Notes to the special purpose annual accounts

1. Banks

	2024	2023
Banks	6,161	6,028
Balance at December 31	6,161	6,028

The cash in bank accounts can be freely disposed of.

2. Current account with FMO

	2024	2023
Current account with FMO	647	-
Balance at December 31	647	-

3. Short-term deposits

	2024	2023
Money market funds	8,028	20,427
Balance at December 31	8,028	20,427

4. Loans

Loans originated by the Fund include loans to the private sector in developing countries for the account and risk of the Fund.

	Loan portfolio measured at AC	Loan portfolio measured at FVPL	Total 2024
Balance at January 1, 2024	21,212	3,730	24,942
Disbursements	23,574	-	23,574
Interest Capitalization	597	530	1,127
Repayments	-3,708	-	-3,708
Changes in amortizable fees	-34	-	-34
Write-off	-1,418	-	-1,418
Changes in fair value	-	68	68
Changes in accrued income	738	-129	609
Exchange rate differences	2,344	276	2,620
Balance at December 31, 2024	43,305	4,475	47,780
Impairment	-689	-	-689
Net balance at December 31, 2024	42,616	4,475	47,091

	Loan portfolio measured at AC	Loan portfolio measured at FVPL	Total 2023
Balance at January 1, 2023	9,018	4,909	13,927
Disbursements	14,263	688	14,951
Interest Capitalization	-	423	423
Repayments	-1,385	-	-1,385
Changes in amortizable fees	-211	-	-211
Changes in fair value	-	-2,202	-2,202
Changes in accrued income	267	83	350
Exchange rate differences	-740	-171	-911
Balance at December 31, 2023	21,212	3,730	24,942
Impairment	-862	-	-862
Net balance at December 31, 2023	20,350	3,730	24,080

The following tables summarize the loans segmented by sector and geographical area:

	2024
Loans segmented by sector	Stage 1	Stage 2	Stage 3	Fair value	Total
Financial Institutions	14,770	-	-	-	14,770
Energy	-	2,842	-	-	2,842
Agribusiness	21,023	3,195	786	4,475	29,479
Total balance at December 31	35,793	6,037	786	4,475	47,091

	2023
Loans segmented by sector	Stage 1	Stage 2	Stage 3	Fair value	Total
Financial Institutions	9,002	-	2,144	-	11,146
Agribusiness	9,003	-	201	3,730	12,934
Total balance at December 31	18,005	-	2,345	3,730	24,080


	2024
Loans segmented by geographical area	Stage 1	Stage 2	Stage 3	Fair value	Total
Africa	-	2,842	786	4,475	8,103
Asia	24,301	3,195	-	-	27,496
Latin America & the Caribbean	-	-	-	-	-
Europe & Central Asia	6,630	-	-	-	6,630
Non - region specific	4,862	-	-	-	4,862
Total balance at December 31	35,793	6,037	786	4,475	47,091

	2023
Loans segmented by geographical area	Stage 1	Stage 2	Stage 3	Fair value	Total
Africa	-	-	200	3,730	3,930
Asia	13,457	-	-	-	13,457
Latin America & the Caribbean	-	-	2,145	-	2,144
Non - region specific	4,548	-	-	-	4,549
Total balance at December 31	18,005	-	2,345	3,730	24,080

The movements in the gross carrying amounts and ECL allowance for the loan portfolio measured at AC are as follows:

Changes in loans to the private sector at AC in 2024	Stage 1		Stage 2		Stage 3		Total
	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance
At December 31, 2023	18,216	-211	-	-	2,996	-651	21,212	-862
Additions	20,799	-398	2,775	-75	-	-	23,574	-473
Exposures derecognised or matured / lapsed (excluding write-offs and modifications)	-759	18	-1,531	51	-1,418	1,116	-3,708	1,185
Transfers to Stage 1	-	-	-	-	-	-	-	-
Transfers to Stage 2	-4,600	108	4,600	-108	-	-	-	-
Transfers to Stage 3	-	-	-	-	-	-	-	-
Modifications of financial assets (including derecognition)	-	-	-	-	597	-	597	-
Changes in risk profile not related to transfers	-	182	-	-123	-	-1,899	-	-1,840
Amounts written off	-	-	-	-	-1,418	1,418	-1,418	1,418
Changes in amortizable fees	-61	-	27	-	-	-	-34	-
Changes in accrued income	686	-	73	-	-21	-	738	-
Foreign exchange adjustments	1,834	-21	360	-12	150	-84	2,344	-117
At December 31, 2024	36,115	-322	6,304	-267	886	-100	43,305	-689

Changes in loans to the private sector at AC in 2023	Stage 1		Stage 2		Stage 3		Total
	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance	Gross carrying amount	ECL allowance
At December 31, 2022	4,737	-20	4,281	-91	-	-	9,018	-111
Additions	14,035	-270	-	-	-	-	14,035	-270
Exposures derecognised or matured / lapsed (excluding write-offs and modifications)	-	-	-	-	-1,158	4	-1,158	4
Transfers to Stage 1	-	-	-	-	-	-	-	-
Transfers to Stage 2	-	-	-	-	-	-	-	-
Transfers to Stage 3	-	-	-4,281	91	4,281	-91	-	-
Changes in risk profile not related to transfers	-	75	-	-	-	-573	-	-498
Changes in amortizable fees	-240	-	-	-	29	-	-211	-
Changes in accrued income	312	-	-	-	-45	-	267	-
Foreign exchange adjustments	-628	4	-	-	-111	9	-739	13
At December 31, 2023	18,216	-211	-	-	2,996	-651	21,212	-862

5. ECL allowances - assessment

ECL allowances are calculated for Interest bearing Securities, Loans at private sector at AC (including off balance loan commitments) and Guarantees Given to customers. The movement in ECL allowances for each of these items is presented in their relevant notes.

To demonstrate the sensitivity of the SICR criteria, the tables below presents the distribution of stage 2 impairments by the criteria that triggered the migration to stage 2. For 2023 there were no balances.

December 31, 2024
ECL allowance - Stage 2 trigger assessment	Loan portfolio	Loan commitments	Total

More than 30 days past due	-	-	-
Deterioration in credit risk	267	-	267
Total	267	-	267

6. Equity investments

The equity investments in developing countries are for the Fund's account and risk. The movements in fair value of the equity investments are summarized in the following table. Equity investments are measured at FVPL.

	2024	2023
Net balance at January 1	-	2,104
Purchases and contributions	221	-
Changes in fair value	-190	-2,104
Net balance at December 31	31	-

The following table summarizes the equity investments segmented by sector:

	2024	2023
Multi-Sector Fund Investments	31	-
Net balance at December 31	31	-

7. Other receivables

	2024	2023
Debtor fees	18	102
Balance at December 31	18	102

8. Loan FMO

	Loan FMO
Balance at January 1, 2024	-
Received from FMO	6,401
Repayments	-
Changes in accrued income	55
Net balance at December 31, 2024	6,456

9. Accrued liabilities

	2024	2023
Accrued liabilities	605	-
Balance at December 31	605	-

10. Provisions

	2024	2023
Allowance for loan commitments	51	135
Balance at December 31	51	135

11. Contributed fund capital and reserves

	2024	2023
Contributed Fund Capital
Contributions DGIS - Available to consortium partners previous years	67,399	55,651
Contributions DGIS - Available to consortium partners current year	497	11,748
Balance at December 31	67,896	67,399

	2024	2023
Undistributed results
Balance at January 1	-10,639	-3,950
Net profit / (loss)	-6,258	-6,689
Balance at December 31	-16,897	-10,639

12. Net interest income

Interest income

	2024	2023
Interest on loans measured at AC	2,950	953
Interest on bank accounts	112	412
Total interest income from financial instruments measured at AC	3,062	1,365
Interest on loans measured at FVPL	401	505
Interest on short-term deposits	706	281
Total interest income from financial instruments measured at FVPL	1,107	786
Total interest income	4,169	2,151

Interest expense

	2024	2023
Interest payable on loan FMO	-55	-
Total interest expenses	-55	-

13. Net fee and commission income

	2024	2023
Administration fees	11	7
Net fee and commission income	11	7

14. Results from equity investments

	2024	2023
Results from equity investments:
Unrealized results from changes in fair value	-190	-2,104
Total results from equity investments	-190	-2,104

15. Results from financial transactions

	2024	2023
Results on sales and valuations of FVPL loans	68	-2,202
Foreign exchange results	2,683	-1,449
Total results from financial transactions	2,751	-3,651

16. Operating income

	2024	2023
Other operating income	8	-
Total other operating income	8	-

17. Operating expenses

The following table presents the operating expenses incurred in 2024 and 2023. Next to direct personnel costs, direct project costs relate mainly to audit and advisory expenses. Furthermore, overhead costs incurred relate to legal fees and costs for support staff.

	2024	2023
Direct Personnel costs	-1,394	-1,380
Other direct project costs	-368	-373
Overhead / indirect costs	-	-7
Total operating costs	-1,762	-1,760

18. Off-Balance Sheet information

To meet the financial needs of borrowers, the Fund enters into various irrevocable commitments (loan commitments, equity, and grants).

Irrevocable facilities	2024	2023
Contractual commitments for disbursements of:
Loans	7,195	16,049
Equity	9,423	-
Total irrevocable facilities	16,618	16,049

The movement in exposure for the loan commitments is as follows:

IFRS 9 Changes in loans commitments in 2024	Stage 1		Stage 2		Stage 3		Total
	Nominal amount	ECL allowance	Nominal amount	ECL allowance	Nominal amount	ECL allowance	Nominal amount	ECL allowance
Outstanding exposure as at January 1, 2024	15,823	-135	-	-	-	-	15,823	-135
Additions	13,808	-136	-	-	1,020	-109	14,828	-245
Exposure derecognised or matured/lapsed (excluding write offs)	-20,799	215	-2,775	-	-597	109	-24,171	324
Transfers to Stage 1	-	-	-	-	-	-	-	-
Transfers to Stage 2	-2,712	41	2,712	-41	-	-	-	-
Transfers to Stage 3	-	-	-	-	-	-	-	-
Changes to models and inputs used for ECL calculations	-	-31	-	41	-		-	10
Foreign exchange adjustments	643	-5	63	-	9	-	715	-5
At December 31, 2024	6,763	-51	-	-	432	-	7,195	-51

IFRS 9 Changes in loans commitments in 2023	Stage 1		Stage 2		Stage 3		Total
	Nominal amount	ECL allowance	Nominal amount	ECL allowance	Nominal amount	ECL allowance	Nominal amount	ECL allowance
Outstanding exposure as at January 1, 2023	-	-	-	-	-	-	-	-
New exposures	30,459	-238	-	-	-	-	30,459	-238
Exposure derecognised or matured/lapsed (excluding write offs)	-14,263	164	-	-	-	-	-14,263	164
Changes to models and inputs used for ECL calculations	-	-62	-	-			-	-62
Foreign exchange adjustments	-373	1	-	-	-	-	-373	1
At December 31, 2023	15,823	-135	-	-	-	-	15,823	-135

19. Analysis of financial assets and liabilities by measurement basis

The significant accounting policies summary describes how the classes of 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 in under IFRS and by balance sheet heading.

December 31, 2024	FVPL - mandatory	Amortized cost	Total
Financial assets
Banks	-	6,161	6,161
Current account with FMO	-	647	647
Short-term deposits	8,028	-	8,028
Loan portfolio	4,475	42,616	47,091
Equity investments	31	-	31
Other receivables	-	18	18
Total Financial assets	12,534	49,442	61,976
Financial liabilities
Loan FMO	-	6,456	6,456
Accrued liabilities	-	605	605
Provisions	-	51	51
Total Financial liabilities	-	7,112	7,112

December 31, 2023	FVPL - mandatory	Amortized cost	Total
Financial assets
Banks	-	6,028	6,028
Short-term deposits	20,427	-	20,427
Loan portfolio	3,730	20,350	24,080
Equity investments	-	-	-
Other receivables	-	102	102
Total Financial assets	24,157	26,480	50,637
Financial liabilities
Provisions	-	135	135
Total Financial liabilities	-	135	135

Fair value hierarchy

All financial instruments for which fair value is recognized or disclosed are categorized within the fair value hierarchy, based on lowest level input that is significant to the fair value measurement as a whole, as follows:
Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable;
Level 3 – Valuation technique for which the lowest level input that is significant to the fair value measurement is unobservable.

Valuation process

For recurring and non-recurring fair value measurements categorized within Level 3 of the fair value hierarchy, the Fund uses the valuation processes to decide its valuation policies and procedures and analyze changes in fair value measurement from period to period.

The fair value methodology and governance over it’s methods includes a number of controls and other procedures to ensure appropriate safeguards are in place to ensure its quality and adequacy. The responsibility of ongoing measurement resides with the relevant departments. Once submitted, fair value estimates are also reviewed and challenged by the FRC. The FRC approves the fair values measured including the valuation techniques and other significant input parameters used.

Valuation technique

When available, the fair value of an instrument is measured by using the quoted price in an active market for that instrument (level 1). A market is regarded as active if transactions of the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis.

If there is no quoted price in an active market, valuation techniques are used that maximize the use of relevant observable inputs and minimize the use of unobservable inputs.

Valuation techniques include:

Recent broker / price quotations
Discounted cash flow model
Option-pricing models

The techniques incorporate current market and contractual prices, time to expiry, yield curves and volatility of the underlying instrument. Inputs used in pricing models are market observable (level 2) or are not market observable (level 3). A substantial part of fair value (level 3) is based on net asset values.

Equity investments are measured at fair value when a quoted market price in an active market is available or when fair value can be estimated reliably by using a valuation technique. The main part of the fair value measurement related to equity investments (level 3) is based on net asset values of investment funds as reported by the fund manager and are based on advanced valuation methods and practices. When available, these fund managers value the underlying investments based on quoted prices, if not available multiples are applied as input for the valuation. For the valuation process of the equity investments we further refer to the accounting policies within these Annual Accounts as well as section 'Equity Risk', part of the Risk Management chapter. The determination of the timing of transfers is embedded in the quarterly valuation process, and is therefore recorded at the end of each reporting period.

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

	2024		2023
At December 31	Carrying value	Fair value	Carrying value	Fair value
Non fair value financial assets
Banks	6,161	6,161	6,028	6,028
Current account with FMO	647	647	-	-
Loans to the private sector at AC	42,616	43,593	20,350	21,450
Other receivables	31	31	-	-
Total non fair value financial assets	49,455	50,432	26,378	27,478
Financial liabilities not measured at fair value
Loan FMO	6,456	6,456
Accrued liabilities	604	604	-	-
Total financial liabilities not measured at fair value	7,060	7,060	-	-

The following table gives an overview of the financial instruments measured at fair value using a fair value hierarchy that reflects the significance of the inputs used in making the measurements.

December 31, 2024	Level 1	Level 2	Level 3	Total
Financial assets at FVPL
Short-term deposits	8,028	-	-	8,028
Loans portfolio	-	-	4,475	4,475
Equity investments	-	-	31	31
Total financial assets at fair value	8,028	-	4,506	12,534

December 31, 2023	Level 1	Level 2	Level 3	Total
Financial assets at FVPL
Short-term deposits	20,427	-	-	20,427
Loans portfolio	-	-	3,730	3,730
Equity investments	-	-	-	-
Total financial assets at fair value	20,427	-	3,730	24,157

The following table shows the movements of financial assets measured at fair value based on level 3.

	Loans portfolio	Equity investments	Total
Balance at January 1, 2024	3,730	-	3,730
Total gains or losses
ˑ In profit and loss (changes in fair value)	68	-192	-124
Purchases/disbursements	-	221	221
Interest Capitalization	530	-	530
Accrued income	-129	-	-129
Exchange rate differences	276	2	278
Balance at December 31, 2024	4,475	31	4,506

	Loans portfolio	Equity investments	Total
Balance at January 1, 2023	4,909	2,104	7,013
Total gains or losses
ˑ In profit and loss (changes in fair value)	-2,202	-2,104	-4,306
Purchases/disbursements	688	-	688
Interest Capitalization	423	-	423
Accrued income	83	-	83
Exchange rate differences	-171	-	-171
Balance at December 31, 2023	3,730	-	3,730

Type of debt investment	Fair value at December 31, 2024	Valuation technique	Range (weighted average) of significant unobservable inputs	Fair value measurement sensitivity to unobservable inputs
Loans	4,475	Discounted cash flow model	Based on client spread	A decrease/increase of the used spreads with 1% will result is a higher/lower fair value of approx € 0.04m.
Total	4,475

20. Related party information

The Fund defines the Dutch Government as related parties.

Dutch Government:

The Dutch Ministry of Foreign Affairs, in particular Directoraat-Generaal Internationale Samenwerking (DGIS), sets up and administers the investment funds (“State Funds”), including the DFCD Land-use Facility, according to the Dutch Government’s development agenda. DGIS is the main contributor to the DFCD facilities, providing funding upon FMO’s request for a net amount of €8.9 million in 2024 (2023: €25.0 million).

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 focus areas - agribusiness, food & water, energy, financial institutions, Dutch business - 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 the State Funds. Currently MASSIF, Building Prospects, Access to Energy – I, FOM and the Land Use Facility of DFCD are under FMO’s direct management; the execution of Access to Energy – II and the other facilities of DFCD are performed by third parties under FMO’s supervision.

In 2024 the DFCD Aya program was launched which resulted in a loan commitment of €240 million from FMO towards LUF, €105 million of which is guaranteed by the European Commission. As at the date of this report, € 6.4 million has been disbursed to LUF under this program. Interest of € 0.05 million is recognized as an expense in the current financial year.

The operating expenses of the Fund represent payments made to FMO to reimburse FMO for the costs incurred on the programme.

21. Subsequent events

There have been no other significant subsequent events between the balance sheet date and the date of approval of these accounts which should be reported by the Fund.