A collective name referring to the four institutions (European Commission, ECB, IMF and ESM) responsible for monitoring a programme country’s compliance with the policy conditionality specified in the MoU.
An organisation, such as the European Stability Mechanism, which is established by and composed of sovereign countries. An intergovernmental organisation should be distinguished from a supranational organisation (e.g. the European Union) to whom countries cede some sovereign decision-making power in selected policy areas.
Institutions that provide financial support for economic and social development activities, or financial assistance to governments. International financial institutions include multilateral development banks (such as the World Bank or European Bank for Reconstruction and Development) and regional financial arrangements, such as the ESM.
The IRP is the process used by the ESM when it provides indirect bank recapitalisation loans. Unlike standard cash loans, loans to ESM countries for bank recapitalisation are disbursed in the form of ESM notes, and the IRP is the process that allows the ESM to issue them.
The process works as follows: the ESM issues notes to a counterparty (a bank belonging to the ESM Market Group which meets specific criteria), which subscribes for the notes and pays the issue price. The notes are then immediately repurchased by the ESM. Both transactions occur on the same day and at the same price. No gains or losses are linked to the process. The notes are then held by the ESM for later transfer. The notes are then transferred to the programme country, which uses them to inject capital in banks.