Contingent liabilities

This item relates to credit-substitute guarantees and non-credit-substitute guarantees that are partly secured by blocked accounts for the same amount.

Credit substitute guarantees are guarantees to customers for loans provided to these customers by other banks. Non-credit substitute guarantees are guarantees to customers for all other obligations of these customers to third parties. For example:

• Obligations to purchase sustainable goods, such as wind turbines.

• Obligations to decommission equipment or reinstate property (mostly related to project finance provided by Triodos Bank).

During 2020, Triodos Bank has provided a guarantee with a maximum of EUR 20 million to Triodos Investment Management relating to a transaction that was made on behalf of an investment fund managed by Triodos Investment Management. Triodos Bank receives a fee of 0.1% per annum over the maximum guarantee.

The decrease of the credit substitute guarantees is mainly due to the conversion, by a client, of a large credit substitute guarantee into a loan agreement with Triodos Bank.

The decrease of the non-credit substitute guarantees is mainly due to the termination of a few large bank guarantees.

Contingent liabilities - Legal proceedings

Triodos Bank is involved in a number of legal proceedings. Management assesses the outcome of litigation matters, and takes provisions when expected losses with respect to such matters are more likely than not. Provisions are not recognised for matters against Triodos Bank for which an expected outflow of resources cannot be reliably estimated or that are not more likely than not to lead to an outflow of resources. Therefore, per year end Triodos Bank has a contingent liability due to legal proceedings in relation to Depository Receipts. For more information on the contingent liavility, refer to 19 Contingent liabilities .