Note from the Management Board

Welcome to FMO’s interim report 2025. The report reflects FMO’s work in the first six months of this year, showing our commitment to enabling entrepreneurs to increase inclusive and sustainable prosperity.

Overall financial results

Our financial results for the period ending 30 June 2025 show a net loss of €90 million (HY24 profit: €134 million). Over the same period, our regular result before tax1 amounted to €68 million (HY24: €54 million).

We report on our regular result before tax given the volatility of the net profit and loss due to e.g., changes in foreign exchange. The increase of the regular result compared to last year is explained by higher net interest income and dividend income, and relatively lower operating expenses. This shows a positive development of our underlying regular result before tax for the first half of 2025.

The net loss was mostly driven by the weakening of the US Dollar against the Euro, which affected the value of our private equity investments. Over the first half of 2025, the US Dollar weakened from 1.04 to 1.18 against the Euro. In addition, several other (local) currencies also depreciated against the Euro. These currency movements resulted in an unrealized foreign exchange (FX) loss of €217 million; €191 million related to the US Dollar and €26 million to other currencies. In 2024, the opposite occurred, when the US Dollar strengthened against the Euro (from 1.11 to 1.04), which helped boost our profit over 2024 by €116 million. At the same time, impairments on the loan portfolio show a positive result for the first half of 2025 following recoveries of previously written-off loans.

We aim to develop local financial markets in line with our mandate, which involves making loans and investments in foreign currency. We therefore accept this influence of e.g., the US Dollar exchange rate on our net profit and deliberately don’t hedge our foreign currency position in equity investments to reduce the volatility of the capital ratio. A depreciation of the reporting currency (Euro) can significantly affect the capital ratio since our assets, hence also the risk-weighted assets (RWA), are mainly denominated in foreign currencies. The long open FX position in the equity portfolio functions as a partial hedge for our regulatory capital ratios.

The common equity tier 1 (CET-1) ratio at the end of the reporting period was 24.0% (HY24 21.8%). This increase can be explained by among others the reduction in risk-weighted assets, primarily driven by two major factors: (i) FX movements, notably a depreciation in the US Dollar position, and (ii) the implementation of Basel IV standards. Additionally, the €163 million in profit from HY2 2024 contributed to the increase of our CET-1 ratio.

Overall impact results

As of 30 June 2025, our total committed portfolio was €13.5 billion, the same as in the first half of 2024. Of this, our Green-labelled total committed portfolio amounted to €5.1 billion (HY24: €4.9 billion) and our Reduced Inequalities (RI)-labelled total committed portfolio amounted to €5.5 billion (HY24: €4.5 billion). Compared to the end of 2024, our total committed portfolio figures show a decrease. Similar to the net profit/loss, this is mostly explained by the fluctuation of the US Dollar exchange rate: total committed portfolio increases when the US Dollar strengthens and decreases when it weakens.

Despite considerable uncertainty in our markets – outlined further in the Outlook section – we had a satisfactory first half of the year with respect to our total new investments realized, which were in line with the half year results presented last year (HY25 €830 million vs. HY24 €860 million). This is mainly driven by sector investments in Financial Institutions. Three-quarters of our total new investments thus far have been labelled RI. Through our local partners, we can reach small entrepreneurs – often women, youth, or those in rural areas. In addition, our sector investments in Agribusiness, Food & Forestry, and Energy are increasingly reaching underserved groups. The pipeline for investments in these sectors is well-developed, although challenges in the Energy market remain.

Updates on Leadership and Compliance

As Fatoumata Bouaré's second and final term as FMO's Chief Finance & Operations Officer neared its end, Fatou joined the European Bank for Reconstruction and Development (EBRD) in London in May 2025 as Vice President, Chief Risk Officer. Michael Jongeneel will serve as interim Chief Finance & Operations Officer until her successor is appointed.

On 30 June, Peter Maila ended his time as FMO’s Co-Chief Investment Officer to continue his career at Zvilo, a London-based supply chain finance company. The search for his successor is currently also underway. In the interim, FMO’s other Co-Chief Investment Officer, Huib-Jan de Ruijter will take over Peter’s responsibilities.

During the Annual General Meeting of shareholders on 23 April 2025, Rob Becker was appointed chair of FMO’s Supervisory Board, taking over from Dirk Jan van den Berg, who stepped down from the Supervisory Board after concluding his second and final term.

In August 2023 we reported that, as a result of late notifications of unusual transactions to the Dutch Financial Intelligence Unit (FIU-NL) in 2021 and 2022, DNB decided on enforcement measures. FMO is appealing these administrative measures.

Outlook

As we look ahead, we remain firmly committed to our mission and our Strategy 2030: Pioneer – Develop – Scale. At the same time, we are navigating an increasingly unstable and complex geopolitical landscape. Rising tensions, including the unfolding trade war and shifts in global power dynamics, bring both risks and uncertainties to the markets in which we operate. Various ongoing conflicts and wars continue to tragically impact the lives and livelihoods of millions, which deeply concerns us. We see it as our role to be countercyclical and focus on investing where it’s most needed and when others shy away.

We are closely monitoring these developments and evaluating their potential implications for our operations, our partners, and the entrepreneurs we support. Through strategic forecasting exercises, we are taking a forward-looking approach to identify and prepare for plausible and impactful long-term scenarios. To sharpen our perspective and ensure we remain grounded and well-informed, we actively engage with external experts, such as the Clingendael Institute of the Netherlands.

Responsibility statement

In accordance with Article 5:25d(2)(c) of the Dutch Financial Supervision Act (Wet op het Financieel Toezicht) we state that, to the best of our knowledge:

• The 2025 condensed consolidated interim financial statements give a true and fair view of the assets, liabilities, financial position and profit of FMO and its consolidated undertakings;

• This Interim Report 2025 includes a fair overview of the important events that have occurred during the first six months of the financial year, and their impact on the condensed consolidated interim financial statements 2025; and

• This Interim Report 2025 includes a description of the principal risks and uncertainties for the remaining six months of the financial year.

The Hague, August 13, 2025

Franca Vossen, Chief Risk Officer 
Huib-Jan de Ruijter, Co-Chief Investment Officer
Michael Jongeneel, Chief Executive Officer and Chief Finance and Operations Officer a.i.