Notes to the annual accounts

1. Banks

The cash on bank accounts can be freely disposed of. The bank account is held by FMO on behalf of the programme.

2. Short-term deposits

Short-term deposits are very liquid accounts with high credit ratings and are subject to an insignificant risk of changes in fair value. The programme has on demand full access to the carrying amounts.

3. Current account with FMO

The current account which can be freely disposed of.

4. Total capital

5. Net interest income

6. Off-Balance Sheet information

To meet the financial needs of borrowers, the programme enters into various irrevocable commitments (loan commitments, equity commitments). Though these obligations are not recognized on the balance sheet, they do obtain Credit Risk similar to the loan portfolio. Therefore, provisions are calculated for commitments of AC loans according to the ECL measurement methodology. Note that the programme, however, has currently only one loan commitment on the books (fully undrawn) which is measured at Fair Value. Therefore there is no exposure in the MFF portfolio for which ECL calculation is applicable and subsequently no ECL has been calculated. Refer to the 'Accounting Policy' chapter Fair value of Financial instruments.

Nominal amounts for irrevocable facilities are as follows:

7. Analysis of financial assets and liabilities by measurement basis

The significant accounting policies summary describes how financial instruments are measured, and how income and expenses, including fair value gains and losses, are recognized. The following table gives a breakdown of the carrying amounts of the financial assets and financial liabilities by category as defined by balance sheet heading.

The table below presents the carrying value and estimated fair value of non fair value financial assets and liabilities.

8. Related party information

The programme defines the UK Government, FMO and its Management Board and Supervisory Board as related parties.

UK Government

The Department for Business, Energy and Industrial Strategy (BEIS) of the UK Government has set up the MFF programme. BEIS is the main contributor to MFF, providing funding upon FMO’s request (2021: $67.0 million; 2020: $0).

Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden N.V. (“FMO”)

The Dutch development bank FMO supports sustainable private sector growth in developing and emerging markets by leveraging its expertise in agribusiness, food & water, energy, financial institutions and Dutch business focus areas to invest in impactful businesses. FMO is a public-private partnership, with 51% of FMO’s shares held by the Dutch State and 49% held by commercial banks, trade unions and other members of the private sector. FMO has a triple A rating from both Fitch and Standard & Poor’s.

FMO has been entrusted by the Dutch Government to execute the mandates of several Dutch Government Funds and by the UK Government to execute the mandate of MFF. Currently MASSIF, Building Prospects, Access to Energy – I, FOM, FOM-OS, the Land Use Facility (of the Dutch Fund for Climate and Development, DFCD) and MFF are under FMO’s direct management; the execution of Access to Energy – II and the other facilities of DFCD are performed by third parties on behalf of FMO.

FMO charges a management fee to BEIS and it is reimbursed accordingly from the subsidy amount of MFF. The management fee amounts up to $2.8 million in 2021 (2020: $0 million).

9. Subsequent events

There has been no significant subsequent event between the balance sheet date and the date of approval of these accounts which should be reported by the programme.

On February 24, 2022 the Russian Federation started to invade Ukraine. Ukraine, the Russian Federation and Belarus are not on the MFF list with eligible countries. Therefore, MFF has no direct exposure to these countries and no material impact is expected on the financial statements.