Energy assistance.  So, we all know Ukraine is at risk of being plunged into cold and darkness this winter.  Helping to fund the rapid repairs that will be needed to stabilize the grid and also to provide passive protection against drone attacks for substations and transformers.  That’s an urgent priority that we hope this assistance can help meet.

    There are a number of other initiatives that relate to Ukraine’s infrastructure that can create the conditions for an eventual economic recovery that we expect this fund can also support through World Bank project support. 

    And there are many other projects that we can assess, but those are just a couple of examples.

    MODERATOR:  And our last question will go to Daniel.  You should be able to unmute yourself.

    Q    Hi.  How are you doing?  Thank you for taking my question.  I wanted to ask about any potential Russian reprisals.  I know that was a large consideration when you guys were determining the mechanism for these loans.  Are you guys expecting any kind of retaliation?  And do you guys have any preparations for that, whether it be European assets or American?  Thank you very much.

    MR. SINGH:  Well, Russia has been expropriating assets, seizing assets, really, from close to the beginning of its invasion.  So, nothing — nothing new would change on that front if they continue to do so.

    I would just make clear, though, that the revenues that we are using to repay these loans, under European law, these revenues don’t belong to Russia.  It’s actually contractual law. The interest earned doesn’t belong to Russia but rather the custody in Belgium.  And so, we don’t view this as a seizure of Russia’s assets, per se.

    MODERATOR:  Thanks, everyone.  Thanks for joining.  If there are any follow-up questions, do reach out to us, and we’ll get back to you. 

    As a reminder, this call was on the record, and the person you heard from was Daleep Singh, Deputy National Security Advisor for International Economics.  The embargo on this call is now lifted.  Thanks again.

    9:23 A.M. EDT

    MIL OSI USA News –

  • MIL-OSI USA News: A Proclamation on United Nations Day,  2024

    Source: The White House

         Nearly 80 years ago, our forebearers gathered for the first United Nations General Assembly.  With the horrors of World War II weighing on their hearts and the hopes of humanity resting on their shoulders, they opened the General Assembly by declaring, “The whole world now waits upon our decisions… looking to us to show ourselves capable of mastering our problems.”  Today, we reflect on the history of this storied institution.  And together, we recommit to sustaining and strengthening it to master the challenges of our time.

         Under my Administration, the United States has been a leader at the United Nations — rallying global action to advance democratic values, safeguard human rights, and address the issues our world faces.  That includes standing against Russia’s brutal aggression against Ukraine and Hamas’ despicable terrorist attack on Israel.  At the United Nations, we have been working to secure a ceasefire in Gaza, with the release of hostages, and we have been pushing to expand humanitarian access and assistance.  The United States has also played a key role in helping bring security to the people of Haiti and addressing the conflict and dire humanitarian situation in Sudan, where millions are displaced and facing famine.

         But we know people need more than the absence of war.  They need the chance to live with dignity.  They need to be protected from the ravages of climate change, hunger, and disease.  That is why my Administration has invested over $150 billion to accelerate progress on the Sustainable Development Goals, including ending poverty, eliminating hunger, promoting health and well-being, and promoting gender equality.  We also forged a historic consensus on the first-ever General Assembly Resolution on Artificial Intelligence to help people everywhere seize the potential — and minimize the risks — of this technology.

         As we look ahead, countries need to work together to continue reforming the United Nations to be more effective.  The United States will keep pushing for a stronger, more inclusive United Nations, including a reformed and expanded United Nations Security Council.  And the Security Council, like the United Nations itself, needs to focus on making peace, brokering deals to end wars and suffering, stopping the spread of the most dangerous weapons, and stabilizing troubled regions.

         Finally, the United Nations’ work is carried out by brave and committed United Nations humanitarian workers, development professionals, peacekeepers, and members of special political missions.  And every day, they risk their own lives to save the lives of others, undertaking often dangerous work.  Like nations around the world, the United States honors their sacrifices and those of their families.

         Today and every day, let us remember that the forces holding us together are stronger than those pulling us apart.  Let us continue to work together to unleash the power of humanity and give people the opportunity to live freely, think freely, breathe freely, and love freely.  And in the face of difficult challenges, let us prove that we are capable of building a better world together.

         NOW, THEREFORE, I, JOSEPH R. BIDEN JR., President of the United States of America, by virtue of the authority vested in me by the Constitution and the laws of the United States, do hereby proclaim October 24, 2024, as United Nations Day.  I urge the governors of the United States and its territories, and the officials of all other areas under the flag of the United States, to observe United Nations Day with appropriate ceremonies and activities.

         IN WITNESS WHEREOF, I have hereunto set my hand this
    twenty-third day of October, in the year of our Lord two thousand twenty-four, and of the Independence of the United States of America the two hundred and forty-ninth.
     
     
                                   JOSEPH R. BIDEN JR.

    MIL OSI USA News –

  • MIL-OSI USA: Secretary of Defense Lloyd J. Austin III On-Camera, On-the-Record Remarks to Traveling Press in Rome, Italy

    Source: United States Department of Defense

    DEPUTY PRESS SECRETARY SABRINA SINGH:. Thanks, everyone, for joining us for this gaggle. I’m going to let the secretary give some opening remarks and then we’ll start with Rob for questions.

    SECRETARY OF DEFENSE LLOYD AUSTIN: Yeah. Again, thanks for joining us on a pretty long trip, but I think we accomplished a lot. It was the last NATO defense ministerial for the Biden administration. And again, I think that was a really good engagement with a number of our allies. And following that, we had a G7 ministerial and the first-ever G7 ministerial — defense ministerial, and I think that was very, very productive as well.

    You went with us as we went into Kyiv following that. We were able to engage President Zelenskyy and his leadership on a number of important issues. We announced yet another presidential drawdown package. And then finally, today finished up with a visit to the Vatican. So, again, I think it was a good trip overall.

    And I’ll stop there and take your questions.

    MS. SINGH: Rob?

    Q: Mr. Secretary, you just met with the Pope, had an audience with him. Can you share more about what you discussed? And did he talk to you about any of the conflicts in Ukraine or the Middle East?

    SECRETARY AUSTIN: Well, it won’t surprise you that the Pope is very much focused on what’s going on in Ukraine and also in the Middle East as well. He’s concerned about humanitarian issues in both areas. And of course, we share a common desire to see these conflicts, you know, scale back in terms of the level of activity and a ceasefire in both cases.

    Again, I think he’ll continue to exercise his influence to do the right things, and I’ll continue to do what we’re doing on our end to make sure that, number one, Ukraine can defend itself and its sovereignty. And number two, as we’ve said a number of times, we’re going to continue to support Israel and its efforts to defend itself.

    We need to dial down the tension in the Middle East region, and we need to also find a way to transition in Ukraine. Now, as we’ve said all along, we’re going to continue to support Ukraine, and they will determine when the time is to go to the negotiating table. But you’ve heard me say before this conflict will end in some kind of negotiation at some point. Thanks.

    MS. SINGH:  Phil?

    Q: Mr. Secretary, in his nightly video address last night, Ukraine’s President Zelenskyy called on allies not to hide and to respond to evidence of North Korean involvement in Russia’s war in Ukraine. So, I’ll ask you, have you seen any evidence that North Korean troops are in Russia? And if so, what is the intent of this deployment?

    SECRETARY AUSTIN: Well, our analysts are — they continue to look at this, and we are seeing evidence that there are North Korean troops that have gone to Africa. And I wouldn’t — excuse me, not Africa but Russia. What exactly they’re doing will have to be seen. These are things that we need to sort out. We’ll have more for you on that later. But, yeah, as we continue to look at this, there is evidence that there are DPRK troops in Russia.

    MS. SINGH: Eric?

    Q: Just to follow up on that, sir, can you talk a little bit about what you understand the intent of those troops to be? And what does it say about perhaps the desperation of Putin himself to rely on these countries? What role is that? And what is the — what is North Korea getting in return for that? What’s the quid pro quo for that?

    SECRETARY AUSTIN: All of the things that we’re trying to trying to gain better fidelity on, Eric, number one, why are the troops there. We’ll continue to pull this thread and see what happens here. If they’re co-belligerents, if their intention is to participate in this war on Russia’s behalf, that is a very, very serious issue.

    And it will have impacts not only in Europe. It will also impact things in the Indo-Pacific as well. We’ve seen the Republic of Korea be very focused on this issue as well. So, still a lot of things to be answered, Eric. And our analysts will continue to work this, and we’ll have more for you as we get more fidelity.

    Q: And where are the North Koreans’ motivations? Why are they doing this?

    SECRETARY AUSTIN: Yeah, unknown. Certainly, there is a strengthened relationship, for lack of a better term, between Russia and DPRK. You’ve seen the DPRK provide arms and munitions Russia, and this is a next step.

    But what it means in terms of where Putin is, you know, I’ve — heard me talk about the significant casualties in — that he had experienced over the last two and a half years. This is an indication that he may be even in more trouble than most people realize. But, again, he went tin cupping early on to get additional weapons and materials from the DPRK and then from Iran. And now he’s making a move to get more people, if that is the case, if these troops are designed to be a part of the fight in Ukraine. But we’ll see. These are questions that have yet to be answered.

    MS. SINGH: Natasha?

    Q: Thank you, Mr. Secretary. Two quick questions. As you’re likely aware, there is a DOD official being named and accused on social media of leaking highly classified intelligence about Israel. Is that disinformation? Can you rule out that that individual is being investigated, and has the probe homed in on a suspect?

    SECRETARY AUSTIN: There’s no OSD official being named as a part of this investigation. So, that is not true at this point, and I’ve seen no evidence of that or any indication that any OSD official will be implicated as a part of this.

    Q: Ok. And secondly, Israel has claimed that Hezbollah has a major bunker underneath Al-Sahel Hospital in southern Beirut. Doctors who work there have denied the allegation. Has the US seen its own evidence of this bunker underneath that hospital?

    SECRETARY AUSTIN: We’ve not seen evidence of that at this point. But, you know, we’ll continue to collaborate with our Israeli counterparts to gain better fidelity on exactly what they’re looking at.

    Q: Thank you.

    MS. SINGH: Lara?

    Q: Mr. Secretary, I understand you shared with the Ukrainians your DOD spend plan for the next five months for the Ukraine conflict. As you know, five months is after the inauguration of what will be a new administration. So, if Trump gets elected, will you speed up that plan to ensure Ukraine gets all the money that Congress has allocated? And how will you ensure that all of the equipment actually gets delivered, since you know that takes longer?

    SECRETARY AUSTIN: Well, as we commit the funds, Laura, I mean, everything won’t be delivered immediately. So, things that we’re purchasing now, for example, may wind up showing up a couple of months later. And as we laid out the plan on what we’re investing in with both our USAI funds and the drawdown materials that we’re providing, when we can get some of those materials refurbished and into Ukraine, and again, it’s not instantaneous, it may take weeks or in some cases a couple of months. But we laid that plan out for them, and we’re confident that, based upon, you know, what we’ve done and what we are doing that, you know, those things will be delivered on the timeline that we’ve outlined.

    Q: But a new administration could change that and could stop those deliveries.

    SECRETARY AUSTIN: They would have to de-obligate, you know, the things that we’ve already obligated. So, I think we’re pretty sure that these materials will continue to flow.

    Q: Thank you.

    MS. SINGH: Chris?

    Q: Thank you, Mr. Secretary. While you were in Ukraine, President Zelenskyy’s focused on $800 million the US has pledged towards drone production. What is the purpose and goal of that? And is that just for drones, or could Ukraine use that towards ballistic or cruise missiles?

    SECRETARY AUSTIN: Well, we’re going to continue to invest in their long range strike capability. Now, what we’ve seen is that they’ve developed the capability to mass produce drones that are very, very effective and that can go impressive distances. We’ve seen them strike targets that are 400 kilometers beyond the border, and even deeper, with precision. And they can do that at a fraction of a cost of a ballistic missile.

    So, it makes sense to invest in that capability, in their ability to continue to scale. And I think that answers, addresses, the needs that they’ll have not only now but long into the future.

    Q: Would you say that addresses the long range strike question that we keep bugging you about?

    SECRETARY AUSTIN: Well, as we’ve told you so many times, the range of an ATACMS is 300 kilometers. They’re striking targets that are beyond 400 kilometers with precision. So, you know, and they can do that at a fraction of the cost. So, this balances out the the balance sheet here.

    And, you know, if they’re going to be able to sustain their efforts, gotta to be able to afford it. And so, it makes sense for them to expand the capacity. It makes sense for us to invest in what they’re doing. It works. It’s effective and it’s precise.

    Q: Thank you.

    MS. SINGH: And the last one. Missy?

    Q: Yep. Thanks so much. In Lebanon, the targets that Israel is striking in the Beirut area have widened beyond military sites. It’s hitting municipal buildings and health clinics. Last night there were intense strikes on apartment buildings. And now Israel’s issuing the warning, as Natasha mentioned, about this hospital, suggesting that could be a target.

    And then, on the other hand in northern Gaza, you know, the UN is describing the situation there as beyond catastrophic. The UN says the IDF is, you know, continuing its offensive there, denied permission to rescue people from the rubble. Only a handful of trucks are reaching the north each day. And meanwhile, the Netanyahu government, some of the ministers today were having conversations about resettling Gaza and extending the occupation there.

    All of that to say I know you are a strong supporter of Israel’s self-defense, but you’ve also said that how they do it matters. In your view, as someone who has commanded counterinsurgency campaigns extensively, do you think that they’ve gone beyond self-defense on both of these fronts to something that’s more punitive or indiscriminate? And are you worried that Israel’s actions are weakening, not strengthening, its security in the long term?

    SECRETARY AUSTIN: Well, Missy, you’ve heard me say on a number of times that — a couple things. Number one, the ability to accomplish your goals militarily in terms of achieving objectives and protecting humans, protecting civilians in the battle space, those two things are— you can do both of those things. They’re not mutually exclusive.

    And the other thing that I’ve emphasized throughout, Missy, is the need to protect civilians and provide that humanitarian assistance. And this is something I talk to my counterpart about every time I talk to him, those two things. We’ve got to be more precise in our operations, and we have to make sure that we’re doing what’s necessary to get assistance and aid into the civilians.

    Failure to do that will, you know, will create a generation of Palestinians that really will continue to resist cooperating with Israel in the future. So, you’re actually increasing the numbers of insurgents in the space if you fail to do that. It’s a strategic imperative, in my view.

    Q: Ok. But just to clarify, in your view, are — the actions that they’re taking on both strips — fronts, have they gone beyond self-defense actions?

    SECRETARY AUSTIN: Well, you know, it’s one of the things in both cases that makes it more difficult is that both Hamas and LH use civilians as human shields. They put their stores of weapons in apartment buildings, beneath mosques and churches and in schools and hospitals in order to make it more difficult to strike them.

    Because of that complication, you know, that has increased the occurrence of civilian casualties. I think — you know, let’s not kid ourselves. This is a complicated, a very, very difficult battle space. And, you know, so we’re — we need to do everything we can — the Israelis need to do everything they can to be as careful as possible to protect civilians in that battle space. But Hamas and LH make it more complicated.

    MS. SINGH: Thank you all. Appreciate your time. Thank you. Thank you, Mr. Secretary.

    MIL OSI USA News –

  • MIL-OSI USA: Statement from President Joe  Biden on Historic Decision to Leverage Russian Sovereign Assets to Support  Ukraine

    US Senate News:

    Source: The White House
    This summer, I led an effort to bring the G7 together to commit $50 billion in Extraordinary Revenue Acceleration loans to Ukraine backed by the profits of immobilized Russian sovereign assets.  After Russia’s brutal invasion of Ukraine, the G7 took bold action to immobilize Russia’s sovereign assets in our jurisdictions, and committed that these assets will remain immobilized until Russia ends its aggression and pays for the damage it has caused to Ukraine—paving the way for Extraordinary Revenue Acceleration loans.
    As part of the G7 package, the United States is announcing today that we will provide $20 billion in loans to Ukraine that will be paid back by the interest earned from immobilized Russian sovereign assets. In other words, Ukraine can receive the assistance it needs now, without burdening taxpayers. These loans will support the people of Ukraine as they defend and rebuild their country. And our efforts make it clear: tyrants will be responsible for the damages they cause.
    Make no mistake: Russia will not prevail in this conflict. The people of Ukraine will prevail. This is another reminder to Vladimir Putin that the world has rallied behind Ukraine—and the United States and our G7 partners will continue to stand with them every step of the way. 

    MIL OSI USA News –

  • MIL-OSI United Kingdom: Defence Secretary John Healey opening remarks from Trinity House agreement press conference 23 October 2024

    Source: United Kingdom – Executive Government & Departments

    Defence Secretary John Healey delivered opening remarks alongside German defence minister, Boris Pistorius, after signing the Trinity House Agreement

    Location:
    Trinity House, London
    Delivered on:
    (Transcript of the speech, exactly as it was delivered)

    This is a significant day for UK relations and for both our countries. Less than 100 days since I first visited Berlin in July to kick off these negotiations together, we have today signed a landmark defence agreement here at Trinity House in London. First, I want to thank our negotiating teams, they worked at pace, and they have helped us secure a deal which forges closer cooperation between our militaries and our industries, which contains immediate actions and longer term ambitions. Today’s agreement strengthens our security, it will grow our economies.

    And you know, when I was Shadow Defence Secretary before the general election, I had conversations with allies and partners and academics that said Britain needed to play a bigger part in NATO. They said European allies needed to take on more responsibility for European security and this, this is the driving force behind our NATO, first UK Defence strategy, behind our reset of UK relations with Europe. We share the same threats, war in Ukraine, conflict in the Middle East, growing Russian aggression. We share the same values, democracy, individual freedom, rule of law.

    And in a more dangerous world, allies are our strategic strength, and we must do more together. But I believe then, as I know Boris, you did too, that the UK-Germany defence relationship was underdeveloped. The UK and Germany are currently Europe’s top two defence spenders. We’re currently Europe’s top two supporters of Ukraine in military and economic aid. Yes, there’s 40 years of great cooperation on fast jets between UK and Germany. Yes, both countries have deployed and operated together in Kosovo, in Afghanistan, and to counter IS. But the collaboration has been ad hoc. It has not been systematic, and there is no fully-fledged defence cooperation agreement. And as I started work on this area, with some of you in this room, and I thank you for your contributions. As I started work sometime last year, there were only 28 German military personnel training in the UK. There were only six Brits doing the same in Germany, we only had one bilateral German-UK defence industrial programme. So there was huge potential, which we both wanted to seize. The potential and imperative to respond to increasing threats to strengthen our collective security through NATO, which is the cornerstone for the defence of both our nations.

    So today, we have signed this landmark Trinity House Agreement. It secures defence cooperation across all domains, land, sea, air, cyber, space. It will be put on a legal footing in the wider treaty between the UK and Germany. The agreement confirms new lighthouse defence projects between our militaries, and where better to announce these than Trinity house, which is home of England’s official Lighthouse Authority and has been so since 1794. In fact, actually, it goes back longer than that, to Henry the Eighth, when he took the first steps to maritime regulation from this building in 1514. And Admiral Ian Lower, thank you for your hospitality, thank you for hosting us, and thank you to your teams for helping us organise this event.

    But in this new agreement, our new cooperation is focused on the now, with our army’s training, exercising, innovating more together on NATO’s eastern flank, on German P8 planes operating out of Lossiemouth to help protect the North Atlantic and on new support for Ukraine through the capability coalitions, and also enabling German seeking helicopters to be equipped with modern missile systems. So cooperation focused on the now, and also cooperation focused on the weapons of the future: developing a new deep strike system together; pursuing new drones that could operate alongside our tanks; our planes and our warships; kick starting work together to protect vital undersea cables in the North Sea; advancing innovation between our armies to shape the future of NATO warfare; driven by AI and emerging technologies. And as well as this, this agreement paves the way for closer industrial cooperation.

    So today, Rheinmetall have announced plans to build a new gun barrel factory in Britain, supporting 400 jobs, bringing nearly half a billion pounds of benefit to the UK economy, and reestablishing a critical defence industry for the first time in 10 years, gun barrels built in Britain with British steel for our British armed forces and for our allies. And from artillery to AI, from the weapons of now to the weapons of the future, Helsing have also confirmed today a new investment of 350 million pounds into the UK for the development of AI systems. So this shows today’s agreement gives renewed confidence to investors in the UK defence industrial base. Finally, just to give this a bigger context, our new government was elected in July to deliver change. Before with the election, we promised a new defence agreement with Germany in six months, we’ve signed this landmark agreement in less than four months. This is what turning talk into action looks like. This is what resetting relations with Europe looks like. This is what growing our economy looks like, and this is what a NATO first defence strategy looks like. And today’s agreement also sends a signal to our adversaries. We will deter and we will defend against any aggression together.

    Boris, I look forward to working closely with you in putting this agreement into action. Today really is only the start of new, deeper relations between our two nations. And yes, politicians may come and go, but the Trinity house agreement will live on, and it will keep our countries and Europe safely in the years to come. Thank you.

    Updates to this page

    Published 23 October 2024

    MIL OSI United Kingdom –

  • MIL-OSI Canada: Deputy Prime Minister to attend G7 and G20 Finance Ministers’ Meetings and Annual Meetings of the IMF and World Bank

    Source: Government of Canada News

    News release

    October 23, 2024 – Ottawa, Canada – Department of Finance Canada

    This week, from October 23 to 25, the Deputy Prime Minister and Minister of Finance, the Honourable Chrystia Freeland, will attend the Fall Meetings of G7 and G20 Finance Ministers and the Annual Meetings of the International Monetary Fund (IMF) and World Bank in Washington D.C.

    At these meetings, the Deputy Prime Minister will advance work with Canada’s allies to strengthen supply chains with trusted trading partners to create jobs and economic growth that is shared by all Canadians.

    While in Washington, the Deputy Prime Minister will discuss with allies further efforts to support Ukraine through to victory and into reconstruction. Canada was an early champion of G7 efforts to make full use of frozen Russian sovereign assets, and provided a CA$5 billion (US$3.7 billion) contribution to the G7’s CA$68 billion (US$50 billion) Extraordinary Revenue Acceleration Loans for Ukraine. 

    The Deputy Prime Minister will further Canada’s work to build resilient economies and reduce economic inequalities—as demonstrated by the government’s historic investments in early learning and child care, national dental care coverage, and free contraception and diabetes medication. The Deputy Prime Minister will also advance Canada’s work on international tax cooperation.

    An itinerary of events will be released in advance of the meetings.

    Quotes

    “Canada is leading the G7 in cutting interest rates four times this year and reducing inflation to target for all of this year. The wages of Canadian workers have outpaced inflation for 20 months. And, the IMF expects Canada’s economic growth to be the best in the G7 next year. Together, Canada and our allies are working to ensure recent economic gains are not unwound, but rather built upon, so we can create more good-paying jobs, help people get ahead, and build a fairer future for every generation.”

    – The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance

    Quick facts

    • Canada is leading the G7 in:

      • Cutting interest rates; the first to cut rates twice, the first to cut rates a third time, and now the first to cut rates a fourth time;
      • Economic growth expectations, with the IMF predicting that Canada’s GDP will be the fastest growing in 2025;
      • Maintaining the lowest net debt-to-GDP ratio—by a significant margin—in the G7; and,
      • Securing AAA credit ratings from at least two of the world’s three major credit rating agencies, along with only Germany.

    • Inflation has been within the target range of 1 per cent to 3 per cent for all of 2024, with inflation in Canada falling to 1.6 per cent in September—a 43 month low. 

    • Wages in Canada have outpaced inflation for 20 months in a row, which means Canadian workers today on average have larger pay cheques, even accounting for inflation, than they did before the pandemic.

    • The Annual Meetings of the IMF and World Bank, which generally take place in October, have customarily been held in Washington for two consecutive years and in another member country in the third year.

    Contacts

    Media may contact:

    Katherine Cuplinskas
    Deputy Director of Communications
    Office of the Deputy Prime Minister and Minister of Finance
    Katherine.Cuplinskas@fin.gc.ca

    Media Relations
    Department of Finance Canada
    mediare@fin.gc.ca
    613-369-4000

    General enquiries

    Phone: 1-833-712-2292
    TTY: 613-369-3230
    E-mail: financepublic-financepublique@fin.gc.ca

    Stay Connected

    MIL OSI Canada News –

  • MIL-OSI USA: Readout of Secretary of Defense Lloyd J. Austin III’s Meeting With His Holiness Pope Francis at the Vatican

    Source: United States Department of Defense

    Deputy Press Secretary Sabrina Singh provided the following readout:

    Secretary of Defense Lloyd J. Austin III met with His Holiness Pope Francis today at the Vatican. The two leaders discussed shared concerns over global security challenges and the importance of promoting peace and stability in conflict-affected regions. Secretary Austin expressed his deep appreciation for the Vatican’s humanitarian efforts, particularly in addressing the plight of civilians impacted by ongoing conflicts, including the war in Ukraine.

    Secretary Austin and Pope Francis reflected on the need for continued collaboration to alleviate the suffering of those affected by war, persecution, and displacement, while emphasizing the importance of dialogue and reconciliation in resolving global conflicts. Secretary Austin also commended the Pope’s moral leadership and tireless advocacy for the most vulnerable, including his work in promoting peace, supporting refugees, and addressing the effects of climate change on the world’s poorest communities.

    MIL OSI USA News –

  • MIL-OSI Security: Defense News: Secretary Del Toro As-Written Remarks at Future Nuclear-Powered Attack Submarine USS Atlanta (SSN 813) Naming Ceremony

    Source: United States Navy

    Introduction/Thank You

    Good morning, everyone!

    It is an honor to be with you this morning in Atlanta.

    Dr. Evans, thank you for that kind introduction and for the important work you are doing here at the Jimmy Carter Presidential Library and Museum.

    Mayor Dickens, thank you for welcoming us to Atlanta and for your service to the people of this great city.

    Congresswoman Williams, thank you for your presence today, and for your partnership and support of our men and women in uniform.

    Mr. Carter, thank you for sharing your family’s stories and carrying on their legacy of service.

    Mr. McLaurin, thank you for the work you do, preserving and sharing the rich history of the White House.

    I also want to extend a warm welcome to our state and local leadership, including Senator Orrock, Representative Jones, Representative Evans, Representative Miller, Council President Shipman, and Council Member Amos. Thank you for being here with us today.

    Superintendent Stuckey, thank you for your work at the Jimmy Carter National Historical Park.

    President Cabrera, thank you for your leadership of the students of Georgia Tech and your partnership with the Department of the Navy in moving our Navy and Marine Corps’ technological innovations forward.

    Captain Hollenbach, I thank you for all you’ve done as the Virginia-class program manager, ensuring our Navy’s warfighting excellence for years to come.

    To all of our service members, distinguished guests and visitors here with us today—welcome and thank you for joining us.

    World Today

    The world is undeniably complex, and while military power helps advance our national security interests abroad, President Jimmy Carter recognized that diplomacy should always play a leading role in achieving lasting peace.

    Our world today looks to the United States as a beacon of hope and freedom around the world.

    We face challenges in every corner of the world—from the Indo-Pacific, to Europe, and in the Red Sea.

    In Europe, we are approaching the third anniversary of Russia’s full-scale and illegal invasion of Ukraine.

    For the first time since World War II, we face a comprehensive maritime power in the Indo-Pacific.

    The People’s Republic of China continues to exert its excessive maritime claims through their navy, coast guard, and maritime militia.

    In the Red Sea and Gulf of Aden, we have been working tirelessly alongside our NATO allies and Middle Eastern partners to protect innocent civilian mariners and commercial shipping form Iranian-aligned Houthi attacks.

    Following the October 7th attacks in Israel one year ago this month, our Navy and Marine Corps were swiftly deployed to the region, forming an integrated force capable of responding to any threat.

    And earlier this month, two of our highly capable destroyers, the USS Cole (DDG 67)—a warship which carries a legacy of standing tall to acts of terrorism—and the USS Bulkeley (DDG 84)—which will always have a special place in my naval carer as her first Commanding Officer—aided our Israeli allies in shooting down Iranian ballistic missiles. 

    I am incredibly proud of the professionalism, dedication, and resilience shown by our Cole and Bulkeley Sailors.

    These brave young men and women illustrate the consistent excellence and effectiveness expected of our United States Navy.

    And we mourn the loss of two trailblazing, combat-decorated naval aviators from the Eisenhower Carrier Strike Group who passed away during a training event last week: Lieutenant Commander Lyndsay “Miley” Evans and Lieutenant Serena “Dug” Wileman.

    Our thoughts are with their families and friends as they cope with the loss of their loved ones—a loss which serves as a poignant reminder that what we ask of our Sailors and Marines is anything but routine, and in many cases dangerous.

    We honor their service and sacrifice by reaffirming our commitment to the ideals that inspire us to serve.

    City of Atlanta

    The city of Atlanta shares a storied and historic relationship with the United States Navy.

    Since the very founding of our Nation, Atlantans from all walks of life have answered the call to service.

    The Marine Corps’ first aviator, Lieutenant Colonel Alfred Cunningham, was born in Atlanta in 1882 and pioneered early aviation at a time when there were great risks and little appreciation for the danger involved in flying.

    Launched in 1943, Naval Air Station Atlanta trained Navy and Marine Corps squadrons from Reserve Carrier Air Wing 20 and Marine Aircraft Group 42.

    While Naval Air Station Atlanta no longer serves the Navy, the airfield continues to serve as the General Lucius D. Clay National Guard Center.

    Atlanta is, of course, home to the Jimmy Carter Presidential Library and Museum and the Carter Center, named after the former Naval Officer, Senator, Governor, and President, Jimmy Carter.

    As a Naval Officer, Lieutenant Carter helped advance our nuclear submarine program alongside Admiral Hymen Rickover, the “Father of the Nuclear Navy.”

    While in office, President Carter advocated for a more robust Navy—growing our submarine, aviation, and surface forces.

    He also fiercely advocated for the recruitment of Hispanic Americans into the Navy and nominated the first Hispanic American to serve as Secretary of the Navy—Edward Hidalgo.

    As Secretary of the Navy, I had the opportunity to rename a building at the Naval Academy after President Carter last year.

    Carter Hall will be a place of learning for Midshipmen at the Naval Academy for generations to come.

    And the city of Atlanta has had five previous Navy ships named after her legacy.

    The first USS Atlanta served the Union Navy throughout the Civil War after being captured from the Confederate Navy.

    The second USS Atlanta served in the Atlantic Ocean and Gulf of Mexico as a barracks ship.

    The third USS Atlanta (CL 51) served as the lead ship of the Atlanta-class of light cruisers and was laid down at the start of the Second World War.

    Weeks after Japan attacked Pearl Harbor and brought the United States into war, USS Atlanta commissioned at New York Navy Yard and later served as part of Admiral Halsey’s Fleet.

    Light cruiser USS Atlanta (CL 104) served in World War II with Fast Carrier Task Force where she conducted shore bombardment missions.

    The fifth USS Atlanta (SSN 712) commissioned in 1982, completing multiple deployments and fleet readiness exercises during the Cold War before being decommissioned in 1999.

    Ship Naming and Sponsor Announcement

    For 25 years, the Navy has been without a ship named after the proud legacy of the city of Atlanta.

    And so, it is my honor and privilege to name the next Virginia-class submarine, SSN 813, USS Atlanta.

    Our Navy’s submarine force is a lethal combination of one of the most powerful platforms available today manned by our Nation’s best and brightest—people like President Carter.

    The Virginia-class Fast Attack Submarines bring tremendous firepower to our Fleet and provide our commanders a valuable asset which strengthens our national security.

    And wherever she sails, she will represent not only the legacy of the proud ships who bore the name USS Atlanta before her, but also the thousands of Atlantans who have honorably and faithfully served the United States in uniform, as civil servants, and as activists to better our great Nation.

    And I am also proud to announce that the ship sponsor of the future USS Atlanta is former Atlanta Mayor Keisha Lance Bottoms.

    The ship’s sponsor fills a vital role throughout the life of a warship, serving as the bond between the ship, her crew, and the nation they serve.

    I am honored that Mayor Bottoms accepted the invitation to serve as ship sponsor. As a leader and champion for the people of Atlanta, she represents the best of our Nation, and I thank her for her lifelong commitment to our Navy, to our service men and women, and to the United States of America.

    Closing

    Our maritime services are indeed the most powerful and capable force this world has ever seen.

    Before I close my remarks today, I wanted to draw your attention to the portrait on the stage.

    It is Mr. Evan Karanovich’s grandfather’s portrait of USS Atlanta (CL 51), the lead ship of the Atlanta-class of eight light cruisers.

    On November 13th, 1942, the third USS Atlanta sank while escorting ships during the war.

    The portrait hung in his grandfather’s office for years until Mr. Karanovich received it as a commissioning gift.

    And he always wondered why, of all the pictures, he received this one.

    His grandfather said that despite the ship being lost in battle—like Atlanta, our Navy, and our Nation—we are resilient.

    Atlanta’s motto is “Resurgens,” which means “to rise again.”

    What better mantra for us to embrace as we move forward?

    Mr. Karanovich, thank you for sharing this beautiful portrait and story with all of us to enjoy.

    I thank all of you here for your support of our maritime services—you ensure that America remains the greatest nation in the world.

    And now, it is my great pleasure to introduce a leader who was born in this great state.

    She currently serves Georgia’s 5th Congressional District and is a member of several caucuses including the Congressional Black Caucus, Democratic Women’s Caucus, Congressional Progressive Caucus, Voting Rights Caucus, LBGTQ+ Equality Caucus, and the HBCU Caucus.

    Ladies and Gentlemen, please welcome Congresswoman Nikema Williams.

    MIL Security OSI –

  • MIL-OSI Europe: JOINT MOTION FOR A RESOLUTION on the situation in Azerbaijan, violation of human rights and international law and relations with Armenia – RC-B10-0133/2024

    Source: European Parliament

    Rasa Juknevičienė, François‑Xavier Bellamy, Michael Gahler, Andrzej Halicki, David McAllister, Sebastião Bugalho, Nicolás Pascual De La Parte, Isabel Wiseler‑Lima, Daniel Caspary, Loucas Fourlas, Sandra Kalniete, Łukasz Kohut, Andrey Kovatchev, Andrius Kubilius, Miriam Lexmann, Vangelis Meimarakis, Ana Miguel Pedro, Davor Ivo Stier, Michał Szczerba
    on behalf of the PPE Group
    Yannis Maniatis, Nacho Sánchez Amor, Raphaël Glucksmann, Udo Bullmann, Matthias Ecke, Francisco Assis
    on behalf of the S&D Group
    Emmanouil Fragkos, Sebastian Tynkkynen, Assita Kanko, Marion Maréchal, Aurelijus Veryga, Geadis Geadi, Rihards Kols, Bert‑Jan Ruissen, Charlie Weimers
    on behalf of the ECR Group
    Nathalie Loiseau, Petras Auštrevičius, Helmut Brandstätter, Benoit Cassart, Olivier Chastel, Bernard Guetta, Karin Karlsbro, Ľubica Karvašová, Moritz Körner, Veronika Cifrová Ostrihoňová, Marie‑Agnes Strack‑Zimmermann, Hilde Vautmans, Lucia Yar, Dainius Žalimas
    on behalf of the Renew Group
    Sergey Lagodinsky
    on behalf of the Verts/ALE Group

    European Parliament resolution on the situation in Azerbaijan, violation of human rights and international law and relations with Armenia

    (2024/2890(RSP))

    The European Parliament,

    – having regard to its previous resolutions on Azerbaijan, Armenia and the situation in Nagorno-Karabakh,

    – having regard to the relevant documents and international agreements, including but not limited to the United Nations Charter, the Helsinki Final Act and the Alma-Ata Declaration of 21 December 1991,

    – having regard to the European Convention on Human Rights of 1950, ratified by Azerbaijan in 2002 and to the Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment,

    – having regard to the 1954 Hague Convention for the Protection of Cultural Property in the Event of Armed Conflict,

    – having regard to the Partnership and Cooperation Agreement of 22 April 1996 between the European Communities and their Member States, of the one part, and the Republic of Azerbaijan, of the other part[1],

    – having regard to the statements by the European External Action Service spokesperson of 29 May 2024 on the human rights situation in Azerbaijan and of 3 September 2024 on early parliamentary elections in Azerbaijan,

    – having regard to Parliamentary Assembly of the Council of Europe resolution 2527 (2024) of 24 January 2024 entitled ‘Challenge, on substantive grounds, of the still unratified credentials of the parliamentary delegation of Azerbaijan’,

    – having regard to the Statement of Preliminary Findings and Conclusions of the Election Observation Mission to the Early Presidential Elections held on 7 February 2024 and to the Statement of Preliminary Findings and Conclusions of the International Election Observation Mission to the Early Parliamentary Elections in Azerbaijan held on 1 September 2024,

    – having regard to the report of 29 March 2023 by the Council of Europe’s European Commission against Racism and Intolerance on Azerbaijan and to the memorandum of 21 October 2021 by the Council of Europe Commissioner for Human Rights on the humanitarian and human rights consequences following the 2020 outbreak of hostilities between Armenia and Azerbaijan over Nagorno-Karabakh,

    – having regard to the orders of the International Court of Justice of 22 February 2023, of 6 July 2023 and of 17 November 2023 on the request for the indication of provisional measures for the application of the International Convention on the Elimination of All Forms of Racial Discrimination (Armenia v Azerbaijan),

    – having regard to Rules 136(2) and (4) of its Rules of Procedure,

    A. whereas the choice of Azerbaijan’s capital Baku as the venue for the 29th United Nations Climate Change Conference (COP29), scheduled to take place from 11 to 22 November 2024, has sparked controversy, notably owing to Azerbaijan’s worsening human rights record, as well as recent and blatant violations of international law, including aggressive behaviour towards its neighbour Armenia; whereas respect for fundamental human rights and civil society participation are enshrined in the host country agreement through which the Azerbaijani Government committed to uphold these rights; whereas in the lead-up to this major international conference, the Azerbaijani authorities have intensified their repression of civil society organisations, activists, opposition politicians and the remaining independent media through detentions and judicial harassment; whereas corruption and a lack of judicial independence further undermine governance;

    B. whereas civil society organisations list over 300 political prisoners in Azerbaijan, including Gubad Ibadoghlu, Anar Mammadli, Bakhtiyar Hajiyev, Tofig Yagublu, Ilhamiz Guliyev, Aziz Orujov, Bahruz Samadov, Akif Gurbanov and many others; whereas there are credible reports of violations of prisoners’ human rights, including detention in inhumane conditions, torture and refusal of adequate medical care;

    C. whereas prominent human rights defender and climate advocate, Anar Mammadli, has been in pre-trial detention since 30 April 2024 on bogus charges of conspiracy to bring illegal foreign currency into the country and his health has deteriorated significantly while in custody; whereas Gubad Ibadoghlu, a political economist, opposition figure and one of the finalists for the 2024 Sakharov Prize for Freedom of Thought, was arrested by Azerbaijani authorities in July 2023 and remained in detention until 22 April 2024, when he was transferred to house arrest; whereas his health has deteriorated significantly since his arrest, as a result of torture, inhumane detention conditions and refusal of adequate medical care, thus endangering his life; whereas the health of Gubad Ibadoghlu’s wife, Irada Bayramova, continues to deteriorate as a result of the physical violence she suffered during her detention by the Azerbaijani authorities; whereas on 4 December 2023 human rights activist Ilhamiz Guliyev was arrested on politically motivated charges a few months after he gave an anonymous interview to Abzas Media about the alleged police practice of planting drugs on political activists;

    D. whereas for more than a decade and with increasing determination, Azerbaijani authorities have been reducing space for civil society, arbitrarily closing down non-governmental organisations (NGOs) and arresting or forcing into exile civil society representatives; whereas in recent years, the Azerbaijani authorities have imposed increasingly stringent restrictions on civil society organisations; whereas activists, journalists, political opponents and others have been imprisoned on fabricated and politically motivated charges;

    E. whereas according to human rights defenders, crackdowns on civil society have occurred around other major international events hosted by Azerbaijan, including Eurovision 2012 and the European Games 2015;

    F. whereas the Azerbaijani regime appears to extend its repressive actions beyond its borders; whereas the ongoing crackdown on freedom of expression in Azerbaijan is also reflected in reports of transnational repression and reprisals against family members of detainees; whereas, since 2020, Mahammad Mirzali, an Azerbaijani dissident blogger, has been the target of several assassination attempts in France; whereas, on 29 September 2024, Vidadi Isgandarli, a critic of the Azerbaijani regime living as a political refugee in France, was attacked in his home and succumbed to his injuries two days later; whereas the Azerbaijani authorities have also engaged in politically motivated prosecutions of EU citizens, as seen in the case of Théo Clerc, prompting at least one Member State to formally warn its citizens against travelling to Azerbaijan owing to the risk of arbitrary detention;

    G. whereas Azerbaijan has implemented a systematic policy of bribing officials and elected representatives in Europe in order to downplay Azerbaijan’s human rights record and to silence critics, as part of a widely used strategy described as ‘caviar diplomacy’; whereas some cases have been investigated and some of those involved have been prosecuted and convicted by national courts in several EU Member States;

    H. whereas a number of European Court of Human Rights decisions have found that Azerbaijan has violated human rights; whereas according to the Parliamentary Assembly of the Council of Europe, more than 320 court judgments against Azerbaijan have not yet been executed or have been only partially implemented, which is the highest number among all state parties to the European Convention on Human Rights;

    I. whereas on 3 July 2024, the Council of Europe’s European Committee for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment (CPT) publicly denounced Azerbaijan’s ‘refusal to improve the situation in the light of the Committee’s recommendations’ and the ‘persistent lack of cooperation of the Azerbaijani authorities with the CPT’;

    J. whereas the PACE decided in January 2024 not to ratify the credentials of the Azerbaijani delegation, noting its ‘very serious concerns as to …[Azerbaijan’s] respect for human rights’; whereas the Parliamentary Assembly of the Council of Europe noted that its Monitoring Committee’s rapporteurs were not allowed to meet with people who had been detained on allegedly politically motivated charges, and that the Azerbaijani delegation refused to allow the rapporteur for the Committee on Legal Affairs and Human Rights to visit the country;

    K. whereas according to the Election Observation Mission led by the Organization for Security and Co-operation in Europe’s Office for Democratic Institutions and Human Rights (OSCE/ODIHR), the early presidential election held on 7 February 2024 took place in a restrictive environment and was marked by the stifling of critical voices and the absence of political alternatives; whereas Azerbaijan held early parliamentary elections on 1 September 2024 in what the OSCE/ODIHR-led International Election Observation Mission described as a restrictive political and legal environment that did not enable genuine pluralism and resulted in a contest devoid of competition; whereas in the period leading up to the parliamentary elections, several government critics were detained;

    L. whereas media legislation in Azerbaijan has become increasingly repressive, with the February 2022 media law effectively legalising censorship; whereas several other laws affecting the media also violate the country’s international obligations with regard to freedom of expression and press freedom; whereas public criticism of the authorities is subject to severe penalties;

    M. whereas according to Reporters Without Borders, virtually the entire media sector in Azerbaijan is under official control, with no independent television or radio broadcasts from within the country, and all critical print newspapers shut down; whereas the authorities continue to suppress the last remaining independent media and repress journalists who reject self-censorship; whereas Azerbaijan has intensified its repression against the remaining independent media, such as Abzas Media, Kanal 13 and Toplum TV, through detentions and judicial harassment;

    N. whereas the Azerbaijani laws regulating the registration, operation and funding of NGOs are highly restrictive and arbitrarily implemented, thus effectively criminalising unregistered NGO activity; whereas Freedom House’s 2024 index ranks Azerbaijan among the least free countries in the world, below Russia and Belarus;

    O. whereas gas contracts between Gazprom and SOCAR for the delivery of one billion cubic metres of gas from Russia to Azerbaijan between November 2022 and March 2023 have raised significant concerns about the re-export of Russian gas to the European market, particularly in the context of the signed memorandum of understanding on the strategic partnership in the field of energy; whereas the EU aims to reduce European dependence on Russian gas, but this agreement could be seen as undermining that goal, as Russian gas would still be flowing into Azerbaijan, thus potentially freeing up Azerbaijani gas for increased re-export to the EU; whereas there are also worrying reports of Russian gas being rebranded as Azerbaijani for sale in the EU;

    P. whereas Azerbaijani leaders have engaged in anti-EU and anti-Western rhetoric; whereas Azerbaijan has intensified its disinformation campaigns targeting the EU and its Member States, with a specific focus on France; whereas Azerbaijan has actively interfered in European politics under the guise of ‘anti-colonialism’, notably in overseas countries and territories such as New Caledonia;

    Q. whereas in addition, in September 2023, after months of the illegal blockade of Nagorno-Karabakh, Azerbaijan launched a pre-planned, unjustified military attack on the territory, forcing over 100 000 ethnic Armenians to flee to Armenia, which amounts to ethnic cleansing; whereas as a result, Nagorno-Karabakh has been almost entirely emptied of its Armenian population, who had been living there for centuries; whereas this attack represents a gross violation of human rights and international law, a clear breach of the trilateral ceasefire statement of 9 November 2020 and a failure to uphold commitments made during EU-mediated negotiations;

    R. whereas the Armenians of Nagorno-Karabakh lost their property and belongings while fleeing the Azerbaijani military push in 2023 and have been unable to recover them since; whereas actions amounting to ethnic cleansing have continued since then; whereas the EU has provided humanitarian aid to people displaced from Nagorno-Karabakh; whereas credible reports confirm the organised destruction of Armenian cultural and religious heritage in Nagorno-Karabakh; whereas Azerbaijani leaders and officials repeatedly use hate speech against Armenians;

    S. whereas both Azerbaijan and Armenia are bound by international humanitarian law and the Third Geneva Convention protects prisoners of war from all forms of torture and cruel treatment; whereas reports indicate that 23 Armenian prisoners are currently being held in Azerbaijani prisons without adequate legal representation, including eight former leaders of Nagorno-Karabakh, some of whom have received long prison sentences;

    T. whereas in February 2023, the EU deployed the European Union Mission in Armenia (EUMA) to observe developments at the international border with Azerbaijan; whereas Azerbaijan has refused to cooperate with EUMA and the mission has been the target of disinformation by Azerbaijani authorities and government-controlled media; whereas the Azerbaijani leadership continues to make irredentist statements with reference to the sovereign territory of Armenia; whereas the Azerbaijani army continues to occupy no less than 170 km2 of the sovereign territory of Armenia;

    U. whereas Armenia and Azerbaijan have engaged in negotiations on a peace treaty, the normalisation of their relations and border delimitation, both before and after the 2023 attack on Nagorno-Karabakh; whereas, despite mediation efforts by the EU and others, no peace agreement has been signed between Azerbaijan and Armenia; whereas, although both governments have stated that they are close to an agreement, recent remarks by the Azerbaijani president raise concern about Baku’s willingness to find a compromise to conclude the negotiations;

    V. whereas the EU fully supports the sovereignty and territorial integrity of both Azerbaijan and Armenia and actively supports efforts towards a sustainable peace agreement between the two countries, achieved by peaceful means and respecting the rights of the population concerned;

    W. whereas since Russia’s war of aggression against Ukraine, Azerbaijan has deepened its relations with Russia, including political and economic ties, as well as increased cooperation between their intelligence services; whereas Russia has openly backed Azerbaijan in its aggressive behaviour towards Armenia;

    1. Strongly condemns the domestic and extraterritorial repression by the Azerbaijani regime against activists, journalists, opposition leaders and others, including EU nationals, which has noticeably intensified ahead of COP29; urges the Azerbaijani authorities to release all persons arbitrarily detained or imprisoned on account of their political views, to drop all politically motivated charges and to cease all forms of repression, both within and beyond Azerbaijan; recalls in this context the names of Tofig Yagublu, Akif Gurbanov, Bakhtiyar Hajiyev, human rights defenders and journalists, including Ulvi Hasanli, Sevinj Vagifgizi, Nargiz Absalamova, Hafiz Babali and Elnara Gasimova, Aziz Orujov, Rufat Muradli, Avaz Zeynalli, Elnur Shukurov, Alasgar Mammadli, Ilhamiz Guliyev and Farid Ismayilov, as well as of civil society activists arrested after March 2024 such as Anar Mammadli, Farid Mehralizade, Igbal Abilov, Bahruz Samadov, Emin Ibrahimov and Famil Khalilov; expresses deep concern about the environment of fear that this has created inside the country, leaving civil society effectively silenced;

    2. Reiterates its call for the Azerbaijani authorities to drop all charges against Dr Gubad Ibadoghlu and allow him to travel abroad, unhindered and to the country of his choice, to reunite with his family, to receive the medical care he urgently needs and attend the Sakharov Prize ceremony in Strasbourg in December 2024; calls on Azerbaijan to ensure that he receives an independent medical examination by a doctor of his own choosing and to allow him to receive treatment abroad; calls on all EU representatives and individual Member States to actively support the release from house arrest of Dr Gubad Ibadoghlu and insist on his release in every exchange with the Azerbaijani authorities;

    3. Demands that freedom of the press and expression be guaranteed and that media organisations not be restricted; calls, therefore, on the Azerbaijani Government to release journalists working for Abzas Media and Toplum TV, including Ulvi Hasanli, Sevinj Vagifqizi and Alasgar Mammadli;

    4. Considers that Azerbaijan’s ongoing human rights abuses are incompatible with its hosting of COP29; urges EU leaders, in particular Commission President Ursula von der Leyen, to use COP29 as an opportunity to remind Azerbaijan of its international obligations and to meaningfully address the country’s human rights record in their interactions with the Azerbaijani authorities, including by calling for the unconditional release of all persons arbitrarily detained or imprisoned on account of their political views and by requesting to meet with political prisoners while in the country; calls for the EU and its Member States to do their utmost to ensure that United Nations Climate Change conferences are not hosted in countries with poor human rights records;

    5. Reminds the Azerbaijani authorities of their obligations to respect fundamental freedoms, and calls on them to repeal repressive legislation that drives independent NGOs and media to the margins of the law; calls on the Azerbaijani authorities to repeal repressive legislation on the registration and funding of NGOs to bring them into line with Venice Commission recommendations;

    6. Recalls that the 1996 EU-Azerbaijan Partnership and Cooperation Agreement, which is the legal basis for bilateral relations, is based on respect for democracy and the principles of international law and human rights and that these have been systematically violated in Azerbaijan;

    7. Reminds the Azerbaijani Government of its international obligations to safeguard the dignity and rights of detainees, ensuring that they receive adequate medical care, are detained in humane conditions and are protected from any mistreatment; calls on the Azerbaijani Government to swiftly comply with long-standing recommendations of the Council of Europe’s European Committee for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment on the subject of the widespread recourse to physical ill treatment – including, on occasion, torture – by the police in Azerbaijan; calls on the Azerbaijani Government to implement all the decisions of the European Court of Human Rights;

    8. Reiterates its call for EU sanctions to be imposed under the EU Global Human Rights Sanctions Regime on Azerbaijani officials who have committed serious human rights violations; calls on the EU Special Representative for Human Rights to request meetings with political prisoners in Azerbaijan;

    9. Insists that any future partnership agreement between the EU and Azerbaijan be made conditional on the release of all political prisoners, the implementation of legal reforms and the overall improvement of the human rights situation in the country, as well as on Azerbaijan demonstrating its genuine readiness to faithfully engage in the negotiation of a peace agreement with Armenia and to respect the rights of Nagorno-Karabakh Armenians;

    10. Calls for the EU to end its reliance on gas exports from Azerbaijan; calls on the Commission to suspend the 2022 memorandum of understanding on the strategic partnership in the field of energy and to act accordingly;

    11. Reaffirms its support for the sovereignty and territorial integrity of both Azerbaijan and Armenia and strongly supports the normalisation of their relations based on the principles of the mutual recognition of territorial integrity and the inviolability of borders, in accordance with the 1991 Alma-Ata Declaration; reiterates its demand for the withdrawal of Azerbaijan’s troops from the entirety of Armenia’s sovereign territory; calls on Azerbaijan to unequivocally commit to respecting Armenia’s territorial integrity; highlights that Azerbaijan’s connectivity issues with its exclave of Nakhchivan should be resolved with full respect for the sovereignty and territorial integrity of Armenia; reiterates its position that the EU should be ready to impose sanctions on any individuals and entities that threaten the sovereignty, independence and territorial integrity of Armenia;

    12. Condemns any military aggression, use of force or hybrid threats against Armenia, as well as foreign interference and attempts to destabilise the political situation in Armenia; welcomes, furthermore, the decision to adopt the first assistance measure under the European Peace Facility in support of Armenian armed forces and calls for the cooperation between Armenia and the EU to be further reinforced in the field of security and defence; welcomes the actions undertaken by several Member States to provide defensive military support to Armenia and urges the Member States to consider similar initiatives; welcomes the new momentum in bilateral relations between the EU and Armenia, which is strongly supported by the authorities in Yerevan; calls on the Commission and the Council to actively support Armenia’s desire for increased cooperation with the EU;

    13. Expresses its support for the activities of the European Union Mission in Armenia (EUMA) and underscores the important role it plays; reiterates its concern regarding the repeated smear campaigns originating from Azerbaijan against EUMA; calls on EUMA to continue to closely monitor the evolving security situation on the ground, provide transparent reporting to Parliament and actively contribute to conflict resolution efforts; calls for the EU and its Member States to strengthen EUMA’s mandate, increase its size and extend its duration;

    14. Supports all initiatives and activities that could lead to the establishment of peace between Armenia and Azerbaijan and the signing of a long-awaited peace agreement; calls on Azerbaijan to demonstrate genuine efforts to this end; warns Azerbaijan that any military action against Armenia would be unacceptable and would have serious consequences for the partnership between Azerbaijan and the EU; welcomes the Armenia-Azerbaijan joint statement of 7 December 2023 on confidence-building measures; welcomes the progress made in the framework of the Armenia-Azerbaijan border delimitation process, which has led to an agreement on several sections of the border; encourages both sides to take further steps on the remaining sections; calls for the EU to cease all technical and financial assistance to Azerbaijan that might contribute to strengthening its military or security capabilities; calls on the Member States to freeze exports of all military and security equipment to Azerbaijan;

    15. Calls for the full implementation of all orders issued by the International Court of Justice, including the order of 17 November 2023 indicating provisional measures regarding the safe, unimpeded and expeditious return of people who fled Nagorno-Karabakh; recalls that the decision to host COP29 in Baku was made after Azerbaijan failed to comply with the above-mentioned International Court of Justice order as well as those of 7 December 2021 and of 22 February 2023; reiterates its call for independent investigations into the abuses committed by Azerbaijani forces in Nagorno-Karabakh; reiterates its call on the Azerbaijani authorities to allow the safe return of the Armenian population to Nagorno-Karabakh, to genuinely engage in a comprehensive and transparent dialogue with them, to provide robust guarantees for the protection of their rights, including their land and property rights, the protection of their distinct identity and their civic, cultural, social and religious rights, and to refrain from any inflammatory rhetoric that could incite discrimination against Armenians; urges the Azerbaijani authorities to release all 23 Armenian prisoners of war detained following Azerbaijan’s retaking of the Nagorno-Karabakh region;

    16. Reiterates its call for the EU institutions and the Member States to continue to offer assistance to Armenia to deal with the refugees from Nagorno-Karabakh; calls for the EU, in this regard, to provide a new package of assistance to Armenia to help the Armenian Government address the humanitarian needs of refugees; welcomes all efforts by the Government of Armenia to provide shelter and aid to the displaced Armenians;

    17. Expresses deep concern regarding the preservation of cultural, religious and historical heritage in Nagorno-Karabakh following the massive exodus of its Armenian population; urges Azerbaijan to refrain from further destruction, neglect or alteration of the origins of cultural, religious or historical heritage in the region and calls on it instead to strive to preserve, protect and promote this rich diversity; demands the protection of the Armenian cultural, historical and religious heritage in Nagorno-Karabakh in line with UNESCO standards and Azerbaijan’s international commitments; insists that Azerbaijan allow a UNESCO mission to Nagorno-Karabakh and grant it the necessary access;

    18. Deplores steps taken by Azerbaijan towards the secessionist entity in occupied Cyprus, which are against international law and the provisions of UN Security Council Resolutions 541 (1983) and 550 (1984); calls on Azerbaijan to respect the principles of sovereignty and territorial integrity of states and to not invite the secessionist entity in occupied Cyprus to any meetings of the Organization of Turkic States;

    19. Condemns Azerbaijan’s repeated attempts to denigrate and destabilise Member States, including through the so-called Baku Initiative Group; condemns in particular its support for irredentist groups and disinformation operations targeting France, especially in the French departments and territories of New Caledonia, Martinique and Corsica; recalls that these methods were used against Germany in 2013; denounces the smear campaigns targeting Denmark; regrets the smear campaign aimed at damaging France’s reputation by calling into question its capacity to host the 2024 Olympic Games, launched by actors suspected of being close to the Azerbaijani regime;

    20. Condemns the arbitrary arrests of EU citizens based on spurious accusations of espionage and their disproportionate sentencing;

    21. Strongly condemns the public insults and direct threats made by Azerbaijani diplomatic or government representatives, or members of the Azerbaijani Parliament, targeting elected officials of EU Member States; demands, in this regard, that access to EU institutional buildings be denied to the Azerbaijani officials concerned until further notice;

    22. Instructs its President to forward this resolution to the Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the President, Government and Parliament of the Republic of Azerbaijan, the President, Government and Parliament of the Republic of Armenia, the Director-General of UNESCO, the Organization for Security and Co-operation in Europe, the United Nations and the Council of Europe.

    MIL OSI Europe News –

  • MIL-OSI Europe: JOINT MOTION FOR A RESOLUTION on the misinterpretation of UN resolution 2758 by the People’s Republic of China and its continuous military provocations around Taiwan – RC-B10-0134/2024

    Source: European Parliament

    Michael Gahler, Miriam Lexmann, Sebastião Bugalho, Rasa Juknevičienė, Danuše Nerudová
    on behalf of the PPE Group
    Yannis Maniatis, Kathleen Van Brempt, Tonino Picula
    on behalf of the S&D Group
    Joachim Stanisław Brudziński, Adam Bielan, Mariusz Kamiński, Charlie Weimers, Michał Dworczyk, Alexandr Vondra, Veronika Vrecionová, Ondřej Krutílek, Rihards Kols, Maciej Wąsik, Sebastian Tynkkynen, Alberico Gambino, Bert‑Jan Ruissen, Carlo Fidanza
    on behalf of the ECR Group
    Engin Eroglu, Petras Auštrevičius, Helmut Brandstätter, Dan Barna, Veronika Cifrová Ostrihoňová, João Cotrim De Figueiredo, Bernard Guetta, Svenja Hahn, Ľubica Karvašová, Karin Karlsbro, Moritz Körner, Nathalie Loiseau, Jan‑Christoph Oetjen, Ana Vasconcelos, Dainius Žalimas
    on behalf of the Renew Group
    Markéta Gregorová
    on behalf of the Verts/ALE Group

    European Parliament resolution on the misinterpretation of UN resolution 2758 by the People’s Republic of China and its continuous military provocations around Taiwan

    (2024/2891(RSP))

    The European Parliament,

    – having regard to its previous resolutions on the People’s Republic of China (PRC) and Taiwan,

    – having regard to its resolution of 16 September 2021 on a new EU-China strategy[1],

    – having regard to its recommendation of 21 October 2021 to the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy on EU-Taiwan political relations and cooperation[2],

    – having regard to its resolution of 7 June 2022 on the EU and the security challenges in the Indo-Pacific[3],

    – having regard to its resolution of 15 September 2022 on the situation in the Strait of Taiwan[4],

    – having regard to its resolution of 13 December 2023 on EU-Taiwan trade and investment relations[5],

    – having regard to the Strategic Compass for Security and Defence, approved by the Council on 21 March 2022,

    – having regard to the joint communication from the Commission and the High Representative of the Union for Foreign Affairs and Security Policy of 16 September 2021 entitled ‘The EU strategy for cooperation in the Indo-Pacific’ (JOIN(2021)0024),

    – having regard to the EU’s ‘One China’ policy,

    – having regard to the EU-China summit of 7 December 2023,

    – having regard to the European Council conclusions on China of 30 June 2023,

    – having regard to the visits of the Committee on Foreign Affairs of 25 to 27 July 2023 and of the Committee on International Trade of 19 to 21 December 2022 to Taiwan,

    – having regard to the statement of 1 September 2024 by the Spokesperson of the High Representative of the Union for Foreign Affairs and Security Policy on the latest dangerous actions in the South China Sea,

    – having regard to the statements by the Spokesperson of the High Representative of the Union for Foreign Affairs and Security Policy on China’s military drills around Taiwan, including the most recent statement of 14 October 2024,

    – having regard to the G7 Foreign Ministers’ statements of 18 April 2023 and of 3 August 2022 on preserving peace and stability across the Taiwan Strait,

    – having regard to the statement by the Chair of the G7 Foreign Ministers’ Meeting of 23 September 2024,

    – having regard to the joint declaration by the G7 Defence Ministers of 19 October 2024,

    – having regard to the urgency motion on Taiwan passed by the Australian Senate on 21 August 2024,

    – having regard to UN General Assembly Resolution 2758 (XXVI) of 25 October 1971,

    – having regard to the motion on UN Resolution 2758 passed by the Dutch House of Representatives on 12 September 2024,

    – having regard to the press statement by the US Department of State of 13 October 2024,

    – having regard to the UN Convention on the Law of the Sea (UNCLOS),

    – having regard to Article 7 of the UN Framework Convention on Climate Change (UNFCCC), concluded on 9 May 1992,

    – having regard to Rule 5 of the Standing Rules of Procedure of the Assembly of the International Civil Aviation Organization (ICAO),

    – having regard to Article 4 of the Constitution of the International Criminal Police Organization (Interpol),

    – having regard to Article 8 and Article 18(h) of the Constitution of the World Health Organization (WHO),

    – having regard to Rules 136(2) and (4) of its Rules of Procedure,

    A. whereas UN Resolution 2758 was passed by the UN General Assembly on 25 October 1971 and shifted the official recognition from the Republic of China (Taiwan) to the People’s Republic of China (PRC); whereas today Taiwan, while not being a member of the United Nations, maintains diplomatic relations with 11 of the 193 United Nations member states, as well as with the Holy See;

    B. whereas the EU and Taiwan are like-minded partners that share the common values of freedom, democracy, human rights and the rule of law; whereas Taiwan is a vibrant democracy, with a flourishing civil society; whereas Taiwan held peaceful and well-organised elections on 13 January 2024;

    C. whereas following the adoption of UN Resolution 2758, Taiwan lost its access to participation in multilateral forums, such as the WHO;

    D. whereas Taiwan has never been part of the PRC; whereas the Republic of China was established in 1912 and the PRC in 1949;

    E. whereas UN Resolution 2758 addresses the status of the PRC, but does not determine that the PRC enjoys sovereignty over Taiwan, nor does it make any judgement on the future inclusion of Taiwan in the UN or any other international organisation; whereas, however, the PRC continues to misinterpret UN Resolution 2758 to block Taiwan’s meaningful participation in international organisations and unilaterally change the status quo; whereas these actions highlight the PRC’s ambition to alter the existing multilateral international order and undermine international law, and can be seen as an expression of systemic rivalry;

    F. whereas the EU continues to maintain its own ‘One China’ policy, which is different from the PRC’s ‘One China’ principle; whereas the EU’s long-standing position has been to support the status quo and a peaceful resolution of differences across the Taiwan Strait, while encouraging dialogue and constructive engagement;

    G. whereas through their statement of 23 September 2024 the G7 members, among other things, underlined their support for ‘Taiwan’s meaningful participation in international organizations as a member where statehood is not a prerequisite and as an observer or guest where it is’;

    H. whereas supporting Taiwan’s participation in international organisations does not undermine the EU’s commitment to its ‘One China’ policy, which remains the political foundation of EU-China relations;

    I. whereas over the past decade the PRC has persistently tried to increase its influence over international institutions, using this to sideline Taiwan and prevent Taiwanese passport holders, including journalists, non-governmental organisation workers and political activists, from accessing international institutions; whereas the PRC exercises transnational repression by misusing extradition treaties to target Taiwanese people abroad and therefore put them at risk of arbitrary persecution and human rights abuses;

    J. whereas the statutes of most international organisations tasked to address global issues, including the WHO, the UNFCCC, Interpol and the ICAO, provide opportunities for entities such as Taiwan to participate without infringing on the rights of member states;

    K. whereas Taiwan has consistently demonstrated a peaceful and cooperative attitude globally, has significantly enhanced global developments and thus could contribute greatly to the work of various international organisations;

    L. whereas the PRC is a one-party state that is entirely controlled and ruled by the Chinese Communist Party;

    M. whereas in a speech on Taiwan’s national day of 10 October 2024, Taiwan’s President Lai Ching-te stated that the PRC has ‘no right to represent Taiwan’ and reiterated that the two sides are ‘not subordinate’ to each other; whereas the PRC has justified its recent military exercise by claiming that President Lai Ching-te is pursuing a separatist strategy;

    N. whereas on 14 October 2024 the PRC launched a large-scale military drill, named Joint Sword-2024B, that simulated a blockade of Taiwan; whereas during this exercise a record number of 153 PRC aircraft,18 warships and 17 PRC coastguard ships were detected around Taiwan;

    O. whereas during the exercises four formations of the PRC coastguard patrolled the island and briefly entered its restricted waters; whereas the very frequent deployment of the coastguard by the PRC in the Strait in what the PRC considers ‘law enforcement’ missions is putting constant pressure on the Taiwanese authorities and causing a dangerous increase in the risk of collisions, in what is one of the most concrete indications of the PRC’s intention to erode the status quo; whereas the exercises launched on 14 October 2024 were the fourth round of large-scale war games by the PRC in just over two years;

    P. whereas these activities were condemned by Taiwan as an ‘unreasonable provocation’ and are the latest in a series of war games conducted by the PRC against Taiwan; whereas these military drills came days after Lai Ching-te, Taiwan’s new president, gave a speech vowing to protect Taiwan’s sovereignty in the face of challenges from the PRC;

    Q. whereas the median line, which was set up in a decades-old tacit agreement between both sides of the Taiwan Strait, was designed to reduce the risk of conflict by keeping the military aircraft from both sides of the Strait at a safe distance and thus prevent fatal miscalculations; whereas the PRC’s People’s Liberation Army violated the median line only four times between 1954 and 2020, but now routine incursions reflect Beijing’s intent to irreversibly reset long-standing benchmarks;

    R. whereas the press statements by the High Representative of the Union for Foreign Affairs and Security Policy and the US Department of State reaffirm that peace and stability in the Taiwan Strait are of strategic importance for regional and global security and prosperity; whereas the High Representative’s statement recalls the need to preserve the status quo in the Taiwan Strait, opposes any unilateral actions that change the status quo by force or coercion and calls on all parties to exercise restraint and avoid any actions that may further escalate cross-Strait tensions;

    S. whereas on 23 May 2024 the PRC launched a military drill called Joint Sword-2024A, just days after the inauguration of Lai Ching-te as the new President of Taiwan;

    T. whereas over the past few years the PRC has held similar military drills around Taiwan; whereas these military drills have increased in intensity and have been moved closer and closer to Taiwan’s mainland; whereas during a previous drill in August 2022 the PRC also fired missiles into Japan’s exclusive economic zone;

    U. whereas on top of military pressure the PRC has long been pursuing a sophisticated strategy of targeting Taiwan with foreign information manipulation and interference (FIMI), including hybrid and cyberattacks with the goal of undermining Taiwan’s democratic society;

    V. whereas the PRC, under the leadership of Xi Jinping, has said that it will not renounce the use of force to seek unification with Taiwan;

    W. whereas the PRC’s 2005 Anti-Secession Law includes the use of non-peaceful means, triggered by ambiguous thresholds, to achieve what the PRC calls ‘unification’ with Taiwan; whereas such military action is a grave threat to the security and stability of the entire region, with potentially dire global consequences; whereas EU and US deterrence is of strategic importance to dissuade the PRC from undertaking any unilateral action against Taiwan;

    X. whereas the PRC’s increasingly aggressive behaviour, in particular in its own neighbourhood, such as the Taiwan Strait and the South China Sea, poses a risk to regional and global security; whereas since 2019 the PRC has violated the Taiwanese air defence identification zone (ADIZ) with increasing regularity; whereas the PRC has been behaving aggressively across vast areas of the Indo-Pacific and exerting varying degrees of military or economic coercion, which has led to disputes with neighbours such as Japan, India, the Philippines and Australia;

    Y. whereas the EU has condemned the dangerous actions conducted by Chinese coastguard vessels against lawful Philippine maritime operations in the South China Sea on 31 August 2024; whereas this incident is the latest in a series of actions endangering the safety of life at sea and violating the right to freedom of navigation and overflight in compliance with international law; whereas maritime security and freedom of navigation must be ensured in accordance with international law and, in particular, UNCLOS;

    Z. whereas the PRC is supporting Russia’s war of aggression against Ukraine, in particular through the export of dual-use goods to Russia and the ongoing involvement of PRC-based companies in sanctions evasion and circumvention;

    AA. whereas as a permanent member of the UN Security Council, the PRC has a responsibility to work for peace and stability in the region, and particularly in the Taiwan Strait;

    AB. whereas through its 2021 strategy for cooperation in the Indo-Pacific, the EU and its Member States increased their presence in the region, including through a higher military presence of certain Member States and the continued passage of military ships through the Taiwan Strait;

    AC. whereas Taiwan is located in a strategic position in terms of trade, notably in high-tech supply chains; whereas the Taiwan Strait is the primary route for ships travelling from China, Japan, South Korea and Taiwan towards Europe; whereas Taiwan dominates semiconductor manufacturing markets, as its producers manufacture around 50 % of the world’s semiconductor output; whereas the EU’s strategy for cooperation in the Indo-Pacific argues for increasing trade and investment cooperation with Taiwan;

    AD. whereas the EU is Taiwan’s fourth largest trading partner after the PRC, the United States and Japan; whereas in 2022 Taiwan was the EU’s 12th largest trading partner; whereas the EU is the largest source of foreign direct investment in Taiwan; whereas Taiwanese investments in the EU remain below their potential;

    AE. whereas members of the Australian Senate and of the Dutch House of Representatives have recently adopted motions concerning the distortion of UN Resolution 2758 by the PRC and called for support for Taiwan’s greater participation in multilateral organisations;

    1. Reiterates that Taiwan is a key EU partner and a like-minded democratic friend in the Indo-Pacific region; commends Taiwan and the Taiwanese people for their strong democracy and vibrant civil society, demonstrated once more by the peaceful and well-organised elections of 13 January 2024;

    2. Opposes the PRC’s constant distortion of UN Resolution 2758 and its efforts to block Taiwan’s participation in multilateral organisations; calls for the EU and its Member States to support Taiwan’s meaningful participation in relevant international organisations such as the WHO, the ICAO, Interpol and the UNFCCC; further calls on the UN Secretariat to grant Taiwanese nationals and journalists the right to access UN premises for visits, meetings and newsgathering activities;

    3. Strongly condemns the PRC’s unwarranted military exercises of 14 October 2024, its continued military provocations against Taiwan and its continued military build-up, which is changing the balance of power in the Indo-Pacific, and reiterates its firm rejection of any unilateral change to the status quo in the Taiwan Strait; lauds the restraint and disciplined reaction of the Taiwanese authorities and calls for regular exchanges between the EU and its Taiwanese counterparts on relevant security issues;

    4. Reaffirms its strong commitment to the status quo in the Taiwan Strait; underlines that any attempt to unilaterally change the status quo in the Taiwan Strait, particularly by means of force or coercion, will not be accepted and will be met with a decisive and firm reaction;

    5. Underlines that UN Resolution 2758 takes no position on Taiwan; strongly rejects and refutes the PRC’s attempts to distort history and international rules;

    6. Reiterates the EU’s commitment to its ‘One China’ policy as the political foundation of EU-China relations; recalls that the EU’s China strategy emphasises that constructive cross-strait relations are part of promoting peace and security in the whole Asia-Pacific region and that the EU supports initiatives aimed at dialogue and confidence-building;

    7. Underlines that in Taiwan it is up to the people to democratically decide how they want to live and that the status quo in the Taiwan Strait must not be unilaterally changed by the use or threat of force;

    8. Reiterates its strong condemnation of statements by Chinese President Xi Jinping that the PRC will never renounce the right to use force with respect to Taiwan; underlines that the PRC’s use of force or threats or other highly coercive measures to achieve unification is incompatible with international law; expresses grave concern over the PRC’s use of hostile disinformation to undermine trust in Taiwan’s democracy and governance; reiterates its previous calls for the EU and its Member States to cooperate with international partners in helping to sustain democracy in Taiwan, keeping it free from foreign interference and threats; underlines that only Taiwan’s democratically elected government can represent the Taiwanese people on the international stage;

    9. Condemns the PRC’s systematic grey-zone military actions, including cyber and disinformation campaigns against Taiwan, and urges the PRC to halt these activities immediately; calls, in this regard, for cooperation between the EU and Taiwan to be deepened further to enhance structural cooperation on countering disinformation and foreign interference; welcomes the posting of a liaison officer at the European Economic and Trade Office in Taiwan to coordinate joint efforts to tackle disinformation and interference as a first important step towards deeper EU-Taiwan cooperation, and calls for the EU to further deepen cooperation with Taiwan in this key area; praises the courage of the Taiwanese people and the proportionate and dignified reactions of the Taiwanese authorities and institutions in the face of intensifying Chinese threats and activities;

    10. Firmly rejects the PRC’s economic coercion against Taiwan and other countries, as well as against EU Member States, and underlines that such practices are not only illegal under World Trade Organization rules, but that they also have a devastating effect on the PRC’s reputation around the world and will lead to a further loss of trust in the PRC as a responsible actor; stresses the independent right of the EU and its Member States to develop relations with Taiwan in line with their interests and shared values of democracy and human rights without foreign interference; calls on EU and Member State missions abroad to address and provide alternatives to malign PRC business practices, especially in the Global South;

    11. Is very concerned at the adoption of the so-called guidelines for punishing ‘diehard Taiwan independence separatists’ for committing crimes of secession and the incitement of secession jointly announced by the Supreme People’s Court, the Supreme People’s Procuratorate, the ministries for public security and state security and the justice ministry in June 2024, which could lead to harsh punishments for the crime of secession, up to and including the death penalty; strongly condemns the sentencing of one Taiwanese activist to nine years in prison in September 2024 after his arrest in the PRC in 2022, as well as the constant harassment of Taiwanese people working and living in the PRC;

    12. Is seriously concerned about the situation in the East and South China Seas; recalls the importance of respecting international law, including UNCLOS and, in particular, its provisions on the obligation to settle disputes by peaceful means and on maintaining the freedom of navigation and overflight; calls on all countries that have not done so to swiftly ratify UNCLOS; calls for the EU and its Member States to step up their own maritime capacities in the region; reminds the PRC of its responsibilities, as a permanent member of the UN Security Council, to uphold international law and emphasises the obligation to resolve disputes peacefully;

    13. Reaffirms its grave concerns about China’s increasing military investments and capabilities; expresses grave concerns about the renewed Chinese and Russian commitment to further strengthen their military ties and condemns the Chinese supply of components and equipment to Moscow’s military industry; welcomes the Council decision to impose sanctions on Chinese companies for supporting Russia’s war against Ukraine; deplores the ‘no limits’ partnership between Russia and the PRC; welcomes the increasing commitment and military presence of the United States in the Indo-Pacific; reiterates its calls for a coordinated approach to deepening EU-US cooperation on security matters, including through transatlantic parliamentary dialogue;

    14. Strongly welcomes the close cooperation and alignment of Taiwan with the EU and the United States in responding to Russia’s war against Ukraine and issuing sanctions in response to this blatant violation of international law; recalls Taiwan’s help in addressing the humanitarian crisis caused by Russia’s war of aggression against Ukraine and its continuous involvement and support for the Ukrainian government and countries hosting Ukrainian refugees;

    15. Highlights that the PRC’s various actions in the field of cognitive and legal warfare are slowly undermining the status quo, as well as intensifying grey-zone activities that are intended to circumvent detection, existing laws and response thresholds; calls for the EU to establish and enforce its redlines through its toolbox of sanctions, including sectoral sanctions, against hybrid activities and cyberthreats, and to coordinate strong diplomatic and economic deterrence measures with liked-minded partners;

    16. Expresses its gratitude for Taiwan’s help and assistance during the COVID-19 pandemic;

    17. Recognises the importance of Taiwan in securing global supply chains, especially in the high-tech sector where Taiwan is the leading producer of semiconductors, and calls for the EU and its Member States to engage in closer cooperation with Taiwan;

    18. Calls on the Commission to launch, without delay, preparatory measures for negotiations on a bilateral investment agreement, or other kinds of agreement, with Taiwan; highlights the potential for cooperation on foreign direct investment screening policy and on tackling economic coercion and retaliation;

    19. Applauds the increase in freedom of navigation exercises conducted by several EU countries, including France, the Netherlands and Germany; notes that these activities are in line with international law and calls for more cooperation and coordination with regional partners in order to increase freedom of navigation operations in the region;

    20. Welcomes visits by former and current Taiwanese politicians to Europe, including the recent visit of former President Tsai Ing-wen to the European Parliament on 17 October 2024; welcomes, furthermore, continued exchanges of its Members with Taiwan and encourages further visits of official European Parliament delegations to Taiwan; additionally encourages further exchanges between the EU and Taiwan at all levels, including political meetings and people-to-people encounters;

    21. Encourages, in this light, increased economic, scientific and cultural interactions and exchanges, focusing, among other areas, on youth, academia, civil society, sports, culture and education, as well as city-to-city and region-to-region partnerships; reiterates its call on the Member States to engage in meaningful and structural technical cooperation with Taiwan’s National Fire Agency and National Police Agency and with local administrations in the field of civil protection and disaster management;

    22. Instructs its President to forward this resolution to the Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy and the governments of the People’s Republic of China and Taiwan.

     

     

    MIL OSI Europe News –

  • MIL-OSI Europe: MOTION FOR A RESOLUTION on Commission Implementing Decision (EU) 2024/1826 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP23211 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council – B10-0150/2024

    Source: European Parliament

    Committee on the Environment, Public Health and Food Safety
    Members responsible: Martin Häusling, Biljana Borzan, Anja Hazekamp

    B10‑0150/2024

    European Parliament resolution on Commission Implementing Decision (EU) 2024/1826 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP23211 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council (2024/2838(RSP))

    The European Parliament,

    – having regard to Commission Implementing Decision (EU) 2024/1826 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP23211 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council[1],

    – having regard to Regulation (EC) No 1829/2003 of the European Parliament and of the Council of 22 September 2003 on genetically modified food and feed[2], and in particular Article 7(3) and Article 19(3) thereof,

    – having regard to the vote of the Standing Committee on Plants, Animals, Food and Feed referred to in Article 35 of Regulation (EC) No 1829/2003, on 26 April 2024, at which no opinion was delivered, and the vote of the Appeal Committee on 29 May 2024, at which again no opinion was delivered,

    – having regard to Article 11 of Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers[3],

    – having regard to the opinion adopted by the European Food Safety Authority (EFSA) on 29 November 2023, and published on 18 January 2024[4],

    – having regard to its previous resolutions objecting to the authorisation of genetically modified organisms (‘GMOs’)[5],

    – having regard to Rule 115(2) and (3) of its Rules of Procedure,

    – having regard to the motion for a resolution of the Committee on the Environment, Public Health and Food Safety,

    A. whereas, on 11 December 2019, Pioneer Overseas Corporation, based in Belgium, submitted, on behalf of Pioneer Hi-Bred International, Inc., based in the United States, an application to the national competent authority of the Netherlands (the ‘application’) for the placing on the market of foods, food ingredients and feed containing, consisting of or produced from genetically modified maize DP23211 (the ‘GM maize’), in accordance with Articles 5 and 17 of Regulation (EC) No 1829/2003; whereas the application also covered the placing on the market of products containing or consisting of the GM maize for uses other than food and feed, with the exception of cultivation;

    B. whereas, on 29 November 2023, EFSA adopted a favourable opinion, which was published on 18 January 2024;

    C. whereas the GM maize contains genes conferring resistance to glufosinate and produces insecticidal proteins;

    Lack of assessment of the complementary herbicide

    D. whereas Commission Implementing Regulation (EU) No 503/2013[6] requires an assessment of whether the expected agricultural practices influence the outcome of the studied endpoints; whereas, according to that Implementing Regulation, this is especially relevant for herbicide-tolerant plants;

    E. whereas the vast majority of GM crops have been genetically modified so that they are tolerant to one or more ‘complementary’ herbicides which can be used throughout the cultivation of the GM crop, without the crop dying, as would be the case for a non-herbicide tolerant crop; whereas a number of studies show that herbicide-tolerant GM crops result in a higher use of complementary herbicides, in large part because of the emergence of herbicide-tolerant weeds[7];

    F. whereas herbicide-tolerant GM crops lock farmers into a weed management system that is largely or wholly dependent on herbicides, and does so by charging a premium for GM seeds that can be justified only if farmers purchasing such seed also spray the complementary herbicides; whereas heightened reliance on complementary herbicides on farms planting the GM crops accelerate the emergence and spread of weeds resistant to those herbicides, thereby triggering the need for even more herbicide use, a vicious circle known as ‘the herbicide treadmill’;

    G. whereas the adverse impacts stemming from excessive reliance on herbicides will worsen on soil health, water quality, and above and below ground biodiversity, as well as leading to increased human and animal exposure, potentially also via increased herbicide residues on food and feed;

    H. whereas glufosinate is classified as toxic to reproduction 1B and therefore meets the ‘cut-off criteria’ set out in Regulation (EC) No 1107/2009 of the European Parliament and of the Council[8]; whereas the approval of glufosinate for use in the Union expired on 31 July 2018;

    I. whereas assessment of herbicide residues and metabolites found on GM plants is considered outside the remit of the EFSA Panel on Genetically Modified Organisms and is therefore not undertaken as part of the authorisation process for GMOs;

    Member State competent authority and stakeholder comments

    J. whereas Member States submitted many critical comments to EFSA during the three-month consultation period, including that the monitoring plan concerned does not ensure that relevant information for the monitoring of the product is gathered and therefore cannot be considered adequate, as well as that the insecticidal protein produced by the plant has not been adequately assessed;

    Ensuring a global level playing field and upholding the Union’s international obligations

    K. whereas the conclusions of the Strategic Dialogue on the Future of EU Agriculture[9] call on the Commission to reassess its approach on market access for agri-food imports and exports, given the challenge of diverging standards of the Union and its trading partners; whereas fairer trade relations, at a global level, coherent with goals for a healthy environment were one of the main demands of farmers during the demonstrations of 2023 and 2024;

    L. whereas a 2017 report by the United Nations’ (UN) Special Rapporteur on the right to food found that, particularly in developing countries, hazardous pesticides have catastrophic impacts on health[10]; whereas the UN Sustainable Development Goal (UN SDG) Target 3.9 aims by 2030 to substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water and soil pollution and contamination[11];

    M. whereas the Kunming-Montreal Global Biodiversity Framework (‘Kunming-Montreal Framework’), agreed at the COP15 of the UN Convention on Biological Diversity (UN CBD) in December 2022, includes a global target to reduce the risk of pesticides by at least 50 % by 2030[12];

    N. whereas Regulation (EC) No 1829/2003 states that GM food or feed must not have adverse effects on human health, animal health or the environment, and requires the Commission to take into account any relevant provisions of Union law and other legitimate factors relevant to the matter under consideration when drafting its decision; whereas such legitimate factors should include the Union’s obligations under the UN SDGs and the UN CBD;

    Reducing dependency on imported feed

    O. whereas one of the lessons from the COVID-19 crisis and the still ongoing war in Ukraine is the need for the Union to end the dependencies on some critical materials; whereas in the mission letter to Commissioner-designate Christophe Hansen, Commission President Ursula von der Leyen asks him to look at ways to reduce imports of critical commodities[13];

    Undemocratic decision-making

    P. whereas, in its eighth term, Parliament adopted a total of 36 resolutions objecting to the placing on the market of GMOs for food and feed (33 resolutions) and to the cultivation of GMOs in the Union (three resolutions); whereas, in its ninth term, Parliament adopted 38 objections to placing GMOs on the market;

    Q. whereas despite its own acknowledgement of the democratic shortcomings, the lack of support from Member States and the objections of Parliament, the Commission continues to authorise GMOs;

    R. whereas no change of law is required for the Commission to be able not to authorise GMOs when there is no qualified majority of Member States in favour in the Appeal Committee[14];

    S. whereas the vote on 26 April 2024 of the Standing Committee on Plants, Animals, Food and Feed referred to in Article 35 of Regulation (EC) No 1829/2003 delivered no opinion, meaning that the authorisation was not supported by a qualified majority of Member States; whereas the vote on 29 May 2024 of the Appeal Committee again delivered no opinion;

    T. whereas on 2 July 2024, the Commission authorised the placing on the market of the GM maize;

    1. Considers that Implementing Decision (EU) 2024/1826 exceeds the implementing powers provided for in Regulation (EC) No 1829/2003;

    2. Considers that Implementing Decision (EU) 2024/1826 is not consistent with Union law, in that it is not compatible with the aim of Regulation (EC) No 1829/2003, which is, in accordance with the general principles laid down in Regulation (EC) No 178/2002 of the European Parliament and of the Council[15], to provide the basis for ensuring a high level of protection of human life and health, animal health and welfare, and environmental and consumer interests, in relation to GM food and feed, while ensuring the effective functioning of the internal market;

    3. Calls on the Commission to repeal Implementing Decision (EU) 2024/1826;

    4. Calls on the Commission not to authorise herbicide-tolerant GM crops, due to the associated increased use of complementary herbicides and therefore the increased risks to biodiversity, food safety and workers’ health in line with the One Health approach;

    5. Highlights, in this regard, that authorising the import for food or feed uses of any GM plant which has been made tolerant to herbicides that are banned in the Union, such as glufosinate, is incoherent with the Union’s international commitments under, inter alia, the UN SDGs and the UN CBD, including the recently adopted Kunming-Montreal Framework[16];

    6. Expects the Commission, as matter of urgency, to deliver on its commitment to come forward with a proposal to ensure that hazardous chemicals banned in the Union are not produced for export;

    7. Welcomes the fact that the Commission finally recognised, in a letter of 11 September 2020 to Members, the need to take sustainability into account when it comes to authorisation decisions on GMOs[17]; expresses its deep disappointment, however, that, since then the Commission has continued to authorise GMOs for import into the Union, despite ongoing objections by Parliament and no qualified majority of Member States in favour;

    8. Urges the Commission, again, to take into account the Union’s obligations under international agreements, such as the Paris Climate Agreement, the UN CBD and the UN SDGs; reiterates its call for draft implementing acts to be accompanied by an explanatory memorandum explaining how they uphold the principle of ‘do no harm’[18];

    9. Instructs its President to forward this resolution to the Council and the Commission, and to the governments and parliaments of the Member States.

     

    MIL OSI Europe News –

  • MIL-OSI Europe: Press release – EU budget for 2025 to focus on research, health, education, and climate action

    Source: European Parliament

    Parliament demands an EU budget for 2025 that focuses on improving people’s lives, boosting competitiveness, and addressing current challenges.

    MEPs set the overall level of commitment appropriations for the 2025 draft budget at almost €201 billion, €1.24 billion more than the Commission’s proposal from last June. Parliament wants to boost programmes vital in addressing health challenges, supporting young people, agriculture and rural areas, helping people suffering from natural disasters, boosting climate action, managing migration and security needs, and strengthening EU support for neighbouring regions experiencing geopolitical and humanitarian crises. MEPs restored €1.52  billion in funding cuts proposed by the Council, and set payment appropriations at €153.5 billion.

    Repayment costs for the European Recovery Instrument (EURI)

    The EURI repayment costs, which are twice the amount initially forecast for 2025, should not result in reduced funding for essential programmes, like Erasmus+ or R&D, according to Parliament. MEPs want to reverse cuts made by member states to appropriations dedicated to these areas and to use the new “EURI cascade mechanism” introduced by the revision of the EU’s long-term budget . This mechanism is designed to manage escalating Next Generation EU borrowing costs without affecting key initiatives, maintaining the budget’s flexibility and response capacity.

    Quotes

    Victor Negrescu (S&D, Romania), general rapporteur for the EU budget 2025 (for section III – Commission), said: “Today’s vote is a strong signal of support for a citizen-centred EU budget focused on investments in economic development and improving people’s lives. That is why we are asking for an increase of €110 million for actions in the area of health, an additional €70 million for Erasmus, €42 million to protect our citizens against the effects of natural disasters, an additional €96 million for agriculture, €120 million for humanitarian aid, and €110 million for the Eastern and Southern Neighbourhood.”

    Niclas Herbst (EPP, Germany), rapporteur for the other sections, said: “Cybersecurity is vital for EU institutions and has remained a pressing concern since 2023. Another key priority is ensuring that the institutions have enough staff to fulfil new tasks, like for the implementation of the Artificial Intelligence Act. Additionally, improving the security of European External Action Service buildings, particularly in delegations situated in remote and high-risk areas, is essential. To address this, an increase of €37 million is required.”

    Next steps

    The vote initiates three weeks of “conciliation” talks with the Council, with the aim of reaching a deal for next year’s budget, which then has to be voted on by Parliament and signed by its President.

    Background

    Over 90% of the EU budget funds activities in EU countries and beyond, benefiting citizens, regions, farmers, researchers, students, NGOs, and businesses. Unlike national budgets, the EU budget is primarily aimed at investment, to generate growth and opportunities across the European Union.

    The EU serves 27 countries with a total population of 450 million. With these figures in mind, the annual EU budget is actually relatively small – on average €160-180 billion annually in 2021-27. This is comparable to the national budget of Denmark, which serves 5.6 million people, and is about 30% smaller than the budget of Poland, which serves 38 million people. (Source: Commission)

    MIL OSI Europe News –

  • MIL-OSI Europe: MOTION FOR A RESOLUTION on Commission Implementing Decision (EU) 2024/1822 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP915635 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council – B10-0149/2024

    Source: European Parliament

    Committee on the Environment, Public Health and Food Safety
    Members responsible: Martin Häusling, Biljana Borzan, Anja Hazekamp

    B10‑0149/2024

    European Parliament resolution on Commission Implementing Decision (EU) 2024/1822 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP915635 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council (2024/2839(RSP))

    The European Parliament,

    – having regard to Commission Implementing Decision (EU) 2024/1822 authorising the placing on the market of products containing, consisting of or produced from genetically modified maize DP915635 pursuant to Regulation (EC) No 1829/2003 of the European Parliament and of the Council[1],

    – having regard to Regulation (EC) No 1829/2003 of the European Parliament and of the Council of 22 September 2003 on genetically modified food and feed [2], and in particular Article 7(3) and Article 19(3) thereof,

    – having regard to the vote of the Standing Committee on Plants, Animals, Food and Feed referred to in Article 35 of Regulation (EC) No 1829/2003, on 26 April 2024, at which no opinion was delivered, and the vote of the Appeal Committee on 29 May 2024, at which again no opinion was delivered,

    – having regard to Article 11 of Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers[3],

    – having regard to the opinion adopted by the European Food Safety Authority (EFSA) on 30 November 2023, and published on 17 January 2024[4],

    – having regard to its previous resolutions objecting to the authorisation of genetically modified organisms (‘GMOs’)[5],

    – having regard to Rule 115(2) and (3) of its Rules of Procedure,

    – having regard to the motion for a resolution of the Committee on the Environment, Public Health and Food Safety,

    A. whereas, on 20 December 2020, Pioneer Overseas Corporation, Inc. based in Belgium, submitted, on behalf of Pioneer Hi-Bred International, based in the United States, an application to the national competent authority of the Netherlands for the placing on the market of foods, food ingredients and feed containing, consisting of or produced from genetically modified maize DP915635 (the ‘GM maize’), in accordance with Articles 5 and 17 of Regulation (EC) No 1829/2003 (the ‘application’); whereas the application also covered the placing on the market of products containing or consisting of genetically modified maize DP915635 for uses other than food and feed, with the exception of cultivation;

    B. whereas, on 30 November 2023, EFSA adopted a favourable opinion, which was published on 17 January 2024;

    C. whereas the GM maize contains genes conferring resistance to glufosinate and produces the insecticidal IPD079Ea toxin derived from the Ophioglossum pendulum fern; whereas the genetic modification involved a multistep process using CRISPR/Cas to introduce a ‘landing pad’ at the target site, where the gene constructs for the production of the new traits are subsequently inserted;

    Lack of assessment of the complementary herbicide

    D. whereas Commission Implementing Regulation (EU) No 503/2013[6] requires an assessment of whether the expected agricultural practices influence the outcome of the studied endpoints; whereas, according to that Implementing Regulation, this is especially relevant for herbicide-tolerant plants;

    E. whereas the vast majority of GM crops have been genetically modified so that they are tolerant to one or more ‘complementary’ herbicides which can be used throughout the cultivation of the GM crop, without the crop dying, as would be the case for a non-herbicide tolerant crop; whereas a number of studies show that herbicide-tolerant GM crops result in a higher use of complementary herbicides, in large part because of the emergence of herbicide-tolerant weeds[7];

    F. whereas herbicide-tolerant GM crops lock farmers into a weed management system that is largely or wholly dependent on herbicides, and does so by charging a premium for GM seeds that can be justified only if farmers purchasing such seed also spray the complementary herbicides; whereas heightened reliance on complementary herbicides on farms planting the GM crops accelerates the emergence and spread of weeds resistant to those herbicides, thereby triggering the need for even more herbicide use, a vicious circle known as ‘the herbicide treadmill’;

    G. whereas the adverse impacts stemming from excessive reliance on herbicides will worsen on soil health, water quality, and above and below ground biodiversity, as well as leading to increased human and animal exposure, potentially also via increased herbicide residues on food and feed;

    H. whereas glufosinate is classified as toxic to reproduction 1B and therefore meets the ‘cut-off criteria’ set out in Regulation (EC) No 1107/2009 of the European Parliament and of the Council[8]; whereas the approval of glufosinate for use in the Union expired on 31 July 2018;

    I. whereas assessment of herbicide residues and metabolites found on GM plants is considered outside the remit of the EFSA Panel on Genetically Modified Organisms and is therefore not undertaken as part of the authorisation process for GMOs;

    Outstanding questions concerning assessment of the toxin IPD079Ea

    J. whereas the Ophioglossum pendulum toxin (IPD079Ea) is not a part of European flora and has never previously been introduced into the food or feed chain; whereas the mode of action of IPD079Ea has only been poorly described; whereas Member States underline that the introduction of this protein into agriculture and the food chain would require a lot more data on the mode of action and specificity of the toxins;

    Member State competent authority and stakeholder comments

    K. whereas Member States submitted many critical comments to EFSA during the three-month consultation period, including that an opinion on the safety of the GM maize cannot be given in view of the data gaps in the file relating to the requirements of Implementing Regulation (EU) No 503/2013, that the monitoring plan requires further elaboration, and that the effects of glufosinate on the gut microbiome of consumers and on the soil-microflora have not been considered by EFSA, even though they are clearly affected;

    Ensuring a global level playing field and upholding the Union’s international obligations

    L. whereas the conclusions of the Strategic Dialogue on the Future of EU Agriculture[9] call on the Commission to reassess its approach on market access for agri-food imports and exports, given the challenge of diverging standards of the Union and its trading partners; whereas fairer trade relations, at a global level, coherent with goals for a healthy environment were one of the main demands of farmers during the demonstrations of 2023 and 2024;

    M. whereas a 2017 report by the United Nations’ (UN) Special Rapporteur on the right to food found that, particularly in developing countries, hazardous pesticides have catastrophic impacts on health[10]; whereas the UN Sustainable Development Goal (UN SDG) Target 3.9 aims by 2030 to substantially reduce the number of deaths and illnesses from hazardous chemicals and air, water and soil pollution and contamination[11];

    N. whereas the Kunming-Montreal Global Biodiversity Framework (‘Kunming-Montreal Framework’), agreed at the COP15 of the UN Convention on Biological Diversity (UN CBD) in December 2022, includes a global target to reduce the risk of pesticides by at least 50 % by 2030[12];

    O. whereas Regulation (EC) No 1829/2003 states that GM food or feed must not have adverse effects on human health, animal health or the environment, and requires the Commission to take into account any relevant provisions of Union law and other legitimate factors relevant to the matter under consideration when drafting its decision; whereas such legitimate factors should include the Union’s obligations under the UN SDGs and the UN CBD;

    Reducing dependency on imported feed

    P. whereas one of the lessons from the COVID-19 crisis and the still ongoing war in Ukraine is the need for the Union to end the dependencies on some critical materials; whereas in the mission letter to Commissioner-elect Christophe Hansen, Commission President Ursula von der Leyen asks him to look at ways to reduce imports of critical commodities[13];

    Undemocratic decision-making

    Q. whereas, in its eighth term, Parliament adopted a total of 36 resolutions objecting to the placing on the market of GMOs for food and feed (33 resolutions) and to the cultivation of GMOs in the Union (three resolutions); whereas, in its ninth term, Parliament adopted 38 objections to placing GMOs on the market;

    R. whereas despite its own acknowledgement of the democratic shortcomings, the lack of support from Member States and the objections of Parliament, the Commission continues to authorise GMOs;

    S. whereas no change of law is required for the Commission to be able not to authorise GMOs when there is no qualified majority of Member States in favour in the Appeal Committee[14];

    T. whereas the vote on 26 April 2024 of the Standing Committee on Plants, Animals, Food and Feed referred to in Article 35 of Regulation (EC) No 1829/2003 delivered no opinion, meaning that the authorisation was not supported by a qualified majority of Member States; whereas the vote on 29 May 2024 of the Appeal Committee again delivered no opinion;

    U. whereas on 2 July 2024, the Commission authorised the placing on the market of the GM maize;

    1. Considers that Implementing Decision (EU) 2024/1822 exceeds the implementing powers provided for in Regulation (EC) No 1829/2003;

    2. Considers that Implementing Decision (EU) 2024/1822 is not consistent with Union law, in that it is not compatible with the aim of Regulation (EC) No 1829/2003, which is, in accordance with the general principles laid down in Regulation (EC) No 178/2002 of the European Parliament and of the Council[15], to provide the basis for ensuring a high level of protection of human life and health, animal health and welfare, and environmental and consumer interests, in relation to GM food and feed, while ensuring the effective functioning of the internal market;

    3. Calls on the Commission to repeal Implementing Decision (EU) 2024/1822;

    4. Calls on the Commission not to authorise herbicide-tolerant GM crops, due to the associated increased use of complementary herbicides and therefore the increased risks to biodiversity, food safety and workers’ health in line with the One Health approach;

    5. Highlights, in this regard, that authorising the import for food or feed uses of any GM plant which has been made tolerant to herbicides that are banned in the Union, such as glufosinate, is incoherent with the Union’s international commitments under, inter alia, the UN SDGs and the UN CBD, including the recently adopted Kunming-Montreal Framework[16];

    6. Expects the Commission, as matter of urgency, to deliver on its commitment[17] to come forward with a proposal to ensure that hazardous chemicals banned in the Union are not produced for export;

    7. Welcomes the fact that the Commission finally recognised, in a letter of 11 September 2020 to Members, the need to take sustainability into account when it comes to authorisation decisions on GMOs[18]; expresses its deep disappointment, however, that, since then the Commission has continued to authorise GMOs for import into the Union, despite ongoing objections by Parliament and a majority of Member States voting against;

    8. Urges the Commission, again, to take into account the Union’s obligations under international agreements, such as the Paris Climate Agreement, the UN CBD and the UN SDGs; reiterates its call for draft implementing acts to be accompanied by an explanatory memorandum explaining how they uphold the principle of ‘do no harm’[19];

    9. Instructs its President to forward this resolution to the Council and the Commission, and to the governments and parliaments of the Member States.

     

     

    MIL OSI Europe News –

  • MIL-OSI Europe: Written question – Fund for the protection and development of the frontier regions of countries bordering Ukraine, Belarus and Russia – E-002090/2024

    Source: European Parliament

    16.10.2024

    Question for written answer  E-002090/2024
    to the Commission
    Rule 144
    Marta Wcisło (PPE), Merja Kyllönen (The Left), Dan-Ştefan Motreanu (PPE), Jacek Protas (PPE), Nils Ušakovs (S&D), Krzysztof Śmiszek (S&D), Benoit Cassart (Renew), Ewa Kopacz (PPE), Georgiana Teodorescu (ECR), Krzysztof Hetman (PPE), Roberts Zīle (ECR), Lucia Yar (Renew), Reinis Pozņaks (ECR), Olivier Chastel (Renew), Miriam Lexmann (PPE), Krzysztof Brejza (PPE), Mirosława Nykiel (PPE), Elżbieta Katarzyna Łukacijewska (PPE), Vilis Krištopans (PfE), Adrian-George Axinia (ECR), Kamila Gasiuk-Pihowicz (PPE), Andrzej Buła (PPE), Branislav Ondruš (NI), Rihards Kols (ECR), Andrzej Halicki (PPE), Dariusz Joński (PPE), Bartłomiej Sienkiewicz (PPE), Joanna Scheuring-Wielgus (S&D), Bartosz Arłukowicz (PPE), Magdalena Adamowicz (PPE), Michał Szczerba (PPE), Adam Jarubas (PPE), Jagna Marczułajtis-Walczak (PPE), Janusz Lewandowski (PPE), Michał Wawrykiewicz (PPE), Bogdan Andrzej Zdrojewski (PPE), Borys Budka (PPE)

    Europe is facing an unprecedented combination of internal and external threats undermining EU citizens’ security. Military, economic and security challenges are greatest in the EU’s border regions, causing depopulation, investor outflow, business bankruptcies and unemployment rates of up to 16 %. Eastern EU areas have become a buffer zone of the Union. Polish regions such as Lubelskie, Podkarpackie, Podlaskie, and others in countries bordering Russia, Belarus or Ukraine bear the whole burden of threats while simultaneously protecting all Member States. These frontier regions have become the EU’s poorest areas. The European Union, as a values-based community, must take immediate and targeted action.

    • 1.Following the Political Guidelines for 2024-2029 and the overall political consensus on the need to strengthen European security and resilience, what specific measures does the Commission envisage to help the regions bordering Ukraine, Russia and Belarus that are bearing the greatest burden of war in Europe?
    • 2.Using the example of the Just Transition Fund, and taking the solidarity principle as a basis, is the Commission working to establish a specially dedicated fund to support these regions?
    • 3.Can the Commission undertake a study into the positive effects that the creation of such a protection and development fund could have on economic activities and industrial and infrastructure planning, as well as on the broader safety of the EU’s borders?

    Submitted: 16.10.2024

    MIL OSI Europe News –

  • MIL-OSI: QCR Holdings, Inc. Announces Net Income of $27.8 Million for the Third Quarter of 2024

    Source: GlobeNewswire (MIL-OSI)

    Third Quarter 2024 Highlights

    • Net income of $27.8 million, or $1.64 per diluted share
    • Adjusted net income of $30.3 million or $1.78 per diluted share (non-GAAP) resulting in an adjusted ROAA (non-GAAP) of 1.35%
    • Significant increase in net interest income of $3.6 million from the prior quarter, or 6%
    • Net interest margin expanded by 8 basis points to 3.34% adjusted NIM (TEY) (non-GAAP)
    • Continued strong capital markets revenue of $16.3 million
    • Tangible book value (non-GAAP) per share grew $2.35, or 20% annualized
    • TCE/TA ratio (non-GAAP) improved 24 basis points to 9.24%

    MOLINE, Ill., Oct. 23, 2024 (GLOBE NEWSWIRE) — QCR Holdings, Inc. (NASDAQ: QCRH) (the “Company”) today announced quarterly net income of $27.8 million and diluted earnings per share (“EPS”) of $1.64 for the third quarter of 2024, compared to net income of $29.1 million and diluted EPS of $1.72 for the second quarter of 2024.

    Adjusted net income (non-GAAP) and adjusted diluted EPS (non-GAAP) for the third quarter of 2024 were $30.3 million and $1.78, respectively. For the second quarter of 2024, adjusted net income (non-GAAP) was $29.3 million and adjusted diluted EPS (non-GAAP) was $1.73. For the third quarter of 2023, adjusted net income (non-GAAP) was $25.4 million, and adjusted diluted EPS (non-GAAP) was $1.51.

      For the Quarter Ended  
      September 30, June 30, September 30,  
    $ in millions (except per share data) 2024 2024 2023  
    Net Income $ 27.8 $ 29.1 $ 25.1  
    Diluted EPS $ 1.64 $ 1.72 $ 1.49  
    Adjusted Net Income (non-GAAP)* $ 30.3 $ 29.3 $ 25.4  
    Adjusted Diluted EPS (non-GAAP)* $ 1.78 $ 1.73 $ 1.51  
     

    *Adjusted non-GAAP measurements of financial performance exclude non-core and/or nonrecurring income and expense items that management believes are not reflective of the anticipated future operation of the Company’s business. The Company believes these adjusted measurements provide a better comparison for analysis and may provide a better indicator of future performance. See GAAP to non-GAAP reconciliations.

    “We produced exceptional third quarter results, highlighted by our significant growth in net interest income and margin expansion. We also had another quarter of strong capital markets and wealth management revenue,” said Larry J. Helling, Chief Executive Officer. “In addition, we grew core deposits, maintained our excellent asset quality, and significantly increased our tangible book value per share.”

    Net Interest Income Grew 6% and Net Interest Margin Expanded 8 Basis Points

    Net interest income for the third quarter of 2024 totaled $59.7 million, an increase of $3.6 million from the second quarter of 2024, driven by strong growth in loans and investments combined with margin expansion. Loan yields increased and funding costs were stable. Loan discount accretion was $463 thousand during the third quarter of 2024, an increase of $195 thousand from the prior quarter.

    Net interest margin (“NIM”) was 2.90% and NIM on a tax-equivalent yield (“TEY”) basis (non-GAAP) was 3.37% for the third quarter, as compared to 2.82% and 3.27% for the prior quarter, respectively. Adjusted NIM TEY (non-GAAP) of 3.34% for the third quarter of 2024, represented an increase of 8 basis points from 3.26% for the second quarter of 2024.  

    “Our adjusted NIM, on a tax equivalent yield basis (non-GAAP), expanded by 8 basis points from the second quarter to 3.34% and exceeded the upper end of our guidance range,” said Todd A. Gipple, President and Chief Financial Officer. “We are very pleased with another quarter of NIM expansion. Looking ahead, we anticipate continued growth in net interest income and are guiding to further fourth quarter adjusted NIM TEY (non-GAAP) expansion in a range of between 2 to 7 basis points.”

    Strong Noninterest Income Including $16.3 Million of Capital Markets Revenue

    Noninterest income for the third quarter of 2024 totaled $27.2 million, a decrease from $30.9 million in the second quarter of 2024. The Company delivered $16.3 million of capital markets revenue in the quarter compared to $17.8 million in the prior quarter. Capital markets revenue was impacted by a $473 thousand loss from the execution of our third securitization during the quarter, a more modest loss than our prior guidance. Wealth management revenue was $4.5 million for the quarter, a 17% annualized increase from the second quarter. Additionally, the Company recorded $2.2 million of income from bank-owned life insurance policy proceeds in the second quarter of 2024 which did not recur during the third quarter of 2024.

    “Our capital markets business delivered strong results driven by the swap fees from our low-income housing tax credit (“LIHTC”) lending program. The demand for affordable housing remains strong, which supports the sustainability of our LIHTC lending program,” added Mr. Gipple. “Our LIHTC lending pipelines, and the associated capital markets revenue remain robust. Additionally, our wealth management business continues to grow from new client additions and increased assets under management as we expand our market share.”

    During the third quarter, the Company executed a derivative strategy with a notional value of $410 million. These derivatives are designed to safeguard the Company’s regulatory capital ratios against the adverse effects of a significant decline in long-term interest rates. These derivatives are unhedged and are marked-to-market, with gains or losses recorded in noninterest income and reflected as a non-core item. For the quarter, the Company recorded a $414 thousand loss on these derivatives.

    Well Controlled Noninterest Expenses of $53.6 Million Impacted by m2 Equipment Finance Decision

    Noninterest expense for the third quarter of 2024 totaled $53.6 million, compared to $49.9 million for the second quarter and $51.1 million for the third quarter of 2023. The linked-quarter increase was primarily due to the previously announced one-time restructuring and goodwill impairment charges related to the decision to discontinue offering new loans and leases at m2 Equipment Finance, LLC (“m2”).  

    “Our core expenses, excluding m2 one-time charges, were $51.2 million, an increase of $1.3 million, and within our guidance range of $49 to $52 million,” said Mr. Gipple. The linked quarter increase in core expenses for the quarter was primarily driven by higher incentive compensation and advertising expenses. Year-to-date core noninterest expenses remain well controlled, having increased only 2% annually. Excluding the one-time charges and other non-core items, the Company’s adjusted efficiency ratio (non-GAAP) was 58.5% in the third quarter.

    Strong Core Deposit Growth

    During the third quarter of 2024, the Company generated strong deposit growth with core deposits increasing by $166.3 million, or 10.3% annualized, to $6.6 billion. “Year-to-date, core deposits have increased by $398.3 million, which is an annualized growth rate of 8.5%. This is a result of our dedication to expanding market share and building new relationships in our markets,” added Mr. Helling.

    Continued Loan Growth

    During the third quarter of 2024, the Company’s total loans and leases held for investment increased by $53.5 million to $6.7 billion. At quarter end, the Company held $165.9 million of LIHTC loans held for sale in anticipation of the Company’s next loan securitization.

    “Our year-to-date total loan growth excluding the impact of the loans securitized during the third quarter, is 10.5% annualized which was just above our guidance range. Year-to-date loan growth, net of loans securitized, was 5.8% annualized”, added Mr. Helling. “With the continued strength of our markets and healthy pipeline, we are maintaining our loan growth target for the full year 2024 of 8% to 10%, prior to the loan securitizations closed in the third quarter and planned for in the fourth quarter.”  

    Asset Quality Remains Excellent

    The Company’s nonperforming assets (“NPAs”) to total assets ratio was 0.39% on September 30, 2024, unchanged from the prior quarter. NPAs totaled $35.7 million at the end of the third quarter of 2024, a $1.2 million increase from the prior quarter.

    The Company’s total criticized loans, a leading indicator of asset quality, declined by $15.3 million on a linked-quarter basis, and the ratio of criticized loans to total loans and leases as of September 30, 2024, improved to 2.20%, as compared to 2.41% as of June 30, 2024. This marks the fourth consecutive quarter of improvement, resulting in a $50 million reduction in total criticized balances.

    The Company recorded a total provision for credit losses of $3.5 million during the quarter, representing a decline of $2.0 million from the prior quarter. The reduction in the provision for credit losses during the quarter was primarily due to overall credit quality improvements. Net charge-offs were $3.4 million during the third quarter of 2024, an increase of $1.8 million from the prior quarter. The increase in net charge offs primarily resulted from loans and leases at m2. The allowance for credit losses to total loans held for investment decreased to 1.30% from 1.33% as of the prior quarter.

    Continued Strong Capital Levels and Outstanding Tangible Book Value Expansion

    As of September 30, 2024, the Company’s tangible common equity to tangible assets ratio (“TCE”) (non-GAAP) increased to 9.24%. The improvement in TCE was driven by strong earnings and an increase in accumulated other comprehensive income (“AOCI”). The total risk-based capital ratio decreased to 13.87% and the common equity tier 1 ratio decreased to 9.79% due to sizable loan and investment growth partially offset by strong earnings. By comparison, these ratios were 9.00%, 14.21%, and 9.92%, respectively, as of June 30, 2024. The Company remains focused on growing its regulatory capital and targeting TCE (non-GAAP) in the top quartile of its peer group.

    The Company’s tangible book value per share (non-GAAP) increased significantly by $2.35, or 20% annualized, during the third quarter of 2024. AOCI increased $12.1 million during the third quarter primarily due to declining interest rates. Tangible book value per share (non-GAAP) has grown by $5.19 year-to-date, for an annualized growth rate of nearly 16%. The combination of strong earnings, a modest dividend, and improved AOCI contributed to the improvement in tangible book value per share (non-GAAP).

    Conference Call Details
    The Company will host an earnings call/webcast tomorrow, October 24, 2024, at 10:00 a.m. Central Time. Dial-in information for the call is toll-free: 888-346-9286 (international 412-317-5253). Participants should request to join the QCR Holdings, Inc. call. The event will be available for replay through October 31, 2024. The replay access information is 877-344-7529 (international 412-317-0088); access code 4892655. A webcast of the teleconference can be accessed on the Company’s News and Events page at www.qcrh.com. An archived version of the webcast will be available at the same location shortly after the live event has ended.

    About Us
    QCR Holdings, Inc., headquartered in Moline, Illinois, is a relationship-driven, multi-bank holding company serving the Quad Cities, Cedar Rapids, Cedar Valley, Des Moines/Ankeny and Springfield communities through its wholly owned subsidiary banks. The banks provide full-service commercial and consumer banking and trust and wealth management services. Quad City Bank & Trust Company, based in Bettendorf, Iowa, commenced operations in 1994, Cedar Rapids Bank & Trust Company, based in Cedar Rapids, Iowa, commenced operations in 2001, Community State Bank, based in Ankeny, Iowa, was acquired by the Company in 2016, Springfield First Community Bank, based in Springfield, Missouri, was acquired by the Company in 2018, and Guaranty Bank, also based in Springfield, Missouri, was acquired by the Company and merged with Springfield First Community Bank in 2022, with the combined entity operating under the Guaranty Bank name. Additionally, the Company serves the Waterloo/Cedar Falls, Iowa community through Community Bank & Trust, a division of Cedar Rapids Bank & Trust Company. The Company has 36 locations in Iowa, Missouri, Wisconsin and Illinois. As of September 30, 2024, the Company had $9.1 billion in assets, $6.8 billion in loans and $7.0 billion in deposits. For additional information, please visit the Company’s website at www.qcrh.com.

    Special Note Concerning Forward-Looking Statements. This document contains, and future oral and written statements of the Company and its management may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations, plans, objectives, future performance and business of the Company. Forward-looking statements, which may be based upon beliefs, expectations and assumptions of the Company’s management and on information currently available to management, are generally identifiable by the use of words such as “believe,” “expect,” “anticipate,” “bode”, “predict,” “suggest,” “project”, “appear,” “plan,” “intend,” “estimate,” ”annualize,” “may,” “will,” “would,” “could,” “should,” “likely,” “might,” “potential,” “continue,” “annualized,” “target,” “outlook,” as well as the negative forms of those words, or other similar expressions. Additionally, all statements in this document, including forward-looking statements, speak only as of the date they are made, and the Company undertakes no obligation to update any statement in light of new information or future events.  

    A number of factors, many of which are beyond the ability of the Company to control or predict, could cause actual results to differ materially from those in its forward-looking statements. These factors include, among others, the following: (i) the strength of the local, state, national and international economies (including effects of inflationary pressures and supply chain constraints); (ii) the economic impact of any future terrorist threats and attacks, widespread disease or pandemics, acts of war or other threats thereof (including the ongoing conflict in the Middle East and the Russian invasion of Ukraine), or other adverse external events that could cause economic deterioration or instability in credit markets, and the response of the local, state and national governments to any such adverse external events; (iii) changes in accounting policies and practices, as may be adopted by state and federal regulatory agencies, the Financial Accounting Standards Board or the Public Company Accounting Oversight Board; (iv) changes in local, state and federal laws, regulations and governmental policies concerning the Company’s general business, including as a result of the upcoming 2024 presidential election or any changes in response to failures of other banks; (vi) increased competition in the financial services sector, including from non-bank competitors such as credit unions and “fintech” companies, and the inability to attract new customers; (vii) changes in technology and the ability to develop and maintain secure and reliable electronic systems; (viii) unexpected results of acquisitions, which may include failure to realize the anticipated benefits of acquisitions and the possibility that transaction costs may be greater than anticipated; (ix) the loss of key executives or employees; (x) changes in consumer spending; (xi) unexpected outcomes of existing or new litigation involving the Company; (xii) the economic impact of exceptional weather occurrences such as tornadoes, floods and blizzards; (xiii) fluctuations in the value of securities held in our securities portfolio; (xiv) concentrations within our loan portfolio, large loans to certain borrowers, and large deposits from certain clients; (xv) the concentration of large deposits from certain clients who have balances above current Federal Deposit Insurance Corporation insurance limits and may withdraw deposits to diversity their exposure; (xvi) the level of non-performing assets on our balance sheets; (xvii) interruptions involving our information technology and communications systems or third-party servicers; (xviii) breaches or failures of our information security controls or cybersecurity-related incidents, (xix) changes in the interest rates and prepayment rates of the Company’s assets, and (xx) the ability of the Company to manage the risks associated with the foregoing as well as anticipated. These risks and uncertainties should be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements. Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s filings with the Securities and Exchange Commission.

    Contact:
    Todd A. Gipple                                
    President                                
    Chief Financial Officer                        
    (309) 743-7745                                
    tgipple@qcrh.com

       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
      As of  
      September 30, June 30, March 31, December 31, September 30,
      2024 2024 2024 2023 2023  
                 
      (dollars in thousands)  
                 
    CONDENSED BALANCE SHEET            
                 
    Cash and due from banks $ 103,840   $ 92,173   $ 80,988   $ 97,123   $ 104,265    
    Federal funds sold and interest-bearing deposits   159,159     102,262     77,020     140,369     80,650    
    Securities, net of allowance for credit losses   1,146,046     1,033,199     1,031,861     1,005,528     896,394    
    Loans receivable held for sale (1)   167,047     246,124     275,344     2,594     278,893    
    Loans/leases receivable held for investment   6,661,755     6,608,262     6,372,992     6,540,822     6,327,414    
    Allowance for credit losses   (86,321 )   (87,706 )   (84,470 )   (87,200 )   (87,669 )  
    Intangibles   11,751     12,441     13,131     13,821     14,537    
    Goodwill   138,596     139,027     139,027     139,027     139,027    
    Derivatives   261,913     194,354     183,888     188,978     291,295    
    Other assets   524,779     531,855     509,768     497,832     495,251    
    Total assets $ 9,088,565   $ 8,871,991   $ 8,599,549   $ 8,538,894   $ 8,540,057    
                 
    Total deposits $ 6,984,633   $ 6,764,667   $ 6,806,775   $ 6,514,005   $ 6,494,852    
    Total borrowings   660,344     768,671     489,633     718,295     712,126    
    Derivatives   285,769     221,798     211,677     214,098     320,220    
    Other liabilities   181,199     180,536     184,122     205,900     184,476    
    Total stockholders’ equity   976,620     936,319     907,342     886,596     828,383    
    Total liabilities and stockholders’ equity $ 9,088,565   $ 8,871,991   $ 8,599,549   $ 8,538,894   $ 8,540,057    
                 
    ANALYSIS OF LOAN PORTFOLIO            
    Loan/lease mix: (2)            
    Commercial and industrial – revolving $ 387,409   $ 362,115   $ 326,129   $ 325,243   $ 299,588    
    Commercial and industrial – other   1,321,053     1,370,561     1,374,333     1,390,068     1,381,967    
    Commercial and industrial – other – LIHTC   89,028     92,637     96,276     91,710     105,601    
    Total commercial and industrial   1,797,490     1,825,313     1,796,738     1,807,021     1,787,156    
    Commercial real estate, owner occupied   622,072     633,596     621,069     607,365     610,618    
    Commercial real estate, non-owner occupied   1,103,694     1,082,457     1,055,089     1,008,892     955,552    
    Construction and land development   342,335     331,454     410,918     477,424     472,695    
    Construction and land development – LIHTC   913,841     750,894     738,609     943,101     921,359    
    Multi-family   324,090     329,239     296,245     284,721     282,541    
    Multi-family – LIHTC   973,682     1,148,244     1,007,321     711,422     874,439    
    Direct financing leases   19,241     25,808     28,089     31,164     34,401    
    1-4 family real estate   587,512     583,542     563,358     544,971     539,931    
    Consumer   144,845     143,839     130,900     127,335     127,615    
    Total loans/leases $ 6,828,802   $ 6,854,386   $ 6,648,336   $ 6,543,416   $ 6,606,307    
    Less allowance for credit losses   86,321     87,706     84,470     87,200     87,669    
    Net loans/leases $ 6,742,481   $ 6,766,680   $ 6,563,866   $ 6,456,216   $ 6,518,638    
                 
    ANALYSIS OF SECURITIES PORTFOLIO            
    Securities mix:            
    U.S. government sponsored agency securities $ 18,621   $ 20,101   $ 14,442   $ 14,973   $ 16,002    
    Municipal securities   965,810     885,046     884,469     853,645     764,017    
    Residential mortgage-backed and related securities   53,488     54,708     56,071     59,196     57,946    
    Asset backed securities   10,455     12,721     14,285     15,423     16,326    
    Other securities   39,190     38,464     40,539     41,115     43,272    
    Trading securities (3)   58,685     22,362     22,258     22,368     –    
    Total securities $ 1,146,249   $ 1,033,402   $ 1,032,064   $ 1,006,720   $ 897,563    
    Less allowance for credit losses   203     203     203     1,192     1,169    
    Net securities $ 1,146,046   $ 1,033,199   $ 1,031,861   $ 1,005,528   $ 896,394    
                 
    ANALYSIS OF DEPOSITS            
    Deposit mix:            
    Noninterest-bearing demand deposits $ 969,348   $ 956,445   $ 955,167   $ 1,038,689   $ 1,027,791    
    Interest-bearing demand deposits   4,715,087     4,644,918     4,714,555     4,338,390     4,416,725    
    Time deposits   942,847     859,593     875,491     851,950     788,692    
    Brokered deposits   357,351     303,711     261,562     284,976     261,644    
    Total deposits $ 6,984,633   $ 6,764,667   $ 6,806,775   $ 6,514,005   $ 6,494,852    
                 
    ANALYSIS OF BORROWINGS            
    Borrowings mix:            
    Term FHLB advances $ 145,383   $ 135,000   $ 135,000   $ 135,000   $ 135,000    
    Overnight FHLB advances   230,000     350,000     70,000     300,000     295,000    
    Other short-term borrowings   2,750     1,600     2,700     1,500     470    
    Subordinated notes   233,383     233,276     233,170     233,064     232,958    
    Junior subordinated debentures   48,828     48,795     48,763     48,731     48,698    
    Total borrowings $ 660,344   $ 768,671   $ 489,633   $ 718,295   $ 712,126    
                 
    (1) Loans with a fair value of $165.9 million, $243.2 million, $274.8 million and $278.0 million have been identified for securitization and are included in LHFS at September 30, 2024, June 30, 2024, March 31, 2024 and September 30, 2023, respectively.
    (2) Loan categories with significant LIHTC loan balances have been broken out separately. Total LIHTC balances within the loan/lease portfolio were $2.0 billion at September 30, 2024.   
    (3) Trading securities consisted of retained beneficial interests acquired in conjunction with Freddie Mac securitizations completed by the Company.  
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                     
          For the Quarter Ended  
          September 30, June 30, March 31, December 31, September 30,  
          2024 2024 2024 2023 2023  
                     
          (dollars in thousands, except per share data)  
                     
    INCOME STATEMENT              
    Interest income   $ 125,420   $ 119,746 $ 115,049   $ 112,248   $ 108,568    
    Interest expense     65,698     63,583   60,350     56,512     53,313    
    Net interest income     59,722     56,163   54,699     55,736     55,255    
    Provision for credit losses     3,484     5,496   2,969     5,199     3,806    
    Net interest income after provision for credit losses   $ 56,238   $ 50,667 $ 51,730   $ 50,537   $ 51,449    
                     
                     
    Trust fees     $ 3,270   $ 3,103 $ 3,199   $ 3,084   $ 2,863    
    Investment advisory and management fees     1,229     1,214   1,101     1,052     947    
    Deposit service fees     2,294     1,986   2,022     2,008     2,107    
    Gains on sales of residential real estate loans, net     385     540   382     323     476    
    Gains on sales of government guaranteed portions of loans, net     –     12   24     24     –    
    Capital markets revenue     16,290     17,758   16,457     36,956     15,596    
    Earnings on bank-owned life insurance     814     2,964   868     832     1,807    
    Debit card fees     1,575     1,571   1,466     1,561     1,584    
    Correspondent banking fees     507     510   512     465     450    
    Loan related fee income     949     962   836     845     800    
    Fair value gain (loss) on derivatives and trading securities     (886 )   51   (163 )   (582 )   (336 )  
    Other       730     218   154     1,161     299    
    Total noninterest income   $ 27,157   $ 30,889 $ 26,858   $ 47,729   $ 26,593    
                     
                     
    Salaries and employee benefits   $ 31,637   $ 31,079 $ 31,860   $ 41,059   $ 32,098    
    Occupancy and equipment expense     6,168     6,377   6,514     6,789     6,228    
    Professional and data processing fees     4,457     4,823   4,613     4,223     4,456    
    Restructuring expense     1,954     –   –     –     –    
    FDIC insurance, other insurance and regulatory fees     1,711     1,854   1,945     2,115     1,721    
    Loan/lease expense     587     151   378     834     826    
    Net cost of (income from) and gains/losses on operations of other real estate     (42 )   28   (30 )   38     3    
    Advertising and marketing     2,124     1,565   1,483     1,641     1,429    
    Communication and data connectivity     333     318   401     449     478    
    Supplies       278     259   275     333     335    
    Bank service charges     603     622   568     761     605    
    Correspondent banking expense     325     363   305     300     232    
    Intangibles amortization     690     690   690     716     691    
    Goodwill impairment     432     –   –     –     –    
    Payment card processing     785     706   646     836     733    
    Trust expense     395     379   425     413     432    
    Other       1,128     674   617     431     814    
    Total noninterest expense   $ 53,565   $ 49,888 $ 50,690   $ 60,938   $ 51,081    
                     
    Net income before income taxes   $ 29,830   $ 31,668 $ 27,898   $ 37,328   $ 26,961    
    Federal and state income tax expense     2,045     2,554   1,172     4,473     1,840    
    Net income     $ 27,785   $ 29,114 $ 26,726   $ 32,855   $ 25,121    
                     
    Basic EPS   $ 1.65   $ 1.73 $ 1.59   $ 1.96   $ 1.50    
    Diluted EPS   $ 1.64   $ 1.72 $ 1.58   $ 1.95   $ 1.49    
                     
                     
    Weighted average common shares outstanding     16,846,200     16,814,814   16,783,348     16,734,080     16,717,303    
    Weighted average common and common equivalent shares outstanding     16,982,400     16,921,854   16,910,675     16,875,952     16,847,951    
                     
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
          For the Nine Months Ended  
          September 30,   September 30,  
          2024   2023  
                 
          (dollars in thousands, except per share data)  
                 
    INCOME STATEMENT          
    Interest income   $ 360,215     $ 301,162    
    Interest expense     189,631       135,892    
    Net interest income     170,584       165,270    
    Provision for credit losses     11,949       11,340    
    Net interest income after provision for credit losses   $ 158,635     $ 153,930    
                 
                 
    Trust fees     $ 9,572     $ 8,613    
    Investment advisory and management fees     3,544       2,812    
    Deposit service fees     6,302       6,169    
    Gains on sales of residential real estate loans, net     1,307       1,288    
    Gains on sales of government guaranteed portions of loans, net     36       30    
    Capital markets revenue     50,505       55,109    
    Securities losses, net     –       (451 )  
    Earnings on bank-owned life insurance     4,646       3,352    
    Debit card fees     4,612       4,639    
    Correspondent banking fees     1,529       1,197    
    Loan related fee income     2,747       2,221    
    Fair value loss on derivatives and trading securities     (998 )     (680 )  
    Other       1,102       656    
    Total noninterest income   $ 84,904     $ 84,955    
                 
                 
    Salaries and employee benefits   $ 94,576     $ 95,560    
    Occupancy and equipment expense     19,059       18,242    
    Professional and data processing fees     13,893       12,048    
    Post-acquisition compensation, transition and integration costs     –       207    
    Restructuring expense     1,954       –    
    FDIC insurance, other insurance and regulatory fees     5,510       5,022    
    Loan/lease expense     1,116       2,034    
    Net cost of (income from) and gains/losses on operations of other real estate       (44 )     (64 )  
    Advertising and marketing     5,172       4,401    
    Communication and data connectivity     1,052       1,614    
    Supplies       812       921    
    Bank service charges     1,793       1,831    
    Correspondent banking expense     993       663    
    Intangibles amortization     2,070       2,222    
    Goodwill impairment     432       –    
    Payment card processing     2,137       1,820    
    Trust expense     1,199       983    
    Other       2,419       2,089    
    Total noninterest expense   $ 154,143     $ 149,593    
                 
    Net income before income taxes   $ 89,396     $ 89,292    
    Federal and state income tax expense     5,771       8,589    
    Net income     $ 83,625     $ 80,703    
                 
    Basic EPS   $ 4.97     $ 4.82    
    Diluted EPS   $ 4.94     $ 4.79    
                 
                 
    Weighted average common shares outstanding     16,814,787       16,731,847    
    Weighted average common and common equivalent shares outstanding   16,938,309       16,863,203    
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                       
      As of and for the Quarter Ended   For the Nine Months Ended  
      September 30, June 30, March 31, December 31, September 30,
    		   September 30, September 30,  
      2024 2024 2024 2023 2023   2024 2023  
                       
      (dollars in thousands, except per share data)  
                       
    COMMON SHARE DATA                  
    Common shares outstanding   16,861,108     16,824,985     16,807,056     16,749,254     16,731,646          
    Book value per common share (1) $ 57.92   $ 55.65   $ 53.99   $ 52.93   $ 49.51          
    Tangible book value per common share (Non-GAAP) (2) $ 49.00   $ 46.65   $ 44.93   $ 43.81   $ 40.33          
    Closing stock price $ 74.03   $ 60.00   $ 60.74   $ 58.39   $ 48.52          
    Market capitalization $ 1,248,228   $ 1,009,499   $ 1,020,861   $ 977,989   $ 811,819          
    Market price / book value   127.81 %   107.82 %   112.51 %   100.31 %   98.00 %        
    Market price / tangible book value   151.07 %   128.62 %   135.18 %   133.29 %   120.30 %        
    Earnings per common share (basic) LTM (3) $ 6.93   $ 6.78   $ 6.75   $ 6.78   $ 6.65          
    Price earnings ratio LTM (3) 10.68 x 8.85 x 9.00 x 8.61 x 7.30 x        
    TCE / TA (Non-GAAP) (4)   9.24 %   9.00 %   8.94 %   8.75 %   8.05 %        
                       
                       
    CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY          
    Beginning balance $ 936,319   $ 907,342   $ 886,596   $ 828,383   $ 822,689          
    Net income   27,785     29,114     26,726     32,855     25,121          
    Other comprehensive income (loss), net of tax   12,057     (368 )   (5,373 )   25,363     (19,415 )        
    Common stock cash dividends declared   (1,012 )   (1,008 )   (1,008 )   (1,004 )   (1,003 )        
    Other (5)   1,471     1,239     401     999     991          
    Ending balance $ 976,620   $ 936,319   $ 907,342   $ 886,596   $ 828,383          
                       
                       
    REGULATORY CAPITAL RATIOS (6):                  
    Total risk-based capital ratio   13.87 %   14.21 %   14.30 %   14.29 %   14.48 %        
    Tier 1 risk-based capital ratio   10.33 %   10.49 %   10.50 %   10.27 %   10.30 %        
    Tier 1 leverage capital ratio   10.50 %   10.40 %   10.33 %   10.03 %   9.92 %        
    Common equity tier 1 ratio   9.79 %   9.92 %   9.91 %   9.67 %   9.68 %        
                       
                       
    KEY PERFORMANCE RATIOS AND OTHER METRICS                  
    Return on average assets (annualized)   1.24 %   1.33 %   1.25 %   1.54 %   1.21 %     1.27 %   1.34 %  
    Return on average total equity (annualized)   11.55 %   12.63 %   11.83 %   15.42 %   11.99 %     12.00 %   13.18 %  
    Net interest margin   2.90 %   2.82 %   2.82 %   2.90 %   2.89 %     2.85 %   3.00 %  
    Net interest margin (TEY) (Non-GAAP)(7)   3.37 %   3.27 %   3.25 %   3.32 %   3.31 %     3.30 %   3.37 %  
    Efficiency ratio (Non-GAAP) (8)   61.65 %   57.31 %   62.15 %   58.90 %   62.41 %     60.33 %   59.78 %  
    Gross loans/leases held for investment / total assets   73.30 %   74.48 %   74.11 %   76.60 %   74.09 %     73.30 %   77.36 %  
    Gross loans/leases held for investment / total deposits   95.38 %   97.69 %   93.63 %   100.41 %   97.42 %     95.38 %   101.72 %  
    Effective tax rate   6.86 %   8.06 %   4.20 %   11.98 %   6.82 %     6.46 %   9.62 %  
    Full-time equivalent employees   976     988     986     996     987       976     987    
                       
                       
    AVERAGE BALANCES                  
    Assets $ 8,968,653   $ 8,776,002   $ 8,550,855   $ 8,535,732   $ 8,287,813     $ 8,765,913   $ 8,041,141    
    Loans/leases   6,840,527     6,779,075     6,598,614     6,483,572     6,476,512       6,739,773     6,288,343    
    Deposits   6,858,196     6,687,188     6,595,453     6,485,154     6,342,339       6,714,251     6,272,083    
    Total stockholders’ equity   962,302     921,986     903,371     852,163     837,734       929,341     816,591    
                       
                       
                       
    (1) Includes accumulated other comprehensive income (loss).            
    (2) Includes accumulated other comprehensive income (loss) and excludes intangible assets. See GAAP to Non-GAAP reconciliations.    
    (3) LTM : Last twelve months.             
    (4) TCE / TCA : tangible common equity / total tangible assets. See GAAP to non-GAAP reconciliations.         
    (5) Includes mostly common stock issued for options exercised and the employee stock purchase plan, as well as stock-based compensation.    
    (6) Ratios for the current quarter are subject to change upon final calculation for regulatory filings due after earnings release.        
    (7) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.           
    (8) See GAAP to Non-GAAP reconciliations.              
                       
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                               
                               
    ANALYSIS OF NET INTEREST INCOME AND MARGIN                        
                               
        For the Quarter Ended  
        September 30, 2024   June 30, 2024   September 30, 2023  
        Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		   Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		   Average
    Balance    		 Interest
    Earned or
    Paid    		 Average
    Yield or Cost    		  
                               
        (dollars in thousands)  
                               
    Fed funds sold   $ 12,596 $ 173 5.37 %   $ 13,065 $ 183 5.54 %   $ 21,526 $ 284 5.23 %  
    Interest-bearing deposits at financial institutions   145,597   1,915 5.23 %     80,998   1,139 5.66 %     86,807   1,205 5.51 %  
    Investment securities – taxable   381,285   4,439 4.64 %     377,747   4,286 4.53 %     344,657   3,788 4.38 %  
    Investment securities – nontaxable (1)   760,645   10,744 5.65 %     704,761   9,462 5.37 %     600,693   6,974 4.64 %  
    Restricted investment securities   42,546   840 7.73 %     43,398   869 7.92 %     43,590   659 5.91 %  
    Loans (1)     6,840,527   116,854 6.80 %     6,779,075   112,719 6.69 %     6,476,512   103,428 6.34 %  
    Total earning assets (1) $ 8,183,196 $ 134,965 6.56 %   $ 7,999,044 $ 128,658 6.46 %   $ 7,573,785 $ 116,338 6.10 %  
                               
    Interest-bearing deposits $ 4,739,757 $ 42,180 3.54 %   $ 4,649,625 $ 40,924 3.54 %   $ 4,264,208 $ 33,563 3.12 %  
    Time deposits     1,164,560   13,206 4.51 %     1,091,870   12,128 4.47 %     999,488   10,003 3.97 %  
    Short-term borrowings   2,485   32 5.07 %     1,622   21 5.18 %     1,514   20 5.28 %  
    Federal Home Loan Bank advances   445,632   5,972 5.24 %     464,231   6,238 5.32 %     425,870   5,724 5.26 %  
    Subordinated debentures   233,313   3,616 6.20 %     233,207   3,582 6.14 %     232,890   3,307 5.68 %  
    Junior subordinated debentures   48,806   693 5.56 %     48,774   688 5.58 %     48,678   695 5.59 %  
    Total interest-bearing liabilities $ 6,634,553 $ 65,699 3.93 %   $ 6,489,329 $ 63,581 3.93 %   $ 5,972,648 $ 53,312 3.54 %  
                               
    Net interest income (1)   $ 69,266       $ 65,077       $ 63,026    
    Net interest margin (2)     2.90 %       2.82 %       2.89 %  
    Net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.37 %       3.27 %       3.31 %  
    Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.34 %       3.26 %       3.28 %  
                               
                               
        For the Nine Months Ended          
        September 30, 2024   September 30, 2023      
        Average Balance Interest Earned or Paid Average Yield or Cost   Average Balance Interest Earned or Paid Average Yield or Cost          
                               
        (dollars in thousands)          
                               
    Fed funds sold   $ 15,196 $ 625 5.40 %   $ 19,267 $ 741 5.14 %          
    Interest-bearing deposits at financial institutions   106,195   4,254 5.35 %     83,783   3,151 5.03 %          
    Investment securities – taxable   377,538   12,986 4.57 %     340,140   10,847 4.24 %          
    Investment securities – nontaxable (1)   717,284   29,557 5.50 %     599,070   19,892 4.43 %          
    Restricted investment securities   41,348   2,383 7.57 %     38,817   1,677 5.70 %          
    Loans (1)     6,739,773   337,244 6.68 %     6,288,343   285,136 6.06 %          
    Total earning assets (1) $ 7,997,334 $ 387,049 6.46 %   $ 7,369,420 $ 321,444 5.83 %          
                               
    Interest-bearing deposits $ 4,639,937 $ 122,207 3.52 %   $ 4,099,789 $ 84,565 2.76 %          
    Time deposits     1,121,508   37,679 4.49 %     1,020,421   27,225 3.57 %          
    Short-term borrowings   1,846   76 5.47 %     3,588   152 5.66 %          
    Federal Home Loan Bank advances   421,782   16,948 5.28 %     311,740   11,898 5.03 %          
    Subordinated debentures   233,207   10,678 6.10 %     232,784   9,922 5.68 %          
    Junior subordinated debentures   48,774   2,074 5.59 %     48,646   2,129 5.77 %          
    Total interest-bearing liabilities $ 6,467,054 $ 189,662 3.91 %   $ 5,716,968 $ 135,891 3.17 %          
                               
    Net interest income (1)   $ 197,387       $ 185,553            
    Net interest margin (2)     2.85 %       3.00 %          
    Net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.30 %       3.37 %          
    Adjusted net interest margin (TEY) (Non-GAAP) (1) (2) (3)     3.28 %       3.34 %          
                               
                               
    (1) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.  
    (2) See “Select Financial Data – Subsidiaries” for a breakdown of amortization/accretion included in net interest margin for each period presented.     
    (3) TEY : Tax equivalent yield. See GAAP to Non-GAAP reconciliations.            
                               
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
    		  
       
                 
                 
      As of  
      September 30, June 30, March 31, December 31, September 30,
      2024 2024 2024 2023 2023  
                 
      (dollars in thousands, except per share data)  
                 
    ROLLFORWARD OF ALLOWANCE FOR CREDIT LOSSES ON LOANS/LEASES            
    Beginning balance $ 87,706   $ 84,470   $ 87,200   $ 87,669   $ 85,797    
    Change in ACL for transfer of loans to LHFS   (1,812 )   498     (3,377 )   266     175    
    Credit loss expense   3,828     4,343     3,736     2,519     3,260    
    Loans/leases charged off   (3,871 )   (1,751 )   (3,560 )   (3,354 )   (1,816 )  
    Recoveries on loans/leases previously charged off   470     146     471     100     253    
    Ending balance $ 86,321   $ 87,706   $ 84,470   $ 87,200   $ 87,669    
                 
                 
    NONPERFORMING ASSETS            
    Nonaccrual loans/leases $ 33,480   $ 33,546   $ 29,439   $ 32,753   $ 34,568    
    Accruing loans/leases past due 90 days or more   1,298     87     142     86     –    
    Total nonperforming loans/leases   34,778     33,633     29,581     32,839     34,568    
    Other real estate owned   369     369     784     1,347     120    
    Other repossessed assets   542     512     962     –     –    
    Total nonperforming assets $ 35,689   $ 34,514   $ 31,327   $ 34,186   $ 34,688    
                 
                 
    ASSET QUALITY RATIOS            
    Nonperforming assets / total assets   0.39 %   0.39 %   0.36 %   0.40 %   0.41 %  
    ACL for loans and leases / total loans/leases held for investment   1.30 %   1.33 %   1.33 %   1.33 %   1.39 %  
    ACL for loans and leases / nonperforming loans/leases   248.21 %   260.77 %   285.55 %   265.54 %   253.61 %  
    Net charge-offs as a % of average loans/leases   0.05 %   0.02 %   0.05 %   0.05 %   0.02 %  
                 
                 
                 
    INTERNALLY ASSIGNED RISK RATING (1) (2)            
    Special mention $ 80,121   $ 85,096   $ 111,729   $ 125,308   $ 128,052    
    Substandard (3)   70,022     80,345     70,841     70,425     72,550    
    Doubtful (3)   –     –     –     –     –    
        Total Criticized loans (4) $ 150,143   $ 165,441   $ 182,570   $ 195,733   $ 200,602    
                 
    Classified loans as a % of total loans/leases (3)   1.03 %   1.17 %   1.07 %   1.08 %   1.10 %  
    Total Criticized loans as a % of total loans/leases (4)   2.20 %   2.41 %   2.75 %   2.99 %   3.04 %  
                 
                 
                 
                 
    (1) During the first quarter of 2024, the Company revised the risk rating scale used for credit quality monitoring.  
    (2) Amounts exclude the government guaranteed portion, if any. The Company assigns internal risk ratings of Pass for the government guaranteed portion.  
    (3) Classified loans are defined as loans with internally assigned risk ratings of 10 or 11 (7 or 8 prior to January 1, 2024), regardless of performance, and include loans identified as Substandard or Doubtful.  
    (4) Total Criticized loans are defined as loans with internally assigned risk ratings of 9, 10, or 11 (6, 7, or 8 prior to January 1, 2024), regardless of performance, and include loans identified as Special Mention, Substandard, or Doubtful.  
                 
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited)
    		  
       
                             
                             
          For the Quarter Ended For the Nine Months Ended  
          September 30,   June 30,   September 30,   September 30,   September 30,  
      SELECT FINANCIAL DATA – SUBSIDIARIES   2024   2024   2023   2024   2023  
          (dollars in thousands)  
                             
      TOTAL ASSETS                      
      Quad City Bank and Trust (1)   $ 2,552,962     $ 2,559,049     $ 2,433,084            
      m2 Equipment Finance, LLC     349,166       359,012       336,180            
      Cedar Rapids Bank and Trust     2,625,943       2,428,267       2,442,263            
      Community State Bank     1,519,585       1,531,109       1,417,250            
      Guaranty Bank     2,360,301       2,369,754       2,242,638            
                             
      TOTAL DEPOSITS                      
      Quad City Bank and Trust (1)   $ 2,205,465     $ 2,100,520     $ 1,973,989            
      Cedar Rapids Bank and Trust     1,765,964       1,721,564       1,722,905            
      Community State Bank     1,269,147       1,188,551       1,132,724            
      Guaranty Bank     1,778,453       1,791,448       1,722,861            
                             
      TOTAL LOANS & LEASES                      
      Quad City Bank and Trust (1)   $ 2,090,856     $ 2,107,605     $ 2,005,770            
      m2 Equipment Finance, LLC     353,259       363,897       341,041            
      Cedar Rapids Bank and Trust     1,743,809       1,736,438       1,750,986            
      Community State Bank     1,161,805       1,162,686       1,098,479            
      Guaranty Bank     1,832,331       1,847,658       1,751,072            
                             
      TOTAL LOANS & LEASES / TOTAL DEPOSITS                      
      Quad City Bank and Trust (1)     95 %     100 %     102 %          
      Cedar Rapids Bank and Trust     99 %     101 %     102 %          
      Community State Bank     92 %     98 %     97 %          
      Guaranty Bank     103 %     103 %     102 %          
                             
                             
      TOTAL LOANS & LEASES / TOTAL ASSETS                      
      Quad City Bank and Trust (1)     82 %     82 %     82 %          
      Cedar Rapids Bank and Trust     66 %     72 %     72 %          
      Community State Bank     76 %     76 %     78 %          
      Guaranty Bank     78 %     78 %     78 %          
                             
      ACL ON LOANS/LEASES HELD FOR INVESTMENT AS A PERCENTAGE OF LOANS/LEASES HELD FOR INVESTMENT                      
      Quad City Bank and Trust (1)     1.49 %     1.49 %     1.50 %          
      m2 Equipment Finance, LLC     4.11 %     3.86 %     3.52 %          
      Cedar Rapids Bank and Trust     1.38 %     1.44 %     1.47 %          
      Community State Bank     1.06 %     1.14 %     1.28 %          
      Guaranty Bank     1.14 %     1.16 %     1.24 %          
                             
      RETURN ON AVERAGE ASSETS                      
      Quad City Bank and Trust (1)     0.76 %     0.88 %     0.97 %     0.81 %     1.00 %  
      Cedar Rapids Bank and Trust     2.52 %     2.94 %     2.28 %     2.84 %     2.95 %  
      Community State Bank     1.46 %     1.26 %     1.38 %     1.33 %     1.43 %  
      Guaranty Bank     1.28 %     1.42 %     1.23 %     1.20 %     1.07 %  
                             
      NET INTEREST MARGIN PERCENTAGE (2)                      
      Quad City Bank and Trust (1)     3.50 %     3.39 %     3.37 %     3.40 %     3.36 %  
      Cedar Rapids Bank and Trust     3.88 %     3.75 %     3.78 %     3.80 %     3.83 %  
      Community State Bank     3.76 %     3.72 %     3.88 %     3.74 %     3.92 %  
      Guaranty Bank (3)     3.12 %     2.99 %     3.06 %     3.03 %     3.22 %  
                             
      ACQUISITION-RELATED AMORTIZATION/ACCRETION INCLUDED IN NET                  
      INTEREST MARGIN, NET                      
      Cedar Rapids Bank and Trust   $ –     $ –     $ –     $ –     $ (8 )  
      Community State Bank     (1 )     (1 )     (1 )     (3 )     69    
      Guaranty Bank     496       301       572       1,194       1,537    
      QCR Holdings, Inc. (4)     (32 )     (32 )     (32 )     (97 )     (97 )  
                             
    (1 ) Quad City Bank and Trust amounts include m2 Equipment Finance, LLC, as this entity is wholly-owned and consolidated with the Bank. m2 Equipment Finance, LLC is also presented separately for certain (applicable) measurements.  
    (2 ) Includes nontaxable securities and loans. Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.      
    (3 ) Guaranty Bank’s net interest margin percentage includes various purchase accounting adjustments. Excluding those adjustments, net interest margin (Non-GAAP) would have been 2.94% for the quarter ended September 30, 2024, 2.86% for the quarter ended June 30, 2024 and 2.97% for the quarter ended September 30, 2023.        
    (4 ) Relates to the trust preferred securities acquired as part of the Guaranty Bank acquisition in 2017 and the Community National Bank acquisition in 2013.      
                             
     
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited) 
     
                           
        As of
        September 30,   June 30,   March 31,   December 31,   September 30,  
    GAAP TO NON-GAAP RECONCILIATIONS   2024   2024   2024   2023   2023  
        (dollars in thousands, except per share data)
    TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATIO (1)                      
                           
    Stockholders’ equity (GAAP)   $ 976,620     $ 936,319     $ 907,342     $ 886,596     $ 828,383    
    Less: Intangible assets     150,347       151,468       152,158       152,848       153,564    
    Tangible common equity (non-GAAP)   $ 826,273     $ 784,851     $ 755,184     $ 733,748     $ 674,819    
                           
    Total assets (GAAP)   $ 9,088,565     $ 8,871,991     $ 8,599,549     $ 8,538,894     $ 8,540,057    
    Less: Intangible assets     150,347       151,468       152,158       152,848       153,564    
    Tangible assets (non-GAAP)   $ 8,938,218     $ 8,720,523     $ 8,447,391     $ 8,386,046     $ 8,386,493    
                           
    Tangible common equity to tangible assets ratio (non-GAAP)   9.24 %     9.00 %     8.94 %     8.75 %     8.05 %  
                           
                           
                           
    (1) This ratio is a non-GAAP financial measure. The Company’s management believes that this measurement is important to many investors in the marketplace who are interested in changes period-to-period in common equity. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to stockholders’ equity and total assets, which are the most directly comparable GAAP financial measures.  
                           
       
    QCR Holding, Inc.
    Consolidated Financial Highlights
    (Unaudited)
    		  
       
                                   
    GAAP TO NON-GAAP RECONCILIATIONS   For the Quarter Ended   For the Nine Months Ended  
        September 30,   June 30,   March 31,   December 31,   September 30,   September 30,   September 30,  
    ADJUSTED NET INCOME (1)   2024   2024   2024   2023   2023   2024   2023  
        (dollars in thousands, except per share data)  
                                   
    Net income (GAAP)   $ 27,785     $ 29,114     $ 26,726     $ 32,855     $ 25,121     $ 83,625     $ 80,703    
                                   
    Less non-core items (post-tax) (2):                              
    Income:                              
    Securities gains (losses), net     –       –       –       –       –       –       (356 )  
    Fair value gain (loss) on derivatives, net     (542 )     (145 )     (144 )     (460 )     (265 )     (830 )     (537 )  
    Total non-core income (non-GAAP)   $ (542 )   $ (145 )   $ (144 )   $ (460 )   $ (265 )   $ (830 )   $ (893 )  
                                   
    Expense:                              
    Goodwill impairment     432       –       –       –       –       432       –    
    Post-acquisition compensation, transition and integration costs     –       –       –       –       –       –       164    
    Restructuring expense     1,544       –       –       –       –       1,544        
    Total non-core expense (non-GAAP)   $ 1,976     $ –     $ –     $ –     $ –     $ 1,976     $ 164    
                                   
    Adjusted net income (non-GAAP) (1)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    ADJUSTED EARNINGS PER COMMON SHARE (1)                              
                                   
    Adjusted net income (non-GAAP) (from above)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    Weighted average common shares outstanding     16,846,200       16,814,814       16,783,348       16,734,080       16,717,303       16,814,787       16,731,847    
    Weighted average common and common equivalent shares outstanding     16,982,400       16,921,854       16,910,675       16,875,952       16,847,951       16,938,309       16,863,203    
                                   
    Adjusted earnings per common share (non-GAAP):                              
    Basic   $ 1.80     $ 1.74     $ 1.60     $ 1.99     $ 1.52     $ 5.14     $ 4.89    
    Diluted   $ 1.78     $ 1.73     $ 1.59     $ 1.97     $ 1.51     $ 5.10     $ 4.85    
                                   
    ADJUSTED RETURN ON AVERAGE ASSETS AND AVERAGE EQUITY (1)                              
                                   
    Adjusted net income (non-GAAP) (from above)   $ 30,303     $ 29,259     $ 26,870     $ 33,315     $ 25,386     $ 86,431     $ 81,760    
                                   
    Average Assets   $ 8,968,653     $ 8,776,002     $ 8,550,855     $ 8,535,732     $ 8,287,813     $ 8,765,913     $ 8,041,141    
                                   
    Adjusted return on average assets (annualized) (non-GAAP)     1.35 %     1.33 %     1.26 %     1.56 %     1.23 %     1.31 %     1.36 %  
    Adjusted return on average equity (annualized) (non-GAAP)     12.60 %     12.69 %     11.90 %     15.64 %     12.12 %     12.40 %     13.35 %  
                                   
    NET INTEREST MARGIN (TEY) (3)                              
                                   
    Net interest income (GAAP)   $ 59,722     $ 56,163     $ 54,699     $ 55,736     $ 55,255     $ 170,584     $ 165,270    
    Plus: Tax equivalent adjustment (4)     9,544       8,914       8,377       7,954       7,771       26,803       20,283    
    Net interest income – tax equivalent (Non-GAAP)   $ 69,266     $ 65,077     $ 63,076     $ 63,690     $ 63,026     $ 197,387     $ 185,553    
    Less: Acquisition accounting net accretion     463       268       363       673       539       1,094       1,501    
    Adjusted net interest income   $ 68,803     $ 64,809     $ 62,713     $ 63,017     $ 62,487     $ 196,293     $ 184,052    
                                   
    Average earning assets   $ 8,183,196     $ 7,999,044     $ 7,807,720     $ 7,631,035     $ 7,573,785     $ 7,997,334     $ 7,369,420    
                                   
    Net interest margin (GAAP)     2.90 %     2.82 %     2.82 %     2.90 %     2.89 %     2.85 %     3.00 %  
    Net interest margin (TEY) (Non-GAAP)     3.37 %     3.27 %     3.25 %     3.32 %     3.31 %     3.30 %     3.37 %  
    Adjusted net interest margin (TEY) (Non-GAAP)     3.34 %     3.26 %     3.24 %     3.29 %     3.28 %     3.28 %     3.34 %  
                                   
    EFFICIENCY RATIO (5)                              
                                   
    Noninterest expense (GAAP)   $ 53,565     $ 49,888     $ 50,690     $ 60,938     $ 51,081     $ 154,143     $ 149,593    
                                   
    Net interest income (GAAP)   $ 59,722     $ 56,163     $ 54,699     $ 55,736     $ 55,255     $ 170,584     $ 165,270    
    Noninterest income (GAAP)     27,157       30,889       26,858       47,729       26,593       84,904       84,955    
    Total income   $ 86,879     $ 87,052     $ 81,557     $ 103,465     $ 81,848     $ 255,488     $ 250,225    
                                   
    Efficiency ratio (noninterest expense/total income) (Non-GAAP)     61.65 %     57.31 %     62.15 %     58.90 %     62.41 %     60.33 %     59.78 %  
    Adjusted efficiency ratio (core noninterest expense/core total income) (Non-GAAP)     58.45 %     57.19 %     62.01 %     58.57 %     62.15 %     59.16 %     59.43 %  
                                   
                                   
                                   
                                   
    (1) Adjusted net income, adjusted earnings per common share, adjusted return on average assets and average equity are non-GAAP financial measures. The Company’s management believes that these measurements are important to investors as they exclude non-core or non-recurring income and expense items, therefore, they provide a more realistic run-rate for future periods. 
    In compliance with applicable rules of the SEC, these non-GAAP measures are reconciled to net income, which is the most directly comparable GAAP financial measure.    		  
    (2) Non-core or non-recurring items (post-tax) are calculated using an estimated effective federal tax rate of 21% with the exception of goodwill impairment which is not deductible for tax.    
    (3) Interest earned and yields on nontaxable securities and loans are determined on a tax equivalent basis using a 21% effective federal tax rate.        
    (4) Net interest margin (TEY) is a non-GAAP financial measure. The Company’s management utilizes this measurement to take into account the tax benefit associated with certain loans and securities. It is also standard industry practice to measure net interest margin using tax-equivalent measures. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net interest income, which is the most directly comparable GAAP financial measure. In addition, the Company calculates net interest margin without the impact of acquisition accounting net accretion as this can fluctuate and it’s difficult to provide a more realistic run-rate for future periods.          
    (5) Efficiency ratio is a non-GAAP measure. The Company’s management utilizes this ratio to compare to industry peers. The ratio is used to calculate overhead as a percentage of revenue.  
    In compliance with the applicable rules of the SEC, this non-GAAP measure is reconciled to noninterest expense, net interest income and noninterest income, which are the most  directly comparable GAAP financial measures.    		  
       
       
                    

    The MIL Network –

  • MIL-OSI Video: Reporters Without Borders What happened to the 4 journalists who disappeared after a Russian roundup in Melitopol?

    Source: Reporters Without Borders (RSF) (Video Release)

    #UKRAINE: Imprisonment, forced confessions, slavery…What happened to the 4 journalists who disappeared after a Russian roundup in Melitopol? We investigated and managed to find them

    20 August 2023 marked a turning point in the occupation of Melitopol. At the crack of dawn, at least four journalists and news content creators were escorted away by men in military uniform, as documented by RSF. Then, for weeks, silence…

    In October 2023, their arrest was confirmed by Russian propaganda videos in which the journalists were forced to make false confessions – yet no information on their fate or whereabouts has been released since. Russia is holding these media workers illegally, moving them from prison to prison in conditions that are much closer to enforced disappearance than legitimate detention.

    In this video, discover the way RSF retraced the paths of their imprisonment.

    #russiaukrainewar #russia #telegram #desinformation #propagande #russie #kremlin #poutine #media #journalisme #freespeech #freepress #journalists #journaliste #condemningabuses #reportersindanger #libertédelapresse #journalismisntacrime #fightfortruth #humanrights #freemedia #violence #justicenow #picoftheday #libertedelapresse #rsf

    https://www.youtube.com/watch?v=FslSNlIlfQ4

    MIL OSI Video –

  • MIL-OSI: Horizon Bancorp, Inc. Reports Third Quarter 2024 Results, Including EPS of $0.41 and Continued Profitability Improvement, as well as Accretive Balance Sheet Initiatives

    Source: GlobeNewswire (MIL-OSI)

    MICHIGAN CITY, Ind., Oct. 23, 2024 (GLOBE NEWSWIRE) — (NASDAQ GS: HBNC) – Horizon Bancorp, Inc. (“Horizon” or the “Company”), the parent company of Horizon Bank (the “Bank”), announced its unaudited financial results for the three and nine months ended September 30, 2024.

    Net income for the three months ended September 30, 2024 was $18.2 million, or $0.41 per diluted share, compared to net income of $14.1 million, or $0.32, for the second quarter of 2024 and compared to net income of $16.2 million, or $0.37 per diluted share, for the third quarter of 2023.

    Net income for the nine months ended September 30, 2024 was $46.3 million, or $1.05 per diluted share, compared to net income of $53.2 million, or $1.21, for the nine months ended September 30, 2023.

    Third Quarter 2024 Highlights

    • Net interest income increased for the fourth consecutive quarter to $46.9 million, compared to $45.3 million in the linked quarter of 2024. Net interest margin, on a fully taxable equivalent (“FTE”) basis1, expanded for the fourth consecutive quarter to 2.66%, compared to 2.64% in the linked quarter of 2024.
    • Total loans held for investment (“HFI”) were $4.8 billion at September 30, 2024, relatively unchanged from June 30, 2024 balances. However, consistent with the Company’s stated growth strategy, the commercial portfolio showed continued organic growth momentum during the quarter, which was offset with planned run-off of lower-yielding indirect auto loans in the consumer loan portfolio. 
    • Positive deposit growth of 1.7% during the quarter, to $5.7 billion at period end. The quarter was highlighted by stable non-interest bearing deposit balances and growth in core relationship consumer and commercial portfolios. 
    • Credit quality remains strong, with annualized net charge offs of 0.03% of average loans during the third quarter. Non-performing assets to total assets of 0.32% remains well within expected ranges, with no material change in the loss outlook. Provision for loan losses of $1.0 million reflects continued positive credit performance.

    “Horizon continues to execute well on its key strategic initiatives of consistently improving our operating performance through a more productive balance sheet, growth in non-interest income and continued disciplined in our operating model. As a result, we are optimistic on the positive momentum of the franchise through year-end 2024 and into 2025. During the quarter, our commercial team was able to deliver another quarter of quality loan growth, even coming off a strong end to the second quarter. The strength of Horizon’s core deposit franchise showed solid performance, and our credit metrics remain well managed. These efforts led to a third consecutive quarter of sequential growth in pre-tax pre-provision income,” President and Chief Executive Officer Thomas M. Prame said. “Importantly, we continue our efforts to optimize our business model, and are pleased to announce the repositioning of a portion of our securities portfolio and the intended sale of our mortgage warehouse business during the fourth quarter. These shareholder accretive actions are expected to yield sustainable improvement in the profitability of our business that will be evident in the fourth quarter, and positively impact Horizon’s financial performance in 2025.”

    _________________________
    1     Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

    Accretive Fourth Quarter 2024 Strategic Actions

    Horizon announced strategic actions taking place in the fourth quarter of 2024, which are designed to simplify its business, strengthen the balance sheet and improve long-term structural profitability. In October, the Company completed the repositioning of about $325 million of available-for-sale securities. Additionally, the Company has signed a letter of intent to sell its mortgage warehouse business, which is expected to generate a gain-on-sale. Details on these actions, the use of proceeds, and the expected financial impact are available in the Company’s third quarter 2024 investor presentation published at investor.horizonbank.com.

     
    Financial Highlights
    (Dollars in Thousands Except Share and Per Share Data and Ratios, Unaudited)
      Three Months Ended
      September 30,   June 30,   March 31,   December 31,   September 30,
      2024   2024   2024   2023   2023
    Income statement:                  
    Net interest income $ 46,910     $ 45,279     $ 43,288     $ 42,257     $ 42,090  
    Credit loss expense   1,044       2,369       805       1,274       263  
    Non-interest income   11,511       10,485       9,929       (20,449 )     11,830  
    Non-interest expense   39,272       37,522       37,107       39,330       36,168  
    Income tax expense   (75 )     1,733       1,314       6,419       1,284  
    Net income $ 18,180     $ 14,140     $ 13,991     $ (25,215 )   $ 16,205  
                       
    Per share data:                  
    Basic earnings per share $ 0.42     $ 0.32     $ 0.32     $ (0.58 )   $ 0.37  
    Diluted earnings per share   0.41       0.32       0.32       (0.58 )     0.37  
    Cash dividends declared per common share   0.16       0.16       0.16       0.16       0.16  
    Book value per common share   17.27       16.62       16.49       16.47       15.89  
    Market value – high   16.57       12.74       14.44       14.65       12.68  
    Market value – low   11.89       11.29       11.75       9.33       9.90  
    Weighted average shares outstanding – Basic   43,712,059       43,712,059       43,663,610       43,649,585       43,646,609  
    Weighted average shares outstanding – Diluted   44,112,321       43,987,187       43,874,036       43,649,585       43,796,069  
    Common shares outstanding (end of period)   43,712,059       43,712,059       43,726,380       43,652,063       43,648,501  
                       
    Key ratios:                  
    Return on average assets   0.92 %     0.73 %     0.72 %   (1.27)        %     0.81 %
    Return on average stockholders’ equity   9.80       7.83       7.76       (14.23 )     8.99  
    Total equity to total assets   9.52       9.18       9.18       9.06       8.71  
    Total loans to deposit ratio   83.92       85.70       82.78       78.01       76.52  
    Allowance for credit losses to HFI loans   1.10       1.08       1.09       1.13       1.14  
    Annualized net charge-offs of average total loans(1)   0.03       0.05       0.04       0.07       0.07  
    Efficiency ratio   67.22       67.29       69.73       180.35       67.08  
                       
    Key metrics (Non-GAAP)(2):                  
    Net FTE interest margin   2.66 %     2.64 %     2.50 %     2.43 %     2.41 %
    Return on average tangible common equity   12.65       10.18       10.11       (18.76 )     11.79  
    Tangible common equity to tangible assets   7.58       7.22       7.20       7.08       6.72  
    Tangible book value per common share $ 13.46     $ 12.80     $ 12.65     $ 12.60     $ 12.00  
                       
                       
    (1) Average total loans includes loans held for investment and held for sale.
    (2) Non-GAAP financial metrics. See non-GAAP reconciliation included herein for the most directly comparable GAAP measures.
     

    Income Statement Highlights

    Net Interest Income

    Net interest income was $46.9 million in the third quarter of 2024, compared to $45.3 million in the second quarter of 2024, driven by net growth in average interest earning assets of $117.5 million and continued net FTE interest margin expansion during the quarter. Horizon’s net FTE interest margin1 was 2.66% for the third quarter of 2024, compared to 2.64% for the second quarter of 2024, attributable to the favorable mix shift in average interest earning assets toward higher-yielding loans and in the average funding mix toward lower-cost deposit balances. Interest accretion from the fair value of acquired loans did not contribute significantly to the third quarter net interest income, or net FTE interest margin.

    Provision for Credit Losses

    During the third quarter of 2024, the Company recorded a provision for credit losses of $1.0 million. This compares to a provision for credit losses of $2.4 million during the second quarter of 2024, and $0.3 million during the third quarter of 2023. The decrease in the provision for credit losses during the third quarter of 2024 when compared with the second quarter of 2024 was primarily attributable to less total loan growth in the current quarter relative to the prior quarter.

    For the third quarter of 2024, the allowance for credit losses included net charge-offs of $0.4 million, or an annualized 0.03% of average loans outstanding, compared to net charge-offs of $0.6 million, or an annualized 0.05% of average loans outstanding for the second quarter of 2024, and net charge-offs of $0.7 million, or an annualized 0.07% of average loans outstanding, in the third quarter of 2023.

    The Company’s allowance for credit losses as a percentage of period-end loans HFI was 1.10% at September 30, 2024, compared to 1.08% at June 30, 2024 and 1.14% at September 30, 2023.

    Non-Interest Income

    For the Quarter Ended September 30,   June 30,   March 31,   December 31,   September 30,
    (Dollars in Thousands) 2024
    		   2024
    		   2024
    		   2023   2023
    Non-interest Income                  
    Service charges on deposit accounts $ 3,320     $ 3,130     $ 3,214     $ 3,092     $ 3,086  
    Wire transfer fees   123       113       101       103       120  
    Interchange fees   3,511       3,826       3,109       3,224       3,186  
    Fiduciary activities   1,394       1,372       1,315       1,352       1,206  
    Gains (losses) on sale of investment securities   —       —       —       (31,572 )     —  
    Gain on sale of mortgage loans   1,622       896       626       951       1,582  
    Mortgage servicing income net of impairment   412       450       439       724       631  
    Increase in cash value of bank owned life insurance   349       318       298       658       1,055  
    Other income   780       380       827       1,019       964  
    Total non-interest income $ 11,511     $ 10,485     $ 9,929     $ (20,449 )   $ 11,830  
                                           

    Total non-interest income was $11.5 million in the third quarter of 2024, compared to $10.5 million in the second quarter of 2024, due primarily to higher realized gains on sale of mortgage loans and increased other income.

    _________________________
    1     Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

    Non-Interest Expense

    For the Quarter Ended September 30,   June 30,   March 31,   December 31,   September 30,
    (Dollars in Thousands) 2024
    		   2024
    		   2024
    		   2023
    		   2023
    Non-interest Expense                  
    Salaries and employee benefits $ 21,829     $ 20,583     $ 20,268     $ 21,877     $ 20,058  
    Net occupancy expenses   3,207       3,192       3,546       3,260       3,283  
    Data processing   2,977       2,579       2,464       2,942       2,999  
    Professional fees   676       714       607       772       707  
    Outside services and consultants   3,677       3,058       3,359       2,394       2,316  
    Loan expense   1,034       1,038       719       1,345       1,120  
    FDIC insurance expense   1,204       1,315       1,320       1,200       1,300  
    Core deposit intangible amortization   844       844       872       903       903  
    Other losses   297       515       16       508       188  
    Other expense   3,527       3,684       3,936       4,129       3,294  
    Total non-interest expense $ 39,272     $ 37,522     $ 37,107     $ 39,330     $ 36,168  
                                           

    Total non-interest expense was $39.3 million in the third quarter of 2024, compared with $37.5 million in the second quarter of 2024. The increase in non-interest expense during the third quarter of 2024 was primarily driven by a $1.2 million increase in salaries and employee benefits expense, which is partially attributable to a legacy benefits program expense, and a $0.6 million increase in outside services and consultants expense related to strategic initiatives.

    Income Taxes

    Horizon’s effective tax rate was -0.4% for the third quarter of 2024, as compared to 10.9% for the second quarter of 2024. The decrease in the effective tax rate during the third quarter was primarily due to an increase in net realizable tax credits for the current year, which reduced the Company’s estimated annual effective tax rate.

    Balance Sheet

    Total assets increased by $14.9 million, or 0.2%, to $7.93 billion as of September 30, 2024, from $7.91 billion as of June 30, 2024. The increase in total assets is primarily due to increases in federal funds sold of $79.5 million, or 230.6%, to $113.9 million as of September 30, 2024, compared to $34.5 million as of June 30, 2024. The increase in federal funds sold during the period was partially offset by a decrease in other assets of $46.6 million, or 28.1%, to $119.0 million as of September 30, 2024, from $165.7 million as of June 30, 2024.

    Total investment securities remained unchanged, at $2.4 billion as of September 30, 2024, compared to June 30, 2024, as the positive market impact to available for sale securities was offset by normal pay-downs and maturities. There were no purchases of investment securities during the third quarter of 2024.

    Total loans HFI and loans held for sale were relatively consistent at $4.8 billion as of September 30, 2024 compared to $4.8 billion as of June 30, 2024, as growth in commercial loans of $9.5 million were offset by a decline in consumer loans of $43.3 million.

    Total deposit balances increased by $96.9 million, or 1.7%, to $5.7 billion as of September 30, 2024 when compared to balances as of June 30, 2024. Non-interest bearing deposit balances were essentially unchanged during the quarter.

    Total borrowings decreased by $86.4 million, or 7.0%, to $1.1 billion as of September 30, 2024, primarily related to the repayment of a portion of Federal Home Loan Bank advances, when compared to balances as of June 30, 2024.

    Capital

    The following table presents the consolidated regulatory capital ratios of the Company for the previous three quarters:

    For the Quarter Ended September 30,   June 30,   March 31, December 31,
      2024*   2024   2024** 2023**
    Consolidated Capital Ratios            
    Total capital (to risk-weighted assets)   13.52 %     13.41 %     13.75 %   14.04 %
    Tier 1 capital (to risk-weighted assets)   11.70 %     11.59 %     11.89 %   12.13 %
    Common equity tier 1 capital (to risk-weighted assets)   10.74 %     10.63 %     10.89 %   11.11 %
    Tier 1 capital (to average assets)   9.01 %     9.02 %     8.91 %   8.61 %
    *Preliminary estimate – may be subject to change  
    **Prior periods were previously revised (see disclosure in Form 10-Q for the quarterly period ending June 30, 2024)  
       

    As of September 30, 2024, the ratio of total stockholders’ equity to total assets is 9.52%. Book value per common share was $17.27, increasing $0.65 during the third quarter of 2024.

    Tangible common equity1 totaled $588.5 million at September 30, 2024, and the ratio of tangible common equity to tangible assets1 was 7.58% at September 30, 2024, up from 7.22% at June 30, 2024. Tangible book value, which excludes intangible assets from total equity, per common share1 was $13.46, increasing $0.66 during the third quarter of 2024.

    Credit Quality

    As of September 30, 2024, total non-accrual loans increased by $5.3 million, or 29.0%, from June 30, 2024, to 0.49% of total loans HFI. Total non-performing assets increased $5.1 million, or 25.0%, to $25.6 million, compared to $20.5 million as of June 30, 2024. The ratio of non-performing assets to total assets increased to 0.32% compared to 0.26% as of June 30, 2024.

    As of September 30, 2024, net charge-offs decreased by $0.2 million to $0.4 million, compared to $0.6 million as of June 30, 2024 and remain just 0.03% annualized of average loans.

    _________________________
    1     Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.

    Earnings Conference Call

    As previously announced, Horizon will host a conference call to review its third quarter financial results and operating performance.

    Participants may access the live conference call on October 24, 2024 at 7:30 a.m. CT (8:30 a.m. ET) by dialing 833-974-2379 from the United States, 866-450-4696 from Canada or 1-412-317-5772 from international locations and requesting the “Horizon Bancorp Call.” Participants are asked to dial in approximately 10 minutes prior to the call.

    A telephone replay of the call will be available approximately one hour after the end of the conference through November 1, 2024. The replay may be accessed by dialing 877-344-7529 from the United States, 855-669-9658 from Canada or 1–412–317-0088 from other international locations, and entering the access code 9847279.

    About Horizon Bancorp, Inc.

    Horizon Bancorp, Inc. (NASDAQ GS: HBNC) is the $7.9 billion-asset commercial bank holding company for Horizon Bank, which serves customers across diverse and economically attractive Midwestern markets through convenient digital and virtual tools, as well as its Indiana and Michigan branches. Horizon’s retail offerings include prime residential and other secured consumer lending to in-market customers, as well as a range of personal banking and wealth management solutions. Horizon also provides a comprehensive array of in-market business banking and treasury management services, as well as equipment financing solutions for customers regionally and nationally, with commercial lending representing over half of total loans. More information on Horizon, headquartered in Northwest Indiana’s Michigan City, is available at horizonbank.com and investor.horizonbank.com.

    Use of Non-GAAP Financial Measures

    Certain information set forth in this press release refers to financial measures determined by methods other than in accordance with GAAP. Specifically, we have included non-GAAP financial measures relating to net income, diluted earnings per share, pre-tax, pre-provision net income, net interest margin, tangible stockholders’ equity and tangible book value per share, efficiency ratio, the return on average assets, the return on average common equity, and return on average tangible equity. In each case, we have identified special circumstances that we consider to be non-recurring and have excluded them. We believe that this shows the impact of such events as acquisition-related purchase accounting adjustments and swap termination fees, among others we have identified in our reconciliations. Horizon believes these non-GAAP financial measures are helpful to investors and provide a greater understanding of our business and financial results without giving effect to the purchase accounting impacts and one-time costs of acquisitions and non–recurring items. These measures are not necessarily comparable to similar measures that may be presented by other companies and should not be considered in isolation or as a substitute for the related GAAP measure. See the tables and other information below and contained elsewhere in this press release for reconciliations of the non-GAAP information identified herein and its most comparable GAAP measures.

    Forward Looking Statements

    This press release may contain forward–looking statements regarding the financial performance, business prospects, growth and operating strategies of Horizon Bancorp, Inc. and its affiliates (collectively, “Horizon”). For these statements, Horizon claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this press release should be considered in conjunction with the other information available about Horizon, including the information in the filings we make with the Securities and Exchange Commission (the “SEC”). Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. We have tried, wherever possible, to identify such statements by using words such as “anticipate,” “estimate,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance.

    Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include: current financial conditions within the banking industry; changes in the level and volatility of interest rates, changes in spreads on earning assets and changes in interest bearing liabilities; increased interest rate sensitivity; the aggregate effects of elevated inflation levels in recent years; loss of key Horizon personnel; increases in disintermediation; potential loss of fee income, including interchange fees, as new and emerging alternative payment platforms take a greater market share of the payment systems; estimates of fair value of certain of Horizon’s assets and liabilities; changes in prepayment speeds, loan originations, credit losses, market values, collateral securing loans and other assets; changes in sources of liquidity; macroeconomic conditions and their impact on Horizon and its customers; legislative and regulatory actions and reforms; changes in accounting policies or procedures as may be adopted and required by regulatory agencies; litigation, regulatory enforcement, and legal compliance risk and costs; rapid technological developments and changes; cyber terrorism and data security breaches; the rising costs of cybersecurity; the ability of the U.S. federal government to manage federal debt limits; climate change and social justice initiatives; the inability to realize cost savings or revenues or to effectively implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; acts of terrorism, war and global conflicts, such as the Russia and Ukraine conflict and the Israel and Hamas conflict; and supply chain disruptions and delays. These and additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in Horizon’s reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC’s website (www.sec.gov). Undue reliance should not be placed on the forward–looking statements, which speak only as of the date hereof. Horizon does not undertake, and specifically disclaims any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward–looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.

       
      Condensed Consolidated Statements of Income
      (Dollars in Thousands Except Per Share Data, Unaudited)
      Three Months Ended   Nine Months Ended
      September 30,   June 30,   March 31,   December 31,   September 30,   September 30,   September 30,
      2024   2024
    		   2024
    		   2023   2023
    		   2024
    		   2023
    Interest Income                          
    Loans receivable $ 75,488     $ 71,880     $ 66,954     $ 65,583     $ 63,003     $ 214,322     $ 178,961  
    Investment securities – taxable   8,133       7,986       7,362       8,157       8,788       23,481       26,253  
    Investment securities – tax-exempt   6,310       6,377       6,451       6,767       7,002       19,138       21,617  
    Other   957       738       4,497       3,007       1,332       6,192       1,960  
    Total interest income   90,888       86,981       85,264       83,514       80,125       263,133       228,791  
    Interest Expense                          
    Deposits   30,787       28,447       27,990       27,376       24,704       87,224       58,481  
    Borrowed funds   11,131       11,213       11,930       11,765       11,224       34,274       30,713  
    Subordinated notes   830       829       831       870       880       2,490       2,641  
    Junior subordinated debentures issued to capital trusts   1,230       1,213       1,225       1,246       1,227       3,668       3,469  
    Total interest expense   43,978       41,702       41,976       41,257       38,035       127,656       95,304  
    Net Interest Income   46,910       45,279       43,288       42,257       42,090       135,477       133,487  
    Provision for loan losses   1,044       2,369       805       1,274       263       4,218       1,185  
    Net Interest Income after Provision for Loan Losses   45,866       42,910       42,483       40,983       41,827       131,259       132,302  
    Non-interest Income                          
    Service charges on deposit accounts   3,320       3,130       3,214       3,092       3,086       9,664       9,135  
    Wire transfer fees   123       113       101       103       120       337       345  
    Interchange fees   3,511       3,826       3,109       3,224       3,186       10,446       9,637  
    Fiduciary activities   1,394       1,372       1,315       1,352       1,206       4,081       3,728  
    Gains (losses) on sale of investment securities   —       —       —       (31,572 )     —       —       (480 )
    Gain on sale of mortgage loans   1,622       896       626       951       1,582       3,144       3,372  
    Mortgage servicing income net of impairment   412       450       439       724       631       1,301       1,984  
    Increase in cash value of bank owned life insurance   349       318       298       658       1,055       965       3,051  
    Other income   780       380       827       1,019       964       1,987       1,675  
    Total non-interest income   11,511       10,485       9,929       (20,449 )     11,830       31,925       32,447  
    Non-interest Expense                          
    Salaries and employee benefits   21,829       20,583       20,268       21,877       20,058       62,680       58,932  
    Net occupancy expenses   3,207       3,192       3,546       3,260       3,283       9,945       10,095  
    Data processing   2,977       2,579       2,464       2,942       2,999       8,020       8,684  
    Professional fees   676       714       607       772       707       1,997       1,873  
    Outside services and consultants   3,677       3,058       3,359       2,394       2,316       10,094       7,548  
    Loan expense   1,034       1,038       719       1,345       1,120       2,791       3,635  
    FDIC insurance expense   1,204       1,315       1,320       1,200       1,300       3,839       2,680  
    Core deposit intangible amortization   844       844       872       903       903       2,560       2,709  
    Other losses   297       515       16       508       188       828       543  
    Other expense   3,527       3,684       3,936       4,129       3,294       11,147       10,255  
    Total non-interest expense   39,272       37,522       37,107       39,330       36,168       113,901       106,954  
    Income /(Loss) Before Income Taxes   18,105       15,873       15,305       (18,796 )     17,489       49,283       57,795  
    Income tax expense   (75 )     1,733       1,314       6,419       1,284       2,972       4,599  
    Net Income /(Loss) $ 18,180     $ 14,140     $ 13,991     $ (25,215 )   $ 16,205     $ 46,311     $ 53,196  
    Basic Earnings /(Loss) Per Share $ 0.42     $ 0.32     $ 0.32     $ (0.58 )   $ 0.37     $ 1.06     $ 1.22  
    Diluted Earnings/(Loss) Per Share   0.41       0.32       0.32       (0.58 )     0.37       1.05       1.21  
                                                           
      Condensed Consolidated Balance Sheets
      (Dollars in Thousands)
      September 30,
    2024    		   June 30,
    2024    		   March 31,
    2024    		   December 31,
    2023    		   September 30,
    2023
    Assets                  
    Interest earning assets                  
    Federal funds sold $ 113,912     $ 34,453     $ 161,704     $ 401,672     $ 71,576  
    Interest earning deposits   12,107       4,957       9,178       12,071       4,718  
    Interest earning time deposits   735       1,715       1,715       2,205       2,207  
    Federal Home Loan Bank stock   53,826       53,826       53,826       34,509       34,509  
    Investment securities, available for sale   541,170       527,054       535,319       547,251       865,168  
    Investment securities, held to maturity   1,888,379       1,904,281       1,925,725       1,945,638       1,966,483  
    Loans held for sale   2,069       2,440       922       1,418       2,828  
    Gross loans held for investment (HFI)   4,803,996       4,822,840       4,618,175       4,417,630       4,359,002  
    Total Interest earning assets   7,416,194       7,351,566       7,306,564       7,362,394       7,306,491  
    Non-interest earning assets                  
    Allowance for credit losses   (52,881 )     (52,215 )     (50,387 )     (50,029 )     (49,699 )
    Cash   108,815       106,691       100,206       112,772       98,843  
    Cash value of life insurance   37,115       36,773       36,455       36,157       149,212  
    Other assets   119,026       165,656       160,593       177,061       152,280  
    Goodwill   155,211       155,211       155,211       155,211       155,211  
    Other intangible assets   11,067       11,910       12,754       13,626       14,530  
    Premises and equipment, net   93,544       93,695       94,303       94,583       94,716  
    Interest receivable   39,366       43,240       40,008       38,710       37,850  
    Total non-interest earning assets   511,263       560,961       549,143       578,091       652,943  
    Total assets $ 7,927,457     $ 7,912,527     $ 7,855,707     $ 7,940,485     $ 7,959,434  
    Liabilities                  
    Savings and money market deposits $ 3,420,827     $ 3,364,726     $ 3,350,673     $ 3,369,149     $ 3,322,788  
    Time deposits   1,220,653       1,178,389       1,136,121       1,179,739       1,250,606  
    Borrowings   1,142,744       1,229,165       1,219,812       1,217,020       1,214,016  
    Repurchase agreements   122,399       128,169       139,309       136,030       142,494  
    Subordinated notes   55,703       55,668       55,634       55,543       59,007  
    Junior subordinated debentures issued to capital trusts   57,423       57,369       57,315       57,258       57,201  
    Total interest earning liabilities   6,019,749       6,013,486       5,958,864       6,014,739       6,046,112  
    Non-interest bearing deposits   1,085,535       1,087,040       1,093,076       1,116,005       1,126,703  
    Interest payable   11,400       11,240       7,853       22,249       16,281  
    Other liabilities   55,951       74,096       74,664       68,680       76,969  
    Total liabilities   7,172,635       7,185,862       7,134,457       7,221,673       7,266,065  
    Stockholders’ Equity                  
    Preferred stock   —       —       —       —       —  
    Common stock   —       —       —       —       —  
    Additional paid-in capital   358,453       357,673       356,599       356,400       355,478  
    Retained earnings   454,050       442,977       435,927       429,021       461,325  
    Accumulated other comprehensive income (loss)   (57,681 )     (73,985 )     (71,276 )     (66,609 )     (123,434 )
    Total stockholders’ equity   754,822       726,665       721,250       718,812       693,369  
    Total liabilities and stockholders’ equity $ 7,927,457     $ 7,912,527     $ 7,855,707     $ 7,940,485     $ 7,959,434  
                                           
      Loans and Deposits        
      (Dollars in Thousands, Unaudited)        
      September 30,   June 30,   March 31,   December 31,   September 30,   % Change
      2024   2024   2024   2023   2023   Q3’24 vs Q2’24   Q3’24 vs Q3’23
    Commercial:                          
    Commercial real estate $ 2,105,459     $ 2,117,772     $ 1,984,723     $ 1,962,097     $ 1,916,056       (1 )%     10 %
    Commercial & Industrial   808,600       786,788       765,043       712,863       673,188       3 %     20 %
    Total commercial   2,914,059       2,904,560       2,749,766       2,674,960       2,589,244       — %     13 %
    Residential Real estate   801,356       797,956       782,071       681,136       675,399       — %     19 %
    Mortgage warehouse   80,437       68,917       56,548       45,078       65,923       17 %     22 %
    Consumer   1,008,144       1,051,407       1,029,790       1,016,456       1,028,436       (4 )%     (2 )%
    Total loans held for investment   4,803,996       4,822,840       4,618,175       4,417,630       4,359,002       — %     10 %
    Loans held for sale   2,069       2,440       922       1,418       2,828       (15 )%     (27 )%
    Total loans $ 4,806,065     $ 4,825,280     $ 4,619,097     $ 4,419,048     $ 4,361,830       — %     10 %
                               
    Deposits:                          
    Interest bearing deposits                          
    Savings and money market deposits $ 3,420,827     $ 3,364,726     $ 3,350,673     $ 3,369,149     $ 3,322,788       2 %     3 %
    Time deposits   1,220,653       1,178,389       1,136,121       1,179,739       1,250,606       4 %     (2 )%
    Total Interest bearing deposits   4,641,480       4,543,115       4,486,794       4,548,888       4,573,394       2 %     1 %
    Non-interest bearing deposits                          
    Non-interest bearing deposits   1,085,535       1,087,040       1,093,076       1,116,005       1,126,703       — %     (4 )%
    Total deposits $ 5,727,015     $ 5,630,155     $ 5,579,870     $ 5,664,893     $ 5,700,097       2 %     — %
                                                           
      Average Balance Sheet
      (Dollars in Thousands, Unaudited)
      Three Months Ended
      September 30, 2024   June 30, 2024   September 30, 2023
      Average
    Balance    		 Interest(4) Average
    Rate(4)    		   Average
    Balance    		 Interest(4) Average
    Rate(4)    		   Average
    Balance    		 Interest(4) Average
    Rate(4)
    Assets
    Interest earning assets                      
    Federal funds sold $ 64,743   $ 860     5.28 %   $ 47,805   $ 645     5.43 %   $ 92,305   $ 1,247     5.36 %
    Interest earning deposits   8,781     97     4.39 %     7,662     93     4.88 %     8,018     85     4.21 %
    Federal Home Loan Bank stock   53,826     1,607     11.88 %     53,827     1,521     11.36 %     34,509     618     7.10 %
    Investment securities – taxable (1)   1,301,830     6,526     1.99 %     1,309,305     6,465     1.99 %     1,650,081     8,170     1.96 %
    Investment securities – non-taxable (1)   1,125,295     7,987     2.82 %     1,132,065     8,072     2.87 %     1,220,998     8,863     2.88 %
    Total investment securities   2,427,125     14,513     2.38 %     2,441,370     14,537     2.39 %     2,871,079     17,033     2.35 %
    Loans receivable (2) (3)   4,775,788     75,828     6.32 %     4,662,124     72,208     6.23 %     4,280,700     63,254     5.89 %
    Total interest earning assets $ 7,330,263   $ 92,905     5.04 %   $ 7,212,788   $ 89,004     4.96 %   $ 7,286,611   $ 82,237     4.59 %
    Non-interest earning assets                      
    Cash and due from banks $ 108,609         $ 108,319         $ 100,331      
    Allowance for credit losses   (52,111 )         (50,334 )         (49,705 )    
    Other assets   471,259           508,555           587,514      
    Total average assets $ 7,858,020         $ 7,779,328         $ 7,924,751      
                           
    Liabilities and Stockholders’ Equity
    Interest bearing liabilities                      
    Interest bearing deposits $ 3,386,177   $ 18,185     2.14 %   $ 3,334,490   $ 16,814     2.03 %   $ 3,267,594   $ 12,661     1.54 %
    Time deposits   1,189,148     12,602     4.22 %     1,134,590     11,633     4.12 %     1,271,104     12,043     3.76 %
    Borrowings   1,149,952     10,221     3.54 %     1,184,172     10,278     3.49 %     1,180,452     10,399     3.50 %
    Repurchase agreements   123,524     910     2.93 %     125,144     935     3.00 %     136,784     825     2.39 %
    Subordinated notes   55,681     830     5.93 %     55,647     829     5.99 %     58,983     880     5.92 %
    Junior subordinated debentures issued to capital trusts   57,389     1,230     8.53 %     57,335     1,213     8.51 %     57,166     1,227     8.52 %
    Total interest bearing liabilities $ 5,961,871   $ 43,978     2.93 %   $ 5,891,378   $ 41,702     2.85 %   $ 5,972,083   $ 38,035     2.53 %
    Non-interest bearing liabilities
    Demand deposits $ 1,083,214         $ 1,080,676         $ 1,159,241      
    Accrued interest payable and other liabilities   74,563           80,942           77,942      
    Stockholders’ equity   738,372           726,332           715,485      
    Total average liabilities and stockholders’ equity $ 7,858,020         $ 7,779,328         $ 7,924,751      
    Net FTE interest income (non-GAAP) (5)   $ 48,927         $ 47,302         $ 44,202    
    Less FTE adjustments (4)     2,017           2,023           2,112    
    Net Interest Income   $ 46,910         $ 45,279         $ 42,090    
    Net FTE interest margin (Non-GAAP) (4)(5)       2.66 %         2.64 %         2.41 %
     
    (1) Securities balances represent daily average balances for the fair value of securities. The average rate is calculated based on the daily average balance for the amortized cost of securities.
    (2) Includes fees on loans held for sale and held for investment. The inclusion of loan fees does not have a material effect on the average interest rate.
    (3) Non-accruing loans for the purpose of the computation above are included in the daily average loan amounts outstanding. Loan totals are shown net of unearned income and deferred loan fees.
    (4) Management believes fully taxable equivalent, or FTE, interest income is useful to investors in evaluating the Company’s performance as a comparison of the returns between a tax-free investment and a taxable alternative. The Company adjusts interest income and average rates for tax-exempt loans and securities to an FTE basis utilizing a 21% tax rate
    (5) Non-GAAP financial metric. See non-GAAP reconciliation included herein for the most directly comparable GAAP measure.
     
      Credit Quality        
      (Dollars in Thousands Except Ratios, Unaudited)        
      Quarter Ended        
      September 30,   June 30,   March 31,   December 31,   September 30,   % Change
      2024   2024   2024   2023   2023   3Q24 vs 2Q24   3Q24 vs 3Q23
    Non-accrual loans                          
    Commercial $ 6,830     $ 4,321     $ 5,493     $ 7,362     $ 6,919       58 %     (1 )%
    Residential Real estate   9,529       8,489       8,725       8,058       7,644       12 %     25 %
    Mortgage warehouse   —       —       —       —       —       — %     — %
    Consumer   7,208       5,453       4,835       4,290       4,493       32 %     60 %
    Total non-accrual loans   23,567       18,263       19,053       19,710       19,056       29 %     24 %
    90 days and greater delinquent – accruing interest   819       1,039       108       559       392       (21 )%     109 %
    Total non-performing loans   24,386       19,302       19,161       20,269       19,448       26 %     25 %
                               
    Other real estate owned                          
    Commercial $ 1,158     $ 1,111     $ 1,124     $ 1,124     $ 1,287       4 %     (10 )%
    Residential Real estate   —       —       —       182       32       — %     (100 )%
    Mortgage warehouse   —       —       —       —       —       — %     — %
    Consumer   36       57       50       205       72       (37 )%     (50 )%
    Total other real estate owned $ 1,194     $ 1,168     $ 1,174     $ 1,511     $ 1,391       2 %     (14 )%
                               
    Total non-performing assets $ 25,580     $ 20,470     $ 20,335     $ 21,780     $ 20,839       25 %     23 %
                               
    Loan data:                          
    Accruing 30 to 89 days past due loans $ 18,087     $ 19,785     $ 15,154     $ 16,595     $ 13,089       (9 )%     38 %
    Substandard loans   59,775       51,221       47,469       49,526       47,563       17 %     26 %
    Net charge-offs (recoveries)                          
    Commercial   (55 )     57       (57 )     233       142       (196 )%     (139 )%
    Residential Real estate   (9 )     (4 )     (5 )     21       (39 )     (125 )%     77 %
    Mortgage warehouse   —       —       —       —       —       — %     — %
    Consumer   439       534       488       531       619       (18 )%     (29 )%
    Total net charge-offs   375       587       426       785       722       (36 )%     (48 )%
                               
    Allowance for credit losses                          
    Commercial   32,854       31,941       30,514       29,736       29,472       3 %     11 %
    Residential Real estate   2,675       2,588       2,655       2,503       2,794       3 %     (4 )%
    Mortgage warehouse   862       736       659       481       714       17 %     21 %
    Consumer   16,490       16,950       16,559       17,309       16,719       (3 )%     (1 )%
    Total allowance for credit losses $ 52,881     $ 52,215     $ 50,387     $ 50,029     $ 49,699       1 %     6 %
                               
    Credit quality ratios                          
    Non-accrual loans to HFI loans   0.49 %     0.38 %     0.41 %     0.45 %     0.44 %        
    Non-performing assets to total assets   0.32 %     0.26 %     0.26 %     0.27 %     0.26 %        
    Annualized net charge-offs of average total loans   0.03 %     0.05 %     0.04 %     0.07 %     0.07 %        
    Allowance for credit losses to HFI loans   1.10 %     1.08 %     1.09 %     1.13 %     1.14 %        
                                                   
    Non–GAAP Reconciliation of Net Fully-Taxable Equivalent (“FTE”) Interest Margin
    (Dollars in Thousands, Unaudited)
        Three Months Ended
        September 30,   June 30,   March 31,   December 31,   September 30,
        2024   2024   2024   2023   2023
    Interest income (GAAP) (A) $ 90,888     $ 86,981     $ 85,264     $ 83,514     $ 80,125  
    Taxable-equivalent adjustment:                    
    Investment securities – tax exempt (1)     1,677       1,695       1,715       1,799       1,861  
    Loan receivable (2)     340       328       353       314       251  
    Interest income (non-GAAP) (B)   92,905       89,004       87,332       85,627       82,237  
    Interest expense (GAAP) (C)   43,978       41,702       41,976       41,257       38,035  
    Net interest income (GAAP) (D) =(A) – (C)   46,910       45,279       43,288       42,257       42,090  
    Net FTE interest income (non-GAAP) (E) = (B) – (C)   48,927       47,302       45,356       44,370       44,202  
    Average interest earning assets (F)   7,330,263       7,212,788       7,293,559       7,239,034       7,286,611  
    Net FTE interest margin (non-GAAP) (G) = (E*) / (F)   2.66 %     2.64 %     2.50 %     2.43 %     2.41 %
                         
    (1) The following represents municipal securities interest income for investment securities classified as available-for-sale and held-to-maturity
    (2) The following represents municipal loan interest income for loan receivables classified as held for sale and held for investment
    *Annualized
     
    Non–GAAP Reconciliation of Return on Average Tangible Common Equity
    (Dollars in Thousands, Unaudited)
        Three Months Ended
        September 30,   June 30,   March 31,   December 31,   September 30,
        2024   2024   2024   2023   2023
                         
    Net income (loss) (GAAP) (A) $ 18,180     $ 14,140     $ 13,991     $ (25,215 )   $ 16,205  
                         
    Average stockholders’ equity (B)   738,372       726,332       725,083       702,793       715,485  
    Average intangible assets (C)   166,819       167,659       168,519       169,401       170,301  
    Average tangible equity (Non-GAAP) (D) = (B) – (C) $ 571,553     $ 558,673     $ 556,564     $ 533,392     $ 545,184  
    Return on average tangible common equity (“ROACE”) (non-GAAP) (E) = (A*) / (D)   12.65 %     10.18 %     10.11 %   (18.76 )%     11.79 %
    *Annualized                    
                         
    Non–GAAP Reconciliation of Tangible Common Equity to Tangible Assets
    (Dollars in Thousands, Unaudited)
        Three Months Ended
        September 30,   June 30,   March 31,   December 31,   September 30,
        2024   2024   2024   2023   2023
    Total stockholders’ equity (GAAP) (A) $ 754,822     $ 726,665     $ 721,250     $ 718,812     $ 693,369  
    Intangible assets (end of period) (B)   166,278       167,121       167,965       168,837       169,741  
    Total tangible common equity (non-GAAP) (C) = (A) – (B) $ 588,544     $ 559,544     $ 553,285     $ 549,975     $ 523,628  
                         
    Total assets (GAAP) (D)   7,927,457       7,912,527       7,855,707       7,940,485       7,959,434  
    Intangible assets (end of period) (B)   166,278       167,121       167,965       168,837       169,741  
    Total tangible assets (non-GAAP) (E) = (D) – (B) $ 7,761,179     $ 7,745,406     $ 7,687,742     $ 7,771,648     $ 7,789,693  
                         
    Tangible common equity to tangible assets (Non-GAAP) (G) = (C) / (E)   7.58 %     7.22 %     7.20 %     7.08 %     6.72 %
                                             
    Non–GAAP Reconciliation of Tangible Book Value Per Share
    (Dollars in Thousands, Unaudited)
        Three Months Ended
        September 30,   June 30,   March 31,   December 31,   September 30,
        2024
    		   2024
    		   2024
    		   2023
    		   2023
    Total stockholders’ equity (GAAP) (A) $ 754,822     $ 726,665     $ 721,250     $ 718,812     $ 693,369  
    Intangible assets (end of period) (B)   166,278       167,121       167,965       168,837       169,741  
    Total tangible common equity (non-GAAP) (C) = (A) – (B) $ 588,544     $ 559,544     $ 553,285     $ 549,975     $ 523,628  
    Common shares outstanding (D)   43,712,059       43,712,059       43,726,380       43,652,063       43,648,501  
                         
    Tangible book value per common share (non-GAAP) (E) = (C) / (D) $ 13.46     $ 12.80     $ 12.65     $ 12.60     $ 12.00  
                                             
    Contact: John R. Stewart, CFA
      EVP, Chief Financial Officer
    Phone: (219) 814–5833
    Fax: (219) 874–9280
    Date: October 23, 2024
       

    The MIL Network –

  • MIL-OSI USA: ICYMI—Hagerty Joins CNN News Central to Discuss Latest Trump Smear Campaign, Biden-Harris Failed Economic and Foreign Policies

    US Senate News:

    Source: United States Senator for Tennessee Bill Hagerty
    ‘The American public can see right through it.’
    PHILADELPHIA, PA—United States Senator Bill Hagerty (R-TN), former U.S. Ambassador to Japan in the Trump Administration, today joined CNN News Central to discuss the latest outrageous smear campaign against former President Donald Trump and the Biden-Harris Administration’s failures in both the economy and foreign policy.

    *Click the photo above or here to watch*
    Partial Transcript
     Hagerty on his personal experience serving in the Trump Administration: “I’ll say this: I did serve with President Trump as U.S. Ambassador to Japan. We have more U.S. military stations there in Japan than any place else in the world overseas. President Trump came to visit me three times—we always met with our military there—and I never saw anything but the utmost respect, both President Trump’s respect for our military, and their love and respect for him. That’s what I know.”
    Hagerty on John Kelly’s slanderous claims against Trump: “It’s wholly inconsistent with my experience with President Trump. I also have reason to doubt it because there’ve been articles published about ‘losers’ and the things that were supposedly said in Normandy. I called the Ambassador right away. Again, these are old stories that are being drug up, of course, within two weeks of the election. But when I called the Ambassador, she said [the claims were] absolutely not true [regarding] what was attributed to John Kelly [in 2020], 20 other staffers said that was the case as well. I think this is being brought up at a time to divert and deflect. Here’s the story: American people right now need to be asking themselves a very basic question: Are they better off today than they were when President Trump was in office? Kamala Harris is claiming all these things that she might be able to do, yet she’s done none of them for the past three and a half years. What we’ve got is a situation where Kamala Harris can’t find any place where she would differ from Joe Biden. Seventy two percent of Americans think that this country is on the wrong track. All they have to do is look back to the time when President Trump was in office; that debunks these claims. President Trump had our economy working. People respected us—nations respected us—we had people better off in every demographic group. And I think that’s why Americans are seeing President Trump’s polls move forward, and I think that’s why we see these desperate things coming out here at the last minute, again, within the last two weeks, citing something from the deep past. It’s irrelevant at this point. Americans need to know: Will [they] be better off? Seventy two percent of Americans say we’re on the wrong track right now; I think they’re ready for change […] Real wages [are] what I think most people care about. Real wages [are] what they care about, and they were better off [under Trump].”
    Hagerty on the false claim that Trump doesn’t respect the military: “His record as commander in Chief debunks [these baseless claims] in my mind…Because why? He actually did have us in position where there were no wars. You have [President] Joe Biden as Commander in Chief; what did he do? He and [Vice President] Kamala Harris, the last in the room, made a terrible decision in Afghanistan that led to the death of 13 service members, very personal to me. One of them was Ryan Knauss, a Tennessean. And I had to call Ryan’s parents and tell them what happened. You think about it: Joe Biden is there at the return of the remains at Dover. He doesn’t even have time for them; he’s looking at his watch. And when he’s in debate, he tells the world that no military man or woman died under his watch. He just forgot about the 13 that died on his watch. That’s presidential disrespect; I don’t see that coming up. Instead, you have claims that cannot be verified from someone that obviously doesn’t like President Trump and was fired by President Trump […] President Trump is a patriot. He loves this country.”
    Hagerty on Trump’s foreign policies having substantially greater success than Biden-Harris’ policies: “I’ve actually seen Donald Trump in the room with Vladimir Putin and with Xi Jinping, with [Prime Minister Narendra] Modi, with [Former Prime Minister Shinzo] Abe. He’s able to hold his own. I certainly don’t think Kamala Harris could do that. Donald Trump knows how to negotiate. He knows how to deal with world leaders, and he can deal from a position of strength. That’s what Americans need right now. That’s what Americans should be asking themselves this close to the election, is who will represent our nation? Who will put us back in a posture of strength? Donald Trump clearly can do that because he’s done it before. Under his watch, we had no major wars breakout. As soon as Joe Biden and Kamala Harris came back into office, we saw the exact opposite. We’ve got hot wars now in the Middle East—you see what’s happening in Ukraine and Russia…It’s a very bad situation that’s occurred over the past three and a half years. Kamala Harris could have done something about it if she were serious. Obviously, she didn’t, and I think the American public can see right through it.”

    MIL OSI USA News –