KFW

Financial Report 2024

Enabling growth

KFW

As a bank committed to responsibility, KfW promotes sustainable prospects for people, companies, the environment and society.

KfW is one of the world's leading promotional banks. It applies its decades of experience to improve economic, social and environmental living conditions across the globe on behalf of the Federal Republic of Germany and the federal states. In 2024, KfW provided promotional funds totalling EUR 112.8 billion for this purpose. It has no retail branches and does not hold any customer deposits. To fund its business activities, KfW raised around EUR 78.1 billion in the international capital markets in 2024, of which EUR 12.2 billion via “Green Bonds – Made by KfW”. This makes KfW one of the world’s largest issuers. In Germany, KfW Group has offices in Frankfurt am Main, Berlin, Bonn and Cologne. Its global network includes around 80 local and representative offices.

KfW Financial Report 2024

Key figures of KfW Group

Promotional business volume

| | 31 Dec. 2024
EUR in billions | 31 Dec. 2023
EUR in billions |
| --- | --- | --- |
| | 112.8 | 111.3 |

Key figures of the income statement

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Net interest income (before promotional expense) | 2,900 | 2,738 |
| Net commission income (before promotional expense) | 675 | 606 |
| Administrative expense (before promotional expense) | 1,658 | 1,547 |
| Operating result before valuation (before promotional expense) | 1,917 | 1,797 |
| Risk provisions for lending business | 39 | 165 |
| Net gains/losses from hedge accounting and other financial instruments at fair value through profit or loss | 150 | 114 |
| Net gains/losses from securities and investments and from investments accounted for using the equity method | 19 | 33 |
| Operating result after valuation (before promotional expense) | 2,126 | 2,109 |
| Net other operating income or loss (before promotional expense) | 18 | -14 |
| Profit/loss from operating activities (before promotional expense) | 2,145 | 2,095 |
| Promotional expense | 504 | 371 |
| Taxes on income | 239 | 165 |
| Consolidated profit | 1,402 | 1,559 |
| Consolidated profit before IFRS effects | 1,354 | 1,347 |
| Cost-income ratio (before promotional expense)¹⁾ | 46.4% | 46.3% |

¹⁾ Administrative expense (before promotional expense) in relation to adjusted income. Adjusted income is calculated from net interest income and net commission income (in each case before promotional expense).

KfW Financial Report 2024

Key figures of the statement of financial position

	31 Dec. 2024	31 Dec. 2023
	EUR in billions	EUR in billions
Total assets	545.4	560.7
Volume of lending	593.5	599.1
Volume of business	713.3	724.4
Equity	39.6	38.1
Equity ratio	7.3%	6.8%

Key regulatory figures

	31 Dec. 2024	31 Dec. 2023
	EUR in billions	EUR in billions
Risk position	126.2	131.4
Tier 1 capital	38.1	36.6
Regulatory capital	38.2	36.7
Tier 1 capital ratio	30.2%	27.9%
Total capital ratio	30.3%	27.9%

Employees of KfW Group

	2024	2023
	8,493	8,073

1) Average number of employees during the financial year, without interns

KfW Financial Report 2024

Financial Report > Contents

Letter from the Executive Board 6

Management of KfW Group 13

Report of the Board of Supervisory Directors 14

Members and tasks of the Board of Supervisory Directors 18

Corporate Governance Report 21

Combined non-financial report 27

General information 30

Environmental information 69

Social information 101

Governance information 136

Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA) 139

Independent auditor's assurance report 181

Combined management report 185

Basic information on KfW Group 187

Economic report 195

Risk report 209

Forecast and opportunity report 239

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code 246

Declaration of compliance 252

Non-financial statements of KfW Group 252

Consolidated financial statements 253

Consolidated statement of comprehensive income 256

Consolidated statement of financial position 257

Consolidated statement of changes in equity 258

Consolidated statement of cash flows 259

Consolidated notes 261

Attestations 362

Responsibility statement 363

Independent auditor's report 364

The figures in tables were calculated exactly and added up.

Figures presented may not add to totals because of independent rounding.

Actual zero amounts and amounts rounded to zero are presented as EUR 0 million.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Stefan B. Wintels, Chief Executive Officer

Letter from the Executive Board

Dear readers,

KfW experienced another very successful year in 2024. With new business volume at EUR 112.8 billion for the group, we once again slightly exceeded the prior-year volume and thus achieved the third-highest volume of new business in KfW's history.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Melanie Kehr

This result is remarkable given that the year was characterised by an increasingly apparent weakness in investment and growth in Germany, as well as immense economic, financial and socio-political challenges. As a globally networked economy, Germany is also strongly affected by the growing geopolitical tensions. Against this backdrop, KfW's favourable result reflects its particular strengths: its focus on the long term and continuity, its ability to react quickly to new requirements, and the success of the strategic course it has charted, based on a solid foundation of values.

An enormous volume of investment is necessary to make Germany future-proof. This cannot be sourced from public funds alone, and KfW is therefore challenged more than ever, in two different ways:

Firstly, we are enhancing the attractiveness of our promotional offering. In addition to the funds the Federal Government provides to us for interest rate reductions and grants, we use our own funds to improve the terms of our promotional programmes. For instance, we employed EUR 504 million of our own funds in 2024 to lower the interest rates on our loan products even further. This has been the largest amount in over ten years. We plan to maintain this promotional expense at least at this level in 2025 as well.

Secondly, we are deepening our commitment to boosting the capital market and mobilising private capital. The Capital Markets Conference on Energy Transition for Germany (CMCET) that we initiated and was held for the first time in July 2024 ignited more in-depth dialogue between policymakers and international investors on financing a sustainable energy infrastructure. The launch just a few weeks later of the WIN initiative coordinated by KfW represented a successful breakthrough in mobilising private capital for the growth capital ecosystem. Not least, we are supporting the German financial sector's initiative to revive the European securitisation market – another key component in mobilising private capital.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Katharina Herrmann

Climate action remains a core obligation

As a bank committed to responsibility, KfW continues to support climate action and the related national and international goals. Climate action is not only an obligation to future generations but also an important instrument to ensure Germany's competitiveness. We have committed around EUR 350 billion to climate and environmental financing since 2017, of which around EUR 30 billion in 2024 alone.

Domestic promotional business characterised by private investment in sustainable transformation

Domestic promotional business recorded slight growth to EUR 79 billion in 2024. The volume of new promotional business in the building sector – for private, municipal and commercial customers – proved the main growth driver, increasing by 15.9% to EUR 23.7 billion. The volume of EUR 22.4 billion in the Private Clients segment considerably exceeded the prior-year level. The focus in this segment was on promoting energy efficiency and renewable energy. The result clearly shows that private households are on board with the transformation.

Business volume in the SME Bank segment, by contrast, declined to EUR 13.4 billion. The main factors behind this were a weak economic environment and a marked reluctance to invest on the part of companies, an overall high level of interest rates, and state aid legislation limiting KfW's options in drawing up terms.

In addition, KfW executed transactions directly mandated by the Federal Government totalling EUR 33.2 billion. This corresponds to 42% of total domestic new business. In contrast to previous years, the focus has shifted from crisis aid to financing infrastructure projects crucial to a sustainable transformation. The EUR 24 billion commitment for developing the hydrogen core network constituted the largest component. KfW also committed EUR 8.5 billion for follow-on financing to secure Germany's energy supply.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Christiane Laibach

International activities to bolster Germany as a business location

KfW is active around the globe through its business sectors KfW IPEX-Bank, KfW Development Bank and DEG. This puts KfW in a unique strategic position to strengthen Germany's competitiveness and resilience. In its international business, KfW stands by the side of large German industrial companies, supports German SMEs and represents German interests vis-à-vis governments and partners with whom it has been working for decades. The focus here also remains strongly on the transformation of the economy and on energy and climate. KfW's international business units have achieved new business totalling EUR 34.2 billion in 2024.

New commitments totalling EUR 23.9 billion put KfW IPEX-Bank, responsible for the business sector Export and project finance, close to the record volume of the previous year of EUR 24.2 billion. The promotion of developing countries and emerging economies achieved a total commitment volume of EUR 10.3 billion (2023: EUR 10.9 billion). Almost EUR 7.8 billion (2023: EUR 9.0 billion) of this amount was attributable to KfW Development Bank. As a partner to private enterprises in developing countries and emerging economies, KfW's subsidiary DEG succeeded once again in clearly surpassing its record volume of the previous year. DEG provided EUR 2.5 billion of own funds (2023: EUR 1.9 billion) for private investments in developing countries and emerging economies under globally challenging conditions. Moreover, it mobilised EUR 583 million in private capital.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Bernd Loewen

KfW Capital boosts Germany's VC ecosystem

Commitments in the business sector KfW Capital totalled around EUR 1.6 billion in 2024 (2023: EUR 2.1 billion). The year-on-year decline resulted, among other things, from the subdued commitments of the European Investment Fund (EIF) in connection with the Growth Facility as a component of the Future Fund managed by KfW Capital. KfW Capital has meanwhile invested EUR 2.5 billion in 132 VC funds and has indirectly co-financed 2,400 start-ups in this way. On average, VC funds invest close to four times the amount of capital provided by KfW Capital in start-ups and innovative companies in Germany. KfW Capital thus makes a powerful contribution to Germany as an innovation hub.

Consolidated profit considerably above expectations

The earnings position of KfW Group in 2024 was satisfactory given the persistent challenging geopolitical and macroeconomic environment, and with a consolidated profit of EUR 1.4 billion, it was considerably above expectations. The earnings position was largely characterised by the very strong operating result, which, at EUR 504 million, enabled the highest promotional expense on record of the past ten years.

KfW Financial Report 2024

Financial Report > Letter from the Executive Board

Dr Stefan Peiß

Risk-bearing capacity remains very high

The regulatory capital ratios at year-end 2024, with a total capital ratio of 30.3% and a (common equity) tier 1 capital ratio of 30.2%, remained at a healthy level and significantly above the overall capital requirements. The rise of around 2.4 percentage points year-on-year was due to both a reduction in the total risk exposure amount and to an increase in regulatory capital compared to the previous year (31 December 2023: total capital ratio and [common equity] tier 1 capital ratio 27.9%). The capital ratios are expected to remain high for 2025 despite the more capital-intensive CRR III rules.

Business policy priorities in 2025

Given the political, social and economic challenges facing Germany, we have set three priority areas for 2025.

We are placing a greater focus on Germany as a business location and will keep an even closer watch on our activities to determine whether they reinforce Germany's competitiveness.
As a responsible bank, we are committed to climate action as a central task. This is not only an obligation to future generations but also an important instrument to ensure Germany's competitiveness.
We reliably support our clients and partners and strive to effectively fulfil our role as partner to the Federal Government.

KfW Financial Report 2024

KfW's role continues to develop

The experiences of the past year have shown us that reinforcing Germany's competitiveness and financing a sustainable transformation demand a reinterpretation of KfW's role. It needs more than just providing funding.

What sets us apart is our unique position: close and stable networking with policymakers, our national and international financing partners, companies and their associations, municipalities and consumers, and last but not least, the global financial markets. This extends

our role to that of an advisor on overall conditions, an enabler of customised solutions and, most notably, as driving force for new initiatives.

In order to fulfil this role as a "bank committed to responsibility" in times of major challenges, global conflicts and profound upheavals, it is always useful to remember our roots. They lie in the social market economy, European unification and in upholding a rules-based world order, and they will continue to support and guide us in the years ahead.

Stefan B. Wintels
Chief Executive Officer

Katharina Herrmann

Melanie Kehr

Christiane Laibach

Bernd Loewen

Dr Stefan Peiß

KfW Financial Report 2024

Financial Report > Executive Board, Directors and Managing Directors of KfW Group

Management of KfW Group

Executive Board

Stefan Wintels (CEO)
Katharina Herrmann
Melanie Kehr

Christiane Laibach
Bernd Loewen
Dr Stefan Peiß (CRO)

Directors

Tim Armbruster
Dr Anke Brenken
Jörg Brombach
Cecilia Fernández de Córdova
Dr Thomas Duve (interim since 01/01/2025)
Andreas Fichelscher
Eberhard Fuchs (interim from 01/05/2024 to 31/12/2024)
Dr Lutz-Christian Funke
Helmut Gauges (until 31/12/2024)
Dr Karsten Hardraht
Dr Carsten Heineke (since 01/07/2024)
Dr Andrea Hauser
Christoph Johnscher (from 01/04/2025)
Detlev Kalischer (until 31/03/2025)
Verena Köttker
Christian Krämer

Dirk Kuhmann
Dr Stephan Lauer
Dr Susanne Maurenbrecher
Jörg Menzel
Andreas Müller
Stephan Opitz
Gaetano Panno
Dr Ralf Prinzler (until 30/06/2024)
Wolfgang Reuß
Ingo Schumann (from 01/01/2025)
Matthias Schwenk
Mirko Sedlacek
Dr Annette Sölter (since 01/07/2024)
Birgit Spors
Robert Szwedo
Klaus Weirich (until 31/12/2024)
Eva Witt

Members of the Management Board of KfW IPEX-Bank GmbH

Belgin Rudack (CEO and CFO) (CFO until 31/12/2024)
Dr Velibor Marjanovic
Claudia Schneider (CRO)
Andreas Ufer

KfW IPEX-Bank is responsible for the export and project finance business sector. Since the beginning of 2008, it has been a legally independent subsidiary of KfW which is subject to the German Banking Act (Kreditwesengesetz – "KWG") and banking supervisory regulations.

Members of the Management Board of DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH

Roland Siller (CEO)
Monika Beck
Joachim Schumacher

DEG was founded in 1962 and has been a wholly-owned subsidiary of KfW since 2001. DEG is one of the largest European development finance institutions for long-term project and corporate financing. It has been financing and structuring investments by private companies in developing and emerging market countries for more than 60 years.

Members of the Management Board of KfW Capital GmbH & Co. KG

Dr Jörg Goschin
Alexander Thees

KfW Capital has been on the market as a venture capital fund investor since 2018. As a wholly-owned subsidiary of KfW, it invests in VC funds with support of the German Federal Government, which in turn finance start-ups and innovative technology companies in Germany.

KfW Financial Report 2024

Financial Report > Report of the Board of Supervisory Directors

Report of the Board of Supervisory Directors

Meetings of the Board of Supervisory Directors

The Board of Supervisory Directors and its committees constantly monitored the conduct of KfW's business activities and the management of its assets. It has taken the necessary decisions on the provision of financing and the conduct of other business in accordance with the conditions set forth in the KfW Law and Bylaws. The Board of Supervisory Directors, the Presidial and Nomination Committee and the Remuneration Committee each met three times in 2024 for this purpose; the Audit Committee met twice and the Risk and Credit Committee seven times. Some of these meetings were held virtually in the form of video conferences.

Dr Jörg Kukies,
Federal Minister of Finance

At the meetings, the Board of Supervisory Directors acknowledged the information provided by the Executive Board on:

KfW's 2023 annual and consolidated financial statements;
the business activities and current developments in each of KfW's business sectors, including KfW IPEX-Bank, DEG and KfW Capital;
the group's net assets, its general financial, earnings and risk position, and on sensitive risk areas in particular;
banking supervisory issues relating to KfW, current consultations with the banking supervisory authorities, compliance with regulatory capital requirements, audits completed and ongoing and the resulting measures, as well as potential effects of future regulatory changes;
the measures to implement the KfWplus strategy and further develop the corporate culture; and
funding activities on the capital market, including issuance of crypto bonds.

In addition, the Board of Supervisory Directors addressed the following key issues based on the reports submitted by the Executive Board on the individual business sectors:

In domestic business, corporate financing was characterised by a marked decrease in commitment volume due to the inverted yield curve and the EU reference rate limiting offerings without state aid. Domestic promotion also focused on housing-related promotional programmes, including the new heating promotion. KfW launched the WIN initiative to leverage private venture capital, hosted an investor conference on the energy transition and organised the roundtable on district heating.
Regarding activities for promotion of developing countries and emerging economies, the Board of Supervisory Directors discussed the situation in the Gaza Strip and the Financial Cooperation commitment there as well as KfW's involvement in Ukraine. It also considered KfW Development Bank's role in financing climate action and biodiversity measures as well as in strengthening global partnerships (including a co-financing agreement with the World Bank).
The international export and project finance business sector continued to focus on supporting German investors in the reporting year and, in particular, preparing KfW IPEX-Bank for its supervision by the ECB effective from the start of the year.

KfW Financial Report 2024

Financial Report > Report of the Board of Supervisory Directors

The Board of Supervisory Directors was informed at the meetings as well as every quarter, in writing, of the group's net assets, financial and earnings position, its risk situation, the development of its promotional business, and Internal Auditing's activity. The Executive Board also kept the Chair of the Board of Supervisory Directors and his deputy informed of key developments at the bank between meetings.

The Board of Supervisory Directors discussed key aspects of the business strategy and approved the planning for 2025. It acknowledged the multi-year business strategy, the risk strategy, the new digital operational resilience (DOR) strategy for the first time, the IT strategies for the group and the individual group companies.

Each member of the Board of Supervisory Directors is obliged to inform the Chair of the Board of Supervisory Directors or the relevant committee about potential conflicts of interest before a resolution is made. A total of 13 cases of potential or actual conflicts of interest arose in the Risk and Credit Committee during the reporting period; this resulted in the relevant members abstaining from voting or refraining from participating in resolutions.

Six members of the Board of Supervisory Directors attended fewer than half of the board meetings in the reporting year. One member of the Presidial and Nomination Committee attended fewer than half of the meetings as did one member of the Remuneration Committee. Three members were absent from more than half of the meetings of the Risk and Credit Committee. Two members attended fewer than half of the meetings of the Audit Committee.

Members of the Board of Supervisory Directors attended seven training events and four individual training sessions in 2024 to gain and maintain the expertise required in accordance with the German Banking Act.

Committees of the Board of Supervisory Directors

In exercising its responsibilities prescribed in the bylaws, the Presidial and Nomination Committee discussed Executive Board matters. It recommended that the Board of Supervisory Directors reappoint the Executive Board members with responsibility for group management and sustainability (Chief Executive Officer), for risk management and controlling, and for international finance. At the recommendation of the Remuneration Committee, the Presidial and Nomination Committee approved the changes made to the remuneration of one Executive Board member. In addition, the Presidial and Nomination Committee specified the orientation of KfW's basic business policy in line with the strategic guidelines for 2025. It conducted the regular evaluation of the KfW bodies, assessed the professional qualifications and composition of its members and made appropriate recommendations to the Board of Supervisory Directors. The Presidial and Nomination Committee regularly discussed the issue of dealing with potential conflicts of interest at Executive Board and Board of Supervisory Directors level. It was also informed about banking supervisory issues, KfW Stiftung and legal disputes.

The Remuneration Committee discussed remuneration issues in the context of Executive Board matters and made recommendations, among others, to the Presidial and Nomination Committee on the remuneration-relevant components of Executive Board contracts in the context of Executive Board reappointments. The Remuneration Committee was informed via reports in accordance with the Remuneration Ordinance for Institutions (Institutsvergütungsverordnung – "IVV") of matters including the annual risk analysis to identify risk takers. As part of this risk analysis, KfW, both as an individual institution and at group level, has to identify staff members whose work could have a material impact on the risk profile of the institution/the group. The Remuneration Committee acknowledged the modifications to the 2019 pension scheme. The group-wide remuneration strategy and the assessment base for variable employee remuneration were also discussed.

The Risk and Credit Committee reviewed, among other matters, the commitments, equity investments, and intra-entity loans that must be presented to it under the KfW Law and KfW Bylaws as well as the scope of borrowings required by KfW for its funding and the related swap transactions necessary for hedging. It discussed the risk situation, the effectiveness of the risk management system, and the adequacy of reporting on strategy and risk.

KfW Financial Report 2024

Financial Report > Report of the Board of Supervisory Directors

It also dealt with KfW's exposure in various countries, regions and sectors, the development and assessment of political risks in relevant areas of activity, measures to further develop the risk culture, stress testing and market price risks, the risk profile of financing in certain sectors and the remuneration system, with a particular focus on the IVV.

Furthermore, it discussed in detail the situation in the Gaza Strip and KfW Development Bank's involvement in Palestinian territories. The outcome of the US presidential elections and the impact on transatlantic relations were considered too, as were developments in France following the parliamentary elections.

The committee also conversed on multiple occasions about ESG and information security risks and measures to mitigate them. The regulatory capital requirements of KfW and the requirements under Basel IV were also discussed. And lastly, the committee debated the risk strategy, including capital planning for the next few financial years, and the new DOR strategy.

The Audit Committee addressed the accounting process, KfW's net assets, financial and earnings position, the reports by Internal Auditing and Compliance and the annual financial statements of KfW Group 2023. It made corresponding recommendations to the Board of Supervisory Directors for the approval of the annual financial statements 2023 and the appointment of the auditor for 2025. Based on information supplied by the Executive Board, it discussed the efficiency of the risk management system, the internal control system (ICS) and the internal audit system. In addition, it addressed auditor independence and audit quality, determined focal points of the 2024 financial statements audit and discussed the initial results of the 2024 financial statements audit (audit report part I). The committee approved the audit plan of the Internal Auditing department for 2025. It monitored banking supervisory issues and closely reviewed the banking supervisory assessments, along with the resulting measures and projects to remedy the findings, and was informed of the future sustainability reporting in accordance with CSRD and of the further development of KfW's internal control system. Lastly, the committee dealt with current developments in IT.

The committee chairpersons reported to the Board of Supervisory Directors regularly on the work of the committees.

Changes on the boards

At the proposal of the Presidial and Nomination Committee, the Board of Supervisory Directors reappointed Dr Stefan Peiß to the Executive Board on 21 March 2024 with effect from 1 January 2025, reappointed Christiane Laibach to the Executive Board on 27 June 2024 with effect from 1 June 2025, and reappointed Stefan Wintels to the Executive Board on 5 December 2024 with effect from 1 October 2025.

In accordance with Article 7 (1) number 1 of the KfW Law, in my capacity as Federal Minister of Finance, I assumed the Chair of the Board of Supervisory Directors for 2025 from my colleague Dr Robert Habeck, Federal Minister for Economic Affairs and Climate Action.

Dr André Berghegger, Stefan Evers, Dr Heiko Geue and Dr Helena Melnikov joined the Board of Supervisory Directors with effect from 1 January 2025. The German Bundesrat also appointed Christian Piwarz as a member of the Board of Supervisory Directors on 14 February 2025 with effect from 1 January 2025. The Bundestag appointed Olav Gutting and Dr Thorsten Rudolph as new members of the Board of Supervisory Directors effective 22 February 2024 and 11 April 2024, respectively. Dr André Berghegger and Achim Post stepped down from the Board of Supervisory Directors during the year and Senator Dr Andreas Dressel, Mayor and Senator Björn Fecker, Prof. Dr Hans-Günter Henneke, Minister Michael Richter and Dr Martin Wansleben at the end of 2024.

The following members stepped down and were reappointed as scheduled with effect from 31 December 2024: Katharina Beck, Verena Hubertz, Dr Dirk Jandura, Andrea Kocsis and Holger Schwannecke.

The Board of Supervisory Directors would like to thank all the members who stepped down for their work.

KfW Financial Report 2024

Financial Report > Report of the Board of Supervisory Directors

Annual financial statements

Deloitte GmbH, which was appointed auditor for financial year 2024, has audited the annual financial statements, consolidated financial statements and the combined management report, all of which were prepared as of 31 December 2024 by the Executive Board, and issued an unqualified auditor's report thereon. The annual financial statements of KfW were prepared in accordance with the provisions of the German Commercial Code (HGB), and the consolidated financial statements were prepared in accordance with International Financial Reporting Standards ("IFRS") as applicable within the European Union.

As stipulated in Article 9 (2) of the KfW Law, the Board of Supervisory Directors approved the financial statements and the consolidated financial statements, both of which were prepared by the Executive Board, at its meeting on 2 April 2025, following a recommendation by the Audit Committee.

Frankfurt am Main, 2 April 2025

The Board of Supervisory Directors

Chair

KfW Financial Report 2024

Financial Report > Members and tasks of the Board of Supervisory Directors

Members and tasks of the Board of Supervisory Directors

The Board of Supervisory Directors supervises the conduct of KfW's business and the administration of its assets. It approves, among other things, the annual financial statements. The Board of Supervisory Directors consists of 37 members. In the year under review, the Chair was held by the Federal Minister for Economic Affairs and Climate Action, and the Deputy Chair by the Federal Minister of Finance.

Dr Robert Habeck

Federal Minister for Economic Affairs and Climate Action
Chair
(1 January – 31 December 2024)
Deputy Chair
(since 1 January 2025)

Christian Lindner

Federal Minister of Finance
Deputy Chair
(1 January 2024 – 7 November 2024)

Dr Jörg Kukies

Federal Minister of Finance
Deputy Chair
(7 November 2024 – 31 December 2024)
Chair
(since 1 January 2025)

Annalena Baerbock

Federal Foreign Minister

Katharina Beck

Member of the German Bundestag
Member appointed by the German Bundestag

Dr André Berghegger

Former member of the German Bundestag
Member appointed by the German Bundestag
(until 20 February 2024)
Managing Director of the German Association of Towns and Municipalities
Representative of municipalities
(since 1 January 2025)

Volker Bouffier

Former Minister President of the State of Hesse
Member appointed by the German Bundesrat

Dr Andreas Dressel

Senator for Finance of the Free and Hanseatic City of Hamburg
Member appointed by the German Bundesrat
(until 31 December 2024)

Stefan Evers

Mayor and Senator for Finance of the State of Berlin
Member appointed by the German Bundesrat
(since 1 January 2025)

Yasmin Fahimi

Chair of the German Trade Union Confederation (DGB)
Representative of the trade unions

Björn Fecker

Mayor and Senator for Finance of the Free Hanseatic City of Bremen
Member appointed by the German Bundesrat
(until 31 December 2024)

Robert Feiger

Chair of the Federal Executive Committee of the IG Bauen-Agrar-Umwelt trade union (IG Bau)
Representative of the trade unions

Dr Heiko Geue

Minister of Finance of the State of Mecklenburg-Vorpommern
Member appointed by the German Bundesrat
(since 1 January 2025)

Tanja Gönner

Director General of the Federation of German Industries (BDI)
Representative of industry

Olav Gutting

Member of the German Bundestag
Member appointed by the German Bundestag
(since 22 February 2024)

KfW Financial Report 2024

Financial Report > Members and tasks of the Board of Supervisory Directors

Gerald Heere
Minister of Finance of the State of Lower Saxony
Member appointed by the German Bundesrat

Prof. Dr Hans-Günter Henneke
Managing Member of the Executive Committee of the Federation of German Districts
Representative of municipalities (until 31 December 2024)

Marion Höllinger
Member of the Board of Directors of the Association of German Banks (BdB)
Representative of the commercial banks

Verena Hubertz
Member of the German Bundestag
Member appointed by the German Bundestag

Harald Hübner
Ministerial Director at the Bavarian State Ministry of Finance and Regional Identity
Member appointed by the German Bundesrat

Dr Dirk Jandura
President of the Federation of German Wholesale, Foreign Trade and Services (BGA).
Representative of trade

Andrea Kocsis
Deputy Chair of ver.di – United Services Trade Union
Representative of the Trade Unions

Stefan Körzell
Member of the Executive Board of the German Trade Union Confederation (DGB)
Representative of the trade unions

Ulrich Lange
Member of the German Bundestag
Member appointed by the German Bundestag

Steffi Lemke
Federal Minister for the Environment, Nature Conservation, Nuclear Safety and Consumer Protection

Dr Helena Melnikov
Chief Executive of the German Chamber of Commerce and Industry (DIHK)
Representative of industry (since 1 January 2025)

Rainer Neske
Chair of the Board of Managing Directors at Landesbank Baden-Württemberg (LBBW)
Representative of industrial credit

Dr Marcus Optendrenk
Minister of Finance of the State of North Rhine-Westphalia
Member appointed by the German Bundesrat

Dr Bettina Orlopp
Chief Executive Officer of Commerzbank AG
Representative of the mortgage banks

Cem Özdemir
Federal Minister of Food and Agriculture

Christian Piwarz
Saxon State Minister of Finance
Member appointed by the German Bundesrat (since 1 January 2025)

Achim Post
Member of the German Bundestag
Member appointed by the German Bundestag (until 22 March 2024)

Daniel Quinten
Member of the Board of Managing Directors of the National Association of German Cooperative Banks (BVR)
Representative of the cooperative banks

KfW Financial Report 2024

Financial Report > Members and tasks of the Board of Supervisory Directors

Prof. Dr Ulrich Reuter
President of the German Savings Banks Association (DSGV)
Representative of the savings banks

Michael Richter
Minister of Finance of the State of Saxony-Anhalt
Member appointed by the German Bundesrat
(until 31 December 2024)

Dr Thorsten Rudolph
Member of the German Bundestag
Member appointed by the German Bundestag
(since 11 April 2024)

Joachim Rukwied
President of the German Farmers' Association (DBV)
Representative of agriculture

Frank Schäffler
Member of the German Bundestag
Member appointed by the German Bundestag

Jan Wenzel Schmidt
Member of the German Bundestag
Member appointed by the German Bundestag

Svenja Schulze
Federal Minister for Economic Cooperation and Development

Holger Schwannecke
Secretary General of the German Confederation of Skilled Crafts (ZDH)
Representative of the skilled crafts

Dr Martin Wansleben
Chief Executive of the Association of German Chambers of Commerce and Industry (DIHK)
Representative of industry
(until 31 December 2024)

Dr Kai H. Warnecke
President
Haus & Grund Germany
Representative of the housing industry

Dr Volker Wissing
Federal Minister for Digital and Transport and Federal Minister of Justice

KfW Financial Report 2024

Financial Report > Corporate Governance Report

Corporate Governance Report

As the promotional bank of the Federal Republic of Germany, KfW has committed itself to making responsible and transparent action comprehensible. The Executive Board and the Board of Supervisory Directors of KfW recognise the Public Corporate Governance Code (Public Corporate Governance Kodex – "PCGK") of the Federal Republic of Germany. A declaration of compliance with the recommendations of the PCGK was issued for the first time on 6 April 2011. Since then, any potential deviations have been disclosed and explained on an annual basis.

KfW is a public-law institution under the Law Concerning KfW (KfW Law). The KfW Law sets out KfW's main structural features. For example, KfW does not have a general shareholders' meeting. The shareholders are represented on the Board of Supervisory Directors of KfW and exercise control and shareholder functions (e.g. approval of the financial statements and adopting resolutions concerning the KfW Bylaws). The number of members, composition and duties of the Board of Supervisory Directors are set out in the KfW Law. The KfW Law also provides that the Board of Supervisory Directors is subject to legal supervision by the Federal Ministry of Finance in consultation with the Federal Ministry for Economic Affairs and Climate Action as well as to direct control of the Federal Audit Office (Bundesrechnungshof). The KfW Law in conjunction with the Regulation concerning key banking supervision standards under the German Banking Act (Gesetz über das Kreditwesen – "KWG") to be declared applicable by analogy to KfW and supervision of compliance to these standards to be assigned to the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – "BaFin") (KfW Regulation), dated 20 September 2013 (last amended 27 December 2024), further stipulates that KfW is subject to supervision by BaFin in collaboration with the Bundesbank.

Declaration of compliance

The Executive Board and Board of Supervisory Directors of KfW hereby declare: "Since the last declaration of compliance issued on 21 March 2024, the recommendations of the PCGK have been and will be fulfilled to the extent applicable to KfW as a public-law institution with the exception of the following derogations."

D&O insurance excess

KfW has taken out D&O insurance for members of the Executive Board and the Board of Supervisory Directors, which – in derogation of clause 4.3.2 of the PCGK – does not include any policy excess.

Delegation to committees

The KfW Law sets out the size of the Board of Supervisory Directors at 37 members. To ease the work of the Board of Supervisory Directors, committees more specialised in the subject matter and flexible in terms of time are in place, and whose establishment is prescribed by law. In some cases, the committees not only prepare the decisions of the Board of Supervisory Directors but also – in derogation of clause 6.1.7 of the PCGK – make final decisions. This is done for reasons of practicality and efficiency. Pursuant to the KfW Bylaws, the Presidial and Nomination Committee and the Risk and Credit Committee have final decision-making authority. More details are provided in the Board of Supervisory Directors section under the descriptions of the respective committees.

In derogation of clause 5.4.3 of the PCGK, the Chair of the Presidial and Nomination Committee accepts information on Executive Board member conflicts of interest, in lieu of the Board of Supervisory Directors. Moreover, the Chair of the Presidial and Nomination Committee approves secondary employment of Executive Board members instead of the Chair of the Board of Supervisory Directors, in derogation of clause 5.4.4 of the PCGK.

Meetings of the supervisory body

In accordance with section 1 (1) sentence 2 of the rules of procedure of the Board of Supervisory Directors and its committees, the KfW Board of Supervisory Directors holds at least three instead of four meetings per calendar year, in derogation of clause 6.5 of the PCGK. This meeting frequency has proven to be successful in the past, was agreed with the legal supervisor and continues to be deemed appropriate. Due to the statutory size of the Board of Supervisory Directors and delegation of duties to the committees created, some of which involve final decision-making, three meetings per calendar year are deemed sufficient.

KfW Financial Report 2024

Financial Report > Corporate Governance Report

Cooperation between Executive Board and Board of Supervisory Directors

The Executive Board and Board of Supervisory Directors work closely together for the benefit of KfW. The Executive Board maintains regular contact with the Chair and Deputy Chair of the Board of Supervisory Directors and discusses important issues concerning the management of the bank and strategy with them. The Chair of the Board of Supervisory Directors informs the Board of Supervisory Directors of serious issues and, if necessary, convenes an extraordinary meeting.

During the reporting year, the Executive Board informed the Board of Supervisory Directors about all relevant matters regarding the bank's strategies, planning, development of business, profitability, risk situation, risk management, compliance, remuneration strategy, IT strategy, financial position, sustainable corporate governance and its implementation and results including relevant information on the group companies, transactions of particular importance to the profitability or liquidity of the company and changes in the economic environment significant to the company.

Executive Board

The Executive Board is responsible for managing the activities of KfW pursuant to the KfW Law, the KfW Regulation, the KfW Bylaws and the procedural rules for the Executive Board. A schedule of responsibilities stipulates business responsibilities within the Executive Board. The Executive Board requires the prior approval of the Presidial and Nomination Committee regarding significant changes to responsibilities within the Executive Board.

Responsibilities were distributed as follows with effect from 1 January 2024 until 31 December 2024:

Stefan Wintels – Chief Executive Officer, General Secretariat, Group Communications and Brand Management, Group Development and Economics, Legal, Internal Auditing, Financial Markets, and Chief Sustainability Officer of KfW;
Katharina Herrmann – Digital Sales & Customer Services (until 31 May 2024 Domestic Marketing and Digital Channels), Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients), Mittelstandsbank & Privatkunden (SME Bank & Private Clients) and KfW Capital;
Melanie Kehr – Information Technology, Transaction Management, and Operations;
Christiane Laibach – KfW Development Bank, DEG, and Export and project finance (KfW IPEX-Bank);
Bernd Loewen – Finance (until 30 November 2024 Accounting), Organisation and Consulting, Human Resources and Central Services;
Dr Stefan Peiß – Risk Controlling, Credit Risk Management and Compliance.

Executive Board members are obliged to act in the best interests of KfW, may not consider personal interests in their decisions, and are subject to a comprehensive non-competition clause during their employment with KfW. Executive Board members must inform their Board colleagues of any conflicts of interests prior to adopting resolutions and disclose them to the Chair of the Presidial and Nomination Committee without delay.

As of 31 December 2024, the proportion of women on the Executive Board was 50%, and the proportion of women in senior management (i.e. the two management levels below the Executive Board) was 38.6%.

Board of Supervisory Directors

The Board of Supervisory Directors supervises and advises the Executive Board in the management of the bank.

In accordance with the KfW Law, the Board of Supervisory Directors consists of 37 members. In accordance with the law, seven Federal Ministers are members of the Board of Supervisory Directors. In addition, the German Bundestag and Bundesrat appoint seven members each. The remaining members of the Board of Supervisory Directors are appointed by the Federal Government after consultation with stakeholder groups. The Federal Minister of Finance and the Federal Minister for Economic Affairs and Climate Action alternate on a yearly basis as Chair of the Board of Supervisory Directors. The Chair of the Board of Supervisory Directors in the reporting year was Federal Minister Dr Robert Habeck from 1 January 2024 to 31 December 2024. There were ten female members on the Board of Supervisory Directors as of 31 December 2024.

KfW Financial Report 2024

Financial Report > Corporate Governance Report

No member of the Board of Supervisory Directors may have business or private dealings with KfW or its Executive Board members that are based on a substantial and more than temporary conflict of interests. Each member of the Board of Supervisory Directors informs the Chair of the Board of Supervisory Directors or of the relevant committee of conflicts of interest before a resolution is adopted.

Six members of the Board of Supervisory Directors attended fewer than half of the board meetings in the reporting year.

Committees of the Board of Supervisory Directors

The Board of Supervisory Directors has created four committees in accordance with Section 25d KWG in order to increase efficiency in performance of its duties. They are listed below with their primary responsibilities, stipulated in the KfW Bylaws.

The Presidial and Nomination Committee is responsible for all business and corporate policy matters, as well as all legal and administrative matters. It approves important administrative matters of the Executive Board and legal matters of the Chair of the Board of Supervisory Directors with Executive Board members and makes urgent decisions on pressing matters within its scope of responsibility. The Presidial and Nomination Committee is also responsible for handling nominations. It draws up job descriptions with candidate profiles for Executive Board positions, identifies candidates, and proposes appointments to the Board of Supervisory Directors. It draws up job descriptions with candidate profiles for positions on the Board of Supervisory Directors, and can support the government bodies which make the appointments in selecting the individuals. It also ensures with the Executive Board that long-term succession planning is in place for the latter. The Presidial and Nomination Committee's tasks also include advising and adopting resolutions on the remuneration system for the Executive Board, including in respect of contract components and their regular review, notwithstanding the tasks of the Remuneration Committee. The Board of Supervisory Directors, on the other hand, decides on the basic structure of the Executive Board remuneration system. The Presidial and Nomination Committee regularly (at least once a year) assesses the structure, size, composition and performance of the Executive Board and Board of Supervisory Directors and makes recommendations to the Board of Supervisory Directors. It also regularly (at least once a year) assesses the knowledge, skills and experience of the individual members of the Executive Board and Board of Supervisory Directors and of each body as a whole. It sets objectives for promotion of representation of the underrepresented gender on the Board of Supervisory Directors, develops a strategy to achieve them, and reviews the rules for selecting and appointing individuals to KfW senior management, providing recommendations to the Executive Board in this regard.

The Remuneration Committee deals with remuneration matters. It deals in particular with the appropriate structure of the remuneration system for the KfW Executive Board and employees and advises the Presidial and Nomination Committee on remuneration of the Executive Board members. It also monitors the proper involvement of the internal control and all other areas of relevance in structuring the remuneration systems.

The Risk and Credit Committee is responsible for advising the Board of Supervisory Directors on risk issues, such as, in particular, the group's overall risk tolerance and strategy. It examines whether the incentives offered by the remuneration system take into account KfW's risk, capital and liquidity structure as well as the probability and due dates of income. The Risk and Credit Committee is also responsible for handling credit matters, loans and financial guarantees without collateral, and approval of funding through the issue of bonds or taking out loans in foreign currencies and via KfW swap transactions, in some cases making final decisions, i.e. without involving the Board of Supervisory Directors. It is standard procedure at banks for the final decision in such matters to be taken by a committee. It serves to accelerate and bundle expertise in the committee.

The Audit Committee is responsible for accounting and risk management issues. In particular, it deals with monitoring the accounting process, the effectiveness of the internal controlling system, the internal audit system and risk management system, auditing the annual and consolidated financial statements, the required independence of the auditor, the quality of the audit, determining the focus areas of the audit, and monitoring the prompt elimination by the Executive Board of any deficiencies found by the auditor, Internal Auditing or financial regulators. The Audit Committee makes recommendations to the Board of Supervisory Directors concerning its approval of the annual and consolidated financial statements.

KfW Financial Report 2024

Financial Report > Corporate Governance Report

The chairs of the committees report to the Board of Supervisory Directors on a regular basis.

The Board of Supervisory Directors provides information about its work and that of its committees during the reporting year in its report. An overview of the members of the Board of Supervisory Directors and its committees is available on KfW's website.

As of 31 December 2024, the proportion of women on the Board of Supervisory Directors was 27%.

Shareholders

The Federal Government owns 80% of KfW's share capital, the German federal states 20%. In accordance with Article 1a of the KfW Law, the Federal Republic of Germany is liable for certain of KfW's liabilities. There is no profit distribution. The KfW Law does not require a general shareholders' meeting; the Board of Supervisory Directors performs the function of a general shareholders' meeting.

Supervision

In accordance with Article 12 of the KfW Law, KfW is subject to legal supervision by the Federal Ministry of Finance in consultation with the Federal Ministry for Economic Affairs and Climate Action. The supervising authority has the power to take all measures necessary to ensure that KfW operates its business activities in accordance with the law, the KfW Bylaws and other rules and regulations.

KfW is not considered a credit institution within the meaning of Section 2 (1) no. 2 KWG. The KfW Regulation dated 20 September 2013 (last amended 27 December 2024), however, declares central banking supervision regulations henceforth applicable by analogy to KfW, and subjects KfW to supervision by BaFin in collaboration with the Bundesbank regarding KfW's compliance with these regulations.

The group companies KfW IPEX-Bank and DEG are, on the other hand, credit institutions within the meaning of the KWG. KfW IPEX-Bank is subject to the provisions of the KWG in full, while DEG is subject to it with certain restrictions only. The group company KfW Capital is a medium-sized investment firm and subject in particular to the relevant regulatory requirements of the German Securities Trading Act (Wertpapierhandelsgesetz – "WpHG") and the Investment Firm Act (Wertpapierinstitutsgesetz – "WpIG").

Transparency

KfW provides all important information about the bank's annual and consolidated financial statements, the quarterly and semi-annual reports and the financial calendar on its website. Investor relations activities and corporate communications also involve regular announcements on the latest company developments. The annual corporate governance reports of KfW and the group companies KfW IPEX-Bank, KfW Capital and DEG including the declaration of compliance with the PCGK, are always available on KfW's website.

Risk management

Risk management and risk control are primary responsibilities of overall bank management at KfW. In its risk strategy, the Executive Board defines the framework for the bank's business activities regarding risk tolerance and risk-bearing capacity. This ensures that KfW fulfils its particular responsibilities with an appropriate risk profile effectively and for the long term. The bank's overall risk situation is subject to comprehensive analysis in monthly risk reports to the Executive Board. The Board of Supervisory Directors regularly receives detailed information on the bank's risk situation, at least once a quarter.

Compliance

Compliance at KfW includes, in particular, measures for data protection, securities compliance, financial sanctions, for the prevention of money laundering, terrorist financing and other criminal activities and to achieve adequate information security. There are therefore binding rules and procedures that influence the day-to-day implementation of values and the corporate culture and are continually updated to reflect current law as well as market requirements. Compliance's responsibilities also include collaboration with financial regulators BaFin and Bundesbank as well as the central function for compliance in accordance with the minimum requirements for risk management (MaRisk). Regular training sessions on all compliance issues are held for KfW's employees. E-learning programmes are available in addition to classroom seminars.

KfW Financial Report 2024

Financial Report > Corporate Governance Report

Accounting and auditing

As the supervisory authority, the Federal Ministry of Finance in consultation with the Federal Audit Office appointed Deloitte GmbH Wirtschaftsprüfungsgesellschaft as auditor for financial year 2024 on 9 May 2023. The appointment was based on the proposal made by KfW's Board of Supervisory Directors on 30 March 2023. The Audit Committee prepared the recommendation. The bank and the auditor agreed that the Chair of the Audit Committee would be informed without delay of any findings and incidents discovered during the audit that are significant to the duties of the Board of Supervisory Directors. It was furthermore agreed that the auditor would inform the Audit Committee Chair and remark in the auditor's report if it noticed any facts in performing the audit that represent misstatements in the declaration of compliance with the PCGK. The audit engagement also included verification that the declaration of compliance with the PCGK was submitted and published in the Corporate Governance Report (clause 8.2.4).

Efficiency review of the Board of Supervisory Directors

Since Section 25d (11) KWG became applicable as of 1 July 2014, the Presidial and Nomination Committee has been required to evaluate the efficiency of both the Board of Supervisory Directors and the Executive Board on an annual basis. Both evaluations are performed on a yearly basis, most recently in June 2024.

Sustainability/sustainability report/fair taxation

As a digital transformation and promotional bank, KfW pursues sustainable corporate governance in line with Germany's National Sustainable Development Strategy and thereby contributes to achieving the UN Sustainable Development Goals ("SDGs") and to fulfilling the Paris Agreement on climate change and the Kunming-Montreal Global Biodiversity Framework ("GBF"). KfW's strategic efforts in sustainable financing are mainly focused in the "tranSForm" project and in a project to develop a group-wide biodiversity strategy. The main components of tranSForm are the expansion of the impact management system, ensuring the 1.5°C compatibility of KfW's financing activities, developing a greenhouse gas accounting system, even stricter inclusion of ESG risk factors in KfW's risk management and greater transparency regarding the sustainability of KfW's financing activities.

KfW Group prepared for group-wide application of Article 8 of the EU Taxonomy Regulation and the EU Corporate Sustainability Reporting Directive (CSRD), and is generating the combined non-financial report in accordance with the European Sustainability Reporting Standards (ESRS) for the first time, with the exception of ESRS 1.110, as the report was not integrated in KfW Group's combined management report. This therefore means partial application of the ESRS. The combined non-financial report is incorporated into the Financial Report of KfW Group for financial year 2024.

Non-material sustainability matters within the meaning of this combined non-financial report, which were previously included in the "Sustainability Report in accordance with GRI, HGB and TCFD" will be additionally published during 2025 as "Additional information on KfW Group's commitment to sustainability". As a state-owned promotional bank, KfW is subject to a specific fiscal regime and is exempt from income taxes. In contrast, unlike KfW itself, KfW's subsidiaries are fully or partially subject to income tax. Full compliance with all national and international tax laws is part of sustainable corporate governance at KfW and is set out in the bank's tax mission statement and code of conduct. KfW Group does not develop or support any tax models aimed exclusively at achieving tax advantages or reductions. In particular, KfW Group does not use or support any artificial tax schemes. It engages in open, transparent and cooperative interaction with domestic and foreign tax authorities.

Diversity and equal opportunities/inclusion

Diversity and equal opportunities are a matter of course for KfW. Discrimination based on nationality, ethnic origin, gender, religion, fundamental beliefs, disability, age or sexual orientation is prohibited. This is set out in KfW's Code of Conduct, as well as in the binding targets for a balanced proportion of men and women at all management levels in KfW's Equal Opportunities Plan. KfW is a signatory to the Diversity Charter, and implements it through a variety of internal and external measures.

KfW Financial Report 2024

Financial Report > Corporate Governance Report

KfW includes people with disabilities in line with the UN Convention on the Rights of Persons with Disabilities. KfW has embedded the convention's goals in its Inclusion Agreement, which it concluded with the general representative for those with severe disabilities for KfW and KfW's General Staff Council. KfW has set itself a binding target quota of 6% employees with disabilities in relation to its total workforce. This target is accompanied by comprehensive measures to recruit employees with disabilities (e.g. posting job advertisements on target group-specific job platforms, such as myAbility.jobs, cooperating with a number of associations and organisations, as well as with a working group on establishing physical and digital accessibility).

Mobile working/work-life balance

Striking a balance between work and personal life is key to staff remaining healthy and actively employed. This approach forms the basis of KfW's strategically designed, family-friendly personnel policy. KfW helps its employees to balance their work and personal lives as well as possible, each in their own unique way. To this end, it offers them a broad range of part-time working models and established mobile working options.

Remuneration/equal pay

The collective bargaining agreements for the public and private banking sector concluded by the Association of German Public Banks (Bundesverband Öffentlicher Banken Deutschlands - "VÖB") apply to KfW employees subject to collective bargaining, by classification in pay scale groups. Employment contracts of employees not covered by collective bargaining agreements contain provisions in line with the main working conditions of the VÖB master collective agreement (in particular working hours and leave entitlement), to ensure a coherent remuneration level. KfW supports the policies by means of staff agreements. Similar policies on collective and individual contractual bases are also in place for employees of the other KfW Group companies. KfW is expressly committed to fair, transparent and non-discriminatory remuneration principles and to the same standards for the evaluation process.

All KfW employees are able to assert their right to access information in accordance with Section 10 of the German Transparency of Remuneration Act (Entgelttransparenzgesetz). All KfW Group companies have implemented this legislative requirement to the extent applicable.

In awarding contracts for services, KfW also ensures that applicable collective bargaining and statutory provisions on the remuneration of service providers are observed.

Frankfurt am Main, 2 April 2025

The Executive Board

The Board of Supervisory Directors

KfW Financial Report 2024

Combined non-financial report

Financial Report > Combined non-financial report

General information

30
- Basis for preparation of the sustainability report for KfW Group 30
- Strategy, business model and value chain 32
- KfW Group's value chain 34
- Interests and views of stakeholders 36
- Integrating sustainability matters into the business strategy 38
- Business model and strategy in the context of material impacts, risks and opportunities 40
- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy 41
- Materiality assessment 50
- Processes to identify material impacts, risks and opportunities 50
- Determining information identified as material 55
- Governance 62
- Executive Board and Board of Supervisory Directors of KfW 62
- Structure and organisation of sustainability governance 64
- Statement on due diligence in sustainability matters 66
- Internal controls and risk management relating to sustainability reporting 67
- Disclosures on ESG risks 67

Environmental information

69
- Overarching environmental targets and actions 69
- SDG mapping of KfW's financing activities 69
- Expansion of group-wide impact management 72
- Environment quota 72
- Additional information on KfW Group's environmental targets 76
- Overarching policies 76
- Environmental and Social Appraisal Guidelines 76
- Exclusion lists at KfW Group 81
- Specific disclosures: Climate and energy 83
- Greenhouse gas emissions 83
- 1.5°C alignment of KfW's financing activities 87
- Paris-aligned sector guidelines 87
- Actions to achieve 1.5°C alignment for new financing 89
- DEG Impact/Climate Commitments 90
- Specific disclosures: Pollution 91
- Specific disclosures: Biodiversity 92
- Biodiversity actions 92
- Specific disclosures on biodiversity in policies 93
- Disclosures on climate and biodiversity risks 93
- Resilience of KfW Group's strategy and business model regarding biodiversity risks 93
- Disclosures in accordance with Article 8 of the EU Taxonomy 94
- Legal requirements in the context of the EU Taxonomy Regulation 94
- Application of the EU taxonomy within KfW Group 95
- Basis for taxonomy reporting within KfW Group 95
- Implementation of the taxonomy assessment process within KfW Group 97
- Disclosures by KfW Group on the EU taxonomy as of 31 December 2024 98
- Additional information on the tables in the appendix 100

KfW Financial Report 2024

Financial Report > Combined non-financial report

Social information

101
- Social matters at KfW Group 101
- Social matters in banking operations 103
- Diversity and inclusion 103
- Remuneration 110
- Working conditions 113
- Procedures for engaging with the own workforce and workers' representatives 116
- Social matters in the banking business 119
- Value chain workers and affected communities 119
- Customers – Consumers and end-users 126
- Customers – Corporates 129
- Complaints management 130
- KfW Group's grievance mechanisms 131
- Ombudsperson 131
- KfW's LkSG complaints procedure 131
- Complaints channels for employees 132
- Group-wide complaints management in the banking business 133

Governance information

136
- Compliance strategies at KfW Group 136
- Promoting and further developing the corporate culture 136
- Strategies relating to aspects of business conduct policies 137

Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

139
- Summary of KPIs to be disclosed by credit institutions under Article 8 Taxonomy Regulation 139
- Assets for the calculation of GAR 140
- GAR sector information 146
- GAR KPI stock 150
- GAR KPI flow 156
- KPI off-balance sheet exposures 162
- Templates for nuclear and fossil gas-related activities 166
- Templates based on stock figures 166
- Templates based on flows 173
- Templates based on stock figures – financial guarantees (off-balance sheet) 180

Independent auditor's assurance report

181

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

General information

For financial year 2024, KfW Group's sustainability reporting is based on a sustainability statement within the meaning of the European Sustainability Reporting Standards ("ESRS"; Commission Delegated Regulation [EU] 2023/2772 of 31 July 2023, as amended) for the first time. The report was prepared in accordance with the ESRS, with exception of ESRS 1.110, as the report was not integrated in KfW Group's combined management report, and thus apartial application of the ESRS took place. The transition to the ESRS as a reporting standard was made in light of the increasing significance of the ESRS as an EU-wide reporting standard in the form of an EU Commission Delegated Regulation, which is applicable with immediate effect. The ESRS reporting standard thus replaces KfW Group's previous comprehensive reporting in line with the international framework of the Global Reporting Initiative ("GRI") and the Task Force on Climate-related Financial Disclosures ("TCFD"). Sustainability matters that are classified as non-material within the ESRS, but were included in the previous reporting in accordance with GRI, HGB and TCFD will be published separately during 2025.

In line with the consolidated non-financial statement in the combined management report, this report also contains the combined non-financial report of KfW as the parent company and of KfW Group in accordance with Sections 315b and 289b of the German Commercial Code (Handelsgesetzbuch – "HGB") and Section 315c in conjunction with Sections 289c to 289e HGB, as the Corporate Sustainability Reporting Directive ("CSRD"; [EU] 2022/2464) has not yet been transposed into German law. The combined non-financial report of KfW as the parent company and of KfW Group will be referred to in the following as "sustainability report". Reporting pursuant to Article 8 of the EU Taxonomy Regulation for financial year 2024 is also integrated in this sustainability report.

Due to the first-time application of the ESRS, quantitative disclosures are provided without comparative information for previous periods in accordance with ESRS 1.136.

Basis for preparation of the sustainability report for KfW Group

In this consolidated sustainability report, the information on sustainability matters of KfW Group is presented in accordance with the scope of consolidation of the consolidated financial statements. Please refer to "Disclosures on shareholdings" in the consolidated financial statements for a presentation of the group of consolidated companies. The sustainability report covers all companies in the consolidated financial statements that have been consolidated pursuant to commercial and supervisory law. Where disclosures in this sustainability report refer to KfW, they relate exclusively to KfW as the parent company. This also applies to the consolidated subsidiaries (e.g. KfW IPEX-Bank, DEG and KfW Capital). Where reference is made to KfW Group, this relates to all subsidiaries included in the consolidated financial statements. The group of consolidated companies to be used is reviewed on an annual basis. Based on Section 289b (2) HGB, this report releases KfW IPEX-Bank from the obligation to include a non-financial statement in its management report in accordance with Section 340a (1a) HGB and Section 267 (3) sentence 1, (4) and (5) HGB. This means that the individual reporting obligation for KfW IPEX-Bank will no longer apply in financial year 2024.

The relevant sections of this sustainability report indicate where the reporting includes information based on other legal provisions or generally accepted standards – for example, the International Finance Corporation ("IFC") Performance Standards, the core labour standards of the International Labour Organization ("ILO"), and the guidelines of the Organisation for Economic Cooperation and Development ("OECD"). The option to omit specific information regarding intellectual property, know-how or the results of innovations was not used. Nor was use made of the option to exempt from disclosure of impending developments or matters in the course of negotiation. With regard to the value chain, this sustainability report covers the material impacts, risks and opportunities along KfW Group's entire upstream and downstream value chain. The value chain is described in the following section "KfW Group's value chain". Where discretionary decisions, estimates and assumptions are made within or outside of the value chain, this is indicated at the relevant points. Quality assurance for this report is carried out in line with the procedure set out in the "Internal controls and risk management relating to sustainability reporting" section of this chapter. No external parties performed quality assurance. Deloitte GmbH Wirtschaftsprüfungsgesellschaft performed an independent limited assurance engagement.

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

Reporting is based on the following time horizons:

Short-term: corresponds to the period of 1 January to 31 December of the financial year to which this report refers)
Medium-term (pursuant to ESRS 1 77b): from the end of the short-term time horizon, up to five years
Long-term (pursuant to ESRS 1 77c): consideration of impacts over a period of more than five years
Long-term (pursuant to ESRS 2 BP-2 9a): analysis of risks and opportunities over a period of ten or more years

Differentiation of long-term time horizons for impacts, risks and opportunities is based on existing processes (e.g. group business sector planning or risk inventory).

Some information in this sustainability report is incorporated by reference, as listed below. In accordance with ESRS 1.119 et seq., references are made exclusively to the combined management report or the consolidated financial statements. Reference is made to the relevant section of the document by means of such reference to the combined management report or the consolidated financial statements without repeat mention of the section.

Disclosure requirements incorporated in the sustainability report by reference

Disclosure requirement	Section of financial report	Chapter in financial report
ESRS 2
BP-1	Disclosures on shareholdings	Consolidated financial statements
SBM-1	KfW's business model	Basic information on KfW Group
	General economic environment	Economic report
	New business projections	Forecast and opportunity report
	Development of KfW Group	Economic report
	Strategic objectives 2029	Basic information on KfW Group
SBM-3	Internal management system	Basic information on KfW Group
	General economic environment and development trends	Forecast and opportunity report
	KfW's business model	Basic information on KfW Group
	Segment reporting by region	Consolidated financial statements
GOV-2	Organisation of risk management and monitoring	Risk report
	Internal management system	Basic information on KfW Group
GOV-5	Additional internal control procedures	Risk report
IRO-1	Internal management system	Basic information on KfW Group
	Organisation of risk management and monitoring	Risk report

Environmental information

E1 IRO-1	General economic environment and development trends	Forecast and opportunity report
	KfW's business model	Basic information on KfW Group
E1-2 in conjunction with ESRS 2 MDR-P	Current developments	Risk report
E1-3 in conjunction with ESRS 2 MDR-A	Organisation of risk management and monitoring	Risk report
E1-4, E2-3, E4-4 in conjunction with ESRS 2 MDR-T	Strategic objectives 2029	Basic information on KfW Group
E1-4	Organisation of risk management and monitoring	Risk report
E4-1	Organisation of risk management and monitoring	Risk report

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

Social information
S1-1	Strategic objectives 2029	Basic information on KfW Group
S1-6	Average number of employees during the financial year	Consolidated financial statements
Governance information
G1-1	Additional internal control procedures	Risk report

Strategy, business model and value chain

KfW as the parent company is a promotional bank of the Federal Republic of Germany. The Federal Government owns 80% of KfW's share capital and the German federal states own the remaining 20%. KfW's business model and business activities as a state-owned promotional bank are primarily governed by the KfW Law. The areas of activity comprise promotional business and the related transactions in accordance with Article 2 (1) and (3) of the KfW Law as well as the mandated transactions in accordance with Article 2 (4) of the KfW Law. Mandated transactions constitute business that the Federal Government mandates to KfW on a case-by-case basis for reasons of state interest and that is generally structured as lending and equity investment business. Mandated transactions may deviate from the requirements of KfW's exclusion list (see "Exclusion lists at KfW Group" section in the "Environmental information" chapter), the sector guidelines (see "Paris-aligned sector guidelines" section in the "Environmental information" chapter) or the sustainability guidelines (see "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter) in individual cases. This also applies to targets set in connection with sustainability matters relating to KfW Group. The promotional business, the related transactions and the significance of Federal Government mandated transactions are described in more detail in the "KfW business model" section in the "Basic information on KfW Group" chapter. For a description of the business model, please also refer to the "KfW business model" section in the "Basic information on KfW Group" chapter. Through its business sectors, KfW Group offers the following products and/or services to various groups of customers in the direct financing, on-lending and investment business (see table below). For further information on the main product/service and customer groups, please refer to the "General economic environment" section of the economic report, the "New business projections" section of the forecast and opportunity report, and the "KfW Group's value chain" section of this chapter. KfW Group generated total sales revenue of EUR 21.9 billion in financial year 2024.

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

Overview of business sectors and their products/services and customer groups deemed significant within the meaning of ESRS 2¹)

Business sector	Products/services and customer group
Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	– SME Bank: promotion²) of companies in the areas of energy efficiency, renewable energy, environment and sustainability, innovation and digitalisation, general corporate financing and entrepreneurship
– Private Clients: primarily promotion of education (e.g. student loans) and promotion²) for private clients in the area of residential properties (e.g. energy-efficient new construction/refurbishment, acquisition or construction of own homes)
Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	Financing in the Climate and environment and Digitalisation and innovation areas of the KfWplus transformation agenda:
– Basic and broad-based promotion for municipalities and municipal and social enterprises²)
– Customised debt financing solutions with risk assumption for enterprises and project companies
– Global financing for banks, leasing companies and funding for promotional institutions of the federal states
KfW Capital	– Stakes in venture capital and venture debt funds to generate innovation, value creation and employment
– Investments in the co-investment fund coparion and in the four generations of the High-Tech Gründerfonds for start-ups
– Coordination of the Future Fund (“investment fund for forward-looking technologies”)
Export and project finance	– KfW IPEX-Bank is a specialist bank for international project and export financing
– Support for sustainability and digitalisation, financing for exports, infrastructure investments, securing raw materials and climate and environmental action projects
– Financing for projects and investments in the interests of Germany and Europe
KfW Development Bank	– Financing of programmes and projects that mainly involve public-sector players in developing countries and emerging economies on behalf of the German Federal Government
– Promotional priority areas include social infrastructure, economic infrastructure, financial system development and multisectoral issues such as environmental protection and resource conservation, migration and displacement and support for reform processes.
DEG	– Promotion of sustainable development/expansion of the private sector in developing countries and emerging economies
– Structuring and financing of investments and equity investments/funds by and in private companies in developing markets as well as advising companies on their sustainable transformation
– Investments in and by companies in the agriculture, services, industry and infrastructure/green energy sectors, as well as in financial institutions and private equity funds

¹) The activities in the business sectors Financial markets and Head office are not recorded under the definition of the datapoint ESRS 2 SBM-1 40 a) (i.-ii.) in conjunction with AR 13 and therefore not included in this list.

²) The promotional programmes include standardised, on-lent financing (see explanation in the section on “KfW Group’s value chain”).

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

KfW Group's value chain

KfW Group's value chain is made up of value chain actors which are part of its own operations or the upstream and downstream value chain. The following figure illustrates this value chain.

KfW Group's value chain

KfW Group's value chain begins with upstream entities such as suppliers/service providers, investors (funding) and shareholders. Funding on the money and capital markets has a material impact on the group's business activities. KfW's creditworthiness, which is assessed by rating agencies, is key to its funding conditions. In addition to the institutional liability (Anstaltslast), it is necessary to mention the comprehensive liability of the German Federal Government under Article 1a of the KfW Law, which extends to loans taken out and bonds issued by KfW, forward transactions structured as fixed transactions, the rights conferred by options and other loans to KfW, and loans to third parties insofar as they are expressly guaranteed by KfW. As a result, KfW is ranked by rating agencies as having top-notch credit quality (triple-A rating). KfW Group receives additional funding from the German federal budget, for example to channel grants to customers as part of promotional programmes.

KfW Group's workforce in the central units and business sectors, along with the members of the Executive Board and the Board of Supervisory Directors, are among the actors in KfW Group's own operations. The central departments take on overarching tasks within KfW Group, such as Human Resources, Credit Risk Management, Risk Controlling, Compliance, Finance, and Group Development and Economics. Some of these functions are organised independently in the subsidiaries. KfW Group's value creation is realised through its own operations, which are a link between the upstream and downstream value chain. All necessary internal processes and activities to provide financing solutions and products are performed in own operations. The business sectors operationalise the business model and the business activities. For a description of the current and expected results of business activities, please refer to the "Development of KfW Group" section of the economic report and the "New business projections" section of the forecast and opportunity report.

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KfW Group's banking business (downstream value chain) comprises the products offered in the individual business sectors in the direct financing, on-lending and investment business. The direct financing business includes national and international direct financing by KfW, KfW IPEX-Bank and DEG for corporates including finance companies, public organisations (e.g. municipalities, states and ministries) and private individuals. In the on-lending business, KfW supports lending by financing partners to end customers by providing loans at favourable interest rates. The intermediary financing partners (financial institutions) enable customers (companies, private individuals and public institutions) to apply for KfW promotional loans and use the funds granted for this purpose. In this arrangement, KfW has no direct contractual or other business relationship with the end customers of the on-lending business. The on-lending principle is firmly anchored in the KfW Law and is a central component of KfW's business model. It represents an important sales channel. The on-lending principle can involve one or two financing partners, which are assigned to the first level in the downstream value chain depicted. The investment business consists of investments in venture capital and venture debt funds in the business sector KfW Capital, as well as investments in private equity, venture capital and venture debt funds or equity investments related to the business activities of DEG and KfW Development Bank. KfW manages and secures its financial liquidity by investing in debt securities in a liquidity portfolio managed by the business sector Financial markets, among other things.

The end of the downstream value chain is defined by the information, influence and control options resulting from the sustainability guidelines of KfW Group's business sectors or by the business model in accordance with the KfW Law. The sustainability guidelines dictate how the respective business sectors in the direct financing and on-lending business are to deal with environmental and social aspects and how the Environmental and Social Appraisal ("E&S Appraisal") is to be implemented in practice. The E&S Appraisal considers and assesses a project to be financed for potential risks and impacts on people and the environment. In the direct financing business, the value chain normally ends at the first level with the direct business partner.

In the on-lending business, the E&S Appraisal is normally the responsibility of the intermediary financing partners in accordance with recognised international practice (in the case of financing for projects outside the EU or OECD high income countries, KfW Group may also be responsible for the E&S Appraisal). KfW Group carries out spot checks of the procedures for implementation of E&S Appraisals used at the intermediary financing partners. Moreover, financing partners must observe the general terms and conditions of the respective promotional programme and ensure compliance with all environmental and social requirements and standards applicable in the country of investment.

Notwithstanding the foregoing, KfW Development Bank and DEG, as part of the E&S Appraisal, review the environmental and social management system of intermediary financing partners or ensure the introduction or implementation of an environmental and social management system when financing projects with intermediary financing partners or when issuing credit lines.

In the case of the on-lending business, the value chain ends at the second level with the customer of the on-lending business, despite the involvement of financing partners, thus highlighting the significant importance of the on-lending principle and the direct link to KfW's business model.

In the investment business, KfW Capital invests in venture capital and venture debt funds. As part of due diligence, KfW Capital analyses the handling of environmental, social and governance ("ESG") risks and opportunities, sustainability governance and responsibilities for sustainability matters. The KfW Capital Sustainability Policy provides for a review at the level of the respective venture capital or venture debt fund. The assessment of the impact of investments on the environment and society as part of group-wide impact management is also recorded at this stage.

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DEG's investments in banks, companies, project financing, private equity funds and venture capital funds are governed by the DEG Guideline for environmental and social sustainability. DEG ensures the introduction/implementation of an environmental and social management system as part of its E&S Appraisal and pursuant to contractual regulations and therefore implicitly ensures compliance with international standards such as the IFC Performance Standards and the ILO Core Labour Standards. DEG's E&S Appraisal provides for a risk categorisation of the customers. The same applies to KfW Development Bank's fund business, where the corresponding Sustainability Guideline of KfW Development Bank applies. For further information on the sustainability guidelines and E&S Appraisal of the business sectors, refer to the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter.

Interests and views of stakeholders

As explained in the table below, KfW Group is in continuous dialogue with key stakeholders across its entire value chain. The term stakeholder in this regard refers to various groups that are either affected by or can affect KfW Group's activities. KfW Group's most important stakeholders along the value chain are:

Analysts, representatives of rating agencies and initiatives
Business contacts from the investment business
Competitors
(Potential) employees
End customers (or their representatives, e.g. associations) from the direct financing business and borrowers (or their representatives, e.g. associations) from the promotional programmes of the on-lending business
Executive Board and Board of Supervisory Directors of KfW
Financing contacts (or their representatives, e.g. associations) from the direct financing business
The general public
Intermediary financing partners as business contacts in the on-lending business
Investors (funding)
Parties directly affected by KfW Group investments and financing
Population groups whose living conditions are to be improved
Public sector clients and strategic cooperation partners in politics and business
Regulators
Representatives from the media, the research community, supra-national interest groups and non-governmental organisations
Shareholders
Suppliers
Workers in the downstream value chain

KfW Group involves external stakeholders via various dialogue formats. The following table shows some of the key dialogue formats:

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Selected dialogue formats with external stakeholders 2024

Format	Participants	Implementation	Frequency	Purpose and consideration of results
Advisory Board of KfW Capital	Experts from the venture capital ecosystem (fund managers, investors, representatives of associations, professors, ministries, Deutsche Börse and KfW)	KfW Capital	Once a year	Dialogue on certain priority topics and current developments
Bilateral talks	National/international promotional or commercial banks (peer group)	KfW/KfW Development Bank/DEG	As necessary	Important innovations and milestones in the sustainability strategy and dialogue on sustainability matters
	Investors, national/international commercial banks	KfW/financial markets	As necessary	Dialogue on sustainability-related topics
Bonn breakfast (Bonner Frühstücksrunde)	Leaders from development cooperation	DEG in cooperation with Engagement Global	Four times a year	Networking event and sharing of substantive impetus for guests; reputation management for DEG
Development forum (Entwicklungsforum)	External speakers (e.g. experts from scientific community or peer group banks) and KfW Development Bank employees	KfW Development Bank	Once a month	Dialogue on sustainability-related topics, their development and implications for KfW Development Bank
Promotional dialogue (Förderdialog)	Selected financing partners/ bank associations, the German Federal Ministry for Economic Affairs and Climate Action and KfW	KfW	Once a year	Strategic dialogue format on overarching topics
Meetings at DEG head office	Representatives from the Bundestag, ministries, and the science, business and finance communities	DEG	Several times a year (as needed)	Dialogue with managers and other employees on development policy matters
Information and participatory event	Project stakeholders; interested members of the public	Executing agency	Dependent on actions; normally always part of the E&S Appraisal	Providing information about KfW Development Bank's actions in a culturally appropriate context, obtaining feedback for use in decision-making processes
Information and feedback session with financing partners and bank associations	Selected domestic financing partners and bank associations	KfW	As necessary	Sounding out new promotional approaches; discussion and feedback on promotional products
KfW new customer monitoring	Borrowers from the promotional programmes of the domestic business	KfW	Once a month	Feedback on satisfaction of individuals and companies with the products, processes and services
NGO dialogue	NGOs as representatives of various stakeholder groups	DEG	Once a year	Dialogue format to bring a wide range of interests to DEG's attention
NGO dialogue at the UN Climate Change Conference	Climate, environment and human rights NGOs and representatives from various stakeholder groups	KfW	Once a year	Dialogue format on sustainability-related topics
Political breakfast in Berlin	Representatives from the Bundestag, ministries and the formal economy in the fields of development policy and foreign trade	DEG in cooperation with the German Chamber of Industry and Commerce	Once a year	Networking event and sharing of substantive impetus for guests; reputation management for DEG
Project visits as part of project audits and progress checks	Workers in the downstream value chain and affected communities (e.g. the general public)	KfW Group	As necessary	As part of project monitoring, to gain direct impressions of project implementation
Corporate Advisory Board	Sector representatives and experts from scientific community and ministries	KfW IPEX-Bank	Twice a year	Dialogue on certain priority topics and current developments
Company visits	Representatives from parliament, ministries and the general public	KfW Development Bank and DEG	Several times a year (depending on delegation trips made by representatives)	Presentation of the developmental impact of DEG investments based on specific companies

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

Dialogue with stakeholders is of particular importance to KfW Group. The dialogue formats may be enhanced if necessary, depending on the results of the engagement, and may be involved in strategic planning or operating processes.

KfW Group also has various overarching and business sector-specific grievance mechanisms by means of which stakeholders affected by the banking business can voice their complaints about potential risks to human rights and the environment. Moreover, KfW Group's workforce has various options for responding to fields of action, disadvantages and complaints. KfW Group also has an established German Supply Chain Act (Lieferkettensorgfaltspflichtengesetz – “LkSG”) complaints procedure for banking operations. For a detailed description of the respective grievance mechanisms, please refer to the “Complaints management” section in the “Social information” chapter and the “Strategies relating to aspects of business conduct policies” section in the “Governance information” chapter. Representation and inclusion of the interests of employees working in Germany takes place in various forms: through engagement with workers' representatives, surveys of employees in Germany or intranet postings. For more detailed information on the engagement of KfW's own workforce, please refer to the “Procedures for engaging with the own workforce and workers' representatives” section, which can be found in the “Social information” chapter. The Executive Board and Board of Supervisory Directors are informed via various channels about stakeholder viewpoints and interests with respect to KfW Group's sustainability-related impacts. For example, the Group Development department assesses negative/critical media reports and NGO reports on KfW Group on an ad hoc basis. Risk Controlling has the option of submitting the assessment to the Executive Board as part of quarterly reputational risk monitoring.

Engagement with KfW Group stakeholders also includes participation and involvement of the Board of Supervisory Directors. KfW Group's shareholders are represented on the Board of Supervisory Directors and exercise both a control and a shareholder function. The Executive Board regularly discusses important issues relating to corporate management and strategy with the Chair and Deputy Chair of the Board of Supervisory Directors. If necessary, the Chair of the Board of Supervisory Directors convenes an extraordinary meeting and informs the Board of Directors about important matters. In the reporting year, the Executive Board informed the Board of Directors about strategies, planning, business development, profitability, the risk situation, risk management, compliance, remuneration strategy, IT strategy, the financial position, sustainable corporate governance and its implementation, and results. Information was also provided on the group companies, transactions of particular importance to the profitability or liquidity of the company and changes in the economic environment significant to the company.

In accordance with Article 7a (1) sentence 1 of the KfW Law, there is also an SME Advisory Council. In accordance with Article 7a (2) of the KfW Law, it specifies the state mandate of the Mittelstandsbank (SME Bank), deliberates and takes decisions on proposals for the promotion of small and medium-sized enterprises, taking into consideration the overall business planning of KfW. The Executive Board informs the Council at least once a year about programmes that are underway or planned for the medium term, and submits alternative proposals on request. In accordance with Article 7a (1) sentence 2 of the KfW Law, the SME Advisory Council consists of nine representatives or appointed members from the German Federal Government and two representatives appointed by the Bundesrat. It is chaired by the Federal Minister for Economic Affairs and Climate Action; the Federal Minister of Finance serves as deputy chair.

Integrating sustainability matters into the business strategy

KfW Group believes it has a responsibility to accelerate the sustainable transformation of society and the economy and to boost Germany as an industrial and technological hub. To achieve this goal, KfW Group is striving to become the leading digital transformation and promotional bank. In this context, the strategic KfWplus transformation agenda is designed to pave the way towards meeting the challenges of this decade. In addition to digitalisation, innovation and climate change mitigation, the agenda also includes actions to combat biodiversity loss. KfWplus constitutes the strategic framework for KfW Group and is operationalised in the strategic objectives 2029. The strategic objectives 2029 reflect how KfW Group wants to position itself over a five-year horizon. For further information on the KfW Group business strategy, KfWplus and the strategic objectives 2029, refer to the "Strategic objectives 2029" section in the "Basic information on KfW Group" chapter.

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Financial Report > Combined non-financial report > General information

KfW Group's strategic ambitions are aligned with the German Federal Government's mandate and its Climate Action Programme 2030, and the German Sustainable Finance Strategy. The Federal Government's Climate Action Programme 2030, aimed at implementing the Climate Action Plan 2050 (Federal Government climate action programme), provides for KfW Group's development into a transformative promotional bank that will support the transformation of the country's economic sectors and financial market. The promotional mandate issued to it by the Federal Government is implemented by KfW in the business sectors and via special tasks commissioned by the Federal Government.

The group-wide sustainability mission statement is closely linked to the business strategy as an overarching frame of reference for KfW Group's actions. The mission statement is directly based on the UN's Sustainable Development Goals ("SDGs"), the Paris Agreement of 2015 and the German Sustainability Development Strategy. The sustainability guidelines of the business sectors, subsidiaries and central units set out the requirements of the sustainability mission statement in greater detail with regard to environmental and social issues. KfW Group pursues a sustainable finance concept that aims to anchor sustainability rigorously, multidimensionally and measurably in all promotional and financing activities. With its group-wide "tranSForm" sustainability project, KfW Group has further developed and refined its sustainable finance policy (see the "Expansion of group-wide impact management" section in the "Environmental information" chapter). The primary objective, "sustainable promotion", is firmly established in the group-wide strategic objectives 2029 and includes key management approaches from "tranSForm". Other important strategic moves are being gradually integrated into the sustainable finance policy. For instance, it has included KfW Group's commitment to biodiversity since mid-2023. A "BioDiv Roadmap" is being prepared to ensure that the group addresses biodiversity in a holistic and targeted manner, with the necessary groundwork already completed in 2024. Building on this, KfW Group plans, among other measures, to have developed a qualitative biodiversity strategy by 2026 in order to reinforce positive impacts on biodiversity, reduce adverse impacts and minimise the associated business risks.

The KfWplus transformation agenda provides a framework for the banking business through its core elements "Climate & environment", "Digitalisation & innovation" and "Managing impact & mobilising private capital". In line with the agenda, KfW Group is careful to avoid potential adverse impacts and risks to society and the environment (including the climate) in its promotional and financing activities, and where possible attempts to reduce or offset such impacts through suitable actions. Based on the strategic objectives 2029 and its sustainability mission statement, KfW Group primarily uses its exclusion list (see the "Exclusion lists at KfW Group" section in the "Environmental information" chapter), its E&S Appraisals in accordance with international standards (see the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter) and its Paris-aligned sector guidelines to bring its promotional and financing activities closely in line with the 1.5°C target (see the "1.5°C alignment of KfW's financing activities" section in the "Environmental information" chapter). SDG mapping is used to ensure the operationalisation of the "SDG mapping" target defined in the strategic objectives 2029. Additionally, an impact management system has been developed based on the SDGs as part of "tranSForm" (see the "Environmental information" chapter). Impact management is also to be used in future to help operationalise this target. Furthermore, there is a definition of environmentally sustainable lending at KfW Group level which addresses the regulatory requirements set out in the 7th amendment to the German Minimum Requirements for Risk Management ("MaRisk") in conjunction with the European Banking Authority's Guidelines on Loan Origination and Monitoring. The definition includes promotional and financing activities of which the new commitment volume counts towards the environment quota set out in the strategic objectives 2029, meaning that they contribute to the "Climate and environment" promotional area in line with KfWplus. Furthermore, the strategic objectives 2029 define an SME share of financing that exceeds 40% of new commitments as a target to bolster the German SME segment. An overview of the contributions made by KfW Group's business sectors to the environment quota and SME share of financing can be found in the "Environment quota" section in the "Environmental information" chapter and the "Customers - Corporates" section in the "Social information chapter". Please refer to the "New business projections" section in the "Forecast and opportunity report" chapter for further information on the assessment of relevant products and/or services, customer groups and markets.

KfW Financial Report 2024

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The impact of ESG risks on risks relevant to KfW Group are assessed as part of ESG risk management. ESG risks as a risk driver, not risk type, do not present new risks for the group to take into account in risk management. In assessing ESG as part of risk management, the focus is on the financial effects ESG risks may have. Changes in the environment ("E") such as climate change, social transformation ("S") and governance standards ("G") and their impact on the assessment of creditworthiness of KfW Group's business partners are therefore taken into account. The main focus is on the business strategy and the impacts of a range of climate scenarios on KfW Group's business activities and risk-bearing capacity.

The importance of sustainability at KfW Group is also reflected in the structure of its sustainability governance. KfW Group established the new Sustainability Strategy division and the corresponding new management role of Chief Sustainability Officer ("CSO") in 2024. The new division comprises two teams: Sustainability Policy and Sustainable Finance Management. Along with the Corporate Strategy division, the new Sustainability Strategy division is incorporated in the Group Development and Economics department to ensure ongoing close integration with the individual strategy areas. The group-wide work and dialogue on sustainability matters is also based on a broad network of decentralised sustainability officers from the individual KfW Group organisational entities (see "Corporate governance" chapter). To strategically ensure continuous development of the group-wide commitment to sustainability, the strategic objectives 2029 also aim for an average ranking among the three best development and promotional banks within a "Best of the Best" peer group. This comprises the ten best-rated development and promotional banks in the respective peer groups of three major ESG rating agencies (ISS, MSCI and Sustainalytics).

All Human Resources issues are derived from KfW Group's mandate and business strategy, including the KfWplus agenda. Specifically, with the help of the core element "top-performing KfW", the aim of KfWplus is to enable employee potential to be fostered via talent pools and further development via skills training, promotion and monitoring, in order to enhance employer attractiveness. Employer attractiveness and, above all, diversity are also firmly anchored in KfW Group's sustainability mission statement and strategic objectives 2029. The objective of the "Employer positioning" project includes improving work-life balance and improving equal opportunities for KfW Group employees. What is more, employees are to be equipped to face the challenges of the digital transformation. Please refer to the "Working conditions" section in the "Social information" chapter.

Business model and strategy in the context of material impacts, risks and opportunities

In its double materiality assessment, KfW Group has identified various potential and actual impacts, both positive and negative, as well as risks and opportunities. In each case, an analysis was performed to determine whether the impacts, risks and opportunities were material for the banking business and/or banking operations.

The term "banking business" refers to all services provided by KfW Group to its customers as part of its business activities.

Banking operations, by contrast, encompass all of KfW Group's activities, structures and processes aimed at facilitating the banking business at its sites.

The material impacts, risks and opportunities identified are mainly concentrated in the downstream value chain in the banking business. KfW Group is managed from Germany. Allocation of net interest and commission income by region can be viewed in "Segment reporting by region" in the consolidated financial statements. In the banking business, the topics of climate change, energy, pollution and biodiversity as well as value chain workers, affected communities, and consumers and end-users were identified as material. In addition, material ESG risks specific to KfW Group were determined for the banking business. The time horizons set for the report were taken into account in performing the materiality assessment. A deviating assessment within the different time horizons arose for only one material negative impact in sub-topic E1 Energy. The result for the other material impacts was identical across all time horizons. The materiality assessment process is explained in the "Processes to identify material impacts, risks and opportunities" section of this chapter.

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Material impacts, risks and opportunities can influence KfW Group's strategy, decision-making and value chain but have only a limited impact on its business model. The KfW Law defines the function, structure and organisation of KfW, as described in the "Strategy, business model and value chain" section of this chapter. The strict requirements of the KfW Law set the framework for the entire business model, including its risk-bearing capacity. As a result, the material impacts, risks and opportunities identified do not have a significant impact on the business model from KfW Group's point of view. Regardless of this, the impacts, risks and opportunities are taken into account in the Internal Management System.

The strategy and the influence of material impacts, risks and opportunities on it are addressed by a number of overarching aspects within KfW Group, which are presented below:

The Internal Management System ensures that KfW Group's risks and opportunities are sufficiently addressed in group business sector planning as the central strategy and planning process on an annual basis. The basis for the strategy process is the KfWplus transformation agenda and the strategic objectives 2029. As part of this process, the strategic objectives 2029 will be reviewed annually for relevance, completeness and level of aspiration and adjusted where necessary depending on changed parameters or newly determined promotional priority areas. Material risks and opportunities may result in changes in parameters or newly determined promotional priority areas. For further information on the Internal Management System, refer to the "Internal Management System" section in the "Basic information on KfW Group" chapter.

The sustainability guidelines of the business sectors, subsidiaries and central units are intended to boost the strategy's resilience to adverse impacts caused by the banking business. They are derived from the sustainability mission statement. The sustainability guidelines govern the treatment of environmental and social matters in (co-)financed projects of KfW Group and operationalise them via an E&S Appraisal. The aim of the E&S Appraisal is to identify, avoid, mitigate or, if unavoidable, offset possible adverse impacts and risks of a project for people and the environment. Please refer to the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter for an in-depth description of the sustainability guidelines including the E&S Appraisal.

The resilience of the strategy and the business model is also analysed and measured annually based on scenario calculations or stress tests. ESG risks are included in the scenario configuration and various time horizons are considered. Operational resilience is ensured via ESG risk management tools. For further information in this context, refer to the "Disclosures on ESG risks" section of this chapter.

Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy

The main impacts, risks and opportunities for KfW Group are presented below. For simplification reasons, the material impacts, risks and opportunities were aggregated in the categories "Climate and environmental issues in the banking business", "Working conditions in banking operations", "Persons or groups affected by the banking business" and "KfW Group-specific issues". The aggregation shows the interaction between the material impacts, risks and opportunities and KfW Group's business strategy and possible specifics of the topic clusters.

Climate and environmental issues in the banking business

KfW Group's banking business is associated with various material impacts, risks and opportunities in the 'climate and environment' area. The overarching term encapsulates the ESRS sub-topics of adaptation to and mitigation of climate change, energy, pollution and biodiversity. The following tables indicate the material impacts, risks and opportunities in this area:

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E1: Climate change

Climate change adaptation

Dimension: banking business

Type: positive impact, risk and opportunity

Climate impacts and physical climate risks may result in a liquidity/payment default risk for borrowers. Financing that boosts borrower resilience can counteract this. The increasing impact of climate change may lead to a greater need for financing for adaptation actions. At the same time, the German Federal Government's political prioritisation of health, quality employment and climate/environmental issues opens up new opportunities to launch programmes that can meet these needs.

Climate change mitigation (emissions)

Dimension: banking business

Type: positive and negative impact, risk and opportunity

Transition climate risks, such as the inability of borrowers to adapt their business model to the transition to a climate-neutral economy, can increase the liquidity and payment default risk for borrowers. Directing capital flows to and financing of sustainable investments towards 1.5°C alignment by excluding or reducing investments in climate-damaging industries and CO₂-intensive sectors, and financing climate action and other projects that reduce greenhouse gas emissions help to reduce the emissions financed – this can minimise transition risks for borrowers. Moreover, 1.5°C alignment may also be interrupted if, for example, supply security has to be guaranteed in the case of mandated transactions. The increasing impact of climate change may lead to a greater need for financing mitigation actions in order to manage the impacts of climate change. At the same time, political prioritisation of health, quality employment and climate/environmental issues opens up new opportunities to launch programmes that can meet these needs. KfW Group can establish itself as an effective trailblazer by providing financing for sustainable projects and businesses, thereby contributing to the transformation towards climate neutrality.

Energy

Dimension: banking business

Type: positive and negative impact, and opportunity

Promotion of renewable energy and energy efficiency, and financing energy-saving measures are important steps towards sustainable transformation of the energy sector. This may result in a growing need for financing for renewable energy, energy efficiency and also the infrastructure to operationalise the energy system. At the same time, political prioritisation of health, quality employment and climate/environmental issues opens up new opportunities to launch programmes that can meet these needs. In individual cases, KfW Group finances projects, on behalf of the Federal Government (e.g. mandated transactions), with a connection to fossil fuels if there is a public interest.

E2: Pollution

Pollution

Dimension: banking business

Type: positive and negative impact

Reducing pollution helps to protect and conserve the environment in the long term. Financing environmental protection projects contributes to protecting the environment. However, financing environmentally harmful or emission-intensive industries, even if they are regulated by strict environmental laws and standards, may imply an unavoidable environmental impact.

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E4: Biodiversity and ecosystems

Dimension: banking business

Type: negative impact, and opportunity

Financing can help to protect biodiversity and reduce potential credit default risks resulting from physical and transition risks for borrowers. But financing can also have a negative impact on biodiversity.

The KfWplus transformation agenda, the strategic objectives 2029 and the sustainability mission statement address the material impacts, risks and opportunities associated with financing in the areas of climate and environment. General risk management also considers associated risk drivers that influence risk types such as credit risk or market price risks. This means that these drivers are included in the management and organisation of risks and in risk processes. In the context of material impacts, risks and opportunities associated with climate and the environment, KfW Group's business strategy takes into account three sustainability goals: the SDG contribution of KfW financing activities (SDG mapping), the 1.5°C alignment of KfW's financing activities and the environment quota of financing (see the "Overarching environmental targets and actions" section in the "Environmental information" chapter). The sustainability guidelines of the business sectors that determine the respective E&S Appraisal, along with KfW Group's exclusion lists and the group-wide Paris-aligned sector guidelines, represent the central frameworks for managing negative impacts and risks in the area of climate and environment.

Material impacts, risks and opportunities in the context of climate and environment are continuously monitored, included in group business sector planning as necessary and addressed in the business strategy. They are closely linked to the business strategy and influence the decision-making process arising from the business strategy, even if only indirectly in some cases. Examples include setting up internal projects such as the "BioDiv Roadmap" project, revising and expanding the Paris-aligned sector guidelines (e.g. to include the new sector guideline for oil and gas published in December 2023) and adapting or relaunching promotional programmes (e.g. expanding the KfW Environmental Protection Programme).

Risk Controlling regularly reviews KfW Group's business strategy in terms of its resilience to climate and environmental risks so that it can determine actions at an early stage if necessary. Climate scenario analyses and stress tests are performed for this purpose. These are simulations and stress test calculations that assess the impact on KfW Group's risk and earnings position, relying on various scientific assumptions regarding global climate development and global climate policy. They are based on the climate scenarios of the International Energy Agency ("IEA") and of the Network of Central Banks and Supervisors for Greening the Financial System ("NGFS"). They also analyse whether the loan and equity investment portfolio is exposed to increased climate risks in the medium to long term. KfW Group's risk strategy stipulates performance of scenario analyses to assess the resilience of the business strategy, particularly with regard to climate risks. The results of the scenario analyses are also included in the assessment of risk-bearing capacity with regard to the risk appetite defined in the risk strategy. The risk appetite is reviewed and reassessed annually in group business sector planning. The main risk management approaches are included in the risk strategy and serve as the basis for operational risk management. Please refer to the "Processes to identify material impacts, risks and opportunities" section of this chapter for an overview of the scenario analyses performed.

The promotional priority areas including climate and environment are based on the political framework and are derived, for example, from the current version of the coalition agreement or other Federal Government programmes (such as the Climate Action Plan or the Action Plan on Nature-based Solutions for Climate and Biodiversity). These requirements strongly affect the strategy in the context of climate and environment by supporting the promotional priority areas with financing and promotional products or, as necessary, adjusting them. For further information on this, refer to the "Integrating sustainability matters into the business strategy" section of this chapter, and the overview of actions in the context of climate and environment in the "Overarching environmental targets and actions" section in the "Environmental information" chapter.

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A group-wide biodiversity strategy is to be developed in order to address the growing importance of biodiversity as an action area in KfW Group's banking business. The "BioDiv Roadmap" project was launched in 2023 to serve this purpose. The second phase of the roadmap involved developing the basics for a group-wide biodiversity strategy by December 2024. The next phase comprises developing the specific strategy and creating the structures for its implementation. The aim of the banking business biodiversity strategy is to boost positive impacts on biodiversity in all relevant business sectors, reduce adverse impacts and dependencies and minimise the associated risks in the banking business. Financing has the potential to adversely impact biodiversity, for instance, if the projects financed contribute to land degradation, desertification and soil sealing or affect threatened species. The sustainability guidelines of the business sectors address how to deal with adverse impacts in this context. For further information, please refer to the "Specific disclosures on biodiversity in policies" section in the "Environmental information" chapter.

Working conditions in banking operations

Working conditions in banking operations affect KfW Group's workforce, which includes KfW Group employees and non-employees. In addition to general working conditions, this section addresses equal treatment/non-discrimination and corporate culture. A list of the material positive impacts can be found in the tables below. No material opportunities, negative impacts or risks for KfW Group were identified in the materiality assessment.

S1: Own workforce

Working conditions

Dimension: banking operations Type: positive impact

Appropriate working conditions have a positive impact on loyalty and motivation/performance of KfW Group employees and recruitment of potential employees (e.g. less staff turnover, fewer days of absence, more new hires); non-discriminatory and transparent remuneration and flexibility in working hours and location are particularly important to KfW Group employees, and attention to mental health as well as a healthy and ergonomic working environment has a beneficial effect on general health.

Equal treatment/non-discrimination

Dimension: banking operations Type: positive impact

Creating an inclusive working environment through equality and non-discrimination and promoting structurally disadvantaged groups in management positions has a positive impact on their career development and satisfaction.

G1: Business conduct policies

Business conduct and corporate culture

Dimension: banking operations Type: positive impact

A favourable corporate culture can offer employees a working environment in which they feel comfortable and motivated, which can contribute to employee satisfaction.

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KfW Group employees include all individuals who have an employment relationship with a group company in accordance with national law or practice. Employees are all persons with an active employment contract with a group company who participate in the group's value creation. This includes individuals in partial retirement (both working and non-working periods), those in training (vocational and graduate trainees, interns, temporary student employees and sandwich-degree students), seconded and posted employees, non-active employees (e.g. due to parental leave) and local specialists as well as national staff at the foreign locations. Not included are those in German tax-advantaged "mini-jobs", early retirees, and members of the Executive Board and senior management if their position is their main activity. Reporting on employees covers all KfW Group employees in Germany and abroad. If only a certain sub-group of employees is meant, this is indicated accordingly. Employees can be divided into three types:

Employees with permanent employment contracts (all KfW Group employees with an open-ended employment contract)
Employees with fixed-term employment contracts (all KfW Group employees whose contracts expire on a certain date)
Non-guaranteed hours employees (workers without a guaranteed minimum or fixed number of working hours; such employee must be available to work as required, the employer is under no contractual obligation to guarantee the employee a minimum or fixed number of working hours per day, week or month)

In accordance with the ESRS, non-employees for KfW Group means all contractors in and outside Germany who have concluded a contract to provide labour to a company belonging to the group (self-employed), and workers providing labour supplied by undertakings primarily engaged in the placement and supply of labour (temporary employees). If only a certain sub-group of non-employees is meant, this is indicated accordingly.

KfW Group's workforce does not engage in any activities where there is a significant risk of incidents in the context of forced labour or child labour. The KfW Group human rights policy ("Declaration on respect for human rights and the human rights strategy of KfW and its subsidiaries") prohibits child and forced labour. As KfW Group is not currently pursuing any climate-related transition plans, the workforce remains unaffected by any positive or negative impact resulting from transition plans.

As the materiality assessment found no material opportunities, risks or negative impacts for KfW Group's workforce, the focus of reporting is on positive impacts. The KfWplus transformation agenda, the strategic objectives 2029 and the sustainability mission statement address the positive impacts and actively drive them forward. The business strategy takes into account important internal impact drivers relating to KfW Group's own workforce, such as available internal resources, HR marketing activities and the promotion of inclusion, equality and diversity. The strategic objectives 2029 also place a special focus on KfW Group's own workforce. They anchor the secondary objective "employee potential/customer centricity" in the business strategy in order to leverage positive impact resulting from the working conditions in banking operations. An important part of this is the "Employer positioning" project to enhance employer attractiveness, raise brand awareness and strengthen profiling and diversity, thereby putting the main positive effects into practice. The project is primarily aimed at employees in Germany. Further information on the project is provided in the "Social matters in banking operations" and "Diversity and inclusion" sections in the "Social information" chapter.

The majority of KfW Group's workforce is employed in Germany, meaning that they in particular benefit from the significant positive impacts. The creation of an inclusive working environment and the promotion of structurally disadvantaged groups have a particular impact on these groups of employees. KfW Group's workforce benefits from the positive impact of a non-discriminatory, inclusive working environment and a favourable corporate culture. The benefits of further improved working conditions for non-employees are limited compared to those for employees. For example, non-employees do not benefit from healthcare programmes, nor do they have any co-determination rights at KfW Group.

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(Groups of) persons affected by the banking business

KfW Group's banking business has different material impacts, opportunities and risks on and for different persons or groups. "Persons or groups" refers here to value chain workers, affected communities, consumers and end-users.

KfW Group finances a large number of different schemes and projects in various regions around the world. This results in different types of value chain workers. The main types are:

employees in undertakings (including financial undertakings) and public institutions that are direct financing customers
workers employed by financial undertakings as part of the on-lending business
employees in undertakings that are customers in the on-lending business
employees at private equity, venture capital and venture debt funds
employees at business partners on the money and capital markets (e.g. issuers of debt securities and trading partners)

The above list includes workers in the downstream value chain only, i.e. in connection to the banking business, as workers in the upstream value chain were not determined to be material in the materiality assessment. To improve readability, the term "value chain workers" is used below exclusively to describe the workforce within the banking business.

The value chain workers are affected by various positive and negative impacts, as shown in the following table:

S2: Workers in the value chain

Workers in the value chain

Dimension: banking business
Type: positive and negative impact

Financing can have different impacts on value chain workers. One the one hand, jobs can be created or secured through financing. On the other hand, challenges may arise that infringe on human rights and compromise the physical integrity of workers despite the exercise of strict due diligence in the value chain.

KfW Group's financing can create or secure jobs in the value chain, thereby operationalising KfW Group's primary objective or purpose "Transformation of the economy and society with the aim of improving economic, environmental and social living conditions around the world", which is enshrined in the strategic objectives 2029. For KfW Group, this means promoting sustainable development and thus providing transformational impetus to improve living conditions worldwide. The creation of new jobs also contributes to the primary objective in different ways. Firstly, it boosts the economy through higher incomes and greater purchasing power, increasing prosperity and quality of life. Secondly, new jobs can help to facilitate access to education, healthcare and other important services, and promote social integration.

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Sustainability guidelines that govern the treatment of environmental and social risks of financed projects apply to the respective business sectors' financing. Financing projects are also analysed for potential negative impacts or risks for employees, among other things. If the internal risk classification shows that an E&S Appraisal is required, international standards are applied during the assessment (see the description of the E&S Appraisal in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter). Depending on the result of the assessment, conditions may be imposed on the project to be financed. Violations of human rights and/or the physical integrity of value chain workers cannot be completely ruled out, despite compliance with strict due diligence obligations. According to KfW Group's current risk assessment, there is an increased risk of human rights violations, for example through incidents of child labour and forced labour in KfW Group's financing activities, particularly in emerging economies and developing countries. KfW's financing does not give rise to a widespread, systemic risk of human rights violations, due to the comprehensive regulations on E&S Appraisal (see the description of the E&S Appraisal in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter). However, if human rights are breached after a supported project has commenced, KfW initiates countermeasures without delay. These countermeasures must be determined, implemented and monitored on a case-by-case basis in accordance with the sustainability guidelines.

Material impacts on affected communities arise from KfW Group's banking business and therefore occur in connection with its financing activities. The materiality assessment did not reveal any material impact, risks or opportunities resulting from banking operations. Accordingly, KfW Group defines affected communities as all communities that are or could be positively or negatively impacted by accessing funding. This definition also takes into account indigenous peoples as a specific affected community. In summary, communities may be affected by the following impacts of KfW Group (see the following table:

S3: Affected communities

Affected communities

Dimension: banking business
Type: positive and negative impact

Financing can have different impacts on affected communities. Financing can affect the living conditions and circumstances as well as local rights of communities both positively and negatively.

KfW Group's financing may have a positive impact on the living conditions and circumstances of the affected communities. The primary objective firmly anchored in the strategic objectives 2029 is also addressed here. A positive impact on living conditions and circumstances can be achieved, for example, by funding education and healthcare projects, which can improve the quality of life of communities, promote economic development and create new jobs. It is also possible that financing in the area of renewable energy can help to protect the climate and the environment and reduce or completely avoid dependency on fossil fuels. In this case, affected communities can benefit from positive climate and environmental impacts, such as improved air quality or avoiding resettlement in order for fossil fuel resources to be extracted. These positive impacts benefit all groups of communities affected by KfW Group.

Financing can have a variety of adverse impacts on the affected communities and their living conditions and circumstances. Living conditions and circumstances can be influenced by aspects including traffic risks for local residents, environmental impacts (air, water, noise, waste), resettlement due to land use by the financing customers and harm to natural resources that are relevant to the livelihood of communities. Material negative impacts of financing are not systemic, as potential impacts on affected communities are assessed in accordance with the E&S Appraisal of the business sectors in advance of corresponding (project) financing (see the description of the E&S Appraisal in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter). The aim of the guidelines is to avoid negative impacts to the extent possible or, if complete avoidance is not possible, to minimise them or offset them. If the assessment shows that a financing project does not meet environmental and social

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requirements and standards, or that unacceptable environmental and social impacts or risks are to be expected that cannot be adequately reduced through suitable mitigation actions, KfW Group will not participate in the financing. Please refer to the "Value chain workers and affected communities" section in the "Social information" chapter for more information.

Material risks and opportunities relating to affected communities in the value chain were not identified in the materiality assessment.

In the sustainability report, KfW Group defines consumers as individuals who purchase, consume or use goods and services for personal use either for themselves or for third parties. End-users are persons who ultimately use a particular product or service or who are intended to use it. KfW serves consumers and end-users in two ways: directly (e.g. via student loans) and indirectly via the on-lending business (e.g. via promotional programmes such as the Home Ownership programme). Information on consumers and end-users relates to KfW, as only KfW, but not the subsidiaries, finances private clients. It must be borne in mind regarding the definition of consumers and end-users for KfW that due to the bank's role as a promotional bank, the generally applicable definition of "consumer" in the context of consumer loans (Section 491 of the German Civil Code [Bürgerliches Gesetzbuch]) does not apply. In the context of the sustainability report, however, the term "consumers and end-users" is still used for the purpose of standardisation. The following table shows the positive impacts and opportunities in relation to consumers and end-users:

S4: Consumers and end-users

Consumers and end-users

Dimension: banking business
Type: positive impact

Consumers and end-users benefit from the fact that KfW Group facilitates access to financing and promotional products for the general public and promotes housing security by financing owner-occupied housing, and improves access to education through education financing. Non-discriminatory access to promotional products enables everyone to benefit equally from the advantages.

KfW's business activities have a particularly positive impact on consumers and end-users by guaranteeing them non-discriminatory access to financing and promotional products. Cooperation with financing and sales partners in the on-lending business is a key factor. KfW also believes that individual promotional products have a favourable effect. For example, the promotion of owner-occupied housing is intended to underpin housing security. KfW also offers various types of financing in the context of school, academic and vocational training, which improves access to education primarily for financially weaker consumers and end-users. All manners of consumers and end-users benefit from improved access to KfW's financing and promotional products. However, only the relevant target group(s) can benefit from the specific financing and promotional products.

The positive impact is directly linked to the principle of subsidiarity enshrined in the strategic objectives 2029. Subsidiarity means that KfW Group focuses on eliminating market weaknesses without obstructing or driving out private-sector enterprises. One such market weakness is the tight housing and real estate market. KfW Group addresses this by improving access to financing and promotional products, such as in its operationalisation of the promotional principle.

Material impacts and opportunities concerning value chain workers, affected communities, consumers and end-users have an effect on KfW Group's strategy and the primary objective firmly anchored in the strategic objectives 2029. They may arise from the strategy or influence it:

On the one hand, KfW Group's strategy generates positive impacts, which can be seen, for instance, in the promotional priority area climate change and the environment, and in impact management and customer centricity. All three groups of people mentioned above stand to benefit from these effects. In

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the "Sustainability strategy" section, the business strategy refers to the interests of value chain workers and those of affected communities, and refers to the group-wide exclusion list, the E&S Appraisal and the Declaration on respect for human rights and the human rights strategy of KfW and its subsidiaries. In its financing activities, KfW Group takes care to avoid potential adverse impacts on people and the environment (including the climate) and associated risks, or to minimise or offset them through suitable actions where necessary. More detailed information is provided in the "Social matters at KfW Group" section in the "Social information" chapter.

On the other hand, environmental, social and governance matters can have an impact on KfW Group's strategy. The impacts described in this chapter have the potential to promote (positive impacts) or hinder (negative impacts) the primary objective of KfW Group as defined in the strategic objectives 2029. The material opportunities for consumers and end-users can affect the strategy and influence target figures depending on the form of the opportunities to be realised. In the context of the group-wide strategy process, possible changes to the strategic objectives 2029 are reviewed annually, as described at the beginning of this chapter. In addition, value chain workers, affected communities, and consumers and end-users are involved through stakeholder engagement formats to enable them to gain an understanding of issues concerning them. This may also have implications for the strategy. In this context, please refer to the "Interests and views of stakeholders" section of this chapter.

KfW Group-specific issues

Two material positive impacts and one material risk specific to KfW Group were identified in the materiality assessment (see table below). The ESRS topics were expanded to include material sustainability matters in the form of KfW Group-specific sustainability matters that were not covered or not covered with sufficient granularity by an ESRS. Please refer to the "Processes to identify material impacts, risks and opportunities" section of this chapter for further information on identifying material impacts, risks and opportunities.

KfW Group-specific issues

Corporate and public clients

Dimension: banking business
Type: positive impact
Due to their size, small and medium-sized enterprises (SMEs) are at a structural disadvantage compared to other, larger companies when it comes to raising capital. KfW Group's financing offering can mitigate such structural disadvantages by improving SME access to financing and promotional products.

Promotion of sustainable transformation

Dimension: banking business
Type: positive impact
KfW Group endeavours to promote and fund the sustainable transformation of enterprises and public institutions.

Bank-specific ESG risks

Dimension: banking business/banking operations
Type: risk
Bank-specific ESG risks can result from credit and equity investment risk due to inadequate governance at counterparties as well as societal changes and greater customer expectations regarding ESG transparency. They can also occur in connection with operational risks, such as information security risk. Information security risks could occur if KfW Group does not keep up with the latest digital technologies for protection against cyber threats. Furthermore, bank-specific ESG risks are associated with compliance risks such as potential violation of laws on trade embargoes, bribery, corruption and market manipulation.

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KfW Group promotes SMEs and the sustainable transformation of enterprises and public institutions. In order to improve access to financing and promotional products for SMEs, KfW Group offers financing and promotional products specifically for this customer group. This offering is intended to reduce the structural disadvantages in raising capital that SMEs face and have a positive impact on them. The favourable impact on SMEs dovetails with the principle of subsidiarity set out in the strategic objectives 2029. The business strategy also provides for upfront fees as an incentive to sales partners to process microloans and for product-related marketing and sales activities (e.g. for product campaigns or to reinforce the sales position). Furthermore, the strategic objectives 2029 provide for an SME share of more than 40% in financing German SMEs in domestic promotion, which directly contributes to the promotion of SMEs. Financing for the sustainable transformation of enterprises and public institutions is in line with and promotes the purpose enshrined in the strategic objectives 2029. Specifically, financing for the sustainable transformation is tied in with the strategic business objectives through the environment quota (see the "Environment quota" section in the "Environmental information" chapter), the 1.5°C target (see the "1.5°C alignment of KfW's financing activities" section in the "Environmental information" chapter) and the implementation of the sector guidelines (see the "Paris-aligned sector guidelines" section in the "Environmental information" chapter).

KfW Group created a sub-project within the "tranSForm" project to further develop the management of ESG risks until the end of 2024. The key aspects of the project were creating a central tool to record the ESG risks of KfW Group's counterparties – the ESG risk profile – utilising the risk profile information in other risk instruments, and taking account of ESG risks in risk and overall bank management processes. This also includes performing a comprehensive ESG risk driver analysis as part of the risk inventory, which supports the materiality assessment carried out in line with the ESRS. For further information, refer to the "Disclosures on ESG risks" section of this chapter.

Materiality assessment

In order to determine the scope of the sustainability report, KfW Group performed a materiality assessment in accordance with the principle of double materiality as set out in ESRS 1. The aim of the assessment is to determine the material impacts, risks and opportunities in relation to the topic-specific sustainability matters specified in the ESRS and, where applicable, other company-specific sustainability matters. The sustainability matters determined to be material on the basis of this analysis constitute the total requirements to be reported, which are to be included in the sustainability report in addition to the ESRS 2 mandatory disclosures. In an iterative process, KfW Group first identified the impacts, risks and opportunities potentially relevant to it and then assessed their materiality. Materiality is assessed in a multi-stage decision-making process: firstly, in a workshop-based process by informed internal contacts who are familiar with sustainability matters from their respective organisational entity and who are normally decentralised sustainability officers. The assessment was then checked for consistency by the party with overall responsibility for the materiality assessment and, where necessary, assessment proposals were developed for impacts, risks and opportunities on which the informed internal contacts were unable to reach assessment consensus. The CSO approved the results and the decision on assessment proposals. The Executive Board then received the results for information purposes.

KfW Group performed the materiality assessment for the first time for the 2024 reporting period. The completeness of the impacts, risks and opportunities, and the circumstances that influence their assessment will be reviewed in future as part of an annual materiality re-evaluation. On this basis, adjustments will be made to the materiality assessment as indicated. The next review will be performed on 30 June 2025 for the 2025 reporting period.

Processes to identify material impacts, risks and opportunities

In accordance with ESRS 1, a sustainability matter is considered material if it is assessed as material either from an inside-out perspective (taking account of KfW Group's impact on people and the environment) or from an outside-in perspective (taking account of the risks and opportunities arising from sustainability matters) (principle of double materiality). The basis for identifying the impacts, risks and opportunities was formed by 22 sub-topics of environment, social and governance topics, which were derived from the topics listed in the ESRS and supplemented by sustainability matters specific to KfW Group.

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To determine and assess the impacts, risks and opportunities for KfW Group, KfW, all subsidiaries and the value chain with upstream and downstream activities were taken into account. If impacts, risks or opportunities do not relate to KfW Group in general, but to specific activities, geographical regions, business relationships or subsidiaries, these were identified and documented. The contents of the report are presented on the basis of group-level materiality. KfW Group analyses and assesses the "banking business" and "banking operations" dimensions separately in the materiality assessment, in order to adequately consider and assess impacts, risks and opportunities arising from its own activities (including upstream activities) as well as those from business relationships. For a definition of those terms please refer to the "Business model and strategy in the context of material impacts, risks and opportunities" section in this chapter.

The impacts were assessed on the basis of the categories "scale", "scope", "irremediable character" (in the case of negative impacts) and "probability of occurrence" (in the case of potential impacts). This yielded a materiality score between 0 (low) and 15 (very high) for each impact. Impacts with a materiality score of 8 or higher are considered material. Financial materiality exists when risks or opportunities have or are expected to have a material impact on KfW Group's cash flow, development, performance, financial position, cost of capital or access to finance over the short, medium or long term. The materiality of risks and opportunities (financial materiality) was assessed based on the magnitude of the financial effects and the estimated probability of occurrence. Each risk and opportunity was assigned a materiality score on a scale of 0 (no effect/unlikely) to 5 (very significant financial effect/highly likely), with a score of at least 3 deemed material. The risks and opportunities were assessed in the context of the impact assessments in topic-related workshops, in order for any existing interdependencies between the impacts and risks or opportunities to be taken into account. The relevant thresholds for materiality were determined based on the EFRAG recommendations in accordance with (Draft) ESRG 1 "European Sustainability Reporting Guidelines 1 Double materiality conceptual guidelines for standard-setting".

KfW Group drew on various internal and external sources and expert assessments from internal and external contacts to identify and assess impacts, risks and opportunities. The following documents in their current versions, among others, were used for the initial collection: GRI Sustainability Report and Financial Report of KfW Group, exclusion lists (see the "Exclusion lists at KfW Group" section in the "Environmental information" chapter), the Paris-aligned sector guidelines (see the "Paris-aligned sector guidelines" section in the "Environmental information" chapter) and the results of SDG mapping (see the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter). Additional data sources were used to quantitatively corroborate the expert assessments, including the ESG risk inventory, the statistics on reputational risk events, the new product process and the group-wide strategy process. To ensure the consistency of the results with KfW Group's strategic objectives and publications, the KfW Law, the strategic objectives 2029, the sustainability mission statement and the "Sustainability strategy" section of the business strategy as well as relevant KfW Group media publications were reviewed.

KfW Group also included the perspectives of external stakeholders to analyse the positive and negative impact on people and the environment. Across the group-wide value chain and in line with the definition of stakeholders pursuant to the ESRS, the focus was on twelve stakeholder groups: civil society, lobbyists, regulators, investors, public sector clients, data providers/IT service providers, the Federal and state governments, the Executive Board and Board of Supervisory Directors, employees, business and corporate clients including banks, financing partners and customers (including the promotional business). Their views were incorporated in particular via findings from engagement formats with affected stakeholders already undertaken by KfW Group. This comprised the complaints reports for the business sectors SME Bank & Private Clients, Customised Finance & Public Clients and KfW Development Bank, as well as the separate complaints report for KfW Development Bank. For the first report based on the ESRS a one-time survey of stakeholder views was also carried out in a total of 15 interviews in 2023.

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Linking the materiality assessment and the general risk management process

The materiality of ESG risk drivers is assessed at KfW Group by means of the risk inventory, which comprehensively defines and categorises the ESG risk drivers. Possible effects on KfW Group's risk types are estimated on the basis of interdependencies. The aim is to identify material ESG risk drivers and take these into account in the materiality assessment of the risk inventory. The assessment also considers the probability of occurrence criteria and the anticipated financial effects (amount of loss) in order to determine the contribution of an ESG risk driver to the materiality of a risk type (e.g. credit risk or operational risk). All ESG risk drivers that contribute to a risk type classified as material overall for the group are also classed as material in this report. As a result, they were included in the materiality assessment according to the ESRS. Not every material ESG risk driver is clearly topically attributable to an ESRS standard. These risk drivers are therefore listed under the KfW Group-specific topic "Banking sector-specific ESG risks". The management and supervisory bodies of KfW Group monitor and manage the ESG risk drivers assessed as material in the materiality assessment as part of KfW Group's general risk monitoring and management. For additional information on monitoring and management processes, please refer to the "Organisation of risk management and monitoring" section in the "Risk report" chapter.

Information provided to the Executive Board and Board of Supervisory Directors on material impacts, risks and opportunities

The process described in this section to determine the material impacts, risks and opportunities ensures that the materiality assessment is closely linked to the existing processes in terms of risks (e.g. the ESG risk inventory), opportunities (e.g. the group-wide strategy process or new product process) and impacts (e.g. SDG mapping). The Executive Board and Board of Supervisory Directors are involved in the existing processes by various means through which they address the material risks, opportunities and impacts of KfW Group. For instance, the Executive Board receives a risk report once a month on the bank's overall risk situation (including risk drivers relating to sustainability matters), and the Board of Supervisory Directors is also regularly informed about the risk situation (at least once per quarter). Furthermore, the Executive Board addresses sustainability matters concerning KfW Group on an ad hoc basis in Executive Board discussions triggered by internal projects (e.g. BioDiv-Roadmap, Employer positioning and "tranSForm").

Processes to identify material climate-related impacts, risks and opportunities

To identify material climate-related impacts, risks and opportunities, KfW Group applied the "Processes to identify material impacts, risks and opportunities" in a similar manner. In addition, KfW Group has determined the actual greenhouse gas emissions for 2024 for both its own operations and the financed portfolio. For further information, please refer to the "Greenhouse gas emissions" section in the "Environmental information" chapter. As part of the materiality assessment, the participating experts assessed the potential and future impact of KfW Group's business activities on climate change. This assessment was performed in accordance with the process described in this chapter.

Physical and transition climate risks (outside-in perspective) are determined at several management levels. This is done partially in the risk inventory (see the "Disclosures on ESG risks" section of this chapter). In the case of business partners, physical climate risks are assessed using an application developed in-house. The result of the ESG risk profile reflects the potential financial effects of ESG risks that may arise within a reasonably long period of time, taking into account the foreseeable future. Similarly to the rating methodology, the forecast takes into account a company's susceptibility to adverse ESG developments and unanticipated ESG events. The assessment includes both aspects relating to the past with considerable significance for the future development of the company and current/forward-looking factors. The result of the assessment of ESG risks (very low to very high) reflects the risk materiality (potential financial effect of the risk) as well as the expected time horizon until the risk occurs. Longer periods of time before ESG risks materialise may give the company more time to adapt to them. Shorter periods may increase the risk. Given the individual character of each business partner and sector, a generally applicable definition of limits for time periods is not envisaged, as otherwise there is a risk of omitting relevant information. Stress testing also addresses the level of identification and management of (portfolio) risks.

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Physical climate risks and their potential impact on business activities and risk-bearing capacity are also analysed in stress tests. A stress test on drought risk in combination with social unrest in selected countries was carried out in 2023 (see 2023 Sustainability Report). KfW Group prepared a combined flood and heavy rain stress test for the first time in 2024. The scenario involves using hazard maps with a specified probability of occurrence (e.g. flood of the century) to simulate a location-based assessment of the costs incurred in the scenario by a business partner in terms of its fixed assets and other effects of the event (e.g. destruction of infrastructure). On this basis, a change in the probability of default and the loss given default for the next three years is calculated with the aim of quantifying stressed credit risk indicators such as the expected loss. Given that the 2024 stress test on physical climate risks relating to flooding as an ESG risk driver will be performed during the first quarter of 2025 for the first time, there were no results available at the time of preparing this report. The results will be reported starting in financial year 2025 with retroactive effect.

Transition climate risks and their impact on KfW Group's business activities and risk-bearing capacity were also simulated over a long-term period from 2024 to 2050. This involved analysing the scenarios "Net Zero 2050", "Disorderly Transition", "Fragmented World" and "Nationally Determined Contributions" of the NGFS, which provide for the introduction of cross-sector carbon pricing in various forms. In addition to carbon prices, the stress test also takes into account rising energy prices and changing customer behaviour towards a sustainable economy and its products. The orderly "Net Zero 2050" scenario assumes that transition of the economy will commence immediately, while the "Disorderly Transition" scenario assumes it will start in 2030. The NGFS "Nationally Determined Contributions" ("NDCs") scenario describes a world in which countries implement their contributions to reducing greenhouse gas emissions in accordance with the Paris Agreement, which are currently pledged at national level. In this scenario, the average temperature rise is estimated to be over $2^{\circ}\mathrm{C}$ by 2050 and over $3^{\circ}\mathrm{C}$ by 2100. In the NGFS "Fragmented World" scenario, there are no globally coordinated measures for setting carbon pricing paths. This results in an inconsistent and fragmented policy with regard to pricing $\mathrm{CO}_{2}$ emissions. The scenario assumes average global warming of $2.3^{\circ}\mathrm{C}$ by 2100. In the scenarios, the companies analysed can pass on some of the carbon costs to customers based on sector-dependent parameters. The stress test simulates the long-term development of credit risks in the corporate portfolio. The expected annual loss of the portfolio was used as a risk measure to indicate the development in risk provisioning. In addition, scenario-based emission paths are taken into account, which depend on the carbon price applied in each case, and a balance sheet projection that takes into account existing KfW Group strategy programmes, in particular for reducing greenhouse gas emissions. The assessment period up to 2050 means that transition portfolio risks, which primarily have a long-term impact and whose negative impact is particularly material for the greenhouse gas-intensive sectors, can be studied.

The "Net Zero 2050" and "Delayed Transition" scenarios both show the largest spikes in expected losses per year until 2050. The price increases for $\mathrm{CO}_{2}$ emissions and energy are very high in both scenarios in order to achieve the $1.5^{\circ}\mathrm{C}$ target of the Paris Agreement, primarily affecting emission-intensive sectors. At the same time, these two scenarios also see the largest reduction in forecast emissions of the borrowers in the observed portfolio. There is major uncertainty regarding the potential impacts of transition climate risks on the assets and business activities of KfW Group, with a particular view to the long-term time horizon relevant to this risk. The uncertainty is addressed in the stress test presented by analysing four different climate scenarios and subjecting the assumptions made to a critical evaluation, which is also included in the communication of results. The results of the stress test on transition climate risks are also included in the process to determine the business strategy. In future, climate stress tests for transition risks will continue to focus on long-term assessment periods in order to create a strategic roadmap for overall bank management.

In assessing its scenarios on structural risks, KfW Group also analysed on a quarterly basis in 2024 a scenario with a rapid rise in carbon prices and a time horizon from 2024 to 2027. The scenario is based on the following assumptions: Led by the western industrialised nations, the world begins an ambitious climate action programme from 2024 with the aim of achieving global carbon neutrality by 2050, while adhering to the Paris climate plan of maximum global warming of $1.5^{\circ}\mathrm{C}$. Based on the NGFS "Net Zero 2050"

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scenario, carbon prices in industrialised countries would increase linearly from EUR 120/t of CO₂ in 2024 to EUR 170/t of CO₂ in 2027, while the carbon price increase in developing countries and emerging economies would be lower. Greenhouse gas-intensive industries in particular would be negatively affected by the high carbon prices. A sharp rise in carbon prices would also lead to a decline in economic performance in the countries/regions affected.

Climate-related opportunities and risks are taken into account via the group-wide strategy process. For further information please refer to the "KfW business model" section in the "Basic information on KfW Group" chapter and the "General economic environment and development trends" section in the "Forecast and opportunity report" chapter. The financial report does not yet use any climate-related critical assumptions.

Processes to identify materiality relating to pollution, water and marine resources, biodiversity, and resource use and circular economy

In order to identify material impacts, risks and opportunities in the areas of pollution, water and marine resources, resource use and circular economy, and biodiversity as well as dependencies related to biodiversity and ecosystems, KfW Group applied the process described in the section "Processes to identify material impacts, risks and opportunities", including the assessment criteria. In a similar manner, the company's own locations (banking operations) and the upstream and downstream value chain, including the banking business, were analysed separately. The process also analysed transition risks, physical risks and opportunities related to biodiversity and ecosystems. Systemic risks and ecosystem services were not analysed separately in this context.

The result of the analysis determined negative impacts on biodiversity caused by KfW Group's financing to be material. These may potentially also have a negative impact on affected communities (such as the pollution-related impacts identified as material). KfW Group provides complaints channels and mechanisms to ensure that any concerns of affected communities are adequately heard. There were no other specific consultations for the materiality assessment. Instead, the concerns of the communities were taken into account by analysing the complaint reports of the domestic business sectors and KfW Development Bank. Furthermore, the participants in the materiality assessment workshops included the perspective of affected communities in their assessment. No sites were identified where pollution is of material significance for the activities and the upstream and downstream value chain. Based on the WWF Biodiversity Risk Filter, a review was conducted to determine whether KfW Group sites are located in or near biodiversity-sensitive areas and ecosystems in need of conservation. KfW Group has such sites. However, no negative impacts were identified in this context, as the majority of these are small sites with few employees in the centre of the respective city, or the cities already have mitigating conservation plans in place.

KfW Group's business activities that have a material impact on pollution are listed below. No material opportunities or risks were identified in this context.

The following business activities may contribute to the reduction of pollution by financing environmental protection projects:

National and international financing under promotional programmes such as the KfW Environmental Protection Programme, Environmental Innovation Programme and KfW Syndicated Loan Sustainable Transformation
Promotion of development projects in developing countries and emerging economies on behalf of the Federal Government with promotional products such as grants, development loans and promotional investments
National and international direct financing and credit lines with banks
Investment via venture capital, venture debt and private equity funds

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The following business activities may involve financing projects or companies in particularly environmentally harmful industries or with high pollutant emissions:

National and international financing via promotional programmes
National and international direct financing including export and project financing
Mandated transactions
Financing private equity funds and financing of credit lines with banks

When conducting business activities in connection with financing projects or companies in the most environmentally harmful industries or industries with high pollutant emissions, a number of things should be noted. Firstly, it is not possible to name specific promotional programmes, as for one thing, there is generally no sector exclusion, meaning that companies in the segment of the most environmentally harmful industries or industries with high pollutant emissions are also entitled to avail themselves of the promotional programmes on offer. The financing itself, however, does not necessarily have a negative impact. For another thing, certain promotional programmes do not have a specific intended use (e.g. general corporate financing programmes such as the KfW Promotional Loan for large mid-sized companies), so not all negative effects can necessarily be ruled out. Secondly, direct financing can also be granted to borrowers that operate in the most environmentally harmful industries or industries with high pollutant emissions, without the financing itself having a negative impact. Thirdly, the restrictions of the Paris-aligned sector guidelines and the exclusion list, as well as consideration of the relevant sustainability guidelines for all business activities mentioned must be observed.

Processes to identify business conduct-related materiality

To identify the material business conduct-related impacts, risks and opportunities, KfW Group applied the method described in the "Processes to identify material impacts, risks and opportunities" section of this chapter in similar manner. The Compliance department was closely involved in the process to ensure that specific aspects were taken into account.

Materiality of climate change in banking operations

KfW Group does not consider the issue of 'climate change' to be material for its banking operations, as its capacity to influence – and consequently its impact on – climate change mitigation is limited. No financial materiality was identified in terms of banking operations either. The greenhouse gas ("GHG") footprint, which was calculated in full for the first time for 2024, confirms the assumption made in the materiality assessment that emissions from banking operations account for a very small proportion of KfW Group's total GHG footprint. For these reasons, it can be assumed that the issue of 'climate change' will continue to be considered material only for KfW Group's banking business in the future as well. This means that only the financed GHG emissions (Scope 3 category 15) of KfW Group are to be reported. However, operational GHG emissions (Scope 1, Scope 2 and other significant Scope 3 categories) would then not be part of this report and KfW Group's GHG footprint would be incomplete. To avoid this, the information on operational GHG emissions was voluntarily included in the sustainability report. For further information, refer to the "Greenhouse gas emissions" section in the "Environmental information" chapter.

Determining information identified as material

To identify the material impacts, risks and opportunities and therefore material sustainability information, KfW Group applied the processes including the thresholds described in the "Processes to identify material impacts, risks and opportunities" section of this chapter. The assessment was carried out jointly with the subsidiaries at the level of the individual sustainability matter. For reporting purposes, KfW Group aggregates the information from the subsidiaries at group level and reports it on a consolidated basis.

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List of disclosure requirements covered

The following table provides an overview of the material disclosure requirements in the sustainability report:

List of disclosure requirements covered in the sustainability report based on the results of the materiality assessment

Disclosure requirement	Sub-topic	Dimension	Section of sustainability report
ESRS 2 BP-1	General basis for preparation of the sustainability statements	Banking operations and banking business	- Basis for preparation of the sustainability report for KfW Group
ESRS 2 BP-2	Disclosures in relation to specific circumstances	Banking operations and banking business	- Basis for preparation of the sustainability report for KfW Group
ESRS 2 GOV-1	The role of the administrative, supervisory and management bodies	Banking operations	- Executive Board and Board of Supervisory Directors of KfW
- Structure and organisation of sustainability governance
ESRS 2 GOV-2	Information provided to and sustainability matters addressed by the undertaking's administrative, management and supervisory bodies	Banking operations	- Processes to identify material impacts, risks and opportunities
- Structure and organisation of sustainability governance
ESRS 2 GOV-3	Integration of sustainability-related performance in incentive schemes	Banking operations and banking business	- Executive Board and Board of Supervisory Directors of KfW
ESRS 2 GOV-4	Statement on due diligence	Banking operations and banking business	- Statement on due diligence in sustainability matters
ESRS 2 GOV-5	Risk management and internal controls over sustainability reporting	Banking operations and banking business	- Internal controls and risk management relating to sustainability reporting
ESRS 2 SBM-1	Strategy, business model and value chain	Banking operations and banking business	- Strategy, business model and value chain
- KfW Group's value chain
- Integrating sustainability matters into the business strategy
- Environment quota
- Diversity and inclusion
- Customers - Corporates
ESRS 2 SBM-2	Interests and views of stakeholders	Banking operations and banking business	- Interests and views of stakeholders
ESRS 2 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking operations and banking business	- Business model and strategy in the context of material impacts, risks and opportunities
- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy
- Processes to identify material impacts, risks and opportunities
ESRS 2 IRO-1	Description of the processes to identify and assess material impacts, risks and opportunities	Banking operations and banking business	- Materiality assessment
- Processes to identify material impacts, risks and opportunities
ESRS 2 IRO-2	Disclosure Requirements in ESRS covered by the undertaking's sustainability statements	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
- Determining information identified as material
ESRS E1 GOV-3	Integration of sustainability-related performance in incentive schemes	Banking operations and banking business	- Executive Board and Board of Supervisory Directors of KfW
ESRS E1 IRO-1	Description of the processes to identify and assess material impacts, risks and opportunities	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
ESRS E1 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking business	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy
- Processes to identify material impacts, risks and opportunities
ESRS E1 E1-1	Transition plan for climate change mitigation	Banking business	- Paris-aligned sector guidelines
- DEG Impact/Climate Commitments
ESRS E1 E1-2	Policies related to climate change mitigation and adaptation	Banking business	- Disclosures on ESG risks
- Environmental and Social Appraisal Guidelines
- Exclusion lists at KfW Group
- Paris-aligned sector guidelines
ESRS E1 E1-3	Actions and resources in relation to climate change policies	Banking business	- Disclosures on ESG risks
- Expansion of group-wide impact management
- Environment quota
- Environmental and Social Appraisal Guidelines
- Actions to achieve 1.5°C alignment for new financing
- DEG Impact/Climate Commitments

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List of disclosure requirements covered in the sustainability report based on the results of the materiality assessment

Disclosure requirement	Sub-topic	Dimension	Section of sustainability report
ESRS E1 E1-4	Targets related to climate change mitigation and adaptation	Banking business	- Disclosures on ESG risks
- Overarching environmental targets and actions
- SDG mapping of KfW's financing activities
- Environment quota
- Additional information on KfW Group's environmental targets
- 1.5°C alignment of KfW's financing activities
- DEG Impact/Climate Commitments
ESRS E1 E1-6	Gross Scopes 1, 2, 3 and Total GHG emissions	Banking operations and banking business	- Greenhouse gas emissions
ESRS E1 E1-9	Anticipated financial effects from material physical and transition risks and potential climate-related opportunities	Banking business	n/a
ESRS E2 IRO-1	Description of the processes to identify and assess material pollution-related impacts, risks and opportunities	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
ESRS E2 E2-1	Policies related to pollution	Banking business	- Environmental and Social Appraisal Guidelines
ESRS E2 E2-2	Actions and resources related to pollution	Banking business	- Expansion of group-wide impact management
- Environment quota
- Environmental and Social Appraisal Guidelines
ESRS E2 E2-3	Targets related to pollution	Banking business	- Overarching environmental targets and actions
- SDG mapping of KfW's financing activities
- Environment quota
- Additional information on KfW Group's environmental targets
ESRS E3 IRO-1	Description of the processes to identify and assess material water and marine resources-related impacts, risks and opportunities	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
ESRS E4 IRO-1	Description of the processes to identify and assess material biodiversity and ecosystem-related impacts, risks and opportunities	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
ESRS E4 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking business	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy
ESRS E4 E4-1	Transition plan and consideration of biodiversity and ecosystems in strategy and business model	Banking business	- Resilience of KfW Group's strategy and business model regarding biodiversity risks
ESRS E4 E4-2	Policies related to biodiversity and ecosystems	Banking business	- Disclosures on ESG risks
- Environmental and Social Appraisal Guidelines
ESRS E4 E4-3	Actions and resources related to biodiversity and ecosystems	Banking business	- Disclosures on ESG risks
- Expansion of group-wide impact management
- Environment quota
- Environmental and Social Appraisal Guidelines
- Biodiversity actions
ESRS E4 E4-4	Targets related to biodiversity and ecosystems	Banking business	- Disclosures on ESG risks
- Overarching environmental targets and actions
- SDG mapping of KfW's financing activities
- Additional information on KfW Group's environmental targets
ESRS E4 E4-6	Anticipated financial effects from biodiversity and ecosystem-related impacts, risks and opportunities	Banking business	n/a
ESRS E5 IRO-1	Description of the processes to identify and assess material resource use and circular economy-related impacts, risks and opportunities	Banking operations and banking business	- Processes to identify material impacts, risks and opportunities
ESRS S1 SBM-2	Interests and views of stakeholders	Banking operations	- Interests and views of stakeholders
ESRS S1 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking operations	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy

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List of disclosure requirements covered in the sustainability report based on the results of the materiality assessment

Disclosure requirement	Sub-topic	Dimension	Section of sustainability report
ESRS S1 S1-1	Policies related to own workforce	Banking operations	- Social matters at KfW Group
- Diversity and inclusion
- Remuneration
- Working conditions
- Procedures for engaging with the own workforce and workers' representatives
ESRS S1 S1-2	Procedures for engaging with the own workforce and workers' representatives about impacts	Banking operations	- Social matters in banking operations
- Working conditions
- Procedures for engaging with the own workforce and workers' representatives
- Complaints management
- Complaints channels for employees
ESRS S1 S1-3	Processes to remediate negative impacts and channels for own workers to raise concerns	Banking operations	- Complaints management
- Ombudsperson
- KfW's LkSG complaints procedure
- Complaints channels for employees
ESRS S1 S1-4	Taking action on material impacts on own workforce, and approaches to mitigating material risks and pursuing material opportunities related to own workforce, and effectiveness of those actions	Banking operations	- Social matters in banking operations
- Social matters at KfW Group
- Diversity and inclusion
- Remuneration
- Working conditions
ESRS S1 S1-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	Banking operations	- Diversity and inclusion
- Remuneration
- Working conditions
ESRS S1 S1-6	Characteristics of the company's employees	Banking operations	- Diversity and inclusion
ESRS S1 S1-8	Collective bargaining coverage and social dialogue	Banking operations	- Remuneration
ESRS S1 S1-9	Diversity metrics	Banking operations	- Diversity and inclusion
ESRS S1 S1-10	Adequate wages	Banking operations	- Remuneration
ESRS S1 S1-16	Compensation metrics (pay gap and total compensation)	Banking operations	- Remuneration
ESRS S1 S1-17	Incidents, complaints and severe human rights impacts	Banking operations	- Complaints channels for employees
ESRS S2 SBM-2	Interests and views of stakeholders	Banking business	- Interests and views of stakeholders
ESRS S2 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking business	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy
ESRS S2 S2-1	Policies related to value chain workers	Banking business	- Social matters at KfW Group
- Value chain workers and affected communities
ESRS S2 S2-2	Processes for engaging with value chain workers about impacts	Banking business	- Value chain workers and affected communities
ESRS S2 S2-3	Processes to remediate negative impacts and channels for value chain workers to raise concerns	Banking business	- KfW Group's grievance mechanisms
- Ombudsperson
- Group-wide complaints management in the banking business
ESRS S2 S2-4	Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing material opportunities related to value chain workers, and effectiveness of those actions	Banking business	- Social matters at KfW Group
- Value chain workers and affected communities
- Complaints management
ESRS S2 S2-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	Banking business	- Overarching environmental targets and actions
- SDG mapping of KfW's financing activities
- Value chain workers and affected communities
ESRS S3 SBM-2	Interests and views of stakeholders	Banking business	- Interests and views of stakeholders
ESRS S3 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking business	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy

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List of disclosure requirements covered in the sustainability report based on the results of the materiality assessment

Disclosure requirement	Sub-topic	Dimension	Section of sustainability report
ESRS S3 S3-1	Policies related to affected communities	Banking business	- Social matters at KfW Group
- Value chain workers and affected communities
ESRS S3 S3-2	Processes for engaging with affected communities about impacts	Banking business	- Value chain workers and affected communities
ESRS S3 S3-3	Processes to remediate negative impacts and channels for affected communities to raise concerns	Banking business	- Value chain workers and affected communities
- KfW Group's grievance mechanisms
- Ombudsperson
- Group-wide complaints management in the banking business
ESRS S3 S3-4	Taking action on material impacts on affected communities, and approaches to managing material risks and pursuing material opportunities related to affected communities, and effectiveness of those actions	Banking business	- Social matters at KfW Group
- Value chain workers and affected communities
- Actions related to value chain workers and affected communities
- Complaints management
ESRS S3 S3-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	Banking business	- Overarching environmental targets and actions
- SDG mapping of KfW's financing activities
- Value chain workers and affected communities
ESRS S4 SBM-2	Interests and views of stakeholders	Banking business	- Interests and views of stakeholders
ESRS S4 SBM-3	Material impacts, risks and opportunities and their interaction with strategy and business model	Banking business	- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy
ESRS S4 S4-1	Policies related to consumers and end-users	Banking business	- Social matters at KfW Group
- Customers - Consumers and end-users
ESRS S4 S4-2	Processes for engaging with consumers and end-users about impacts	Banking business	- Customers - Consumers and end-users
ESRS S4 S4-3	Processes to remediate negative impacts and channels for consumers and end-users to raise concerns	Banking business	- Customers - Consumers and end-users
- Complaints management
- Ombudsperson
- Group-wide complaints management in the banking business
ESRS S4 S4-4	Taking action on material impacts on consumers and end-users, and approaches to managing material risks and pursuing material opportunities related to consumers and end-users, and effectiveness of those actions	Banking business	- Social matters at KfW Group
- Customers - Consumers and end-users
- Group-wide complaints management in the banking business
ESRS S4 S4-5	Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and opportunities	Banking business	- Customers - Consumers and end-users
ESRS G1 GOV-1	The role of the administrative, supervisory and management bodies	Banking operations	- Executive Board and Board of Supervisory Directors of KfW Group
ESRS G1 IRO-1	Description of the processes to identify and assess material impacts, risks and opportunities	Banking operations	- Processes to identify material impacts, risks and opportunities
ESRS G1 G1-1	Business conduct policies and corporate culture	Banking operations	- Promoting and further developing the corporate culture
- Strategies relating to aspects of business conduct policies

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Overview of EU legislation taken into account in the sustainability report

This report includes datapoints deriving from other EU legislation where they are required to be reported under ESRS 2 or have been identified as material. These include datapoints from the Sustainable Financial Disclosure Regulation ("SFDR"), Pillar 3, the Benchmark Regulation and the European Climate Law. The following indicates whether and where these datapoints are stated in the report.

List of datapoints that derive from other EU legislation as listed in Appendix B of ESRS 2

Disclosure requirement	Datapoint	Materiality	Section of sustainability report
ESRS 2 GOV-1	Board's gender diversity paragraph 21 (d)	No reservation	- Executive Board and Board of Supervisory Directors of KfW
ESRS 2 GOV-1	Percentage of board members who are independent paragraph 21 (e)	No reservation	- Executive Board and Board of Supervisory Directors of KfW
ESRS 2 GOV-4	Statement on due diligence paragraph 30	No reservation	- Statement on due diligence in sustainability matters
ESRS 2 SBM-1	Involvement in activities related to fossil fuel activities paragraph 40 (d) i.	Not relevant	n/a
ESRS 2 SBM-1	Involvement in activities related to chemical production paragraph 40 (d) ii.	Not relevant	n/a
ESRS 2 SBM-1	Involvement in activities related to controversial weapons paragraph 40 (d) iii.	Not relevant	n/a
ESRS 2 SBM-1	Involvement in activities related to cultivation and production of tobacco paragraph 40 (d) iv.	Not relevant	n/a
ESRS E1-1	Transition plan to reach climate neutrality by 2050 paragraph 14	Material	- DEG Impact/Climate Commitments
ESRS E1-1	Undertakings excluded from Paris-aligned Benchmarks paragraph 16 (g)	Material	- DEG Impact/Climate Commitments
ESRS E1-4	GHG emission reduction targets paragraph 34	Material	- DEG Impact/Climate Commitments
ESRS E1-5	Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) paragraph 38	Not material	n/a
ESRS E1-5	Energy consumption and mix paragraph 37	Not material	n/a
ESRS E1-5	Energy intensity associated with activities in high climate impact sectors paragraphs 40 to 43	Not material	n/a
ESRS E1-6	Gross Scope 1, 2, 3 and Total GHG emissions paragraph 44	Material	- Greenhouse gas emissions
ESRS E1-6	Gross GHG emissions intensity paragraphs 53 to 55	Material	- Greenhouse gas emissions
ESRS E1-7	GHG removals and carbon credits paragraph 56	Not relevant	n/a
ESRS E1-9	Exposure of the benchmark portfolio to climate-related physical risks paragraph 66	n/a^{1)}	n/a^{1)}
ESRS E1-9	Disaggregation of monetary amounts by acute and chronic physical risk paragraph 66 (a)	n/a^{1)}	n/a^{1)}
ESRS E1-9	Location of significant assets at material physical risk paragraph 66 (c)	n/a^{1)}	n/a^{1)}
ESRS E1-9	Breakdown of the carrying value of its real estate assets by energy-efficiency classes paragraph 67 (c)	n/a^{1)}	n/a^{1)}

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List of datapoints that derive from other EU legislation as listed in Appendix B of ESRS 2

Disclosure requirement	Datapoint	Materiality	Section of sustainability report
ESRS E1-9	Degree of exposure of the portfolio to climate-related opportunities paragraph 69	n/a^{1)}	n/a^{1)}
ESRS E2-4	Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register) emitted to air, water and soil paragraph 28	Not material	n/a
ESRS E3-1	Water and marine resources paragraph 9	Not material	n/a
ESRS E3-1	Dedicated policy paragraph 13	Not material	n/a
ESRS E3-1	Sustainable oceans and seas paragraph 14	Not material	n/a
ESRS E3-4	Total water recycled and reused paragraph 28 (c)	Not material	n/a
ESRS E3-4	Total water consumption in m³ per net revenue on own operations paragraph 29	Not material	n/a
ESRS E4 SBM-3	paragraph 16 (a) i.	Not relevant	n/a
ESRS E4-SBM-3	paragraph 16 (b)	Material	– Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
ESRS E4 SBM-3	paragraph 16 (c)	Material	– Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
ESRS E4-2	Sustainable land / agriculture practices or policies paragraph 24 (b)	Material	– Specific disclosures on biodiversity in policies
ESRS E4-2	Sustainable oceans / seas practices or policies paragraph 24 (c)	Material	– Specific disclosures on biodiversity in policies
ESRS E4-2	Policies to address deforestation paragraph 24 (d)	Material	– Specific disclosures on biodiversity in policies
ESRS E5-5	Non-recycled waste paragraph 37 (d)	Not material	n/a
ESRS E5-5	Hazardous waste and radioactive waste paragraph 39	Not material	n/a
ESRS S1 SBM-3	Risk of incidents of forced labour paragraph 14 (f)	Material	– Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
ESRS S1 SBM-3	Risk of incidents of child labour paragraph 14 (g)	Material	– Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
ESRS S1-1	Human rights policy commitments paragraph 20	Material	– Social matters at KfW Group
ESRS S1-1	Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8 paragraph 21	Material	– Social matters at KfW Group
ESRS S1-1	Processes and measures for preventing trafficking in human beings paragraph 22	Material	– Social matters at KfW Group
ESRS S1-1	Workplace accident prevention policy or management system paragraph 23	Material	– Working conditions
ESRS S1-3	Grievance/complaints handling mechanisms paragraph 32 (c)	Material	– KfW’s LkSG complaints procedure
– Complaints channels for employees
ESRS S1-16	Unadjusted gender pay gap paragraph 97 (a)	Material	– Remuneration
ESRS S1-16	Excessive CEO pay ratio paragraph 97 (b)	Material	– Remuneration

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Financial Report > Combined non-financial report > General information

List of datapoints that derive from other EU legislation as listed in Appendix B of ESRS 2

Disclosure requirement	Datapoint	Materiality	Section of sustainability report
ESRS S2 SBM-3	Significant risk of child labour or forced labour in the value chain paragraph 11 (b)	Material	– Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
ESRS S2-1	Human rights policy commitments paragraph 17	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S2-1	Policies related to value chain workers paragraph 18	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S2-1	Non-respect of UNGPs on Business and Human Rights principles and OECD guidelines paragraph 19	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S2-1	Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8 paragraph 19	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S2-4	Human rights issues and incidents connected to its upstream and downstream value chain paragraph 36	Material	– Value chain workers and affected communities
ESRS S3-1	Human rights policy commitments paragraph 16	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S3-1	Non-respect of UNGPs on Business and Human Rights and OECD guidelines paragraph 17	Material	– Social matters at KfW Group
– Value chain workers and affected communities
ESRS S3-4	Human rights issues and incidents paragraph 36	Material	– Value chain workers and affected communities
ESRS S4-1	Policies related to consumers and end-users paragraph 16	Material	– Social matters at KfW Group
– Customers – Consumers and end-users
ESRS S4-1	Non-respect of UNGPs on Business and Human Rights and OECD guidelines paragraph 17	Material	– Social matters at KfW Group
– Customers – Consumers and end-users
ESRS S4-4	Human rights issues and incidents paragraph 35	Material	– Customers – Consumers and end-users
ESRS G1-1	United Nations Convention against Corruption paragraph 10 (b)	Material	– Strategies relating to aspects of business conduct policies
ESRS G1-1	Protection of whistle-blowers paragraph 10 (d)	Material	– Strategies relating to aspects of business conduct policies
ESRS G1-4^{2)}	Fines for violation of anti-corruption and anti-bribery laws paragraph 24 (a)	Not material	n/a
ESRS G1-4^{2)}	Standards of anti-corruption and anti-bribery paragraph 24 (b)	Not material	n/a

1) No information provided as the datapoint is not included due to the transition period in the 2024 reporting year
2) Matter pursuant to Sections 315c in conjunction with 289c HGB; addressed in the "KfW Group-specific issues" section of this chapter

Governance

The following information relates to the administrative, management and supervisory bodies of KfW as parent company of KfW Group. These are the Executive Board of KfW, the Board of Supervisory Directors and its committees (Presidial and Nomination Committee, Remuneration Committee, Risk and Credit Committee, and Audit Committee). KfW does not have a general shareholders' meeting. Some of the typical tasks performed by a general shareholders' meeting are assigned to the Board of Supervisory Directors in addition to its control and supervisory functions. The Executive Board does not include any representatives of trade unions or any of the group's own employee representatives. The Board of Supervisory Directors includes four representatives of trade unions and no members of the group's own employee representation bodies.

Executive Board and Board of Supervisory Directors of KfW

KfW's Executive Board is chaired by Stefan Wintels, currently comprises six members, and is responsible for managing business in accordance with the KfW Law, the KfW Bylaws and the procedural rules. In accordance with Article 1 (1) sentence 1 of the KfW Bylaws, the Executive Board members must be personally reliable and professionally qualified to assume their functions. Professional qualifications are understood within the meaning of Section 25c of the German Banking Act (Kreditwesengesetz – "KWG") and the Federal

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Financial Report > Combined non-financial report > General information

Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – “BaFin”) guidance notice on the fitness and propriety of management board members and members of administrative or supervisory bodies pursuant to the KWG, the German Payment Services Supervision Act (Zahlungsdiensteaufsichtsgesetz – “ZAG”) and the German Investment Code (Kapitalanlagegesetzbuch – “KAGB”), in which BaFin explains the professional and personal requirements for persons who are appointed as members of management under the respective supervisory laws. Under Section 25c (1) sentence 2 KWG, a prerequisite of the professional qualifications is adequate theoretical and practical knowledge of the business concerned, as well as managerial experience. Pursuant to Section 25c (1) sentence 3 KWG, the professional qualifications necessary for managing an institution can generally be assumed if three years’ managerial experience at an institution of comparable size and type of business can be demonstrated. Requirements in terms of the necessary experience for a position to be filled on the Executive Board are defined in the respective job descriptions with candidate profiles for positions on the Executive Board of KfW, which are drawn up by the Presidial and Nomination Committee of the Board of Supervisory Directors (see below) in accordance with Article 11 (1) no. 4 of the KfW Bylaws. On this basis, the Presidial and Nomination Committee identifies suitable candidates to fill a position on the Executive Board and proposes appointments to the Board of Supervisory Directors. None of the Executive Board members received variable components in their remuneration in 2024. There are thus no separate incentives provided with regard to sustainability (including climate-related considerations), as the financing and promotion of sustainable development form part of the Federal Government’s mandate, making them an integral component of KfW’s business model and strategy.

The supreme controlling body is the Board of Supervisory Directors, which also appoints and dismisses members of the Executive Board. It is responsible for advising and constant monitoring of the conduct of KfW’s business activities and the management of its assets. In accordance with the KfW Law, the Board of Supervisory Directors has 37 members, none of whom assume a management role within KfW. Article 7 of the KfW Law influences the composition of the Board of Supervisory Directors and ensures that the sections of society that are relevant to KfW are represented on the Board of Supervisory Directors. Based on the composition prescribed in the KfW Law and the functions defined therein, the Board of Supervisory Directors as a whole must have the knowledge, skills and experience of the body as a whole required to perform its responsibilities. The members of the Board of Supervisory Directors must have the necessary expertise to perform their office and must be reliable, sufficiently independent and able to commit sufficient time to the performance of their office (Article 7 (1) of the KfW Bylaws). The Federal Minister of Finance and the Federal Minister for Economic Affairs and Climate Action assume the position of Chair in alternating years pursuant to Article 7 (1) no. 1 of the KfW Law. In addition to seven federal ministers (Article 7 (1) nos. 1 and 2 of the KfW Law; automatic members by virtue of their office), 30 (81.1%) independent members of the Board of Supervisory Directors are appointed by the Federal Parliament (Bundestag), the Federal Council (Bundesrat) and the German Federal Government (Article 7 (1) nos. 3 to 7 of the KfW Law; appointed members). With the exception of the federal ministers, the members of the Board of Supervisory Directors are appointed for three years and roughly one third of the members are replaced every year (Article 7 (2) sentences 1 and 2 of the KfW Law).

Pursuant to Article 10 (3) sentence 1 of the KfW Bylaws, for the purpose of performing the responsibilities assigned to it, the Board of Supervisory Directors establishes committees from among its members pursuant to Articles 11 to 14 of the KfW Bylaws (Presidial and Nomination Committee, Remuneration Committee, Risk and Credit Committee, and Audit Committee). Pursuant to Article 10 (3) sentence 2 of the KfW Bylaws, the committee members must demonstrate the knowledge, skills and experience necessary to perform the respective responsibilities. Further provisions regarding the internal rules, composition and duties of the Board of Supervisory Directors and its committees are set out in Articles 10 to 14 of the KfW Bylaws, and other documents. The Presidial and Nomination Committee also regularly (at least once a year) assesses the knowledge, skills and experience of the individual members of the Executive Board and Board of Supervisory Directors and of each body in its entirety, pursuant to Article 11 (1) no. 6 of the KfW Bylaws. The process of assessing and evaluating these qualifications is based on KfW’s suitability guideline adopted by the Presidial and Nomination Committee, which set out specific criteria regarding suitability and expertise for the Executive Board and Board of Supervisory Directors. None of the members of the Board of Supervisory Directors received variable components in their remuneration in 2024; there are therefore no separate incentives with regard to sustainability (including climate-related considerations) for either the Executive Board or the Board of Supervisory Directors.

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Financial Report > Combined non-financial report > General information

The following table provides information on various aspects of diversity of the Executive Board and the Board of Supervisory Directors:

Diversity within the governing bodies of KfW in 2024

	Executive Board	Board of Supervisory Directors
	%	%
Percentage of female members	50.0	27.0
Percentage of male members	50.0	73.0
Percentage of members of other genders	0.0	0.0
No gender information provided	0.0	0.0
Average ratio of female to male members	100.0	37.0
Aged <30	0.0	0.0
Aged 30 ≤ 50	16.7	24.3
Aged >50	83.3	75.7

KfW offers its Executive Board members regular training to ensure that they have suitable skills and knowledge. This is also done on the basis of an existing concept for informing the Executive Board about relevant legal (regulatory) requirements and obligations. To expand their knowledge with regard to their role or regulatory matters, KfW additionally offers the 37 members of the Board of Supervisory Directors regular training courses by external experts. It also provides a budget for their participation in external training events. The trainings offered to the members of the Executive Board and Board of Supervisory Directors include "Current developments in sustainability", and "ESG risk management and controlling" with internal and external experts. A course was held for each of the Boards in the third and fourth quarters of 2024 concerning CSRD and ESRS requirements for sustainability governance, management of impacts, risks and opportunities, and sustainability reporting.

Structure and organisation of sustainability governance

The EU and the Federal Republic of Germany have committed to promoting sustainable development and implementing the 2030 Agenda with its Sustainable Development Goals ("SDGs") and to fulfilling the Paris Climate Agreement. KfW Group supports these sustainability targets. KfW Group's Chief Executive Officer bears overall responsibility for KfW Group's sustainability strategy and communication. The sustainability report is part of sustainability communication and the management report, and is therefore the responsibility of the Chief Financial Officer. Along with the Executive Board members responsible for the individual business sectors and the management boards of the subsidiaries, the CFO manages operational implementation of sustainability-related issues with regard to sustainable financing transactions.

It was necessary to further develop sustainability governance at KfW Group due to the increased importance of sustainability for banking business and the growing expectations of the stakeholders. The central role of the Group Development department was reinforced at mid-year through measures including establishing a CSO function, to improve coordination, transparency and prioritisation of group-wide sustainability activities. The CSO defines the sustainability strategy, which is an integral part of KfW Group's business strategy, and acts as a central point of contact for the Executive Board and Board of Supervisory Directors, e.g. with regard to monitoring sustainability matters. The CSO heads the division of the same name, which is part of the Group Development department in the CEO's area of responsibility and comprises the Sustainability Policy and Sustainable Finance Management teams. The latter team's responsibilities included managing the "tranSForm" project, such as the central management of the "SDG mapping" and "Paris alignment of KfW's financing activities" topics (see the "SDG mapping of KfW's financing activities" and "1.5°C alignment of KfW's financing activities" sections in the "Environmental information" chapter). The central discussion and decision-making body at senior management level for sustainable finance at KfW Group is the steering

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

committee from the "tranSForm" project. Following the end of the project as of 31 December 2024, the role will be taken over by the Sustainable Finance Committee ("SFC"). The SFC meets every two months, is chaired by the CSO and continues to support the Executive Board. The involvement of and information provided to the represented business areas (such as business sectors, Risk Controlling and Finance) will also be ensured via the SFC going forward, which will additionally support the implementation of uniform sustainable finance management throughout KfW Group. The aforementioned two teams work together to coordinate the work of the internal Network Sustainable Finance. The network serves to ensure the exchange of information, and coordinates and advances sustainable finance topics at the working level in all three areas of sustainability (environmental, economic and social). The name and rules of procedure of the network will be revised due to the creation of the SFC.

The proven decentralised operational integration and responsibility in the relevant business sectors, subsidiaries and central units continues alongside the central role of the Group Development department. Their sustainability officers play a key role in efficient interface management. Sustainability officers have been appointed in 15 departments and three subsidiaries of KfW Group (KfW IPEX-Bank, DEG, KfW Capital), where their duties include providing advice, impetus and further development, but also acting as a link, coordinator and communicator for their department and delivering input for sustainability reports and ESG ratings. Group Development works with them to develop proposals for decisions by the Executive Board on the strategic orientation of sustainability. The relevant business sectors, subsidiaries and central units can initiate additional targets and actions in a decentralised manner in the sustainability action areas banking business and banking operations. They can also suggest ideas on focus areas to supplement the orders issued by the Executive Board. KfW Group summarises the action areas and topics relating to sustainability matters on an annual basis in a sustainability programme with information on the progress and challenges associated with each topic.

The parties responsible for preparing the sustainability report provide the Executive Board with an annual overview of the material impacts, risks and opportunities for their information. The Executive Board is further involved as needed in adjustments to targets and actions in connection with impacts, risks and opportunities. The Board of Supervisory Directors regularly addresses the annual report, consolidated financial statements and annual financial reporting, which now also includes the sustainability report, at its spring meeting. Moreover, the Executive Board reports on sustainability issues on an ad hoc basis in the Board of Supervisory Directors meetings. Compliance with and performance of due diligence requirements with regard to sustainability matters at KfW Group are primarily ensured via the sustainability guidelines of the business sectors, subsidiaries and central units, of which the KfW human rights policy ("Declaration on respect for human rights and the human rights strategy of KfW and its subsidiaries") is an integral part. An overview of the core elements of due diligence with regard to sustainability is provided in the "Statement on due diligence in sustainability matters" section of this chapter. As part of the LkSG risk assessment, the Compliance department informs the Executive Board annually about the group's risk situation and makes detailed reports. More information on KfW Group's human rights policy is provided in the "Social matters at KfW Group" section in the "Social information" chapter.

For further information on strategic management, refer to the "Internal Management System" section in the "Basic information on KfW Group" chapter. Decisions are made in both the Executive Board and the Board of Supervisory Directors and its committees based on draft resolutions and oral discussions. Where needed, alternatives and (potentially interdependent positive or negative) impacts on quantitative control variables are assessed. The quantitative control variables that may potentially be discussed include promotion (e.g. environment quota), finance (e.g. costs and income), risk (e.g. risk-weighted assets ["RWA"] budget) and funding (e.g. funding needs).

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Financial Report > Combined non-financial report > General information

Statement on due diligence in sustainability matters

The following table indicates where in the sustainability report information can be found on the due diligence process at KfW Group, including the way in which the main aspects and steps of the due diligence process are applied:

Allocation of the core elements of the due diligence to the chapters of the sustainability report

Core elements of due diligence	Section of sustainability report
Embedding due diligence in governance, strategy and business model	- Business model and strategy in the context of material impacts, risks and opportunities
- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy
- Linking the materiality assessment and the general risk management process
- Processes to identify material impacts, risks and opportunities
- Executive Board and Board of Supervisory Directors of KfW Group
- Structure and organisation of sustainability governance
Engaging with affected stakeholders in all key steps of the due diligence	- Interests and views of stakeholders
- Materiality assessment
- Processes to identify material impacts, risks and opportunities
- Structure and organisation of sustainability governance
- Disclosures on ESG risks
- Additional information on KfW Group’s environmental targets
- Overarching guidelines
- Environmental and Social Appraisal Guidelines
- Exclusion lists at KfW Group
- Paris-aligned sector guidelines
- Social matters at KfW Group
- Diversity and inclusion
- Remuneration
- Working conditions
- Value chain workers and affected communities
- Customers – Consumers and end-users
Identifying and assessing adverse impacts	- Business model and strategy in the context of material impacts, risks and opportunities
- Assessment of the material impacts, risks and opportunities and their interaction with KfW Group’s strategy – materiality assessment
- Processes to identify material impacts, risks and opportunities
Taking actions to address those adverse impacts	- Strategy, business model and value chain
- Disclosures on ESG risks
- Expansion of group-wide impact management
- Environment quota
- Environmental and Social Appraisal Guidelines
- Actions to achieve the 1.5°C alignment for new financing
- Paris-aligned sector guidelines
- DEG Impact/Climate Commitments
- Biodiversity actions
- Resilience of KfW Group’s strategy and business model regarding biodiversity risks
- Social matters in banking operations
- Diversity and inclusion
- Remuneration
- Working conditions
- Value chain workers and affected communities
Tracking the effectiveness of these efforts and communicating	- Basis for preparation of the sustainability report for KfW Group
- Disclosures on ESG risks
- Overarching environmental targets and actions
- SDG mapping of KfW’s financing activities
- Environment quota
- Additional information on KfW Group’s environmental targets
- Greenhouse gas emissions
- 1.5°C alignment of KfW’s financing activities
- DEG Impact/Climate Commitments
- Diversity and inclusion
- Remuneration
- Working conditions
- Value chain workers and affected communities
- Customers – Consumers and end-users
- Customers – Corporates

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

Internal controls and risk management relating to sustainability reporting

Risk management in sustainability reporting is based on the established process-integrated internal control system ("ICS") of KfW Group. The reporting process for the sustainability report is embedded in the existing process landscape for financial reporting and the existing sustainability reporting. The established quality assurance and approval mechanisms can be used as a basis, with specifics relating to sustainability reporting based on the ESRS added and supplemented. As provided in the group-wide ICS methodology, a risk assessment is carried out during the process expansion, comprising risk identification, risk description and risk assessment. The risks are identified at the critical points in the relevant processes at which they may occur. The process-inherent risks are assessed using a uniform evaluation scheme in a risk matrix based on types of damage (e.g. financial, normative or reputational) and their probability of occurrence, and hedged in line with the matrix. The assessment is based on expert evaluations and available data (such as operational risk scenarios). This is documented in a risk control inventory. Risks arise at KfW in the context of sustainability reporting relating to the input of various quantitative data, in the categories of accuracy, completeness and data processing, as well as concerning (unpunctual) actual delivery. These risks are hedged by means of multi-stage decentralised quality assurance and approval processes (e.g. using multiple assessor verification). The established hedging mechanisms from financial reporting can be used as a basis for hedging the identified risks. Where other units outside of financial reporting are process owners, requirements for dealing with risks are developed, set down in writing and published as part of the "Restructuring sustainability reporting at KfW Group" project with the respective process owners. The results of the risk assessments and controls are transferred to the group-wide ICS rules and then shared with the Executive Board and Board of Supervisory Directors via the annual reporting implemented there. For further information on the group-wide ICS methodology and its application please refer to the "Additional internal control procedures" section of the risk report.

Disclosures on ESG risks

As is the case for all ESG risks, the ESG risks identified as material in the materiality assessment conducted in accordance with ESRS are not classed as an independent category of risk. Their contribution to the materiality of a risk type as a risk driver is assessed in the risk inventory. With respect to climate risks, KfW Group's material ESG risk drivers are primarily found in the area of credit risk. Material risk drivers concerning governance of counterparties are particularly relevant to credit and equity investment risk, whereas risk drivers concerning governance breaches by KfW Group and threats to the group's information security primarily relate to operational risk. Risk drivers concerning demographic change and the quality of customer relationships are particularly relevant to equity investment risk. For more detailed information on risk strategy and risk management, please refer to the "Organisation of risk management and monitoring" section of the risk report.

KfW Group has established a separate sub-project for ESG risks within the group-wide "tranSForm" project in order to reinforce ESG risk management. This sub-project realises the group's ESG risk management efforts but without pursuing a measurable, results-based objective within the meaning of the ESRS. The aim of the sub-project is to continue to develop ESG risk management at group level until the end of 2024, to improve the identification, assessment and management of ESG risks, and to meet the relevant regulatory requirements relating to ESG risks that apply to KfW Group. The central instrument for ESG risk management at KfW Group is the ESG risk profile – an application that records the ESG risks of the group's business partners. The risk profiles for banks, corporates, funds and securitisations are already in use, and the risk profile for countries was introduced in the first half of 2024. ESG risks were included in the risk management cycle and its instruments in line with the project plan until the end of 2024. The specific steps to further develop ESG risk management and thus also to achieve the target are explained in more detail in the next section.

KfW Financial Report 2024

Financial Report > Combined non-financial report > General information

The packages of measures under the "ESG risk management" tranSForm sub-project are broken down into meta-measures, and were defined based on existing regulatory requirements of national and European supervisory authorities in the context of ESG risk management. The meta-measures include the following topics and risk instruments: establishing an ESG risk profile database, integrating ESG risks into credit ratings, ensuring that ESG risks are adequately addressed in the risk strategy, business strategy, and risk appetite, valuation of collateral and in risk-bearing capacity. Other topics comprise further developing ESG risk stress testing capabilities, defining and reporting key performance indicators ("KPIs") and key risk indicators, establishing standard reporting for ESG and creating the option for ad hoc ESG reports, integrating the ESG risk view into the credit process, expanding the ESG risk inventory and specifying operational risks and reputational risks with regard to ESG risk aspects, assessing and realising need for action relating to market price risk in the context of ESG risks, and creating external transparency on the group's basic approach to ESG risk management. The meta-measures implemented apply throughout the group; there may be additional subsidiary-specific actions. The planned detailed work packages for each meta-measure were completed by the end of reporting year 2024.

The design and introduction of KPIs on transition, physical and other climate and environmental risks along with the definition of the corresponding risk appetite were reviewed and revised in the reporting year and completed by the end of financial year 2024. Actions already taken to deal with climate risks at KfW Group portfolio level were also constantly enhanced and expanded. This included assessment of transition climate risks in the portfolio using KfW's own "ESG risk profile" application for business partners and specific ESG stress tests. For a detailed description of the further actions to manage the risks identified as material as part of risk management and monitoring at KfW Group, please refer to the "Organisation of risk management and monitoring" section of the risk report.

KfW Group introduced a new internal policy in the reporting year: "ESG risk management". The policy is a comprehensive guide to dealing with ESG risks throughout KfW Group. The policy sets out the fundamental methods, tools and management processes used in connection with ESG risks. These include, in addition to the 7th MaRisk amendment, the ECB Guide on climate-related and environmental risks. The Risk Controlling department will assume responsibility for the policy with effect from 1 January 2025 following completion of the transForm project.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

Environmental information

As KfW Group's primary objective, sustainable promotion is at the heart of the strategic objectives 2029, in which KfW Group defines its targeted medium to long-term positioning. In line with the strategic transformation agenda KfWplus, these include the vision of positioning KfW as THE digital transformation and promotional bank. In this respect, climate and environmental aspects are of particular importance as part of the promotional principle of "sustainability" and the concept of "promoting transformation and boosting resilience". The strategic importance of these issues is also evident in the results of the materiality assessment performed by KfW Group for this report. The topics identified as material in the banking business are "climate change mitigation", "climate change adaptation", "energy", "pollution" and "biodiversity". These topics are therefore the focus of the "Environmental information" chapter. The chapter starts by presenting targets, actions and policies of KfW Group that relate to the material environmental aspects across all topic areas in an overarching section. These include targets and actions that relate to the SDG contribution of KfW's financing activities and the group-wide environment quota of financing, the sustainability policies of the business sectors, and the exclusion lists used with regard to environmental aspects. Further information on any topic-specific targets, actions and policies is provided in separate sections of the chapter, on climate and energy (including information on KfW Group's greenhouse gas emissions), pollution, biodiversity and material climate and biodiversity risks. Disclosures in accordance with Article 8 of the EU Taxonomy are also provided in this chapter.

Overarching environmental targets and actions

Three targets are embedded in the strategic objectives 2029 with respect to the topics "climate change mitigation", "climate change adaptation", "energy", "pollution" and "biodiversity" identified as material within the banking business:

SDG mapping of KfW's financing activities
1.5°C alignment of KfW's financing activities
Environment quota of financing of more than 38%

KfW Group considers the targets to be in line with the orientation of the promotional policy and the focus on sustainable transformation in Germany and around the world. These targets and the corresponding actions are described in further detail below (for the "1.5°C alignment of KfW's financing activities" target, see the corresponding section of this chapter).

SDG mapping of KfW's financing activities

The United Nations adopted the 2030 Agenda for Sustainable Development in 2015, covering the three dimensions environmental, social and economic. At the heart of the 2030 Agenda are 17 universal goals for sustainable development, the Sustainable Development Goals, or SDGs. KfW Group contributes to the achievement of all SDGs through its promotion and financing of governments, municipalities, companies and private individuals worldwide, and covered all SDGs with financing activities in 2024. The financing contribution to each SDG is displayed in the table below. To make the contributions to the global SDGs transparent, KfW Group aims to map 100% of annual new business to at least one Sustainable Development Goal. The group discloses the volume of financing allocated to each SDG (absolute volume in millions of EUR). A comprehensive review of the allocation is carried out for each financing. This is described in the following section. For a small number of financings, it was not possible to make a clear allocation to the SDGs in 2024. They are therefore not included in the SDG mapping. The group allocated 98.2% of new commitments to an SDG in financial year 2024.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

KfW Group financing contributions to the SDGs¹)

	New commitments 2024
	EUR in millions
SDG 1: No poverty	4,351
SDG 2: Zero hunger	569
SDG 3: Good health and well-being	3,464
SDG 4: Quality education	4,706
SDG 5: Gender equality	1,160
SDG 6: Clean water and sanitation	2,773
SDG 7: Affordable and clean energy	52,308
SDG 8: Decent work and economic growth	33,896²)
SDG 9: Industry, innovation and infrastructure	47,011
SDG 10: Reduced inequalities	4,258
SDG 11: Sustainable cities and communities	54,342
SDG 12: Responsible consumption and production	2,733
SDG 13: Climate action	51,756
SDG 14: Life below water	564
SDG 15: Life on land	1,425
SDG 16: Peace, justice and strong institutions	1,149
SDG 17: Partnerships for the goals	2,979

¹) KfW financing generally contributes to several SDGs at the same time.
²) Adjusted for non-recurring effects from mandated transactions to stabilise and secure the energy supply in Germany in the amount of EUR 8.5 billion in financial year 2024 carried out on behalf of the German Federal Government

KfW Group set the SDG contribution target voluntarily given that no harmonised, standardised indicators have yet been established for (promotional) banks to report their (financing) contributions to the SDGs. Accordingly, it also developed its own SDG mapping approach. The mapping process for "SDG eligible" financing takes account of the SDG requirements (with a focus on the preamble to the 2030 Agenda), and also considers whether activities are in line with the sustainability strategy of German Federal Government, the SDG Compass developed by the GRI, the UN Global Compact and the World Business Council for Sustainable Development, and whether the intended positive impact on the respective SDG is plausible in line with KfW Group's understanding of impact.

In order to present the SDG contribution of financing transparently, KfW Group examined the standard data recorded for new financing for such information that enables an indication on the intended positive impact on sustainable development in line with KfW's understanding of impact. Any negative effects on other SDGs are not offset. In terms of results, this includes the contribution of financing activities to the environment quota (for all business sectors), qualitative and quantitative impact indicators (DEG) and development markers (KfW Development Bank). For the results of customers and partners in the business sectors SME Bank & Private Clients and Customised Finance & Public Clients, KfW product categories are also used. Standardised purposes (KfW Development Bank), promotional product-specific classifications (SME Bank & Private Clients and Customised Finance & Public Clients) and sector classifications (DEG and KfW IPEX-Bank) are used at level of the financed activity as additional data fields to identify the intended positive impacts to achieve the SDGs. Compliance with international standards such as the IFC Performance Standards and performance of an E&S Appraisal (see the "Environmental and Social Appraisal Guidelines" section of this chapter) on the financing ensure that any conflicting targets and negative effects on achieving the SDGs are prevented or minimised. Compliance with KfW Group's exclusion list is also a fundamental requirement (see the "Exclusion lists at KfW Group" section of this chapter). Financing is eligible as an SDG contribution only when all the requirements are met.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

In the areas of “climate change mitigation”, “climate change adaptation”, and “energy” (including the use of renewable energy and energy efficiency) contributions of financing activities to SDG 7 and SDG 13 enable measurement of the intended positive impact of KfW Group and also demonstrate how KfW Group exploits the opportunities identified as material in these areas. The aim of SDG 7 is to ensure access to affordable, reliable, sustainable and modern energy worldwide. KfW Group considers financing to contribute to SDG 7 if the technologies involved either serve to further expand renewable energy sources or are classified as transitional technology to achieve the energy sector transformation (transitional technologies pursuant to the sector guidelines; see the “Paris-aligned sector guidelines” section of this chapter). Investments in increasing energy efficiency are also part of KfW Group’s commitment to achieving SDG 7. The objective of SDG 13 is to take urgent action to combat climate change and its impacts. KfW Group contributes to this goal by providing resources for climate change mitigation and adaptation both in Germany and internationally, and by supporting its project partners as needed in designing and executing their investments. In the area of climate change mitigation, it focuses on actions relating to renewable energy, energy efficiency, forest conservation/reforestation and environmentally friendly mobility. KfW Group’s contribution to SDG 13 also includes financing for climate change adaptation actions, such as investments in climate-resilient supply of drinking water and flood risk management.

In the area of “pollution”, the SDG contribution measures the intended positive contributions of KfW Group financing activities to minimising and preventing air pollutants, water pollution and soil pollution via KfW’s SDG mapping. This follows the SDG eligibility methodology described in this chapter and is not based on specific loads. Financing activities that contribute to minimising pollution are primarily allocated to the following SDGs: SDG 3 addresses problem areas that have an adverse effect on health and well-being, including pollution of air, water and soil. KfW Group financing that is mapped to this SDG includes infrastructure actions to secure minimum hygiene standards (such as sewage treatment facilities). Financing activities that contribute to minimising pollution are also mapped to SDG 6 and SDG 12. In addition to ensuring availability and sustainable management of water and sanitation for all, SDG 6 also concerns the challenge of ending contamination of water resources by untreated wastewater. In light of this, KfW Group includes both financing for wastewater disposal and promotional measures for modern waste management systems that prevent contamination of water resources. The aim of SDG 12 is to ensure sustainable consumption and production patterns. KfW Group financing activities deemed to make a contribution to this goal include promoting environmentally friendly production processes and wastewater treatment (see the “Environmental and Social Appraisal Guidelines” section of this chapter). To ensure compliance with the aforementioned standards, potentially negative impacts of financing activities on pollution are also examined, primarily by applying IFC Performance Standard 3 “Resource Efficiency and Pollution (2012)”.

In the area of “biodiversity”, the contributions of financing mapped to SDG 14 and SDG 15 show how KfW Group exploits the opportunity identified as material to expand financing for companies that contribute to biodiversity conservation through their activities. KfW Group’s intended positive contribution to biodiversity and ecosystems is also demonstrated through the mapping of financing to these SDGs. Therefore, the target is currently not based on any further (inter)national strategies or legal requirements in connection with biodiversity and ecosystems or ecological thresholds in line with its purpose. The main contributions to SDG 14 are environmental programmes for wastewater purification and treatment and promotional measures for maritime protected areas and sustainable fishing. The contribution to SDG 15 in Germany primarily comprises environmental programmes for soil and groundwater conservation, and in terms of KfW Group’s international activity, protected area management, sustainable forestry and combatting desertification. KfW Group’s financing activities in the area of biodiversity and ecosystems vary widely and can be allocated to different steps of the mitigation hierarchy (i.e. avoidance, minimisation, restoration and rehabilitation, and compensation or offsets) depending on the financing target and activity. Clear allocation of the “SDG mapping” target to a step of the mitigation hierarchy is therefore impossible. Aside from measurement of the intended positive contributions, potential conflicting targets and negative effects on achieving the SDGs with regard to biodiversity shall be minimised. This is achieved by examining potential negative impacts of financing using IFC Performance Standard 6 “Biodiversity Conservation and Sustainable Management of Living Natural Resources (2012)” (or Environmental and Social Standard [“ESS”] 6 of the World Bank at KfW Development Bank) as part of the E&S Appraisal (see the “Environmental and Social Appraisal Guidelines” section of this chapter). KfW Group also uses IFC Performance Standard 7 “Indigenous Peoples” (or ESS7 at KfW Development Bank) in the E&S Appraisal to ensure that the informed and willing consent of local and indigenous peoples is considered in financing activities, and that they are consulted as necessary.

KfW Financial Report 2024

KfW Group's understanding of impact is derived from the basic idea of demonstrating the process from financing up to the intended change or impact. SDG mapping is a first step in making KfW Group's financial contribution to achieving SDGs clear. The scope of the impacts on sustainability cannot currently be quantified through SDG mapping. For this reason, a group-wide impact management system has been established (see the following “Expansion of group-wide impact management” chapter).

Expansion of group-wide impact management

KfW Group's strategic efforts in the area of “sustainable financing” were grouped in six sub-projects under the “tranSForm” project until the end of financial year 2024. The aim of the project was to strengthen KfW's contribution to the SDGs and the Paris climate targets. It underscores KfW's aspiration to support the achievement of a greenhouse gas-neutral future in line with the Federal Government's mandate and its Climate Action Programme 2030 and the German Sustainable Finance Strategy. The main elements of “tranSForm” are governance, expansion of the impact management system, ensuring the 1.5°C alignment of KfW's financing activities, developing a GHG accounting system, even stricter inclusion of ESG risk factors in KfW Group's risk management (see the “Disclosures on ESG risks” section in the “General information” chapter), implementing financial sustainability reporting and data and IT support. A group-wide harmonised understanding of impact was established as part of the “tranSForm” sub-project “impact management” along with measurement of the sustainability-related impact of projects financed or co-financed by KfW have on sustainability. Group Development will be responsible for further developing group-wide impact management after completion of the “tranSForm” project, from 2025. Impact indicators that will continue to be developed were defined as part of impact management, based on the SDGs. The focus was on reinforcing the data basis for impact management in 2024. Corresponding procedural and technical developments were aimed at both general data availability and improving data quality. These further developments were devised and gradually realised in 2024. KfW Group had already developed methodologies for measuring GHG savings by 2023 for renewable energy and energy efficiency projects, and for the transport and mobility sector. The focus of this further development is on automated use of the existing methods going forward and centralised technical calculation of savings, unless the business sectors calculate their savings in a decentralised manner and not in line with the group-wide methodology. Technical implementation was phased in in 2024 and is initially focused on application cases relating to renewable energy. KfW Group will report on methodological advances and the measurement of specific impact indicators on an ongoing basis in the future.

Impact measurement is the focal point of impact management. There is therefore no plan to use biodiversity offsets, mitigation actions or local and indigenous knowledge. These aspects will be included, if necessary, in the E&S Appraisal (see the “Environmental and Social Appraisal Guidelines” section of this chapter).

Environment quota

The promotional priority area “climate change and environment” is included as an element in the strategic KfWplus transformation agenda. This key promotional area is to be further expanded with regard to the environment quota target. The target quota is defined in the strategic objectives 2029 and, for the reporting year, totals at least 38% of the annual new commitment volume. It represents the ratio of the eligible new commitment volume to KfW Group's total new commitment volume. KfW Group set itself the environment quota target voluntarily without the active involvement of stakeholders in order to ensure a continuously high promotional business volume in the “environment and climate change mitigation” priority area.

KfW Group has defined different eligibility criteria for financings to be included in the environment quota depending on the type of financing, which were developed based on the standard market level of ambition and the typical financing conditions of climate-related and environmental public promotional programmes. No other scientific findings were included in determining the criteria. The environment quota comprises the impacts and opportunities identified as material in the areas of “climate change mitigation”, “climate change adaptation”, “energy” and “pollution”. Promotional programmes, facilities, initiatives or credit lines with an explicit focus on the climate (including climate change adaptation) or environmental protection and resource conservation (including sewage treatment and air pollution control) are directly included in the environment quota. For individual promotional programmes, this may only apply to specific loan purposes. Project-related financing or corporate financing for renewable energy, e-mobility, carbon sinks, carbon capture and storage as well as for producing climate change-mitigation and climate-adaptation technologies are included directly. Specific reduction targets apply for including other project-related financing or corporate financing relating to climate change mitigation and other avoidance of pollution, particularly waste avoidance, wastewater treatment, air pollution control and noise control. In these cases, a proven reduction in resource

Financial Report > Combined non-financial report > Environmental information

consumption and environmental pollution of at least 15% is required. Including financing in the area of energy efficiency requires the demonstrable achievement of specific emission reductions (measured in CO₂ equivalents – “CO₂eq”) by at least 15% compared with the national industry average of existing assets in the case of new investments or 20% in the case of replacement investments. Beyond this, no loads are specified. The respective business sectors are responsible for compliance with the group-wide rules and for providing quality-checked data for consolidation. They can also define further, business-sector-specific criteria for the inclusion of financing in the environment quota. There have been no changes in the method used to calculate the environment quota since the previous year.

The environment quota of 44% at group level in 2024 was above the target of the strategic objectives (>38%) and slightly below the prior-year quota of 45%¹). Various developments were evident in the quota. For instance, promotional business opportunities were limited due to state-aid legislation with a high EU reference rate, which resulted in reduced commitments in the business sector SME Bank & Private Clients in promotional segments without state aid (such as commercial climate and environment financing). This was also apparent in the business sector Customised Finance & Public Clients from the low number of commitments to municipal enterprises and for the Sustainable Transformation syndicated loan. This situation had a negative effect overall on the volume of new business and the environment quota of financing at group level. The other business sectors made a positive contribution to the environment quota, primarily due to the higher pro-rata number of commitments relating to the environment by KfW Development Bank and business sector Export and project finance, KfW Capital's Green Transition Facility, and the increased focus of DEG's new business on climate and environment financing. The following table presents the new commitment volume and environment quota of the group and the individual business sectors.

KfW Group's new commitment volume and environment quota by business sector in 2024

Business sector	New commitments, total	Of which climate change and environment	Environment quota¹)
	EUR in billions	EUR in billions	%
SME Bank & Private Clients	35.8	20.7	58
Customised Finance & Public Clients	41.6	1.8	21²)
KfW Capital	1.6	0.1	4
Export and project finance³)	23.9	6.6	28
KfW Development Bank	7.8	4.7	60
DEG	2.5	1.2	48
Total²), ⁴)	112.8	34.7	44

¹) Percentage of total commitments for the business sector or business area
²) Adjustment for non-recurring effect from emergency aid and price cap for gas and heat on behalf of the Federal Government, special funding measures (including margining and gas storage facilities) and the hydrogen core network amortisation account
³) The environment quota in the core business of the business sector is 26%. Excluding the consolidation effect from domestic promotional export and project on-lending business, the environment quota is 28%.
⁴) Adjustment of KfW Group's total volume for commitments in export and project finance made from KfW domestic programme loans by EUR 0.4 billion

The following table shows the key actions in terms of promotional programmes and financing priorities for 2024 that contribute to achieving the environment quota. As a lever for the decarbonisation of the banking business, programmes and financing with a focus on climate and energy additionally contribute to the achievement of the group-wide target of “1.5°C alignment of new financing” (see the “1.5°C alignment of KfW's financing activities” section of this chapter) and compliance with the Paris-aligned sector guidelines (see the “Paris-aligned sector guidelines” section of this chapter).

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The business sectors' key contributions to the environment quota in 2024
Climate & energy

Business sector	Financing/promotional priority	Target group	Sustainability matter^{1)}
SME Bank & Private Clients	Federal Funding for Efficient Buildings
Provision of loans with interest subsidies and repayment bonus for the energy-efficient refurbishment of residential and non-residential buildings and the purchase of a newly refurbished efficiency building, grants for the purchase and installation of new, climate-friendly heating systems
Time horizon: ongoing	Including private, commercial and public-sector investors, private individuals, home owners' associations, companies, municipal enterprises, self-employed, non-profit organisations, contractors	Climate and energy	10.0
	Climate-friendly Construction Residential Buildings, Non-residential Buildings, Residential Property for Families
Construction or first purchase with high energy-efficiency standards (Efficiency House 40 or Efficiency House 55 in the low-price segment) and demonstrably low GHG emissions ("Sustainable Building Plus Quality Label", "Sustainable Building PREMIUM Quality Label")
Time horizon: ongoing	Private individuals, homeowners' associations, companies, municipal enterprises, self-employed, non-profit organisations	Climate and energy	7.7
	Climate action campaign for corporates
Financing of investments within the EU to reduce, avoid and eliminate GHG, based on EU taxonomy technical criteria
Time horizon: ongoing	Including companies, municipal enterprises, self-employed	Climate and energy	1.6
	KfW Environmental Protection Programme
Promotion of nature-based climate change mitigation and biodiversity actions in companies with a focus on the maintenance, re-naturalisation and restoration of semi-natural ecosystems and measures to unseal and re-naturalise soil and for natural, decentralised rainfall management on private companies' commercially used land
Time horizon: ongoing	Companies and the self-employed	Climate, pollution and biodiversity	0.8
	Financing projects in energy generation, distribution and efficiency, including renewable energy and energy efficiency, and projects for the design of sustainable urban transport and the development of rural roads in developing countries and emerging economies on behalf of the Federal Government
Time horizon: ongoing	Developing countries and emerging economies	Climate and energy	2.5
KfW Development Bank	Financing of projects on behalf of the Federal Government in the area of environmental protection in general, including biodiversity, and water, wastewater and waste disposal in developing countries and emerging economies
Time horizon: ongoing	Developing countries and emerging economies	Pollution and biodiversity	1.2

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The business sectors' key contributions to the environment quota in 2024
Climate & energy

Business sector	Financing/promotional priority	Target group	Sustainability matter^{1)}
Customised Finance & Public Clients	IKK – KfW Investment Loans for Municipalities
Promotion of investments by municipalities in municipal infrastructure
Time horizon: ongoing	Municipal authorities, their legally dependent self-operated companies (Eigenbetriebe), regional municipal associations (Gemeindeverbände) and special-purpose municipal associations (kommunale Zweckverbände)	Climate and energy	0.5
Sustainable Mobility Investment Loan
Promotion of investments in sustainable and climate-friendly mobility based on the EU taxonomy criteria
Time horizon: ongoing	Including companies, municipal enterprises, self-employed	Climate and energy	0.3
Federal Funding for Efficient Buildings – Municipalities
Promotion of refurbishment and purchase of a newly refurbished efficiency building
Time horizon: ongoing	Municipal authorities, their legally dependent self-operated companies, regional municipal associations and special-purpose municipal associations	Climate and energy	0.3
Climate-friendly Construction Municipalities – Residential and Non-residential Buildings
Promotion of new construction and first purchase of climate-friendly residential buildings, homes and non-residential buildings in Germany
Time horizon: ongoing	Municipal authorities, their legally dependent self-operated companies, regional municipal associations and special-purpose municipal associations	Climate and energy	0.2
“Nature-based solutions for climate and biodiversity in municipalities” promotional programme
Promotion in the areas of semi-natural green space management, tree-planting and the creation of natural oases such as local climate-ready parks and small bodies of water, nature-experience areas and urban forests and forest gardens
Time horizon: 2024	Municipal authorities, regional and special-purpose municipal associations	Climate and biodiversity	0.2
Export and project finance	Export and project finance in the Energy and Mobility sector departments, for example financing for wind farms and rail transport
Time horizon: ongoing	Corporate customers with a regional focus on countries in the EU, North America and selected emerging economies	Climate and energy	5.0
DEG	Financing climate and environmental protection projects with a focus on renewable energy projects in Africa, Asia and Latin America to promote the generation and use of green electricity in developing countries
Time horizon: ongoing	Corporate customers with investments in developing countries and emerging economies	Climate and energy	0.4
KfW Capital	“Green Transition Facility” investment programme
Investments in venture capital funds and venture debt funds with a focus on “climate tech” and related climate-relevant topics (definition based on the EU Taxonomy Regulation 2020/852)
Time horizon: 2024	Start-ups and innovative technology companies with a focus on environmental change	Climate and energy	0.1

1) The sustainability matter defines the topics addressed by the action. The consideration of biodiversity offsets or inclusion of local and indigenous knowledge depends on the project and, where necessary, takes place within the framework of the E&S Appraisal, for example through the use of the IFC Performance Standards (see the "Environmental and Social Appraisal Guidelines" section of this chapter).

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In addition to the topics already listed, KfW Group has identified the sustainable transformation of corporate customers and public institutions as an overarching material topic in the area of climate and environment. KfW Group's contributions relating to sustainable transformation are also pursued with the objectives set in connection with the SDG contribution of KfW's financing activities, the environment quota, the 1.5°C target (see the "1.5°C alignment of KfW's financing activities" section of this chapter) and through the implementation of sector guidelines (see the "Paris-aligned sector guidelines" section of this chapter). As actions, the business sectors' promotional and financing priorities listed in the table above also contribute to the promotion of sustainable transformation. In the Customised Finance & Public Clients and SME Bank & Private Clients business sectors, this includes financing for renewable energy, energy efficiency, sustainable mobility and environmental protection. The commitment volumes for the key contributions of the Customised Finance & Public Clients and SME Bank & Private Clients business sectors in these areas are presented in the table above. KfW Capital's "Green Transition Facility" investment programme promotes start-ups and innovative technology companies that contribute to environmental change through investments in venture capital funds. With regard to sustainable transformation, KfW IPEX-Bank particularly finances projects intended to facilitate doing business digitally and sustainably. In light of the target for the "1.5°C alignment of KfW's financing activities", KfW IPEX-Bank's focus is on investments in renewable energy and in the mobility transition. KfW Development Bank supports sustainable transformation in partner countries, including by providing financing for projects in the fields of renewable energy, environmental protection, sustainable agriculture, education and health. It works closely together with governments, local organisations and companies to develop programmes and projects that have long-term positive impacts on the economic, social and environmental development of partner countries and harmonise these impacts. The commitment volumes for KfW Development Bank's key contributions in these areas are presented in the table above. As part of its business activities, DEG has committed to working together with its customers to achieve a customised approach for a sustainable transformation and climate-resilient business in line with the SDGs. For further information on transformation support for DEG customers, please refer to the "DEG Impact/Climate Commitments" section of this chapter.

Additional information on KfW Group's environmental targets

The strategic objectives, including the environmental targets enshrined in them (SDG contribution of KfW's financing activities, 1.5°C alignment of KfW's financing activities, environment quota), are defined annually with the Board of Supervisory Directors. In this context, the targets are also presented to the stakeholders represented in the Board of Supervisory Directors. As part of the strategic objectives 2029, they apply from financial year 2024 for the following five years. Adjustments to the targets may come about as part of the annual review of the strategic objectives. The monitoring of the targets is part of KfW Group's internal control system. As part of this monitoring, if there are any shortfalls, the causes are analysed and the assumptions on which the strategy is based are reviewed regarding external and internal factors. For more detailed information on the strategic objectives 2029 and information on monitoring the targets, please refer to the "Strategic objectives 2029" section in the "Basic information on KfW Group" chapter.

Overarching policies

KfW Group's overarching policies regarding the topics of climate, energy, pollution and biodiversity are presented in the following chapter. The focus is particularly on the aspects that address the material environmental topics emphasised in the "Environmental information" chapter. This comprises the guidelines on E&S Appraisals and exclusion lists. Further - topic-specific - policies on climate, energy and biodiversity and ESG risks are set out in the "Specific disclosures: Climate and energy" and "Specific disclosures: Biodiversity" sections of this chapter and the "Disclosures on ESG risks" section in the "General information" chapter. Sustainability policies and guidance are included in KfW Group's procedural rules and are subject to an annual review including consultation with the responsible units. The fixed responsibilities for each policy and guidance are defined in the Organisation Manual.

Environmental and Social Appraisal Guidelines

KfW Group's sustainability mission statement includes inter alia the consideration of internationally recognised environmental and social standards within the framework of the E&S Appraisal (see the "Integrating sustainability matters into the business strategy" section in the "General information" chapter). The business sectors' sustainability guidelines follow this mission statement and specify their requirements relating to the E&S Appraisal more precisely in their respective business sector. This applies to the sustainability guidelines of KfW Development Bank and KfW IPEX-Bank and to DEG's environmental and social guidelines and the

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joint sustainability guideline for domestic promotional business of the SME Bank & Private Clients and Customised Finance & Public Clients business sectors. KfW Capital's sustainability policy also governs a process for assessing investments, but does not enshrine a separate E&S Appraisal. Due to the investment focus on exclusively European and German funds and the associated geographical focus of the portfolio companies, risks such as those faced in developing countries and emerging economies play a minor role in KfW Capital's ESG risk assessment.

The sustainability policies are available on the KfW Group websites and are the responsibility of the respective head of department or management board as the highest level. KfW Group's material focal areas of climate change mitigation, pollution, biodiversity and ecosystems are addressed through the standards and requirements applied within the framework of the E&S Appraisal. KfW Development Bank's sustainability guideline additionally takes into account the topic of climate change adaptation. Differences are due to the business sectors' differing promotional and financing priorities. Positive impacts and opportunities are not covered by the guidelines, with the exception of KfW Development Bank's Sustainability Guideline.

The E&S Appraisal is based on the following standards and additional requirements:

Environmental and social appraisal standards and requirements

General scope	Scope
Declaration by KfW Group on respect for human rights in its business operations
IFC Performance Standards (or ESS at KfW Development Bank)^{1)}	SME Bank & Private Clients, Customised Finance & Public Clients, KfW IPEX-Bank, KfW Development Bank, DEG
Environmental, Health, and Safety Guidelines^{1)}
ILO Core Labour Standards^{1)}
Environmental and social standards in the project country in question
Business sector-specific scope	Scope
National environmental and social standards for investments in EU countries	SME Bank & Private Clients, Customised Finance & Public Clients
Requirements of the Federal Ministry for Economic Cooperation and Development, including its Human Rights Strategy	KfW Development Bank
UN Basic Principles and Guidelines on Development-based Evictions and Displacements
Environmental and Social Standards of the European Development Finance Institutions	DEG
Federal Ministry for Economic Cooperation and Development's Human Rights Strategy (for orientation)
Equator Principles	KfW IPEX-Bank

1) For SME Bank & Private Clients and Customised Finance & Public Clients business with location of investment outside the EU and OECD high income countries

The Performance Standards on Environmental and Social Sustainability (IFC, 2012) applied by all business sectors and the World Bank's Environmental and Social Standards (ESS, 2017) applied at KfW Development Bank, address the negative impacts and risks identified as material in the following areas: prevention of pollution including pollutants (IFC Performance Standard 3: Resource Efficiency and Pollution Prevention and ESS3), biodiversity (IFC Performance Standard 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources and ESS6), labour and working conditions in the value chain (IFC Performance Standard 2: Labor and Working Conditions and ESS2), community health, safety and security (IFC Performance Standard 4: Community Health, Safety and Security and ESS4), land acquisition and involuntary resettlement (IFC Performance Standard 5: Land Acquisition and Involuntary Resettlement and ESS5), indigenous peoples (IFC Performance Standard 7: Indigenous Peoples and ESS7) and cultural heritage (IFC Performance Standard 8: Cultural Heritage).

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In the business sectors, the E&S Appraisal processes are adapted to the respective business model in accordance with their sustainability policies. Against this background this section contains a general description for the group as a whole, and relevant differences in the application and/or monitoring of compliance with the requirements in the business sectors are highlighted. The E&S Appraisal pursues the aim of identifying, avoiding, minimising or, if unavoidable, offsetting possible negative impacts and risks of a project for people and the environment. It consists of two key steps: (1) screening and categorisation and (2) in-depth assessment. In the screening and categorisation step, the project is screened for potential environmental and social risks or impacts (screening) and then categorised with regard to the risks involved (categorisation). As part of this process, projects are divided into the risk categories presented in the following table:

Environmental and social appraisal risk categories

Category	Description
A: High risk	Projects that imply potential significant adverse risks and/or impacts for people (social) or the environment that are diverse or irreversible
B+: Significant risk in specific areas	Projects that have potential limited significant environmental or social impacts and/or risks
B: Moderate risk	Projects that have potential adverse impacts or risks that are generally foreseeable, temporary, reversible and limited to the site of the project. These can generally be avoided or reduced with state-of-the-art mitigation measures or standard solutions.
C: Low risk	Projects expected to have no or minimal environmental or social risks

In addition, KfW Development Bank and DEG determine the risk categories for financial intermediaries and banks on the basis of the risk potential of the partner's entire financing portfolio. The categories (FI A, FI B, FI C) and actions are tailored to financing of financial institutions. For private equity funds, DEG also applies categorisation into FI A, FI B+, FI B and FI C. The categorisation is based on the fund's respective target portfolio.

In category A, B+ and B projects, the screening and categorisation is followed by an in-depth assessment. A project's risk categorisation determines the scope, focuses and depth of the assessment. In order to prevent adverse pollution or biodiversity impacts in connection with KfW Group's financing activities or to remedy these if they do occur, actions to avoid or reduce adverse impacts and risks and, where necessary, offsets are identified as a result of the in-depth assessment and imposed on the executing agency and/or borrower with binding effect. KfW Group requests regular reporting on the implementation and requires corrections if measures are insufficiently implemented or action targets are not achieved. Adverse impacts relating to climate change mitigation and to energy are to be prevented or minimised through the application of Paris-aligned sector guidelines (see the "Paris-aligned sector guidelines" section of this chapter) and exclusion lists (see the "Exclusion lists at KfW Group" section of this chapter). In addition, the exclusion lists address the prevention of negative impacts in the area of climate change adaptation.

The assessment is based on Environmental and Social Impact Assessments, any requisite sectoral studies (for example, on resettlement requirements or biodiversity conservation), and documentation of compliance with the relevant national legislation. All projects must meet the environmental and social requirements and standards applicable in the relevant investment country. In the SME Bank & Private Clients and Customised Finance & Public Clients business sectors, national standards are used as the assessment benchmark for investments in EU countries and in OECD high income countries in the event an assessment is necessary. If the investment location is outside this group of countries, in addition to the national standards, international standards are also used as a benchmark. If the E&S Appraisal shows that the environmental and social standards to be applied and the additional requirements are not being met in some areas, avoidance measures, reduction measures or offsets are defined. The scope and nature of the monitoring of the implementation measures are contractually agreed with the partners or financed enterprises. Depending on the risk category, (internal) experts in environmental and social compatibility are also involved. At DEG, such experts are involved in every project irrespective of the risk category. Projects that are likely to have an unacceptable environmental or social impact that cannot be prevented or mitigated by suitable actions are not eligible for funding.

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Sustainability guideline for the domestic promotional business

The currently applicable version of the sustainability guideline for domestic promotional business applies to all new commitments for financing in the SME Bank & Private Clients and Customised Finance & Public Clients business sectors, irrespective of the form of financing. The financing partners were involved in developing the sustainability guideline and the E&S Appraisal process for the on-lending business set out therein. The aim of the guideline is to define a uniform and binding framework for taking account of environmental and social standards in (co-)financed projects and to promote transparency in the E&S Appraisal decision-making processes. In the domestic promotion E&S Appraisal, a distinction is drawn between direct financing by KfW and indirect financing by financing partners. The latter primarily concerns the on-lending business. In both cases (direct business and on-lending business), the screening and categorisation of possible environmental and social impacts and risks is carried out at the level of the uses of funds defined for the individual promotional products or programmes. The product- or programme-induced uses of proceeds are already assessed individually in the product development process (for new development or change/extension of a promotional product), independently of the individual project. Whether KfW subjects the project to a simplified further appraisal, an in-depth further assessment or no further assessment depends on the type of financing (direct business or on-lending business), on the investment country (inside or outside EU countries and OECD high income countries) and on the result of the environmental and risk categorisation.

Actions are usually defined if material shortcomings, i.e. a breach of environmental and social standards by the project, are identified during the in-depth assessment. These then have to be implemented by the borrower or financed enterprise. Environmental and social due diligence by an independent expert may be necessary. In the case of a simplified appraisal, requirements are set in the credit process: before commitment, KfW can request additional information on the project and the status of authorisations, which serves to determine environmental and social compatibility. Depending on the categorisation, environmental and social compatibility aspects are spot-checked at a later point.

The business sectors SME Bank & Private Clients and Customised Finance & Public Clients are responsible for implementing the sustainability guideline and compliance with the graded appraisal procedure. Irrespective of their domicile, the financing partners in the on-lending business are required to use appropriate procedures to take account of potential environmental and social impacts and risks of the projects to be (co-)financed by KfW (including taking account of size, sector and investment country) in line with standard banking practice. This assumption is based on a market analysis and knowledge gained from in-depth discussions with KfW's financing partners. The financing partners are informed of the expectations via tried-and-tested communication channels (in particular financing partner circulars). The procedures can be integrated into existing processes or also explicitly established in the form of an environmental and social management system (ideally in accordance with IFC). KfW conducts annual spot checks of the basic assumption on existing processes for carrying out E&S Appraisals in a later process.

Guideline of KfW IPEX-Bank for environmentally and socially sound financing

The Guideline of KfW IPEX-Bank for environmentally and socially sound financing applies to all KfW IPEX-Bank financing. The guideline fleshes out KfW IPEX-Bank's sustainability mission statement with regard to the assessment of the environmental and social compatibility of its products and advisory and financing services. Its aim is to define a uniform and binding framework for the consideration and incorporation of international environmental and social standards in KfW IPEX-Bank's financing activities. The sustainability guideline is largely based on the Equator Principles, in whose further development stakeholders such as non-governmental organisations are also involved.

All financing is subject to the requirements of KfW IPEX-Bank's Sustainability Guideline. The contracts for KfW IPEX-Bank's financing products for projects for which an environmental and social action plan or mitigation actions are necessary provide for reporting on compliance with safeguards and with the environmental and social action/management plan. The customer engages an independent expert in consultation with KfW IPEX-Bank to carry out the monitoring for category A and category B+ projects (see the "Environmental and Social Appraisal Guidelines" section of this chapter). The expert monitors compliance with the agreed action plans or actions or audits the customer's self-monitoring. In the event of exceptional adverse impacts on the environment or social issues, KfW IPEX-Bank will support the remediation as far as it is able. During the term of category A and category B+ projects, the customer will set up a procedure through which complaints

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by employees and affected members of the public are received and handled in an appropriate way. Complaints and processing results will be documented and part of the contractually agreed internal reporting within the project between the customer and KfW IPEX-Bank.

Sustainability Guideline of KfW Development Bank

The Sustainability Guideline of KfW Development Bank applies to all KfW Development Bank's projects, irrespective of the form of financing. It describes the principles and process for dealing with environmental, social and climate aspects in the context of the preparation and implementation of projects financed by KfW Development Bank. It aims to define a uniform and binding framework for taking account of environmental, social and climate standards in planning, assessment, implementation and monitoring of projects and to create transparency, predictability and accountability in the decision-making processes of the E&S Appraisal and climate mainstreaming.

In addition to requirements on the E&S Appraisal, the guideline stipulates that all financing by KfW Development Bank is subject to climate mainstreaming, the aim of which is to systematically take account of climate change in all projects from the start. Potential associated with climate change is to be unlocked and climate-related risks for the future viability of the projects are to be reduced as far as possible. To this end, each project is analysed for possible aspects relevant to the topics of climate change mitigation and adaptation in order to identify climate-related matters and take account of them in feasibility studies. If climate-related potential or risks are identified, actions to address the potential and risks are agreed for the project with the executing agency. When climate mainstreaming, KfW Development Bank includes KfW Group's sustainability mission statement and applies the specific development-policy concepts and guidelines of the Federal Ministry for Economic Cooperation and Development.

The Sustainability Guideline of KfW Development Bank also includes sustainability matters for awarding contracts for consulting, construction and supplies for the implementation of KfW Development Bank projects. This concerns not only the sustainable design of project elements but also requirements on environmental and resident protection and social compatibility. In accordance with the Sustainability Guideline of KfW Development Bank, the executing agency is required to introduce project-related complaints management in accordance with World Bank's ESS10 and report on it to KfW.

In the case of KfW Development Bank projects, the preparation of the documents relevant for the in-depth E&S Appraisal is supported in the project preparation stage and usually financed by funds from the Study and Expert Fund of the contracting authority, the Federal Ministry for Economic Cooperation and Development. If the executing agency has already prepared documents on environmental and social compatibility itself, these are checked by means of environmental and social due diligence and, where required, an environmental and social action plan is prepared in order to close identified gaps compared to World Bank standards, as already mentioned in this section. Within the framework of donor harmonisation (Paris Declaration), KfW Development Bank can also use comparable standards of other development banks. In the case of KfW Development Bank projects, in addition to reporting by the executing agency or an advisor with appropriate expertise, KfW Development Bank's experts also carry out their own controls of the implementation of the agreed actions in on-site progress controls. KfW Development Bank receives regular reports on the implementation and requires corrections if actions are insufficiently implemented or targets are not achieved.

In order to ensure effective monitoring of any adverse environmental, social and climate impacts and risks, reporting and notification requirements are agreed with the executing agency and/or the recipient of the funds and tracked. In order to monitor the environmental, social and climate impacts and risks of a project, a particular focus is set on controlling the implementation of the agreed mitigation measures and monitoring procedures. If deemed necessary due to the complexity of the circumstances, KfW Development Bank reserves the right to additionally require – in consultation with the executing agency – independent third-party monitoring. If resettlements or actions to restore livelihoods are necessary, these are audited with a separate final audit.

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Financial Report > Combined non-financial report > Environmental information

DEG Guideline for environmental and social sustainability

The DEG Guideline for environmental and social sustainability defines the basis for the environmental and social sustainability of DEG's business activities and describes the principles of DEG's activities, which include safeguarding livelihoods and quality of life in developing countries and emerging economies and aim to advance self-supporting economic systems. Among other things, it stipulates that the environmental and social interests of people affected by the impacts of co-financed projects must always be taken into account when assessing projects. In addition, the guideline enshrines the support of DEG's partner countries in the realisation and further development of environmental protection and international social standards. The guideline applies to the whole of DEG.

In DEG, exposures are categorised in the main assessment. Based on this categorisation of the potential environmental and social risks, the assessment is carried out in accordance with the criteria and processes defined for the relevant category. The harmonised standards of the European Development Finance Institutions ("EDFI"), the content of which is based on the IFC Performance Standards, specify the sequence of the assessment process. The focus and depth of the assessment are determined according to the individual specifics of each project. An environmental and social management plan and/or action plan – as a material result of the assessment in the case of medium and higher risks – defines appropriate and effective actions specific to the project that the financed enterprise is to take to protect people and the environment in order to avoid undesirable impacts, reduce these to an acceptable level or remediate them. This is done taking account of the perspectives of communities affected. Implementation of the actions is closely monitored. In addition, there is mandatory annual reporting by customers and corresponding documentation in DEG.

The DEG processes for the environmental and social due diligence and for the regular environmental and social monitoring are reviewed annually. The first audit of compliance with the guideline is carried out through an internal control system in which the competent head of division analyses individual investments by means of random sampling and monitoring. The control action is also audited externally each year using random sampling.

Exclusion lists at KfW Group

KfW Group's exclusion list for new commitments must be applied on an ongoing basis across all newly committed financing. The exclusion list was developed with the involvement of the business sectors and in consultation with representatives of several departments of the Federal Government. The guideline is published on KfW's website. The heads of the business sectors and the management boards of the subsidiaries are responsible for implementation in KfW Group Compliance with the exclusion list is monitored on a decentralised basis at the level of the business sector-specific credit processes.

By means of the list, KfW Group excludes financing for activities that could lead to unacceptable adverse impacts or risks in relation to certain aspects in the climate, environment and social areas or that are not acceptable for KfW Group for other overriding reasons. With regard to the material topics of climate change mitigation, energy and pollution, these exclusions contribute to reducing or preventing adverse impacts and risks in connection with KfW Group's financing: the production of or trade in radioactive material and unbound asbestos, nuclear power plants (apart from actions that reduce environmental hazards of existing assets) and uranium mines and the prospecting, exploration and production of coal, crude oil (upstream) and natural gas (upstream) and further associated business activities and projects. To minimise adverse biodiversity impacts and associated risks, KfW Group additionally excludes financing for projects that have impacts on the extent and condition of ecosystems and threaten to result in the destruction or significant impairment of areas particularly worth protecting – without appropriate offsetting in accordance with international standards.

Furthermore, the exclusion of financing for production of or trade in products or activities that fall under national or international regulations on cessation or prohibitions or are subject to an international ban is intended to prevent or minimise impacts on the state of species. This includes, for example, exclusions of financing for the production of or trade in ozone-depleting substances pursuant to the Montreal Protocol and protected animals, animal products, plants and plant products pursuant to the Washington Convention on International Trade in Endangered Species. In addition, the exclusion list contains additional requirements that link KfW Group's direct financial involvement to qualitative conditions for selected sectors. This concerns large-scale operations in the agricultural or forestry production of palm oil or lumber and large reservoir and hydropower projects. The former must comply with recognised international certification systems

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Financial Report > Combined non-financial report > Environmental information

(RSPO or FSC) or equivalent regulations to ensure sustainable cultivation conditions or must be in a process developing them in that direction. The exclusion list also addresses direct impact drivers on biodiversity loss by means of exclusions in the areas of climate change and pollution. Further direct impact drivers on biodiversity loss and social consequences of biodiversity-related impacts and impacts and dependencies on ecosystem services are taken into account through the E&S Appraisal (see the "Environmental and Social Appraisal Guidelines" and "Specific disclosures on biodiversity in policies" sections of this chapter).

KfW Capital uses the Exclusion List of KfW Capital to apply restrictions to its operations in economic sectors that are not considered to be compatible with KfW Capital's ethical, social and environmental standards. The exclusion list supplements the Group's exclusions with additional criteria. The Exclusion List of KfW Capital is intended to reduce adverse impacts in connection with climate change; energy; the pollution of air, water and soil; and pollutants. Compliance with the exclusion list by financing partners is audited in a due diligence process and contractually agreed.

The selection of the content of the guideline is carried out by KfW Capital's sustainability management team based on the Exclusion List of the KfW Group and other sector standards, including the IFC Exclusion List issued by the International Finance Corporation and the European Investment Fund Exclusion List and other venture-capital-specific exclusions. The exclusion list is published on KfW Capital's website. KfW Capital's sustainability management, investment management and management board are responsible for implementation.

The following activities that are related to KfW Group's material climate and environmental impacts, risks and opportunities are excluded by KfW Capital beyond the Group's exclusion list:

in the area of climate change and energy, these include investments in any upstream or midstream activities (transportation and storage) in the oil and gas sector and the construction of new oil power plants. In the area of pollution, the exclusions include investments in the production of or trade in considerable quantities of hazardous chemicals and their commercial use. The Exclusion List of KfW Capital also extends KfW Group's exclusions with regard to biodiversity in order to further minimise adverse impacts on biodiversity and the associated risks. Through the exclusions mentioned, the Exclusion List of KfW Capital applies to the areas of climate change and pollution as direct impact drivers on biodiversity loss. In relation to the extent and condition of ecosystems and species, the exclusions additionally comprise exclusion of investments in commercial logging work in semi-natural tropical rainforests and all products for which animal testing is required (for non-medical purposes; special rules apply to life sciences funds), and in the operation of fur farms or the trade in/production of fur products and any activities in connection with shark fins or commercial whaling. The exclusion list does not specifically address social consequences of impacts related to biodiversity and ecosystems.

In accordance with the EDFI environmental and social standards "Principles for Responsible Finance", the DEG Exclusion List or Harmonised EDFI Exclusion List lists projects that DEG generally does not finance. The implementation of the exclusion list is monitored using DEG's internal control system and compliance with the list is mandatory at DEG in connection with the E&S Appraisal. The exclusion list is published on DEG's website. The "Sustainability and Corporate Governance" division's management is responsible for implementation. Adjustments to the policy are decided by the management board. Exclusions concerning the material topics of (avoidance of) pollution and biodiversity correspond to the exclusions of the Group's Exclusion List and the material impacts and risks it addresses.

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Financial Report > Combined non-financial report > Environmental information

Specific disclosures: Climate and energy

KfW Group sees an important role for itself in the transformation of the economy and society with the aim of improving economic, environmental and social living conditions. KfW Group wants to live up to its responsibility in the climate-friendly transformation with the aim of achieving the 1.5°C alignment of its new business. The Paris-aligned sector guidelines for emission-intensive sectors serve as an implementation tool for this target and are presented in this chapter as well as the measures adopted to achieve 1.5°C alignment for new business. In addition, DEG's targets and activities in connection with climate and energy are briefly outlined. Before this, an introductory overview of KfW Group's GHG emissions in 2024 is provided.

Greenhouse gas emissions

KfW Group's GHG emissions are presented below:

GHG emissions¹)

	2024
	t CO₂eq
Scope 1 GHG emissions
Gross Scope 1 GHG emissions	3,917
Percentage of Scope 1 GHG emissions from regulated emission trading schemes (%)	0
Scope 2 GHG emissions
Gross location-based Scope 2 GHG emissions	11,627
Gross market-based Scope 2 GHG emissions	1,996
Significant Scope 3 GHG emissions
Total gross indirect (Scope 3) GHG emissions	144,586,508
Cat. 1: Purchased goods and services	54,833
Cat. 2: Capital goods	7,831
Cat. 6: Business travel	5,860
Cat. 7: Employee commuting	7,833
Cat. 15: Investments	144,510,150
Total GHG emissions
Total GHG emissions (location-based)	144,602,052
Total GHG emissions (market-based)	144,592,421

¹) The GHG emissions were calculated in accordance with the requirements of the ESRS, the GHG Protocol and PCAF for the first time for financial year 2024. At the current time, KfW Group has not set a target for the reduction of Scope 1, Scope 2 or Scope 3 emissions (excluding category 15). In light of this, the presentation in the table deviates from ESRS E1-6, AR 48 and does not include any prior-year figures, comparative figures or information in connection with targets (including milestones and base year).

The GHG emissions were calculated in accordance with the requirements of the ESRS, the GHG Protocol (Corporate Standard, Version 2024) and the Partnership for Carbon Accounting Financials (PCAF Global GHG Accounting & Reporting Standard Part A – Financed Emissions) for the first time for financial year 2024. KfW Group's total emissions (market-based) amounted to 144,592,421 t CO₂eq in financial year 2024. The total emissions comprise Scope 1 and 2 emissions and emissions from significant Scope 3 categories. Further details on GHG emissions are set out in the above table and explained methodically in the following sections: "Total GHG emissions in banking operations" for the operational emissions and "Total GHG emissions in the banking business" for the financed emissions. KfW Group's emissions are presented on a gross basis, i.e. the calculation does not include any removals or any purchased, sold or transferred carbon credits or GHG allowances. Biogenic emissions of CO₂ from the combustion or bio-degradation of biomass are not included in the emissions presented in the table above. In financial year 2024, they amounted to 112 t CO₂ in Scope 1 from the burning of wood pellets. With regard to Scope 2 and 3 emissions, it was neither known nor possible to infer whether biomass was used as an energy source in the reporting year.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

The following section considers total emissions from greenhouse gases in relation to net revenue in order to calculate GHG intensity. Net revenue of EUR 21,906 million pursuant to section 2 no. 5 of Directive 2013/34/EU in connection with section 43 (2) c) of the Directive was used to calculate GHG intensity. Net revenue at KfW Group is included in interest income, commission income and other operating income (as part of net other operating income or loss) of the consolidated income statement (see sections "Consolidated statement of comprehensive income", "net interest income", "net commission income" and "other operating income or loss" in the consolidated financial statements).

GHG intensity per net revenue

	2024
	t CO₂eq/EUR million
Total GHG emissions (location-based) per net revenue	6,601
Total GHG emissions (market-based) per net revenue	6,601

Total GHG emissions in the banking operations

In 2024, the total GHG emissions (market-based) in KfW Group's banking operations amounted to 82,271 t CO₂eq. The GHG emissions reported comprise the emissions of the companies consolidated in the sustainability report and Scope 1 and 2 emissions of the leased properties under the financial control of KfW Group. KfW Group takes account of the emission sources explained below in its GHG accounting.

For KfW Group, Scope 1 (direct GHG emissions) includes emissions from stationary combustion (gas and oil heating systems, emergency power generators, combined heat and power units), mobile combustion (owned and leased vehicles) and fugitive emissions (leakage of refrigerants from refrigerators and air conditioning systems). The data is based on invoice data and meter readings, where available, and extrapolations for rented buildings and offices abroad.

In Scope 2 (indirect GHG emissions through the use of energy), KfW Group takes account of emissions from the purchase of electricity, heat and cooling. The data is based on invoice data and meter readings, where available, and extrapolations for rented buildings and offices abroad. In Germany, only green electricity is purchased, via a bundled contract for electricity from renewable sources. The share of contractual instruments in KfW Group's total electricity consumption amounts to 86.5%. These are exclusively bundled contractual instruments. Contractual instruments are not used for other emission sources.

Scope 3 covers all further significant indirect emissions that do not fall under Scope 1 or Scope 2, including the activities along KfW Group's entire value chain. In 2024, KfW Group screened Scope 3 categories 1-14 using estimates in accordance with the requirements of the GHG Protocol Corporate Value Chain (Scope 3) Accounting and Reporting Standards (Version 2011). In the screening, categories 1 (purchased goods and services), 2 (capital goods), 6 (business travel) and 7 (employee commuting) were identified as significant on the basis of the magnitude of their estimated GHG emissions. Emissions in categories 1 and 2 are estimated using invoice data and extrapolated. The data for the category "business travel" is based on information on travel booking, reports on train travel and invoice data for rental-car and taxi journeys. The commuting category is fully estimated on the basis of data by the Federal Statistical Office of Germany for commuting in Germany.

Financed emissions (Scope 3 category 15) were already identified as material in the materiality assessment. Emissions of this category are reported in the "GHG emissions in the banking business" section of this chapter. All other Scope 3 categories were identified as insignificant for KfW Group on the basis of the conducted screening. Categories 3 (fuel-and energy-related emissions), 4 (upstream transportation and distribution), 5 (waste), 8 (upstream leased assets) and 13 (downstream leased assets) were identified as generally relevant categories, but were not classified as significant for KfW Group due to the small amount of emissions associated with these categories. No emissions occur in categories 9 (downstream transportation),

KfW Financial Report 2024

10 (processing of sold products), 11 (use of sold products) or 12 (end-of-life treatment of sold products), as KfW Group does not offer physical products or physical intermediate products. KfW Group does not act as a franchisor and accordingly, there are also no emissions in category 14 (franchises).

Specific KfW Group consumption data (known as activity data) is used for the calculation of emissions where available. This data is multiplied by emission factors provided by the ecoinvent database (where available) or by public databases of the European Environment Agency (“EEA”), the U. S. Environmental Protection Agency (“USEPA”), the Department for Environment, Food & Rural Affairs (“DEFRA”), the German Environment Agency (“UBA”) or the Intergovernmental Panel on Climate Change (“IPCC”), or comes from information from the respective contractual partner. The GHG emission calculation using market-based methods reflects the specific emission factors of the energy providers used by KfW Group. The location-based method, on the other hand, reflects the average emission factors of energy production at specific locations. Where market-based emission factors were not available, location-based emission factors were used for the calculation in line with the requirements of the GHG Protocol. A distinction is made in the emission calculation between primary and secondary data. Primary data is collected directly, whereas secondary data is derived from analysing and modelling primary data. KfW Group calculates 7.4% of Scope 3 emissions (excluding category 15) using primary data from suppliers or other partners in the value chain.

The GHG inventory includes values based on discretionary judgements, estimates and assumptions that are determined in accordance with the requirements of ESRS E1-6 and the GHG Protocol. The emissions of KfW Group's foreign locations were consolidated into the calculation of greenhouse gas emissions for the first time in 2024. In order to ensure reasonable effort and take account of regional differences in emissions, the Scope 1 and 2 emissions are extrapolated to 100% using data collected from a third of the locations. The foreign locations' Scope 3 emissions are estimated in accordance with the requirements of ESRS E1-6 and the GHG Protocol. Due to the estimations applied, the amount of emissions stated is only an approximation of the actual emissions. Where discretionary judgements and estimates were required, the assumptions made are presented in the explanation of the relevant emission category.

Total GHG emissions in the banking business

Since 2023, KfW Group has developed a group-wide GHG accounting system in order to create transparency regarding the GHG footprint of its promotional and financing activities -- referred to as “financed emissions”. GHG emissions within Scope 3, category 15 (“financed emissions”) in accordance with the GHG Protocol are calculated following PCAF recommendations (PCAF Standard, Part A). The PCAF framework provides standardised formulas for calculating the GHG emissions of various asset classes in the portfolios of financial institutions. PCAF distinguishes between a total of seven asset classes: listed equity and corporate bonds, business loans and unlisted equity, project finance, commercial real estate, mortgages, motor vehicle loans, and sovereign debt.

The relevant population of transactions for calculating KfW Group's financed emissions is based on these aforementioned asset classes and fully covers all transactions defined in accordance with the PCAF Standard. The financed share of counterparties' reported or estimated GHG emissions for corresponding KfW Group transactions is calculated using the PCAF methodology for the respective relevant asset class. The allocation of the GHG emissions is based on the level of KfW Group's financing share of corresponding transactions and covers Scope 1 to 3 of these business-related GHG emissions. The KfW Group portfolio's total GHG emissions are defined as the sum of the financed emissions of all relevant on-balance sheet transactions. In total, 80.1% of KfW Group's total assets is taken into account in the group-wide GHG accounting as of the 31 December 2024 reporting date in accordance with the PCAF asset classes used.

The financed emissions are calculated for all KfW Group's business sectors and broken down in the table below in accordance with the EU classification of business sectors NACE (Rev. 2). The breakdown in terms of the NACE sectors' climate relevance is based on the structure of the templates under CRR part 8 (ESG disclosure). In addition to the disclosure of KfW Group's absolute financed GHG emissions (including a breakdown by Scope 1 to 3), the economic GHG intensity per NACE sector is also presented. The economic GHG intensity in the table below is derived from the amount of GHG emissions (t CO_{2}eq) in relation to the associated gross carrying amount (IFRS; EUR in thousands) per NACE sector or in total.

Financial Report > Combined non-financial report > Environmental information

KfW Group's financed emissions amounted to 144,510,150 t CO₂eq in financial year 2024. The calculation includes the financed GHG emissions of the statistical population described above.

The direct Scope 1 emissions represent a share of 52.84%, the Scope 2 emissions a share of 4.54% and the Scope 3 emissions a share of 42.62%. A comparably high share of financed GHG emissions is attributable, in particular, to investments in the sectors "D – Electricity, gas, steam and air conditioning supply" and "H – Transportation and storage". A share of 57.5% of KfW's total footprint is attributable to these sectors. With a share of 12.4% of the total footprint, sector "C – Manufacturing" is the third largest sector covered in the portfolio. The other highly climate policy relevant NACE sectors account for 15.2%. Less climate policy-relevant sectors accounted for 2.7% of total emissions, while 12.2% were attributable to other NACE sectors (J, M to U). With a total financing volume of EUR 436.8 billion, this results in a total intensity of 0.331 t CO₂eq/EUR thousand.

KfW Group's financed GHG emissions (Scope 3, category 15) by NACE sector (Level 1) as of 31 December 2024

	Scope 1–3	Scope 1	Scope 2	Scope 3	Economic intensity
NACE sector	t CO₂eq	t CO₂eq	t CO₂eq	t CO₂eq	t CO₂eq/EUR in thousands
High climate impact
NACE sectors
A – Agriculture, forestry and fishing	762,653	121,003	21,479	620,172	0.878
B – Mining and quarrying	3,008,600	1,827,232	174,962	1,006,407	1.392
C – Manufacturing	17,936,880	4,187,451	1,009,778	12,739,652	0.677
D – Electricity, gas, steam and air conditioning supply	46,424,747	36,402,603	2,033,031	7,989,112	0.880
E – Water supply; sewerage; waste management (...)	8,446,795	5,718,167	338,705	2,389,923	0.867
F – Construction	3,129,134	115,287	154,242	2,859,605	0.415
G – Wholesale and retail trade; repair of motor vehicles and motorcycles	1,420,620	175,567	96,556	1,148,497	0.101
H – Transportation and storage	36,633,179	17,926,174	735,733	17,971,272	0.811
I – Accommodation and food service activities	136,448	8,175	13,706	114,567	0.041
L – Real estate activities	5,027,579	1,184,425	493,752	3,349,402	0.038
Other (low) climate impact
NACE sectors
K – Financial and insurance activities	3,894,571	1,151,097	397,237	2,346,237	0.231
Other sectors (J, M–U)	17,688,943	7,540,734	1,088,414	9,059,796	0.141
Total	144,510,150	76,357,914	6,557,595	61,594,640	0.331

For the calculation of financed emissions, KfW Group has decided to generally aim for the highest possible data quality of relevant GHG information – expressed in the data quality score ("DQS") – to ensure reliable calculation of financed GHG emissions pursuant to PCAF. Where KfW Group's business partners provide reported GHG emissions, these are used in the calculation of the GHG footprint (DQS 1 and 2). For the remaining financing activities, the primary approach is to use approximations with the aid of corresponding PCAF calculation models. The models are based on physical activity data (DQS 3) and GHG intensities of the business partner's respective sector (DQS 4 and 5).

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Financial Report > Combined non-financial report > Environmental information

Publicly accessible GHG databases such as EXIOBASE and the Joint Impact Model are used for the approximation of financed GHG emissions on the basis of industry sector averages (DQS 4 and 5). Modelling using physical activity data (DQS 3) is primarily used for project and property financing and is based on, for example, datapoints from the Poseidon Principles (ship financing), the AWG Carbon Calculator (aircraft financing) and the IPCC³⁾ (power plant financing).

The average DQS across KfW Group's total relevant financing portfolio is 4.55. Looking at the individual Scope categories of financing activities, the highest GHG data quality with a corresponding average DQS of 4.48 is achieved with regard to Scope 1 GHG emissions. Scope 2 GHG emissions have an average DQS of 4.59, while the majority of Scope 3 GHG emissions were collected on the basis of industry averages and have a corresponding DQS of 4.61. The proportion of financed GHG emissions that were calculated on the basis of primary data from business partners is associated with the corresponding DQS levels 1 and 2 across all business sectors and asset classes and amounts to 14.1%. Scope 1 GHG emissions have the greatest coverage of primary data.

The focus of the further stages of expansion of KfW Group's GHG accounting is on the ongoing refinement of the PCAF methodology and increasing the data quality of relevant GHG information through published customer data.

1.5°C alignment of KfW's financing activities

The aim of the 1.5°C alignment of KfW's financing activities is set out in KfW Group's strategic objectives 2029 as one of three sustainability targets and therefore applies throughout the group. The target is divided into two components: "1.5°C alignment of new financing" and "GHG neutrality of the portfolio". By establishing the GHG accounting system for measuring KfW Group's financed emissions, through which a GHG footprint was calculated for the first time for the reporting date of 31 December 2024, KfW Group set 2024 as the base year for measuring progress towards the target. The first time it will be possible to measure progress will therefore be by the reporting date of 31 December 2025. The target was set as part of KfW Group's "tranSForm" project with the involvement of the business sectors Customised Finance & Public Clients, SME Bank & Private Clients, KfW Development Bank, KfW IPEX-Bank, KfW Capital and DEG. The Paris-aligned sector guidelines that apply throughout the group serve as a key steering instrument to ensure the 1.5°C alignment of new financing.

The implementation of the second component of the target, GHG neutrality of the portfolio, is to be achieved by the middle of the current century. The target allows KfW Group to operationalise the contribution to achieving the 2030 Agenda set out in the sustainability mission statement and monitor the alignment of its financing with the Paris Climate Agreement in this regard. Please see the "Additional information on KfW Group's environmental targets" section of this chapter for information on how the progress towards the target is monitored. KfW Group is currently reviewing a possible revision of the target regarding ESRS requirements for a measurable, outcome-oriented and time-bound GHG emission reduction target.

Paris-aligned sector guidelines

KfW Group's Paris-aligned sector guidelines (sector guidelines) define sector-specific minimum requirements for the climate-alignment of financed technologies for greenhouse gas-intensive economic sectors. They are publicly available on KfW's website and entered into force on 11 June 2021 (last updated on 22 May 2024). The sector guidelines' objective is to support the global transformation process towards GHG neutrality. By means of the sector guidelines, KfW Group commits to the 1.5°C climate target and assumes responsibility for a sustainable transformation of business and society in Germany and globally. The sector guidelines were developed with the involvement of the business sectors Customised Finance & Public Clients, SME Bank & Private Clients, KfW Development Bank, KfW IPEX-Bank, KfW Capital and DEG. KfW Group also engaged in dialogue with representatives of several departments of the Federal Government before publication. Beyond the sector guidelines, KfW Group plans to develop a transition plan for climate change mitigation.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

The sector guidelines focus on greenhouse gas-intensive sectors in which the use of carbon neutral technologies is particularly challenging ("hard to abate"). When selecting the sectors, it was ensured that the sectors constitute significant financing volumes in the group. The sector guidelines are in line with the Paris Climate Agreement because their defined minimum requirements ensure compliance with the decarbonisation pathways mapped out in Paris-aligned climate scenarios. As a result, the sector guidelines illustrate the mix of transformation and transition technologies that can shape the structural change process in line with the Paris Agreement. Transformative technologies that directly contribute to the targeted GHG neutrality are increasingly being promoted. In addition to investments in research and development, this includes, in particular, greenhouse gas-neutral technologies and business models that are already marketable and require suitable financing for further market penetration. This includes, for example, renewable energies and green hydrogen. Transitional technologies that cause GHG emissions but will initially still play an important role with regard to a climate-friendly and successful transition will also continue to be financed. Limiting the associated financing volume in line with the Paris-aligned decarbonisation pathways, avoiding long-term carbon lock-in effects and continuously focusing on the best available technologies is key for Paris alignment. The requirements for technologies differ in the sectors and are more closely defined in the respective sector guidelines. However, greenhouse gas-intensive technologies that are neither compatible with the GHG neutrality targeted in the long term nor required for the transition phase are excluded. To ensure Paris alignment, the sector guidelines also take account of the fact that the climate impact of financed plants, power stations, buildings and other assets does not end with the full repayment of the associated loan, but rather these assets are generally used beyond the term of the loan. KfW Group has therefore selected the sector guidelines' minimum requirements in such a way that the investments covered by them will be in line with the Paris-aligned decarbonisation pathways until the end of their expected technical lifetimes.

The sector guidelines are thus a central tool by KfW Group for addressing its material impacts, risks and opportunities in relation to climate change mitigation and in the area of energy. They reduce KfW Group's negative impact by limiting the financing of investments in greenhouse gas-intensive sectors and technologies with minimum requirements for climate alignment. Capital flows and financing are channelled towards sustainable investments by the use of the sector guidelines and KfW Group's financed emissions are reduced. In addition, the financing of renewable energy and energy efficiency measures promotes the sustainable transformation of the energy sector. This will strengthen KfW Group's positive impact on climate change mitigation and in the area of energy and will make use of the associated opportunities. KfW Group's sector guidelines also mitigate transition risks and reputational risks from financing borrowers criticised for high emissions. The topic of climate change adaptation and KfW Group's associated material impacts, risks and opportunities are not covered by the sector guidelines. This topic is addressed in KfW Development Bank's Sustainability Guideline as part of the climate mainstreaming established in this business sector (see the "Environmental and Social Appraisal Guidelines" section of this chapter).

The sector guidelines, which had been implemented in 2021, were revised in 2022 in view of the 1.5°C target. Science-based minimum requirements were derived from the IEA's "Net Zero by 2050" scenario for the electricity generation, iron and steel production, automotive, aviation and building sectors. A steering system was developed for the shipping sector that, in addition to the previous technology-centred approach based on the IEA's Sustainable Development Scenario, steers the shipping portfolio towards 1.5°C alignment using real emissions data for the financed assets. Information from the Poseidon Principles framework was used for this. Since December 2023, the steering system has been supplemented by sector guidelines for the oil and gas sector, which were also derived from the "Net Zero by 2050" scenario.

Generally, the sector guidelines apply to new financing by KfW Group in the aforementioned sectors with immediate⁴⁾ effect from the date they enter into force. They do not apply to financing projects or promotional programmes that were already in an advanced stage of preparation or had been fully prepared at the

⁴⁾ In certain business sectors, transition deadlines apply for internal and external communication and, if applicable, process adjustments.

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Financial Report > Combined non-financial report > Environmental information

date of publication of the respective sector guidelines. There are also promotional programmes for which none of the sector guidelines are applicable as management-relevant projects are not addressed. For new or extended programmes, KfW uses the sector guidelines to check the Paris alignment of respective programmes. The Federal Republic of Germany can also commission KfW Group to provide financing in the form of programmes or individual mandates, even if these are not compatible with the sector guidelines. Responsibility for implementation of and compliance with the sector guidelines is held at the highest level by the heads of the business sectors and the management boards of the subsidiaries. As the central regulator, the Sustainability Strategy division is involved in monitoring the appropriate implementation of the sector guidelines and has tracked their proper implementation in the business sectors' processes.

For the SME Bank & Private Clients and Customised Finance & Public Clients business sectors' promotional programmes, the alignment of the product- or programme-specific conditions with the sector guidelines is reviewed in a product development process for new or enhanced products and, if necessary, these conditions are adjusted (for example in the programme factsheets). For new products and structural changes to existing products, the product is checked for alignment with the sector guidelines before the new product process is started. Compliance with sector guidelines is integrated into the product factsheets and contract terms as an eligibility criterion. By signing the contract, the borrower confirms compliance. The contractual relationship between KfW Group and on-lending financial companies stipulates that the banks must monitor the use of the funds for the specified purpose by means of suitable customary banking measures. The audit of the appropriate use of the funds must be documented by the financing partner. In the case of loan commitments requiring approval in the business sector Customised Finance & Public Clients, in line with the approach at KfW Development Bank, KfW IPEX-Bank and DEG, it is documented in the loan application whether the financing falls under any sector guidelines and whether these are complied with. Otherwise, no contract can be concluded and the programme cannot be implemented. At KfW Development Bank, KfW IPEX-Bank and DEG, compliance with sector guidelines is integrated into the respective requirements for the loan process. For each financing approach, it is checked and documented in the loan application whether the financing falls under any sector guidelines and whether these are complied with. Otherwise, no contract can be concluded. venture capital funds financed by KfW Capital invest equity in companies and do not finance technologically definable objects. KfW Capital's business is therefore currently not affected by the sector guidelines. When taking up new activities and in a portfolio review, KfW Capital ensures that the sector guidelines are applied if new commitments fall within their scope.

Actions to achieve 1.5°C alignment for new financing

As part of the "Paris alignment" sub-project of the "tranSForm" project, a methodology for accounting GHG emissions was established to regularly capture the group-wide GHG footprint of the financing portfolio. This is intended to systematically demonstrate over the course of time to what extent the Paris-aligned sector guidelines lead to long-term decarbonisation of the financing portfolio. To this end, a group-wide vision was developed for implementation of a GHG accounting system that takes into account the heterogeneity of the financing portfolio. The GHG accounting system will enable the systematic recording and quantification of GHG emissions connected to KfW Group's financing activities. This is intended to create transparency by giving stakeholders, including the public, an insight into the financing activities' GHG footprint.

Further actions to achieve the 1.5°C alignment for new financing include promotional programmes and financing by KfW Group that contribute to the environment quota (see "Environment quota" section of this chapter). KfW Group's ability to undertake promotional and financing activities in the area of climate and energy is fundamentally dependent on sufficient availability of funds through refinancing. KfW's refinancing situation described in the "KfW Group's value chain" section in the "General information" chapter supports KfW Group's operating activities in setting promotional incentives.

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Financial Report > Combined non-financial report > Environmental information

DEG Impact/Climate Commitments

With the adoption of the three Impact/Climate Commitments, DEG's work since 2022 has focused (1) in an even more targeted manner on further increasing the positive development impacts of its customers' projects on society and the environment, (2) reducing greenhouse gas emissions in line with the Paris Climate Agreement's 1.5°C target in the fight against climate change using a science-based pathway and (3) actively supporting its customers in their transformation to strengthen their resilience and achieve even greater development impacts. With the second commitment, DEG particularly contributes to climate change mitigation and to strengthening its customers' climate resilience. It focuses on the joint development of climate-related transformation pathways with DEG clients to reduce GHG emissions. A reorganisation of DEG's portfolio is intended to successively reduce its emissions through more climate-conscious new business (avoidance) and transformation offers for existing clients (reduction). The remaining emissions attributable to DEG are then to be permanently removed from the atmosphere from 2040 through investments in sink projects in order – beyond KfW's group-wide target of 1.5°C alignment – to achieve a neutral position for the portfolio as early as 2040. A corresponding investment strategy on neutral positioning is currently being developed. DEG is currently also developing interim targets for the reduction pathway for 2030 and 2035. The climate strategy is embedded in DEG's business strategy as a strategic framework and has been adopted by DEG's management board.

DEG is aiming to reduce greenhouse gas intensity by two thirds compared with the base year 2021 with its transformation pathway to reduce the greenhouse gas intensity (measured in t CO2eq per EUR million of financing cash value) of its ordinary business activities as a development finance institution, i.e. all exposures financed from its own funds at portfolio level, by an average of 4.2% each year from 2025 compared with the base year 2021. The strategy, including the target, thus relates to DEG's financed emissions (in accordance with PCAF, Part A). It does not take account of emissions arising as a result of the on-lending of external funds to DEG's customers. Further information on the calculation and measurement of financed emissions is provided in the "Greenhouse gas emissions" section of this chapter. The pathway to neutral positioning was chosen in accordance with the Paris Agreement, although DEG is not excluded from the EU Paris-aligned Benchmarks. Target achievement is based on the requirements of the Science Based Target initiative ("SBTi"). These require a substantial reduction of attributable emissions and/or the emission intensity and permanent removal of the remaining emissions. Target achievement is governed by the group-wide Paris-aligned sector guidelines (see "Paris-aligned sector guidelines" section of this chapter). If the sectors relevant to DEG's business are not yet covered by the sector guidelines, the reduction pathway of 4.2%, which is based on the "absolute contraction approach" for mixed and heterogeneous product portfolios in accordance with SBTi (2020), and, as of 2025, the department-specific emission intensity targets and associated carbon budget apply. Both instruments are used in the early assessment of financing as well as the final financing decisions. For the base year 2021, the emissions financed by DEG were recorded in full for the first time using customer data and GHG modelling. The baseline value of the DEG portfolio's emission intensity for base year 2021 is 413 t CO2eq per EUR million. The GHG intensity value relates to the Scope 1 and Scope 2 emissions from the direct financing business that are attributable to DEG and to the attributable Scope 3 category 15 emissions in the indirect financing business with financial institutions. In a test phase until the end of 2024, the necessary systems for GHG accounting and progress measurement were created and increased reduction targets up to the target of 4.2% were introduced gradually. Measurement of performance and progress to achieve these targets will be published in this report from 2025 onwards in accordance with the requirements of the ESRS.

The most important actions in 2024 that are intended to contribute to achieving DEG's climate goals are summarised in the following table. The actions set out in the DEG Impact/Climate Commitments are based on the following hierarchy: 1) avoidance of greenhouse gas emissions, 2) reduction of greenhouse gas emissions and climate change adaptation through the implementation of transformation pathways with customers and 3) neutralisation of unavoidable, remaining greenhouse gas emissions from 2040. They focus on decarbonising DEG's investment business as a decarbonisation lever and will collectively contribute to an expected reduction of GHG intensity in the portfolio by 4.2% annually from 2025.

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List of the most important actions for achieving DEG's climate goals

Action (classification in the hierarchy of actions)	Target group	Implementation period	Time horizon
Climate-friendly customer selection (avoidance)
The customer's climate data is already collected prior to the financing commitment in order to determine the customer's climate impact and its alignment with the Paris targets. DEG is guided by the Multilateral Development Banks' Principles for Assessment of Paris Alignment and the KfW sector guidelines. From 2025, the plan is to also manage the direct business through carbon budgets.	All DEG's financing commitments	2022	Ongoing measure
Management of DEG new business (reduction)
Definition and piloting of department-specific carbon budgets for flexible portfolio allocation and to enable financing of customers with higher emission intensity in order to be able to support them in the transformation and thus reduce their greenhouse gas intensity.	DEG's financing business in the Corporates and Infrastructure customer cluster	Definition in 2024, piloting from 2025	2025
Transformation support for DEG customers (reduction and adaptation)
Support of DEG customers in their transformation towards Paris-aligned reduction pathways, especially also for high emitters, and for climate change adaptation through an extended advisory service in the form of the Climate Advisory and Reduction Initiative (“CARI”) programme. To measure this effect, the Development Effectiveness Rating (“DERa”) was expanded to include the aspect of CO_{2}eq reduction and transformation at the customer supported by DEG; objective: DERa score for the portfolio of 32 points as of 31 December 2024 (see section “Workforce in the value chain and affected communities” in the “Social information” chapter).	All customer groups of DEG's financing and advisory business	2024	Ongoing measure
Neutralisation of DEG's remaining GHG emissions (neutralisation)
Establishment of a diversified portfolio with afforestation and reforestation projects; objective: neutralise remaining GHG emissions financed by DEG through direct investments in sink projects.	All customer groups of DEG's financing business	Ongoing since 2022	2040

DEG made the following progress in realising the Climate Commitments in 2024: in addition to increasing HR capacity for climate management and advisory services, the recording and documentation of DEG portfolio customers' greenhouse gas emissions were digitized and the basis for integration into standard processes was created. In terms of avoiding and reducing the emissions it finances, DEG took a large number of climate-relevant Business Support actions (training on carbon accounting for funds, modelling of GHG inventory at banks, etc.) and piloted specific climate advisory projects with individual customers from Nicaragua and Nigeria. Particular support went to the CARI programme of the subsidiary DEG Impulse, in the amount of EUR 1.5 million for a range of climate advisory projects. DEG also invested in a further carbon sink fund in 2024 and obtained EU guarantees for carbon sinks which will be used for additional investments in carbon sinks that will contribute to DEG's carbon-neutral status from 2040.

Specific disclosures: Pollution

In the materiality assessment, with regard to pollution as a consequence of its promotional and financing activities, KfW Group identified as material both positive (reduction of pollution through the financing of environmental projects) and negative impacts (financing of projects/companies in particularly polluting industries or industries with high pollutant emissions). The measurement of the positive impacts and the prevention or minimisation of negative impacts are part of the cross-topic targets described in this chapter (SDG contribution and environment quota) and policies (sustainability guidelines of the business sectors and exclusion lists), which are listed in the “Overarching environmental targets and actions” section in the “Environmental information” chapter. Existing actions for these targets related to (reducing) pollution are also set out in the general information. For information on pollution in accordance with ESRS E2-1, E2-2 and E2-3, please therefore refer to the specified section of the chapter.

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Specific disclosures: Biodiversity

The topic of biodiversity was a particular focus of KfW Group's strategic orientation in 2024 in the second phase of the "BioDiv Roadmap" (see the "Biodiversity actions" section of this chapter). Targets with regard to KfW Group's promotional and financing activities in the field of biodiversity have so far been set within the framework of the KfW's financing activities' contribution to SDG 14 and SDG 15 (see the "SDG mapping of KfW's financing activities" section of this chapter). There is no specific biodiversity target beyond this in light of the fact that the biodiversity strategy is still under development (see the "Biodiversity actions" section of this chapter). Some actions concerning biodiversity also include promotional and financing activities that contribute to the environment quota. Please therefore see the "Environment quota" section of this chapter for information on these actions. Moreover, KfW Development Bank places a special focus of this financing on the protection and sustainable use of biodiversity. In light of this, KfW Development Bank's biodiversity actions are presented separately below.

Biodiversity actions

KfW Group is developing a biodiversity roadmap until 2026. From its perspective, the ongoing loss of biodiversity in addition to climate change is one of the most urgent challenges of our time. Biodiversity thus represents an increasingly relevant topic for KfW Group as a transformative bank. The "BioDiv-Roadmap", an internal project, was launched in 2023 to address the topic of biodiversity in a structured and targeted way in the group. The second phase of the roadmap ended at the end of 2024. During this phase, analyses were carried out to create the foundations for the next phase, in which a biodiversity strategy is to be developed and then implemented. The most important activities in this phase included a qualitative description of KfW Group's status quo; performance of initial, in some cases still to be validated, portfolio, materiality, regulation and peer analyses; and the identification of possible partnerships. The action areas for the future biodiversity strategy were set on the basis of these analyses. For the third phase, which begins in 2025 and is expected to expire by the end of 2026, the plan includes developing a qualitative biodiversity strategy, expanding projects with positive impacts, reducing negative impacts in the new business and managing biodiversity-related risks that impact the group in line with regulatory requirements. Furthermore, the foundations are to be laid and further developed for the selective collection of biodiversity data from the co-financed projects. The biodiversity roadmap is an overarching action for developing KfW Group's future biodiversity strategy. Where biodiversity offsets, mitigation actions or the inclusion of local and indigenous knowledge are intended to be part of the strategy that is to be developed, they are listed here. These aspects are currently included, where necessary, in the E&S Appraisal (see the "Environmental and Social Appraisal Guidelines" section of this chapter).

KfW Development Bank places a special focus on the topic of biodiversity. The business sector's key biodiversity actions are presented in the following table:

KfW Development Bank's key biodiversity actions in 2024¹)

Action/project	Target group	Promotional business volume
		EUR in billions
Projects with biodiversity as the main or secondary objective and contracts with partner countries with an OECD Development Assistance Committee's biodiversity and tropical forest label for the protection of biodiversity (time horizon: 3–5 years)	Developing countries and emerging economies, governments and state institutions/authorities in partner countries	0.5

¹) The consideration of biodiversity offsets or inclusion of local and indigenous knowledge is project-dependent and, where necessary, takes place within the framework of the E&S Appraisal, for example through the use of IFC Performance Standards or the World Bank's Environmental and Social Standards (see the "Environmental and Social Appraisal Guidelines" section of this chapter).

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Financial Report > Combined non-financial report > Environmental information

Specific disclosures on biodiversity in policies

The IFC Performance Standards (or, in KfW Development Bank, the World Bank's Environmental and Social Standards), which are applied in the E&S Appraisal in certain circumstances and are enshrined in the E&S Appraisal guidelines (see the "Environmental and Social Appraisal Guidelines" section of this chapter) take account of direct influences on the loss of biodiversity and further biodiversity aspects as set out below. IFC Performance Standard 6 (or ESS6) requires that the following aspects are taken into account in connection with the identification of risks and impacts concerning biodiversity and ecosystem services: relevant threats to biodiversity and the ecosystems and ecosystem services, with a focus on the loss of habitats, the destruction and fragmentation of habitat, invasive alien species, exploitation, hydrological changes, nutrient pollution and pollution. These impacts are to be avoided where possible or, where this is not possible, minimised. IFC Performance Standard 6 (or ESS6 and, with regard to ecosystem services, ESS1) takes account of further impacts on the state of species and excludes the implementation of projects that would lead to a (net) reduction in the population of endangered or particularly endangered species and sets out requirements for preventing the introduction of invasive alien species. In addition, the standards set out requirements for preventing or mitigating impacts on the extent and condition of ecosystems, including land degradation, and further requirements regarding preventing or mitigating negative impacts on ecosystem services. The social consequences of financing activities in connection with biodiversity are also included through the use of the IFC Performance Standards in the E&S Appraisal. For example, by using standard 7 "Indigenous Peoples" (or ESS7), KfW Group ensures that the informed and willing consent of local and indigenous peoples is considered in the context of financing activities, and that they are consulted as necessary. KfW Group does not use any additional group-specific policies regarding land use/agriculture, oceans/seas or deforestation beyond the policies specified in this report. There are no requirements in the E&S Appraisal guidelines on climate change as a further direct influence on the loss of biodiversity, with the exception of requirements on climate mainstreaming and on the application of ESS6 in KfW Development Bank's Sustainability Guideline. KfW Group's impacts in the area of climate change as a further influence on biodiversity are steered via the Paris-aligned sector guidelines and exclusion lists (see the "Paris-aligned sector guidelines" and "Exclusion lists at KfW Group" sections of this chapter).

Disclosures on climate and biodiversity risks

For general information on KfW Group's ESG risk management, including the existing targets, actions and policies in this regard, please refer to the "Disclosures on ESG risks" section in the "General information" chapter.

Resilience of KfW Group's strategy and business model regarding biodiversity risks

KfW Group examined whether and to what extent ESG risk drivers impact KfW Group's overall risk profile in the short term in the risk inventory of financial year 2024 (see "Risk management approach of KfW (overview)" in the "Risk report" chapter). With regard to biodiversity and ecosystems, the following drivers were defined and analysed in terms of their influence on the risk types: ocean acidification, resource scarcity as a result of loss of biodiversity, dependence on ecosystem services, land and sea use, pollution (of water bodies and soil), animal welfare, exploitation of species, rising resource costs. KfW Group will be affected by biodiversity risks in credit and equity investment risks in particular if reduced biodiversity increases its business partners' probability of default. To analyse whether this materially impacts one or more types of risk, KfW Group first calculated the business partner's risk with regard to dependencies or influences on biodiversity on the basis of the business partner's sector. For business partners who are classified as at risk, the business partner's ESG risk profile is in the second step – taking account of risk mitigation measures – used to calculate whether there is a high risk with regard to the biodiversity categories under consideration in each case. Stakeholders were not included separately in the analysis. As a result, no biodiversity risk drivers were classified as material for financial year 2024 in any risk type.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

Disclosures in accordance with Article 8 of the EU Taxonomy

Legal requirements in the context of the EU Taxonomy Regulation

Substantial financial resources are required for the transformation to a sustainable economy. Since 2018, a comprehensive reform process has been under way at European level with the primary aim of redirecting capital flows towards environmentally sustainable activities. The "EU Action Plan on Financing Sustainable Growth" published in March 2018 and the subsequent "Strategy for financing the transition to a sustainable economy" in July 2021 define numerous fields of action for the development of the regulatory framework in Europe in the area of sustainable finance, which addresses the financial sector in particular. The development of the EU taxonomy for sustainable economic activities was at the core of the package of reforms. It defines a classification system which, with the help of technical criteria, enables economic activities to be classified as environmentally sustainable ("taxonomy-aligned"). The EU taxonomy is thus intended to create a standardised understanding of environmental sustainability and, thanks to this mechanism, to foster increased transparency regarding the associated capital flows. The reporting obligations relating to the EU taxonomy addressed in this section are based, in particular, on the Taxonomy Regulation (EU) 2020/852 (hereinafter referred to as the "EU Taxonomy Regulation") in conjunction with Delegated Regulation (EU) 2021/2178 supplementing Article 8 of the EU Taxonomy Regulation ("Disclosures Delegated Act"; DDA).

In accordance with Article 9 of the EU Taxonomy Regulation, the EU taxonomy covers economic activities with a potentially positive impact on the following six environmental objectives: climate change mitigation, climate change adaptation, the sustainable use and protection of water and marine resources, the transition to a circular economy, pollution prevention and control, and the protection and restoration of biodiversity and ecosystems.

The technical screening criteria for assessing the environmental sustainability of economic activities are specified in several subsequent EU delegated acts. The EU Commission has also published several Draft Commission Notices to address inconsistencies and room for interpretation within the regulations.[5]

The reporting obligations pursuant to Article 8 of the EU Taxonomy Regulation apply to certain financial and non-financial corporations however differ in nature and scope depending on the type of undertaking. These obligations will enter into force in stages. For financial year 2024, financial corporations report taxonomy eligibility for all six environmental objectives, but only report taxonomy alignment for the environmental objectives of climate change mitigation and climate change adaptation. Starting in financial year 2025, the full reporting obligations are to be complied with all six environmental objectives for the first time. Credit institutions report on the taxonomy eligibility and alignment of their financing, including the main KPI for credit institutions, the green asset ratio ("GAR"), in accordance with DDA Annex VI "Template for the KPIs of credit institutions" and Annex XII "Standard templates for the disclosure referred to in Article 8(6) and (7) (nuclear and fossil gas-related activities)". Credit institutions use the information provided by the financed counterparty as a basis for their analysis. In addition to the quantitative disclosures, the qualitative disclosures listed in Annex XI of the DDA must be published. Banking operations processes are not taken into account for credit institutions in taxonomy reporting.

The mandatory scope of application of the EU taxonomy is defined by the European corporate sustainability reporting requirements. As of the reporting date, these were set out in the Non-Financial Reporting Directive ("NFRD"), which was transposed into national law in Germany with the CSR Directive Implementation Act (CSR-Richtlinie-Umsetzungsgesetz – "CSR-RUG"). The NFRD is to be replaced by Directive (EU) 2022/2464, the Corporate Sustainability Reporting Directive ("CSRD"), which was published in December 2022. The CSRD had not yet been transposed into national law as of the 31 December 2024 reporting date; the provisions of the CSR-RUG therefore continue to apply in Germany.

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Financial Report > Combined non-financial report > Environmental information

Application of the EU taxonomy within KfW Group

Sustainability in its actions is a particular priority and an overarching business objective for KfW Group. It promotes climate and environmental protection across the globe and has made sustainability a key component of its mission statement, its policies, and its business and risk strategy. As part of the group-wide "tranSForm" sustainable finance project, KfW Group is addressing, among other objectives, the internal implementation of the reporting obligations resulting from the EU Taxonomy Regulation.

A potential future reporting obligation notwithstanding, KfW Group is voluntarily publishing group-wide taxonomy KPIs in accordance with Article 8 of the EU Taxonomy Regulation for the first time for financial year 2024. Independently of KfW Group, KfW IPEX-Bank falls within the direct scope of application of Article 8 of the EU Taxonomy Regulation at single entity level. It has already disclosed the EU taxonomy information mandatory for reporting since financial year 2021 and is using the option of consolidated reporting at the level of the parent entity of a group this year for the first time.

KfW Group supports the idea of a standardised classification system for environmentally sustainable economic activities. It shares the fundamental view that increasing transparency about the sustainability impact that financing has can have a positive steering effect. The fundamental requirement is that the resulting KPIs are meaningful and comparable. Applied to KfW Group's business activities, implementation of the regulatory requirements set out in the EU Taxonomy Regulation means that significant parts of KfW Group's financed portfolio are excluded from mandatory taxonomy screening. By way of example, financing provided to sovereign states and supranational institutions, corporate financing provided to small or medium-sized companies that are not themselves subject to mandatory NFRD/CSRD reporting, and financing provided to counterparties based outside the EU are not included in the taxonomy KPIs. At the same time, this sort of financing is a key feature of the business activities of a public promotional bank with international operations. What is more, the scope of the EU taxonomy has so far only included economic activities that are especially relevant with regard to environmental and, in particular, climate-related aspects. Other sectors of the economy that are equally deserving are not included in this sort of sustainability analysis as they are not taxonomy-eligible. Finally, the high ambition level and the associated requirement to furnish evidence that the criteria for taxonomy alignment have been met, coupled with the fact that data is often not yet available, result in very low taxonomy alignment rates. As a result, KfW Group has not, to date, used the taxonomy screening results to manage its business sectors or as a component of individual financing decisions. As far as the group's products are concerned, the promotional criteria for individual promotional programmes and fund investments within KfW Group have thus far been geared to selected criteria from the EU taxonomy, in particular the substantial contribution to an environmental objective.[6] Beyond this, the EU taxonomy has not been a relevant consideration when designing the products offered by KfW Group to date.

Basis for taxonomy reporting within KfW Group

For taxonomy reporting, assets are recognised in gross carrying amounts on the basis of KfW Group's consolidated financial statements prepared in accordance with the International Financial Reporting Standards ("IFRS"). In addition, existing definitions and distinctions from regulatory financial reporting ("FinRep") are applied.[7] This relates in particular to the allocation to counterparty type, which is based on the direct business partner in line with FinRep, and the allocation of assets to the required product groups. Taxonomy reporting is based on the regulatory consolidated group. For KfW Group, the subsidiaries included match the consolidated group under commercial law that is decisive for the preparation of the consolidated financial statements.

The GAR represents the share of taxonomy-aligned exposures in certain components of assets, known as covered assets.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

Covered assets are calculated as total assets before risk provisioning less exposures to central governments, central banks and supranational issuers and the trading portfolio. Exposures to central governments, central banks and supranational issuers include transactions with central and state governments, supranational organisations and balances with central banks. KfW Group does not hold any financial assets for trading purposes. Derivatives that are used for hedging purposes in economic terms but do not fulfil the stringent hedge accounting requirements are reported in the trading book.

Certain exposures of covered assets are not eligible for the taxonomy assessment. These include exposures to counterparties not subject to the NFRD/CSRD, as well as derivatives, short-term interbank loans, cash and cash equivalent assets, and other assets. Derivatives in the taxonomy templates comprise derivatives designated for hedge accounting. Other assets include non-current assets held for sale, property, plant and equipment, intangible assets, income tax assets, value adjustments from macro fair value hedge accounting and assets recognised as other assets. This item also includes subsidiaries reported in FinRep under investments in subsidiaries, joint ventures and associates.

Exposures to NFRD/CSRD counterparties in the counterparty sector comprising credit institutions and other financial corporations (financial undertakings) as well as non-financial corporations are always eligible for the taxonomy assessment. Exposures to households are included in the taxonomy assessment if such loans are collateralised by residential immovable properties, building renovation loans or motor vehicle loans. Exposures to local governments and regional governments are also to be included in the taxonomy assessment as a matter of principle.

The verification of the NFRD/CSRD disclosure obligation of business partners is operationalised in accordance with Articles 19a and 29a of Directive 2013/34/EU. For the purposes of determining the NFRD/CSRD disclosure obligation, the direct (legal) principal business partner with which the business relationship is maintained is considered in each case. Business partners in the counterparty sector comprising credit institutions, other financial and non-financial corporations that have their registered office in the EU, employ more than 500 people on average and are classified as large undertakings in terms of their net turnover and/or balance sheet total in accordance with Directive 2013/34/EU are identified. These business partners are classified as being subject to the NFRD/CSRD if they are categorised as public interest undertakings. Business partners in these counterparty sectors are also classified as being subject to the NFRD/CSRD if they have published a mandatory disclosure of taxonomy KPIs for financial year 2023. The published taxonomy KPIs are used to determine the taxonomy-eligible and taxonomy-aligned share, per environmental objective, of transactions with no known use of proceeds.

Transactions with business partners in the counterparty sector comprising credit institutions, other financial and non-financial corporations that do not meet the criteria listed for the NFRD/CSRD disclosure obligation are treated as transactions with non-NFRD/CSRD counterparties and not included in the taxonomy assessment.

For financial year 2024, the only transactions included in the taxonomy assessment for KfW are transactions executed with a business partner from one of the counterparty sectors comprising credit institutions, other financial or non-financial corporations that is subject to the NFRD/CSRD. Accordingly, for products such as investment assets (fund assets), receivables from special purpose vehicles or securitisations, the NFRD/CSRD disclosure obligation is checked first based on the direct business partner involved (legal business partner). Exposures associated with environmentally sustainable bonds are included in the taxonomy assessment without the NFRD/CSRD disclosure obligation having to be checked.

As a government-owned promotional bank, one of the ways in which KfW fulfils its primary, statutory objective, namely the promotional business, is in the form of what is known as on-lending business. The on-lending business means that KfW grants promotional loans to end borrowers via financing partners (credit institutions or other financial corporations). The on-lending business is always to be included in the taxonomy assessment. Due to the lack of data available, the on-lending business is included in KfW Group's taxonomy reporting in financial year 2024 as taxonomy-non-eligible/taxonomy-non-aligned.

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Transactions with local authorities and regional governments are to be included in the taxonomy assessment subject to specific conditions. As no reporting obligations apply for financial year 2024, meaning that there is a lack of data available for these business partners, as was confirmed by spot checks carried out by KfW, no taxonomy assessment is carried out for transactions with local authorities and regional governments. For financial year 2024, all transactions executed with local authorities and regional governments are shown in the reporting tables as taxonomy-non-eligible/taxonomy-non-aligned under local governments financing.

If there is a directly attributable economic activity, i.e. a known use of proceeds, for exposures in the counterparty sector comprising non-financial corporations, a taxonomy assessment is carried out (see Implementation of the taxonomy assessment process within KfW Group). Exposures classified as taxonomy-eligible or taxonomy-aligned with a directly attributable economic activity are included in both the turnover KPI and the CapEx KPI$^{8)}$ for KfW Group. If there are several attributable economic activities for an exposure, this exposure is classified as taxonomy-non-eligible or taxonomy-non-aligned. To simplify matters, transactions that do not add significantly to the informational value of KfW Group's taxonomy reporting are not included in the taxonomy assessment.

Exposures to business partners subject to the NFRD/CSRD in the counterparty sector comprising non-financial corporations without a known use of proceeds (general corporate financing) and exposures to financial undertakings (with the exception of the on-lending business) are considered based on the turnover and CapEx KPIs for each environmental objective as reported in the taxonomy KPIs published by the business partner for financial year 2023.

As KfW Group is publishing taxonomy reporting for the very first time in financial year 2024, no comparative figures for the previous year are provided.

Implementation of the taxonomy assessment process within KfW Group

The taxonomy criteria are checked on a case-by-case basis for every transaction based on the taxonomy reporting principles explained in the previous chapter.

The first step involves determining, for each individual transaction, whether the transaction is eligible for the taxonomy assessment. Eligible transactions are then grouped into exposures for which a definite use of proceeds can be determined and those for which no clear use of proceeds can be defined. The regulatory requirements provide for a different methodological approach to the two groups of transactions.

For exposures with a clear known purpose, the taxonomy eligibility review involves analysing whether the assets financed are related to an economic activity that meets the criteria set out in the Taxonomy Regulation. If so, the financing is assessed as taxonomy-eligible. These types of exposures are then checked for taxonomy alignment. All of the three following requirements have to be met for financing to quality as taxonomy-aligned: (1) a significant positive contribution to one of the six environmental objectives, (2) avoidance of significant harm to the environmental objectives and (3) compliance with minimum social safeguards by the direct business partner. While an exposure with a known use of proceeds can therefore only be analysed entirely regarding its taxonomy eligibility and alignment, financing for which there is no definite use of proceeds is weighted using the taxonomy KPIs published by the business partner concerned and is then reported as taxonomy-eligible and taxonomy-aligned on a pro rata basis. General across-the-board assessments yielding a result of zero for the transactions analysed are excluded.

The taxonomy assessment is performed based on regulations that are standardised across the group. This also includes KfW IPEX-Bank, which was already included in the mandatory scope of application of the taxonomy before other business sectors of KfW Group. At KfW IPEX-Bank, the taxonomy assessment has already been incorporated into the credit process within the banking business. For existing business, the validity of the information that has been collected as a mandatory requirement since financial year 2021 is checked annually and, if necessary, the taxonomy assessment updated on the basis of the information

$^{8)}$ In accordance with the Taxonomy Regulation (EU), non-financial undertakings report their KPIs based on turnover and capital expenditure ("CapEx").

KfW Financial Report 2024

Financial Report > Combined non-financial report > Environmental information

provided or published by the business partner. All other affected business sectors of KfW Group are conducting an initial review of the existing business that is eligible for the taxonomy assessment for financial year 2024 based on the information provided or published by their business partners. The implementation project includes the intensive involvement of all business sectors using appropriate dialogue formats, as well as extensive training sessions and information events that are aimed, among other things, at supporting both the initial review and process implementation.

For financial year 2024, the transactions executed by the business sectors that have been assessed, quality-assured and approved on the basis of FinRep data will be aggregated centrally within Finance and reported on a consolidated basis in the reporting tables to be used in accordance with the EU Taxonomy Regulation. As part of the process of integration into the sustainability report, the disclosures in accordance with Article 8 of the EU Taxonomy Regulation are included in the approval processes for the sustainability report. The financial year 2025 will see the final integration into the standard operating processes, as well as the ongoing expansion of automated reporting. This process will also involve establishing and expanding suitable data exchange processes with relevant customers of KfW Group.

Disclosures by KfW Group on the EU taxonomy as of 31 December 2024

As of the reporting date of 31 December 2024, KfW Group is reporting for the first time on the proportion of its taxonomy-eligible and taxonomy-aligned economic activities for the environmental objectives of climate change mitigation and climate change adaptation. For the other environmental objectives, reporting is only mandatory on the taxonomy-eligible economic activities, to be disclosed in detail in the taxonomy templates (see separate chapter). The two tables below provide a summarised overview of KfW Group's key indicators as of 31 December 2024.

Key indicators as of 31 December 2024

	31 Dec. 2024
Covered assets (in EUR million)	460,085
Exposures not included in calculation of the numerator (as % of covered assets)	44.0
of which: share of counterparties not subject to the NFRD/CSRD (as % of covered assets)	44.0

Overview of taxonomy eligibility and alignment as of 31 December 2024

	Total		Taxonomy-eligible		Taxonomy-aligned (GAR)
	Turnover	CapEx	Turnover	CapEx	Turnover	CapEx
Covered assets	%	%	%	%	%	%
Eligible for taxonomy assessment	56.0	56.0	2.3	2.3	0.2	0.2

The business activities of KfW Group's individual business sectors are represented differently in the taxonomy reporting at group level due to features specific to that business. An overview of the business sectors and their products is provided in the "Strategy, business model and value chain" section in the "General information" chapter.

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In the two business sectors SME Bank & Private Clients and Customised Finance & Public Clients, a significant portion of financing as part of promotional programmes is provided to end borrowers via financing partners in the context of the on-lending business, which contributes a share of 51% to KfW Group's covered assets. The taxonomy eligibility/alignment of this on-lending business cannot be assessed in financial year 2024 as there is not sufficient data available. A possible future approach to enable a taxonomy assessment of the on-lending business and the development of an appropriate process solution is being coordinated with the German banking industry. Municipal financing to local authorities is another area that cannot be included in the taxonomy assessment due to the lack of data available in financial year 2024. As a result, most of the taxonomy reporting for the business sectors SME Bank & Private Clients and Customised Finance & Public Clients currently relates to the assessment of refinancing of financial undertakings outside the on-lending business and the assessment of individual promotional loans for non-financial undertakings.

The business sector Financial markets is responsible, in particular, for refinancing activities, liquidity management and operational market price risk management for KfW Group. The reporting for financial year 2024 essentially includes a taxonomy assessment of the bonds held in the liquidity portfolio for liquidity management purposes and the money market transactions that were executed.

The business sector Export and project finance is managed by KfW IPEX-Bank and comprises the bank's own market business and the fiduciary business conducted by KfW IPEX-Bank in its own name and for the account of KfW. Due to its international focus, extensive components of the portfolio fall outside the scope of mandatory reporting defined by the EU taxonomy, as KfW IPEX-Bank has a significant proportion of business with counterparties that are not subject to the NFRD/CSRD due to the nature of its financing mandate. In conventional export financing, for example, a loan is concluded with a foreign buyer outside the EU in order to finance a German or European delivery. As a result, the exposure is excluded from the taxonomy assessment. Another significant share of KfW IPEX-Bank's business is attributable to special financing transactions with single-purpose entities as direct counterparties. These are generally not subject to the NFRD/CSRD themselves due to size criteria – even if they are based in the EU. As a result, in the reporting year, these transactions are also not eligible for the taxonomy assessment – even if their financing purpose is directly related to a taxonomy-eligible economic activity within the EU.

The business sectors KfW Development Bank and DEG use their funds outside the EU. Following a detailed review in accordance with the requirements set out in the EU Taxonomy Regulation, this means that the corresponding financing arrangements are not eligible for the taxonomy assessment because the counterparties are not subject to the NFRD/CSRD.

KfW Capital invests in German and European venture capital and venture debt funds. Since the funds as direct legal counterparties are not subject to the NFRD/CSRD, KfW Capital's fund investments are not eligible for the taxonomy assessment in the financial year under review.

KfW Group has exposures to households in the form of education financing and employee loans, that are not to be classified as real estate or vehicle financing according to the EU taxonomy. Besides that, there is no significant retail business in any business sector.

Due to the regulatory requirements and the special nature of KfW Group's business activities, a significant proportion of KfW Group's overall portfolio (44%) is not in scope of the taxonomy assessment. A significant proportion of the remaining business that is in scope of the taxonomy assessment cannot be assessed for taxonomy eligibility due to a lack of data available. Based on the overall conditions, only 2.3% (turnover KPI and CapEx KPI) of the business is taxonomy-eligible. These 2.3% mainly comprise economic activities for environmental objective 1 "climate change mitigation" and environmental objective 2 "climate change adaptation" (turnover KPI and CapEx KPI). As of 31 December 2024, KfW Group reported a GAR of 0.2% (turnover KPI and CapEx KPI) on the basis of its covered assets.

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Financial Report > Combined non-financial report > Environmental information

The Complementary Climate Delegated Act (EU) 2022/1214 added six nuclear and fossil gas-related activities to the list of economic activities in the catalogue of requirements. The sector guidelines and the exclusion list restrict the granting of such financing within KfW Group to a considerable degree. The taxonomy-eligible and taxonomy-aligned exposures nevertheless include exposures where the use of proceeds is connected with nuclear and gas activities defined in the Complementary Climate Delegated Act. As far as financial year 2024 is concerned, however, these only include financing for which there is no known use of proceeds. This business is included based on the general KPIs published by the counterparty, including the nuclear and gas activities reported there.

KfW Group has been using the environment quota to measure climate-related and environmental financing since 2012 (see the "Environment quota" section in the "Environmental information" chapter). In 2024, 44% of KfW's financing made a positive contribution to the environment quota. This means that the achievement of the environment quota target differs considerably from the GAR as the main performance indicator used in the EU taxonomy. As of now, the GAR is not part of the KPIs relevant for steering or managing the KfW Group. This discrepancy is due to significant differences in the data collection and calculation methodology, the result being that the two indicators cannot be compared.⁹)

Additional information on the tables in the appendix

Templates for credit institution KPIs

The taxonomy templates for the taxonomy KPIs of credit institutions of Annex VI DDA to be reported pursuant to Article 4 DDA are published in the "Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)" chapter.

The figures in the taxonomy templates are rounded to millions of euros; fractions are reported to one decimal place. Templates 1 to 5 are published separately for the turnover and CapEx KPIs.

The breakdown of the sectors in taxonomy template 2 is based on the main activity of the direct legal business partner.

Templates for nuclear and fossil gas-related activities

The templates for nuclear and fossil gas-related activities of Annex XII DDA to be reported pursuant to Article 8 (8) DDA are published in the "Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)" chapter.

The figures in the templates for nuclear and fossil gas-related activities are rounded to EUR millions; fractions are reported to one decimal place. The information on the economic activities in nuclear energy and fossil gas are provided only for business partners subject to NFRD/CSRD requirements.

For the calculation of the proportions in templates 2 to 5, the covered assets correspond to the exposures in the denominator of the GAR (applies to templates 2, 4 and 5), and the taxonomy-aligned exposures correspond to the exposures in the numerator of the GAR (applies to template 3).

⁹) While the environment quota is calculated based on the annual new commitment volume, it is the group's existing business that is taken as a basis for calculating the GAR. All new commitments in KfW Group's own business can contribute to the environment quota. In the case of GAR, large parts of the lending business are excluded from the numerator as explained above. Furthermore, both the ambition level and the documentation and verification requirements that apply when calculating the GAR are so ambitious that only a handful of transactions meet the requirements for inclusion.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

Social information

The fulfilment of KfW's "sustainable promotion" purpose is operationalised in the strategic objectives 2029, as described in the "Strategic objectives 2029" section in the "Basic information on KfW Group" chapter of the financial report, including in the context of secondary objectives. One of these secondary objectives relates to "employee potential and customer centricity". It stresses the importance of KfW Group's workforce for a top-performing group and focuses on customers as a success factor for sustainable business. This is underpinned by corresponding objectives related to employer attractiveness, customer satisfaction, brand awareness, brand profiling and diversity and is a component of the group's strategy. Strategic importance is also reflected in the impacts and opportunities that have been identified as material for this report, the influence of which is explained in detail in this chapter.

This chapter is divided into four sections. The first section, "Social matters at KfW Group", sets out the basis for KfW Group's social responsibility. The emphasis is on the foundation and, as a result, the supporting guidelines that make up the group's social construct and influence its social activities. The human rights policy described in the section forms the basis that ensures respect for human rights throughout the group and is closely linked to the company's Code of Conduct. This Code defines the rules of conduct and ethical standards that KfW Group and its employees must adhere to, and also sets standards for external partners. The second section addresses social matters in banking operations. The topics of diversity, remuneration, working conditions and worker participation are described in relation to the group's own workforce. This encompasses key aspects for KfW Group such as employee satisfaction, non-discriminatory pay, work-life balance, gender equality and inclusion. All further developments related to these aspects are bundled in the group-wide "Employer positioning" strategic project. All measures in this project are therefore described in detail in the following chapter. KfW Group not only ensures compliance with statutory requirements, but also makes sure that employees are treated fairly, that their rights are safeguarded and that the group is perceived as an attractive employer. Social matters in the banking business, which are addressed in the third section, describe the impacts and opportunities that KfW Group's business has on and for value chain workers, affected communities and customers. This section also provides information on a KfW Group-specific impact on corporate customers. The fourth section explains complaints management and the channels that can be used to raise concerns. The group ensures that complaints raised by its own workforce, as well as those raised by customers, by those affected by financings and by other stakeholders are taken seriously and dealt with appropriately. Aside from ensuring compliance with statutory requirements, this also serves to create an open and transparent corporate culture.

Social matters at KfW Group

KfW Group commits to the following agreements and declarations in its human rights policy ("Policy statement of KfW and its subsidiaries on human rights and on its human rights strategy") and the Code of Conduct:

the United Nations Universal Declaration of Human Rights ("UN", 1948);
the European Convention on Human Rights (1950);
the International Covenant on Civil and Political Rights ("Civil Covenant") and the International Covenant on Economic, Social and Cultural Rights ("Social Covenant", 1966);
the Convention on the Rights of Persons with Disabilities (UN Convention on the Rights of Persons with Disabilities, 2006);
the UN Guiding Principles on Business and Human Rights (2023) and
the other core human rights instruments drawn up within the UN;
the Core Labour Standards of the International Labour Organization ("ILO").

The group also takes into account the Organisation for Economic Co-operation and Development ("OECD") Guidelines for Multinational Enterprises, the IFC Performance Standards and the World Bank's Equator Principles. The human rights principles and policies of the European Development Finance Institutions and the dimensions of the "Diversity Charter" are also observed.

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The aim of KfW Group's human rights policy is to ensure that civil, political, economic, social and cultural human rights are respected, realised and promoted. In this context, the human rights policy incorporates existing rules, policies and processes and maps out the group's human rights strategy. It applies throughout the group and is designed to emphasise the central importance of human rights to partners, customers, suppliers, other stakeholders and the general public. The declaration meets the requirements of Section 6 (2) LkSG for the policy statement to be issued on the human rights strategy with regard to the group's employees and suppliers. The policy is published on KfW's website. The business sectors are responsible for ensuring compliance with the human rights policy within their business processes. Overall responsibility lies with the Executive Board. The group maintains regular and open dialogue with stakeholders, potentially affected parties and experts regarding aspects related to human rights, with the aim of refining processes in place to promote human rights. Stakeholder dialogue is described in the "Interests and views of stakeholders" section in the "General information" chapter.

With regard to the LkSG, associated risk management processes have been implemented to identify and assess potentially highly relevant human rights and environmental risks. A risk analysis of the bank's own operations is carried out every year, and on an ad hoc basis, to identify these risks. The risk analysis is updated whenever the company expects the risk situation in the supply chain to change or expand significantly, due, for instance, to the introduction of new products, projects or a new business sector, or because knowledge has come to light through the established complaints procedure. Based on the identified and prioritised risks, the relevant departments and subsidiaries are required to introduce or review appropriate preventive and remedial actions and make any necessary adjustments. Specifically, a number of risks such as child labour, forced labour including human trafficking and the violation of land rights can be classified as less relevant for the group's banking operations, as most of its employees work in Germany.

KfW Group sees itself as an employer that is committed to the implementation of human and labour rights, including the prohibition of child labour, forced labour and human trafficking, and that guarantees freedom of association, the right to collective bargaining, non-discriminatory pay, the ban on discrimination in respect of employment and occupation (regardless of gender, origin, ethnicity, religion, political beliefs, disability, age or sexual identity) and the right of individuals to recreation, health and safety. Risk-based control measures have been implemented at KfW to monitor requirements related to human rights. Action is taken immediately if violations of human and labour rights become known.

Incorporating the consideration of human rights and environmental protection into its business activities is a top priority for the group. Consideration of human rights and the human rights policy is ensured via the group-wide exclusion list and the applicable sustainability guidelines (see the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter).

KfW Group makes the financial and human resources available to take the actions necessary to manage material impacts on social matters. The allocated resources allow the necessary steps to be taken.

KfW Group's Code of Conduct is a group-wide set of rules that applies to the Executive Board, management boards, top management, and all employees in Germany and abroad, and also serves as a guide for external service providers and partner institutions. It is available to the public on KfW's website. The Code of Conduct sets out principles and recommendations for a value-based approach to risk culture, diversity, inclusion and a non-discriminatory working environment, leadership culture, skills development and data protection. Through implementation of the Code of Conduct, the group is committed to the principles laid down by the OECD and the Financial Action Task Force for dealing with non-cooperative, non-transparent or deficient countries and territories. The Code of Conduct is subject to an annual review process coordinated by the Compliance department. If necessary, ad hoc adjustments can also be made during the year. The departments of KfW and its subsidiaries are involved in preparing and updating the document. Each and every individual is responsible for complying with the principles set out in the Code of Conduct.

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Social matters in banking operations

Social matters in banking operations relate to the group's own workforce, which comprises both KfW Group employees and non-employees, and include issues related to equal treatment/non-discrimination and corporate culture alongside general working conditions. Definitions of the group's workforce and the material impacts for these groups are described in detail in the "Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy" section in the "General information" chapter.

The materiality assessment revealed material positive impacts for KfW Group's workforce. In order to demonstrate the positive impacts arising from working conditions in banking operations, the secondary objective "Employee potential/customer centricity" has been firmly established in the strategic objectives 2029. Key components include the "Employer positioning" project to boost employer attractiveness, customer satisfaction, brand awareness and brand profiling, and diversity.

The "Employer positioning" project creates a strategic framework for many KfW Group measures related to topics such as diversity, leadership culture, development, remuneration and working conditions in order to enhance the group's strategic vision in terms of employer attractiveness. The project was launched in 2023 with the aim of retaining, recruiting and developing employees and will run until 2030. The measures identified as part of this project will be implemented on an ongoing basis and the scope of application extends to all KfW Group employees in Germany. The strategic positioning was developed along the following seven dimensions of employer attractiveness, which, according to studies on employer positioning factors and a survey of managers and employees, talents and committees, influence employee retention and recruitment: company with purpose (includes business models as well as socially and environmentally responsible, sustainable business with a focus on diversity and inclusion in accordance with ESG principles), leadership, collaboration, flexibility (particularly with regard to working hours and workplace, see the "Working conditions" section of this chapter), conditions (especially remuneration, see "Remuneration" section of this chapter), further development and infrastructure (e.g. personnel-related processes).

Actions were then developed, and resources allocated as part of the group business sector planning process in order to implement the strategic positioning. Employees and workers' representative bodies in Germany are closely involved in the project, in particular through an employee survey conducted in 2023 as well as workshops with managers, employees and committees. Employees are informed about developments within the project via a quarterly newsletter and every six months via information events for the company's own workforce. Key actions are described in the following chapters.

Diversity and inclusion

Policies related to diversity and inclusion within the group's own workforce

KfW Group strives to provide equal and fair opportunities and communication channels to all individuals irrespective of any linguistic, cultural or other differences. The topic of diversity and inclusion is covered throughout KfW Group by the human rights policy and the Code of Conduct, both of which are explained in more detail in the "Social matters at KfW Group" section of this chapter. KfW, KfW IPEX-Bank and KfW Capital have also signed the Diversity Charter. The aim of the "Employer positioning" project is to achieve an above-average market positioning for the "Company with purpose" dimension, including the areas of diversity and inclusion. Corresponding ambition levels and actions have been defined, for example, in the Equal Opportunities Plans and the Inclusion Agreement. The topic is also reflected in the group's remuneration strategies, which are described in the "Remuneration" section of this chapter.

Showing employees that they are appreciated is a key focus of the group's sustainability mission statement, and qualified and motivated employees are emphasised as a key success factor. A brief description of the sustainability mission statement is provided in the "Integrating sustainability matters into the business strategy" section in the "General information" chapter.

As KfW and its subsidiaries have different legal forms, they operate on different legal bases where equal opportunities are concerned. This is reflected in a company-specific range of policies, actions and targets. Nevertheless, KfW Group's commitment to gender equality – also with regard to remuneration – is part of the strategic objectives 2029 and is enshrined in the KfW and DEG Equal Opportunities Plans in accordance with Part 3, Sections 11 to 14 of the German Federal Equality Act (Bundesgleichstellungsgesetz – BGleiG).

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KfW prepared the sixth Equal Opportunities Plan; it came into effect on 1 January 2024 and applies to all KfW employees in Germany for a period of four years. After two years, the implementation status will be evaluated and, if necessary, adjustments made to validate target achievement level. The objectives set out in the Equal Opportunities Plan are explained in this section.

Responsibility for implementing KfW's Equal Opportunities Plan lies with managers, supported by the Human Resources ("HR") department. Employees are encouraged to participate in the implementation process and to exploit the opportunities offered by the Equal Opportunities Plan. The Equal Opportunities Plan and the results of the evaluation process are published on the intranet. Targets, sub-targets and key actions are also published on KfW's website.

DEG has adopted its own Equal Opportunities Plan that runs from 1 January 2023 to 31 December 2027 and applies to all employees working in Germany. This plan pursues the following objectives in the areas of gender empowerment, work-life blend, gender pay and gender balance:

Promoting potential candidates through personnel development with a view to equal rights for women and men
Creating a framework by ensuring balance
Non-discriminatory pay by identifying and eliminating structural disadvantages
Achievement of targets through gender parity in management and senior specialist positions

The Equal Opportunities Plan was drawn up by DEG's HR department and coordinated with the Management Board and the Works Council. Reports are presented to the Management Board and the Supervisory Board annually and (interim) results published internally. The Management Board has overall responsibility for implementing the plan.

Actions related to diversity and inclusion within the group's own workforce

In order to implement the policies and achieve the targets outlined in the following section, various actions are being taken to address the topics of diversity and inclusion. KfW Group is implementing the actions described below to create an inclusive working environment that ensures equal opportunities and non-discrimination and to promote structurally disadvantaged groups in management positions. Key actions taken by KfW and DEG are set out in their individual Equal Opportunities Plans. As KfW IPEX-Bank and KfW Capital do not have any legal basis for an equal opportunities plan, a company-specific catalogue of actions has not been drawn up. The group has an overarching corporate wording policy for gender-appropriate language in communication and documents (internal and external, e.g. target group-specific job advertisements), which was adopted with due account for comprehensibility, accessibility and readability.

As part of the employer attractiveness dimension "Company with purpose", the newly developed Equal Opportunities Plan was defined at KfW with regard to making the objectives part of the corporate culture and ensuring equal opportunities, with the following actions, which are to be implemented by 31 December 2027.

Career advancement for women is to be promoted by (further) developing existing communication formats in this area with the involvement of relevant stakeholders. These include panel discussions with experts, webinars, articles and brochures. In order to reduce implicit bias (unintentional stereotyping of, or prejudice against, people of a particular social group), a voluntary basic seminar was set up for all employees. The plan is to incorporate the topic into the full range of further seminars and trainings.

Equal promotion and development opportunities for women are also to be ensured by encouraging managers to highlight explicit opportunities and offerings to female employees, such as training and coaching to assess their skills or to help them develop in specialist roles. One focus is on promoting career advancement for women with severe disabilities, with greater attention being paid to their participation in talent programmes, for instance. Established actions include ensuring a remuneration policy that meets the relevant requirements and is structurally appropriate, as explained in further detail in the "Remuneration" section of this chapter, analysing the career progression of women and men who have taken advantage of programmes to foster the reconciliation of work and family life, setting target salaries for internal transfers and promotions, and actions in the context of a "second-life career" for parents who have been taking advantage of work-life balance offers for a prolonged period.

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In order to increase the proportion of women at levels in the hierarchy not covered by a collective bargaining agreement, targeted exchange programmes and support for women are to be implemented. When filling vacancies, women with the appropriate qualifications are to be given preference for non-tariff roles in order to strive for parity and strengthen the basis for management levels. For the purpose of increasing the proportion of women in STEM roles ("STEM": science, technology, engineering and mathematics) women are to be approached through role models, exchange programmes, networking opportunities, communication measures and transparency regarding new roles. In order to promote part-time leadership, the necessary conditions, such as the establishment of job shares, are to be promoted. The overall conditions for part-time work and leadership are being reviewed and to identify any necessary improvements. Other actions include continuing the talent pools for employees involving at least equal participation, promoting the development of, and supporting, high-potential female employees through mentoring, shadowing and group coaching, addressing potential female candidates for vacancies in senior positions, ensuring gender balance as part of the application process wherever possible, having at least one female manager involved in relevant processes, and defining divisional reference values for senior specialist positions following the reorganisation of non-tariff roles as a whole.

An inclusion agreement was concluded for KfW in 2015 between KfW, the general representative for disabled employees and the General Staff Council to promote the topic of inclusion and non-discrimination more consciously. The Agreement defines seven target areas based on the UN Convention on the Rights of Persons with Disabilities. The aim is to give applicants with severe disabilities who have appropriate qualifications greater access to suitable jobs. Participation in a talent programme organised by the Vienna-based company myAbility Social Enterprise GmbH offers young students with disabilities access to KfW through introductory days. Every year, around five to eight talents come to KfW for taster days. Of these, one person was subsequently hired in 2024. One key action for KfW employees with severe disabilities is, for example, the accessible design of the working environment. Severely disabled employees are entitled to various benefits to compensate for the disadvantages they face, including six days of additional leave, exemption from overtime and a disabled-friendly parking space. KfW supports employees to obtain aids to make their working environment as accessible and suited to their disabilities as possible. In terms of accessible communication, sign language courses are on offer, and sign language interpreters are engaged at events. Visually impaired employees can be provided with an accessible "Fast Viewer version".

To reduce prejudices against employees with severe disabilities, voluntary awareness workshops and inclusion days are held for all employees. Around 30 to 40 employees take part in the training sessions every year. Around 1,000 employees take part in the health and inclusion days at all locations combined. An explicit support offer is provided to managers and teams for successful inclusion. This includes external consulting for managers of KfW and KfW IPEX-Bank in case of uncertainty about the impact of a staffing decision. The actions for inclusion are ongoing and do not have a specific end date.

KfW IPEX-Bank has set targets for the proportion of women in leadership positions in line with the German Act for the Equal Participation of Women and Men in Leadership Positions in the Private and Public Sector (Führungspositionengesetz). These targets are listed in the table "KfW Group's targets regarding employee diversity and inclusion". KfW IPEX-Bank has already initiated actions to achieve these targets, with further actions planned. For instance, an individual programme has been launched for employees working in Germany who express an interest in a leadership role. The "Leadership Prospects" programme was introduced in 2022 and extended after originally being intended to last 12 to 18 months. The programme includes a needs analysis, workshops, group coaching, networking, dialogue formats, mentoring and shadowing. The aim is to get more employees, especially women, interested in leadership so that they sign up for and complete the potential assessment programme. The programme for the internal actions is aimed at women within KfW IPEX-Bank who are interested in management or already in a management position; the external actions are targeted at external female applicants. The associated programme actions are being implemented on an ongoing basis. If programmes such as mentoring and shadowing or certification expire, the aim is to continue them based on the same parameters. The network "Female Leaders of IPEX" has also been established for women in management positions and women who have passed the potential assessment programme with the aim to boost participation of women at KfW IPEX-Bank in KfW programmes overall. Recruiting days are being organised to attract female graduate trainees and high-potential female employees are being specifically approached by the responsible manager when management positions become vacant.

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The actions defined by DEG in its Equal Opportunities Plan are to be implemented by 31 December 2027. Regarding gender empowerment, DEG is committed to addressing women and motivating them to participate in career development programmes. High-potential employees are provided with targeted support, such as mentoring, shadowing and specific training programmes. To reduce potential barriers to taking steps towards leadership, DEG conducts surveys on the attractiveness of leadership roles. The goal is to specifically encourage and enable women to take on responsibility within the framework of board mandates – a position on the supervisory board of a company in which DEG holds a stake or which it finances – or the management interdisciplinary projects.

DEG is committed to creating management positions as job shares. The goal is to create a “job share marketplace” where (potential) managers can register and apply for job sharing vacancies. In addition, care should be taken during the promotion round to ensure that there is no significant difference in the number of women and men promoted. The aim is to promote women in proportion to their share in the respective functional level.

Targets related to diversity and inclusion within the group’s own workforce

One of KfW Group’s general objectives is to actively support groups of individuals who tend to be more affected by discrimination, so that the resulting topics and scheduled targets for diversity and inclusion are an integral part of the sustainability agenda. Achieving the targets set out in the Equal Opportunities Plans is a key interim objective in meeting the requirements of the BGleiG from the perspective of KfW Group.

The KfW target for the proportion of severely disabled employees, as shown in the table below, is 6%, which is above the statutory 5% quota. The HR division and the Executive Board were involved in setting the target. The Executive Board receives information on the status of implementation every six months. Once the target had been set, all departments and representatives for disabled employees were given information on their status quo, need for development and the support measures provided by the HR department.

Specific metrics are reported to the Executive Board and Directors every six months in order to measure and evaluate the progress made in terms of inclusion and diversity. To measure the progress made in diversity management at KfW, a “diversity” KPI was developed and implemented in the strategic objectives 2029. Information underlying the “diversity” KPI is collected annually by the company Barbara Lutz Index Management GmbH (Fki Diversity for Success), based in Unterföhring, which was commissioned by the Federal Ministry for Family Affairs to provide the requisite academic support. The result is compared with a benchmark of all indexed companies and backed up with an ambition level and actions that also contribute to the equality and inclusion strategy. The methodology behind the survey of the index values includes a combination of qualitative and quantitative parameters. Social and diversity development are part of sustainable development. The indicator is measured for KfW in Germany. The target is 85 out of a total of 100 points by 2029, with 100 points being the maximum achievable score. The current value (for 2023) is 80 points. The KPI will be collected each year from 2023 to 2029. Employees were involved in setting the target as part of the engagement procedures described in the “Procedures for engaging with the own workforce and workers’ representatives” section of this chapter.

KfW has defined four overarching targets relating to diversity, equality and inclusion in its Equal Opportunities Plan. These include making equal opportunities part of corporate culture at KfW, identifying and eliminating structural disadvantages, improving the reconciliation of family life, care-giving and work, and increasing the proportion of women in management and senior specialist positions. The stated increase in the proportion of women is underpinned by a quantitative target and shown in the table below. The targets for the proportion of women are to be achieved at the levels of heads of department, heads of division and team heads. Demographic trends were taken into account when setting the target and were discussed in the Executive Board dialogue.

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Further impact indicators for this target include the number of job shares and the proportion of part-time management positions. The tandems are management tandems at team management level. Two managers share team leadership and can utilise up to 1.4 full-time equivalents for this purpose. Target achievement is tracked by measuring the impact of individual actions. The impact of the actions in terms of anchoring gender equality in corporate culture at KfW is measured based on the number of participants in panel discussions, webinars and seminars, the associated number of clicks, data trends from HR department reports, and the answers to equality-related questions in the employee survey. Identifying and eliminating structural disadvantages is measured using the same sources, as well as by looking at salary trends for new hires and transfers over time among other means. In particular, the inclusion rate and the proportion of women with severe disabilities or equal status also play a role. In particular, the inclusion rate and the proportion of women with disabilities or equal status also play a role here.

KfW IPEX-Bank's strategy provides for a gender-neutral personnel policy and sets targets for equal participation in leadership positions and on the Board of Supervisory Directors. The quota relates to all KfW IPEX-Bank managers worldwide, including subsidiaries, and all branches and foreign branch offices. The quotas are based on the ratio of women to all managers at the relevant level and use the number of women and men at the level concerned as key metrics. The HR department is responsible for measurement and monitoring, with quarterly reporting for Management Board control. The regular measurements always take place at the end of a quarter and are compared with the target value for 30 June 2027; there are no milestones or interim targets. The target ratio was determined taking into account the current or planned number of management positions and the gender distribution, projection regarding age-related departures, and assumptions regarding (re)appointments. The Management Board and the Board of Supervisory Directors of KfW IPEX-Bank were involved in the determination process. Current trends and changes in the company's performance have no impact on the target-setting process. The quotas and the current level of target achievement are taken into account when (re)filling management positions.

Support for structurally disadvantaged groups is also addressed at an early stage, with a target quota to be achieved for female graduate trainees at KfW IPEX-Bank in Germany set back in 2024, as shown in the table below. The focus is on recruiting female graduate trainees, provided they are equally suitable candidates. The distribution of female and male graduate trainees is considered in every recruitment decision. The quota of 60% applies to the respective current year. No stakeholders were involved in the target-setting process. The quota was set taking into account the current equal distribution of women and men, and the fact that significantly fewer women are interested in leadership. To increase the number of interested female employees, the target was set in favour of female graduate trainees. In the 2024 financial year, the target figure was not met due to the application situation. Only 30% of the applications received were from female applicants.

At DEG, the targets described in the table below, "Proportion of women in the potential pool" and "Proportion of women in development programmes", were designed to increase the proportion of female participants in the Professional Development Programme ("PDP") and mentoring schemes, for example. The stages in the potential pool relate to the potential assessment programme used to select managers. The first selection stage consists of an aptitude assessment interview, the second selection stage includes an aptitude test in which an individual's leadership potential is assessed. The target for the first selection stage was not reached in 2024. The figures are volatile, as this is a small target group in which there is a lot of movement. For example, employees who complete an assessment centre after the first stage are no longer counted. The proportion of women in the first selection stage corresponds to the proportion of women at the 'Senior Manager' function level, from which the potential pool is largely recruited. The quota has risen by 26.7% since the adoption of the equality plan.

The goal of achieving gender balance is intended to help eliminate structural disadvantages and further boost the proportion of women at management level and in senior specialist positions. DEG defines the targets for achieving equal participation among women and men. Each of the targets is based on legislation, DEG's ambitions and internal modelling of feasible results within the term of the plan.

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KfW Group's targets regarding employee diversity and inclusion

Action area (scope of application)	Target	Function	Actual value (31 Dec. 2024)	Target value	Target year
			%	%
Inclusive working environment that ensures equal opportunities and non-discrimination (KfW)	Proportion of employees with severe disabilities		6.0	6.0	Annually
Inclusive working environment that ensures equal opportunities and non-discrimination (KfW)	Increasing the proportion of women in management and senior specialist positions	Heads of department	30.8	30.0	2027
		Heads of division	40.6	40.0
		Team heads	39.4	42.5
Promotion of structurally disadvantaged groups in management positions (DEG)	Proportion of women at selection stages 1 and 2 of the potential pool	Selection stage 1	38.0	50.0	Ongoing minimum value until 2027
		Selection stage 2	67.0	50.0
Promotion of structurally disadvantaged groups in management positions (DEG)	Proportion of women participating in development programmes (PDP, mentoring, etc.)		60.0	60.0	Ongoing minimum value until 2027
Inclusive working environment that ensures equal opportunities and non-discrimination (DEG)	Increasing the proportion of women in management and senior specialist positions	Heads of department	45.0	40.0	2027
		Heads of division	36.0	40.0
		Management level 3^{1)}	36.0	50.0
		Management level 2^{2)}	42.0	50.0
Promotion of structurally disadvantaged groups in management positions (KfW IPEX-Bank)	Equal participation in management positions Board of Supervisory Directors	Management Board	50.0	50.0	30 June 2027
		Heads of division	33.3	40.0
		Team heads	34.9	40.5
Inclusive working environment that ensures equal opportunities and non-discrimination (KfW IPEX-Bank)	Proportion of female graduate trainees		48.3	60.0	Annually

1) Management level 3 – Specialist coordination and country office direction
2) Management level 2 – Senior management

Metrics related to diversity and inclusion within the group's own workforce

As of 31 December 2024, KfW Group had a total of 8,838 employees. As this relates to the number of employees on the reporting date, the figure differs from the average figure shown in the financial report under "Average number of employees during the financial year" in the consolidated financial statements. The breakdown of the number of employees by various characteristics (e.g. gender) is shown in the following tables. All metrics are measured as of the reporting date and always relate to the head count.

Employee turnover at KfW Group was 5.3% in 2024. A total of 454 employees left KfW Group in 2024. Employee turnover refers to all employees who left the company during the reporting period either voluntarily or due to dismissal, retirement or death. The turnover figure does not include the expiry of temporary contracts, employees who left because they moved to different positions within the group, or secondments. The departure measure relevant to the employee turnover rate is counted on the first day after the official termination of the contract of employment.

The following employee metrics are stated on a head count basis as of 31 December 2024. Specific methods and assumptions were not used in collecting the data; the system counts and totals the figures.

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Number of employees by gender

	31 Dec. 2024
Female	4,261
Male	4,577
Other	0
Not reported	0
Total	8,838

Number of employees by region and country¹)

	31 Dec. 2024
Germany²)	8,387
Rest of the world	451
Total	8,838

¹) Breakdown by country for countries with more than 50 employees, accounting for at least 10% of KfW Group's total workforce
²) This also includes employees assigned to foreign posts.

Number of employees by type of contract and gender as of 31 December 2024

	Female	Male	Total
Permanent employees	3,777	4,050	7,827
Temporary employees	484	527	1,011
Non-guaranteed hours employees¹)	0	0	0
Total	4,261	4,577	8,838

¹) Workers with no guaranteed minimum or fixed number of working hours. While the employee must be available to work as required, the employer is under no contractual obligation to guarantee the employee a minimum or fixed number of working hours per day, week or month.

Gender distribution at top management level at KfW Group¹)

	31 Dec. 2024
	Head count	%
Female	11	29.7
Male	26	70.3
Other	0	0.0
Total	37	100.0

¹) Top management level is defined as the level below the Executive Board; within KfW Group, this is the head of department level. The subsidiaries are included in this framework with their management level.

Number of employees by age group

	31 Dec. 2024
< 30 years of age	1,133
30 ≤ 50 years of age	4,664
> 50 years of age	3,041
Total	8,838

KfW Financial Report 2024

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Remuneration

Policies related to remuneration within the Group's own workforce

The group-wide remuneration strategy policy in accordance with Section 27 of the Remuneration Regulation for Institutions (Institutsvergütungsverordnung – “InstitutsVergV”) sets out the overall parameters for remuneration within KfW Group. KfW Group is expressly committed in its procedural rules to transparent and non-discriminatory remuneration principles and evaluation processes. The procedural rules stipulate that the remuneration systems should not differentiate on the basis of gender, nationality, ethnic origin or religion. They describe the key aspects of performance management and (variable) remuneration, as well as the parties involved and responsibilities within the remuneration process. These rules apply to all group employees with a German employment contract. The remuneration paid to employees working abroad whose employment contracts are subject to local law in that country, and to whom KfW's staff agreements do not apply, is not included in KfW's remuneration system. KfW ensures, however, that the remuneration paid to these individuals meets the requirements set out in the Remuneration Regulation for Institutions by summarising the remuneration rules for national staff at foreign sites in employment guidelines.

The objectives of the remuneration strategy are:

To align remuneration instruments and processes with the group's business and risk strategy
To support employee retention and recruitment and thereby ensure that personnel requirements are met
To ensure transparency regarding changes of position within each company and between the companies in the group
To define a standardised framework for the design and implementation of processes for performance management and remuneration structure
To ensure appropriate remuneration systems, in particular to avoid any incentives to take disproportionately high risks
To ensure clear and transparent remuneration systems
To implement and monitor the relevant regulatory requirements

As the parent institution, KfW ensures compliance with the regulatory requirements for remuneration at the subsidiaries and works towards the implementation of, and compliance with, the group-wide remuneration strategy. To this end, it reviews compliance with the requirements set out in Section 27 InstitutsVergV at least once a year, i.e. compliance with the group-wide remuneration strategy. The following aspects are reviewed for compliance: strategic relevance of the remuneration systems, misguided incentives and negative performance contributions, guaranteed variable remuneration, severance payments and retention awards, bonus cap, total amount of variable remuneration and hedging transactions. KfW must also be involved by the group subsidiaries in any processes introducing new or revising existing remuneration system concepts. This ensures that new concepts comply with the regulatory requirements and are consistent with the group-wide remuneration strategy. Deviating regulations must be reviewed by KfW's HR department before being approved by the Executive Board with the involvement of the responsible supervisory body. In accordance with the Remuneration Regulation for Institutions, the Board of Supervisory Directors monitors the appropriateness of the employee remuneration systems, which also involves setting the total amount of variable remuneration.

The subordinate remuneration strategies of KfW IPEX-Bank, DEG and the Bylaws and business strategy of KfW Capital describe the parties involved and responsibilities within the remuneration process. The companies review their systems and the underlying remuneration metrics once a year to ensure that they are appropriate and compatible with the business and risk strategies. The Board of Supervisory Directors/supervisory boards of the subsidiaries receive the documented results. Where shortcomings are identified, KfW promptly draws up an action plan. The Executive Board of KfW is responsible for the remuneration process and, as a result, for ensuring an appropriate remuneration system structure, as well as for providing annual information to the Board of Supervisory Directors.

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KfW Group employees in Germany covered by collective bargaining agreements are subject to the regulations of the collective bargaining agreement for public banks. Activities that fall under collective bargaining agreements are assigned in accordance with collective bargaining pay-scale groups and remuneration is paid accordingly. Among other things, the collective bargaining agreement includes regulations on working hours, pay, annual leave and termination of employment. Employees not covered by collective agreements are subject to similar working and employment conditions as employees who are covered by a collective agreement; the applicable collective bargaining agreement also serves as a frame of reference for contracts of the former group of employees. The main working conditions are regulated in particular in staff or works agreements negotiated and concluded between the employer and the Staff Council or Works Council. KfW Capital is not bound by collective bargaining agreements.

The Remuneration Committee of the Board of Supervisory Directors of KfW and DEG, the Board of Supervisory Directors of KfW IPEX-Bank and the Supervisory Board of KfW Capital are responsible for supporting the Board of Supervisory Directors/supervisory body in monitoring an appropriate structure of the remuneration systems for employees. This also includes the annual review to determine whether the defined principles for setting remuneration metrics are appropriate, the total amount of variable remuneration has been calculated properly, the performance contributions and performance and retention periods are appropriate, and the remuneration systems meet the requirements set out in the Remuneration Regulation for Institutions or, for KfW Capital, the Investment Firm Remuneration Regulation (Wertpapierinstituts-Vergütungsverordnung) and the German Investment Firm Act (Wertpapierinstitutsgesetz). The remuneration metrics must be consistent with the remuneration strategy and support the achievement of the strategic objectives, which at KfW Group include non-discriminatory remuneration in line with standard market conditions.

The committee also monitors the remuneration systems for the heads of the Risk Controlling and Compliance functions and the risk takers, as well as the process for identifying risk takers. In addition, the committee monitors the appropriate structure of the remuneration system for managing directors and prepares for the supervisory board consultation on their remuneration. In accordance with Section 10 of the German Transparency in Wage Structures Act (Entgelttransparenzgesetz), employees have been able to assert their individual right to information to verify gender-neutral pay since 2018. This means that they can seek information on the criteria and procedures used to determine pay and receive written information on the statistical median of the average gross monthly remuneration extrapolated to full-time equivalents, as well as up to two individual salary components of a peer group. All companies in the group have implemented this statutory requirement; KfW Capital is not affected, as it has fewer than 200 employees, meaning that implementation of the right to information is reviewed on a case-by-case basis.

Actions related to remuneration within the Group's own workforce

Various actions relating to remuneration and other benefits for KfW Group's own workforce are in place to ensure implementation of the policies and their processual anchoring. These are explained in the chapter below. The group aims to continuously ensure the satisfaction of its employees by providing appropriate remuneration and social benefits in line with market standards. To make sure that the remuneration systems are gender-neutral, salaries are set based on a grading structure in which equivalent functions are assigned to salary bands.

In addition, a gender-sensitive remuneration policy is ensured by identifying and eliminating structural disadvantages. For this purpose, possible "structural cases" will be identified at KfW and DEG in advance of the salary review, in particular structurally disadvantaged women and part-time employees, which will result in effective and sustainable salary adjustments by the department. To identify these "structural cases", all directors received an evaluation, at the start of the 2023/2024 salary review, showing which female employees stand out in particular as regards their remuneration with a view to equal pay, meaning that they are considered "structural cases". The gender pay gap of the peer group was used to identify the women who stood out statistically in terms of their deviation from the peer group in the context of the salary review. The heads of department were asked to pay attention both to differences in performance and to reducing gender-specific imbalances when allocating the budget. Special attention was to be paid to the women identified, as they make a particularly marked statistical contribution to the gender pay gap. During the salary review, the gender pay gaps of the departments and levels were monitored on a regular basis in order to present transparent information on the impact of the planned salary adjustments on department

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gender pay gaps. For those employees not covered by a collective bargaining agreement, the results of the salary review had a consistently positive effect on the gender pay gap for annual target salaries at the relevant non-pay scale levels.

In order to implement equal pay for women and men, DEG is enhancing the tools used to analyse the remuneration structure based on parameters such as gender, age, length of service and function level. An external benchmarking process is designed to make the competitiveness of the remuneration structure more transparent. If a salary equalisation measure is not implemented for employees with a comparable performance evaluation, separate grounds must be furnished by the department concerned, along with a plan for future effective and sustainable development. Performance aspects, incentives and structural equal treatment of employees are given equal weighting in salary adjustments.

Moreover, an external, independent pay equity analysis was conducted for KfW, KfW IPEX-Bank and DEG in Germany for the first time in 2024 by the Frankfurt-based company Lurse AG. All three companies received a positive outcome from the analysis and met all requirements for the Lurse pay equity certificate which is valid for two years. The next step is a review of the results of the pay equity analysis at individual institution level in 2025, with further targeted actions derived as necessary. KfW, KfW IPEX-Bank and DEG were also designated "Universal Fair Pay Analysts" based on the "Universal Fair Pay Check" conducted by the Berlin-based company FPI Fair Pay Innovation Lab gemeinnützige GmbH. The FPI certificate is valid for one year. The pay equity analysis is to be repeated at KfW and KfW IPEX-Bank in 2025 with the aim of being recertified by FPI and being able to track any developments.

The "conditions" dimension in the core element "top-performing KfW" of the KfWplus agenda was reviewed as part of the "Employer positioning" project in 2023. KfW Group employees with a German employment contract are entitled to employer-financed pension benefits for the duration of their employment as well as to receiving disability benefits and benefits for surviving dependants. The scope, exact details and amount of the company pension are based on the pension regulations set by KfW and its subsidiaries. The group also offers its employees with a German employment contract the following additional benefits: voluntary deferred compensation for pension benefits, mobility benefits, such as reimbursement of commuting costs, reimbursement for the "Deutschlandticket" monthly travel pass, free parking spaces and private accident insurance. KfW and DEG also offer their employees with permanent German employment contracts several additional benefits, such as access to low-interest building loans, occupational incapacity insurance, capital accumulation benefits (vermögenswirksame Leistungen) and, as of 2024, bicycle leasing, which was also introduced at KfW Capital.

Targets related to remuneration within the group's own workforce

The policies and actions described above contribute to the promotion of non-discriminatory and transparent pay for KfW Group employees. While no specific, measurable and results-based targets have been defined, qualitative objectives are in place.

The general objectives of the group-wide remuneration strategy are described at the beginning of this section. As part of KfW's Equal Opportunities Plan, the goal of "identifying and eliminating structural disadvantages" also contributes to ensuring a gender-sensitive remuneration policy. The effectiveness of the policies and actions is measured by the salary trend for new hires and transfers over time.

DEG's targets include increasing the transparency of the data basis for the remuneration structure, ensuring a gender-sensitive remuneration policy, and avoiding structural discrimination in new hires and the salary trend. As both plans apply from 1 January 2024, progress will be measured from 2024.

Metrics related to remuneration within the group's own workforce

The relevant remuneration metrics and associated methodology are described in this section. The proportion KfW Group employees covered by collective bargaining agreements in the European Economic Area ("EEA") is 25.7%. A total of 98.8% of the group's employees in the EEA have workers' representatives. The table below shows the collective bargaining coverage and proportion of employees with workers' representatives in Germany.

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Collective bargaining coverage and social dialogue

| Coverage rate | Collective bargaining coverage
Employees – EEA
(for countries with > 50 employees
accounting for > 10% of the total number) | Social dialogue
Workplace representation (EEA only)
(for countries with > 50 employees
accounting for > 10% of the total number) |
| --- | --- | --- |
| 0–19% | | |
| 20–39% | Germany | |
| 40–59% | | |
| 60–79% | | |
| 80–100% | | Germany |

The appropriateness of remuneration at all group sites was analysed in financial year 2024 to ensure that all employees receive an adequate wage. The focus was on the statutory minimum wage in the countries within the EEA. In countries outside the EEA, the adequate wage was determined based on a range of criteria. The review showed that all KfW Group employees received an adequate wage in financial year 2024.

The gender pay gap according to the ESRS calculation was 14.0% in financial year 2024 and is defined as the difference between the average gross hourly pay of female and male employees. Gross hourly pay is calculated by dividing total annual remuneration by the target working hours, or by the hours worked in cases involving temporary student employees. The total annual remuneration includes the following items, provided they were paid in the reporting period: wage and salary payments, remuneration for work performed (remuneration for hours worked including overtime, shift allowances), remuneration for working hours lost/absence, as well as one-time payments such as bonuses, holiday bonuses, other fixed one-time payments, company performance bonuses, individual performance bonuses, other variable one-time payments and non-monetary (in kind) benefits. The pay components are calculated based on the accrual principle. The gender pay gap is unadjusted, i.e. factors such as qualifications, employment history and employment scope and activity are not taken into account.

The ratio of the total annual remuneration paid to the highest-paid individual at KfW Group to the annual median total remuneration paid to all employees is 10.6. The total remuneration included in this calculation includes the same pay components as those included in the gender pay gap. Please note for the purposes of this metric, that 28.1% of employees work part-time, meaning that they receive lower total annual remuneration. Furthermore, in line with the definition of employees, the remuneration metrics also include the salaries paid to interns, temporary student employees and vocational trainees. These two effects reduce the median income overall.

All the metrics explained relate to the reporting date based on the accrual principle as of 31 December 2024.

Working conditions

Policies related to working conditions within the group's own workforce

For KfW Group, for example, the structure of working hours and the promotion of work-life balance are key aspects when it comes to fulfilling employees' individual needs and supporting their performance. The policies related to working conditions at KfW Group are described in detail below.

The policies related to working conditions at KfW Group are derived from the group's mandate and business strategy. They include promoting employability and creating a sustainable working environment as an attractive employer in order to recruit and retain the best employees, objectives pursued in the "Employer positioning" project described in the "Diversity and inclusion" section of this chapter. Working conditions at KfW Group are set out in procedural rules that are agreed between the employer and the Staff Council or Works Council, and apply to employees in Germany with a German employment contract. Overall, KfW and each of the companies follow the policies described in the "Social matters at KfW Group" section of this chapter and other statutory requirements and provisions, including the German Act on the Implementation of Measures of Occupational Safety and Health to Encourage Improvements in the Safety and Health Protection of Workers at Work (Arbeitsschutzgesetz), the German Ordinance on Workplaces (Arbeitsstättenverordnung),

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Book VII of the German Social Code (Sozialgesetzbuch VII) and the German Maternity Protection Act (Mutterschutzgesetz). The labour and health protection law of the respective country applies to employees with a foreign employment contract. German labour and social security law also applies when employees are assigned to posts abroad and are not subject to foreign social security obligations.

Key aspects of working conditions from KfW Group's perspective include flexible working hours and locations, as well as striking a balance between work, family life, care-giving and personal life. For KfW, the relevant work-life balance policy can be found in the sixth Equal Opportunities Plan, which is explained in more detail in the "Diversity and inclusion" section of this chapter. The issue of flexible working hours and locations is also covered, for KfW, in the staff agreements on mobile working, workations and working hours; for KfW IPEX-Bank and DEG, the regulations can be found in the corresponding works agreements.

KfW Group operates preventative occupational health and safety management services to promote employee health. The focus of these services is to provide an appropriate working environment, including ergonomic workstations, to prevent risks and accidents at work, and thereby also prevent and minimise sick days. The issue of health is addressed in the German Works Constitution Act (Betriebsverfassungsgesetz – "BetrVG"). Actions to minimize hazards are based on the activity-oriented risk assessment to be carried out on a decentralised basis by managers. The implementation process, along with guidelines on occupational health, is set out in policies and work instructions based on the statutory health and safety regulations, such as the German Occupational Safety and Health Act and accident prevention regulations. The risk assessments focus in particular on groups of persons not only active in an office context. Personal risk assessments are conducted for particularly vulnerable individuals.

Actions related to working conditions within the group's own workforce

Various actions are in place within KfW Group to ensure implementation of the policies and their establishment in corresponding processes. As part of the "Employer positioning" project, the group is focusing on flexible working models to facilitate employees' work-life balance. The three main components are a range of individual part-time models, flexible working hours using a flexitime model and mobile working. Work-life balance is covered by a staff agreement, and works agreements for the subsidiaries.

Mobile working is an option on a 60:40 basis for employees in Germany working for KfW, KfW IPEX-Bank and DEG (60% of working hours worked outside of the office and 40% in the office), and without a fixed ratio at KfW Capital. In addition to the statutory and collectively agreed regulations, KfW and KfW IPEX-Bank offer additional leave of absence schemes in order to promote a better work-life balance. These are set out in a staff agreement at KfW and in a works agreement at KfW IPEX-Bank and DEG and include overall conditions for time-off for childcare purposes, care-giving for close relatives and for other personal reasons (e.g. sabbaticals). Another action to meet the target of a top-performing KfW as part of KfWplus, "Flexibility to boost employee satisfaction and recruitment" was implemented for the first time in 2024. Since July 2024, staff members, graduate trainees and sandwich-degree students working at KfW, KfW IPEX-Bank and KfW Capital who have been employed in Germany for at least six months and have EU citizenship can apply for up to 20 working days (pro rata for part-time employees, where applicable) per calendar year for mobile working abroad. DEG is also planning to implement the actions relating to mobile working abroad and sabbaticals based on KfW's regulations.

There are also actions relating to family and care-giving. Parent-child offices are a concept that has been introduced at every location. In addition, KfW and KfW IPEX-Bank maintain an in-house daycare centre with 45 childcare places at the Frankfurt office, and other support services are provided by external service providers such as pme-Familienservice. Moreover, in cooperation with a parents' association, ten childcare places at the Erasmus kindergarten and 66 crèche places at two other facilities are also reserved. For childcare at other facilities, employees can access extensive databases with lists of available places in day nurseries, after-school care facilities and schools. Employees across Germany can also access 24-hour emergency care from a family service all year round in the case of last-minute childcare requirements as well as virtual childcare options. KfW also organises childcare services provided by a family service where needed at conferences hosted by KfW. Assistance in finding babysitters and au pairs and a very comprehensive school holiday programme are also available. DEG offers its employees a childcare allowance in Cologne, as well as access to emergency childcare options via a family service provider and support in organising regular childcare options. To make it easier to plan a return to work after parental leave, DEG also provides

KfW Financial Report 2024

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a total of 15 childcare places. DEG additionally offers an extensive school holiday programme and an academy providing trainings on topics for parents. KfW Group has its own fathers' network and has been a member of the nationwide fathers' network Conpadres since 2019. KfW, KfW IPEX-Bank and DEG offer a programme for people with care-giving responsibilities, including, in particular, dedicated care guides, on-site consultation sessions, a 24/7 hotline and information events.

KfW's aim is to facilitate the balance between work, family, care-giving and personal life for women and men alike. In a quest to improve childcare and care-giving for relatives, a location-specific survey on employees' demand was conducted in Germany in 2024 as part of the "Employer positioning" project. Based on the results of the survey, KfW is looking into suitable actions and developing new services taking into account the infrastructure conditions. The work-life balance agreement will be updated in the coming years and expanded to include new work-life balance components.

Employees at other stages of life are also supported with offers and fringe benefits. Older employees of KfW and KfW IPEX-Bank in Germany have the option of continuing to work beyond the statutory retirement age if the employee and employer agree. There is also a "reverse mentoring" scheme for managers, where experienced managers are supported by "digital natives" from the Digital8 network acting as their mentors. In addition, the long-standing "management job sharing" HR development tool is to be enhanced by a focus on "management job sharing combining different age groups", alongside "better balance". A corresponding action is currently being planned.

As part of its Equal Opportunities Plan, DEG is planning several actions to improve working conditions and thereby also to increase employer attractiveness and employee satisfaction. The current offerings to facilitate a work-life balance, particularly in the context of childcare, care-giving for relatives and other aspects of work-life balance, are reviewed at regular intervals as part of the "audit workandfamily" recertification process. The needs of employees returning from parental leave are also reviewed and the reintegration process is adapted if necessary. In order to promote flexible working hours and the use of parental leave by fathers, DEG is analysing possible obstacles and developing targeted actions to overcome them. The overall aim is to continuously adapt and enhance the work-life balance offers and overall conditions to meet the needs identified.

The effectiveness of all actions is measured as part of the employee survey. For further information, please refer to the "Procedures for engaging with KfW's own workforce and workers' representatives" section of this chapter.

For local KfW Group staff working in KfW Group's offices abroad, the working conditions and social benefits that apply at least match, if not exceed, the relevant national legal requirements and are based on the benefit level of comparable international companies locally. The regulations for national employees can be found in separate employment guidelines issued by KfW Development Bank, KfW IPEX-Bank and DEG. The aim is also to apply the requirements and agreements applicable to employees in Germany, such as regarding flexible working hours/locations, inclusion and diversity, in the same way to the foreign offices depending on the local context and needs. When assigning employees to foreign posts, the group provides additional benefits which take account of economic and safety requirements. These additional benefits address both the local situation and the differences between the home and host countries.

Targets related to working conditions within the group's own workforce

As part of its corporate objectives on working conditions, the group has focused on the possibility of mobile working and on fostering a results-based work culture. KfW Group does not set any overarching quantitative targets for these aspects. Overall, effectiveness is measured in the context of regular employee surveys, as explained in the "Procedures for engaging with KfW's own workforce and workers' representatives" section of this chapter, as well as by monitoring employee turnover and incoming job applications, among other things.

While KfW has not defined any quantitative targets as part of its Equal Opportunities Plan, the impact of the actions described is measured and tracked. The overarching qualitative objective is to "improve the balance between work, family life, care-giving and personal life for women and men alike". Improvements in the options for childcare and the care-giving for relatives are measured, for instance, based on criteria such as the number of childcare places, the use of school holiday and emergency childcare places, and care-giving services.

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In addition, the overall effectiveness of the actions taken as part of the “Employer positioning” project is measured based on an “Employer attractiveness” KPI as part of the strategic objectives 2029. The KPI is based on both internal and external employer attractiveness, with the data is collected jointly with an external market research institute. Going forward, internal employer attractiveness will be measured on the basis of the engagement index as part of the regular employee survey, in line with the market standard. The index is measured based on six different items (e.g. the extent to which employees would recommend their employer to others) which are then used to calculate an average. Limitations of the employee survey include the fact that it is not possible to obtain more in-depth information on the motives behind the responses as part of the survey. However, this is compensated for by an extensive qualitative follow-up process. The engagement index is an established index on the market that has also been validated with an external market research company. The index can be compared against other organisations in the benchmark. External employer attractiveness is a weighted index of various factors that are combined with the company’s representative peer group. The index is measured on the basis of three factors (e.g. visibility, intention to apply) in the relevant target groups, which are then used to calculate a weighted average. An external market research institute compiles the index every two years and carries out benchmarking against the peer group.

DEG has defined two targets in relation to the defined work-life blend action area, as shown in the table below. In future, additional capacity corresponding to at least 0.2 full-time equivalents is to be created when filling management job share positions. In addition, DEG aims to create a “job share marketplace” allowing (potential) managers interested in working part-time or in a job share model can register and apply for job sharing vacancies. DEG has found that there are many opportunities on offer to allow employees to strike a balance between work, family, care-giving and personal life. In the area of work-life balance, these are safeguarded by regular re-audits (audit workandfamily) to maintain certification by the Hertie Foundation, which DEG has held for ten years now. The offers are currently taken up largely by women. For DEG, encouraging increased use of part-time and temporary part-time models and parental leave by male employees is a goal worth working towards to achieve an improved gender balance. There is also a particular need to promote greater flexibility in working hours in the management ranks. As well as taking targeted steps to facilitate further part-time and job sharing solutions in management, all parties involved are to strive to make part-time management roles a possibility.

DEG’s targets in relation to working conditions

Action area (scope of application)	Target^{1)}	Actual value 2024	Target value	Target year
Promotion of structurally disadvantaged groups in management positions (DEG)	Part-time management (including job share partner)	8	8	2027
Promotion of structurally disadvantaged groups in management positions (DEG)	Management job shares	4	3	2027

1) Targets have currently been defined at DEG only. Table content is therefore limited to DEG. However, the offer is available throughout KfW Group.

Procedures for engaging with the own workforce and workers’ representatives

Due to the various laws on employee participation (German Federal Personnel Representation Act [Bundespersonalvertretungsgesetz – “BpersVG”] and the German Works Constitution Act) it is not possible to create a works council for KfW Group as a whole. As a result, there is no group-wide, standardised procedure for KfW Group to engage with its own workforce and workers’ representatives. However, each company has put its own procedures in place, which are described below. An agreement with employees on representation by a European works council, a works council of a Societas Europaea (“SE”) or a works council of a Societas Cooperativa Europaea (“SCE”) is not required by law.

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The social interests of employees at KfW Group are represented by the trade unions and the company's social partners. Employees have the right to freedom of association, which includes the right to form associations to protect and advance working and economic conditions. KfW is subject to the German Federal Personnel Representation Act. Employee interests are represented by a General Staff Council, which is responsible for issues across all sites and generally meets once a month, and by the three Local Staff Councils in Frankfurt, Bonn and Berlin, which generally meet once a week. Among other things, the Staff Council is responsible for ensuring that regulations benefitting the group's own workforce are complied with and implemented. It must address suggestions and complaints raised by employees and negotiate with KfW's management where there is a legitimate interest in doing so; it is also involved in organisational, social and HR-related matters and can negotiate and conclude staff agreements with KfW. KfW IPEX-Bank and DEG are subject to the German Works Constitution Act and have their own works councils and supervisory boards with elected workers' representatives who can be approached at any time. Among other things, the works councils are involved in the negotiation of works agreements at an early stage. If necessary, initial ideas are also discussed with employees. The workers' representatives, along with the equal opportunities officers, the (general) representatives for youth and vocational trainees and the (general) representatives for severely disabled employees are institutions that monitor compliance with laws and (company) regulations and serve as direct points of contact for employees in the event of individual questions or conflicts of interest.

KfW Capital does not have a works council or any established procedures for engaging the workforce or workers' representatives. This is also based on the German Works Constitution Act, which does not stipulate any obligation to create a works council if a company has only a small number of employees. There are, however, (informal) dialogue formats to include and address workforce concerns and demands. This informal engagement is a feature throughout the group.

The staff councils hold monthly meetings with the Chief Human Resources Officer and the Head of HR, particularly on all matters that have a significant impact on employees. There are monthly dialogue sessions between HR staff and all staff from the equal opportunities office, as well as monthly dialogue with the employees from the representative office for disabled employees. A fortnightly meeting is also held between the deputies of the equal opportunities office and the Head of HR. Every six weeks and when specific issues arise, the general representatives for severely disabled employees, the general representatives for youth and vocational trainees and the General Staff Council Executive Board meet with the Head of HR and an administrator responsible for the general representatives for severely disabled employees. Operational responsibility for engaging employees and ensuring that the results are incorporated into the company policy lies with the responsible heads of department and the Executive Board, depending on the topic.

The responsible bodies and affected employees are involved as extensively as possible at an early stage, especially during change processes – such as internal restructuring, major new projects and decisions on corporate strategy. This inclusion process can include face-to-face information from line managers, in-house information events and intranet notifications. The interests of KfW's female employees are also represented by the equal opportunities officers and their three deputies elected in accordance with the requirements of the German Federal Equality Act. Furthermore, the interests of employees with severe disabilities are represented by the relevant KfW, KfW IPEX-Bank or DEG representatives for employees with severe disabilities. These representatives have the right to attend all meetings of the Staff Council concerned, the occupational health and safety committees and workplace inspections in an advisory capacity.

Potential obstacles relating to the inclusion of specific individuals in the workforce (e.g. language and cultural differences) are addressed and efforts made to prevent them. A team charter is drawn up in each team at KfW and KfW IPEX-Bank in accordance with the staff or works agreement in order to emphasise any special features of collaboration. If complaints or comments are made, KfW Group's grievance channels can be used; these are described in more detail in the "Complaints management" section of this chapter. There are currently no staff councils at the individual foreign sites; the employees are involved directly at these offices.

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In order to engage employees and to review the effectiveness of the engagement processes and actions, a group-wide employee survey of all employees working in Germany has been conducted every two years since 2014 by an external consultancy. The catalogue of questions contains a mandatory section to evaluate satisfaction with overall conditions in the workplace and cooperation. The questions are checked for suitability before each survey. The equal opportunities officer, the Staff Council/works councils and the representatives for severely disabled employees are involved as stakeholders. The Staff Council/works councils are always involved in the preparation, implementation and evaluation as part of the employee participation process. The survey results allow comparisons to be made over time. Employees can use open comments to communicate requests and suggestions for improvements to working conditions.

The Executive Board and the management, consisting of heads of department, heads of division and team heads at KfW, use the survey results as the main basis for extensive follow-up work. This work is performed at all hierarchical levels using various dialogue formats: company-wide team and divisional workshops and management forums are used to analyse the results of the survey, define action areas for the relevant level and target group and adopt actions at departmental and company level as part of the employer positioning project. The management receives the results of their relevant organisational entity, along with instructions to discuss these results with their employees so that suitable improvement measures can be taken if necessary. The employee survey is analysed in detail at team or division level only if a defined minimum number of participants have completed the survey. Employees are given transparent information on the follow-up processes and decisions made based on the survey results on the intranet and by e-mail. The effectiveness and success of the actions taken can be evaluated with the help of the next survey.

The most recent group-wide survey was conducted in 2023. The survey sought information on the understanding of, and identification with, the KfWplus agenda, the company's attractiveness as an employer and key cultural issues at KfW Group. The format contained 112 questions. The feedback was processed in the "Employer positioning" project in 2023 in particular and forms the basis for the actions described. An equally intensive analysis of the survey results is conducted at DEG by the Management Board, executive staff and HR – on a self-directed basis in parallel with the activities at group level.

In addition to the official group-wide format, there are other individual survey formats that are not conducted on a regular basis but address individual topics more specifically. As part of the "Employer positioning" project, a voluntary, anonymised survey on current and/or future needs related to company childcare and care-giving support was conducted in April and May 2024. These surveys were initiated jointly by KfW and KfW IPEX-Bank, with the aim of tailoring work-life balance programmes to meet demand. The data was analysed via the external service provider Impuls and the results were incorporated into the development and adaptation of actions as part of the project.

Various stakeholder groups are integrated in the group's remuneration policies in different ways:

At KfW, shareholders are involved as stipulated in the KfW Bylaws through the Board of Supervisory Directors and the Remuneration Committee.
Employees in Germany can exert influence on staff or works agreements on remuneration matters through the workers' representatives – i.e. the staff and works councils – in accordance with the German Federal Personnel Representation Act or Works Constitution Act.
The Board of Supervisory Directors of KfW IPEX-Bank and Supervisor Board of DEG are each composed of one-third workers' representatives and two-thirds shareholder representatives in accordance with the German One-Third Participation Act (Drittelbeteiligungsgesetz). A workers' representative is also a member of the Remuneration Committee of the Board of Supervisory Directors/Supervisor Board and can be contacted by employees.
Transparency, i.e. access to information, is also ensured at DEG through the publication of the remuneration report as part of the notes to the annual financial statements and through the individual right to information in accordance with the German Transparency of Remuneration Act.

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Social matters in the banking business

The fact that the business sectors specialise in various financing and promotional products translates into different impacts, risks and opportunities in KfW Group's banking business with regard to social issues. A detailed description of the business models and activities of each company is provided in the "Strategy, business model and value chain" section in the "General information" chapter. The following section of the report describes policies, actions and targets that KfW Group uses to address material impacts along the value chain in the context of social information. The relevant stakeholders are value chain workers, affected communities, consumers and end-users, as well as corporate customers.

Value chain workers and affected communities

Policies related to value chain workers and affected communities

Downstream value chain workers

of KfW Group include employees of financed companies in direct business, employees of financing partners in the on-lending business and employees of funds and business partners in liquidity management (e.g. issuers of debt securities and trading partners). Details on the value chain are explained in more detail in the "KfW Group's value chain" section in the "General information" chapter. Only the downstream value chain is taken into consideration, as the focus is on the banking business due to its materiality. The main impacts, risks and opportunities relate in particular to employees at financed companies, both in direct financing and as customers in the on-lending business. Any influence over employees at on-lending banks, business partners and funds is very limited. Information on the impacts associated with these workers is not available in sufficient quantity or quality either. Regarding these companies in its value chain, the group relies on compliance with general statutory provisions or compliance with the regulations that apply to them in accordance with their business models. In developing countries and emerging economies, the higher risk and possibility of insufficient government controls on implementation of the E&S Appraisal and regular monitoring means that care is taken to ensure that these companies have an effective environmental and social management system themselves. The Code of Conduct, which was explained in the "Social matters at KfW Group" section of this chapter, also serves as a guide for externals and partner institutions.

This section also contains information on affected communities. These are communities that are (potentially) affected by the use of funds within the KfW Group product and service portfolio. Indigenous peoples are recognised as a particularly vulnerable group in society. For more detailed information, please refer to the "Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy" section in the "General information" chapter.

To fulfil KfW Group's business purpose and at the same time minimise potential adverse impacts on people and the environment, KfW Group conducts an E&S Appraisal on all planned domestic promotional business, project and export financing, as well as projects in emerging and developing countries. The E&S Appraisal procedures are laid down in the relevant sustainability guidelines of the business sectors (see the "Environmental and Social Appraisal Guidelines" section of the "Environmental information" chapter). Specific social topics covered by the individual sustainability guidelines are explained in further detail for each business sector below.

The sustainability guideline for the domestic promotional business takes into account respect for and protection of human rights in this area of influence as part of the human rights policy and formulates the goal of ruling out any involvement in human rights violations. With regard to value chain workers, the guideline stipulates the application of the standards referred to in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter as the benchmark for the E&S Appraisal.

KfW Development Bank

also assesses environmental and social sustainability based on the standards and requirements listed in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter. With regard to value chain workers, the requirements of World Bank Environmental and Social Standard 2 on Labor and Working Conditions, the World Bank Group's Environmental, Health and Safety Guidelines and the ILO Core Labour Standards are taken into account in the context of financing. If implementation or monitoring consultants are involved in a development bank project (such as a standard infrastructure project), their duties on site also include monitoring compliance with the ILO Core Labour Standards, with the actions defined in management plans for occupational safety, working conditions and resident protection, as well as with the corresponding KfW environmental, social and work safety-related requirements for contract awards. They are also responsible for remedying any shortcomings where necessary.

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With regard to affected communities, one of the aspects that is explored is the extent to which financed projects could pose risks to human health or safety, and whether they could lead to large-scale resettlement or significant loss of livelihoods. If the affected communities are indigenous peoples, KfW Development Bank implements the approval process in accordance with World Bank Environmental and Social Standard 7 and the Human Rights Strategy of the German Federal Ministry for Economic Cooperation and Development. This includes, among other things, the recognised principle of free, prior, and informed consent ("FPIC"). Specific actions are developed and implemented as part of collaborative participatory approaches, before being recorded and followed up on using an Indigenous Peoples Plan. Compliance with local environmental regulations and general efforts to minimise environmental risks also help protect affected communities. KfW Development Bank pursues a "do no harm" approach in all its projects. This means that KfW Development Bank actions must not reinforce existing disadvantages, but rather should contribute to reducing disadvantages wherever possible. Business sector KfW Development Bank is also examining the extent to which the provisions set out in the LkSG could be applied voluntarily to the financing business.

KfW IPEX-Bank's Sustainability Guideline calls for application of the standards and requirements set out in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter. They describe how human rights are addressed in financing projects, including value chain workers and affected communities. Impacts on affected communities, disadvantaged and vulnerable groups, safeguarding and ensuring respect for human rights through appropriate action to avoid adverse impacts on human rights and to address adverse impacts by taking appropriate actions, social matters in the workplace (including ILO Core Labour Standards) and occupational health and safety are assessed to determine the extent to which they may be relevant. Issues such as human trafficking, forced labour and child labour are covered in KfW's human rights policy and its subsidiaries by the Modern Slavery Act and the Equator Principles. If adverse impacts on indigenous peoples are identified, the project must consistently be reviewed to ensure it complies with IFC Performance Standard 7 „Indigenous Peoples" (including FPIC).

DEG's detailed procedure for environmental and social assessment and project monitoring is set out in the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter. With regard to value chain workers and affected communities, DEG assesses, also in accordance with the relevant IFC Performance Standards, the extent to which DEG financing could pose risks to human health or safety (IFC Performance Standard 4), whether it could lead to large-scale resettlement or significant loss of habitat and cultural heritage (IFC Performance Standard 5 and 8) and the extent to which indigenous peoples are likely to be affected (IFC Performance Standard 7). Compliance with local environmental regulations (including IFC Performance Standard 3 and 6) and general efforts to minimise environmental risks also help protect affected communities. DEG acts in accordance with the exclusion lists that apply to it, the contents of which are explained in the "Exclusion lists at KfW Group" section in the "Environmental information" chapter. Regarding human rights issues, the list expressly prohibits child and forced labour, also by taking into account the ILO Core Labour Standards.

As part of the due diligence process, KfW Capital enquires as to whether the venture capital funds have a monitoring, reporting, exclusion and grievance mechanism in place to ensure compliance with human rights in line with international standards (e.g. the UN Universal Declaration of Human Rights). It examines which actions are implemented by the venture capital funds to ensure the well-being of their own workforce, such as preventive health programmes. The funds are also asked to what extent they ensure the well-being of employees working in their portfolio companies through pre-investment checks and subsequent monitoring. KfW Capital's exclusion list also rules out any investments that affect areas owned or claimed by indigenous peoples without the fully documented consent of these peoples. Contracts with venture capital and venture debt funds also include obligations to respect human rights and comply with the ILO standards.

In line with KfW's mandate as promotional bank and the group's role as financier in developing countries, a balance must often be struck between conflicting positive and negative effects. For instance, promoting environmental objectives in the context of existing political and social circumstances is not always possible without regard to social issues such as human rights. Financing and investment decisions are made in line with the established E&S Appraisal described in detail in the "Overarching guidelines" section in the "Environmental information" chapter. According to current information, three cases were identified in 2024 (Indonesia, Tanzania and China [Xinjang]) in which such conflicts between the objective and the needs of the local population had or may have arisen. The case in Indonesia was reported via the established complaints procedure described in the "Complaints management" section of this chapter. In all of these cases, action

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

was taken to investigate the matter and derive remediation options. Due to the cases currently being reviewed, it cannot be definitively confirmed whether there were cases of non-respect of the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work or the OECD Guidelines for Multinational Enterprises involving affected communities in KfW Group's value chain in the financial year.

No severe human rights issues or incidents connected to its value chain in the context of value chain workers were identified at KfW Group. Nor were any cases of non-respect of the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work or the OECD Guidelines for Multinational Enterprises involving value chain workers reported within its value chain.

Processes for engaging with value chain workers and affected communities about impacts

KfW Group endeavours to involve all of its relevant stakeholders in order to avoid adverse impacts and strengthen positive impacts. Engaging with stakeholders at an early stage can help to ensure that any problems, conflicts and overall adverse impacts are recognised at an early stage, resolved and, where appropriate, mitigated from the outset. All stakeholders are involved primarily via the existing grievance mechanism. For detailed information, please refer to the "Complaints management" section of this chapter. Stakeholders are also involved via various dialogue formats at KfW Group as set out in the "Interests and views of stakeholders" section in the "General information" chapter. The relevant formats for value chain workers and affected communities include bilateral talks, the Bonner Frühstücksrunde (Bonn breakfast), Förderdialog (promotional dialogue), information and participatory events, NGO dialogue including the UN Climate Change Conference, project visits as part of project audits and progress checks, and company visits.

Familiarity with the target groups and parties affected is a prerequisite for designing successful KfW Development Bank projects. This involves both identifying the relevant actors and recognising the potential and risks associated with the project's sustainable effectiveness (participation, acceptance, conflicts, etc.), as well as assessing the positive and potentially adverse impacts that the project might have on these groups and making any necessary conceptual adjustments. The scope of the necessary target group and stakeholder analysis depends on the type of project. The decisive factor is whether the project has direct intended impacts on the target group or indirect impacts. The gender analysis reveals gender inequalities, power structures and discriminatory gender norms and can be supplemented to include the content of additional analyses that are also mandatory, such as a target group and stakeholder analysis. Potential for promoting equal opportunities and, where possible, gender-transformative approaches, as well as risks in the context of the project can be identified, adopting an intersectional perspective. Final responsibility for the project documentation and thus also for the gender analysis lies with the portfolio manager, meaning that any gender analysis conducted by external consultants is also approved by the portfolio manager.

DEG reviews compliance with environmental and social standards and the implementation of agreed action plans at existing customers on an annual basis. This includes, in particular, the review of an environmental and social management system and, as a result, the consideration and protection of affected communities by the customer. DEG is assessed externally every year within the framework of the Operating Principles of Impact Management. The assessment examines whether DEG is measuring the impact of its investments on businesses and affected communities adequately.

Actions related to value chain workers and affected communities

KfW Group fulfils its due diligence obligations with regard to value chain workers and affected communities in accordance with the complaints management process. The process is explained in detail in the "Complaints management" section of this chapter.

KfW Group creates and secures jobs in companies and organisations as part of its business activities described in the "KfW Group's value chain" section in the "General information" chapter. This is achieved by providing financial resources to support the economy on a social, economic and environmental level. The financing and promotion provided is designed to support individual projects, companies and public institutions and to create and secure the associated skilled jobs in the interests of sustainable economic development.

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One of the ways in which KfW Group improves the living conditions of affected communities is by financing various environmental projects, such as with respect to environmental and resource conservation, including biodiversity. A detailed description of the promotional programmes as key actions can be found in the "Environment quota" section in the "Environmental information" chapter.

Exclusion lists to avoid adverse impacts on affected communities define areas in which KfW Group does not offer financing for new projects or purposes, such as the use of pesticides, or investments that threaten to destroy or significantly impair areas that are particularly worthy of protection. A detailed description of the exclusion lists can be found in the "Exclusion lists at KfW Group" section in the "Environmental information" chapter.

To ensure the socially responsible financing, also for value chain workers and affected communities, KfW Group applies business area-specific E&S Appraisal procedures. This involves analysing whether projects could result in large-scale resettlement or significant loss of habitat or cultural heritage, and whether indigenous peoples could be affected. If human rights violations come to light after a financed or promoted project has started, remedial actions are taken immediately. The E&S Appraisals are explained in greater detail in the "Overarching guidelines" section in the "Environmental information" chapter. Please refer to the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter with respect to determining the appropriateness of actions and assessing the effectiveness of mitigation measures in the event of negative impacts.

Special requirements and risks must be taken into account when financing projects abroad, particularly in developing and emerging economies. In particular with regard to the protection of affected communities, the group takes additional precautions in its international business to live up to its special responsibility.

The sustainability guidelines of KfW Development Bank, KfW IPEX-Bank and DEG allow for the possibility of an in-depth analysis of human rights issues (Human Rights Impact Assessment) and actions to safeguard compliance with human rights. This option is exercised, in particular, if a project is to be realised in an area in which a critical human rights situation has already arisen or is expected, or if the project is expected to result in conflicts that could have a significant impact on human rights. Exposures with potential adverse impacts on indigenous peoples require their FPIC. In such cases, finding economically viable solutions for appropriate mitigation actions is imperative. For KfW Development Bank and DEG, appropriate mitigation actions are defined by the fact that they are based on the mitigation hierarchy. This means anticipating mitigation actions and avoiding risks and impacts. If avoidance is not an option, the aim is to minimise the extent of the impact or reduce it to an acceptable level. As a result, mitigation actions are aimed at diminishing and minimising the impacts. If significant residual impacts remain despite these endeavours, these are countered with suitable offsets, provided this is technically and financially feasible. If this is not feasible, a review is performed to determine whether the project is worthy of support.

If indigenous peoples are affected by KfW, KfW IPEX-Bank or DEG financing or projects, the conformity of the project must generally be reviewed according to the group's applicable guidelines. If an environmental and social action plan or mitigation actions are defined as part of the E&S Appraisal, the contracts for financing products provide for reporting (monitoring) on compliance with protective actions or the environmental and social action/management plan.

If KfW Group's involvement in affected communities results in a significant loss of livelihoods due to land use, or if people affected by the project have to be resettled involuntarily, a separate Livelihood Restoration Plan, Resettlement (Action) Plan or, where applicable, a Resettlement Policy Framework must be prepared in accordance with World Bank ESS5. This should be available at the time of the project review. If people need to be resettled, a separate final audit is carried out to assess the success of the resettlement process and the extent to which livelihoods have been restored. Resettlement is considered successful if the affected individuals identified in the resettlement plan have received their entitlements (e.g. compensation, new homes, support measures) and their livelihoods have been at least restored or ideally improved.

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The implementation agreements and contracts that KfW Development Bank and DEG conclude with their partners as a binding requirement include the standard obligation for the partners to report any particular incidents, such as serious accidents and other significant incidents, during project implementation in a timely manner and to provide information on remedial action (incident reporting clause). As soon as KfW Development Bank and DEG are notified of specific incidents, these are recorded and tracked. KfW Development Bank employees are informed about the incident disclosure requirements at mandatory E&S Appraisal training sessions. Project partners are given the same information during the contractual negotiations. KfW Development Bank and DEG ensure that all reported incidents are properly documented and processed, and that appropriate action can be taken to remedy the situation and stop it from recurring.

KfW Development Bank has built up a network of environmental and social experts. This network consists of the Competence Centre for Environmental and Social Sustainability, along with environmental and social experts based directly in the operating divisions. The Competence Centre conducts mandatory introductory and refresher training for specific target groups of operational staff on at least a quarterly basis. Optional specialised in-depth training is offered for employees who come into contact with value chain workers and affected communities. The Competence Centre also advises KfW IPEX-Bank's operating units on compliance with its sustainability guideline. Mandatory training providing an introduction to the E&S Appraisal in Financial Cooperation is offered four times a year for new hires, and it is recommended that all employees repeat this training approximately every four years. The aim of this training is to educate participants on, and raise their awareness of, the entire E&S Appraisal process so that they can identify potential adverse environmental and social impacts and involve experts at the relevant points, ensuring that suitable tools to counter these impacts can be developed for the projects concerned. The effectiveness of the approach and the actions taken are reviewed at regular intervals, at least every year when the annual budget is set for the training programme, and adjustments made as necessary.

The Voluntary Ambition Level in Supply Chains (Freiwilliges Ambitionsniveau in Lieferketten – “FALKE”) project was initiated at KfW Development Bank in 2023. The aim of FALKE is to further develop the human rights due diligence approach for KfW Development Bank financing in a targeted manner, even though this is not formally required by the Supply Chain Act. To this end, an analysis was performed of the relevant processes and tools at KfW Development Bank, such as the Environmental and Social Appraisal, along with a peer benchmarking. A package of actions was created based on the analysis, which is to be implemented by 2026 and involves further systematisation of recording human rights risks. Addressing human rights risks in the extended supply chain of projects for essential goods and materials, among others, is to be piloted. Implementation of the planned package of actions will further reduce human rights risks in KfW Development Bank financing activities and this also enables targeted preparations for potential regulatory requirements to be made. Realisation of the FALKE initiative does not require significant operating resources or capital expenditure.

DEG also has its own environmental and social guideline, which is explained in the “Overarching guidelines” section in the “Environmental information” chapter. The E&S Appraisal for every exposure ensures compliance with the social and sustainability standards applied. Action plans for the risks identified in the E&S Appraisal are contractually agreed with the customer to minimise the potential adverse impacts, such as by improving working conditions. Customers are responsible for implementing the agreed actions and reporting annually to DEG on the progress made. In cases involving more complex projects with greater potential for adverse impacts, external monitoring is commissioned or an on-site assessment is carried out by DEG employees. If the customer wishes to make improvements that extend beyond compliance, such as improvements to working conditions, they can obtain additional financing, support and advice from DEG. The agreement or subsequent processing of the action plans by the customer has a positive effect, particularly with regard to the consideration and protection of affected communities in the context of financing. This allows DEG to make an indirect positive contribution in those countries where financing is provided. This impact is measured and managed using DERa, which measures customers’ developmental impact. DEG’s financing has a positive impact in customer regions in the five DERa target dimensions. DERa is explained in detail in the “Value chain workers and affected communities” section of this chapter below. Through its membership of the 2X Challenge, DEG also supports career development and non-discriminatory treatment of women working for its customers. DEG has established a decentralised model comprising experts from the Sustainability division and market multipliers to broaden internal knowledge and firmly embed specialist expertise within the organisation. DEG has also developed in-person and online training for employees on standards, performing assessments and impact measurement.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

As part of the E&S Appraisals performed at KfW Development Bank and DEG, individual actions are introduced for financing partners that do not implement or comply with their own environmental and social requirements, as described in the "Overarching guidelines" section in the "Environmental information" chapter. If financing partners do not implement or comply with the actions imposed, KfW Development Bank and DEG can demand that corrective steps be taken. This may include stopping invoice payment approvals until the relevant requirements have been met. In extreme cases, KfW Development Bank can decide to terminate its contracts with these partners.

KfW Capital's Sustainability Policy requires venture capital funds to take ESG criteria into account in their own due diligence. Extensive checks are performed in this regard and the obligation is set out in the relevant contracts. In addition, KfW Capital enquires as to whether monitoring, reporting and complaints procedures are in place to ensure compliance with international governance standards (e.g. the UN Universal Declaration of Human Rights, ILO standards and the EU General Product Safety Directive) and implementation of these procedures is contractually agreed. If the due diligence process reveals that the venture capital fund does not consider ESG standards in its investments, there are minimum criteria that must be met before an investment can be made. This includes the venture capital fund drawing up an ESG policy, the content of which is coordinated with KfW Capital, specifying which ESG criteria are to be taken into account going forward (potentially tailored to suit the sector and phase of the venture capital fund's investment focus). Due diligence also involves checking whether the venture capital fund has established a whistleblowing mechanism and whether internal compliance procedures are currently in progress or have been completed. The actions serve to protect the employees of the venture capital funds.

Targets related to value chain workers and affected communities

KfW Group's sustainability mission statement requires that risks and negative impacts on social (and environmental) matters be considered as a qualitative target for all financing and promotional projects. An overview of the sustainability mission statement is provided in the "Integrating sustainability matters into the business strategy" section in the "General information" chapter. The group-wide "SDG mapping" target also takes into account SDGs relating to value chain workers and affected communities. The overall target is explained in greater detail in the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter, which lists all SDG contributions.

At individual business sector level, additional quantitative indicators are used in some cases to track policies and actions related to significant positive impacts on affected communities and value chain workers. These are not, however, underpinned by results-based, measurable targets. The additional, quantitative indicators for impact measurement referred to above are described in the sections below. KfW Capital does not have any specific targets for tracking the effectiveness of the policies and actions.

KfW Group's contribution to creating and securing jobs in the value chain through its financing is covered by allocating financing to SDG 8 (Decent work and economic growth) as a sub-item. The mapping of the financing to the SDG is made in accordance with the SDG eligibility methodology described in the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter. As SDG 8 aims to promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all, it addresses a core area of KfW's promotional activities. Within Germany, KfW's programmes aimed at support for SMEs, start-up capital, digitalisation and innovation are particularly relevant in this regard. Outside of Germany, development programmes to strengthen the private and financial sector, as well as large-scale export financing, are mapped to SDG 8.

As part of the impact management project described in the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter, indicators are being developed with respect to workers both within the value chain and beyond (including indirect sector effects). Job-related impacts are measured to determine whether financing contributes directly or indirectly to maintaining or increasing the number of jobs as part of impact management. This indicator was developed as part of the impact category "Creating and securing decent work" and, as all other impact management indicators, is intended to make KfW's financing and promotional activities more transparent. For further information on impact management, refer to the "Expansion of group-wide impact management" section in the "Environmental information" chapter.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

KfW Group can provide information on expected positive contributions related to the consideration and improvement of living conditions, as well as the protection of affected communities and the preservation of local rights, by mapping financing commitments to SDGs 9 (Industry, innovation and infrastructure) and 11 (Sustainable cities and communities). Further information on the SDG eligibility methodology can be found in the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter.

Financing commitments that are mapped to SDG 9 provide information on intended positive impacts in terms of improving living conditions. The group has a broad range of KfW programmes that are aligned with this target, ranging from energy-efficient refurbishment and charging infrastructure for electric cars to the telecommunications sector and financing of innovative start-ups and growth companies. In terms of KfW's activities abroad, financing for the transport and raw materials sectors, among others, also makes key contributions to SDG 9 by promoting industrial processes within the partner countries and securing the basis for industrial production in Germany and Europe. International development financing focuses on expanding sustainable transport infrastructure, in particular on expanding local public transport to improve living conditions for communities.

KfW Group's contribution to SDG 11 includes financing municipal and social enterprises (e.g. kindergartens, water supply, land development), promoting home ownership and environmentally friendly actions for energy-efficient urban rehabilitation, improving energy efficiency in industry and commerce, as well as in the private sector, primarily in Germany. With their commitment to areas including socially inclusive slum rehabilitation, social housing construction, sustainable transport systems and disaster prevention, the group's international activities also make key contributions to SDG 11, facilitating an intended positive contribution to the living conditions and protection of affected communities.

The group endeavours to avoid any negative impacts on the living conditions of affected communities, such as resettlement, that could arise from its co-financed projects. While KfW Group does not collect any overall metrics in this regard, some of its business sectors monitor their impact and the actions implemented with regard to affected communities using the indicators described below.

KfW Development Bank aims to avoid or minimise adverse impacts of co-financed projects as far as possible and monitors the impact it has in this regard. There are plans to evaluate and track significant positive impacts in the future. Proposed KfW Development Bank projects are assessed in terms of their developmental benefits and feasibility, generally on the basis of a feasibility study and an environmental and social sustainability study. Once the project has been completed, KfW Development Bank carries out a final review. The effectiveness of a representative random sample of around 50% of the projects completed is also evaluated ex post by an independent unit. This is intended to promote institutional learning and ensure the continuous improvement of future projects.

KfW Development Bank provides further transparency by disclosing information on effectiveness in the transparency portal. The developmental impact is assessed on the basis of six key criteria agreed by the international donor community in the OECD Development Assistance Committee. This overall assessment reveals at a glance whether a project has been successful or unsuccessful, and how the success is ranked. In the biennial report for the 2021/2022 period, 84% of all of the projects evaluated were classified as successful. The evaluation reports are published in KfW's transparency portal. The key results and findings are also presented in digital format in the "Interactive Database Evaluation and Learning" application, allowing them to be used efficiently and effectively.

DEG's Impact/Climate Commitments are a pledge to increase the contribution its customers make to the economic, social and environmental goals covered by the SDGs, thereby continuously improving the positive impact of its investments at local level. It evaluates its financing activities and the associated developmental impact in relation to factors such as value chain workers and the affected communities using DERa, which was first introduced in 2017. DERa was updated in 2024, validated by Risk Research and relaunched as DERa 2.0. Stakeholders, i.e. value chain workers, were not involved in this update.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

DERa assesses the negative and positive contribution that each customer makes to sustainable development, highlights the changes that have occurred since DEG's investment and illustrates DEG's role in the transformation process. DEG can report on its effectiveness and manage the overall developmental quality of its portfolio based on the DERa evaluation. The DERa comprises two pillars. One maps the impact contribution made by DEG's customers, while the other captures the customer's transformation processes supported by DEG. Five impact categories are used for the purposes of the first pillar to evaluate the development contributions made by each customer: decent jobs, local income, market and sector development, environmental stewardship, and community effects. Each category consists of various impact areas and features indicators that capture a customer's contribution to this category. These indicators are primarily quantitative data or qualitative expert assessments, as well as indicators from international databases, such as the World Bank. Impacts are evaluated in net terms, i.e. impact areas, impact categories and the overall score for this pillar can be negative. This is because the assessment includes both indicators that capture either positive or negative impacts, and indicators that can be both positive and negative. The second pillar considers four approaches that DEG uses to support its customers in their transformation: structuring, closing E&S compliance gaps, promotional measures and impact climate commitment beyond compliance. For these mechanisms, DERa 2.0 documents transformation milestones/targets that DEG agrees with its customers and monitors the progress of implementation. The DERa is applied over the entire project term of each investment. A new DERa must be created for each project before it is approved. It consists of a baseline showing the current values prior to the DEG investment and an ex-ante estimate of the expected effects of the investment over a time horizon of five years. Following approval, the DERa is updated annually by recording the latest values. This enables information to be provided on the customers' developmental impact since DEG's investment. The impacts made by DEG's customers are published every year in DEG's annual Development Report.

In its business strategy, DEG has set itself the target of achieving an annual average DERa portfolio value of 32 points. This target score creates an incentive to enter into socially sustainable financing arrangements. All customers who have a positive cash value at the end of the year and are not classified as defaulted exposures are included in the calculation. DEG achieved an average DERa 2.0 score of approximately 35 with its customers in 2024.

Customers - Consumers and end-users

Policies related to consumers and end-users

In the sense of the value chain described in the "KfW Group's value chain" section in the "General information" chapter, private individuals are customers who either receive financing directly from KfW, such as student loan recipients, or who take out real estate loans, for instance, through the on-lending business. This chapter relates exclusively to KfW's business model, as only KfW – unlike its subsidiaries – provides financing to end-users. As a result, this issue is not relevant across the group. Detailed information on consumers and end-users is provided in the "Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy" section in the "General information" chapter. where the material impacts are also described in further detail.

The promotional priority is to provide non-discriminatory access to financing products for consumers and end-users. Promotional activities include promoting energy efficiency in construction and refurbishment of residential buildings, promoting the purchase and construction of owner-occupied homes, and providing education financing (e.g. student loans and loans for continuing professional development). Article 2 of the KfW Law, the KfW Bylaws and the mandate letters/agreements of the respective ministries form the basis for the legal promotional options open to consumers and end-users.

KfW's "Sustainability guideline for the domestic promotional business" also addresses financing projects for consumers and end-users via the SME Bank & Private Clients business sector, which includes the management of potential adverse impacts or risks related to environmental and social matters. A detailed explanation of the guidelines can be found in the "Overarching guidelines" section in the "Environmental information" chapter. The human rights policy described in the "Social matters at KfW Group" section of this chapter also applies in this regard.

No cases of non-respect of the UN Guiding Principles on Business and Human Rights, the ILO Declaration on Fundamental Principles and Rights at Work or the OECD Guidelines for Multinational Enterprises involving consumers and end-users were reported at KfW in its upstream or downstream value chain in financial year 2024. Nor were any severe human rights issues and incidents connected to its consumers or end-users identified.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

Processes for engaging with consumers and end-users about impacts

Consumers and end-users are involved in particular through measurement of their satisfaction levels. Various direct tools have been put in place to obtain feedback on improving services and to involve customers in the group's activities. Customer satisfaction with the domestic promotional business is assessed in KfW's new customer monitoring. A total of 1,000 sub-borrowers are surveyed every month to yield a representative overview of opinions. Along with the external evaluations of the promotional programmes, their feedback provides valuable information on how KfW products, processes and services can be more closely aligned with market requirements.

KfW also calculates the net promoter score ("NPS"), which measures customer feedback on all housing-related promotional programmes and indicates how likely customers are to recommend KfW to others. NPS uses a scale of 0 to 10 and is calculated by subtracting the percentage of detractors (dissatisfied customers) from the percentage of promoters (loyal and enthusiastic customers). A high NPS indicates that customers see KfW in a positive light and are more likely to recommend KfW to others.

Consumers and end-users are also involved via information and feedback sessions with financing partners and bank associations as described in the "Interests and views of stakeholders" section in the "General information" chapter.

Actions related to consumers and end-users

Consumers and end-users are addressed via promotional programmes, most of which are on-lent loans through banks. The product requirements are defined either by the commissioning ministries in close consultation with KfW (federal programmes) or by KfW working closely with the commissioning ministries (KfW's own programmes/ERP programmes). Within the target groups addressed, the products are open equally to all eligible applicants in line with the product terms and conditions.

One of the ways in which KfW makes a positive contribution for consumers and end-users is by offering various financing solutions to meet the needs of people in school-based and higher education, and people undergoing further professional development. The education financing programmes improve access to education, particularly for financially disadvantaged consumers and end-users, allowing KfW to help to promote equal opportunities. KfW also promotes the purchase and construction of owner-occupied residential property, thereby supporting housing security. Please refer to the "Environmental and Social Appraisal Guidelines" section in the "Environmental information" chapter with respect to determining the appropriateness of actions and assessing the effectiveness of mitigation measures in the event of negative impacts on consumers and end-users.

KfW grants education financing directly to the end customer in the form of a loan. KfW currently offers three promotional products related to education. The KfW Student Loan is used to finance a student's living expenses during an undergraduate/graduate degree or doctorate. This is KfW's own programme, meaning that it is offered without the use of state funds and at KfW's own risk. The KfW Student Loan is offered across the board to almost all students at state or state-recognised higher education institutions in Germany, with no major restrictions apart from age-related restrictions. The Education Loan is a promotional product for vocational trainees and students in the last two years of their training or studies. It is granted by KfW on behalf of the Federal Ministry of Education and Research ("BMBF") in cooperation with the Federal Office of Administration (Bundesverwaltungsamt). It provides support in the final stage of vocational and higher education to enable the recipients to concentrate on obtaining their qualifications. The product details are governed by the relevant promotional requirements of the Federal Office of Administration. The funding programme under the Upgrading Training Assistance Act ("Aufstiegs-BAföG"), which is implemented on behalf of the BMBF, is used for further professional development. The promotional terms are set out in the Aufstiegs-BAföG. The funding provided under the Aufstiegs-BAföG consists of a grant and an optional loan component, which are designed to cover not only living expenses but also the costs of resources and examinations, among other things. KfW handles the optional loan component of the Aufstiegs-BAföG programme only. The application and approval process is the responsibility of the further professional development offices in the federal states. The promotional business volume for the three education financing products totalled EUR 172 million in 2024.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

Article 2 (1c) of the KfW Law states that KfW's mandate includes implementing promotional measures on behalf of the state, in particular concerning housing. To finance owner-occupied housing, KfW grants loans to private individuals, both with and without energy efficiency conditions, thereby promoting housing security. For more information on housing-related promotional products for private individuals with energy efficiency conditions, please refer to the "Environment quota" section in the "Environmental information" chapter. For the purchase of owner-occupied property, KfW offers private individuals the Home Ownership programme, which can be used to finance the purchase or construction of owner-occupied property, including ancillary building costs. The promotional loan is granted via the bank on-lending system; KfW does not make use of any state funds with regard to the financing conditions. KfW also offers private individuals the promotion of cooperative housing with a loan that can be used to purchase shares in housing cooperatives for a member-occupied housing cooperative flat in Germany. In 2024, the promotional business volume for products to promote housing security totalled EUR 2,354 million.

KfW's key actions for consumers and end-users in 2024

Promotional product	Target group	Promotional business volume EUR in millions
Home Ownership programme: loan to purchase or build a home	Private individuals who buy or build a residential property for their own use	5,266
KfW Student Loan: financing of undergraduate/graduate degrees and doctorates; KfW's own programme	Students aged 18 and over studying at a state or state-recognised higher education institution based in Germany	244
Funding under the Upgrading Training Assistance Act: loan and grant for further professional development; programme mandated by the Federal Government	Individuals who have completed a recognised vocational training programme	125
Promotion of cooperative housing: loan to purchase shares in housing cooperatives to be used for member-occupied housing	Private individuals who wish to acquire shares in housing cooperatives for member-occupied housing	25
Educational Loan: financial support in the final years of education/training; programme mandated by the Federal Government	Full-time vocational trainee or student aged 18 to 35	13

KfW is committed to providing non-discriminatory access to promotional products. With this goal in mind, another action is to ensure that KfW's website is accessible. In recent years, the main focus has been on the accessibility of portable document formats ("PDFs") and forms on KfW's portals. KfW bases this on the requirements of the German Ordinance on Accessible Information Technology (Barrierefreie-Informations-technik-Verordnung – "BITV"). The legally required accessibility statement is updated on a regular basis, at least once a year.

Various activities are used to review and monitor accessibility measures:

Comprehensive BITV audit of the kfw.de website from July 2024
Plans for continual testing until at least 2025
BITV monitoring via a special project management tool (BITV-Jira) for task visualisation and documentation using the Confluence software
Proactive internal and external audits during the year

Targets related to consumers and end-users

In its domestic promotional business, KfW uses KfW new customer monitoring to identify and implement optimisation potential related to customers, and in doing so monitor the effectiveness of actions taken with respect to private customers. Approximately 1,000 borrowers and grant recipients are surveyed every month to gain a representative overview of opinions. The aim is to systematically monitor and measure customer satisfaction over time and to analyse current developments in detail so that KfW can implement control measures at an early stage, and measure the impact of any measures taken, in cases where the target of

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

75% is not met. The 2024 Sustainability Programme set the target of developing approaches to improve customer satisfaction. Customer satisfaction in Germany has been surveyed and analysed to this end since 1 January 2017. KfW's ambition level is between 75% and 80% (top 2 values), depending on the analysis. The overall satisfaction indicator is used to measure customer satisfaction. The survey is based on the question "How satisfied are you with KfW's services overall?" on a 5-point scale and presentation of the top 2 values (proportion of customers answering "Completely satisfied" or "Very satisfied"). The "customer satisfaction" KPI is calculated as a simple average of the weighted average scores for commercial and private customers. Once the survey responses have been collected, the market research institute commissioned by KfW carries out statistical analyses of the anonymised data. Employees from Group Development and Economics as well as Domestic Marketing and Digital Channels were involved in setting the target. They used results from the preceding years and the national "Kundenmonitor Deutschland" survey and determined an ambitious target corridor. KfW new customer monitoring provides important insights for KfW's strategic objectives 2029 and is incorporated into the user-centric (further) development of products, processes and services. The group calculates this indicator on a monthly basis using representative samples in the main domestic programmes for commercial and private customers (residential construction and student loans/education). The latest KfW new customer monitoring value as of 31 December 2024 is 66.1%. Based on the customer feedback from KfW new customer monitoring the main reasons for falling short of the target were the volatile environment for KfW's promotional products in terms of interest rates, availability of funds and financing conditions. These primarily reflect the marked change in external circumstances beyond KfW's control (such as federal budget developments, higher market interest rates, increased sustainability requirements). KfW is in constant specialist dialogue with its clients in order to optimise the financing conditions to be more customer friendly.

KfW Group's sustainability mission statement refers to supporting achievement of the 2030 Agenda with the SDGs. Education financing products contribute to the fulfilment of SDG 4 "Quality education" by promoting equal access to education. The housing-related products generally contribute to SDGs 7, 11 and 13. The products for financing home ownership that are not linked to energy-efficiency conditions contribute to the fulfilment of SDG 11 "Make cities and human settlements inclusive, safe, resilient and sustainable" by helping to secure housing. More detailed information can be found in the "SDG mapping of KfW's financing activities" section in the "Environmental information" chapter.

Customers - Corporates

Corporate customers have been identified as an additional company-specific material topic due to the particular nature of KfW Group's business model. They are taken into account due to the positive material impacts in terms of improving access to the products offered. Due to their size, SMEs are at a structural disadvantage compared to other companies when it comes to raising capital. This can be explained by asymmetrical distribution of information between companies and investors, which is exacerbated by a lack of credit history. As a result, it is difficult, or very expensive, for investors to assess companies' creditworthiness and the success potential of the projects to be financed. Demand also tends to be for smaller financing volumes. Overall, this can translate into a smaller or more expensive supply of capital, which equates to more difficult access to financing. With its specific credit lines for SMEs, DEG supports access for these companies via bank financing. SMEs in developing and emerging economies face particular obstacles in accessing long-term financing.

In order to improve access to financing products for SMEs, KfW Group also offers financing options for this customer group, as already explained in the "Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy" section in the "General information" chapter. Due to the business model provided for in the KfW Law (on-lending principle), KfW Group relies on SMEs gaining access to its promotional products via their regular banks. To ensure this, the group provides its financing partners with product information and marketing material and offers a contractually agreed monetary incentive for each financing agreement that is concluded. KfW Group endeavours to ensure that SMEs have access to information and resources, in particular by having advisors in its Infocenter answer questions on the individual promotional products and help companies find the right product to suit their individual needs. The advisors are trained to provide detailed advice on the product requirements and conditions, and to support companies during the application process. KfW promotional loans are characterised by more favourable interest rates than standard market rates, as well as long terms and fixed interest rate periods and, where applicable, the use of repayment bonuses. To facilitate access to lending, KfW also enables the on-lending banks the to assume part of the SME's default risk as a risk partner in selected programmes (e.g. start-up financing).

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

In order to track the improvement in access to financing products for SMEs, the two key metrics described below provide a good overall impression of the impact achieved. One aim of KfW Group's strategic objectives 2029 is to provide financing for the German SME sector with the commitment volume for domestic promotional business products classified as "relevant to the SME sector" accounting for over 40% of total commitment volume in Germany. The SME share of financing at group level was 35% in 2024, which was below the target of the strategic objectives. Promotional opportunities were limited in view of the high EU reference rate due state-aid legislation, which resulted in lower new business volume in corporate environmental financing for the business sector SME Bank & Private Clients (Renewable Energy – Standard and Climate action campaign for SMEs) and in the SME-relevant products of the business sector Customised Finance & Public Clients (primarily Investment Loans for Municipal and Social Enterprises, and the global loan for lease finance). In addition, higher new business volume in private housing financing (Climate-friendly Construction and Federal Funding for Efficient Buildings) resulted in a smaller share of SME promotion in the total promotional volume and thus to a smaller SME share of financing. The table below provides an overview of the contributions made by KfW Group's business sectors to the SME share of financing.

Commitments made by the business sectors in relation to the strategic area of German SMEs¹)

Promotional area	2024
	EUR in billions	%
SME Bank & Private Clients	13.4	37
Customised Finance & Public Clients	1.0	2
KfW Capital	1.6	100
Total commitments	16.0	35²

¹) The table shows the commitment volume of the business sectors classified as "relevant to the SME sector".
The figure has not been adjusted for commitments "relevant to the SME sector" which were made outside Germany.
²) Adjustment for non-recurring effect from emergency aid and price cap for gas and heat on behalf of the Federal Government, special funding measures (including margining and gas storage facilities) and the hydrogen core network amortisation account

Furthermore, the improvement in customer satisfaction is measured via the KfW new customer monitoring programme. The group calculates this indicator monthly in its main domestic programmes using representative samples. The calculation of the indicator is explained in greater detail in the "Customers – Consumers and end-users" section of this chapter.

Any complaints about promotional products and financing are received by the Infocenter, the specialist divisions responsible for processing them and the complaints management team. The group-wide complaints management team is responsible for performing a structured evaluation of critical feedback and complaints. The process is explained in detail in the "Group-wide complaints management in banking business" section of this chapter.

Complaints management

KfW Group has established grievance mechanisms and channels that are available to all stakeholders to ensure that the policies, actions and targets of KfW Group described above are implemented and monitored effectively, and that human rights, particularly with regard to the Code of Conduct and the human rights policy, are respected. Each subsidiary of KfW Group also has its own grievance mechanism. In order to follow up on potential fields of action raised and ensure that the channels are effective, KfW Group focuses on an appropriate risk culture that emphasises a responsible, competent approach to risk and a healthy culture of error. The aspects of the risk culture set out in the Code of Conduct provide guidance in this regard (see the "Social matters at KfW Group" section in the "Social information" chapter). The risk culture is monitored centrally using the risk culture index tool, which is calculated every two years as part of the employee survey. After each employee survey, an action group identifies focus areas in which actions are defined to continuously improve the risk culture.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Social information

KfW Group's grievance mechanisms

The group has established procedures to respond to complaints and reports of potential human rights-related and environmental risks, and to react appropriately to any of its own breaches of duty. KfW Group's grievance mechanisms are based on the Policy statement of KfW and its subsidiaries' on human rights and on its human rights strategy, which is explained in further detail in the "Social matters at KfW Group" section of this chapter. Complainants can lodge complaints or raise human rights and environmental issues with KfW Group using the channels described below. All standard communication channels can be used: verbal, written, e-mail and the established online complaint forms; issues can also be raised in person with the ombudsperson. Complaints relating to the banking business can be addressed directly to the business sector concerned. Employees and third parties can also opt to report potential criminal offences (including failure to comply with the law) anonymously to KfW's compliance whistleblowing system.

Ombudsperson

The group has appointed a lawyer from an external law firm to act as its ombudsperson. The ombudsperson serves as an external point of contact for the KfW Group workforce and third parties who wish to report potential compliance violations and suspected criminal offences. At the core of the ombudsperson system lies the principle that whistleblowers can contact the ombudsperson confidentially if they have reason to suspect criminal offences or potential violations of the law. This encompasses all types of corruption, bribery, fraud, money laundering and similar irregularities, as well as breaches of the German Banking Act and the LkSG. This whistleblowing system allows KfW Group to investigate any such irregularities systematically.

The ombudsperson independently and autonomously investigates the reports received to determine how relevant they are to the company. If the conclusion is that KfW and/or a KfW Group company could be affected, the ombudsperson passes on the matter to the Compliance department of the group company concerned without disclosing the whistleblower's identity. The Compliance department then follows a due and proper procedure to evaluate the case before coordinating and implementing the necessary action. If the evidence points to criminal conduct, the company takes further (e.g. legal) steps on a case-by-case basis. Each group company has its own compliance organisation. Compliance violations are generally handled by the various compliance units within the group. If individual cases cannot be assigned to a specific group company, KfW Compliance acts as the overarching compliance function.

When complaints and reports of violations are processed, the complaint offices and KfW Group's independent Compliance function ensure compliance with the principles of impartiality, objectivity and confidentiality. Information on protection for whistleblowers is explained in greater detail in the "Strategies relating to aspects of business conduct policies" section in the "Governance information" chapter. Information on the whistleblowing system is available in various languages and can be found on the group website along with contact details. Consumers and end-users are informed of the availability of the whistleblowing system by the Infocenter, or are referred to it when submitting a complaint. There is no standard means of ascertaining whether value chain workers, consumers and end-users are aware of and trust these structures or processes as a way to raise their concerns or needs and have them addressed.

KfW's LkSG complaints procedure

The statutory minimum requirements set out in the LkSG currently relate to procurement and KfW's banking operations. The KfW Executive Board has commissioned the Compliance department to implement a central evidence unit to monitor the obligations arising from the LkSG. The Compliance department has established a governance structure related to the LkSG with corresponding responsibilities and set these out in a group-wide policy. It monitors risks related to the Act, compliance with appropriate due diligence obligations and takes on general tasks such as documentation, reporting and training of the employees concerned. The KfW Executive Board has overall responsibility for compliance with the LkSG within KfW Group. The group's grievance mechanisms were reviewed as part of the implementation of the LkSG and adapted to meet the requirements set out therein. In particular, all environmental and human rights-related grievances received are reported to the central evidence unit and thereby included in the group-wide risk assessment. The whistleblowing system meets the requirements set out in the LkSG and protects all whistleblowers from retaliation. Handling of complaints is governed by the group-wide "LkSG complaints procedure". Once a complaint or report has been received, it is assessed to determine whether it relates to potential human rights violations or environmental issues. Receipt of the report is documented within the company. The whistleblower or complainant should receive confirmation of receipt within a maximum of seven calendar

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days. Complaints and reports are passed on to the competent unit for further processing. This unit is responsible for processing and clarifying the facts of the case. If possible and necessary, the matter is discussed with the whistleblower or the complainant in order to better understand the facts and the action to be taken. The whistleblower or the complainant is informed of the result in writing. Feedback should be provided within three months. If it takes more than three months to investigate the matter, the whistleblower or complainant is informed accordingly. For those activities covered by the LkSG, this means that a review of the effectiveness of the actions implemented to comply with the due diligence obligations is carried out at least annually or on an ad hoc basis. In this respect, the central evidence unit acts not only as a regulator, but also as an advisor to the specialist departments, and is also responsible for monitoring risk management, including the development of safeguards and control measures. The effectiveness of the complaints procedure is reviewed at least once a year and on an ad hoc basis. In 2024, the review did not reveal any findings.

KfW's central evidence unit, which is part of the Compliance department, is informed when complaints are processed. In cases involving complaints related to human rights and environmental risks or breaches of duty, it develops remedial actions and adapts existing preventive measures (if necessary). The central evidence unit is to be informed about the outcome of the processing of complaints and reports related to the LkSG, and of any actions introduced or adapted.

The German Minimum Requirements for Risk Management ("MaRisk") that apply to the compliance function provide protection against being penalised or disadvantaged as a result of lodging a complaint. The compliance function shall ensure the implementation of effective procedures for complying with the legal rules and regulations that are material to the group, and of corresponding controls. The appropriateness and effectiveness of the complaints procedure is monitored annually and on an ad hoc basis. If a report or complaint related to the LkSG is not received by the Compliance department, but by another department within the group, it is forwarded to the responsible Compliance department.

The LkSG complaints procedure was communicated to employees for the first time during LkSG information campaigns on the intranet. The communication of the procedure was intended to ensure that all employees are aware of the options for reporting human rights-related and environmental risks and violations, and that the procedure can be used effectively. In addition, KfW Group organises a group-wide training session on the LkSG every two years, with relevant departments being provided with information on the main content and regulatory purpose of the Act. The training aims to raise sufficient awareness of human rights-related and environmental risks. Training and awareness-raising actions help to draw employees' attention to these issues so that any violations that are impending or have already occurred can be recognised and reported at an early stage. The training is mandatory for employees and their attendance is documented. The training is intended to enable employees to identify potential risks and violations at an early stage and act accordingly.

Complaints channels for employees

In addition to the overarching channels already described, group employees can approach their managers with concerns and complaints at any time. Employees in Germany also have the option of contacting their company's workers' representatives and their HR partners. Various channels have been set up at KfW and its subsidiaries to reflect the different statutory requirements. Complaints are passed on to the relevant division if they have been raised elsewhere.

Employees of KfW in Germany who feel discriminated against on grounds related to the German General Act on Equal Treatment (Allgemeines Gleichbehandlungsgesetz – "AGG"), i.e. due to their race, ethnic origin, gender, religion or beliefs, disability, age or sexual identity), can contact the AGG Complaints Office. The right of complaint pursuant to Section 13 AGG grants the employees of a company a comprehensive right to lodge a complaint with respect to discrimination. The employer is responsible for the specific structure of the complaints procedure and the complaints office to be established. The AGG Complaints Office is legitimised by the AGG by ensuring appropriate accountability for fair conduct and strengthening employee trust. The information is published on KfW's intranet and there is mandatory training on the AGG every three years for all employees of KfW, KfW IPEX-Bank and DEG in Germany. There are no defined procedures for case processing, as all cases differ. Any findings resulting from the individual complaints are forwarded to the parties responsible. The complainant decides whether the information is to be passed on and is involved in any decisions on action to be taken. DEG, KfW IPEX-Bank and KfW Capital also have their own AGG complaints offices. A total of two cases of discrimination were reported at KfW Group in reporting

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year 2024. Both cases were closed in the reporting year without any monetary obligations for the group. Submitted cases are generally documented and analysed by HR and handled in collaboration with the individuals or departments responsible. In cases of conflict, external contact points are available through social counsellors and an external psychosocial hotline. The Staff Council, Works Council, equal opportunities officers and representatives for disabled employees are available as contact persons, who are listed on the intranet with a telephone number and e-mail address and they also offer open consultation sessions. The employer's representative for matters relating to staff with severe disabilities is the main point of contact person for inclusion at KfW.

Employees in Germany also have the right to submit any suggestions or complaints to the workers' representatives responsible for them at KfW, KfW IPEX-Bank and DEG. At KfW, the equal opportunities officer is the point of contact for any complaints regarding discrimination based on gender, especially discrimination against women. The workers' representatives advise those affected and represent their interests towards KfW and its subsidiaries. They provide regular information on these matters on the intranet, in circulars and at staff and works meetings.

The legal basis for the activities of KfW's Staff Council in Germany is the German Federal Personnel Representation Act (Bundespersonalvertretungsgesetz - "BPersVG"). The Staff Council is responsible for proposing actions that allow employees to ensure compliance with the relevant laws, to receive and pass on suggestions and complaints, and to ensure that these issues are addressed by KfW. All workers' representative bodies have their own intranet page providing the names of the relevant contacts and the times of their consultation sessions. The Executive Board and the Head of HR meet with the staff representatives on a monthly basis. In accordance with Section 80 BetrVG, the situation at KfW IPEX-Bank and DEG is comparable. The tasks of the Works Council are set out in the BetrVG and include monitoring compliance with the law, receiving and forwarding suggestions from employees and ensuring that they are addressed by KfW IPEX-Bank and DEG, and promoting gender equality. In order to fulfil these tasks, the Works Council must receive full and timely information from the employer. To this end, weekly meetings are held with HR and regular monthly meetings with the management. Depending on the participation rights of the Staff Council/Works Council, various processes are in place to ensure and operationalise compliance with these rights. KfW, KfW IPEX-Bank and DEG focus on dialogue with complainants in order to reach amicable solutions.

Group-wide complaints management in the banking business

Grievance mechanisms are in place throughout the group; they are tailored to the individual business sectors and types of complaints. The group uses incoming complaints regarding products and services as a vital customer feedback tool to optimise processes and services. This approach is based on the BaFin minimum requirements for complaints management. KfW Group's goal is also to avoid human rights breaches as far as possible using established processes and preventive measures. The aim is to give anyone who feels negatively affected by KfW Group's projects the opportunity to lodge a complaint. The complaints procedure in place at KfW and its subsidiaries is set up in accordance with the UN Guiding Principles on Business and Human Rights.

KfW's grievance mechanism is described on its website. Complaints can be lodged by telephone, post or by sending an e-mail to a complaints mailbox. Each complaint is processed and answered with the involvement of the relevant departments of KfW. The principles for complaints handling include informing complainants of the opportunities available for arbitration and out-of-court dispute resolution. For affected communities, the project-related grievance mechanism provided by the respective local partners is to be used. KfW Group sees improving accessibility also for vulnerable groups as part of its tasks. Complaints are evaluated quarterly and reported in the form of key findings to the Executive Board. If the analysis reveals recurring fields of action, these should be addressed in a targeted manner. To this end, the causes of complaints are identified, and possible solutions are developed together with all departments involved in order to make the group's service and performance even more customer-friendly. Customer enquiries are answered by the specialist division or the complaints management team. As regards value chain workers, it is not standard procedure with respect to financing to refer employees of financed companies or on-lending banks to grievance mechanisms of the financing bank.

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The Compliance department at KfW is an independent organisational unit. Complaints are always assessed for relevance to compliance issues and are processed by the relevant divisions. If a complaint involves an indication of a criminal offence, Compliance is responsible for processing and handling the complaint.

KfW Development Bank's grievance mechanism is designed to give anyone who feels directly negatively affected by the impact of a project supported by KfW Development Bank, either now or in the future, the opportunity to raise complaints. These can be submitted by e-mail or using an online form, as well as via KfW Development Bank's central complaint office. Complaints can also be submitted to one of KfW Development Bank's foreign branch offices or to the responsible project manager directly. All complaints are processed regardless of the channel used to submit them. Contact details, admissibility criteria and further information on the mechanism, as well as the complaint reports, are published on the website. A complaint does not have to be lodged in any particular form, but the complainant must be actually or potentially affected or an authorised representative of such person.

In accordance with the applicable environmental and social standards (in particular World Bank Environmental and Social Standard 10), all KfW Development Bank projects must set up a local grievance mechanism as a point of contact for affected communities, for example. This also applies to financial intermediaries. As a result, KfW Development Bank requires the project developers to inform and consult affected communities about the project as part of the E&S Appraisal, using information that is easy to understand, and to address suggestions and concerns related to the project design and implementation where possible. In accordance with World Bank Environmental and Social Standard 2, it is mandatory for the projects to also have their own grievance mechanism for workers. Complainants can also contact the KfW Development Bank complaint office to report any actual or potential violations of environmental and social standards, including human rights violations. Incoming complaints are assessed to ensure they are valid before being registered. Following a preliminary review, which involves collecting information on the background to the complaint, an attempt is made to work towards remedial action in tandem with the complainant and other stakeholders. If agreed action cannot be taken immediately or a remedial solution is unsuccessful, the complainant will be provided with information on alternative means of addressing their concerns. KfW Development Bank's grievance mechanism evaluates valid complaints and determines whether there are systematic fields of action, with the aim of analysing internal processes and procedures and making any necessary adjustments to avoid similar complaints in future. The planned Guidelines & Procedures of KfW Development Bank's complaints management include a clause on retaliation. The idea is for KfW Development Bank to undertake to implement actions to prevent and counteract possible retaliation against complainants and other individuals involved in a complaint. Developing grievance mechanisms, for both employees of projects and the third parties affected by the projects, is an integral component of the environmental and social standards applicable to KfW Development Bank in its financing activities. As such, they are also part of the regular reporting obligation and the object of periodic reviews by KfW or the experts it appoints. The specific subject and scope of the review depend on the case at hand, but generally also include a survey of the relevant target groups on their experience in dealing with the mechanisms in question. If room for improvement is determined, there are various potential measures available to improve the accessibility of the mechanisms, including targeted training for stakeholders and awareness-raising campaigns.

At KfW IPEX-Bank, complaints can be submitted using an e-mail address and a form on the website in addition to the group-wide complaints channels. This compliance channel for regulatory matters is responsible for complaints relating to investment advice, lending and other services provided by KfW IPEX-Bank, and serves as the complaints management mechanism in accordance with the requirements imposed by BaFin and the German Securities Trading Act (Wertpapierhandelsgesetz). Confirmation receipt of the complaint is sent along with an indication of the expected processing time, which generally does not exceed two weeks. The central complaint office then coordinates clarification of the matter, involving all the necessary areas of the organisation. Information on the complainant can be submitted in anonymised form. The sustainability officer and the press inquiries channel within Group Communications are responsible for complaints and concerns relating to sustainability, environmental and social issues.

KfW IPEX-Bank's Sustainability Guideline requires each borrower to set up a procedure through which complaints by employees and affected members of the public are received and handled in an appropriate way. Cases and processing results are documented and included in reports. For example, training may be provided on a case-specific basis.

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DEG's grievance mechanism can be used by any person who believes they have been adversely affected by a project co-financed by DEG. Complaints to DEG must be submitted in writing. This can be done online using a complaint form, by e-mail or by post. The DEG complaint office is independent of the company's operational activities and of the areas responsible for the activities relating to the complaint. It can be accessed via the DEG website. The process is described in German and English with information provided on the relevant procedures and schedules. The complaints procedure involves an independent body, the Independent Expert Panel ("IEP"), which is supported by a complaint office at DEG. Any complaints received are passed on to the IEP. This external body consisting of three independent international experts is designed to ensure appropriate accountability for fair conduct and to strengthen stakeholder trust. If the complaint does not fulfil the relevant criteria, the complainant is notified and informed of the reasons for the rejection. The panel recommends alternative procedures for complaints that are rejected.

In valid cases, the IEP decides whether to initiate arbitration or a compliance review. DEG's complaint office is staffed by DEG employees who record incoming complaints, confirm receipt, coordinate appropriate implementation of the grievance mechanism, and support the panel in practical matters. DEG established this mechanism in 2014 with a Dutch development finance institution. DEG informs the parties concerned if efforts to reach a satisfactory solution are hampered by the principle of confidentiality.

The IEP may use an additional investigation method depending on the nature of the complaint. Stakeholders must be provided with appropriate access to sources of information, advice and expertise, and the panel is responsible for monitoring any agreed action. The IEP ensures conformity with DEG's guidelines, in particular the DEG Guideline for environmental and social sustainability, the group's sustainability mission statement, the group's human rights policy and the exclusion list. The DEG grievance mechanism has its own policy that explains the protection offered against retaliation. In this context, the requirements of the EU Whistleblowing Directive are relevant to compliance. No training or reviews are provided beyond provision of the grievance mechanism in connection with DEG business.

KfW Capital's central complaints management team coordinates the clarification of concerns. Complaints can be submitted by post or online via a central e-mail inbox. Information on the complainant can be submitted in anonymised form. Complaints that are potentially relevant to the LkSG are processed in the same way as other incoming complaints and are passed on to KfW Capital's Compliance function. Complaints and reports relating to KfW Capital that are received via the group companies' complaints channels are passed on by KfW's Compliance division to KfW Capital's Compliance function for further processing. As part of its due diligence, KfW Capital also verifies whether the venture capital funds have established a whistleblowing mechanism that can be used by employees of the venture capital funds, and whether internal compliance procedures are currently underway or have been completed in the past. This also serves to protect the employees of the venture capital funds. The whistleblowing unit can also, however, be set up to be used by externals, for instance by employees of the portfolio companies.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Governance information

Governance information

Compliance strategies at KfW Group

Promoting and further developing the corporate culture

KfW Group's Code of Conduct is at the centre of promotional activities and an expression of corporate culture. It sets out the specifics of the group's values, such as strengthening collaboration, expanding risk culture, promoting diversity, leading effectively and developing skills. For a detailed description of the Code of Conduct, please refer to the "Social matters at KfW Group" section in the "Social information" chapter. Accordingly, KfW Group expects its employees to act ethically and with integrity. In addition, it expects its employees to "take responsibility" in order to maintain this corporate culture.

The foundation of KfW Group's corporate culture is compliance with all relevant statutory, regulatory and internal requirements. This includes requirements on combating corruption and fraud, preventing money laundering and financing of terrorism, compliance with financial sanctions and embargoes, and on securities and tax compliance, data protection and risk management. Compliance with statutory and regulatory requirements is also an element of the group-wide Code of Conduct and the values to which all employees are committed. The guidelines on anti-corruption and anti-bribery are in line with the United Nations Convention, the statutory requirements and German legal and regulatory requirements. The procedures for protecting whistleblowers comply with Directive (EU) 2019/1937 and the German Whistleblower Protection Act (Hinweisgeberschutzgesetz – "HinSchG"). Safeguards for the prevention of criminal acts are created and documented in accordance with Section 25h KWG. The implementation of all integrity and compliance guidelines is described by group-wide compliance guidelines, which are supplemented and further elaborated by additional, company-specific policies and work instructions. The prevention of corruption and other criminal acts is also an ongoing objective in KfW Group's sustainability programme as part of the corporate culture. In addition, KfW Group is committed to fighting corruption as a corporate member of Transparency International and, represented by DEG, is a supporting company of the Extractive Industries Transparency Initiative. It cooperates with partners including the Federal Ministry for Economic Cooperation and Development (Bundesministerium für wirtschaftliche Zusammenarbeit und Entwicklung – "BMZ") in implementing the corruption prevention and integrity strategy in German development policy. KfW Group applies the quality criteria required by the BMZ of all implementing entities for the implementation of this strategy in its international financing activities. The applicable rules of conduct are based on the German Federal Government's anti-corruption requirements and also on the existing rules of large German commercial and promotional banks.

As part of the "Cultural journey" project launched in January 2024, KfW Group is working on promoting and developing its corporate culture. The aim of the project is for the corporate culture to support the implementation of KfW Group's strategic agenda to an even greater degree. The refinement of KfW Group's cultural identity this calls for is realised with the involvement of employees and on the basis of the strengths and weaknesses of the current corporate culture. The targets include transforming the bank to meet the dynamic challenges of our time and continuing to position KfW Group as an attractive employer. For further information on KfW Group's efforts to increase its attractiveness as an employer, please refer to the "Employer positioning" project in the "Social matters in banking operations" section in the "Social information" chapter. The project is coordinated by the Human Resources and Corporate Development departments and, in the design stage, included workshops for employees at various levels, where action areas for a new cultural direction were developed. Workshops with Executive Board members, managing directors and heads of department were then used to define a target culture and plan actions. This year's KfW management conference kicked off the implementation stage, in which all departments are working on their contribution to the target culture.

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Financial Report > Combined non-financial report > Governance information

Strategies relating to aspects of business conduct policies

The prevention of criminal acts and compliance with the Code of Conduct are the collective responsibility of KfW Group. The KfW Executive Board bears overall responsibility for compliance within KfW Group. In addition, the managing directors of the respective subsidiaries and their compliance organisations are responsible for compliance with and implementation of binding regulations. The Executive Board has delegated various areas of responsibility to the Compliance department, including the responsibility for group compliance. This includes defining preventive measures and conducting investigations in the event of loss. Preventive measures include introducing additional controls and expanding existing controls on business initiation and/or the realisation of projects (e.g. prior to disbursements).

The Compliance department operates independently of other departments and aligns the existing compliance management system with changing laws and market trends. In accordance with the Minimum Requirements for Risk Management ("MaRisk"), Compliance is the central area responsible for recognising legally relevant developments at an early stage, preparing decisions in the responsible bodies and applying a monitoring process to ensure that all legal requirements are met. KfW's Compliance department concentrates on matters such as the prevention of criminal acts, money laundering and the financing of terrorism, compliance with financial sanctions and embargoes, securities compliance, tax compliance, data protection and compliance with MaRisk. The fraud officer coordinates the actions to prevent criminal acts and, like the money laundering officer, the securities compliance officer and the data protection officer, is assigned to the Compliance department. There are guidelines applicable throughout the group on prevention of criminal offences and handling gifts and invitations. The Legal Affairs department advises the Compliance department on legal matters, such as on searches and seizures.

KfW Group's Code of Conduct is directed at all employees, managers, members of the KfW Executive Board and the managing directors of the subsidiaries. In addition, the KfW Executive Board and the management boards of the subsidiaries have their own codes of conduct, in which their obligations to the respective boards of supervisory directors/supervisory boards are mentioned separately.

KfW Group has introduced various measures for reporting and following up on suspected incidents. All KfW Group employees and external persons have the opportunity to report information on possible unlawful behaviour (in particular criminal acts) in connection with KfW Group's business activities to the fraud officer or the trusted third party (ombudsperson). For a detailed description of the role and tasks of the ombudsperson, information on the whistleblowing system and, in addition, information on internal and external complaints management, see the "Complaints management" section in the "Social information" chapter.

The fraud officer inventories and processes all suspected incidents. Losses are recorded in a loss database belonging to the Risk Controlling department. It coordinates business decisions (e.g. involvement of internal and external persons and/or organisations), prepares a risk analysis and monitors compliance with rules and coordination of investigations. The fraud officer is authorised to issue instructions for the performance of the officer's institution-specific responsibilities and, in exceptional cases, can convene a fraud task force that consists of the relevant divisions and organisational units and jointly decides on further action. Suspected incidents in which employees are involved with a loss potential of EUR 1 million or with the potential for material reputational damage are deemed exceptional cases. The fraud officer informs the Executive Board about the processing of the suspected incidents. Internal Auditing then audits compliance with the correct procedure.

A review of adherence to the implementation of compliance requirements is carried out in the annual audit of the consolidated financial statements. The auditor sends the audit report to BaFin as the competent supervisory authority. Violations of or deviations from the rules may be subject to fines and sanctions. The units responsible for compliance and the compliance divisions themselves are also included in Internal Auditing's audits.

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Financial Report > Combined non-financial report > Governance information

KfW Group has established a whistleblowing system to protect whistleblowers. The whistleblowing system enables individuals to provide confidential information on suspicious circumstances that point to criminal acts. Contractual arrangements ensure that a whistleblower’s name and identity will remain protected. As a lawyer, the ombudsperson is subject to a duty of confidentiality, and the whistleblower’s identity is only disclosed to the compliance organisation of the group company affected on request and with the express consent of the whistleblower. The reporting channels for whistleblowers in the event of compliance violations are part of KfW Group’s internal and external whistleblowing system. Information on whistleblower protection is available for employees via the intranet and is also provided by means of digital and in-person training.

The investigation of business conduct incidents is also regulated within KfW Group. Pursuant to Section 25h KWG, banks must create and document adequate safeguards to prevent criminal acts. In this context, a risk analysis of internal and external fraud risks is prepared every year, and appropriate preventive measures derived. Corruption risks exist, for instance, in the approval of loans or subsidies, in procurement and in the award of contracts. Two cases associated with corruption were confirmed in 2024. Neither of the cases involved KfW employees. Specifically, there were allegations of corruption against external bidders, who therefore were not admitted to the award process in line with KfW’s internal guidelines. The Executive Board has adopted group-wide rules of conduct and a Code of Conduct to prevent corruption for all KfW Group employees. These contain binding rules for the acceptance and giving of gifts and other benefits. The option these provide to have the acceptance of gifts and other benefits authorised is intended to protect employees from criminal charges. The focus is on transparency and dealing openly with any conflicts (of interest). An existing work instruction sets out how to deal with gifts and invitations and includes fixed value limits for accepting or giving them.

For the results of Internal Auditing’s annual audit, see the “Additional internal control procedures” section of the risk report.

In order to avoid violations of KfW Group’s compliance regulations, awareness-raising and training measures are carried out to avoid internal and external criminal acts. The heads of division are required to address the topic of preventing corruption once a year in divisional meetings. Obligatory online training on criminal acts, money laundering/terrorism financing and data protection plus additional, target group-oriented in-person training is held every year to ensure responsible conduct by our employees when dealing with business partners. This target group-oriented in-person training organised by the Compliance department is aimed at employees who are deemed to be particularly at risk pursuant to the “risk analysis of criminal acts”. This includes in particular employees involved in award and/or approval processes, and employees in KfW’s foreign branch offices due to their particular vulnerability with regard to corruption and bribery.

In addition, the group plans to communicate changes in corporate culture arising in connection with the “Cultural journey” project to employees through workshops and information events.

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Summary of KPIs to be disclosed by credit institutions under Article 8 Taxonomy Regulation

Summary of KPIs to be disclosed by credit institutions under Article 8 Taxonomy Regulation

Main KPI	Green asset ratio (GAR) stock	Total environmentally sustainable assets (turnover)	Total environmentally sustainable assets (CapEx)	KPI***	KPI***	% coverage (over total assets)***	% of assets excluded from the numerator of the GAR (Article 7 (2) and (3) and Section 1.1.2 of Annex V)	% of assets excluded from the denominator of the GAR (Article 7 (1) and Section 1.2.4 of Annex V)
		832	939	0.2%	0.2%	84.1%	37.0%	15.9%
Additional KPIs	GAR (Btw)	Total environmentally sustainable activities (turnover)	Total environmentally sustainable activities (CapEx)	KPI	KPI	% coverage (over total assets)	% of assets excluded from the numerator of the GAR (Article 7 (2) and (3) and Section 1.1.2 of Annex V)	% of assets excluded from the denominator of the GAR (Article 7 (1) and Section 1.2.4 of Annex V)
---	---	---	---	---	---	---	---	---
	Trading book*	352	446	0.1%	0.1%	13.8%	10.1%	0.7%
	Financial guarantees	0	0	0.6%	0.9%
	Assets under management	0	0	0.0%	0.0%
	Fees and commissions income**

For credit institutions that do not meet the conditions of Article 94 (1) of the CRR or the conditions set out in Article 325a (1) of the CRR
** Fees and commissions income from services other than lending and AuM. Institutions shall disclose forwardlooking information for this KPIs, including information in terms of targets, together with relevant explanations on the methodology applied.
*** % of assets covered by the KPI over banks' total assets
*** Based on the Turnover KPI of the counterparty
*** Based on the CapEx KPI of the counterparty, except for lending activities where for general lending Turnover KPI is used

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

Assets for the calculation of GAR
1. Assets for the calculation of GAR - Turnover

Million EUR	a	b	c	d	e	f	g	h	i	j	k	l	m
Total (gross) carrying amount	Climate Change Mitigation (CCM)	Climate Change Adaptation (CCA)	Water and marine resources (WTR)
Of which towards taxonomy relevant sectors (Taxonomy-eligible) or of which environmentally sustainable (Taxonomy-aligned) or of which unexfermentally sustainable (Taxonomy-aligned)	Of which tax of Proceeds	Of which transitional	Of which enabling	Of which towards taxonomy relevant sectors (Taxonomy-eligible) or of which environmentally sustainable (Taxonomy-aligned)	Of which tax of Proceeds	Of which enabling	Of which towards taxonomy relevant sectors (Taxonomy-aligned)	Of which unexfermentally sustainable (Taxonomy-aligned)	Of which economically	Of which tax of Proceeds	Of which enabling	Of which tax of Proceeds	Of which enabling
	GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	257,431	10,452	831	167	54	134	47	1	0	0	1
2	Financial undertakings	229,824	9,153	505	0	34	23	45	1	0	0	0
3	Credit institutions	228,569	9,042	505	0	34	23	45	1	0	0	0
4	Loans and advances	217,429	5,213	290	0	19	16	17	0	0	0	0
5	Debt securities, including UoP	11,140	3,829	216	0	15	7	28	1	0	0	0
6	Equity instruments	0	0	0		0	0	0	0		0	0
7	Other financial corporations	1,256	111	0	0	0	0	0	0	0	0	0
8	of which investment firms	0	0	0	0	0	0	0	0	0	0	0
9	Loans and advances	0	0	0	0	0	0	0	0	0	0	0
10	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0
11	Equity instruments	0	0	0		0	0	0	0		0	0
12	of which management companies	0	0	0	0	0	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0
15	Equity instruments	0	0	0		0	0	0	0		0	0
16	of which insurance undertakings	1,055	0	0	0	0	0	0	0	0	0	0
17	Loans and advances	1,055	0	0	0	0	0	0	0	0	0	0
18	Debt securities, including UoP	0	0	0		0	0	0	0		0	0
19	Equity instruments	0	0	0		0	0	0	0		0	0
20	Non-financial undertakings	4,545	1,299	323	167	24	112	2	0	0	0	1
21	Loans and advances	4,531	1,286	311	167	24	98	2	0	0	0	1
22	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0
23	Equity instruments	14	14	14		0	14	0	0		0	0
24	Households	4,147	0	0	0	0	0	0	0	0	0
25	of which loans collateralised by residential immovable property	0	0	0	0	0	0	0	0	0	0
26	of which building renovation loans	0	0	0	0	0	0	0	0	0	0
27	of which motor vehicle loans	0	0	0	0	0	0
28	Local governments financing	18,915	0	0	0	0	0	0	0	0	0	0
29	Housing financing	0	0	0	0	0	0	0	0	0	0	0
30	Other local government financing	18,915	0	0	0	0	0	0	0	0	0	0
31	Collateral obtained by taking possession residential and commercial immovable properties	0	0	0	0	0	0	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	202,654
33	Financial and Non-financial undertakings	201,245
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations	138,165
35	Loans and advances	122,463
36	of which loans collateralised by commercial immovable property	585
37	of which building renovation loans	0
38	Debt securities	14,152
39	Equity instruments	1,551
40	Non-EU country counterparties not subject to NFRD disclosure obligations	63,080
41	Loans and advances	53,948
42	Debt securities	6,774
43	Equity instruments	2,358
44	Derivatives	7,445
45	On demand interbank loans	519
46	Cash and cash-related assets	0
47	Other categories of assets (e.g. Goodwill, commodities etc.)	4,356
48	Total GAR assets	460,085	10,452	831	167	54	134	47	1	0	0	0
49	Assets not covered for GAR calculation	87,106
50	Central governments and Supranational issuers	58,063
51	Central banks exposure	26,740
52	Trading book	2,303
53	Total assets	547,192
GPI-balance sheet exposures - Undertakings subject to NFRD disclosure obligations
54	Financial guarantees	25	2	0	0	0	0	0	0	0	0	0
55	Assets under management	0	0	0	0	0	0	0	0	0	0	0
56	Of which debt securities	0	0	0	0	0	0	0	0	0	0	0
57	Of which equity instruments	0	0	0	0	0	0	0	0	0	0	0

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

Assets for the calculation of GAR – Turnover

Million EUR	0	P	Q	r	3	S	U	V	W	X	Z	AA
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		OF which towards taxonomy relevant sectors (Taxonomy-eligible)				OF which towards taxonomy relevant sectors (Taxonomy-eligible)				OF which towards taxonomy relevant sectors (Taxonomy-eligible)
		OF which environmentally sustainable (Taxonomy-aligned)				OF which environmentally sustainable (Taxonomy-aligned)				OF which environmentally sustainable (Taxonomy-aligned)
		OF which Use of Proceeds	OF which enabling	OF which	OF which Use of Proceeds	OF which enabling	OF which	OF which	OF which	OF which	OF which	OF which	OF which	OF which
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	62				63
2	Financial undertakings	0				0				0
3	Credit institutions	0				0				0
4	Loans and advances	0				0				0
5	Debt securities, including UoP	0				0				0
6	Equity instruments	0				0				0
7	Other financial corporations	0				0				0
8	of which investment firms	0				0				0
9	Loans and advances	0				0				0
10	Debt securities, including UoP	0				0				0
11	Equity instruments	0				0				0
12	of which management companies	0				0				0
13	Loans and advances	0				0				0
14	Debt securities, including UoP	0				0				0
15	Equity instruments	0				0				0
16	of which insurance undertakings	0				0				0
17	Loans and advances	0				0				0
18	Debt securities, including UoP	0				0				0
19	Equity instruments	0				0				0
20	Non-financial undertakings	62				63				1
21	Loans and advances	62				63				1
22	Debt securities, including UoP	0				0				0
23	Equity instruments	0				0				0
24	Households	0				0				0
25	of which loans collateralised by residential immovable property	0				0				0
26	of which building renovation loans	0				0				0
27	of which motor vehicle loans	0				0				0
28	Local governments financing	0				0				0
29	Housing financing	0				0				0
30	Other local government financing	0				0				0
31	Collateral obtained by taking possession: residential and commercial immovable properties	0				0				0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)
33	Financial and Non-financial undertakings
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations
35	Loans and advances
36	of which loans collateralised by commercial immovable property
37	of which building renovation loans
38	Debt securities
39	Equity instruments
40	Non-ICI country counterparties not subject to NFRD disclosure obligations
41	Loans and advances
42	Debt securities
43	Equity instruments
44	Derivatives
45	On demand interbank loans
46	Cash and cash-related assets
47	Other categories of assets (e.g. Goodwill, commodities etc.)
48	Total GAR assets	62				63				1
49	Assets not covered for GAR calculation
50	Central governments and Supranational issuers
51	Central banks exposure
52	Trading book
53	Total assets
Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations
54	Financial guarantees	0				0				0
55	Assets under management	0				0				0
56	OF which debt securities	0				0				0
57	OF which equity instruments	0				0				0

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

Assets for the calculation of GAR – Turnover

Million EUR	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BID)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-aligned)
			Of which Use of Proceeds	Of which transitional	Of which enabling
1	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	10,646	832	161	56	135
2	Financial undertakings	9,198	506	0	34	23
3	Credit institutions	9,087	506	0	34	23
4	Loans and advances	5,230	290	0	19	16
5	Debt securities, including UoP	3,858	216	0	15	7
6	Equity instruments	0	0		0	0
7	Other financial corporations	111	0	0	0	0
8	of which investment firms	0	0	0	0	0
9	Loans and advances	0	0	0	0	0
10	Debt securities, including UoP	0	0	0	0	0
11	Equity instruments	0	0		0	0
12	of which management companies	0	0	0	0	0
13	Loans and advances	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0
15	Equity instruments	0	0		0	0
16	of which insurance undertakings	0	0	0	0	0
17	Loans and advances	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0
19	Equity instruments	0	0		0	0
20	Non-financial undertakings	1,448	325	167	24	112
21	Loans and advances	1,435	311	167	24	98
22	Debt securities, including UoP	0	0	0	0	0
23	Equity instruments	14	14		0	14
24	Households	0	0	0	0	0
25	of which loans collateralised by residential immovable property	0	0	0	0	0
26	of which building renovation loans	0	0	0	0	0
27	of which motor vehicle loans	0	0	0	0	0
28	Local governments financing	0	0	0	0	0
29	Housing financing	0	0	0	0	0
30	Other local government financing	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)
33	Financial and Non-financial undertakings
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations
35	Loans and advances
36	of which loans collateralised by commercial immovable property
37	of which building renovation loans
38	Debt securities
39	Equity instruments
40	Non-ICI country counterparties not subject to NFRD disclosure obligations
41	Loans and advances
42	Debt securities
43	Equity instruments
44	Derivatives
45	On demand interbank loans
46	Cash and cash-related assets
47	Other categories of assets (e.g. Goodwill, commodities etc.)
48	Total GAR assets	10,646	832	161	56	135
49	Assets not covered for GAR calculation
50	Central governments and Supranational issuers
51	Central banks exposure
52	Trading book
53	Total assets
GPI balance sheet exposures – Undertakings subject to NFRD disclosure obligations
54	Financial guarantees	2	0	0	0	0
55	Assets under management	0	0	0	0	0
56	Of which debt securities	0	0	0	0	0
57	Of which equity instruments	0	0	0	0	0

KTW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

Assets for the calculation of GAR - Capital expenditure

Million EUR	a	b	c	d	e	f	g	h	i	j	k	l	m	n
		Total (gross) carrying amount	Climate Change Mitigation (CCM)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
			Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which environmentally sustainable (Taxonomy-aligned) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant sectors (Taxonomy-eligible) Of which	Of which towards taxonomy relevant	Of which towards taxonomy relevant	Of which towards taxonomy relevant	Of which towards taxonomy relevant	Of which towards taxonomy relevant	Of which

GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	257,431	10,422	938	167	77	225	48	1	0	0	0	0	0	0
2	Financial undertakings	229,824	9,034	515	0	40	41	46	1	0	0	0	0	0	0
3	Credit institutions	228,569	8,923	515	0	40	41	46	1	0	0	0	0	0	0
4	Loans and advances	217,429	5,192	328	0	25	28	16	1	0	0	0	0	0	0
5	Debt securities, including UoP	11,140	3,731	187	0	15	13	31	1	0	0	0	0	0	0
6	Equity instruments	0	0	0	0	0	0	0	0	0	0	0	0	0	0
7	Other financial corporations	1,256	111	0	0	0	0	0	0	0	0	0	0	0	0
8	of which investment firms	0	0	0	0	0	0	0	0	0	0	0	0	0	0
9	Loans and advances	0	0	0	0	0	0	0	0	0	0	0	0	0	0
10	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0	0	0	0
11	Equity instruments	0	0	0	0	0	0	0	0	0	0	0	0	0	0
12	of which management companies	0	0	0	0	0	0	0	0	0	0	0	0	0	0
13	Loans and advances	0	0	0	0	0	0	0	0	0	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0	0	0	0
15	Equity instruments	0	0	0	0	0	0	0	0	0	0	0	0	0	0
16	of which insurance undertakings	1,055	0	0	0	0	0	0	0	0	0	0	0	0	0
17	Loans and advances	1,055	0	0	0	0	0	0	0	0	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0	0	0	0
19	Equity instruments	0	0	0	0	0	0	0	0	0	0	0	0	0	0
20	Non-financial undertakings	4,545	1,388	423	167	37	183	3	0	0	0	0	0	0	0
21	Loans and advances	4,531	1,374	409	167	37	170	3	0	0	0	0	0	0	0
22	Debt securities, including UoP	0	0	0	0	0	0	0	0	0	0	0	0	0	0
23	Equity instruments	14	14	14	0	0	14	0	0	0	0	0	0	0	0
24	Households	4,147	0	0	0	0	0	0	0	0	0	0	0	0	0
25	of which loans collateralised by residential immovable property	0	0	0	0	0	0	0	0	0	0	0	0	0	0
26	of which building renovation loans	0	0	0	0	0	0	0	0	0	0	0	0	0	0
27	of which motor vehicle loans	0	0	0	0	0	0	0	0	0	0	0	0	0	0
28	Local governments financing	18,915	0	0	0	0	0	0	0	0	0	0	0	0	0
29	Housing financing	0	0	0	0	0	0	0	0	0	0	0	0	0	0
30	Other local government financing	18,915	0	0	0	0	0	0	0	0	0	0	0	0	0
31	Collateral obtained by taking possession residential and commercial immovable properties	0	0	0	0	0	0	0	0	0	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)	202,654
33	Financial and Non-financial undertakings	201,245
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations	138,165
35	Loans and advances	122,463
36	of which loans collateralised by commercial immovable property	585
37	of which building renovation loans	0
38	Debt securities	14,152
39	Equity instruments	1,551
40	Non-EU country counterparties not subject to NFRD disclosure obligations	63,080
41	Loans and advances	53,948
42	Debt securities	6,774
43	Equity instruments	2,358
44	Derivatives	7,445
45	On demand interbank loans	519
46	Cash and cash-related assets	0
47	Other categories of assets (e.g. Goodwill, commodities etc.)	4,356
48	Total GAR assets	460,085	10,422	938	167	77	225	48	1	0	0	0	0	0	0
49	Assets not covered for GAR calculation	87,106
50	Central governments and Supranational issuers	58,063
51	Central banks exposure	26,740
52	Trading book	2,303
53	Total assets	547,192

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

Assets for the calculation of GAR – Capital expenditure

Million EUR	0	P	Q	r	3	S	U	V	W	X	Z	AA
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		OF which towards taxonomy relevant sectors (Taxonomy-eligible)				OF which towards taxonomy relevant sectors (Taxonomy-eligible)				OF which towards taxonomy relevant sectors (Taxonomy-eligible)
		OF which environmentally sustainable (Taxonomy-aligned)				OF which environmentally sustainable (Taxonomy-aligned)				OF which environmentally sustainable (Taxonomy-aligned)
		OF which Use of Proceeds	OF which enabling	OF which	OF which Use of Proceeds	OF which enabling	OF which	OF which	OF which	OF which	OF which	OF which	OF which	OF which
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	55				0
2	Financial undertakings	0				0				0
3	Credit institutions	0				0				0
4	Loans and advances	0				0				0
5	Debt securities, including UoP	0				0				0
6	Equity instruments	0				0				0
7	Other financial corporations	0				0				0
8	of which investment firms	0				0				0
9	Loans and advances	0				0				0
10	Debt securities, including UoP	0				0				0
11	Equity instruments	0				0				0
12	of which management companies	0				0				0
13	Loans and advances	0				0				0
14	Debt securities, including UoP	0				0				0
15	Equity instruments	0				0				0
16	of which insurance undertakings	0				0				0
17	Loans and advances	0				0				0
18	Debt securities, including UoP	0				0				0
19	Equity instruments	0				0				0
20	Non-financial undertakings	55				92				1
21	Loans and advances	55				92				0
22	Debt securities, including UoP	0				0				0
23	Equity instruments	0				0				0
24	Households	0				0				0
25	of which loans collateralised by residential immovable property	0				0				0
26	of which building renovation loans	0				0				0
27	of which motor vehicle loans	0				0				0
28	Local governments financing	0				0				0
29	Housing financing	0				0				0
30	Other local government financing	0				0				0
31	Collateral obtained by taking possession: residential and commercial immovable properties	0				0				0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)
33	Financial and Non-financial undertakings
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations
35	Loans and advances
36	of which loans collateralised by commercial immovable property
37	of which building renovation loans
38	Debt securities
39	Equity instruments
40	Non-ICI country counterparties not subject to NFRD disclosure obligations
41	Loans and advances
42	Debt securities
43	Equity instruments
44	Derivatives
45	On demand interbank loans
46	Cash and cash-related assets
47	Other categories of assets (e.g. Goodwill, commodities etc.)
48	Total GAR assets
49	Assets not covered for GAR calculation
50	Central governments and Supranational issuers
51	Central banks exposure
52	Trading book
53	Total assets
Off-balance sheet exposures – Undertakings subject to NFRD disclosure obligations
54	Financial guarantees	0				0				0
55	Assets under management	0				0				0
56	OF which debt securities	0				0				0
57	OF which equity instruments	0				0				0

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

Assets for the calculation of GAR – Capital expenditure

Million EUR	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BID)
Of which towards taxonomy relevant sectors (Taxonomy-eligible)
Of which environmentally sustainable (Taxonomy-aligned)
			Of which
(no of Proceeds)	Of which
transitional	Of which
enabling
1	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	10,619	899	161	77	225
2	Financial undertakings	9,080	516	0	40	42
3	Credit institutions	8,970	516	0	40	42
4	Loans and advances	5,208	328	0	25	29
5	Debt securities, including UoP	3,762	188	0	15	13
6	Equity instruments	0	0		0	0
7	Other financial corporations	111	0	0	0	0
8	of which investment firms	0	0	0	0	0
9	Loans and advances	0	0	0	0	0
10	Debt securities, including UoP	0	0	0	0	0
11	Equity instruments	0	0		0	0
12	of which management companies	0	0	0	0	0
13	Loans and advances	0	0	0	0	0
14	Debt securities, including UoP	0	0	0	0	0
15	Equity instruments	0	0		0	0
16	of which insurance undertakings	0	0	0	0	0
17	Loans and advances	0	0	0	0	0
18	Debt securities, including UoP	0	0	0	0	0
19	Equity instruments	0	0		0	0
20	Non-financial undertakings	1,539	423	167	37	183
21	Loans and advances	1,525	409	167	37	170
22	Debt securities, including UoP	0	0	0	0	0
23	Equity instruments	14	14		0	14
24	Households	0	0	0	0	0
25	of which loans collateralised by residential immovable property	0	0	0	0	0
26	of which building renovation loans	0	0	0	0	0
27	of which motor vehicle loans	0	0	0	0	0
28	Local governments financing	0	0	0	0	0
29	Housing financing	0	0	0	0	0
30	Other local government financing	0	0	0	0	0
31	Collateral obtained by taking possession: residential and commercial immovable properties	0	0	0	0	0
32	Assets excluded from the numerator for GAR calculation (covered in the denominator)
33	Financial and Non-financial undertakings
34	SMEs and NPCs (other than SMEs) not subject to NFRD disclosure obligations
35	Loans and advances
36	of which loans collateralised by commercial immovable property
37	of which building renovation loans
38	Debt securities
39	Equity instruments
40	Non-EU country counterparties not subject to NFRD disclosure obligations
41	Loans and advances
42	Debt securities
43	Equity instruments
44	Derivatives
45	On demand interbank loans
46	Cash and cash-related assets
47	Other categories of assets (e.g. Goodwill, commodities etc.)
48	Total GAR assets	10,619	899	161	77	225
49	Assets not covered for GAR calculation
50	Central governments and Supranational issuers
51	Central banks exposure
52	Trading book
53	Total assets
GPI balance sheet exposures – Undertakings subject to NFRD disclosure obligations
54	Financial guarantees	2	0	0	0	0
55	Assets under management	0	0	0	0	0
56	Of which debt securities	0	0	0	0	0
57	Of which equity instruments	0	0	0	0	0

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR sector information

GAR sector information - Turnover

	a b c d e f g h i j k l m				Climate Change Adaptation (CCA)				Water and marine resources (WTR)				Circular economy (CE)
	Climate Change Mitigation (CCM)		SMEs and other NFC not subject to NFRD		Non-Financial corporates (Subject to NFRD)		SMEs and other NFC not subject to NFRD		Non-Financial corporates (Subject to NFRD)		SMEs and other NFC not subject to NFRD		Non-Financial corporates (Subject to NFRD)
	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount
Breakdown by sector - NACE 4 digits level (code and label)	Mo EUR	Of which environmentally sustainable (CCM)	Mo EUR	Of which environmentally sustainable (CCM)	Mo EUR	Of which environmentally sustainable (CCA)	Mo EUR	Of which environmentally sustainable (CCA)	Mo EUR	Of which environmentally sustainable (WTR)	Mo EUR	Of which environmentally sustainable (WTR)	Mo EUR	Of which environmentally sustainable (CE)
1	35.11 - Production of electricity	192	185		0	0			1				0
2	27.90 - Manufacture of other electrical equipment	0	0		0	0			0				0
3	29.10 - Manufacture of motor vehicles	241	29		0	0			0				0
4	47.1 - Retail sale in non-specialised stores	0	0		0	0			0				0
5	50 - Water transport	275	8		0	0			0				0
6	52.22 - Service activities incidental to water transportation	109	40		0	0			0				0
7	70.10 - Activities of head offices	184	35		2	0			0				15
8	86.90 - Other human health activities	9	0		0	0			0				0
9	10.5 - Manufacture of dairy products	0	0		0	0			0				0
10	11.0 - Manufacture of beverages	0	0		0	0			0				0
11	68.20 - Renting and operating of own or leased real estate	0	0		0	0			0				0
12	52.23 - Service activities incidental to air transportation	179	0		0	0			0				0
13	24.45 - Other non-ferrous metal production	0	0		0	0			0				0
14	17.2 - Manufacture of articles of paper and paperboard	0	0		0	0			0				0
15	24.10 - Manufacture of basic iron and steel and of ferro-alloys	69	26		0	0			0				0
16	20.5 - Manufacture of other chemical products	41	1		0	0			0				2
17	26.1 - Manufacture of electronic components and boards	0	0		0	0			0				46
18	29.31 - Manufacture of electrical and electronic equipment for motor vehicles	4	2		0	0			0				0
19	29.32 - Manufacture of other parts and accessories for motor vehicles	1	0		0	0			0				0
20	77.31 - Renting and leasing of agricultural machinery and equipment	0	0		0	0			0				0
21	52.21 - Service activities incidental to land transportation	0	0		0	0			0				0
22	21 - Manufacture of basic pharmaceutical products and pharmaceutical preparations	0	0		0	0			0				0
23	20.13 - Manufacture of other inorganic basic chemicals	0	0		0	0			0				0
24	72.1 - Research and experimental development on natural sciences and engineering	0	0		0	0			0				0
25	30.30 - Manufacture of air and spacecraft and related machinery	0	0		0	0			0				0
26	32.9 - Manufacturing n.e.c.	0	0		0	0			0				0
27	35.2 - Manufacture of gas; distribution of gaseous fuels through mains	0	0		0	0			0				0
28	35.13 - Distribution of electricity	0	0		0	0			0				0

KTW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR sector information – Turnover

	II D		III F		S S		U V		W X		Y Z		AA AB
	Circular economy (CE)		Pollution (PPC)				Biodiversity and Ecosystems (BID)				TOTAL (CCM + CCA + WTR + CE + PPC + BID)
	SMEs and other NFC not subject to NFRD (Gross) carrying amount	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount
Breakdown by sector - NACE 4 digits level (code and label)	Mn EUR	Of which environmentally sustainable (CE)	Mn EUR	Of which environmentally sustainable (PPC)	Mn EUR	Of which environmentally sustainable (PPC)	Mn EUR	Of which environmentally sustainable (BID)	Mn EUR	Of which environmentally sustainable (BID)	Mn EUR	Of which environmentally sustainable (CCM + CCA + WTR + CE + PPC + BID)	Mn EUR	Of which environmentally sustainable (CCM + CCA + WTR + CE + PPC + BID)
1	35.11 - Production of electricity			0				0				193	185
2	27.90 - Manufacture of other electrical equipment			0				0				0	0
3	29.10 - Manufacture of motor vehicles			0				0				241	29
4	47.1 - Retail sale in non-specialised stores			0				0				0	0
5	50 - Water transport			0				1				276	8
6	52.22 - Service activities incidental to water transportation			0				0				109	40
7	70.10 - Activities of head offices			68				0				269	35
8	86.90 - Other human health activities			14				0				23	0
9	10.5 - Manufacture of dairy products			0				0				0	0
10	11.0 - Manufacture of beverages			0				0				0	0
11	68.20 - Renting and operating of own or leased real estate			0				0				0	0
12	52.23 - Service activities incidental to air transportation			0				0				175	0
13	24.45 - Other non-ferrous metal production			0				0				0	0
14	17.2 - Manufacture of articles of paper and paperboard			0				0				0	0
15	24.10 - Manufacture of basic iron and steel and of ferro-alloys			0				0				69	26
16	20.5 - Manufacture of other chemical products			1				0				42	1
17	26.1 - Manufacture of electronic components and boards			0				0				46	0
18	29.31 - Manufacture of electrical and electronic equipment for motor vehicles			0				0				4	2
19	29.32 - Manufacture of other parts and accessories for motor vehicles			0				0				1	0
20	77.31 - Renting and leasing of agricultural machinery and equipment			0				0				0	0
21	52.21 - Service activities incidental to land transportation			0				0				0	0
22	21 - Manufacture of basic pharmaceutical products and pharmaceutical preparations			0				0				0	0
23	20.13 - Manufacture of other inorganic basic chemicals			0				0				0	0
24	72.1 - Research and experimental development on natural sciences and engineering			0				0				0	0
25	30.30 - Manufacture of air and spacecraft and related machinery			0				0				0	0
26	32.9 - Manufacturing n.e.c.			0				0				0	0
27	35.2 - Manufacture of gas, distribution of gaseous fuels through mains			0				0				0	0
28	35.13 - Distribution of electricity			0				0				0	0

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR sector information – Capital expenditure

	a b c d e f g h i j m s
	Climate Change Mitigation (CCM)		SMEs and other NFC not subject to NFRD		Climate Change Adaptation (CCA)		SMEs and other NFC not subject to NFRD		Water and marine resources (WTR)		Circular economy (CE)
	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount	(Gross) carrying amount
Breakdown by sector – NACE 4 digits level (code and label)	Mo EUR	Of which environmentally sustainable (CCM)	Mo EUR	Of which environmentally sustainable (CCA)	Mo EUR	Of which environmentally sustainable (CCA)	Mo EUR	Of which environmentally sustainable (WTR)	Mo EUR	Of which environmentally sustainable (WTR)	Mo EUR	Of which environmentally sustainable (CE)
1	35.11 – Production of electricity	213	211		0	0		0			0
2	27.90 – Manufacture of other electrical equipment	0	0		0	0		0			0
3	29.10 – Manufacture of motor vehicles	260	82		0	0		0			0
4	47.1 – Retail sale in non-specialised stores	0	0		0	0		0			0
5	50 – Water transport	288	22		0	0		0			0
6	52.22 – Service activities incidental to water transportation	107	44		0	0		0			0
7	70.10 – Activities of head offices	198	36		3	0		0			7
8	86.90 – Other human health activities	26	0		0	0		0			2
9	10.5 – Manufacture of dairy products	0	0		0	0		0			0
10	11.0 – Manufacture of beverages	0	0		0	0		0			0
11	68.20 – Renting and operating of own or leased real estate	0	0		0	0		0			0
12	52.23 – Service activities incidental to air transportation	175	0		0	0		0			0
13	24.45 – Other non-ferrous metal production	0	0		0	0		0			0
14	17.2 – Manufacture of articles of paper and paperboard	1	0		0	0		0			0
15	24.10 – Manufacture of basic iron and steel and of ferro-alloys	76	23		0	0		0			0
16	20.5 – Manufacture of other chemical products	20	0		0	0		0			2
17	26.1 – Manufacture of electronic components and boards	7	0		0	0		0			46
18	29.31 – Manufacture of electrical and electronic equipment for motor vehicles	15	5		0	0		0			0
19	29.32 – Manufacture of other parts and accessories for motor vehicles	3	0		0	0		0			0
20	77.31 – Renting and leasing of agricultural machinery and equipment	0	0		0	0		0			0
21	52.21 – Service activities incidental to land transportation	0	0		0	0		0			0
22	21 – Manufacture of basic pharmaceutical products and pharmaceutical preparations	0	0		0	0		0			0
23	20.13 – Manufacture of other inorganic basic chemicals	0	0		0	0		0			0
24	72.1 – Research and experimental development on natural sciences and engineering	0	0		0	0		0			0
25	30.30 – Manufacture of air and spacecraft and related machinery	0	0		0	0		0			0
26	32.9 – Manufacturing n.e.c.	0	0		0	0		0			0
27	35.2 – Manufacture of gas; distribution of gaseous fuels through mains	0	0		0	0		0			0
28	35.13 – Distribution of electricity	0	0		0	0		0			0

KTW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR sector information – Capital expenditure

	II D		II F		3	5	II V		III W		X	X	X	AB
	Circular economy (CE)		Pollution (PPC)				Biodiversity and Ecosystems (BIO)				TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
	SMEs and other NFC not subject to NFRD (Gross) carrying amount	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	Non-Financial corporates (Subject to NFRD) (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount	SMEs and other NFC not subject to NFRD (Gross) carrying amount
Breakdown by sector - NACE 4 digits level (code and label)	Mn EUR	Of which environmentally sustainable (CE)	Mn EUR	Of which environmentally sustainable (PPC)	Mn EUR	Of which environmentally sustainable (BIO)	Mn EUR	Of which environmentally sustainable (BIO)	Mn EUR	Of which environmentally sustainable (CIM + CCA + WTR + CE + PPC + BIO)	Mn EUR	Of which environmentally sustainable (CCM + CCA + WTR + CE + PPC + BIO)	Mn EUR	Of which environmentally sustainable (CCM + CCA + WTR + CE + PPC + BIO)
1	35.11 - Production of electricity			0			0				213	211
2	27.90 - Manufacture of other electrical equipment			0			0				0	0
3	29.10 - Manufacture of motor vehicles			0			0				260	82
4	47.1 - Retail sale in non-specialised stores			0			0				0	0
5	50 - Water transport			0			1				289	22
6	52.22 - Service activities incidental to water transportation			0			0				107	44
7	70.10 - Activities of head offices			77			0				284	37
8	86.90 - Other human health activities			6			0				54	0
9	10.5 - Manufacture of dairy products			0			0				0	0
10	11.0 - Manufacture of beverages			0			0				0	0
11	68.20 - Renting and operating of own or leased real estate			0			0				0	0
12	52.23 - Service activities incidental to air transportation			0			0				175	0
13	24.45 - Other non-ferrous metal production			0			0				0	0
14	17.2 - Manufacture of articles of paper and paperboard			0			0				1	0
15	24.10 - Manufacture of basic iron and steel and of ferro-alloys			0			0				76	23
16	20.5 - Manufacture of other chemical products			10			0				29	0
17	26.1 - Manufacture of electronic components and boards			0			0				54	0
18	29.31 - Manufacture of electrical and electronic equipment for motor vehicles			0			0				15	5
19	29.32 - Manufacture of other parts and accessories for motor vehicles			0			0				3	0
20	77.31 - Renting and leasing of agricultural machinery and equipment			0			0				0	0
21	52.21 - Service activities incidental to land transportation			0			0				0	0
22	21 - Manufacture of basic pharmaceutical products and pharmaceutical preparations			0			0				0	0
23	20.13 - Manufacture of other inorganic basic chemicals			0			0				0	0
24	72.1 - Research and experimental development on natural sciences and engineering			0			0				0	0
25	30.30 - Manufacture of air and spacecraft and related machinery			0			0				0	0
26	32.9 - Manufacturing e.e.c.			0			0				0	0
27	35.2 - Manufacture of gas, distribution of gaseous fuels through mains			0			0				0	0
28	35.13 - Distribution of electricity			0			0				0	0

KTW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELK 2021/2178 (DDA)

GAR KPI stock

3. GAR KPI stock - Turnover

% (compared to total covered assets in the denominator)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Climate Change Mitigation (CCM)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which (no of Proceeds)	Of which (pensions)	Of which (audits)			Of which (no of Proceeds)	Of which (audits)			Of which (no of Proceeds)	Of which (audits)
GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	2.3%	0.2%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2	Financial undertakings	2.0%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
3	Credit institutions	2.0%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
4	Loans and advances	1.1%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
5	Debt securities, including UoP	0.8%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
20	Non-financial undertakings	0.3%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
21	Loans and advances	0.3%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25	of which loans collateralised by residential immovable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	2.3%	0.2%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELII 2021/2178 (DDA)

GAR KPI stock – Turnover

% (compared to total covered assets in the denominator)	n	p	q	r	s	t	u	v	w	x	z
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which (no of Proceeds)	Of which positive			Of which (no of Proceeds)	Of which positive			Of which (no of Proceeds)	Of which positive
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.0%			0.0%				0.0%
2	Financial undertakings	0.0%			0.0%				0.0%
3	Credit institutions	0.0%			0.0%				0.0%
4	Loans and advances	0.0%			0.0%				0.0%
5	Debt securities, including UoP	0.0%			0.0%				0.0%
6	Equity instruments	0.0%			0.0%				0.0%
7	Other financial corporations	0.0%			0.0%				0.0%
8	of which investment firms	0.0%			0.0%				0.0%
9	Loans and advances	0.0%			0.0%				0.0%
10	Debt securities, including UoP	0.0%			0.0%				0.0%
11	Equity instruments	0.0%			0.0%				0.0%
12	of which management companies	0.0%			0.0%				0.0%
13	Loans and advances	0.0%			0.0%				0.0%
14	Debt securities, including UoP	0.0%			0.0%				0.0%
15	Equity instruments	0.0%			0.0%				0.0%
16	of which insurance undertakings	0.0%			0.0%				0.0%
17	Loans and advances	0.0%			0.0%				0.0%
18	Debt securities, including UoP	0.0%			0.0%				0.0%
19	Equity instruments	0.0%			0.0%				0.0%
20	Non-financial undertakings	0.0%			0.0%				0.0%
21	Loans and advances	0.0%			0.0%				0.0%
22	Debt securities, including UoP	0.0%			0.0%				0.0%
23	Equity instruments	0.0%			0.0%				0.0%
24	Households	0.0%
25	of which loans collateralised by residential immovable property	0.0%
26	of which building renovation loans	0.0%
27	of which motor vehicle loans
28	Local governments financing	0.0%			0.0%				0.0%
29	Housing financing	0.0%			0.0%				0.0%
30	Other local government financing	0.0%			0.0%				0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%			0.0%				0.0%
32	Total GAR assets	0.0%			0.0%				0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

GAR KPI stock – Turnover

% (compared to total covered assets in the denominator)	aa	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)					Proportion of total assets covered
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Functional	Of which Audited
GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	2.3%	0.2%	0.0%	0.0%	0.0%	56.0%
2	Financial undertakings	2.0%	0.1%	0.0%	0.0%	0.0%	50.0%
3	Credit institutions	2.0%	0.1%	0.0%	0.0%	0.0%	49.7%
4	Loans and advances	1.1%	0.1%	0.0%	0.0%	0.0%	47.3%
5	Debt securities, including UoP	0.8%	0.0%	0.0%	0.0%	0.0%	2.4%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.3%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.2%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.2%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
20	Non-financial undertakings	0.3%	0.1%	0.0%	0.0%	0.0%	1.0%
21	Loans and advances	0.3%	0.1%	0.0%	0.0%	0.0%	1.0%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.9%
25	of which loans collateralised by residential irrevocable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	4.1%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	4.1%
31	Collateral obtained by taking possession: residential and commercial irrevocable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	2.3%	0.2%	0.0%	0.0%	0.0%	100.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR KPI stock – Capital expenditure

% (compared to total covered assets in the denominator)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Climate Change Mitigation (CCM)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which (no of Proceeds)	Of which (pensions)	Of which (audits)			Of which (no of Proceeds)	Of which (audits)			Of which (no of Proceeds)	Of which (audits)
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	2.3%	0.2%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2	Financial undertakings	2.0%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
3	Credit institutions	1.9%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
4	Loans and advances	1.1%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
5	Debt securities, including UoP	0.8%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
20	Non-financial undertakings	0.3%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
21	Loans and advances	0.3%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25	of which loans collateralised by residential immovable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	2.3%	0.2%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELII 2021/2178 (DDA)

GAR KPI stock – Capital expenditure

% (compared to total covered assets in the denominator)	n	p	q	r	s	t	v	w	x
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)			Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Positive		Of which Use of Proceeds	Of which Positive		Of which Use of Proceeds
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.0%				0.0%			0.0%
2	Financial undertakings	0.0%				0.0%			0.0%
3	Credit institutions	0.0%				0.0%			0.0%
4	Loans and advances	0.0%				0.0%			0.0%
5	Debt securities, including UoP	0.0%				0.0%			0.0%
6	Equity instruments	0.0%				0.0%			0.0%
7	Other financial corporations	0.0%				0.0%			0.0%
8	of which investment firms	0.0%				0.0%			0.0%
9	Loans and advances	0.0%				0.0%			0.0%
10	Debt securities, including UoP	0.0%				0.0%			0.0%
11	Equity instruments	0.0%				0.0%			0.0%
12	of which management companies	0.0%				0.0%			0.0%
13	Loans and advances	0.0%				0.0%			0.0%
14	Debt securities, including UoP	0.0%				0.0%			0.0%
15	Equity instruments	0.0%				0.0%			0.0%
16	of which insurance undertakings	0.0%				0.0%			0.0%
17	Loans and advances	0.0%				0.0%			0.0%
18	Debt securities, including UoP	0.0%				0.0%			0.0%
19	Equity instruments	0.0%				0.0%			0.0%
20	Non-financial undertakings	0.0%				0.0%			0.0%
21	Loans and advances	0.0%				0.0%			0.0%
22	Debt securities, including UoP	0.0%				0.0%			0.0%
23	Equity instruments	0.0%				0.0%			0.0%
24	Households	0.0%
25	of which loans collateralised by residential immovable property	0.0%
26	of which building renovation loans	0.0%
27	of which motor vehicle loans
28	Local governments financing	0.0%				0.0%			0.0%
29	Housing financing	0.0%				0.0%			0.0%
30	Other local government financing	0.0%				0.0%			0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%				0.0%			0.0%
32	Total GAR assets	0.0%				0.0%			0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

GAR KPI stock – Capital expenditure

% (compared to total covered assets in the denominator)	aa	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)					Proportion of total assets covered
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Functional	Of which Audited
GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	2.3%	0.2%	0.0%	0.0%	0.0%	56.0%
2	Financial undertakings	2.0%	0.1%	0.0%	0.0%	0.0%	50.0%
3	Credit institutions	1.9%	0.1%	0.0%	0.0%	0.0%	49.7%
4	Loans and advances	1.1%	0.1%	0.0%	0.0%	0.0%	47.3%
5	Debt securities, including UoP	0.8%	0.0%	0.0%	0.0%	0.0%	2.4%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.3%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.2%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.2%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
20	Non-financial undertakings	0.3%	0.1%	0.0%	0.0%	0.0%	1.0%
21	Loans and advances	0.3%	0.1%	0.0%	0.0%	0.0%	1.0%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.9%
25	of which loans collateralised by residential irrevocable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	4.1%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	4.1%
31	Collateral obtained by taking possession: residential and commercial irrevocable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	2.3%	0.2%	0.0%	0.0%	0.0%	100.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELK 2021/2178 (DDA)

GAR KPI flow

GAR KPI flow - Turnover

% (compared to flow of total eligible assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
	Climate Change Mitigation (CCM)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
	Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			OF which Use of Proceeds	OF which Unrestricted	OF which restated			OF which Use of Proceeds	OF which restated			OF which Use of Proceeds	OF which restated
GAR - Covered assets in both numerator and denominator
1 Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	0.6%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2 Financial undertakings	0.5%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
3 Credit institutions	0.5%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
4 Loans and advances	0.4%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
5 Debt securities, including UoP	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
6 Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
7 Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8 of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9 Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10 Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11 Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
12 of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13 Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14 Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15 Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
16 of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17 Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18 Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19 Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
20 Non-financial undertakings	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
21 Loans and advances	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
22 Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23 Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
24 Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25 of which loans collateralised by residential immovable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26 of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27 of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%
28 Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
29 Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30 Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
31 Collateral obtained by taking possession: residential and commercial immovable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
Total GAR assets	0.6%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELK 2021/2178 (DDA))

GAR KPI flow – Turnover

% (compared to flow of total eligible assets)	n	n	p	q	r	s	u	u	w	z
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)			Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Positive		Of which Use of Proceeds	Of which Positive		Of which Use of Proceeds	Of which Positive
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.0%				0.0%			0.0%
2	Financial undertakings	0.0%				0.0%			0.0%
3	Credit institutions	0.0%				0.0%			0.0%
4	Loans and advances	0.0%				0.0%			0.0%
5	Debt securities, including UoP	0.0%				0.0%			0.0%
6	Equity instruments	0.0%				0.0%			0.0%
7	Other financial corporations	0.0%				0.0%			0.0%
8	of which investment firms	0.0%				0.0%			0.0%
9	Loans and advances	0.0%				0.0%			0.0%
10	Debt securities, including UoP	0.0%				0.0%			0.0%
11	Equity instruments	0.0%				0.0%			0.0%
12	of which management companies	0.0%				0.0%			0.0%
13	Loans and advances	0.0%				0.0%			0.0%
14	Debt securities, including UoP	0.0%				0.0%			0.0%
15	Equity instruments	0.0%				0.0%			0.0%
16	of which insurance undertakings	0.0%				0.0%			0.0%
17	Loans and advances	0.0%				0.0%			0.0%
18	Debt securities, including UoP	0.0%				0.0%			0.0%
19	Equity instruments	0.0%				0.0%			0.0%
20	Non-financial undertakings	0.0%				0.0%			0.0%
21	Loans and advances	0.0%				0.0%			0.0%
22	Debt securities, including UoP	0.0%				0.0%			0.0%
23	Equity instruments	0.0%				0.0%			0.0%
24	Households	0.0%
25	of which loans collateralised by residential immovable property	0.0%
26	of which building renovation loans	0.0%
27	of which motor vehicle loans
28	Local governments financing	0.0%				0.0%			0.0%
29	Housing financing	0.0%				0.0%			0.0%
30	Other local government financing	0.0%				0.0%			0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%				0.0%			0.0%
32	Total GAR assets	0.0%				0.0%			0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

GAR KPI flow – Turnover

% (compared to flow of total eligible assets)	aa	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)					Proportion of total new assets covered
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total new assets covered
		(Taxonomy-aligned)
			Of which Use of Proceeds	Of which Functional	Of which Auditing
GAR - Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.6%	0.1%	0.0%	0.0%	0.0%	4.5%
2	Financial undertakings	0.5%	0.1%	0.0%	0.0%	0.0%	3.6%
3	Credit institutions	0.5%	0.1%	0.0%	0.0%	0.0%	3.6%
4	Loans and advances	0.4%	0.1%	0.0%	0.0%	0.0%	3.2%
5	Debt securities, including UoP	0.1%	0.0%	0.0%	0.0%	0.0%	0.4%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
20	Non-financial undertakings	0.1%	0.0%	0.0%	0.0%	0.0%	0.2%
21	Loans and advances	0.1%	0.0%	0.0%	0.0%	0.0%	0.2%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25	of which loans collateralised by residential immovable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.6%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.6%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	0.6%	0.1%	0.0%	0.0%	0.0%	16.4%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR KPI flow – Capital expenditure

% (compared to flow of total eligible assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Climate Change Mitigation (CCM)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			GF which (no of Proceeds)	OF which (pensions)	OF which (audits)			GF which (no of Proceeds)	OF which (audits)			GF which (no of Proceeds)	OF which (audits)
	GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HIT eligible for GAR calculation	0.6%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2	Financial undertakings	0.5%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
3	Credit institutions	0.5%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
4	Loans and advances	0.4%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
5	Debt securities, including UoP	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
20	Non-financial undertakings	0.1%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
21	Loans and advances	0.1%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%	0.0%		0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25	of which loans collateralised by residential immovable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	0.6%	0.1%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELII 2021/2178 (DDA)

GAR KPI flow – Capital expenditure

% (compared to flow of total eligible assets)	n	n	p	q	r	s	s	u	u	w	x	z
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
			Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Positive			Of which Use of Proceeds	Of which Positive			Of which Use of Proceeds	Of which Positive
GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.0%				0.0%				0.0%
2	Financial undertakings	0.0%				0.0%				0.0%
3	Credit institutions	0.0%				0.0%				0.0%
4	Loans and advances	0.0%				0.0%				0.0%
5	Debt securities, including UoP	0.0%				0.0%				0.0%
6	Equity instruments	0.0%				0.0%				0.0%
7	Other financial corporations	0.0%				0.0%				0.0%
8	of which investment firms	0.0%				0.0%				0.0%
9	Loans and advances	0.0%				0.0%				0.0%
10	Debt securities, including UoP	0.0%				0.0%				0.0%
11	Equity instruments	0.0%				0.0%				0.0%
12	of which management companies	0.0%				0.0%				0.0%
13	Loans and advances	0.0%				0.0%				0.0%
14	Debt securities, including UoP	0.0%				0.0%				0.0%
15	Equity instruments	0.0%				0.0%				0.0%
16	of which insurance undertakings	0.0%				0.0%				0.0%
17	Loans and advances	0.0%				0.0%				0.0%
18	Debt securities, including UoP	0.0%				0.0%				0.0%
19	Equity instruments	0.0%				0.0%				0.0%
20	Non-financial undertakings	0.0%				0.0%				0.0%
21	Loans and advances	0.0%				0.0%				0.0%
22	Debt securities, including UoP	0.0%				0.0%				0.0%
23	Equity instruments	0.0%				0.0%				0.0%
24	Households	0.0%
25	of which loans collateralised by residential immovable property	0.0%
26	of which building renovation loans	0.0%
27	of which motor vehicle loans
28	Local governments financing	0.0%				0.0%				0.0%
29	Housing financing	0.0%				0.0%				0.0%
30	Other local government financing	0.0%				0.0%				0.0%
31	Collateral obtained by taking possession: residential and commercial immovable properties	0.0%				0.0%				0.0%
32	Total GAR assets	0.0%				0.0%				0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

GAR KPI flow – Capital expenditure

% (compared to flow of total eligible assets)	aa	ab	ac	ad	ae	af
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)					Proportion of total new assets covered
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
				Of which Use of Proceeds	Of which Functional	Of which Audited
GAR – Covered assets in both numerator and denominator
1	Loans and advances, debt securities and equity instruments not HFT eligible for GAR calculation	0.7%	0.1%	0.0%	0.0%	0.0%	4.5%
2	Financial undertakings	0.5%	0.0%	0.0%	0.0%	0.0%	3.6%
3	Credit institutions	0.5%	0.0%	0.0%	0.0%	0.0%	3.6%
4	Loans and advances	0.4%	0.0%	0.0%	0.0%	0.0%	3.2%
5	Debt securities, including UoP	0.1%	0.0%	0.0%	0.0%	0.0%	0.4%
6	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
7	Other financial corporations	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
8	of which investment firms	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
9	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
10	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
11	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
12	of which management companies	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
13	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
14	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
15	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
16	of which insurance undertakings	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
17	Loans and advances	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
18	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
19	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
20	Non-financial undertakings	0.1%	0.1%	0.0%	0.0%	0.0%	0.2%
21	Loans and advances	0.1%	0.1%	0.0%	0.0%	0.0%	0.2%
22	Debt securities, including UoP	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
23	Equity instruments	0.0%	0.0%		0.0%	0.0%	0.0%
24	Households	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
25	of which loans collateralised by residential irrevocable property	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
26	of which building renovation loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
27	of which motor vehicle loans	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
28	Local governments financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.6%
29	Housing financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
30	Other local government financing	0.0%	0.0%	0.0%	0.0%	0.0%	0.6%
31	Collateral obtained by taking possession: residential and commercial irrevocable properties	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
32	Total GAR assets	0.7%	0.1%	0.0%	0.0%	0.0%	16.4%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

KPI off-balance sheet exposures

5. KPI off-balance sheet exposures – Turnover

% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Discharge Obligation (CCM)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which transitional	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	7.4%	0.6%	0.0%	0.2%	0.3%	0.4%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%				0.0%				0.0%
2	Assets under management (AuM KPI)	0.0%				0.0%				0.0%
% (compared to total eligible off-balance sheet assets)	aa	ab	ac	ad	ae
---	---	---	---	---	---	---
		Disclosure reference date 1
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which transitional	Of which enabling
1	Financial guarantees (FinGuar KPI)	7.8%	0.6%	0.0%	0.2%	0.3%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

KPI off-balance sheet exposures – Turnover (flow)

% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Climate Change Mitigation (CCM)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Of which Use of Proceeds	Of which transitional	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
		Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%				0.0%				0.0%
2	Assets under management (AuM KPI)	0.0%				0.0%				0.0%
% (compared to total eligible off-balance sheet assets)	aa	ab	ac	ad	ae
---	---	---	---	---	---	---
		Disclosure reference date T
		TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which transitional	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (ELI) 2021/2178 (DDA)

KPI off-balance sheet exposures – Capital expenditure

% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Discharge Obligation (CCM)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Of which Use of Proceeds	Of which transitional	Of which enabling	Of which Use of Proceeds	Of which enabling	Of which Use of Proceeds	Of which enabling	Of which Use of Proceeds	Of which enabling	Of which Use of Proceeds	Of which	Of which	Of which
1	Financial guarantees (FinGuar KPI)	6.1%	0.9%	0.0%	0.2%	0.6%	0.7%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
		Of which Use of Proceeds	Of which enabling	Of which use of Proceeds	Of which enabling	Of which use of Proceeds	Of which	Of which	Of which	Of which	Of which	Of which	Of which	Of which
1	Financial guarantees (FinGuar KPI)	0.0%				0.0%				0.0%
2	Assets under management (AuM KPI)	0.0%				0.0%				0.0%
% (compared to total eligible off-balance sheet assets)	aa	ab	ac	ad	ae
---	---	---	---	---	---	---
		Disclosure reference date T
	TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which transitional	Of which enabling
1	Financial guarantees (FinGuar KPI)	6.7%	0.9%	0.0%	0.2%	0.6%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XX (EU) 2021/2178 (DDA)

KPI off-balance sheet exposures – Capital expenditure (flow)

% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
		Climate Change Mitigation (CCM)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Climate Change Adaptation (CCA)				Water and marine resources (WTR)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)					Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Of which Use of Proceeds	Of which transitional	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%	0.0%
% (compared to total eligible off-balance sheet assets)	a	b	c	d	e	f	g	h	i	j	k	l	m
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
		Disclosure reference date T
		Circular economy (CE)				Pollution (PPC)				Biodiversity and Ecosystems (BIO)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
		Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)				Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling			Of which Use of Proceeds	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%				0.0%				0.0%
2	Assets under management (AuM KPI)	0.0%				0.0%				0.0%
% (compared to total eligible off-balance sheet assets)	aa	ab	ac	ad	ae
---	---	---	---	---	---	---
		Disclosure reference date T
TOTAL (CCM + CCA + WTR + CE + PPC + BIO)
Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-eligible)
Proportion of total covered assets funding taxonomy relevant sectors (Taxonomy-aligned)
		Of which Use of Proceeds	Of which transitional	Of which enabling
1	Financial guarantees (FinGuar KPI)	0.0%	0.0%	0.0%	0.0%	0.0%
2	Assets under management (AuM KPI)	0.0%	0.0%	0.0%	0.0%	0.0%

KFW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Templates for nuclear and fossil gas-related activities

Templates based on stock figures

Nuclear and fossil gas related activities

Row	Nuclear energy related activities
1.	The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.
2.	The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies.
3.	The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.
	Fossil gas related activities
4.	The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.
5.	The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels.
6.	The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels.

Taxonomy-aligned economic activities (denominator) - Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	12	0.0%	12	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	819	0.2%	818	0.2%	1	0.0%
8.	Total applicable KPI	832	0.2%	831	0.2%	1	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

2. Taxonomy-aligned economic activities (denominator) – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	2	0.0%	2	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	10	0.0%	10	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%	1	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	927	0.2%	925	0.2%	1	0.0%
8.	Total applicable KPI	939	0.2%	938	0.2%	1	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

3. Taxonomy-aligned economic activities (numerator) – Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	12	1.5%	12	1.5%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	819	98.5%	818	98.4%	1	0.1%
8.	Total amount and proportion of taxonomy-aligned economic activities in the numerator of the applicable KPI	832	100.0%	831	99.9%	1	0.1%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

3. Taxonomy-aligned economic activities (numerator) – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	2	0.2%	2	0.2%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	10	1.0%	10	1.0%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	1	0.1%	1	0.1%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	927	98.7%	925	98.5%	1	0.1%
8.	Total amount and proportion of taxonomy-aligned economic activities in the numerator of the applicable KPI	939	100.0%	938	99.9%	1	0.1%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Taxonomy-eligible but not taxonomy-aligned economic activities – Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	14	0.0%	14	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	4	0.0%	4	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	15	0.0%	15	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%	1	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	9,634	2.1%	9,588	2.1%	46	0.0%
8.	Total amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	9,668	2.1%	9,622	2.1%	46	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Taxonomy-eligible but not taxonomy-aligned economic activities – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%	1	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	16	0.0%	16	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	9,515	2.1%	9,467	2.1%	48	0.0%
8.	Total amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	9,532	2.1%	9,484	2.1%	48	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

5. Taxonomy non-eligible economic activities – Turnover

Row	Economic activities	Amount (Mn EUR)	%
1.	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5	0.0%
2.	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
3.	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
4.	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
5.	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
6.	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5	0.0%
7.	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	449,429	97.7%
8.	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	449,439	97.7%

5. Taxonomy non-eligible economic activities – Capital expenditure

Row	Economic activities	Amount (Mn EUR)	%
1.	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
2.	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%
3.	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
4.	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
5.	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
6.	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
7.	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	449,465	97.7%
8.	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	449,466	97.7%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Templates based on flows

1. Nuclear and fossil gas related activities

Row	Nuclear energy related activities
1.	The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.
2.	The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies.
3.	The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.
	Fossil gas related activities
4.	The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.
5.	The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels.
6.	The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels.

2. Taxonomy-aligned economic activities (denominator) - Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	6	0.0%	6	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	346	0.1%	346	0.1%	0	0.0%
8.	Total applicable KPI	352	0.1%	352	0.1%	0	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

2. Taxonomy-aligned economic activities (denominator) – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	2	0.0%	2	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	4	0.0%	4	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	440	0.1%	440	0.1%	0	0.0%
8.	Total applicable KPI	446	0.1%	445	0.1%	0	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

3. Taxonomy-aligned economic activities (numerator) – Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	6	1.6%	6	1.6%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	346	98.4%	346	98.3%	0	0.1%
8.	Total amount and proportion of taxonomy-aligned economic activities in the numerator of the applicable KPI	352	100.0%	352	99.9%	0	0.1%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

3. Taxonomy-aligned economic activities (numerator) – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	2	0.4%	2	0.4%	0	0.0%
3.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	4	0.9%	4	0.9%	0	0.0%
4.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the numerator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the numerator of the applicable KPI	440	98.8%	440	98.7%	0	0.1%
8.	Total amount and proportion of taxonomy-aligned economic activities in the numerator of the applicable KPI	446	100.0%	445	99.9%	0	0.1%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Taxonomy-eligible but not taxonomy-aligned economic activities – Turnover

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%	1	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	1	0.0%	1	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	9,665	2.1%	9,619	2.1%	46	0.0%
8.	Total amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	9,668	2.1%	9,622	2.1%	46	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Taxonomy-eligible but not taxonomy-aligned economic activities – Capital expenditure

Row	Economic activities	Amount and proportion (the information is to be presented in monetary amounts and as percentages)
		CCM + CCA		Climate change mitigation (CCM)		Climate change adaptation (CCA)
		Amount (Mn EUR)	%	Amount (Mn EUR)	%	Amount (Mn EUR)	%
1.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
2.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
3.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
4.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
5.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	2	0.0%	2	0.0%	0	0.0%
6.	Amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activity referred to in Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%	0	0.0%	0	0.0%
7.	Amount and proportion of other taxonomy-eligible but not taxonomy-aligned economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	9,530	2.1%	9,482	2.1%	48	0.0%
8.	Total amount and proportion of taxonomy-eligible but not taxonomy-aligned economic activities in the denominator of the applicable KPI	9,532	2.1%	9,484	2.1%	48	0.0%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

5. Taxonomy non-eligible economic activities – Turnover

Row	Economic activities	Amount (Mn EUR)	%
1.	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5	0.0%
2.	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
3.	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
4.	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
5.	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
6.	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	5	0.0%
7.	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	449,429	97.7%
8.	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	449,439	97.7%

5. Taxonomy non-eligible economic activities – Capital expenditure

Row	Economic activities	Amount (Mn EUR)	%
1.	Amount and proportion of economic activity referred to in row 1 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.26 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
2.	Amount and proportion of economic activity referred to in row 2 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.27 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
3.	Amount and proportion of economic activity referred to in row 3 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.28 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
4.	Amount and proportion of economic activity referred to in row 4 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.29 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
5.	Amount and proportion of economic activity referred to in row 5 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.30 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
6.	Amount and proportion of economic activity referred to in row 6 of Template 1 that is taxonomy-non-eligible in accordance with Section 4.31 of Annexes I and II to Delegated Regulation 2021/2139 in the denominator of the applicable KPI	0	0.0%
7.	Amount and proportion of other taxonomy-non-eligible economic activities not referred to in rows 1 to 6 above in the denominator of the applicable KPI	449,465	97.7%
8.	Total amount and proportion of taxonomy-non-eligible economic activities in the denominator of the applicable KPI	449,466	97.7%

KfW Financial Report 2024

Financial Report > Combined non-financial report > Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Templates based on stock figures – financial guarantees (off-balance sheet)

Nuclear and fossil gas related activities

Row	Nuclear energy related activities
1.	The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the fuel cycle.	No
2.	The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations to produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production, as well as their safety upgrades, using best available technologies.	No
3.	The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen production from nuclear energy, as well as their safety upgrades.	No
	Fossil gas related activities
4.	The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities that produce electricity using fossil gaseous fuels.	No
5.	The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/cool and power generation facilities using fossil gaseous fuels.	No
6.	The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation facilities that produce heat/cool using fossil gaseous fuels.	No

KfW Financial Report 2024

Independent auditor's assurance report¹)

ASSURANCE REPORT OF THE INDEPENDENT GERMAN PUBLIC AUDITOR ON A LIMITED ASSURANCE ENGAGEMENT IN RELATION TO THE COMBINED NON-FINANCIAL REPORT OF KFW AS THE PARENT COMPANY AND OF KFW GROUP

To Kreditanstalt für Wiederaufbau Anstalt des öffentlichen Rechts, Frankfurt am Main/Germany

Assurance Conclusion

We have conducted a limited assurance engagement on the separate combined non-financial report of KfW as the parent company and of KfW Group, Frankfurt am Main/Germany, for the financial year from 1 January to 31 December 2024 (hereafter referred to as "the sustainability report"). The sustainability report was prepared to fulfil the requirements of Directive (EU) 2022/2464 of the European Parliament and of the Council of 14 December 2022 (Corporate Sustainability Reporting Directive, CSRD) and Article 8 of Regulation (EU) 2020/852 and Sections 289b to 289e, 315b and 315c German Commercial Code (HGB) for a combined non-financial statement.

The parts of the sustainability report marked as unassured are not subject to our assurance engagement.

Based on the procedures performed and the evidence obtained, nothing has come to our attention that causes us to believe that the sustainability report is not prepared, in all material respects, in accordance with the requirements of the CSRD and Article 8 of Regulation (EU) 2020/852, Sections 289b to 289e, 315b and 315c HGB for a combined non-financial statement, and the specifying criteria presented by the executive directors of the Company. This assurance conclusion includes that nothing has come to our attention that causes us to believe

that the consolidated sustainability statement included in the accompanying sustainability report does not comply, in all material respects, with the European Sustainability Reporting Standards (ESRS), including that the process carried out by the entity to identify information to be included in the consolidated sustainability statement (the materiality assessment) is not, in all material respects, in accordance with the description set out in section "General information" of the sustainability report, or
that the "Disclosures in accordance with Article 8 of the EU Taxonomy" in the sustainability report do not comply, in all material respects, with Article 8 of Regulation (EU) 2020/852.

We do not express an assurance conclusion on the parts of the sustainability report marked as unassured.

Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (DTTL), its global network of member firms, and their related entities (collectively, the "Deloitte organization"). DTTL (also referred to as "Deloitte Global") and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL does not provide services to clients. Please see www.deloitte.com/de/UeberUns to learn more.

¹) Translation of the independent auditor's assurance report issued in German language on the combined non-financial report prepared in German language by the Executive Board of KfW, Frankfurt am Main. The German version prevails.

KfW Financial Report 2024

Basis for the Assurance Conclusion

We conducted our assurance engagement in accordance with the International Standard on Assurance Engagements (ISAE) 3000 (Revised): "Assurance Engagements Other Than Audits or Reviews of Historical Financial Information", issued by the International Auditing and Assurance Standards Board (IAASB).

The procedures performed in a limited assurance engagement vary in nature and timing from, and are less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance obtained is substantially lower than the assurance that would have been obtained had a reasonable assurance engagement been performed.

Our responsibilities under ISAE 3000 (Revised) are further described in section "German Public Auditor's Responsibilities for the Assurance Engagement on the Sustainability Report".

We are independent of the entity in accordance with the requirements of European law and German commercial and professional law, and we have fulfilled our other German professional responsibilities in accordance with these requirements. Our audit firm has applied the requirements of the IDW Quality Management Standards. We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our assurance conclusion.

Emphasis of Matter – Principles of Preparation of the Sustainability Report

Without modifying our conclusion, we draw attention to the details provided in the sustainability report, which describe the principles of preparation of the consolidated non-financial reporting. According to these principles, the Company has applied the European Sustainability Reporting Standards (ESRS) to the extent described in section "General information" of the sustainability report.

Responsibilities of the Executive Directors and the Supervisory Board for the Sustainability Report

The executive directors are responsible for the preparation of the sustainability report in accordance with the requirements of the CSRD and the applicable German legal and other European requirements as well as with the specifying criteria presented by the executive directors of the Company and for designing, implementing and maintaining such internal control as they have considered necessary to enable the preparation of a sustainability report in accordance with these requirements that is free from material misstatement, whether due to fraud (i.e. fraudulent reporting in the sustainability report) or error.

This responsibility of the executive directors includes establishing and maintaining the materiality assessment process, selecting and applying appropriate reporting policies for preparing the sustainability report as well as making assumptions and estimates and ascertaining forward-looking information for individual sustainability-related disclosures.

The supervisory board is responsible for overseeing the process for the preparation of the sustainability report.

Inherent Limitations in Preparing the Sustainability Report

The CSRD and the applicable German legal and other European requirements contain wording and terms that are subject to considerable interpretation uncertainties and for which no authoritative comprehensive interpretations have yet been published. The executive directors have disclosed interpretations of such wording and terms in the sustainability report. The executive directors are responsible for the reasonableness of these interpretations. As such wording and terms may be interpreted differently by regulators or courts, the legality of measurements or evaluations of the sustainability matters based on these interpretations is uncertain. The quantification of non-financial performance indicators disclosed in the sustainability report is also subject to inherent uncertainties.

These inherent limitations also affect the assurance engagement on the sustainability report.

KfW Financial Report 2024

German Public Auditor's Responsibilities for the Assurance Engagement on the Sustainability Report

Our objective is to express a limited assurance conclusion, based on the assurance engagement we have conducted, on whether any matters have come to our attention that cause us to believe that the sustainability report has not been prepared, in all material respects, in accordance with the CSRD, the applicable German legal and other European requirements and the specifying criteria presented by the executive directors of the Company and to issue an assurance report that includes our assurance conclusion on the sustainability report.

As part of a limited assurance engagement in accordance with ISAE 3000 (Revised), we exercise professional judgement and maintain professional scepticism. We also

obtain an understanding of the process used to prepare the sustainability report, including the materiality assessment process carried out by the entity to identify the disclosures to be reported in the sustainability report.
identify disclosures where a material misstatement due to fraud or error is likely to arise, design and perform procedures to address these disclosures and obtain limited assurance to support the assurance conclusion. The risk of not detecting a material misstatement resulting from fraud is higher than the risk of not detecting a material misstatement resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations or the override of internal control. In addition, the risk of not detecting a material misstatement in information obtained from sources not within the entity's control (value chain information) is ordinarily higher than the risk of not detecting a material misstatement in information obtained from sources within the entity's control, as both the entity's executive directors and we as practitioners are ordinarily subject to restrictions on direct access to the sources of the value chain information.
consider the forward-looking information, including the appropriateness of the underlying assumptions. There is a substantial unavoidable risk that future events will differ materially from the forward-looking information.

Summary of the Procedures Performed by the German Public Auditor

A limited assurance engagement involves the performance of procedures to obtain evidence about the sustainability information. The nature, timing and extent of the selected procedures are subject to our professional judgement.

In performing our limited assurance engagement, we

evaluated the suitability of the criteria as a whole presented by the executive directors in the sustainability report.
inquired of the executive directors and relevant employees involved in the preparation of the sustainability report about the preparation process, including the materiality assessment process carried out by the entity to identify the disclosures to be reported in the sustainability report, and about the internal controls related to this process.
evaluated the reporting policies used by the executive directors to prepare the sustainability report.
evaluated the reasonableness of the estimates and related information provided by the executive directors. If, in accordance with the ESRS, the executive directors estimate the value chain information to be reported for a case in which the executive directors are unable to obtain the information from the value chain despite making reasonable efforts, our assurance engagement is limited to evaluating whether the executive directors have undertaken these estimates in accordance with the ESRS and assessing the reasonableness of these estimates, but does not include identifying information in the value chain that the executive directors were unable to obtain.

KfW Financial Report 2024

performed analytical procedures or tests of details and made inquiries in relation to selected information in the sustainability report.
considered the presentation of the information in the sustainability report.
considered the process for identifying taxonomy-eligible and taxonomy-aligned economic activities and the corresponding disclosures in the sustainability report.

Restriction of Use

We issue this report as stipulated in the engagement letter agreed with the Company (including the "General Engagement Terms for Wirtschaftsprüferinnen, Wirtschaftsprüfer and Wirtschaftsprüfungsgesellschaften (German Public Auditors and Public Audit Firms)" dated 1 January 2024 of the Institut der Wirtschaftsprüfer (IDW)). We draw attention to the fact that the assurance engagement was conducted for the Company's purposes and that the report is intended solely to inform the Company about the result of the assurance engagement. Consequently, it may not be suitable for any other than the aforementioned purpose. Accordingly, the report is not intended to be used by third parties as a basis for making (financial) decisions.

Our responsibility is to KfW alone. We do not accept any responsibility to third parties. Our assurance conclusion is not modified in this respect.

Frankfurt am Main/Germany, 11 March 2025

Deloitte GmbH

Wirtschaftsprüfungsgesellschaft

Signed:
Prof. Dr Carl-Friedrich Leuschner
Wirtschaftsprüfer
(German Public Auditor)

Signed:
Christian Schweitzer
Wirtschaftsprüfer
(German Public Auditor)

KfW Financial Report 2024

Combined management report

Financial Report > Combined Management Report

Basic information on KfW Group

187
- KfW's business model 187
- Group structure 189
- Strategic objectives 2029 190
- Internal management system 191
- Alternative key financial figures used 193

Economic report

195
- General economic environment 195
- Development of KfW Group 197
- Development of the KfW Group earnings position 201
- Development of net assets of KfW Group 205
- Development of the KfW Group financial position 207

Risk report

209
- Overview of key indicators 209
- Current developments 211
- Basic principles and objectives of risk management 212
- Organisation of risk management and monitoring 212
- Risk management approach of KfW Group (overview) 215
- Types of risk 221
- Additional internal control procedures 237

Forecast and opportunity report

239
- General economic environment and development trends 239
- New business projections 241
- Funding projections 245
- Earnings projections 245
- Overall conclusion 245

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

246
- Development of KfW 246
- Development of earnings position 246
- Development of net assets 249
- Development of financial position 250

Declaration of compliance

252

Non-financial statements of KfW Group

252

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

Basic information on KfW Group

The KfW management report is combined with the group's management report in accordance with Section 315 (5) in conjunction with Section 298 (2) of the German Commercial Code (Handelsgesetzbuch – "HGB"). The combined management report is included in the KfW Group financial report and is submitted to the German Company Register for publication.

The KfW annual financial statements prepared in accordance with the German Commercial Code and the group financial report are also available online at www.kfw.de.

Information on KfW as the parent company can be found under a separate section, "Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code".

The KfW consolidated financial statements were prepared in accordance with the provisions of Section 315e HGB in conjunction with the International Financial Reporting Standards ("IFRS") as applicable within the European Union. With the exception of the HGB information in the section "Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code", all financial figures in this combined management report, including the comparative figures for the previous year, are reported in accordance with IFRS.

KfW's business model

KfW is a promotional bank of the Federal Republic of Germany in the legal form of a public-law institution. The Federal Government owns 80% of KfW's share capital (37 percentage points of which are attributable to the ERP Special Fund) and the German federal states own the remaining 20%. KfW is subject to the Law Concerning KfW (KfW-Gesetz – "KfW Law"), which defines its functions and sets out the requirements for KfW's operating activities. This set of functions is defined in Article 2 of the KfW Law and represents the implementation of Understanding II, which was reached with the European Commission. KfW's functions include the carrying out of promotional business, related transactions and mandated transactions. Because of its special business model, comparing KfW with commercial banks is only possible to a very limited extent.

KfW's primary and core statutory objective is its promotional business, in accordance with Article 2 (1) of the KfW Law. It consists of promotional measures, particularly in the form of financing for SMEs, the liberal professions and business start-ups, venture capital, housing, environmental protection, infrastructure, technical progress and innovation, internationally agreed promotional programmes and development cooperation. The promotional business also involves financing regional and local authorities and special-purpose associations under public law (öffentlich-rechtliche Zweckverbände), measures with purely social objectives and for the promotion of education. Moreover, project financing is part of KfW's promotional business, insofar as it is co-financed by European financing institutions in the interest of the European Community, as well as export financing outside the European Union ("EU")/European Economic Area ("EEA") or in countries with official status as candidates for EU accession, provided that such funding is carried out on a syndicated basis or that there is insufficient financing available in the relevant countries.

A significant portion of promotion, particularly in the areas of SMEs, start-ups, venture capital, technical progress and innovation, is covered by ERP promotion carried out by KfW. The ERP Special Fund contributed funds to KfW's equity, which was recognised under the Capital reserve as ERP promotional reserves. ERP promotion is executed based on the approaches in the annual ERP Economic Planning Acts (ERP-Wirtschaftsplangesetz). The ERP Special Fund is the largest shareholder based on KfW's total capital ratio, due to the contributed ERP promotional reserves.

Where these operations are directly related to the fulfilment of its promotional tasks, KfW may also conduct additional transactions in accordance with Article 2 (3) of the KfW Law (related transactions). These include KfW's refinancing and treasury management measures as well as refinancing of KfW IPEX-Bank GmbH ("KfW IPEX-Bank") in line with market conditions. KfW may only engage in other transactions if these are expressly mandated by the German Federal Government on a case-by-case basis if there is a public interest in accordance with Article 2 (4) of the KfW Law (mandated transactions). Pursuant to Article 2 (3) sentence 3

KfW Financial Report 2024

of the KfW Law, KfW is expressly prohibited from engaging in financial commission business and deposit business with the general public; therefore, KfW refinances its lending business via the capital markets, primarily by issuing bonds.

In structuring its business activities, KfW follows the principle of subsidiarity and functions as a countercyclical bank offering structure and stability. It is therefore primarily active in the areas where market mechanisms alone would lead to socially or economically disadvantageous results. KfW's offering is designed to avoid distorting the market. Generating a profit is merely a secondary objective to ensuring risk-bearing capacity and carrying out statutorily mandated tasks. KfW's business model as a promotional bank without a primary profit-making objective and without a trading book is a key factor in its fundamentally conservative risk culture and balance sheet structure.

In accordance with the retention requirement (Article 10 (1) of the KfW Law), there is no distribution of net profit to KfW shareholders. The annual net profit resulting after depreciation, amortisation and provisions is to be allocated to a statutory reserve. These funds are available to strengthen the binding regulatory capital ratios and can be re-deployed for promotional purposes subject to these ratios being met. This means that the funds remain in the promotional cycle.

In carrying out its transactions, KfW is subject to the requirement of competitive neutrality in cooperating with commercial banks. The remit as defined in the KfW Law in implementation of Understanding II reached with the European Commission ensures that KfW does not enter into significant competition with commercial banks. An on-lending principle is generally applied in the core domestic promotional business areas (Article 3 (1) of the KfW Law). Derogations therefrom may be made with approval of the Board of Supervisory Directors. The on-lending principle means that credit institutions or other financing institutions are involved in granting financing, enabling final borrowers to receive KfW loans in the legal form of loans from their own primary bank, which in turn refinances such operations via KfW. Therefore, KfW does not need to operate a branch network to sell its products. The on-lending principle applies exclusively in the promotional areas pursuant to Article 2 (1) no. 1a to f of the KfW Law, with the particular exception of financing for municipalities, for purely social purposes and for education.

Funding on the money and capital markets has a material impact on the group's business activities. KfW's creditworthiness as assessed by rating agencies is key to its funding conditions. Based on what is referred to as institutional liability (Anstaltslast), the Federal Republic of Germany is obliged to safeguard or maintain KfW's economic basis, thereby ensuring KfW's ability to function. In addition to the institutional liability, it is necessary to mention the comprehensive liability of the German Federal Government under Article 1a of the KfW Law, which extends to loans taken out and bonds issued by KfW, forward transactions structured as fixed transactions, rights conferred by options and other loans to KfW, and loans to third parties insofar as they are expressly guaranteed by KfW. As a result, KfW is ranked by rating agencies as having excellent credit quality (triple-A rating). The resulting funding conditions support KfW's operating activities in setting promotional incentives.

The federal guarantee and its ownership structure mean that KfW is designated as a public sector entity pursuant to Article 4 (1) no. 8 CRR. This enables utilisation of the exemption under Article 116 (4) CRR, by which creditors of exposures to KfW can apply a risk weight of 0% to an instrument covered by the federal guarantee.

KfW is subject to legal supervision by the Federal Government exercised by the Federal Ministry of Finance in consultation with the Federal Ministry for Economic Affairs and Climate Action. As a public-law institution, KfW is subject to regular audits by the Federal Audit Office. With regard to compliance with the applicable provisions of the German Banking Act (Kreditwesengesetz - "KWG") applicable in accordance with the KfW Regulation, KfW is subject to supervision by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht - "BaFin") and the Bundesbank. However, KfW is neither a credit institution nor a financial services institution within the meaning of the KWG nor a credit institution within the meaning of CRD V.

The group lends material support to the transformation of the economy and society towards a greenhouse gas-neutral future. KfW presents its broad statutory mandate as part of the KfWplus transformation agenda with the concept of "Promoting transformation – boosting resilience", and largely aligns its promotional

Financial Report > Combined Management Report > Basic information on KfW Group

activities – with a focus on domestic promotion – to the key social megatrends “climate change and environment” and “digitalisation and innovation”. KfW also continues to promote the megatrends “globalisation” and “social change”. To ensure a sustainable impact, KfW endeavours to strike a balance in the economic, environmental and social dimensions of sustainability in all promotional areas.

Group structure

In line with its products and services, KfW Group is divided into the following business sectors: Mittelstandsbank & Private Kunden (SME Bank & Private Clients), Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients), KfW Capital, KfW Development Bank, DEG, Export and project finance, Financial markets and Head office, to which the main products and services are attributed as follows:

| Mittelstandsbank & Private Kunden (SME Bank & Private Clients) | - Start-up financing
- Financing of general corporate investments and investments in innovation, energy and environmental protection
- Education financing
- Financing for housing construction, conversion and refurbishment |
| --- | --- |
| Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) | - Financing of municipal and social infrastructure
- Customised corporate financing with equity and debt capital
- Customised financing of banks and promotional institutions of the federal states (“LFI”)
- Mandated transactions for energy suppliers (debt capital) |
| KfW Capital | - Investments in German and European venture capital and venture debt funds |
| Export and project finance | - Financing of German and European export activities
- Financing of projects and investments which are of special interest for Germany and Europe |
| KfW Development Bank | - Promotion of developing countries and emerging economies on behalf of the Federal Government with budget funds and complementary market funds raised by KfW |
| DEG | - Financing provided by DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH in developing countries and emerging economies (private enterprise financing) |
| Financial markets | - Securities and money market investments
- Holding arrangements for the Federal Republic of Germany
- Transactions mandated by the Federal Government, loan granted to Greece
- Funding |
| Head office | - Central interest rate and currency management
- Strategic equity investments |

In addition to KfW (that is, the business sectors Mittelstandsbank & Private Kunden (SME Bank & Private Clients), Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients), KfW Development Bank, Financial markets and Head office), the group includes six consolidated subsidiaries. The main operational subsidiaries are KfW IPEX-Bank (responsible for the business sector Export and project finance), DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH (DEG) and KfW Capital GmbH & Co. KG (KfW Capital).

KfW IPEX-Bank addresses the global lending business in Export and project finance that is not part of KfW's promotional activities and that is subject to competition in the financial services sector. In addition to its own market business, KfW IPEX-Bank manages the fiduciary business conducted on behalf of and for the account of KfW under an agency agreement. KfW IPEX-Bank is subject to the KWG and banking supervisory regulations. In light of its total assets exceeding EUR 30 billion and its classification as a significant entity, it will likely undergo a change of supervisor from BaFin and the Bundesbank to the ECB.

DEG is one of the largest European development finance institutions for long-term financing in the private sectors of developing countries and emerging economies. DEG operates alongside other financial institutions and provides funding to companies where funding is not offered by the market at all, or not to a sufficient

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

degree. With its financing and advisory services focused on impact and/or the climate, DEG promotes sustainable local development and thereby contributes to the UN's Sustainable Development Goals ("SDGs") and the goals of the Paris Agreement on climate change.

KfW Capital, represented by KfW Capital Verwaltungs GmbH, is responsible for equity financing as part of the domestic promotional business. KfW Capital invests in venture capital and venture debt funds, which in turn invest in innovative technology-orientated companies in the start-up and growth phases, with activities focused in Germany and Europe, thereby strengthening these companies' capital base. In addition to its own market business conducted at its own risk, KfW Capital manages Federal Government funds on a fiduciary basis. KfW Capital also functions as KfW's agent for KfW's equity investments in funds, which it enters into on a fiduciary basis in the context of the Future Fund for the Federal Government.

Composition of KfW Group Total assets (IFRS, before consolidation)

	Total assets as of 31 Dec. 2024	Total assets as of 31 Dec. 2023
	EUR in millions	EUR in millions
KfW, Frankfurt am Main, Germany	540,309	555,731
Subsidiaries
KfW IPEX-Bank GmbH, Frankfurt am Main, Germany	38,337	32,797
DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH, Cologne, Germany	9,156	8,290
KfW Beteiligungsholding GmbH, Frankfurt am Main, Germany	3,521	3,194
KfW Capital GmbH & Co. KG, Frankfurt am Main, Germany	1,287	1,024
Interkonnektor GmbH, Frankfurt am Main, Germany	249	284
KfW IPEX-Bank Asia Ltd., Singapore (IPEX Asia)	16	15
Investments accounted for using the equity method	Total assets as of 30 Sep. 2024	Total assets as of 30 Sep. 2023
Green for Growth Fund, Southeast Europe S.A., Luxembourg (11.2%), Luxembourg	1,093	808
coparion GmbH & Co. KG, Cologne (16.4%), Germany	345	362
	31 Dec. 2024	31 Dec. 2023
DC Nordseekabel GmbH & Co. KG, Bayreuth (50.0%), Germany	802	856

The development of the group's operating income is driven by KfW.

Strategic objectives 2029

KfWplus is the group's strategic transformation agenda, which serves KfW as the basis for realising its goal of becoming the leading digital transformation and promotional bank. The strategic objectives are consistent with KfWplus and implement the control components, which are intended to enable comprehensive control and the achievement of targets. To this end, the strategic objectives define KfW's targeted medium-term positioning. This strategic framework encompasses top-level objectives at group level and serves as a central and binding reference for the strategic orientation of all business sectors, with a five-year horizon. The strategic objectives for 2029 were adopted in 2024.

KfW's primary objective, or purpose, is sustainable promotion, which means KfW aims to transform the economy and society to improve economic, environmental and social living conditions around the world. This primary objective is supported by the two promotional principles of subsidiarity and sustainability.

Subsidiarity means that KfW focuses on compensating for market weaknesses. Putting this principle into practice, KfW Group strives to maintain high-quality promotional activities and to mobilise private capital, to ensure that the goal of transforming the economy and society is achieved.

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

With regard to the principle of sustainability, KfW aims to achieve a ranking among the top three in a "best of the best" group of KfW peers, which comprises the ten national and international promotional and development banks with the best ESG ratings from the agencies relevant to KfW (Sustainalytics, ISS ESG, MSCI). In addition, the contributions of KfW's financing activities to the UN's Sustainable Development Goals ("SDGs") and to 1.5°C compatibility are monitored as part of fulfilling the climate goals. The group-wide Paris-compatible sector guidelines serve as a key internal steering instrument for ensuring the 1.5°C compatibility of new financing.

Within the framework of these promotional principles, KfW finances projects under the motto "promoting transformation – boosting resilience" in support of the dual transformation – the key challenge of this decade. This means further expanding the relevant promotional areas, climate change and the environment (environmental share of financing >38%), and digitalisation and innovation (digitalisation and innovation share of financing >10%). Promotional activities linked to globalisation and social change, moreover, continue to be ongoing tasks for KfW. In domestic promotion, KfW still aims to achieve an SME ratio of >40% in financing small and medium-sized German enterprises.

The primary objective, or purpose, is complemented by secondary objectives in the areas of digitalisation, agility and innovation, operating model and governance, and customer and employee centricity, which help to maintain and support a top-performing KfW. The secondary objectives comprise the same focus areas as in the prior year, with emphasis on internal digitalisation and innovation.

Internal management system

KfW Group has an integrated strategy and planning process. Conceived as a group-wide strategy process, group business sector planning is KfW Group's central planning and management tool. Group business sector planning consists of three consecutive sub-processes performed every year: defining objectives, implementation and quality assurance, and finalisation. The overall strategy and planning process includes the collaboration of staff responsible for planning in all areas.

Objectives: The KfWplus transformation agenda and the strategic objectives derived from it, both of which are set by the Executive Board, form the basis for strategic planning. These strategic objectives serve as a stable roadmap for KfW Group, laying out the direction in which KfW Group would like to develop over the next five years. They define KfW Group's medium-term targeted positioning and set top-level objectives for the entire bank. The strategic objectives are reviewed annually for relevance, completeness and aspiration level and are adjusted where necessary – for example, due to changed parameters or newly determined focus areas. Efforts are made, however, to maintain a high degree of consistency to ensure that there are no fundamental changes made to the strategic road map in the course of the annual review. A business strategy scenario analysis is conducted in parallel. A scenario analysis is a "what if" analysis of a specific, plausible scenario, looking at the interaction of exogenous influencing factors and translating the results of the analysis. Such scenarios assist in the process of identifying potential risks and opportunities for promotional targets and KfW Group's profitability and risk-bearing capacity, and enable these factors to be considered in the further planning process, if necessary. Within this strategic framework and the strategic focus areas set by the Executive Board, major medium-term projects relevant throughout the bank (bank backlog projects) are developed in a base case scenario by the market areas of the KfW parent company, and – taking into account their statutory requirements – the subsidiaries (hereinafter business sectors) and the central departments. Assumptions regarding the future development of both relevant external factors (including market development, regulatory requirements, climate policy and climate scenarios, the competitive situation and customer behaviour) and internal factors and resources (including human, technical and organisational resources, promotional expense, primary cost planning and tied-up capital) as well as targeted earnings levels, are made based on a risk and opportunity assessment. Promised benefits (such as project efficiencies) are also considered in business sector planning. This analysis involves an evaluation of the key business and revenue drivers for each group business sector, as well as for the group as a whole. The business sectors are also called upon to address the environmental, social and governance risks ("ESG" risks) resulting from their business activity and new projects. As risk drivers, these can have a considerable impact on the likelihood of occurrence or the extent of typical banking risk types. Although ESG risks primarily affect the lending and equity finance business of KfW Group, they can also potentially give rise to consequential risks, such as reputational risk. The central departments (e.g. information technology, human resources and central services) play important roles in achieving the strategic objectives. By involving these departments, their own strategies are aligned with the strategic objectives. The first regular capital budget in the base case

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

and two adverse cases is prepared on a multi-year horizon on this basis. In this way, any capital bottleneck resulting from strategic considerations or changed parameters can be identified at an early stage and mitigated by resolving and implementing appropriate measures. Based on the strategic focus areas, the Executive Board prioritises all new and ongoing bank backlog projects across the group through the annual business review ("ABR"). With due consideration for this assessment and prioritisation, the Executive Board defines top-down objectives for all business sectors (with regard to promotion, risk and finances) and departments (staffing in the form of full time equivalents ("FTEs") and costs) for the entire planning period.

Implementation and quality assurance: The business sectors plan their new business, risks and earnings, and each department its budgets, and staffing in the form of FTEs, based on the top-down objectives defined by the Executive Board, taking into account any changes in external or internal factors and in close collaboration with Financial and Risk Controlling. These plans are checked for consistency with the objectives of the group and the business sectors/departments. The interest rate forecast plays a key role in shaping KfW Group's earnings position. Hence, both a high and a low interest rate scenario are also examined in addition to the anticipated base case. The plans are also assessed for future risk-bearing capacity in a second round of regular capital budgeting in a base case and two adverse cases over a multi-year horizon.

Finalisation: The Executive Board approves the resulting budget or has plans fine-tuned in a revision round if necessary. In the event of changes to the business strategy, there is consultation with the Risk Controlling department to ensure consistency between the business and risk strategies. The key conclusions from the planning process are incorporated into the business and risk strategies. The management has overall responsibility for formulating and adopting both strategies. The business strategy comprises the group's strategic objectives for its main business activities as well as important internal and external factors, which are included in the strategy process. It also contains the business sectors' contribution to the strategic objectives and the measures for achieving each objective. Moreover, the business strategy combines the budget at the group and business sector levels. The Executive Board sets out KfW Group's risk policies in its risk strategy, which is consistent with the business strategy. The risk strategy is based on the overarching aim of ensuring risk-bearing capacity and liquidity for the long term. Group business sector planning is used to review and redetermine risk appetite. The main risk management approaches are also incorporated into the risk strategy as a basis for operational risk management. The group business sector planning process ends when the Executive Board has adopted a final budget for the entire planning period, including the future capital requirement and the business and risk strategies. The budget is then presented to the supervisory body (Board of Supervisory Directors) for approval, along with the business and risk strategy for discussion. After the Board of Supervisory Directors has decided on the business and risk strategy, it is communicated to the staff in an appropriate manner. On the other hand, the result from the valuation of derivatives, which KfW carries out purely for hedging purposes, is not included in the planning, as it cannot be controlled or planned due to the complex interdependencies affecting the measurement at fair value of derivatives in the context of KfW's refinancing activities. The temporary effects on results from the measurement of such hedging relationships included in the actual figures are recognised separately in internal reporting and the management report as alternative key financial figures.

The adoption of the business sector planning serves as a foundation for the group's qualitative and quantitative objectives. The Executive Board reviews target achievement both on a regular and on an ad hoc basis during each financial year. The assumptions concerning external and internal factors made when determining the business strategy are also subject to regular checks. The development of relevant control variables, their attainment, and the reasons for any shortfalls are analysed as part of strategic management. Strategic assumptions are reviewed, and a systematic variance analysis of early objectives and forecasts is performed at the beginning of every year. Ad hoc issues of strategic relevance are also addressed in consultation with the group's departments, and recommendations for action concerning potential strategy adjustments or optimisation of the use of resources are made to the Executive Board by means of the strategic performance report. The results of the analysis are included in further strategy discussions and strategic planning processes. At mid-year, the integrated forecasting process serves as a comprehensive basis for interim management input on quantitative group variables of strategic importance in line with the strategic objectives (new business, risk and earnings) in respect of funding opportunities, while providing a well-founded guide to achieving planned objectives. The achievement of objectives is regularly monitored by the Board of Supervisory Directors based on reports submitted under the KfW Bylaws. The commentary in these reports outlines analyses of causes and any potential plans for action. Detailed reports are prepared on a monthly or quarterly basis as part of financial controlling. These comprehensive detailed analyses at group and business sector level

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

comprise earnings and cost developments and are reported to specific departments. Additionally, analyses of significant relevance to overall group performance are also presented directly to the Executive Board. Early warning systems have been established and mitigation measures defined for all material risk types and risk-bearing capacity in general in line with the risk management requirements set out in the risk strategy. All controlling and monitoring approaches are integrated into regular risk reporting to the Executive Board. The Board of Supervisory Directors receives a risk report on a quarterly basis.

Alternative key financial figures used

The combined management report contains financial figures that are defined neither in the HGB nor the IFRS accounting standards. In its strategic objectives, KfW uses key indicators prescribed by accounting standards and supervisory regulations as well as key figures that are geared towards promotion as the core business activity. It also uses key figures in which the temporary effects on results determined and reported in the consolidated financial statements in accordance with IFRS, and which KfW does not consider representative, are adjusted.

KfW has defined the following alternative key financial figures:

Promotional business volume

Promotional business volume refers to the commitments of each business sector during the reporting period. In addition to the lending commitments shown in the statement of financial position, promotional business volume comprises loans from Federal Government funds for promotion of developing countries and emerging economies – which are accounted for as trust activities – financial guarantees, equity financing and securities purchases (in the green bonds asset class). Promotional business volume also includes grants committed as part of development aid and in domestic promotional programmes. Allocation to the promotional business volume for the current financial year is generally based on the commitment date of each loan, financial guarantee and grant, and the transaction date of the equity finance and securities transactions. On the other hand, allocation of general funding and global loans to the promotional institutions of the federal states (Landesförderinstitute – “LFI”) and BAföG government loans is based on the individual drawdown volume and date, instead of the total volume of the contract at the time of commitment. In the lending business, financing amounts denominated in foreign currency are converted into euros at the exchange rate on the commitment date, whereas in the securities and equity finance business, the conversion generally occurs at the rate on the transaction date.

See the "Development of KfW Group" economic report or segment reports for a breakdown of promotional business volume by individual segment.

Promotional expense

Promotional expense is understood to mean certain expenses arising in the two business sectors Mittelstandsbank & Privatkunden (SME Bank & Private Clients) and Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) to achieve KfW's promotional objectives.

Interest rate reductions accounted for at present value are the key component of KfW's promotional expenses. KfW grants these reductions for certain domestic promotional loans for new business during the first fixed interest rate period in addition to passing on KfW's favourable refinancing conditions, obtained due to its triple-A rating. The difference between the fair value of these promotional loans and the transaction value during the first fixed interest rate period, due to the interest rate being below the market rate, is recognised in profit or loss as an interest expense and accounted for as an adjustment to the carrying amount under the item Financial assets at amortised cost. In addition, the accumulated interest rate reductions over the fixed interest rate period are recognised through profit or loss in Net interest income (see the relevant notes on KfW's promotional lending business, financial assets at amortised cost, and provisions).

An additional promotional component (in commission expense) comprises the expense paid in the form of upfront fees to sales partners for processing microloans. Promotional expense also contains disposable and product-related marketing and sales expenses (administrative expense), expenses for innovative digital promotional approaches (commission and administrative expense), and promotional grants awarded by KfW since 2023 in the context of ERP promotion (other operating expense).

KfW Financial Report 2024

Financial Report > Combined Management Report > Basic information on KfW Group

Promotional expense included in Interest, Commission and Administrative expense and Other operating expense is reported separately in the internal presentation of the earnings position due to its special relevance as a management variable.

Cost/income ratio (before promotional expense)

The cost/income ratio (before promotional expense) is calculated as administrative expense (excluding promotional expense) in relation to net interest and commission income before promotional expense.

The cost/income ratio ("CIR") reflects costs in relation to income and is thus a measure of efficiency. To enable a comparison of the CIR with other (non-promotional) institutions, an adjustment for the components of KfW's promotional business results is made to the numerator (administrative expense) and denominator (net interest and commission income).

In addition to the CIR, KfW also reports an adjusted CIR, which takes into account KfW's specific business model. Under domestic promotional programmes with expense-based remuneration, as well as for implementation of Financial Cooperation, KfW receives compensation in the amount of the costs incurred, which means that for these products the CIR is almost 100%. In order to ensure comparability of KfW's CIR with that of other financial institutions, the adjusted CIR does not take into account income and expenses related to these products.

Consolidated profit before IFRS effects

Consolidated profit before IFRS effects from hedging is another key financial figure based on Consolidated profit in accordance with IFRS. Derivative financial instruments are entered into for hedging purposes. Under IFRS, the requirements for the recognition and valuation of derivatives and hedges give rise to temporary net gains or losses that are offset over the entire term. In KfW's opinion, such temporary effects on results are not representative due to the economically effective hedging relationships.

Consequently, the following reconciliations are performed by eliminating temporary contributions to profit and loss as follows:

Valuation results from micro and macro hedge accounting.
Net gains or losses from the use of the fair value option to avoid an accounting mismatch in the case of funding including related hedging derivatives.
Net gains or losses from the fair value accounting of hedges with high economic effectiveness but not qualifying for hedge accounting.
Net gains or losses from foreign currency translation of foreign currency positions, in accordance with recognition and valuation requirements for derivatives and hedging relationships.
Net gains or losses from changes to deferred taxes on credit rating-related effects of other derivatives from subsidiaries.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Economic report

General economic environment

Global real domestic product ("GDP") increased by 3.2% in 2024 compared with 2023, according to estimates by the International Monetary Fund ("IMF"). While the growth rate of real GDP in industrialised countries in 2024 remained unchanged year on year, the global rate was lower, as was real GDP growth for developing countries and emerging economies. According to IMF calculations, the annual average rate of global consumer price inflation declined to 5.7% in 2024 from 6.7% in the previous year. The annual average global core inflation rate declined to a greater extent, from 6.0% to 4.7% in that same period. This disinflation was supported by the level of real key interest rates, which are cooling economic activity. As calculated by the Organisation for Economic Co-operation and Development ("OECD") global real GDP increased by 3.3% in the first quarter of 2024 and 3.1% in the second quarter (each year on year), followed by 3.2% in the third quarter. Economic activity in the service sector is stronger than in manufacturing. After global trade volume increased by a mere 0.7% year on year in 2023 according to the IMF, it developed in line with global real GDP in 2024.

Gross domestic product at constant prices

	2024 estimate	2023	2014-2023 average
Year-on-year change in %
Global economy¹⁾	3.2	3.3	3.1
Industrialised countries¹⁾	1.7	1.7	1.9
Developing countries and emerging economies¹⁾	4.2	4.4	4.0

¹⁾ The IMF aggregates the annual growth rates of GDP at constant prices of each country on the basis of the shares of country-specific GDP at purchasing power parities in the corresponding global aggregate to the growth rate of global real GDP, for industrialised countries as well as developing countries and emerging economies. The average is calculated as the geometric mean of annual growth rates.

Euro area economic growth recovered slightly in 2024 from the after-effects of the energy crisis. Price-adjusted GDP rose by 0.7% compared to 2023, after growing by just 0.4% in 2023 (see table below on gross domestic product at constant prices, year-on-year change). Harmonised consumer price inflation averaged 2.4% for the year, significantly lower than in the previous year (5.4%). Private consumption contributed to GDP growth but remained below expectations. Despite the increase in disposable income, higher purchasing power and a sound employment situation, households held back on their consumer spending, preferring to save an increasing proportion of their income. Global economic uncertainty resulting from the conflicts in Ukraine and the Middle East, and concerns about increasing trade fragmentation had a significant negative impact on private consumption and investment activity. Financing conditions were also an obstacle to corporate investment. Although the first ECB interest rate cut in June 2024 signalled an end to the restrictive interest rate policy, financing conditions for businesses were slow to improve. Euro area GDP, by contrast, was positively influenced by the rise in export demand, while imports remained virtually unchanged. The service sector compensated for softening in the industrial sector, which continued to suffer due to high energy prices. The expiry of national support packages for private investment and lower EU budget expenditure resulted in a decline in fiscal policy stimulus.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Gross domestic product at constant prices, year-on-year change

	2024	2023	2014-2023 average	1999-2023 maximum
	in %	in %	in %	in %
Euro area	0.7	0.4	1.5	6.3^{1)}
Germany	-0.2	-0.3	1.1	4.1^{2)}

1) 2021 2) 2010

Despite the global economic developments described above, lower interest rates, and increasing purchasing power of private households as a result of shrinking consumer price inflation, which at 2.2% in 2024 was below the comparative figure for 2023 (+5.9%), GDP in Germany contracted by 0.2% in 2024 compared with the previous year, having previously contracted by 0.3% in 2023 and grown at an annual average of 1.1% over the ten years from 2014 to 2023 (see table above on gross domestic product at constant prices, year-on-year change). Gross capital formation in machinery and equipment (-5.5%) and new buildings (-3.5%) provided negative momentum for the rate of change in GDP in 2024, while household final consumption expenditure (+0.3%), government final consumption expenditure (+2.6%) and gross capital formation in other assets (+3.9%) increased. Overall, domestic use rose by 0.2% in 2024. Net exports weighed on the rate of change in GDP in 2024 to the tune of 0.4 percentage points, with exports contracting (-0.8%) and imports rising (+0.2%). From a production perspective, gross value added in the economic sectors provided both positive and negative impetus for the rate of change in GDP in 2024. The construction industry suffered the largest decline in gross value added (-3.8%), whereas the information and communication technology sector recorded the largest increase (+2.5%). Gross value added in the manufacturing industry, excluding construction, fell by 3.0%, while stagnating in the retail, transport and hospitality sector. The number of persons in employment located in Germany increased by 0.2% year on year in 2024, to 46.1 million.

The rise in headline inflation slowed further in the euro and dollar areas in 2024. Inflation in the second half of the year was already back within the central banks' 2% target range at times, in both currency areas. This was mainly due to a significant year-on-year decline in energy prices, in particular oil prices, which fell despite geopolitical tensions. By contrast, service sector inflation remained pronounced, declining only slightly over the course of the year. In December 2024, the annual inflation rate in the eurozone (rate of change in the Harmonised Index of Consumer Prices) was 2.4%; the annual inflation rate in the United States (rate of change in the Personal Consumption Expenditures Price Index) in the same period was 2.6%.

In view of these developments, the central banks in both currency areas initiated monetary easing. The US Federal Reserve began lowering the federal funds target rate range in September 2024 and reduced it by a total of 100 basis points (bp) to 4.25%–4.5% by the end of the year. The Federal Reserve continued to shrink its balance sheet by trimming assets at a somewhat slower pace in 2024, having begun in 2022.

In June 2024, the European Central Bank ("ECB") decided to lower the deposit facility rate for the first time, by 25 bp. A series of three further rate cuts of the same magnitude followed, putting this, the ECB's most important key rate, at 3% at the end of the year. As part of the review of the monetary policy framework, the interest rate differential between the main refinancing operations and the deposit facility was also narrowed from 50 to 15 bp. The ECB discontinued its asset purchase programmes, the pandemic emergency purchase programme ("PEPP") and the regular asset purchase programme ("APP") in 2022, and started decreasing portfolios again in 2023. Principal payments due under the APP were no longer reinvested in full in 2024, and reinvestments in the PEPP have also been only partial since July 2024. The consequence of these developments was a reduction in total securities held for monetary policy purposes by approximately 9% to EUR 4,290 billion by December 2024, compared to total securities held at the end of 2023. The regular and early repayments of targeted longer-term refinancing operations ("TLTRO III") contributed to the reduction in the ECB's total assets. By the end of December 2024, credit institutions in the euro area had reduced longer-term funds ("LTRO") they had borrowed from the central bank by EUR 380 billion compared to the end of 2023. As a consequence, funds provided under the TLTRO III programme have been repaid in full.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

The trend in swap and money market rates in the eurozone and the United States in 2024 was characterised by the lowering of key interest rates expected by the financial markets, which then materialised. In terms of money market rates, the plateau phase that started with the key interest rate peak in 2023 ended with a downward trend over the course of the year. Adjustments to expectations regarding the start and pace of monetary easing contributed to fluctuations during the year, particularly in longer-term interest rates. On average for the year, key market interest rates were about as high as in the previous year, with upward and downward fluctuations depending on the term and currency area. For instance, the 3-month EURIBOR averaged 3.57% in 2024 (2023: 3.43%); the 5-year EUR swap rate averaged 2.58% (2023: 3.12%); and the yield of the 10-year German government bond stood at 2.34% (2023: 2.46%). In the US, the 3-month SOFR reference rate (CME) was 5.06% on average for the year in 2024, compared with 5.17% in the previous year. The 5-year USD swap rate averaged 3.85% in 2024 (2023: 3.83%), and the yield on 10-year US Treasuries was 4.20% (2023: 3.96%). The yield curves in both currency areas were characterised by a reduction in their marked inversion in 2024, as measured by the spread between ten and two-year swap rates. In 2024, the average EUR swap curve slope was -26 bp (2023: -50 bp), while the US swap curve slope was -45 bp (2023: -87 bp).

Stock markets in the United States and the euro area benefited from declining interest rates over the course of the year. Despite economic weakness in Europe and Germany, share prices also rose on domestic stock exchanges throughout 2024. At 19,909 points, Germany's leading DAX index registered 19% higher at the end of 2024 than at the end of 2023. At 5,880 points, the key US index, the S&P 500, achieved even greater growth of 23%.

Development of KfW Group

The group recorded a very strong promotional year again in 2024, with promotional volume of EUR 112.8 billion slightly exceeding the EUR 111.3 billion of the previous year.

The earnings position in 2024 was highly satisfactory despite the persistent challenging geopolitical and macroeconomic environment. Consolidated profit stood at EUR 1.4 billion thanks to the strong operating result, and was considerably above expectations but below the prior-year result of EUR 1.6 billion. Consolidated profit before IFRS from hedging of around EUR 1.4 billion was on par with the prior-year level. In addition to the strong operating result of EUR 1.9 billion (2023: EUR 1.8 billion), buoyed by higher net interest and commission income, this development was largely attributable to an unchanged positive valuation result of EUR 0.2 billion (2023: EUR 0.3 billion). Overall, KfW Group generated a consolidated profit before IFRS effects from hedging, promotional expense and taxes, of EUR 2.1 billion in 2024, a EUR 0.2 billion increase compared with the previous year. This enabled KfW to increase its promotional expense to EUR 0.5 billion in 2024 (2023: EUR 0.4 billion), the highest figure in the last ten years. At the same time, tax expense increased by EUR 0.1 billion to EUR 0.2 billion.

Consolidated total assets decreased by EUR 15.4 billion to EUR 545.4 billion in financial year 2024. This was mainly due to a EUR 17.8 billion reduction in liquidity holdings and the EUR 8.1 billion decrease in Net loans and advances to EUR 440.1 billion, primarily as a result of repayments under the coronavirus special programme 2020. This was offset by a market price-induced increase of EUR 5.4 billion in value adjustments from macro hedge accounting. The volume of own issues reported under Certified liabilities amounted to EUR 455.5 billion (31 Dec. 2023: EUR 452.2 billion). The EUR 1.5 billion increase in equity to EUR 39.6 billion resulted mainly from the consolidated profit, which amounted to EUR 1.4 billion.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Business performance in 2024 was largely characterised by the following developments:

A. Demand for KfW products slightly higher than in previous year

The group recorded another very strong promotional year in 2024 with new commitments totalling EUR 112.8 billion (2023: EUR 111.3 billion).

Domestic promotional business recorded a slight increase to EUR 79.0 billion (2023: EUR 77.1 billion), of which EUR 8.3 billion was attributable to ERP promotional business. In the business sector Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients), promotional business volume rose from EUR 35.9 billion to EUR 41.6 billion, which was mainly attributable to two mandated transactions to assist in developing the national hydrogen core network and to secure the energy supply. By contrast, new business volume in the business sector Mittelstandsbank & Private Kunden (SME Bank and Private Clients) fell from EUR 39.1 billion to EUR 35.8 billion. The decline particularly affected the Mittelstandsbank (SME Bank), where persistently weak economic environment and state aid requirements with a high EU reference rate had a negative impact on business. This led to a decrease in the volume of promotional business to EUR 13.4 billion (2023: EUR 20.4 billion). On the other hand, positive performance was recorded in business with private clients, rising from EUR 18.8 billion to EUR 22.4 billion, particularly in the key promotional areas energy efficiency, renewable energy and homes and living. The subsidiary KfW Capital recorded new business volume totalling EUR 1.6 billion in 2024 (2023: EUR 2.1 billion). The high volume in the prior-year period was mainly the result of more intensive commitment activity as part of the German Future Fund ("GFF") EIF Growth Facility programme, which is managed on a fiduciary basis for the Federal Government.

International business commitments declined slightly in financial year 2024 to a promotional business volume of EUR 34.2 billion (2023: EUR 35.1 billion). New commitments totalling EUR 23.9 billion put the business sector Export and project finance close to the previous year's record figure of EUR 24.2 billion. Commitments in the business sector KfW Development Bank dropped slightly from EUR 9.0 billion to EUR 7.8 billion. Despite persistent globally challenging conditions, DEG recorded commitments totalling EUR 2.5 billion, a sizeable increase in new business over the previous year, which at EUR 1.9 billion was already high.

The development of new business volume in 2024 affected the most important non-financial performance indicators relevant to management, i.e. the SME and environmental shares of financing, in different ways. At 35%, the group-level SME share of financing was below the target of the strategic objectives (>40%) and below the prior-year figure of 46%. At the same time, the environmental share of 44% in 2024 exceeded the target of the strategic objectives (>38%) and almost reached the same level as the prior year (45%).

KfW raised a volume of EUR 78.1 billion in the capital markets to fund its business activities in 2024 (2023: EUR 90.2 billion).

Promotional business volume of KfW Group

	2024	2023
	EUR in billions	EUR in billions
Domestic business	79.0	77.1
Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	35.8	39.1
Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	41.6	35.9
KfW Capital	1.6	2.1
Financial markets	0.0	0.5
International business	34.2	35.1
Export and project finance	23.9	24.2
KfW Development Bank	7.8	9.0
DEG	2.5	1.9
Volume of new commitments¹)	112.8	111.3

¹) Adjusted for export and project financing refinanced through KfW programme loans.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

B. Operating result exceeds high prior-year figure

The operating result before valuation and promotional expense rose by 7% to EUR 1,917 million compared to the previous year (EUR 1,797 million) and exceeded the target by 9% (EUR 1,758 million). This positive development was primarily due to net interest income, which, at EUR 2,900 million, exceeded the target (EUR 2,719 million) by 7%, and represented the group's main source of income. Net interest income benefited from higher borrowings and a higher return on equity. At EUR 675 million (2023: EUR 606 million), net commission income (before promotional expense) was 11% above the previous year and 4% higher than projected (EUR 651 million). By contrast, administrative expense before promotional expense rose by EUR 111 million to EUR 1,658 million, exceeding the planned ceiling by EUR 46 million. This rise was largely the result of inflation-related cost increases and a growing number of employees. The total cost/income ratio before promotional expense of 46.4% was close to that of the previous year (46.3%).

C. Positive risk provision result

Despite the persistent uncertainties in the geopolitical and macroeconomic environment, risk provisions for lending business resulted in overall net income of EUR 39 million in 2024, compared with EUR 165 million the previous year. The risk provision result was therefore significantly better than the projected standard risk costs (EUR -495 million). This result benefited from the unchanged favourable risk situation in KfW's lending book, which was reflected in particular in the net reversals of provisions for latent risks (stage 1 and 2) for loans totalling EUR 51 million (2023: EUR 172 million). In addition, net expense for non-performing loans (stage 3), at EUR 50 million, was lower than in the previous year (EUR 72 million) and was largely offset by income from recoveries of loans written off, totalling EUR 43 million (2023: EUR 66 million).

D. Positive valuation result from equity investment portfolio

The group generated income totalling EUR 149 million from the valuation of the equity investment portfolio in financial year 2024, in contrast to charges totalling EUR 101 million in the previous year. This positive result was largely due to DEG's equity investment portfolio, which recorded a valuation result of EUR 81 million, following charges of EUR 80 million in the previous year. A net loss from securities of EUR 53 million was more than offset by positive effects from foreign currency translation. KfW Capital contributed a positive valuation result of EUR 31 million, following charges of EUR 92 million in the previous year. The business sectors Export and project finance (EUR 22 million) and KfW Development Bank (EUR 20 million) also contributed to the positive valuation result.

E. Highest promotional expense of last ten years

KfW's domestic promotional expense, which has a negative impact on its earnings position, rose significantly to EUR 504 million in financial year 2024, compared to EUR 371 million in 2023. This is the highest figure in the last ten years, and significantly exceeded the projected EUR 444 million. The main reason for this development was interest rate reductions, which rose by EUR 123 million to EUR 406 million due to higher reduction margins and an increased promotional volume. Moreover, the obligation to issue grants under KfW's ERP promotional programmes in the years ahead, which was again applicable in financial year 2024, led to promotional expense of EUR 70 million (2023: EUR 62 million).

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

The following key figures provide an overview of the development of key financial figures in financial year 2024:

Key financial figures of KfW Group

	2024	2023
Key figures of the income statement	EUR in millions	EUR in millions
Operating result before valuation (before promotional expense)	1,917	1,797
Operating result after valuation (before promotional expense)	2,126	2,109
Promotional expense	504	371
Consolidated profit	1,402	1,559
Cost-income ratio (before promotional expense)1)	46.4%	46.3%
	2024	2023
Key economic figures	EUR in millions	EUR in millions
Consolidated profit before IFRS effects	1,354	1,347
	31 Dec. 2024	31 Dec. 2023
Key figures of the statement of financial position	EUR in billions	EUR in billions
Total assets	545.4	560.7
Volume of lending	593.5	599.1
Volume of business	713.3	724.4
Equity	39.6	38.1
Equity ratio	7.3%	6.8%

1) Administrative expense (before promotional expense) in relation to adjusted income. Adjusted income is calculated as the sum of net interest income and net commission income (in each case before promotional expense).

Comparison with the previous year's forecast

	2023 forecast for 2024	2024 actual
New business
Promotional business volume	EUR 89.2 billion	EUR 112.8 billion
Funding	EUR 90–95 billion	EUR 78.1 billion
Result
Consolidated profit	EUR 1.03 billion	EUR 1.4 billion
Net interest income (before promotional expense)	EUR 2.7 billion	EUR 2.9 billion
Net commission income (before promotional expense)	EUR 0.7 billion	EUR 0.7 billion
Administrative expense (before promotional expense)	EUR 1.6 billion	EUR 1.7 billion
Risk provisions for lending business	EUR -0.5 billion	EUR +0.0 billion
Valuation result	EUR +0.2 billion	EUR +0.2 billion
Promotional expense	EUR 0.4 billion	EUR 0.5 billion

The main differences between the forecasts from the Financial Report 2023 and actual business development in 2024 are set out above.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Development of the KfW Group earnings position

The 2024 earnings position was marked by a year-on-year increase in operating result, a positive valuation result and an increased promotional grant. Tax expense rose considerably at the same time. These developments resulted in a consolidated profit of EUR 1.4 billion, which, although below the prior-year figure of EUR 1.6 billion, was well above the target of EUR 1.0 billion.

Reconciliation of internal earnings position (before promotional expense) with external earnings position (after promotional expense) for financial year 2024

	Reconciliation
	EUR in millions	EUR in millions	EUR in millions
Net interest income (before promotional expense)	2,900	-408	2,493	Net interest income
Net commission income (before promotional expense)	675	-12	664	Net commission income
Administrative expense (before promotional expense)	1,658	14	1,672	Administrative expense
Operating result before valuation (before promotional expense)	1,917	-433	1,484	Operating result before valuation
Risk provisions for lending business	39	-1	39	Net gains/losses from risk provisions
Net gains/losses from hedge accounting	107	0	107	Net gains/losses from hedge accounting
Other financial instruments at fair value through profit or loss	44	0	44	Net gains/losses from other financial instruments at fair value through profit or loss
Securities and investments	-0	1	0	Net gains/losses from disposal of financial assets at amortised cost
Net gains/losses from investments accounted for using the equity method	20	0	20	Net gains/losses from investments accounted for using the equity method
Operating result after valuation (before promotional expense)	2,126	-433	1,693	Operating result after valuation
Net other operating income (before promotional expense)	18	-70	-52	Net other operating income or loss
Profit/loss from operating activities (before promotional expense)	2,145	-504	1,641	Profit/loss from operating activities
Promotional expense	504	-504	0	-
Taxes on income	239	0	239	Taxes on income
Consolidated profit	1,402	0	1,402	Consolidated profit
Temporary net gains/losses from hedge accounting	48		48	Temporary net gains/losses from hedge accounting
Consolidated profit before IFRS effects	1,354	0	1,354	Consolidated profit before IFRS effects

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Reconciliation of internal earnings position (before promotional expense) with external earnings position (after promotional expense) for financial year 2023

	Reconciliation
	EUR in millions	EUR in millions	EUR in millions
Net interest income (before promotional expense)	2,738	-282	2,456	Net interest income
Net commission income (before promotional expense)	606	-13	593	Net commission income
Administrative expense (before promotional expense)	1,547	14	1,561	Administrative expense
Operating result before valuation (before promotional expense)	1,797	-309	1,488	Operating result before valuation
Risk provisions for lending business	165	4	169	Net gains/losses from risk provisions
Net gains/losses from hedge accounting	291	0	291	Net gains/losses from hedge accounting
Other financial instruments at fair value through profit or loss	-177	0	-177	Net gains/losses from other financial instruments at fair value through profit or loss
Securities and investments	4	-4	0	Net gains/losses from disposal of financial assets at amortised cost
Net gains/losses from investments accounted for using the equity method	29	0	29	Net gains/losses from investments accounted for using the equity method
Operating result after valuation (before promotional expense)	2,109	-309	1,800	Operating result after valuation
Net other operating income (before promotional expense)	-14	-62	-76	Net other operating income or loss
Profit/loss from operating activities (before promotional expense)	2,095	-371	1,724	Profit/loss from operating activities
Promotional expense	371	-371	0	-
Taxes on income	165	0	165	Taxes on income
Consolidated profit	1,559	0	1,559	Consolidated profit
Temporary net gains/losses from hedge accounting	212		212	Temporary net gains/losses from hedge accounting
Consolidated profit before IFRS effects	1,347	0	1,347	Consolidated profit before IFRS effects

At EUR 1,917 million, Operating result before valuation (before promotional expense) was above the prior-year level (EUR 1,797 million) and well above the target (EUR 1,758 million).

At EUR 2,900 million, Net interest income (before promotional expense) exceeded the prior-year level (EUR 2,738 million) by 6% and the target (EUR 2,719 million) by 7%. One key factor driving the year-on-year increase was the significantly higher income from borrowings, which was considerably above both the previous year's figure and the target. KfW benefited from favourable funding conditions on the capital and money markets, which can be attributed to its excellent credit rating. Income from investment of own funds also increased significantly due to higher interest rates and investment volumes compared to the previous year. By contrast, interest margin income including commitment fees declined, although it still exceeded expectations considerably.

Net commission income (before promotional expense) amounted to EUR 675 million, which was well above the 2023 figure (EUR 606 million) and exceeded expectations (EUR 651 million). The main factor for the growth in net commission income was income from cost-based remuneration that KfW received from the Federal Government for implementation of domestic promotional programmes and administration of Financial Cooperation. KfW generated income of EUR 363 million from the implementation of its domestic promotional programmes, compared to EUR 288 million in the previous year and a target of EUR 338 million. The main reason for the year-on-year increase in this income was the rise in Federal Funding for Efficient Buildings and heating promotion (under the Buildings Energy Act (Gebäudeenergiegesetz) and the Future Fund implemented by KfW Capital. KfW received income of EUR 255 million from the administration of Financial Cooperation (2023: EUR 245 million). The remuneration from the Federal Government was offset by related administrative expenses. On the other hand, commission income in the business sector Export and project finance declined by EUR 17 million to EUR 26 million, due in particular to loan fees, thus falling short of the target figure.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Administrative expense (before promotional expenses) in financial year 2024 was significantly influenced by inflation and the costs of implementing additional promotional programmes. Overall, administrative expense rose from EUR 1,547 million to EUR 1,658 million and was therefore slightly higher than planning assumptions (EUR 1,612 million). Personnel expense increased by 10% to EUR 961 million, compared to EUR 873 million in the previous year. This significant increase was primarily due to higher wages and salaries resulting from an increase in the number of employees, which in turn was partly due to launching new promotional programmes. The rise in non-personnel expense (before promotional expense) from EUR 674 million to EUR 697 million resulted in particular from higher costs for the use of external service providers, which were influenced by both price and volume effects.

The development of the operating earnings components resulted in an overall cost-income ratio (before promotional expense) of 46.4%, which was similar to the previous year (46.3%). Adjusted for income and expenses from products for which cost-based remuneration has been agreed with the Federal Government, the cost-income ratio for 2024 amounted to 33.7% (2023: 33.8%).

Despite persisting uncertainty in the geopolitical and macroeconomic environment, the result from risk provisions for lending business in 2024 was total income of EUR 39 million (2023: EUR 165 million) which was significantly better than the projected standard risk costs (EUR -495 million). A major factor in the positive result was the continued favourable risk situation in KfW's lending book.

The positive development in provisions for individual risks that cannot be allocated is essentially due to two opposing effects. The negative effects from the adjustment of the second, more conservative macroeconomic scenario, which takes into account the increased forecasting uncertainty regarding global economic developments, were more than offset by positive effects from various methodological developments in the risk models. The risk provisions for performing loans (stages 1 and 2) were fully reversed. This resulted in net additions of EUR 51 million (2023: EUR 172 million).

Net additions of EUR 50 million (2023: EUR 72 million) were recorded in risk provisions for non-performing loans (stage 3) including direct write-offs in 2024. Net additions of EUR 98 million (2023: EUR 64 million) were largely recorded by the business sector Mittelstandsbank & Private Kunden (SME Bank & Private Clients). Of the latter amount, EUR 76 million was attributable to education financing (2023: EUR 42 million). The business sector Export and project finance, in contrast, recorded net reversals of EUR 50 million (2023: net additions of EUR 68 million).

Income from recoveries of loans previously written off totalled EUR 43 million and was therefore below that of the previous year (EUR 66 million). Almost the total of recoveries (EUR 39 million) related to the business sector SME Bank & Private Clients.

At EUR 1.9 billion, Risk provisions for lending business at the end of 2024 were almost unchanged from the previous year. This development reflected both an unchanged provision for acute risks in stage 3 of EUR 1.4 billion and a slightly lower overall provision for individual risks that cannot be allocated, with provisions in stages 1 and 2 each amounting to EUR 0.3 billion.

Net gains/losses from hedge accounting and other financial instruments at fair value through profit or loss amounted to EUR 150 million (2023: EUR 114 million). This result was driven in financial year 2024 by positive valuation effects from the equity investment portfolio, offset in part by declining positive IFRS-related effects from the measurement of derivatives used for hedging purposes and a negative foreign currency result.

The equity investment portfolios recognised at fair value through profit or loss generated total income of EUR 129 million in financial year 2024 (2023: expense of EUR 130 million). DEG made a significant contribution to the favourable development with a positive valuation result of EUR 81 million. DEG's loss from securities of EUR 53 million (2023: income of EUR 13 million) was more than offset by positive exchange rate-induced effects – particularly appreciation of the US dollar. KfW Capital also generated a positive result of EUR 33 million from its equity investment portfolio, after the previous year (expense of EUR 93 million) had been negatively affected by a significant deterioration in venture capital market conditions. KfW Development Bank and the business sector Export and project finance also performed positively, with results of EUR 13 million

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

(2023: EUR 59 million) and EUR 8 million (2023: expense of EUR 8 million) respectively. On the other hand, the business sector Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) recorded an expense of EUR 2 million, which nonetheless represents a year-on-year improvement (2023: EUR –15 million).

Hedge accounting and borrowings recognised at fair value, including derivatives used for hedging purposes, generated net additions of EUR 48 million (2023: EUR 203 million). The mark-to-market derivatives are part of economically hedged positions. However, if the other part of the hedging relationship cannot be carried at fair value or different valuation methods and parameters have to be applied, this inevitably results in temporary fluctuations in income that are fully offset over the term of the transactions.

The measurement of securities at fair value through profit or loss yielded an almost balanced result, as in the previous year, of EUR 0 million.

In the case of securities not carried at fair value, developments in the financial markets resulted in a net difference of EUR –167 million between the carrying amount and the fair value (2023: EUR –87 million). This development was partly attributable to decreases in the value of the covered bonds. However, there were essentially no defaults or significant deteriorations in credit quality.

Net gains totalling EUR 19 million (2023: EUR 33 million) were recorded from securities and investments as well as from investments accounted for using the equity method. Investments accounted for using the equity method contributed EUR 20 million to the result. This was primarily due to value increases in the business sectors Export and project finance and KfW Development Bank.

Net other operating income (before promotional expense) was EUR 18 million, a considerable increase from the previous year's figure (2023: expense of EUR –14 million).

At EUR 504 million in 2024, KfW's domestic promotional expense, which has a negative impact on KfW Group's earnings position, was above the prior-year level (EUR 371 million) and slightly above projections (EUR 444 million). The ERP promotional business proportion of promotional expense amounted to EUR 360 million.

Interest rate reductions are the key component of KfW's promotional expense. KfW grants these reductions for certain domestic promotional loans during the first fixed-interest-rate period, which has a negative effect on its earnings position. In addition, KfW passes on its favourable funding conditions, which benefit from its triple-A rating. At EUR 406 million, the volume of interest rate reductions increased once again in financial year 2024 (2023: EUR 282 million), and was slightly above the projected figure (EUR 405 million). Of this amount, EUR 276 million was attributable to ERP promotional business. The increase in interest rate reductions was primarily a result of sustained higher interest rates, which made higher reduction margins possible and led to an additional increase in demand for promotional loans at reduced rates. The promotional grants provided in addition to the lending business and recognised as promotional expense in Net other operating income rose to EUR 70 million in financial year 2024. The reason for the increase was the obligation to award grants under KfW's ERP promotional programmes; with promotional expenses of EUR 70 million, above the corresponding charges from the previous year (EUR 62 million). Moreover promotional expenses reported in net commission income and administrative expense amounted to EUR 26 million (2023: EUR 27 million). Among other things, this spending was aimed at the sale of KfW's promotional products.

The group recognised a tax expense of EUR 239 million for financial year 2024 (2023: EUR 165 million). This consisted of current taxes on income of EUR 167 million (2023: EUR 117 million) and deferred tax expense of EUR 72 million (2023: EUR 47 million). The increase in current taxes was primarily due to the positive earnings performance of the taxable companies included in the consolidated financial statements in 2024 and the elimination of previously recognised tax loss carryforwards.

Overall, the group generated a consolidated profit of EUR 1,402 million, which is below the previous year (EUR 1,559 million) but considerably above expectations of around EUR 1,030 million.

Consolidated profit before IFRS effects from hedging is another key financial figure. It is calculated based on Consolidated profit in accordance with IFRS to reflect the fact that the group uses derivative

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

financial instruments solely for hedging purposes. Under IFRS, the requirements for the recognition and valuation of derivatives and hedges give rise to temporary net gains or losses that are offset over the entire term of the transactions. Against this backdrop, IFRS effects from hedging relationships amounting to EUR 48 million (2023: EUR 212 million) were eliminated.

The reconciled earnings position stood at a net gain of EUR 1,354 million, which was therefore substantially at the level of the previous year (EUR 1,347 million). The development in consolidated comprehensive income was largely due to the strong development of the operating result before valuation and the positive valuation result from the equity investment portfolio. These positive factors were offset in part by higher promotional expenses and higher tax expenses. Accordingly, the result exceeds the sustainable earnings potential of EUR 1.0 billion overall by a significant degree.

Development of net assets of KfW Group

Lending to banks and customers accounted for 80% of the group's assets as of 31 December 2024, unchanged from the previous year.

Assets of KfW Group

31 December 2024 (31 Dec. 2023)

A = Net loans and advances to banks
B = Net loans and advances to customers
C = Securities and investments
D = Other receivables to banks and customers
E = Derivatives
F = Other assets

Compared to the previous year, the volume of lending decreased by EUR 5.6 billion to EUR 593.5 billion (previous year: EUR 599.1 billion).

Volume of lending of KfW Group

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Loans and advances	441,915	450,020
Risk provisions for lending business	-1,818	-1,852
Net loans and advances	440,097	448,168
Contingent liabilities from financial guarantees	3,462	3,486
Irrevocable loan commitments	138,628	136,118
Loans and advances held in trust	11,287	11,281
Total	593,475	599,054

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Net loans and advances decreased by EUR 8.1 billion in 2024, mainly due to the decline of EUR 7.5 billion in the coronavirus special programme 2020 (particularly in the KfW Entrepreneur Loan and KfW Entrepreneur Loan – SMEs programmes) and to liquidity support to energy suppliers of EUR 3.8 billion. The loan portfolio of the business sector Export and project finance moved in the opposite direction with an increase of EUR 5.6 billion. Overall, however, unscheduled repayments (EUR 11.1 billion; 2023: EUR 11.0 billion) and scheduled repayments were higher than disbursements in new lending business. At EUR 440.1 billion, Net loans and advances accounted for 74% of lending volume.

Contingent liabilities from financial guarantees remained at the previous year's level, at EUR 3.5 billion. The increase in irrevocable loan commitments of EUR 2.5 billion to EUR 138.6 billion was mainly due to irrevocable commitments for the development of the hydrogen core network of EUR 24.0 billion. Irrevocable loan commitments for liquidity support to energy suppliers and to the Federal Funding for Efficient Buildings ("BEG")/ Energy-Efficient Construction and Refurbishment programmes each declined to EUR -9.2 billion. Within assets held in trust, the volume of Loans and advances held in trust, which primarily comprise loans to promote developing countries and emerging economies financed by budget funds provided by the Federal Republic of Germany, remained unchanged at EUR 11.3 billion.

Other loans and advances to banks and customers posted an increase of EUR 4.0 billion to EUR 32.9 billion. A total of EUR 3.5 billion of the increase resulted from reverse repo transactions, in which KfW acts in the capacity of lender, and from higher deposits, mainly at banks (EUR 2.1 billion), while cash collateral provided decreased by EUR 2.8 billion.

The total amount of securities and investments, at EUR 43.1 billion, was 6% above the previous year's level.

Securities and investments of KfW Group

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Bonds and other fixed-income securities	37,982	36,057
Shares and other non-fixed income securities	0	0
Equity investments	5,031	4,418
Shares in non-consolidated subsidiaries	92	90
Total	43,106	40,565

The securities portfolio increased by EUR 1.9 billion to EUR 38.0 billion in financial year 2024 (31 Dec. 2023: EUR 36.1 billion). The portfolio of Equity investments, including both direct and fund investments, and Shares in non-consolidated subsidiaries increased by EUR 0.6 billion to EUR 5.1 billion in 2024. This was due in part to portfolio growth at KfW Capital and DEG.

Value adjustments from macro hedge accounting rose by EUR 5.4 billion, based on fair value and due to amortisation effects, from EUR -14.8 billion to EUR -9.4 billion. Derivatives with positive fair values, which are primarily used to hedge refinancing transactions, rose from EUR 7.8 billion in the previous year to EUR 9.7 billion. This was primarily due to value adjustments of derivatives used in micro hedge accounting, which increased from EUR 4.0 billion to EUR 6.6 billion.

KfW reduced its balances with central banks by EUR 20.9 billion to EUR 26.5 billion and made greater use of other investments. The liquidity held continues to ensure KfW's ability to react to market events at short notice. There were only minor changes in the other asset line items in the statement of financial position.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

Development of the KfW Group financial position

KfW Group's funding strategy is based on four main product categories: "benchmark programmes in euros and US dollars", "Green Bonds – Made by KfW", "other public bonds" and "private placements". In 2024, KfW raised a funding volume of EUR 78.1 billion on the international capital markets and thus substantially achieved its funding target of EUR 80.0 billion, which was adjusted during the year. A funding target of EUR 90–95 billion was originally planned for 2024. This target was revised downwards in July 2024 due to lower than expected funding requirements from Federal Government-mandated transactions and reduced demand in the domestic lending business.

Financial position of KfW Group

31 December 2024 (31 Dec. 2023)

Borrowings decreased by EUR 14.4 billion to EUR 493.0 billion.

Borrowings of KfW Group

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Short-term funds	33,947	40,773
Bonds and notes	422,994	414,553
Other funding	36,042	52,025
Total	492,983	507,352

Funds raised in the form of certificated liabilities rose by EUR 3.2 billion to EUR 455.5 billion. Of this increase, EUR 8.4 billion was attributable to medium and long-term bonds and notes, which remain the group's principal source of funding. At year-end 2024, such funds amounted to EUR 423.0 billion (31 Dec. 2023: EUR 414.6 billion) and accounted for 86% of borrowings. Short-term issues of commercial paper declined by EUR 5.2 billion to EUR 32.5 billion. Total short-term funds, including demand deposits and term deposits, amounted to EUR 33.9 billion, compared with EUR 40.8 billion in the previous year. Funds were released in the course of the partial repayment of loans under the liquidity support for energy suppliers and the coronavirus special programme 2020. This resulted in a decline in Other funding by EUR 16.0 billion to EUR 36.0 billion (31 Dec. 2023: EUR 52.0 billion). Other funding mainly includes promissory note loans (Schuldsscheindarlehen) from customers, which declined by EUR 14.2 billion to EUR 24.7 billion (primarily representing funding through the WSF). In contrast, cash collateral received, which primarily serves to reduce counterparty risk from the derivatives business, rose from EUR 2.9 billion in the previous year to EUR 4.5 billion.

KfW Financial Report 2024

Financial Report > Combined Management Report > Economic report

The carrying amounts of derivatives with negative fair values, which were primarily used to hedge own issues, decreased by EUR 2.7 billion, from EUR 12.0 billion as of 31 December 2023, primarily due to changes in market parameters, and amounted to EUR 9.3 billion at year-end 2024.

There were only minor changes in the other liability line items of the statement of financial position.

At EUR 39.6 billion as of 31 December 2024, equity was EUR 1.5 billion above the level of EUR 38.1 billion as of 31 December 2023. The increase resulted in particular from consolidated profit (EUR 1.4 billion), which increased retained earnings. The effects resulting from changes in KfW's own credit risk caused a rise of EUR 0.1 billion in revaluation reserves. The equity ratio increased year on year from 6.8% to 7.3% as of 31 December 2024, primarily due to the increase in equity.

Equity of KfW Group

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Paid-in subscribed capital	3,300	3,300
Capital reserve	8,447	8,447
Reserve from the ERP Special Fund	1,191	1,191
Retained earnings	26,552	25,150
Revaluation reserves	83	-15
Total	39,573	38,073

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Risk report

Overview of key indicators

Risks are reported at group level in accordance with KfW Group’s internal risk management. The key risk indicators are presented below:

Regulatory capital ratios:

The sharp rise in the total capital ratio by around 2.4 percentage points compared with the previous year is due to the increase in regulatory capital (by EUR 1.5 billion) and the marked decrease in total risk exposure ("RWA"; by EUR -5.2 billion), mainly due to method adjustments in the exposure at default and loss given default environment as well as rating improvements at on-lending banks.

A = Tier 1 capital ratio
B = Total capital ratio

Credit risk:

Net exposure breakdown¹)

The credit quality structure of the portfolio was stable year on year.

A = Investment grade
B = Non-investment grade
C = Watch list
D = Default

¹) Compared to the previous year excluding equity investment risk

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Economic risk-bearing capacity

EUR in billions

Economic risk-bearing capacity was maintained at a confidence level of 99.9% at all times in the reporting year. The increase in available financial resources ("AFR") was primarily due to the positive annual result. The total capital requirement increased in particular due to the higher capital requirement for credit risk as a result of method developments. In addition, the economic capital requirement for market price risk is increasing due to expansion of the strategic interest rate position.

A = Available financial resources

B = Total economic capital requirement

Market price risk

ECAP (EUR in billions)

The total capital requirement for market price risk increased year on year. This is mainly due to the higher economic capital ("ECAP") requirement for interest risk. Expanding the strategic interest rate position has the effect of increasing risk in such case. In credit spread risk, the first-time inclusion of credit spreads in the present value measurement of pension provisions serves to reduce risk.

A = Interest risk B = Interest volatility risk

C = Currency risk D = Credit spread risk

Liquidity risk

The liquidity risk indicator remained considerably below the internal limit throughout the year. The decrease is mainly due to lower funding requirements as a result of lower expected drawdowns on credit lines.

A = Liquidity risk indicator (worst case)

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Operational risk

ECAP (EUR in millions)

Current developments

In financial year 2024, as in previous years, KfW Group refined the processes and instruments of its risk management and controlling, taking into account current banking supervisory requirements. In particular, the method for modelling expected rating changes and the economic risk-bearing capacity concept were further improved. The risk inventory was revised to take the materiality assessment into account. In addition to existing interest rate risk in the banking book ("IRRBB") reporting, credit spread risk in the banking book ("CSRBB") reporting has now also been put into practice in market price risk reporting with regard to earnings. The same applies to the expanded implementing technical standards ("ITS") on supervisory reporting of IRRBB reporting. KfW also implemented the requirements of the EU regulation Digital Operational Resilience Act ("DORA") in a crossfunctional project. DORA is aimed at mitigating the risks associated with digital transformation in the financial services sector and at promoting cyber resilience.

An additional focus was placed on further developing the management of environmental, social and governance risks ("ESG risks") as part of a group-wide project involving all subsidiaries. As a result of these further developments, ESG risks are now more extensively and explicitly addressed and integrated in existing risk management cycle instruments. A comprehensive ESG risk driver analysis was performed as the basis for the risk inventory. The identified ESG risk drivers were categorised and the effects on KfW's risk types calculated. The process found that environmental and governance risks in particular impact credit risk, while social risks are particularly relevant for KfW's equity investment risk. The risk appetite relating to ESG risk was also determined in 2024, and was defined through capital allocation buffers. These serve, among other purposes, to mitigate ESG-induced losses that may materialise in the long term. ESG risk management is operationalised in particular in the course of monitoring threshold values for defined ESG-related credit risk indicators. Operational implementation is scheduled for the beginning of 2025. Moreover, the functionality of the ESG risk profiles for identification and assessment of ESG risk drivers in credit risk is being continually expanded and increasingly integrated into risk measurement and management. Further key elements include regular stress tests based on special ESG stress test methods and a risk reporting system that is supplemented by ESG factors. In order to develop a group-wide biodiversity strategy, specific aspects of ESG risk management are addressed in a separate workstream as part of implementing the BioDiv roadmap.

The KfW subsidiary KfW IPEX-Bank was classified as a significant institution on 29 November 2024 with communication of the final decree. The European Central Bank ("ECB") assumed direct supervision of KfW IPEX-Bank with effect from 1 January 2025.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Basic principles and objectives of risk management

KfW Group has a statutory promotional mandate. Sustainable promotion is KfW Group's overarching purpose. The aim of risk management is for the group to take risks only to the extent that they appear manageable in the context of its current and anticipated earnings position and capital resources. KfW Group's risk/return management takes into account the business model of a promotional bank without the primary intention of generating a profit and without a trading book, with appropriate implementation of supervisory requirements constituting a fundamental prerequisite for the group's business activities.

The promotional bank business model determines the group's risk culture with its four regulatory-based elements: leadership culture, responsibilities, communication and incentives. Incentive structures for employees and their responsibilities are designed accordingly. Senior management specifies the desired code of conduct, with the desired dialogue established by means of communication with and through the relevant bodies.

Organisation of risk management and monitoring

Risk management bodies and responsibilities

KfW's Executive Board sets the group's risk guidelines as part of its overall responsibility. The Board of Supervisory Directors is informed at least quarterly of KfW Group's risk situation. The Risk and Credit Committee set up by the Board of Supervisory Directors is primarily responsible for advising the Board of Supervisory Directors about the group's current and future overall risk tolerance and strategy and supports it in monitoring the implementation of the latter. The Committee decides on loan approvals (including loans to members of management), operational level equity investments, funding and swap transactions, where committee authorisation is required by the KfW Bylaws. The Audit Committee monitors, above all, the accounting process and the effectiveness of the risk management system and internal control and offers recommendations to the Board of Supervisory Directors concerning its approval of KfW's annual and consolidated financial statements.

Additionally, the subsidiaries and organisational entities of KfW Group exercise their own control functions within the group-wide risk management system. Group-wide regulations, projects and working groups are in place to implement a consistent approach, such as in the rollout of rating instruments to subsidiaries or in the management and valuation of collateral. The responsibility for developing and structuring risk management and risk control activities is located outside the front-office departments and lies in particular with the Risk Controlling and Credit Risk Management areas.

Risk management within the group is carried out by various interconnected decision-making bodies. At the top of the system is the Executive Board, which takes the key decisions on risk policy. There are three risk committees below Executive Board level (Credit Risk Committee, Market Price Risk Committee and Operational Risk Committee) that prepare decisions for the Executive Board, take their own decisions within their remits, and also involve representatives from KfW subsidiaries in decision-making processes. Internal Auditing has a fundamental right to attend risk management committee meetings. Working groups such as the Credit and Equity Investment Risk Working Group, Country Rating Working Group, Corporate Sector Risk Working Group, Market Price Risk Working Group and Hedge Committee support the committees. Committee resolutions are adopted by simple majority, whereby the rules on voting eligibility take appropriate account of the requirements of the respective roles and the independence of the Risk Controlling and front and back office departments in particular. Escalation to Executive Board level is possible in all committees.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Board of Supervisory Directors
Risk and Credit Committee	Audit Committee	Presidial and Nomination Committee	Remuneration Committee

Executive Board

Credit Risk Committee	Market Price Risk Committee		Operational Risk Committee

Credit Risk Committee

The Credit Risk Committee is a decision-making and discussion body for lending decisions as well as for overarching loan portfolio and credit risk issues. The Credit Risk Committee is chaired by the Chief Risk Officer and meets once a week.

The weekly meetings of the Credit Risk Committee involve making lending decisions and preparing for decisions to be made by the plenary Executive Board in line with the credit approval policy, with KfW subsidiary exposures also being presented. Voting members of the committee are, in addition to KfW Group's Chief Risk Officer ("CRO"), the Head of Credit Risk Management, members of the Executive Board with front-office responsibilities and KfW IPEX-Bank's Chief Risk Officer. DEG's CRO is a member without voting rights. In addition, current developments in and management tools for the loan portfolio as well as fundamental issues concerning credit risk management are analysed on an ad hoc basis. This includes reports and submissions from the Country Rating Working Group and the Corporate Sector Risk Working Group. DEG's CRO, the managing director of KfW Capital responsible for risk issues and the Head of Risk Controlling are also entitled to vote.

Moreover, once a month, the Credit Risk Committee discusses overarching credit risk issues of risk controlling and makes decisions on significant adjustments in accordance with the competency matrix. These essentially include reports and draft resolutions on the risk situation and risk management – in particular on stress tests for credit and equity investment risks – as well as on credit risk methods and policies, and the submissions addressed in the Credit and Equity Investment Risk Working Group. Reports are also made on the development of regulatory requirements, their impact and the progress of implementation projects in KfW Group. Only the CRO and the Head of Risk Controlling are entitled to vote on these issues relating to the risk controlling function.

The Credit Risk Committee is supported by various working groups. The Country Rating Working Group serves as the central unit for assessing country risk. The Credit and Equity Investment Risk Working Group supports the committee in connection with methodological and procedural issues and decisions relating to credit and equity investment risk measurement instruments and rating systems, and collateral acceptance and valuation, in particular the (further) development of methods used, implementation of regulatory requirements, acknowledgement of validation results and adjustments to the relevant processes. The Corporate Sector Risk Working Group is a group-wide expert panel which analyses sector and product-related credit risks in the corporate segment. The decisions made, reports submitted, and other key topics addressed in the working groups are communicated to the Credit Risk Committee through the working group minutes.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Market Price Risk Committee

The Market Price Risk Committee meets monthly or on an ad hoc basis, as required, and is chaired by the Chief Risk Officer. In addition to the Chief Risk Officer, the members of the Executive Board responsible for capital markets business and finance are also represented. The members of the committee also include the heads of Risk Controlling, Financial Markets, Finance, Transaction Management and the CROs of KfW IPEX-Bank and DEG. The Market Price Risk Committee discusses KfW Group's market price and liquidity risk position and assesses the market price risk strategy on a monthly basis. The committee also decides on questions relating to the principles and methods applied for the management of market price and liquidity risks, on funding, transfer pricing and on valuation for commercial transactions. The Market Price Risk Committee is supported by the Hedge Committee and the Market Price Risk Working Group. The Hedge Committee deals primarily with the earnings effects of IFRS hedge accounting and the further development thereof. The Market Price Risk Working Group deals with methodology issues relating to market price and liquidity risks as well as measurement issues. These include matters relating to model development, validation and financial reporting measurement, in particular, taking note of validation reports and recommendations resulting from validation. A distinction is made between voting rights relating to different subject areas, with decisions on risk controlling issues made without the votes of the front and back offices.

Operational Risk Committee

The Operational Risk Committee meets once every quarter and provides support to the Executive Board in cross-functional management, in taking the necessary decisions and acknowledgements in respect of operational and reputational risk, and in protecting group security including business continuity management ("BCM"). The Chief Risk Officer is responsible for chairing the Operational Risk Committee meetings. In principle, all areas of the bank are represented in the committee – in selected cases based on a representation concept. Moreover, the managing director level of KfW IPEX-Bank, DEG and KfW Capital is represented on the committee. The committee discusses the risk status on the basis of the findings obtained through different methods and instruments and evaluates any group-wide need for action, with the aim of adequate risk management. The results of the validation of the OpRisk model are acknowledged. In the area of BCM, the committee is informed about the results of the annual business impact analysis and the failure scenarios identified and to be addressed by contingency plans. There is also quarterly reporting on the status of BCM using a risk indicator. The committee meeting documents, together with the minutes and the resolutions and recommendations contained therein, are submitted to the Executive Board. The committee formed the Group Security Board ("GSB") to take up matters related to group security and BCM.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Risk management approach of KfW Group (overview)

Governing bodies	Management bodies and responsibilities at KfW Group
	Board of Supervisory Directors
Risk and Credit Committee	Audit Committee	Presidial and Nomination Committee	Remuneration Committee
	KfW Executive Board
Strategy/ objectives	Strategic objectives
Business strategy
Securing KfW's promotional capacity by ensuring capital adequacy (ICAAP) and liquidity (ILAAP)
Group risk management is monitoring the subsidiaries' business activities according to the "look through" principle
Risk Appetite Statement
Definition of risk appetite and ranges of tolerance (risk appetite dashboard)
Risk committees & internal control procedures
Credit Risk Committee
Market Price Risk Committee
Operational Risk Committee
Internal control system ("ICS")
Direction front/back office	Direction internal control mechanisms			Direction Internal auditing
	Direction Risk Management/Controlling*	Direction Compliance
Internal capital adequacy assessment process (ICAAP)
Ensuring economic and normative risk-bearing capacity, avoiding excessive indebtedness		Stress tests	Internal liquidity adequacy assessment process (ILAAP)
Model development and validation processes
Model inventory
Modelling guideline
Methodology principles
Risk management cycle
Risk identification
Risk measurement
Managing risks & ensuring risk appetite compliance
Risk reporting
1st LoD	Rule-setting 2nd LoD
Proceses and instruments (process-integrated controls)	Credit risk Methodology:
- Internal rating models
- Loan portfolio model
Requirements to:
- Portfolio guidelines
- Risk guidelines
- Voting on new business
- Limit management system
- Collateral management
- Early warning procedure
- Intensive monitoring	Market price risk Methodology:
- Proprietary models for interest, interest rate volatility, foreign currency and credit spread risks
Requirements to:
- Limiting and budgeting
Investment risk Methodology:
- Value-based risk measurement
Requirements to:
- Risk management process for equity investments at operational level
- Management of strategic equity investments	Operational risk Methodology:
- Model for determining capital requirements (Pillar II)
- Risk assessments
Requirements to:
- Risk indicators
- Loss event analyses
- Emergency concepts/crisis team
- Central management of compliance risks	Liquidity risk Methodology:
- Proprietary models for liquidity risks
- Liquidity transfer pricing
Requirements to:
- Limiting
- Scenario analyses
- Early warning procedure
- Emergency planning
Implementing risk management requirements 2nd LoD	Model risk
Model risk management
	Risk concentrations
Risk strategy addresses intra- and inter-risk concentrations as well as profit concentrations
Environmental, social and governance risks (ESG risks)
Project for further developing comprehensive assessment of ESG risks in relevant management concepts
New Products Process ("NPP") / changes in operational processes or structures / mergers and acquisitions
IT system landscape and data quality management

In addition to Risk Controlling, further non market-dependent departments in some cases also exercise control functions due to organisational reasons.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

To ensure capital and liquidity adequacy in line with the defined risk appetite, Risk Controlling supports the Executive Board in developing and implementing the group's risk strategy together with the relevant subsidiaries, KfW IPEX-Bank, DEG and KfW Capital.

The risk strategy translates the group's long-term and strategic risk objectives into operational risk management requirements. This involves defining risk management objectives for core business activities and measures for achieving targets, as well as determining KfW Group's appetite for material risks.

In order to determine its material risks, KfW Group conducts a risk inventory at least once a year. The risk inventory identifies and defines types of risks relevant to the group and then subjects them to a materiality evaluation. The materiality of a risk type depends on the potential material danger for KfW Group's net assets, earnings and liquidity. The key outcome of the risk inventory is an overall risk profile, which provides an overview of KfW Group's material and immaterial risk types. The materiality assessment procedure used in the previous year was adjusted as part of a concept revision. The 2024 inventory identified that KfW Group faces the following material risks: credit, market price, liquidity, operational, equity investment and model risks. In further developing the risk inventory process and its first-time application in the risk inventory valid for financial year 2025, concentration risk, regulatory risk and intra-group risk were no longer considered independent risk types.¹

In addition, the risk inventory process involves looking at the impact of ESG risks on the overall risk profile.

The Executive Board is informed about KfW Group's risk situation on a monthly basis. In addition, there is weekly reporting on market price and liquidity risks to the responsible Executive Board members. A risk report is issued quarterly to KfW Group's supervisory bodies. The respective bodies are informed on an ad hoc basis as required.

The models used for group-wide risk measurement and management, as well as for financial reporting measurement, are regularly validated and refined where necessary. These primarily include the models for measuring and managing credit, equity investment, market price, liquidity and operational risks, as well as the models for financial reporting measurement.

The risk management approach is set out in the group's procedural rules. The procedural rules stipulate the framework for the application of uniform policies and procedures to identify, measure, control and monitor risk. The rules and regulations laid out in the procedural rules are binding for the entire group and are accessible to employees through their publication on the intranet. KfW group-wide regulations are supplemented by rules specific to each business sector. See the following sections for details on other elements of KfW Group's risk management approach.

¹ The results of the risk inventory are implemented in KfW's risk management concepts with the 2025 risk strategy.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Internal capital adequacy assessment process

The objective of the internal capital adequacy assessment process ("ICAAP") is to maintain sufficient capital at all times to cover the risks assumed. Capital adequacy is assessed from both a normative and an economic perspective. The two perspectives are closely interwoven and ultimately flow into a holistic and consistent risk management system that ensures achievement of the common objective of continued business operations through the bidirectional flow of information. The overarching ICAAP architecture also includes the performance of stress tests to assess the group's capital position under adverse conditions. The aforementioned ICAAP components are presented in the following sections.

In particular, the normative perspective of ICAAP is intended to ensure continuous compliance with the regulatory capital requirements of Pillar I in accordance with the Capital Requirements Regulation ("CRR") and the German Banking Act (Kreditwesengesetz – "KWG") both on an ongoing basis, and in a longer-term view (normative capital planning). In addition to a base scenario, adverse scenarios (downturn and stress scenarios) are considered. In these adverse scenarios, deviations from the base scenario are determined and projected for the planning period. This procedure also takes into account the simultaneous materialisation of losses from the material risk types identified as part of the risk inventory, which may result in lower regulatory capital. This includes, in particular, risks that do not have to be explicitly backed with capital under Pillar 1, such as interest risk. Furthermore, an increase in total RWA is assumed along with a significant mild or severe recession scenario.

The multi-year capital planning process is based on the strategic objectives defined as part of group business sector planning and is updated quarterly in terms of assumptions and market parameters. The development of the large exposure limit and the leverage ratio are monitored as further structural capital requirements. This is intended to enable early identification of any capital bottlenecks.

The economic perspective of the ICAAP serves to safeguard the economic assets of the institution in order to protect creditors from economic loss, thereby implementing Pillar 2 of the CRR. This is performed by comparing AFR as of a key date with the risk assumed as of the same date (ECAP for all material risks to capital) and monitored by the control variables of the economic coverage ratio, i.e. the quotient of AFR and economic capital requirement. Both AFR and risk figures are stated at present value and are static (determined at a specific point in time, i.e. they do not take into account new business or periodicity). The risk figures cover all material risks to capital in accordance with the risk inventory (overall risk profile), to the extent that these can be reasonably covered by capital. The amount of economic capital required, and thus the security level of the risk-bearing capacity, is largely determined by the solvency level (99.90%) selected for risk measurement. There is no regular forecast of economic risk-bearing capacity, although an indicative forecast of economic risk-bearing capacity may be produced if necessary, if future developments which may have a material impact on risk-bearing capacity are identified through a list of questions.

Similar to the normative perspective, the economic perspective of the ICAAP also includes regularly performed stress tests in the form of simulations of adverse economic conditions (downturn and stress scenario).

A traffic-light system set up in the context of the key date or base scenario or the adverse scenarios with thresholds for the key indicators relating to normative and economic risk-bearing capacity indicates a need for action as part of operational and strategic management in the event of critical developments.

The ICAAP is subject to an annual review of its adequacy. The results of this review are taken into account in the assessment of risk-bearing capacity.

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

As of 31 December 2024, risk-bearing capacity is stated in terms of both the normative and the economic perspective:

Normative risk-bearing capacity

Key regulatory figures

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Total risk exposure in accordance with Art. 92 CRR	126,183	131,388
– Credit and equity investment risk	118,402	123,401
– Market price risk	1,848	2,224
– Operational risk	5,933	5,764
Regulatory capital	38,189	36,697
– (Common equity) tier 1 capital	38,104	36,646
– Additional tier 1 capital	0	0
– Tier 2 capital	86	50
CET1 ratio	30.2%	27.9%
Tier 1 capital ratio	30.2%	27.9%
Total capital ratio	30.3%	27.9%

KfW calculates significant parts of its total risk exposure based on an advanced IRBA. The considerable increase in the total capital ratio, which rose by around 2.4 percentage points to 30.3%, was due in equal parts to the reduction in total risk exposure and the increase in regulatory capital compared to the previous year. At 30.3%, the total capital ratio at year-end 2024 remained above the overall capital requirement.

The reduction in the total Supervisory Review and Evaluation Process ("SREP") capital requirements ("TSCR") by 0.75 percentage points is due to the supervisory decision update on the individual capital add-on as a result of the positive outcome of the special audit performed in accordance with Section 44 KWG focusing on the specific areas "internal auditing" and "use of information technology".

Minimum requirements for total capital ratios

	31 Dec. 2024	31 Dec. 2023
Total SREP capital requirements (TSCR)	11.50%	12.25%
Capital conservation buffer	2.50%	2.50%
Countercyclical capital buffer	0.61%	0.55%
Other systemic buffer	1.00%	1.00%
Systemic risk buffer	0.02%	0.02%
Overall capital requirement (OCR)	15.64%	16.31%

KfW Financial Report 2024

Financial Report > Combined Management Report > Risk report

Economic risk-bearing capacity

To assess its economic risk-bearing capacity, KfW Group compares its economic capital requirement for potential losses from material quantifiable risks to capital with its AFR calculated at present value. The basis of AFR is KfW Group's equity adjusted for present value differences, the risk provisions for non-value-adjusted business, future cash flows from margins and costs for administration and expected portfolio business defaults, as well as some capital deduction items for a prudent economic valuation. KfW Group bases its calculation of the economic capital requirement on a one-year time frame.

Credit risk is the risk of a negative impact on net assets, earnings position and liquidity if business partners fail to meet their payment obligations to KfW Group at all, in due time or in full (default) or if their credit ratings deteriorate (migration). Credit risk includes settlement risk in connection with derivative transactions and counterparty risk including credit valuation adjustment ("CVA") risk in relation to derivative exposures. CVA risk is reported as part of the combined "counterparty risk (including CVA risk)" sub-risk type. The economic capital requirement for credit risk is quantified by the Risk Controlling department, largely with the help of statistical models. A value-based measurement of credit and equity investment risks is carried out using a loan portfolio model and credit value-at-risk as a risk measure. The economic capital requirement for CVA risk is based on the CVA charge of Pillar I, which is adjusted for economically relevant aspects (including consideration of other risk-relevant items and the use of internal ratings). For settlement risks, a buffer determined on the basis of different quantification approaches, which is reviewed annually, is applied in calculating economic risk-bearing capacity.

The economic capital requirement for market price risk is calculated on the basis of the value-at-risk concept. Pillar II's economic analysis takes account of interest risk of the banking book (consisting of the jointly analysed sub-risk types: interest risk, as well as tenor and cross-currency basis spread risks), foreign currency risk, credit spread risk for securities and interest rate volatility risk. The possible loss of present value or price is determined for each type of market price risk using a value-at-risk ("VaR") based on historical simulation. Ultimately, the economic capital requirement is determined by total VaR, which takes into account breakdown effects²) between the various subtypes of market price risk.

The economic capital requirement for operational risk is calculated using an internal statistical model, which was derived from regulatory requirements for advanced measurement approaches. It takes a risk-sensitive approach to internal and external event data and risk scenarios. The capital requirement is calculated at group level, taking into account diversification effects, and then allocated to the business sectors. Moreover, the measurement of the quality of operational risk management within the group can generate premiums that are then applied to the capital requirement.

In addition, a model risk buffer is applied to cover model weaknesses and foreseeable methodological changes in economic risk-bearing capacity, reviewed and adjusted quarterly and as necessary.

Using this method, the economic risk-bearing capacity as of 31 December 2024 satisfied a confidence level of 99.90%. The excess coverage of the AFR beyond the total capital requirement as of 31 December 2024 (EUR 19,388 million) decreased compared to the previous year's figure (EUR 20,334 million). This was primarily due to the higher economic capital requirement. These requirements are increasing, particularly in credit risk, as a result of methodological developments. The increase in the capital requirement for market price risks was mainly due to an expansion of the strategic interest rate risk position. The increase in AFR was due to the positive annual result.

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Economic risk-bearing capacity as of 31 December 2024

EUR in millions

In brackets: figures as of 31 December 2023

Each risk identification model represents a simplification of a complex reality and builds on the assumption that risk parameters observed in the past can be considered representative of the future. Not all possible inputs and their complex interactions can be identified and modelled for the risk development of a portfolio. This is addressed by including safety margins in the design of the model, and a supplementary model risk buffer in the calculation of economic risk-bearing capacity. This is one reason why KfW Group carries out stress tests with both credit risk models and market price risk models. The group continuously develops its risk models and processes in line with current banking regulations.

Stress and scenario calculations

To ensure the early indicator function and proactive focus of the ICAAP, the group monitors different economic scenarios and their effects on economic and normative risk-bearing capacity on a quarterly basis. The results of these scenarios measure the group's resilience and ability to act should one of them occur.

The baseline scenario for normative risk-bearing capacity includes projected business performance, expected consolidated comprehensive income, and other effects influencing risk-bearing capacity, such as foreseeable changes in the capital structure and methodological developments in risk measurement. It also takes into account the impact of the expected economic development on the earnings position and risk situation.

The downturn and stress scenarios for normative and economic risk-bearing capacity simulate adverse effects on earnings or AFR and changes in capital requirements of varying severity extending beyond the developments already expected as of the key date or in the baseline scenario. While the downturn scenario assumes a slight deterioration in economic conditions, the stress scenario simulates a prolonged, severe global recession. In both scenarios, KfW assumes an increase in credit and equity investment risks and losses. In these scenarios, the EUR and USD interest rates as well as the EUR-USD exchange rate are forecast to develop in line with the economic situation. At the same time, it is assumed that increasing market uncertainties will lead to greater volatility in interest rates, currencies and credit spreads, which in terms of economic risk-bearing capacity may result in a rise in the economic capital requirement for the corresponding types of risk. Losses from operational risk further reduce available capital.

The scenarios are based on standardised global economic forecasts updated on a quarterly basis. In 2024, the ongoing effects of the Russian war of aggression against Ukraine and of weak economic growth in Germany were taken into account in KfW's regular stress calculations as key factors for the group's economic environment. In the scenarios, negative economic assumptions primarily lead to rating downgrades of KfW borrowers and thus to increasing risk provisioning and higher capital requirements for the portfolio segments affected.

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In addition to the regular economic stress calculations, specific potential threats to KfW were analysed in scenario stress tests in 2024, taking into account the current environmental, geopolitical, climate policy and macroeconomic situation. Four quarterly scenario stress tests on structural risks to the group were implemented as an expansion of the stress test programme. The Executive Board initially chose the effects of a crisis of confidence in the banking sector, trade barriers due to protectionism and geopolitical fragmentation, a debt crisis in developing countries and emerging economies and a rapid rise in carbon pricing on KfW's credit risk situations as potential risks. The structural risks were reviewed on a regular basis and redefined as necessary. In 2024, the ad hoc scenario stress tests focused on a scenario relating to a possible sovereign debt crisis in the European Union ("EU") and the re-election of Donald Trump as US president, with negative economic consequences for the EU economy as a result of an assumed trade war.

Moreover, the expansion of stress testing methods for ESG risks continued to be driven forward in 2024. In this context, a scenario was also conducted on the long-term effects of four carbon price scenarios on KfW's credit risk situation to assess transition climate risks in the corporates portfolio. A scenario was also prepared to assess physical climate risks in the form of damage and loss due to flooding and heavy rainfall events (implemented in Q1 2025). Lastly, a regular credit risk stress test was developed for the simultaneous assessment of physical and transition climate and environmental risks in the portfolio.

Besides the regularly simulated economic scenarios and the different scenario stress tests, further stress tests, in particular risk type-specific stress tests and various sensitivity analyses, are also regularly carried out, taking concentration risks into account, to analyse the resilience of KfW's economic and normative risk-bearing capacity. In addition, the concentration and inverse stress tests are intended to determine the limits of KfW's risk-bearing capacity.

The results of the various stress and scenario calculations were presented to decision makers at KfW in a separate digital stress test report.

The group met the economic risk-bearing capacity requirements, including the confidence level of 99.90% in the scenarios analysed, as of all quarterly calculation dates in 2024. The regulatory capital ratios and the leverage ratio exceeded the threshold values defined for risk appetite at all times.

KfW's stress testing programme is subject to an annual adequacy assessment, the aim being to further enhance the stress tests and scenario calculations as a component of overall bank management in order to meet internal and regulatory requirements.

Types of risk

Credit risk

KfW Group is subject to credit risk in the context of its promotional mandate. Credit risk includes, in particular, counterparty default risk (including migration risk), as well as counterparty risk, including CVA risk and settlement risk.

The majority of final borrower default risks are borne by the on-lending institutions in the domestic promotional lending business. Due to the business model, this results in a large proportion of bank risks in the portfolio. Other main risks result from promotional activities in the area of start-up finance for small and medium-sized enterprises (SMEs). Particularly in these segments of domestic promotion, KfW Group bears the risk stemming from final borrowers. In addition, KfW Group faces risks in the business sectors Export and project finance as well as Promotion of developing countries and emerging economies.

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Debtor level	Sovereigns	Banks	Enterprises
Rating procedures (Probability of default)	– Country rating	– Bank rating	– Corporate rating
– SME rating	– Special financing
– Structured products
– Retail
– Start-up rating
Business level	Exposure at default
	Loss given default
Portfolio level	Loan portfolio model

Counterparty default risk$^{3)}$ is measured by estimating the probability of default ("PD"), the exposure at default ("EAD") and the loss given default ("LGD"). The product of these three variables is the loss that can be expected, statistically, on average over many years.

KfW Group uses internal rating procedures to determine the probability of default for banks, countries, corporates, SMEs and start-ups. These procedures are based on scorecards$^{4)}$ and generally follow a uniform model architecture consisting of a machine rating, a checklist, a group logic and a manual override. Simulation and cash flow-based rating procedures are used for significant parts of special financing and structured products, some of which were licensed from an external provider. For structured products, tranche ratings are determined on the basis of the default pattern of the asset pool and the waterfall structure of the transactions. The existing small-ticket retail positions (e.g. in the area of education financing) are valued using an automated procedure set up specifically for this purpose. The rating procedures aim to predict the probability of default on a one-year basis. As a rule, the middle and back-office departments are responsible for preparing ratings for risk-bearing business. Ratings for these exposures are updated regularly, at least once per year. There are exceptions for loans below a threshold of EUR 10 million from the KfW special programmes in the context of the pandemic and the Russian war on Ukraine.

Mapping the probability of default on a uniform master scale for the entire KfW Group facilitates a comparison of ratings from different rating procedures and business sectors. The master scale generally consists of 20 distinct classes which are divided into four groups: investment grade, non-investment grade, watch list and default. The range of default probabilities and the average default probability are defined for each class of the master scale. There are operating procedures specifying the responsibilities, competencies and control mechanisms associated with each rating procedure. External ratings are mapped to KfW Group's master scale to ensure the comparability of internal ratings with ratings of external rating agencies. The rating procedures are validated and further developed at regular intervals.

3) Also includes counterparty risk

4) A scorecard is a mathematical and statistical model and/or an expert knowledge-based model. The individual risk factors considered relevant for credit rating are converted into a score depending on their prevalence or value and weighted for aggregation.

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EAD and valuation of collateral influence the severity of loss. Collateral has a risk-mitigating effect in calculating LGD. In valuing acceptable collateral, the expected net revenue from collateral realisation in the case of loss is determined. Haircuts to cover the credit risk of final borrowers are a major factor in the valuation of assignments made by financing partners in the on-lending business. For tangible collateral, further haircuts are applied for expected changes in value, as well as devaluation resulting from depreciation. Depending on the availability of data, the various valuation procedures for individual types of collateral are based on internal and external historical data and on expert estimates. In the case of personal collateral, the collateralised portion is treated as a direct transaction with the collateral provider, i.e. the probability of default and the extent of the collateral provider's uncollateralised loss are applied. A risk principle for loan collateral regulates uniform management, valuation and recognition of collateral across KfW Group. In addition to net revenue from collateral realisation, the recovery rate for uncollateralised exposure amounts is also an important component in determining LGD. The collateral valuation procedure and the procedure for estimating the EAD and LGD are also subject to validation and further developed as needed, with new regulatory requirements also addressed.

Settlement risks and counterparty risks (including CVA risk) $^{5)}$ arise for KfW in connection with derivative transactions when hedging interest and currency risks. Settlement risks arise if, after the bank's own transaction has been concluded, the derivative partner's counterpayment is not made. Derivative transactions also involve the risk of changes in value (counterparty risks including CVA risk), which can be caused by a change in the credit quality of the counterparty (credit risk including default risk), a change in the absolute price of the derivative (market price risk) or a combination of the two.

KfW Group has limit management systems, risk guidelines and various portfolio guidelines to limit risks from new business. This suite of risk management instruments forms the basis for the second vote on lending transactions, serves as an orientation guide for loan approvals and has the function of ensuring the appropriate quality and risk structure of KfW Group's portfolio while taking into account the special nature of KfW Group's promotional business. At KfW, Group Risk Management casts the second vote at single exposure level. KfW IPEX-Bank, KfW Capital and DEG each issue their own second vote independent of the front office. The relevant lending decision-making processes are structured with a view to risk. Lending transactions require a second vote depending on the type, scope of the risk content and complexity of the transaction. The qualification levels for approval of new business depend on rating, collateralisation or net exposure and total commitments to the group of connected customers. Approval of the responsible supervisory body is also required for individual transactions of pre-defined volumes.

The portfolio guidelines distinguish between different types of counterparties and product variants and define the conditions under which business transactions may be conducted. In addition, risk guidelines for countries, sectors and products are defined in order to react to existing or potential negative developments with specific requirements for lending. The limit management systems ultimately track both credit rating-dependent individual counterparty risk (counterparty limits) and risk concentrations (concentration limits). Counterparty limits serve to fine-tune the counterparty-specific management of credit default risk. Concentration limits serve to restrict risk concentrations in the loan portfolio and thus to prevent major individual losses. Due to KfW's business model, there is a significant concentration in credit risks, as well as in the financial sector.

Existing higher-risk exposures are divided into a watch list and a list for non-performing loans. The watch list serves to identify potential problem loans early. This watch-list process involves regularly reviewing and documenting the economic situation, the particular borrower's market environment and the collateral provided, and formulating and deciding proposals for remedial action as needed – particularly proposals for risk-limiting measures. Process responsibility for non-performing loans, and also to a large extent for watch-list exposures $^{6)}$, lies with restructuring units, ensuring involvement of specialists, intensive support and professional management of problematic loans. The objective of this system is to achieve recovery of a loan through restructuring, reorganisation and workout arrangements. If the business partner is deemed incapable of or unsuitable for restructuring, the priority becomes optimum realisation of the asset and the related collateral. The Restructuring division is responsible for non-performing loans and for providing

$^{5)}$ See section on "Economic risk-bearing capacity" for measurement of the economic capital requirement for credit risks.

$^{6)}$ The assumption of responsibility for watch-list cases at KfW IPEX-Bank is decided on a case-by-case basis by Risk Management in consultation with the unit responsible for restructuring.

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intensive support to banks and higher volume loans in the KfW portfolio with a risk amount greater than EUR 1 million. The Operations department is responsible for supporting retail business. Rules with differing details apply for the special programmes for coronavirus aid, which are fully backed by a federal guarantee. KfW IPEX-Bank's non-performing loans and exposures under intensive support, including KfW and DEG's trust activities, are managed directly by each subsidiary. Internal interface regulations are in place in the relevant business sectors to ensure control of responsibilities and allocation. Restructuring also cooperates with the front-office departments and the central Legal Affairs department.

In the event of a crisis in the banking sector, the bank must be able to act without delay both in-house and externally. A crisis plan for banks is in place for this purpose. It primarily provides for the establishment of a dedicated working group under the direction of the Credit Risk Management department and immediate loss analysis so that the necessary next steps can be implemented quickly.

Information on default risk and default risk concentrations (gross carrying amounts) as of 31 December 2024 – amortised cost

		Loans and advances to banks			Loans and advances to customers
		Stage 1 EUR in millions	Stage 2 EUR in millions	Stage 3 EUR in millions	Stage 1 EUR in millions	Stage 2 EUR in millions	Stage 3 EUR in millions
Investment grade	M1–M4 rating	245,839	0	0	48,896	80	0
	M5–M8 rating	55,777	0	0	45,627	0	0
Non-investment grade	M9–M15 rating	13,968	11	0	40,194	1,009	0
Watch list	M16–M18 rating	2,524	1,212	0	3,349	2,626	0
Default	M19–M20 rating	0	0	1,196	0	0	4,193
Total		318,108	1,223	1,196	138,066	3,714	4,193
		Securities and investments			Off-balance sheet transactions
---	---	---	---	---	---	---	---
		Stage 1 EUR in millions	Stage 2 EUR in millions	Stage 3 EUR in millions	Stage 1 EUR in millions	Stage 2 EUR in millions	Stage 3 EUR in millions
Investment grade	M1–M4 rating	31,195	83	0	83,260	59	0
	M5–M8 rating	6,341	0	0	36,776	0	0
Non-investment grade	M9–M15 rating	347	0	0	19,777	260	0
Watch list	M16–M18 rating	24	0	0	663	1,003	0
Default	M19–M20 rating	0	0	0	0	0	283
Total		37,907	83	0	140,475	1,322	283

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Information on default risk and default risk concentrations (gross carrying amounts) as of 31 December 2023 – amortised cost

		Loans and advances to banks			Loans and advances to customers
		Stage 1	Stage 2	Stage 3	Stage 1	Stage 2	Stage 3
		EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Investment grade	M1–M4 rating	237,861	0	0	48,554	3	0
	M5–M8 rating	61,980	0	0	33,045	0	0
Non-investment grade	M9–M15 rating	17,039	209	0	49,411	1,039	0
Watch list	M16–M18 rating	4,536	1,889	0	3,360	4,210	0
Default	M19–M20 rating	0	0	1,128	0	0	4,707
Total		321,416	2,098	1,128	134,370	5,252	4,707
		Securities and investments			Off-balance sheet transactions
---	---	---	---	---	---	---	---
		Stage 1	Stage 2	Stage 3	Stage 1	Stage 2	Stage 3
		EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Investment grade	M1–M4 rating	28,587	0	0	69,254	0	0
	M5–M8 rating	7,234	64	0	47,366	0	0
Non-investment grade	M9–M15 rating	133	0	0	20,106	1,110	0
Watch list	M16–M18 rating	47	0	0	501	737	0
Default	M19–M20 rating	0	0	0	0	0	455
Total		36,001	64	0	137,227	1,847	455

Credit risks and related credit protection of financial instruments measured at amortised cost as of 31 December 2024

	Maximum risk of default1)	Maximum risk of default stage 3	Risk mitigation from collateral stage 3
			tangible	personal
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Loans and advances to banks	320,406	1,144	9	1,106
Loans and advances to customers	144,278	2,917	54	2,297
Securities and investments	37,982	0	0	0
Off-balance sheet transactions	142,006	235	0	26
Total	644,672	4,297	62	3,428

1) Net carrying amount, excluding collateral and other credit enhancements

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Credit risks and related credit protection of financial instruments measured at amortised cost as of 31 December 2023

	Maximum risk of default1)	Maximum risk of default stage 3	Risk mitigation from collateral stage 3
	EUR in millions	EUR in millions	tangible EUR in millions	personal EUR in millions
Loans and advances to banks	324,475	1,044	9	1,013
Loans and advances to customers	142,644	3,484	87	2,765
Securities and investments	36,057	0	0	0
Off-balance sheet transactions	139,438	404	0	26
Total	642,613	4,932	96	3,803

1) Net carrying amount, excluding collateral and other credit enhancements

A large part of the personal collateral of the financial instruments classified as stage 3 comprises federal guarantees and credit insurance. Tangible collateral for financial instruments classified as stage 3 primarily consists of aircraft mortgages and individual assignments.

As a rule, the collateral for financial instruments measured at fair value relates almost entirely to the collateral for financial derivatives.

There were no significant changes to the quality/collateralisation policy and no financial instruments for which no impairments were recognised at all due to tangible collateral.

KfW Group did not take possession of any assets held as collateral nor did it realise any assets held as collateral in 2024.

Portfolio structure

The interaction of the risks associated with the individual exposures in KfW Group's loan portfolio $^{7)}$ is assessed based on an internal portfolio model. Concentrations of individual borrowers or groups of borrowers give rise to a risk of major losses that could jeopardise KfW Group's existence. On the basis of the economic capital concept, the Risk Controlling department measures risk concentrations by individual borrower, sector and country. Risk concentrations are primarily reflected in the economic capital requirement. The results of these measurements form the main basis for managing the loan portfolio.

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Economic capital requirement by region

31 December 2024 (31 Dec. 2023)

A = Germany
B = Euro area countries (excl. Germany)
C = EU countries (excl. euro area countries)
D = Europe outside EU
E = Africa
F = Asia/Australia/New Zealand
G = Latin America
H = North America

Regions

As of 31 December 2024, 70% of KfW Group's loan portfolio in terms of economic capital requirements was attributable to the euro area, including Germany (31 Dec. 2023: 70%). The breakdown of the economic capital requirement across regions is virtually unchanged from the previous year.

Economic capital requirement by sector

31 December 2024 (31 Dec. 2023)

A = Banks
B = Industrial enterprises
C = Retail
D = Non-basic consumer goods
E = Utilities
F = Finance
G = Communication services
H = Other

Sectors

The significant share of the total capital requirement for credit risk attributable to banks is due to KfW Group's promotional mandate. By far the greatest portion of KfW Group's domestic promotional business consists of loans on-lent through commercial banks. Overall, the banks' share of the economic capital requirement increased slightly to 60% (31 Dec. 2023: 58%).

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Credit quality by net exposure

31 December 2024 (31 Dec. 2023)

A = Investment grade
B = Non-investment grade
C = Watch list
D = Default

Credit quality

As credit quality is a major factor influencing economic capital requirements, analysing credit quality structure involves examining the distribution of net exposure$^{8)}$ by credit quality category. The credit quality structure of the portfolio was stable year on year.

Overview of ESG credit risks

For the first time, a large part of the loan portfolio was assessed in terms of ESG risk. The ESG risk assessment of the group's loan portfolio shows that the majority of the KfW portfolio has low or moderate E, S and G risks. Financial institutions with a low risk rating for environmental and governance account for a large proportion of the volume assessed. In the 'social' risk ratings, the financial institutions achieved a moderate risk rating overall based on assessments corresponding to data security and protection of customer privacy.

Average E, S and G scores with scale values

Share of assessed net exposure as of 31 Dec. 2024

ESG risk rating/scale values

A = Very low
B = Low
C = Moderate
D = Increased
E = High
F = Very high

Securities-based securitisations in KfW Group's portfolio

Securitisations had a par value of around EUR 6.8 billion as of 31 December 2024. Accounting for the mark-to-market valuation of the securities reported at fair value and impairments, the portfolio had a book value (including pro rata interest) of around EUR 6.8 billion. The following tables present the composition of the securitisation portfolio by asset class, rating grade and geographical distribution.

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Geographical breakdown of the underlying asset pool (based on par value)

	31 Dec. 2024	31 Dec. 2023
	%	%
Europe	100.0	100.0
World	0.0	0.0
North America	0.0	0.0
Africa	0.0	0.0
Asia	0.0	0.0

Exposure based on par values

	ABCP	Auto-ABS^{1)}	RMBS	Other securitisations	Total as of 31 Dec. 2024	Total as of 31 Dec. 2023
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Investment grade	4,415	1,755	517	103	6,790	6,167
Non-investment grade	0	0	0	0	0	0
Watch list	0	0	0	0	0	0
Default	0	0	0	7	7	7
	4,415	1,755	517	110	6,797	6,174

1) Auto ABS are based on receivables from automotive financing agreements

The portfolio volume increased compared to the volume of 31 December 2023 (by a nominal value around EUR 0.6 billion). This increase related solely to the investment grade portfolio. In terms of the geographical breakdown of the underlying asset pool, the entire portfolio remains fully attributable to Europe, with Germany accounting for the lion's share.

Equity investments risk

In managing group equity investment risks, the group differentiates between risks from equity investments at operational level and strategic equity investments:

Equity investments (operational level)

Undertaking equity investments at an operational level is part of the group's promotional mandate. Accordingly, equity investments are made in connection with domestic and European investment financing and in the business sectors KfW Development Bank, DEG and Export and project finance, and fund investments of KfW Capital. KfW's group-wide basic rules for equity investments at an operational level are set out in general guidelines. Specific rules tailored to certain segments of equity investments are also set out in portfolio guidelines or working instructions. Risks are measured at the individual loan commitment level for operational equity investments using models specified for this purpose. Equity investment portfolio risks are monitored quarterly in the group risk report.

Strategic equity investments

Strategic equity investments support KfW's mandate of providing an efficient and sustainable promotional offering. In addition to reinforcing and expanding core competencies, the focus of this investment type is on complementing KfW's business sector (Article 2 (3) of the KfW Law [related transactions]). Strategic equity investments normally have a long-term holding period. KfW also makes strategic equity investments in accordance with Article 2 (4) of the KfW Law (mandated transactions). The Federal Government mandates such equity investments to KfW on a case by case basis because the Federal Republic of Germany has a state interest in them.

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Dedicated organisational units are responsible for strategic equity investments based on an equity investment manual that describes legal bases, strategies, principles, procedures and responsibilities of equity investment management. Acquisitions and disposals of, and changes to, strategic equity investments are subject to defined processes as well as authorisation by the Executive Board and, in the cases covered under the KfW Bylaws, authorisation by the Board of Supervisory Directors. Moreover, KfW's acquisition of a strategic equity investment in excess of 25%, creating or increasing such an equity investment or fully disposing of it requires authorisation by the Federal Ministry of Finance in accordance with Section 65 (3) of the Federal Budget Code (Bundeshaushaltsordnung). Strategic equity investments and their individual risks are monitored and presented to the Executive Board as part of an annual strategic equity investment report, as well as in drafts and ad hoc reports, if necessary. The equity investment strategies to be tailored individually and in line with the business strategy address, among other things, the grounds for each investment in accordance with promotional policy; the commercial impact; the holding period and exit strategies. Equity investment strategies are updated on an annual basis. Moreover, the group is normally represented in the supervisory bodies of its strategic equity investments. Mandated transactions – that is, those executed in the interest of, on the instruction of and at the risk of the Federal Government – may deviate from these provisions.

As of 31 December 2024, the group's equity investment portfolio consisted of fund investments of KfW Capital with an economic capital requirement of EUR 344 million, equity investments of DEG including promotional business with an economic capital requirement of EUR 802 million, and other promotional business (economic capital requirement: EUR 553 million).

The EUR 272 million decrease in the capital requirement compared to the previous year was mainly due to further methodological development of the ECAP equity investment risk (including revision of the value distribution and consistent exposure modelling for investment funds) as well as automated linking of KfW Capital's fund holdings and the associated replacement of the conservative ECAP calculation.

Market price risk

KfW Group primarily measures and manages market price risk on a present-value basis. The drivers of market price risk are interest risk (consisting of the jointly analysed risk subtypes interest risk, tenor and cross-currency basis spread risk), interest rate volatility risk, foreign currency risk and sector-specific spreads for positions with credit spread risk.

Market price risk within the group required a total of EUR 6.26 billion in economic capital as of 31 December 2024. This was EUR 0.64 billion more than as of 31 December 2023. Volatile markets and the expansion of the strategic interest rate risk position have the effect of increasing overall market price risk, particularly interest risk. Interest rate volatility risk was lower due to an adjustment in calculation methodology.

Economic capital requirement for market price risk

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Interest risk	6,147	5,453
Interest risk	6,078	5,415
Tenor basis spread risk	403	348
Cross-currency basis spread risk	520	483
Breakdown effect	-855	-793
Interest rate volatility risk	162	251
Foreign currency risk	703	590
Credit spread risk	731	870
Breakdown effect	-1,488	-1,549
Market price risk	6,255	5,615

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Value-at-risk approach

The economic capital requirement for the market price risk is calculated based on the VaR model of the historical simulation. The risk is calculated taking account of diversification effects between the risk subtypes. The possible loss of present value is determined based on the historical simulation. The model consists of two components – a reactive short-term and a conservative long-term component. The reactive component is based on a historical simulation over a one-year market data history (250 scenarios) and thus in particular reflects current market events. The conservative component is based on a historical simulation over a five-year period selected from a long-term history, which includes stress periods and thus incorporates a long-term perspective.

The ECAP for market price risk and risk subtypes is calculated from the maximum of the two components, based on a holding period of one year and a confidence level of 99.9%.

VaR indicators are determined for each of the following subtypes of market price risk: interest risk (further broken down into the risk of changes in the interest rate, tenor and cross-currency basis spread risks), foreign currency risk, interest rate volatility risk and credit spread risk). The total VaR is also calculated, taking account of breakdown effects between the aforementioned risk subtypes. The total VaR, interest risk, interest rate volatility risk, credit spread risk and foreign currency risk are limited.

Interest risk

Yield curve grid points serve as the basis for historical simulation to quantify interest risks. These implicitly include interest risk as well as tenor and cross-currency basis spread risks. By contrast, interest rate volatility and credit spread risks are not included in interest risk, but are modelled separately and reported using their own key VaR indicators. The capital requirement for interest risk increased by EUR 694 million to EUR 6,147 million as of 31 December 2024.

Interest rate volatility risk

Implied volatilities are used as risk factors to determine the interest rate volatility risk. These are applied in modelling interest rate options (e.g. floors in the variable-rate lending business). The economic capital requirement for these risks is calculated in the same way as for other sub-types of risk, using historical simulation; see above, Value-at-risk approach. The ECAP requirement for interest rate volatility risk cannot exceed the present value of the corresponding interest rate options held by KfW. The capital requirement for interest rate volatility risk was EUR 162 million as of 31 December 2024.

Foreign currency risk

The economic capital requirement for foreign currency positions is also calculated using historical simulation. The capital requirement for foreign currency risk stood at EUR 703 million as of 31 December 2024.

Credit spread risk

This risk is mainly determined by the securities portfolio. The ECAP requirement for this risk type is calculated in the same way as for other risk types, using historical simulation. The ECAP requirement for credit spread risk as of 31 December 2024 was EUR 731 million. Credit spread risk fell by EUR 139 million year on year due to the first-time inclusion of credit spreads in the present value measurement of pension provisions.

Stress testing

In addition to the calculation of the ECAP requirement based on the VaR model of historical simulation, the effects of extreme market situations on the present value and VaR target variables are determined by means of stress tests.

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Market price risks IRRBB and CSRBB with regard to earnings

In addition to present-value measurement of market price risk, interest rate-induced risks are measured with regard to the bank's periodic earnings. The earnings-oriented interest risk ("IRRBB") comprises market interest rate-induced fluctuations in net interest income, referred to as delta net interest income ("delta NII"). The delta NII is influenced by the strategic interest rate risk position and effects in the variable interest book. Measurement and monitoring is based on a dynamic simulation model with the change between the planned base case and the scenarios specified by the European Banking Authority calculated as the delta NII. The interest risk also manifests itself in market interest rate-induced fluctuations in the measurement of pension provisions, referred to as delta other comprehensive income ("delta OCI"), which is recognised directly in equity. As of 31 December 2024, the worst case scenario is EUR -91 million in delta NII and EUR -837 million in delta OCI.

The earnings-oriented credit spread risk ("CSRBB") monitors existing or future risk to earnings arising from unfavourable credit spread movements in two components: the funding cost risk from changes in KfW's own credit spread as delta NII, and the credit spread risk from the remeasurement of pension provisions as delta OCI, which is not recognised in the income statement. As of 31 December 2024, the worst-case scenario was EUR -328 million in delta NII and EUR -362 million in delta OCI.

Operational risk

In accordance with Article 4 (1) no. 52 of the CRR, the group defines operational risk as the negative impact on net assets (including capital adequacy), earnings position or liquidity that can result from inadequate or failed internal processes, people and systems or from external events. Operational risks are monitored by a central Risk Controlling unit. The methodology behind the models and procedures used for measurement and monitoring is adjusted on a regular basis. In addition, the operational risk subtypes are monitored by specialised second line of defence units.

According to the 2024 risk inventory, compliance risk and information security risk are categorised as material; business continuity risk and legal risk are no longer material due to lower quantitative risk content $^{9),10)}$.

The aim of management and control of operational risk is the proactive identification and averting of potential losses for the group, i.e. to make emergencies and crises manageable and to secure the group's structural ability to remain operational even in the event of loss of key resources.

Management of risks is decentralised and performed within the business sectors and subsidiaries by the respective directors or members of management, who are supported by the respective sector coordinators for Operational Risk ("OpRisk") and Business Continuity Management ("BCM"). Monitoring and communication of risks is performed on a cross-functional basis by Risk Controlling (central OpRisk Controlling) and Transaction Management (central BCM). These staff develop the relevant methods and instruments for identifying and assessing risks and monitor their group-wide uniform application. The model for calculating the economic risk resulting from operational risks is also validated in the Risk Controlling department.

Events in the group are recorded in an OpRisk event database and updated when changes or developments occur. There is regular target group-appropriate reporting on the recorded loss events and any measures initiated as a result. The Executive Board, the Board of Supervisory Directors and the Operational Risk Committee are briefed monthly or quarterly as part of internal risk reporting. Ad hoc reports are also made if a loss exceeds a certain level.

In addition, potential operational risks are identified based on risk scenarios that are collected from across the group. Operational risks are evaluated on the basis of expert assessments in combination with internal and external loss events as well as internal data (e.g. transactions), which are backed by a distribution assumption for loss frequency and loss amount. The results of the annual risk assessment and the calculated risk scenarios are reported to the Operational Risk Committee and the Executive Board. As part of the risk assessment, the business areas check the implementation of additional risk-mitigating measures (e.g. checks as part of the internal control system, or "ICS").

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Where adequate monitoring of operational risks using metrics is possible, risk indicators are used. Compliance with centrally prescribed risk-mitigating requirements (e.g. training course participation, deadlines, escalation procedures) is monitored by the overarching Controlling function using business area-specific OpRisk information dashboards to ensure escalation across all levels up to the Executive Board in the event of non-compliance.

The 2024 risk assessment was carried out from April to November 2024. The overall effect on the ECAP for the year was a reduction of around EUR 6 million.

Business continuity risk

Business continuity risk refers to the negative impact on net assets (including capital adequacy), earnings position or liquidity due to the non-continuation of time-critical business processes in the event of a business interruption resulting from a previous failure to fulfil business continuity requirements. The aim of BCM is to make provisions for time-critical business processes in case of emergency.

BCM is implemented if a business interruption occurs due to internal or external events. This is an integrated management process which covers the four outage and loss scenarios: site outages, IT system outages, staff outages and service provider outages. BCM incorporates preventative components (emergency preparedness) and reactive components (emergency and crisis management).

For the purpose of BCM, business processes are analysed and categorised based on how time-critical they are, and the supporting resources for each case examined accordingly. Identifying such time-critical business processes and their dependency on supporting resources forms the basis for effective BCM. Individual measures are developed for these business processes and their supporting resources, in order to be able to guarantee the required availability and reduce business risks. These include emergency workstations, emergency plans, communication tools and alerts/alarms. KfW Group's crisis team takes responsibility for overall crisis management if necessary. It practises emergency and crisis organisation teamwork in regular crisis team tests.

Information security risk

Information security risk ("IS risk") refers to the uncertainty involved in achieving the respective protection targets (confidentiality, integrity and availability) of information assets and the resulting potential adverse effect on the group's net assets (including capital adequacy), earnings position or liquidity. An IS risk occurs precisely when a threat (e.g. a cyber-attack) is accompanied by a vulnerability (e.g. planned protection measures that have not been implemented). Cyber risks are risks that occur when navigating an interconnected digital environment (cyberspace). Cyberspace refers to all information technology networks connected to the Internet (or comparable networks) involving a digital or electronic information asset of the bank. Information security risks are associated with KfW's operating activities. The aim of risk management is to mitigate the impact of potential threats, reduce the probability of their occurrence and thus counteract risks through risk-mitigation measures. The information security management system ("ISMS") is based on the international standard ISO 27001. IS risks are controlled with the aid of ISMS risk indicators and performance benchmarks.

Compliance risk

Compliance risk is defined as the risk of legal or regulatory sanctions or negative effects on net assets (including capital adequacy), earnings position or liquidity arising from non-compliance with external or internal requirements, voluntary commitments or legal regulations, which contribute to the following aspects of operational compliance:

fraud and corruption risk; risk of criminal activities,
securities compliance and conflict of interest risk in provision of investment services,
money laundering/terrorist financing risk,
risk of breaching embargoes or sanctions,
and tax compliance risk,

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or which fall under the overall process of compliance with minimum requirements for risk management (Mindestanforderungen an das Risikomanagement – “MaRisk”) as published by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – “BaFin”), in accordance with MaRisk AT 4.4.2. The processes for identifying, assessing, controlling and monitoring compliance risk, including the aspects listed above, are part of the Compliance Management Framework (“CMF”). This includes minimum requirements both for implementing regulatory requirements and for ensuring appropriate group-wide risk management. Under the CMF, the Compliance department acts as a second line of defence to ensure that risks of material rule violations are identified promptly and mitigated.

Legal risk

Legal risk refers to negative effects on net assets, (including capital adequacy) earnings position or liquidity arising from the infringement of or non-compliance with formal or substantive laws insofar as this leads to legal disputes or action to avoid legal disputes. Infringement or non-compliance may be due in particular to legal adjustments or changes with retroactive effect, misinterpretation or misapplication of formal or substantive laws or incorrect drafting of agreements. Financial consequences of tax law risks are not included.

KfW Group manages its risk appetite with regard to legal risks on a primarily qualitative basis, supplemented by individual quantitative elements, as is standard for the market. The core of qualitative management is process-integrated legal advice from in-house counsel, involving external law firms if necessary. This is accomplished for the group on the basis of the policies of the relevant KfW subsidiaries (KfW IPEX-Bank, DEG and KfW Capital), which are based on the policies of KfW, through the centralisation of certain key legal issues at KfW and, in general, through the Legal Board established for this purpose.

A group-wide key risk indicator has been defined as a quantitative control element, which is essentially focused on monitoring risks arising from certain (impending) legal disputes.

Reputational risk

Reputational risk is the risk that the perception of the group from the point of view of the relevant internal and external stakeholders will deteriorate for the long term with a negative impact on KfW Group. This negative impact could lead to a decrease in KfW Group's net assets, earnings or liquidity (e.g. a decline in new business) or may be of a non-monetary nature (e.g. difficulty in recruiting new staff). Reputational risk may arise as a consequence of other types of risk, or independently.

Reputational risk is categorised as a non-material risk type in the risk inventory. Due to KfW's special role and business model, this risk type is nevertheless of particular importance, which is why its treatment is essentially unchanged throughout the risk management cycle.

Reputational risks are managed based on qualitative criteria. This reflects both stakeholders' expectations and the bank's self-image of adhering to all relevant ethical, governance, environmental and compliance standards. In recent years, an internal method was developed to incorporate reputational risk into the decision-making process for financing and investments based on uniform standards; this method is gradually being rolled out in the KfW Group entities.

Moreover, as part of risk identification, the central reputational risk control function coordinates qualitative reputational risk assessment and creates a risk profile outlining the group's greatest reputational risks relating to the bank's most important stakeholders. In addition, reputational risk events that have occurred are reported on an ongoing basis.

Liquidity risk

Liquidity risk in the narrower sense (synonymous with insolvency risk) is the risk of a lack of liquidity on the part of an institution or market. The liquidity gap creates the risk that payment obligations cannot be met, cannot be met on time or cannot be met in full.

The primary objective of liquidity management is to ensure that KfW Group is capable of meeting its payment obligations at all times. KfW is available as a contractual partner for all commercial transactions of its subsidiaries, particularly for their funding. For this reason, the liquidity requirements of the subsidiaries are included both in KfW Group's funding plans and in the liquidity maintenance strategy.

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Liquidity risk is measured on the basis of economic scenario analyses. Moreover, maximum liquidity gap limits (outflows on a monthly and yearly basis), available liquidity (liquidity potential) and the difference between the average residual maturity of inflows and outflows (maturity gap) are monitored. On the basis of the KfW Law, KfW's liquidity risks are limited by the utilisation threshold in accordance with Article 4 of the KfW Law. The utilisation threshold compares current and non-current liabilities and must not exceed 10%. Internal indicators relating to the liquidity situation are based on comparing liquidity requirements and liquidity potential as a ratio in stress scenarios of differing severity. No capital is currently allocated as part of calculating risk-bearing capacity.

Internal liquidity adequacy assessment process

The internal liquidity adequacy assessment process ("ILAAP") principle describes the management and monitoring of KfW Group's liquidity risk position. The procedure established by the institution serves to identify, measure, manage and monitor liquidity. The aim of the ILAAP is to ensure liquidity and avoid liquidity bottlenecks. It also assesses internal governance and institution-wide controls.

Insolvency risks are mainly limited through economic liquidity risk ratios and limits for liquidity potential and liquidity gaps. The aim of the liquidity risk strategy is to preserve the ability to meet payment obligations at all times and when due, even in stress scenarios.

Internal measurement of liquidity risk is based on scenario calculations. This approach first analyses the expected inflow and total outflow of payments for the next 12 months based on business already concluded. This baseline cash flow is then supplemented by planned and estimated payments (e.g. borrowings from the capital market, expected liquidity-related loan defaults or planned new business). The result provides an overview of the liquidity required by KfW Group over the next twelve months. The liquidity required is calculated for different scenarios. In this respect, market-wide and institution-specific risk factors are stressed, and an evaluation is made of the impact on KfW Group's liquidity.

Parallel to the above approach, KfW Group also determines the available liquidity potential, which largely consists of KfW's account with the Bundesbank, repurchase agreement assets, the liquidity portfolio and the volume of commercial paper that is regularly placeable on the market. The available liquidity potential is subjected to stress analysis in the same way as the other cash flow components. The ratio of cumulative required liquidity to the cumulative available liquidity potential is calculated for each scenario. This figure may not exceed the value of 1 in any scenario for any period. The prescribed horizon in the normal case scenario is twelve months, in the stress case six months, and in the two worst case scenarios, three months. The scenario assumptions are validated on an annual basis.

The indicators are calculated and reported to the Market Price Risk Committee on a monthly basis. The following table presents the risk indicators for the scenarios as of 31 December 2024:

KfW liquidity risk indicators

	31 Dec. 2024	31 Dec. 2023
	Indicator	Indicator
Normal case	0.20	0.37
Stress case	0.24	0.37
Worst case (institution-specific)	0.29	0.36
Worst case	0.48	0.59

The internal liquidity risk indicators remained below the internal limit of 1 throughout the year.

KfW continued to support the energy sector through the extension of loans on behalf of the Federal Government in 2024. This funding requirement was addressed through a refinancing facility from the Economic Stabilisation Fund (Wirtschaftsstabilisierungsfonds) and liquidity coverage potential provided by the German Finance Agency in the form of ECB-eligible German government securities.

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Current funding environment

In a capital market environment once again characterised by many political uncertainties, KfW generated a total issue volume (net proceeds) of EUR 78.1 billion on the international capital markets in financial year 2024 (2023: EUR 90.2 billion). There were 145 individual transactions (2023: 186). KfW issued bonds in a total of eight different currencies, with around 86% of long-term borrowing taking place in the two main funding currencies – euros (around 62%; 2023: 54%) and US dollars (around 25%; 2023: 29%).

KfW issues commercial papers ("CP") with maturities of up to one year on the money market through two CP programmes. The programme volume of the Multi-Currency Commercial Paper programme, also known as the Euro Commercial Paper ("ECP") programme designed for global investors amounted to EUR 90 billion. At EUR 46.3 billion, the nominal volume issued under this programme in 2024 was lower than in the previous year (EUR 72.4 billion) due to the favourable liquidity situation. At 113 days, the average term of the issues was also shorter than in the previous year (144 days). The volume outstanding on the reporting date of 31 December 2024 was EUR 23.1 billion. The programme volume of the U.S. Commercial Paper ("USCP") programme came to USD 30 billion in 2024. KfW Group uses this programme, which is designed specifically for the US market, to cover a large portion of its need for short-term funds in US dollars. The nominal volume issued under the USCP programme was also lower than in the previous year at USD 34.9 billion (2023: USD 40.8 billion). At 53 days, the average term of the issues was similar to that of the previous year (52 days). The outstanding volume amounted to USD 9.3 billion as of 31 December 2024.

Concentration risk

Concentration risk refers to the risk of negative effects on net assets, earnings position and liquidity arising from particularly large individual risk exposures or increased correlations of risk exposures. A distinction must be made between intra-risk concentrations (affecting one type of risk) and inter-risk concentrations (affecting different types of risk). Risk definitions were worded with as little overlap as possible in a further developed risk inventory, resulting in concentration risk being discontinued as an independent risk type. Risk concentrations continue to be recognised both within and between risk types. In line with the on-lending principle enshrined in the KfW Law, KfW's risk profile is essentially characterised by a tendency towards high exposures to individual bank counterparties and the financial sector as a whole. The resulting intra-risk concentrations are limited based on the defined risk appetite and are subject to stress tests. Additionally, KfW's business model as a promotional bank inevitably involves concentrations of earnings, which are addressed by monitoring the risk appetite for performance and earnings. Inter-risk concentrations are taken into account as part of the stress scenarios for risk-bearing capacity.

Regulatory risks

Regulatory risks for KfW Group arise primarily from an increase in requirements regarding minimum capital ratios and from possible negative effects on the group's business model due to future changes in the regulatory environment. These include the costs resulting from the implementation and ongoing fulfilment of the additional requirements as well as the associated capital tie-up. As part of the capital adequacy process, regulatory risk is addressed on an ad hoc basis by means of a regulatory scenario through conservative traffic-light limits as a management and early warning instrument with regard to regulatory capital requirements. Risk definitions were worded with as little overlap as possible in a further developed risk inventory, resulting in regulatory risk being discontinued as an independent risk type.

Regulatory monitoring ensures that new regulatory standards that are foreseeable or under discussion are addressed. Transparency regarding material effects of new regulatory requirements is provided in capital planning.

Intra-group risk

Due to the risk relevance for the group and the objective of consistent group management, the risks of KfW IPE-Bank, DEG and KfW Capital are fully taken into account as part of group risk management. Risk definitions were worded with as little overlap as possible in a further developed risk inventory, resulting in intra-group risk being discontinued as an independent risk type. In accordance with regulatory consolidation within the individual risk types, the risks of subsidiaries are included in the group-wide limits using a look-through approach and are integrated in the group's capital allocation and risk-bearing capacity calculation. In addition, representatives of the subsidiaries are members of the group's risk committees. KfW also monitors the risk situation of its subsidiaries on a stand-alone basis. The management of each subsidiary reports regularly to the responsible members of the Executive Board on risk, as well as finance and strategy. KfW's Executive Board is also informed of the intra-group risk situation in a quarterly report.

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Model risk

KfW employs models as an essential component for risk measurement and capital management, for calculating the effects of stress tests, and more generally for model-based business management overall. Using models means there are model risks, which can affect other types of risk such as credit or market price risk. Model risk was therefore once again identified as a material overarching risk in the 2024 risk inventory, since direct and considerable impacts on net assets, earnings position or liquidity can arise from weaknesses or errors at both model and model interaction level. Identifying and managing model risks is aimed at ensuring adequate control of model risks and timely and risk-oriented elimination or compensation of (systematic) model weaknesses that have been identified, particularly through independent validation, and at promoting an appropriate risk culture for dealing with models. Model risk is compensated by capital buffers in the economic risk-bearing capacity and individual adjustments at the model level, such as valuation reserves and manual adjustments, or by taking margin of conservatism premiums into account in model parameterisation. The annual model risk report gives the KfW Executive Board an overview of the entire model landscape with further details of the models in focus, as well as a general assessment of model risks at KfW. The ongoing management of model risks is carried out both through active performance of the individual model roles and through discussions and decisions in the risk committee meetings that regularly take place.

Additional internal control procedures

Process-integrated internal control system (ICS)

The aim of KfW Group's ICS is to use suitable principles, measures and procedures to ensure the effectiveness and profitability of business activities, compliance with the legal requirements applicable to KfW Group, the accuracy and reliability of external and internal accounting, and the protection of assets. There are group-wide ICS rules as well as binding group-wide minimum requirements of the ICS. KfW Group's ICS is based on the relevant legal (bank regulatory) requirements $^{11)}$, in particular those set forth in the KWG and MaRisk, and the standard market ICS framework, such as the COSO model $^{12)}$. The KfW Executive Board holds overall responsibility for the group's ICS. The respective company management of the subsidiaries KfW IPEX-Bank, KfW Capital and DEG holds overall ICS responsibility. Design and implementation at the different corporate levels are the responsibility of the relevant managers according to the organisational structure. Procedural rules form the basis of the ICS. These constitute the framework for a proper business organisation within KfW Group, in the form of a binding policy. Workflow organisational measures and controls are intended to ensure that monitoring is integrated into processes. Monitoring measures integrated into processes serve to avoid, reduce, detect and correct processing errors or financial loss. The effects of any planned changes to operational processes and structures on the procedure and intensity of monitoring are analysed in advance. KfW Group has implemented accounting-related controls to minimise the risk of error in stand-alone and consolidated financial statements and ensure the correctness and reliability of internal and external financial reporting. The accounting-related controls are part of the ICS. To ensure the adequacy and effectiveness of the ICS, KfW regularly scrutinises and continually refines its standards and conventions. A report is rendered annually to KfW Group's supervisory bodies. The adequacy and effectiveness of the ICS is also assessed by Internal Auditing on the basis of risk-based audits carried out independently of group procedures.

Compliance

The Executive Board bears overall responsibility for compliance within the Group. The Executive Board delegates the associated tasks to the Compliance department. The officers appointed by the Executive Board for the relevant areas of responsibility are located in the Compliance department. They include, in particular, the (group) money laundering officer, the fraud officer (central unit in accordance with Section 25h KWG) and the company data protection officer. The Compliance organisation is structured in accordance with a Three Lines of Defence model; as the second line of defence, it is aligned with the requirements for a MaRisk compliance function. In this context, group compliance has in particular included measures to adhere to data protection regulations and tax compliance, as well as measures to prevent insider trading (securities compliance), general conflicts of interest (conflict of interest risk), money laundering and terrorist financing and criminal activities, to comply with sanctions and embargo regulations, and to monitor legal requirements and the associated implementation measures (overall MaRisk compliance process in accordance with MaRisk AT 4.4.2). There are therefore binding rules and procedures that influence the day-to-day

11) See Section 25a (1) no. 1 KWG, MaRisk AT 4.3, and Sections 289 (5), 315 (2) no. 5, 324, and 264d HGB

12) COSO = Committee of Sponsoring Organizations of the Treadway Commission

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implementation of values and the corporate culture, which are updated regularly and on an ad hoc basis to reflect current law as well as market requirements. The aim is to manage and assess compliance risks as part of non-financial risks, among other things, by means of key indicators in line with the central requirements for operational risk management. Since the entry into force of the material requirements of the Supply Chain Act (Lieferkettensorfgaltspflichtengesetz) on 1 January 2023, the compliance organisation has also acted as a central point for recording, monitoring and controlling compliance with the related requirements. Within the scope of its duties as second line of defence, Compliance is responsible for and authorised to ensure implementation of statutory or regulatory requirements and Executive Board decisions, to analyse individual cases/irregularities, to coordinate necessary measures and, where applicable, to initiate ad hoc measures to limit damage. In relation to all other areas of the group, the Compliance department performs its tasks autonomously and independently and is not subject to any instructions, in particular with regard to analysis (including evaluation of results), monitoring activities, defining and implementing rules and measures, and reporting. In order to perform its duties, Compliance has a complete and unrestricted right to information, inspection and access to all premises, documents, records, audio recordings and systems. Where necessary, internal auditing and monitoring processes of the compliance organisation have been adapted to the changed risk situation (for example, regarding the Russian war on Ukraine and the Gaza war resulting from the Hamas attack). Group-wide task forces were also formed for this purpose where necessary. Compliance monitors legal and regulatory requirements on an ongoing basis and, as necessary, adapts them to the changed risk situation in coordination with the affected functions of the first line of defence.

Internal Auditing

Internal Auditing is an instrument of the Executive Board. As an entity that works independently of KfW Group procedures, it audits and assesses all of KfW Group's processes and activities to identify the risks involved and reports directly to the Executive Board. With a view to risk management processes, Internal Auditing performed an audit in the reporting year of the decentralised risk management processes and central aspects of risk management and risk control which were relevant group-wide. With regard to risk management, the focus areas of the audit included the application, operation and further development of the models used in risk management across all risk types, as well as KfW's combined risk assessment within the ICAAP. Additionally, risk-type-specific audits were performed on the management of operational risk and credit risk. Audits of key second line functions were also part of the 2024 audit plan. The risk management projects that Internal Auditing assessed as material were supported by Internal Auditing, maintaining the latter's impartiality and avoiding any conflicts of interest. Moreover, Internal Auditing continued to monitor the ongoing development of risk measurement procedures in 2024 by attending meetings of decision-making bodies (as a guest). Internal Auditing also functions as KfW Group's internal auditing department. It is involved in subsidiaries' audit planning. In addition to the audit results obtained independently in group-wide audits, it also incorporates the audit results of third parties (group auditors, BaFin and the internal auditing departments of the other group companies) in its group-wide internal audit reporting, in the tracking of measures and as a source of information when preparing its own audits.

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Forecast and opportunity report

General economic environment and development trends

KfW expects global real gross domestic product ("GDP") to grow by 3.1% year on year in 2025, after increasing by 3.2% in 2024, according to International Monetary Fund ("IMF") estimates. The growth rate of real GDP in 2025 for industrialised countries is expected to be at prior-year level, and for developing countries and emerging economies, a lower growth rate than the prior year is forecast (see table "Gross domestic product at constant prices"). The IMF's forecasts show that global consumer price inflation is expected to fall from an annual average of 5.7% in 2024 to an annual average of 4.2% in 2025. This means that the inflation rate for industrialised countries in 2025 is expected to be 5.2 percentage points below and that of the developing countries and emerging markets 4.0 percentage points below the highest rate of the past ten years, which was reached in 2022. KfW agrees with the IMF's assessment that the economic outlook will be determined by the extent of geoeconomic fragmentation, fiscal and monetary policy decisions and their international impact, and the ability of governments to implement structural reforms.

Gross domestic product at constant prices

Year-on-year change	2024 estimate	2025 forecast	2014–2023 average
	in %	in %	in %
Global economy*	3.2	3.1	3.1
Industrialised countries*	1.7	1.7	1.9
Developing countries and emerging economies*	4.2	4.1	4.0

Aggregation of annual GDP growth rates at each country's constant prices based on the shares of each country's GDP valued at purchasing power parity ("PPP") in the corresponding aggregate. Grouped into industrialised countries and developing countries/emerging economies based on IMF classification. The average is calculated as the geometric mean of annual growth rates.

Further global economic development is subject to great uncertainty, with the IMF of the opinion that the risks of worse-than-expected development predominate. For one thing, the latest global interest rate hikes may have an even greater impact than expected and adversely affect the propensity for consumption and investment. For another, inflation could prove to be more persistent than forecast, which would delay monetary easing. In the USA in particular, a more expansionary fiscal policy than expected could be a contributing factor. If commodity prices are more volatile than forecast or rise, due to climate-related and geopolitical shocks as well as regional conflicts, this could boost inflation, particularly in commodity-importing countries. Higher inflation rates could foster social unrest with negative consequences for growth and implementation of necessary structural reforms. A potential reassessment of monetary policy outlooks by the financial markets would potentially tighten global financing conditions and lead to disorderly repricing in assets. If risks are reassessed and risk premiums are consequently increased, this could also result in greater debt stress in developing countries and emerging markets. At the same time, forced fiscal consolidation would have the potential to hamper a fragile recovery. Intensified trade conflicts and protectionist policies beyond the expected level could disrupt international value chains and impede technical progress. And there is not least a risk that China's real estate crisis could unexpectedly escalate and the ensuing economic downturn could have a negative impact on other national economies.

There is also a possibility that the global economy will grow faster than forecast. This would happen if there were an unexpected dramatic improvement in consumer confidence or if, fuelled by the green transformation, government investment were to increase further than forecast and were to also be accompanied by private investment. Global economic development would also be more positive than expected if structural reforms to bolster productivity growth were implemented more rapidly and comprehensively than previously planned.

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For the euro area, KfW expects price-adjusted GDP to grow by 1.0% year on year in 2025. If this projection proves accurate, the level of total economic output will be 5.6 percentage points above pre-pandemic price-adjusted GDP in 2019; however the growth rate will remain below the average of 2014–2023 (see table “Gross domestic product at constant prices, year-on-year change”). A more pronounced eurozone recovery in terms of percentage year-on-year growth was hampered in particular by heightened uncertainty regarding the development of geopolitical and trade tensions. Given the forecasts for the global economy described above, the expected increase in protectionist policies by the United States in particular will limit export industry trade options.

Despite these factors, rising consumer demand from private households continues to be the main driver of economic growth according to the European Commission's projections made in November 2024. Further – albeit weaker – real growth in household income, declining inflation and a solid employment situation are expected to generate higher household consumption expenditure. The expansionary monetary policy is also fuelling growth. Improved financing conditions are likely to lift investment activity slightly. Reactivating the European Union (EU) fiscal rules will lead to a restrictive fiscal policy in the eurozone as a whole due to the need for consolidation in the member states. Numerous factors, including the high energy prices, will continue to burden the international competitiveness of the euro area manufacturing industry. KfW estimates that, among the four largest eurozone countries, Germany and Italy will record growth below the euro area average due to their relatively important industrial sectors and their export orientation, while France can be expected to record average growth and Spain above-average growth compared to the eurozone as a whole.

KfW expects price-adjusted GDP in Germany to increase by 0.5% year on year in 2025. Price-adjusted GDP in 2025 is therefore expected to be 0.8% higher than in 2019, the year before the outbreak of the COVID-19 pandemic (see table “Gross domestic product at constant prices, year-on-year change”). In view of the above forecasts for the global economy and assuming that private households' purchasing power will increase as a result of a decline in headline inflation and a simultaneous rise in nominal wages, KfW assumes that among GDP expenditure components not only household final consumption expenditure but also government final consumption expenditure will grow in 2025. Private gross capital formation will likely stagnate in 2025, while that of the public sector will likely increase. Regarding output, the service sector will make a greater contribution to price-adjusted gross value added in 2025 in line with KfW's. The average annual number of persons in employment located in Germany is expected to stagnate in 2025, with an increase in the skilled labour shortage expected due to demographics.

Gross domestic product at constant prices, year-on-year change

	2024	2025 forecast	2014–2023 average	2025 forecast
	in %	in %	in %	2019 index = 100
Euro area	0.7	1.0	1.5	105.6
Germany	-0.2	0.5	1.1	100.8
USA	2.8	2.1	2.4	114.8

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In addition to geopolitical and geoeconomic risks, domestic and global economic policy uncertainty – including about the possibility of unexpectedly high US import tariffs on goods from the EU or an escalation of the trade conflict between the US and China, shortages and sharp price increases on the energy and commodity markets, an economic slump in China resulting from the real estate crisis there, a surprisingly significant downturn in the labour market, and environmental and natural disasters – could lead to lower growth in German price-adjusted GDP than that forecast by KfW for 2025, or even to GDP contraction.

There would be opportunities for price-adjusted GDP to grow more than predicted by KfW for 2025, such as in the event of an unexpectedly rapid decrease in economic policy uncertainty including the waiver of higher US import tariffs on goods from the EU, an end to the Russian war of aggression in Ukraine with the resulting export opportunities for Germany for reconstruction, a marked decline in the recently stepped-up savings rate of German private households, and in the event of a surprising boost in productivity due to artificial intelligence. Should a new German government interpret the debt brake enshrined in the Basic Law differently, reform it or decide to suspend it for reason of an extraordinary emergency situation such as higher military spending, the fiscal stimulus could be more positive than previously assumed.

In June 2024, the European Central Bank ("ECB") initiated its monetary easing cycle, lowering the 4.00% deposit rate then in place by 25 basis points. This was followed by three more interest rate cuts by the end of the year. It also narrowed its key rate range. KfW assumes that the ECB will continue to gradually lower key rates due to inflationary pressure easing in a weak economy. Monetary easing is expected to be concluded in the course of 2025 with a deposit rate between 1.75% and 2.25%.

The ECB is continuing to shrink its balance sheet. Consequently the redemption amounts of maturing securities from the Asset Purchase Programme ("APP") have not been reinvested since July 2023. The ECB Governing Council also intends to completely cease reinvestment of redemptions in the Pandemic Emergency Purchase Programme ("PEPP") initiated during the COVID-19 pandemic. This will likely result in a balance sheet reduction of around EUR 500 billion or approximately 8% of total assets for 2025. The inversion of the euro yield curve (the spread between ten and two-year EUR swap rates) has ended due to initiation of the rate-cutting cycle. KfW expects the curve to stabilise in low positive territory in 2025.

The US Federal Reserve also began cutting key rates in the US in September 2024. KfW expects easing to continue into 2025, with the pace and scope also dependent on the direction fiscal policy will take under the new US government.

In the first half of 2025, the slope of the US dollar yield curve is likely to follow the eurozone into positive territory (the spread between ten and two-year USD swap rates). KfW expects the yield curve to remain almost flat throughout 2025.

New business projections

Overview

KfW Group projects new business volume of EUR 84.4 billion for 2025. This reflects the stabilisation of new commitment growth in uncertain times. It was not possible to prepare projections on the new business figures, promotional ratios or resources that took into account the political developments in November 2024 (upcoming vote of confidence/new elections in Germany, presidential election result in the USA). Nor do these projections take account of any special programmes or Federal Government-mandated transactions, because of the high level of uncertainty characterising their preparation. KfW will fulfil its mandate and support the German economy and society as needed.

KfW is careful to avoid potential adverse effects and risks to society and the environment in its promotional activities, and where possible attempts to reduce or offset such effects via suitable measures (inside-out perspective). Furthermore, KfW considers environmental changes, such as to the climate and biodiversity, social transformation and governance standards with an impact on the credit rating of KfW clients, as well as the effects of various climate scenarios on KfW's business model and risk profile (outside-in perspective). We do not expect these considerations to have any impact on the new commitment volume projected for 2025.

KfW Financial Report 2024

Financial Report > Combined Management Report > Forecast and opportunity report

Domestic business

New business development continues to return to normal, following the special programmes of the business sector Mittelstandsbank & Private Kunden (SME Bank & Private Clients) in the context of the war in Ukraine and the pandemic that shaped recent years. The development of the EU reference rate and the associated restrictions on promotional capacity in programmes not supported through state aid, the generally poor willingness to invest in the overall economic environment, and budget funds are impacting new business expectations for 2025. Decreases in corporate environmental financing can be temporarily offset by the new programmes: Climate-friendly New Construction – Low-Price Segment and Residential Property for Families – Acquisition of Existing Properties. Overall, new business volume of EUR 39.4 billion is anticipated for 2025. The projections include EUR 8.8 billion for ERP programmes. Around EUR 0.3 billion in ERP promotional expense is budgeted to support the positive sales impact of the ERP programmes. In addition, for example, to drawing up the terms, the risk-bearing capacity and passing on of favourable refinancing costs, promotional expense is yet another instrument to underpin the primary objective of promotion.

The business sector bundles the retail business capable of being digitalised and automated and carries a large share of the domestic promotional volume. The business sector positions itself as a reliable partner to the Federal Government and is divided into two segments by customer group: The SME Bank segment supports the German economy with a wide range of promotional programmes for commercial customers with various promotional priorities. The Private Clients segment supports education and energy efficiency in the construction and refurbishment of residential buildings, and also promotes the acquisition and construction of owner-occupied housing as well as accessible conversion/construction of homes. The necessary transformation towards renewable energy, the high level of investment required to achieve climate neutrality, the persistent uncertainty regarding the energy supply due to the ongoing war and the worsening consequences of climate change have a direct impact on relevant markets and customer groups in the business sector, while also constituting an opportunity. First, new promotional objectives and approaches to expand renewable energy are emerging, which, among other matters, serve the transformation of companies in order to achieve environmental and climate targets as well as further expanding renewable energy. Second, promotion of energy-efficient buildings plays a key role in achieving the construction sector's climate targets. What is more, the issue of climate resilience is increasingly coming to the fore as climate change intensifies.

The business sector Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) bundles innovative and tailored promotional solutions for companies and banks, and promotion of municipal and social infrastructure. Based on its expertise, the business sector is responsible for implementing large-volume Federal Government-mandated transactions in the energy context and focuses its core business on the targeted promotion of environmental protection and climate action, innovations and the acceleration of digitalisation.

This sector is split into three business segments: With regard to customised financing for companies, the moderate economic recovery may generate a slight increase in loan demand. However, even with a moderate economic recovery in Germany, potentially lower risk tolerance on the part of partner banks cannot be ruled out. This could result in greater demand for KfW's risk participation. In this context, particularly the risk-bearing promotional products in the megatrends "climate change and environment", "digitalisation and innovation" and "venture debt financing" are achieving greater relevance for young growth-oriented companies.

The demand for investment in municipal and social infrastructure remains strong given the central role municipalities play in meeting the challenges presented by climate change and the digital transformation. However, the strained budget situation of many municipalities in conjunction with limited planning capacities limits their investment and borrowing opportunities. Moreover, the problem of a high EU reference rate with an inverse interest rate structure considerably limits the attractiveness and utilisation of promotional programmes for municipal enterprises without the support of state aid. On the other hand, the heating transformation is expected to generate the chance of high demand for promotion and financing for geothermal energy/district heating and expansion of the electricity distribution grid.

KfW Financial Report 2024

Financial Report > Combined Management Report > Forecast and opportunity report

Individual financing with financing partners in Germany and Europe, as well as funding of promotional institutions of the federal states ("LIFs"), will continue to be characterised by a sound funding situation at partner banks. Demand for global loans to promote sustainable leasing investments, however, is currently noticeably limited by the EU reference rate. Present export loan refinancing demand for small and medium-sized projects is robust at present, yet potential for the German export industry has waned in the face of growing geoeconomic fragmentation and increasing competition from China.

The development of the EU reference rate curbed promotional opportunities in some promotional programmes in 2024. In this light, the business sector is projecting a slightly lower new business volume of EUR 7.8 billion for 2025 as well. The projections allow EUR 0.5 billion for ERP programmes at an ERP promotional expense of EUR 0.01 billion.

KfW Capital invests in venture capital ("VC") and venture debt funds to improve the sustainable provision of venture and growth capital, thereby also strengthening Germany as an innovation hub for the long term. Strengthening the German VC market is also necessary to tackle the persistent deficit in the amount of VC investment in future technologies compared to other industrialised nations. KfW Capital itself provides more venture capital directly to the market through its own fund investments. Particularly in the years when private investors were hesitant to raise funds, KfW Capital successfully positioned itself as a reliable partner and financier of VC funds and thus indirectly of technology companies in Germany.

ERP Venture Capital Fund Investments and ERP/Future Fund – Growth Facility will remain the two main own-risk programmes of KfW Capital in 2025 as well. The business sector also plans as part of its co-investment approach to make direct investments in companies in future, which will reduce the financing gap in the capital-intensive growth area. This also gives KfW Capital an opportunity for direct involvement in attractive companies with high growth potential and to give a decisive boost to key future areas. Moreover, from 2025, KfW Capital will increasingly invest in VC funds that aim to generate an environmental or social return in addition to a financial return via the new future fund component Impact Pocket.

KfW Capital is also continuing its activities as a financial portfolio manager under the Emerging Manager Facility ("EMF") and Growth Facility trust components, and as investment advisor in connection with the German Growth Fund. KfW Capital will then also act as a financial portfolio manager for KfW in the context of direct co-investments and Impact Pocket. In total, new business volume of around EUR 1.1 billion is expected for 2025, of which EUR 0.4 billion is at KfW Capital's own risk.

Financial markets

KfW Group bundles all funding activities along with its liquidity and operational market price risk management in the business sector Financial markets. Other tasks include carrying out holding arrangements on behalf of the Federal Government and mandated transactions in accordance with Article 2 (4) of the KfW Law as well as advising other group units on capital market matters and carrying out capital market transactions on behalf of other group units.

In order to reinforce KfW's sustainability profile and its positioning as a sustainable issuer, KfW consistently develops its green bond issuance strategy and further expanded the green bond programme again in 2024 by linking additional loan programmes. These measures are aimed at growing the investor base and ensuring a long-term stable and well-diversified capital market position.

International business

Economic and geopolitical risks, the uncertainty associated with the Russia-Ukraine war, the Middle East conflict, global economic fragmentation trends and the re-election of Donald Trump as US president are relevant for the business sector Export and project finance. There are opportunities in Europe and in the regions relevant for Export and project finance (including North and South America, the Middle East and Asia) in sectors with growth potential (e.g. digital infrastructure, e-mobility, local public transport, energy efficiency, and investments in sustainable transformation). Economic and sustainability programmes and programmes to bolster supply security may also stimulate demand for financing, particularly for infrastructure investments and transformation projects aiming for a climate-neutral economy. Although the future development of the business sector Export and project finance continues to entail many uncertainties, from today's perspective there are sufficient opportunities and potential for the targeted growth path.

KfW Financial Report 2024

Financial Report > Combined Management Report > Forecast and opportunity report

A new commitment volume totalling EUR 24.3 billion is expected for 2025. Of this amount, roughly EUR 22.1 billion is expected to be attributable to the primary business Export and project finance, and roughly EUR 2.2 billion to the commercial interest reference rate ("CIRR") business, which cannot be controlled by the business sector.

The business sector KfW Development Bank expects a moderately reduced commitment volume in the next few years, primarily due to budget consolidation. KfW Development Bank will continue to support projects of the German Federal Government and international institutions for development policy and international cooperation and help to safeguard German and European interests. Issues such as support for partner countries in the green energy transition, alleviating poverty and hunger, combating the effects of the war in Ukraine, achieving equal opportunities and mitigating crises and causes of displacement are high on the political agenda.

The federal budget funds provided for development cooperation will decrease in 2025. Although medium-term financial projections do not specify an extreme reduction, they are subject to considerable uncertainties. The future priorities of the German Federal Ministry for Economic Cooperation and Development ("BMZ"), as KfW Development Bank's most important contracting authority, are derived from long-term core areas based on the UN's Sustainable Development Goals ("SDGs") and the Paris Agreement, as well as initiative areas that inspire action in the medium term. In order to fulfil its ambitious development policy promotional objectives, the Federal Government must continue to provide an adequate guarantee framework for Financial Cooperation. There is potential for KfW Development Bank to play a part in international energy/climate/infrastructure partnerships. Climate mainstreaming is systematically incorporating climate risk analyses more and more into project design. Biodiversity conservation, which is closely linked to climate action, is also increasing political expectations and opportunities for the business sector to raise its profile. In both climate scenarios, greater climate risks and damage generate a growing demand from partner countries for financing to support the associated transformation processes and improve climate resilience.

Against the backdrop of planned projects of the German Federal Government and international institutions, KfW Development Bank currently expects a new business volume of around EUR 10 billion for 2025.

The subsidiary DEG is assigned to the DEG business sector of the same name. Economic growth in developing countries and emerging economies will continue to be characterised by overlapping crises and challenges in 2025. Further signs of a macroeconomic trend reversal are emerging as the peak of the polycrisis has passed, inflation continues to decline and central banks (particularly the US Federal Reserve and the ECB) have initiated an interest rate turnaround, reducing the pressure on local currencies and channelling capital flows into developing countries and emerging economies. However, persistent burdens such as the war in Ukraine, high debt ratios and elevated interest rates are still limiting monetary and fiscal room for manoeuvre. The aim continues to be to provide support to existing and new customers as a reliable partner to generate and secure contributions to local development (labour force, local income, and contributions to local communities). To this end, the business sector provides its customers with long-term financing in the form of loans (also in local currency), mezzanine financing and equity investments for their environmentally and socially responsible investments. DEG provides complementary advice to its customers, particularly on issues relating to sustainability, climate, development impact and corporate governance, in order to support them in their transformation and boost their contribution to local development. With its private sector focus, DEG has a special role to play in mobilising private capital. Private capital mobilisation is essential for achieving the SDGs and climate targets of the Paris Agreement.

DEG is forecasting new business in the amount of EUR 2.2 billion in 2025. As in recent years, this growth will be achieved in a way that conserves resources, including by realising efficiency gains, such as by granting larger financing commitments per customer with a suitable risk/return/impact profile and by using hedging instruments. The stronger alignment of new business with development and positive climate impacts is already embedded in corporate management and is being implemented in the three areas of Financial institutions, infrastructure and energy; Industries and services; and Private equity and venture capital. The focus here is on transformation work with DEG customers. In the coming years, DEG will also focus on its internal transformation, particularly digitalisation, and implement this in a targeted manner in order to sustainably reinforce its business.

KfW Financial Report 2024

Financial Report > Combined Management Report > Forecast and opportunity report

Funding projections

KfW issues bonds to fund its promotional activities worldwide. It issues these in a large number of currencies and with differing maturities, thereby addressing a variety of target groups. Due to the explicit direct guarantee of the Federal Government, rating agencies have assigned KfW bonds a triple A rating, signifying top credit quality. KfW has achieved a stable position in the capital markets with its diversified long term-oriented funding strategy. The funding volume via the capital markets was approximately EUR 78.1 billion in 2024. A funding need of EUR 65–70 billion is projected for 2025.

Earnings projections

In the group earnings projections for 2025, KfW expects Consolidated profit of approximately EUR 1,008 million. This puts projected earnings at the strategic target level of EUR 1 billion.

Net interest income (before promotional expense) of EUR 2.8 billion is expected for 2025. Higher income from lending business interest margins than was projected the previous year reflects the positive business performance in the business segment Export and project finance. Rising income is expected from strategic equity investments as a result of higher investment interest rates. Opportunities and risks for Consolidated profit may arise, primarily with respect to the structural contribution, from market conditions deviating from projections in conjunction with KfW's positioning.

KfW projects Net commission income totalling EUR 0.7 billion. This includes remuneration for the implementation of promotional programmes in Germany on behalf of the Federal Government as well as remuneration based on KfW Development Bank's General Agreement.

Administrative expense is likely to be approximately EUR 1.7 billion in 2025. This includes the launch of business policy projects in promotion, modernisation, digitalisation and regulation; compared to prior-year projections, costs are expected to rise due to non-recurring effects in the promotional business and the 2024 collective bargaining round.

Overall, the operating result before valuation is expected to be lower than was projected in the previous year.

At EUR 0.5 billion, KfW expects the standard risk costs for 2025 to be at the level of the risk provisions projected for 2024.

For 2025, Net income of EUR 0.2 billion and Net other operating income of EUR 0.1 billion are expected for operational level equity investments (included in Net gains/losses from other financial instruments at fair value and the Net gains/losses from investments accounted for using the equity method).

In this regard, the risk provisions for the lending business and the valuation result depend on the further development of the macroeconomic impact of the current geopolitical situation. The continued uncertain situation may lead to significant positive or negative deviations in the projected result, especially in earnings projections for international and equity investment business.

KfW expects promotional expense of EUR 0.5 billion in 2025.

Overall conclusion

In light of the economic environment and expected demand, KfW projects new business volume of EUR 84.4 billion and Consolidated profit of EUR 1.0 billion for 2025.

The further development of the economic and geopolitical situation, the uncertainty due to the Russia-Ukraine war, the conflict in the Middle East, the US election result and the upcoming new elections in Germany could have an impact on German and global economic performance, which in turn may affect the achievement of KfW's objectives set for financial year 2025. KfW will continue to closely monitor the development of the crises and uncertainty and the consequences thereof for KfW's business.

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

Overall activities of KfW

	2024	2023
Annual financial statements	EUR in millions	EUR in millions
Volume of business	705,121	722,920
Total assets	577,115	595,291
Bonds and notes issued	470,038	471,779
Own funds	32,849	31,977
Net interest income (before promotional expense)	2,093	2,151
Net commission income (before promotional expense)	525	425
Administrative expense (before promotional expense)	1,362	1,243
Promotional expense	503	375
Profit for the year	871	1,336

Development of KfW

KfW's earnings decreased year on year in financial year 2024. This was due to net additions to risk provisions in financial year 2024 compared to net reversals in the previous year. Moreover, the reversal of the fund for general banking risks in the amount of EUR 200 million in 2023, moreover, had contributed to the prior-year result as a non recurring effect.

KfW's total assets fell from EUR 18.2 billion to EUR 577.1 billion, with business volume consequently decreasing from EUR 722.9 billion to EUR 705.1 billion.

KfW promotional business volume decreased slightly compared with the previous year to EUR 92.6 billion (2023: EUR 93.3 billion). The difference to the KfW Group promotional business volume of EUR 112.8 billion relates to the international business and results from DEG and Export and project finance of KfW IPEX-Bank GmbH.

Development of earnings position

KfW's operating result before valuation and promotional expense was EUR 1,398 million, which was lower (by EUR 60 million) than the previous year's figure of EUR 1,457 million.

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

Reconciliation of internal earnings position (before promotional expense) with external earnings position (after promotional expense) for financial year 2024

Earnings position	Reconciliation			German Commercial Code income statement form
	EUR in millions	EUR in millions	EUR in millions
Net interest income (before promotional expense)	2,093	-406	1,688	Total of interest income and current income less interest expense
Net commission income (before promotional expense)	525	-12	514	Commission income less Commission expense
Administrative expense (before promotional expense)	1,362	14	1,376	Total general administrative expense and depreciation, amortisation and impairments on property, plant and equipment and intangible assets
Other operating income and expenses (before promotional expense)	141	-71	69	Other operating income less Other operating expense
Operating result (before risk provisions/valuation/promotional expense)	1,398	-503	895	Subtotal of Interest income, Current income, Commission income, Net other operating income less Interest expense, Commission expense, General administrative expense, Depreciation, amortisation and impairments on property, plant and equipment and intangible assets, Other operating expense
Valuation result	1	0	1	Income from reversals of write-downs of equity investments, shares in affiliated companies and securities held as fixed assets
Risk provisions for lending business	-32	0	-32	Impairment of receivables and certain securities and additions to provisions for loan losses
Net result from transfer agreements	9	0	9	Income from profit pooling, profit and loss transfer and partial profit transfer agreements
Profit/loss from operating activities (before promotional expense)	1,376	-503	873	Profit/loss from operating activities
Promotional expense	503	-503	0	-
Taxes on income	0	0	0	Taxes on income
Other taxes	1	0	1	Other taxes
Profit for the year	871	0	871	Profit for the year

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

Reconciliation of internal earnings position (before promotional expense) with external earnings position (after promotional expense) for financial year 2023

Earnings position	Reconciliation			German Commercial Code income statement form
	EUR in millions	EUR in millions	EUR in millions
Net interest income (before promotional expense)	2,151	-282	1,868	Total of interest income and current income less interest expense
Net commission income (before promotional expense)	425	-13	412	Commission income less Commission expense
Administrative expense (before promotional expense)	1,243	14	1,257	Total general administrative expense and depreciation, amortisation and impairments on property, plant and equipment and intangible assets
Other operating income and expenses (before promotional expense)	124	-66	58	Other operating income less Other operating expense
Operating result (before risk provisions/valuation/promotional expense)	1,457	-375	1,082	Subtotal of Interest income, Current income, Commission income, Net other operating income less Interest expense, Commission expense, General administrative expense, Depreciation, amortisation and impairments on property, plant and equipment and intangible assets, Other operating expense
Valuation result	13	-1	12	Income from reversals of write-downs of equity investments, shares in affiliated companies and securities held as fixed assets
Risk provisions for lending business	36	1	37	Income from the reversal of impairment losses on receivables and certain securities and the reversal of provisions for loan losses
Net result from transfer agreements	6	0	6	Income from profit pooling, profit and loss transfer and partial profit transfer agreements
Reversal of the fund for general banking risks	200	0	200	Reversal of the fund for general banking risks
Profit/loss from operating activities (before promotional expense)	1,712	-375	1,337	Profit/loss from operating activities
Promotional expense	375	-375	0	-
Taxes on income	0	0	0	Taxes on income
Other taxes	1	0	1	Other taxes
Profit for the year	1,336	0	1,336	Profit for the year

At EUR 2,093 million, Net interest income (before promotional expense) was down on the previous year (EUR 2,151 million) by EUR 57 million. The decrease was mainly due to the increase in interest expense for long-term borrowing.

Net commission income (before promotional expense) of EUR 525 million was EUR 101 million above the previous year's level of EUR 425 million. This growth was due to an increase in commission income in the federal programmes. The Energy-efficient Construction and Refurbishment programmes, their successor programme Federal Funding for Efficient Buildings and programmes offering promotion in line with the Buildings Energy Act (Gebäudeenergiegesetz – "GEG") increased from EUR 110 million to EUR 197 million. Commission income generated by the administration of German Financial Cooperation ("FC") in the business sector KfW Development Bank increased to EUR 255 million (2023: EUR 245 million). The remuneration from the Federal Government was offset by corresponding administrative expenses.

Administrative expense (before promotional expense) increased by EUR 119 million from EUR 1,243 million to EUR 1,362 million. The increase was primarily due to higher personnel expense resulting from both a greater number of employees and an increase in remuneration under the collective bargaining agreement. In addition, non-personnel expense (before promotional expense) rose from EUR 546 million to EUR 575 million, primarily as a result of higher costs for the use of external service providers. The increase in these costs was driven by both price and volume effects.

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

The result from Other operating income and expense (before promotional expense) amounted to EUR 141 million and was mainly due to the fee of EUR 103 million (2023: EUR 99 million) paid under the agency agreement with KfW IPEX-Bank GmbH.

The positive valuation result of EUR 1 million (2023: EUR 13 million income) was the result of income of EUR 2 million (2023: EUR 7 million) from the valuation of fund investments, partly offset by expense of EUR 1 million (2023: EUR 6 million) from securities.

Risk provisions for lending business generated net expense of EUR 32 million (2023: EUR 36 million net income). The net additions to specific valuation allowances were only partly offset by the net reversal of general valuation allowances and income from the successful recovery of loans previously written off. The net additions to specific valuation allowances resulted primarily from the business sectors Mittelstandsbank (SME Bank) and Export and project finance. Specific valuation allowances and specific provisions for the lending business rose from EUR 858 million to EUR 916 million. These also included specific valuation allowances for interest receivables at risk of default amounting to EUR 417 million. There was a decrease in general valuation allowances and general provisions for the lending business rose from EUR 333 million to EUR 305 million. Non-performing loans in the amount of EUR 64 million in connection with specific valuation allowances were written off in financial year 2024 (2023: EUR 80 million).

At EUR 503 million, KfW's domestic promotional expense, which has a negative impact on its earnings position, was above the prior-year level (2023: EUR 375 million). The key component of KfW's promotional expense in 2024 was the effect, in an aggregate amount of EUR 406 million (2023: EUR 282 million), of interest rate reductions granted during the first fixed interest rate period as well as passing on favourable funding conditions. Moreover, promotional expenses reported in net commission income and administrative expense amounted to EUR 26 million (2023: EUR 27 million). Among other things, this spending was aimed at the sale of KfW's promotional products. In financial year 2024, KfW once again entered into a commitment to provide promotional grants in KfW's ERP promotional programmes in subsequent years. This resulted in promotional expense of EUR 71 million in 2024 (2023: EUR 66 million).

The net result from transfer agreements includes KfW Capital GmbH's profit transfer in the amount of EUR 9 million.

Financial year 2024 closed with a profit for the period of EUR 871 million (2023: EUR 1,336 million), which was fully allocated to retained earnings in accordance with Article 10 (3) KfW Law.

Development of net assets

As of 31 December 2024, KfW recorded both a decrease in total assets of EUR 18.2 billion and a decrease in business volume of EUR 17.8 billion.

Volume of receivables

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Loans and advances to banks	381,096	400,867
Loans and advances to customers	113,601	120,400
Loans held in trust	10,821	10,886
Contingent liabilities from financial guarantees	799	615
Irrevocable loan commitments	127,207	127,014
Total	633,524	659,782

The volume of receivables (loans and advances to banks and customers, including irrevocable loan commitments, loans held in trust and guarantees) decreased from EUR 659.8 billion to EUR 633.5 billion. Loans and advances to banks due on demand fell by EUR 20.6 billion from EUR 48.2 billion to EUR 27.6 billion due to lower overnight deposits. The reason for this decrease was a deliberate reduction in liquidity totalling

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

EUR 11 billion and a movement of EUR 6.5 billion from ECB liquidity to other money market products. In addition, there was a change in recognition of cash collateral both from central counterparties (EUREX) and from OTC transactions during the reporting year. Cash collateral issued in the amount of EUR 2.2 billion was reclassified from Loans and advances to banks to Other assets. The change in loans and advances to customers from the previous year was primarily due to a decrease in loans in connection with the energy supply to EUR 4.9 billion (2023: EUR 8.8 billion).

The volume of loans held in trust decreased slightly from EUR 10.9 billion to EUR 10.8 billion. These loans consist primarily of loans to promote developing countries financed by budget funds provided by the Federal Republic of Germany.

Contingent liabilities from financial guarantees and Irrevocable loan commitments each increased by EUR 0.2 billion to EUR 0.8 billion and EUR 127.2 billion, respectively.

Total bonds and other fixed-income securities rose by EUR 1.2 billion to EUR 42.8 billion (2023: EUR 41.6 billion). Holdings of repurchased own issues amounted to EUR 4.0 billion (2023: EUR 3.8 billion). This was equivalent to 1.0% of bonds issued.

At a total amount of EUR 38.8 billion, holdings of securities of other issuers, which make up 90.7% of the total holdings of all bonds and other fixed-income securities, exceeded by EUR 1.1 billion the previous year's level of EUR 37.7 billion. Of the securities from other issuers, 78.2% are eligible as collateral for funding operations with the European Central Bank ("ECB").

Fund investments were recognised at EUR 0.8 billion and were reclassified from Equity investments to Shares and other non-fixed-income securities in the reporting year 2024.

The value of shares in affiliated companies amounted to EUR 4.4 billion (2023: EUR 4.2 billion). KfW's assets held in trust rose by EUR 1.5 billion to EUR 22.0 billion (2023: EUR 20.5 billion).

Development of financial position

KfW raised EUR 78.1 billion in the capital markets to fund its business activities in 2024 (2023: EUR 90.2 billion). A total of 145 transactions were executed (2023: 186) and bonds were issued in eight currencies. Nine Green Bond transactions (including top-ups) with a volume of EUR 12.2 billion and in seven currencies contributed approximately 16% to total funding.

Borrowings decreased by EUR 27.6 billion from EUR 534.0 billion to EUR 506.4 billion.

Borrowings

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Federal Republic of Germany
- ERP Special Fund	342	315
- Federal budget	4,270	7,944
- Economic Stabilisation Fund (WSF)	21,446	35,964
	26,058	44,223
Other lenders	5,072	5,035
Liabilities to customers	31,130	49,258
Liabilities to banks	5,248	12,948
Long-term debt securities	434,121	431,613
Commercial papers	32,488	37,674
Accrued interest and interest payable	3,428	2,492
Bonds and notes issued	470,038	471,779
Total	506,416	533,985

KfW Financial Report 2024

Financial Report > Combined Management Report >

Notes to the KfW annual financial statements prepared in accordance with the German Commercial Code

Bonds issued decreased by EUR 1.7 billion year on year and totalled EUR 470.0 billion as of 31 December 2024. New issuances and maturities as well as fluctuations in foreign exchange rates, particularly of the US dollar, had an impact on portfolio development.

Bonds issued accounted for 92.8% of borrowed funds, which was higher than the previous year's level (88.4%). Proportionally, bonds therefore remain KfW's largest source of funding. The share of total funding volume in 2024 represented by bonds denominated in euros was 62% (2023: 54%). The share of bonds denominated in US dollars amounted to 25% (2023: 29%). The share of bonds denominated in pounds sterling remained unchanged from the previous year at 9%.

As of 31 December 2024, KfW's funds raised via the Economic Stabilisation Fund ("WSF") by means of promissory note loans decreased by EUR 14.5 billion to EUR 21.4 billion. WSF funding of EUR 17.4 billion was used to fund the special coronavirus programme and EUR 4.0 billion to finance programmes to ensure the liquidity of energy sector companies and the necessary infrastructure.

The share of funds from banks and customers (excluding federal budget funds) slightly decreased year-on-year to 2.0% (2023: 3.4%).

A change in presentation was made for cash collateral from central counterparties (EUREX) and from OTC transactions. Cash collateral received is now recognised under Other liabilities instead of Liabilities to banks. Cash collateral received for the reporting year totalled EUR 7.8 billion.

KfW's own funds amounted to EUR 32.8 billion as of 31 December 2024, up 2.7% compared to the previous year. This increase was exclusively due to the net profit of EUR 871 million allocated to retained earnings.

Own funds

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Subscribed capital	3,750	3,750
Uncalled contributions outstanding	-450	-450
Capital reserve	8,447	8,447
Reserve from the ERP Special Fund	1,191	1,191
Retained earnings
a) Statutory reserve under Article 10 (2) KfW Law	1,875	1,875
b) Special reserve under Article 10 (3) KfW Law	17,988	17,117
c) Statutory reserve under Section 17 (4) D-Mark Balance Sheet Act^{1)}	48	48
Total	32,849	31,977

1) To be adjusted by the special loss account presented on the assets side in accordance with Section 17 (4) of the D-Mark Balance Sheet Act (EUR 26 million)

KfW Financial Report 2024

Financial Report > Combined Management Report > Declaration of compliance / Non-financial statements of KfW Group

Declaration of compliance

The Executive Board and Board of Supervisory Directors of KfW have resolved to recognise the principles of the Federal Public Corporate Governance Code (Public Corporate Governance Kodex des Bundes – "PCGK") and apply them at KfW. The Corporate Governance Report of KfW contains the declaration of compliance with the recommendations of the PCGK.

Non-financial statements of KfW Group

Information on the "Combined non-financial report of KfW as the parent company and of KfW Group" is included in a separate chapter which forms part of the financial report. It can be accessed in the chapter "Combined non-financial report".

The following chapters of the "Combined management report" supplement the "Combined non-financial report of KfW as the parent company and of KfW Group in accordance with Sections 315b and 289b HGB and Section 315c in conjunction with Sections 289c to 289e HGB" as follows:

In addition to the typical management report content, the "Basic information on KfW Group" chapter also includes information on the disclosure requirements ESRS 2 SBM-1, ESRS 2 SBM-3, ESRS 2 GOV-2, ESRS 2 IRO-1, E1 IRO-1, E1-4, E2-3, E4-4 in conjunction with ESRS 2 MDR-T and S1-1 of the ESRS.
In addition to the typical management report content, the "Economic report" chapter also includes information on the disclosure requirements ESRS 2 SBM-1 of the ESRS.
In addition to the typical management report content, the "Risk report" chapter also includes information on the disclosure requirements ESRS 2 GOV-2, ESRS 2 GOV-5, ESRS 2 IRO-1, E1-2 in conjunction with ESRS 2 MDR-P, E1-3 in conjunction with ESRS 2 MDR-A, E1-4, E4-1 and G1-1 of the ESRS.
In addition to the typical management report content, the "Forecast and opportunity report" chapter also includes information on the disclosure requirements ESRS 2 SBM-1, ESRS 2 SBM-3 and E1 IRO-1 of the ESRS.

KfW Financial Report 2024

Consolidated financial statements

Financial Report > Consolidated financial statements

Consolidated statement of comprehensive income 256
Consolidated statement of financial position 257
Consolidated statement of changes in equity 258
Consolidated statement of cash flows 259
Consolidated notes 261

Accounting policies 262
(1) Basis of presentation of KfW Group 262
(2) Accounting standards that are new, amended or to be adopted for the first time 263
(3) Changes to material accounting policies 265
(4) Judgements and accounting estimates 265
(5) Group of consolidated companies 266
(6) Basis of consolidation 266
(7) Financial instruments 267
(8) Derivatives and hedging relationships 276
(9) Offsetting of financial instruments 278
(10) Foreign currency translation 279
(11) Revenue from contracts with customers 279
(12) Promotional lending business at KfW 280
(13) Non-current assets held for sale 280
(14) Repurchase agreements and securities lending 280
(15) Property, plant and equipment 281
(16) Leases 281
(17) Intangible assets 282
(18) Risk provisions 282
(19) Income tax assets and liabilities 283
(20) Equity 284
(21) Trust activities 284

Notes to the consolidated statement of comprehensive income 285
(22) Net interest income 285
(23) Net gains/losses from risk provisions 287
(24) Net commission income 287
(25) Net gains/losses from hedge accounting 289
(26) Net gains/losses from other financial instruments at fair value through profit or loss 291
(27) Net gains/losses from disposal of financial assets at amortised cost 292
(28) Net gains/losses from investments accounted for using the equity method 292
(29) Administrative expense 292
(30) Net other operating income or loss 293
(31) Taxes on income 293

Segment reporting 295
(32) Segment reporting by business sector 295
(33) Segment reporting by region 299

KfW Financial Report 2024

Financial Report > Consolidated financial statements

Notes to the consolidated statement of financial position

300
- (34) Cash reserves 300
- (35) Financial assets at amortised cost 300
- (36) Gross carrying amounts 302
- (37) Risk provisions 304
- (38) Financial assets at fair value 306
- (39) Value adjustments from macro fair value hedge accounting 306
- (40) Derivatives designated for hedge accounting 306
- (41) Investments accounted for using the equity method 307
- (42) Non-current assets held for sale 307
- (43) Property, plant and equipment 308
- (44) Intangible assets 309
- (45) Income tax assets 310
- (46) Other assets 311
- (47) Financial liabilities at amortised cost 311
- (48) Financial liabilities at fair value 312
- (49) Value adjustments from macro fair value hedge accounting 313
- (50) Derivatives designated for hedge accounting 313
- (51) Risk provisions 313
- (52) Income tax liabilities 316
- (53) Other liabilities 317
- (54) Equity 318

Notes to financial instruments

319
- (55) Gains and losses from financial instruments by measurement category 319
- (56) Disclosures on fair value 321
- (57) Entwicklung der zum Fair Value bilanzierten 331
- (58) Disclosures on macro fair value hedge accounting 335
- (59) Additional disclosures on derivatives 338
- (60) Additional disclosures on financial liabilities at fair value 339
- (61) Contractual payment obligations arising from financial instruments 340
- (62) Disclosures on repurchase agreements 341
- (63) Disclosure on offsetting financial instruments 342

Other notes

344
- (64) Off-balance sheet transactions 344
- (65) Trust activities and administered loans 344
- (66) Leasing transactions as lessee 345
- (67) Average number of employees during the financial year 345
- (68) Remuneration report 346
- (69) Related party disclosures 352
- (70) Auditor's fees 355
- (71) Disclosures on unconsolidated structured entities 355
- (72) Disclosures on shareholdings 357
- (73) Events after the balance sheet date 360

Attestations

362

Responsibility statement

363

Independent auditor's report

364

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated statement of comprehensive income

Consolidated statement of comprehensive income

Consolidated income statement

	Notes	2024	2023
		EUR in millions	EUR in millions
Interest income from the effective interest method		20,132	17,300
Other interest income		1,049	1,099
Interest income, total	(22)	21,181	18,399
Interest expense	(22)	18,689	15,943
Net interest income^{1)}		2,493	2,456
Net gains/losses from risk provisions	(7), (23)	39	169
Net interest income after risk provisions		2,531	2,625
Commission income	(11), (24)	693	622
Commission expense	(24)	30	29
Net commission income		664	593
Net gains/losses from hedge accounting	(8), (25), (57), (58)	107	291
Net gains/losses from other financial instruments at fair value through profit or loss	(26)	44	-177
Net gains/losses from disposal of financial assets at amortised cost	(27)	0	0
Net gains/losses from investments accounted for using the equity method	(6), (28)	20	29
Administrative expense	(29)	1,672	1,561
Net other operating income or loss	(30)	-52	-76
Profit/loss from operating activities		1,641	1,724
Taxes on income	(19), (31)	239	165
Consolidated profit		1,402	1,559

1) Refer to Note 22 for a gross presentation of Interest income and Interest expense related to reporting of negative interest income and positive interest expense.

Consolidated statement of comprehensive income

	2024	2023
	EUR in millions	EUR in millions
Consolidated profit	1,402	1,559
Other comprehensive income	98	-65
Change in own credit risk of liabilities designated at fair value through profit or loss	105	49
Defined benefit pension obligations (before taxes)	-6	-121
Deferred taxes on defined benefit pension obligations	-1	7
Consolidated comprehensive income	1,500	1,494

Other comprehensive income comprises amounts recognised directly in equity under Revaluation reserves. These amounts include income and expense from the change in own credit risk of liabilities designated at fair value through profit or loss, changes in actuarial gains and losses for defined benefit pension obligations, and changes in deferred taxes reported depending on the underlying transaction.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated statement of financial position

Consolidated statement of financial position

Assets

| | Notes | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- | --- |
| Cash reserves | (34) | 26,522 | 47,431 |
| Financial assets at amortised cost | (7), (12), (35), (36), (37), (57), (58) | 502,666 | 503,175 |
| Financial assets at fair value | (7), (38), (59) | 15,716 | 16,799 |
| Value adjustments from macro fair value hedge accounting | (8), (39), (59) | -9,375 | -14,771 |
| Derivatives designated for hedge accounting | (8), (40), (57), (58), (59) | 7,445 | 5,443 |
| Investments accounted for using the equity method | (41), (6) | 500 | 626 |
| Non-current assets held for sale | (13), (42) | 37 | 78 |
| Property, plant and equipment | (15), (43) | 922 | 929 |
| Intangible assets | (17), (44) | 69 | 82 |
| Income tax assets | (19), (45) | 109 | 176 |
| Other assets | (11), (46) | 754 | 772 |
| Total | | 545,366 | 560,741 |

Liabilities and equity

| | Notes | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- | --- |
| Financial liabilities at amortised cost | (7), (47), (57), (58) | 485,502 | 499,700 |
| Financial liabilities at fair value | (7), (48), (59), (60) | 9,774 | 10,365 |
| Value adjustments from macro fair value hedge accounting | (8), (49), (59) | -16 | -1 |
| Derivatives designated for hedge accounting | (8), (50), (57), (58), (59) | 6,982 | 9,300 |
| Provisions | (7), (18), (51) | 2,948 | 2,811 |
| Income tax liabilities | (19), (52) | 230 | 107 |
| Other liabilities | (11), (53) | 374 | 386 |
| Equity | (20), (54) | 39,573 | 38,073 |
| Paid-in subscribed capital | | 3,300 | 3,300 |
| Capital reserve | | 8,447 | 8,447 |
| Reserve from the ERP Special Fund | | 1,191 | 1,191 |
| Retained earnings | | 26,552 | 25,150 |
| Revaluation reserves | (7), (20), (54) | 83 | -15 |
| Total | | 545,366 | 560,741 |

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated statement of changes in equity

Consolidated statement of changes in equity

	Subscribed capital	Capital reserve	Reserve from the ERP Special Fund	Retained earnings	Fund for general banking risks	Revaluation reserves	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2023	3,300	8,447	1,191	23,391	200	50	36,579
Consolidated comprehensive income	0	0	0	1,559	0	-65	1,494
Consolidated profit	0	0	0	1,559	0	0	1,559
Other comprehensive income	0	0	0	0	0	-65	-65
Reclassifications within Equity	0	0	0	200	-200	0	0
As of 31 Dec. 2023	3,300	8,447	1,191	25,150	0	-15	38,073
Consolidated comprehensive income	0	0	0	1,402	0	98	1,500
Consolidated profit	0	0	0	1,402	0	0	1,402
Other comprehensive income	0	0	0	0	0	98	98
Reclassifications within Equity	0	0	0	0	0	0	0
As of 31 Dec. 2024	3,300	8,447	1,191	26,552	0	83	39,573

The difference to the consolidated comprehensive income is allocated to Other retained earnings or – if recognised directly in equity – to revaluation reserves.

Note 54 provides details on the consolidated statement of changes in equity.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated statement of cash flows

Consolidated statement of cash flows

| | 2024
EUR in millions | 2023
EUR in millions |
| --- | --- | --- |
| Consolidated profit | 1,402 | 1,559 |
| Non-cash items included in consolidated profit and reconciliation to cash flow from operating activities: | | |
| Depreciation, amortisation, impairment and reversal of impairment losses (assets) and changes in risk provisions for lending business | 143 | 50 |
| Changes in provisions for pensions and similar commitments and Other provisions | 264 | 235 |
| Other non-cash expenses and income | 72 | 47 |
| Profit/loss from the disposal of assets | 0 | 0 |
| Other adjustments | -2,325 | -2,339 |
| Subtotal | -444 | -446 |
| Changes in assets and liabilities from operating activities after adjustment for non-cash items: | | |
| Financial assets at amortised cost | 444 | -2,893 |
| Financial assets at fair value | 1,061 | -326 |
| Other assets relating to operating activities | -7,251 | -7,302 |
| Financial liabilities at amortised cost | -14,198 | 7,121 |
| Financial liabilities at fair value | -66 | -18 |
| Other liabilities relating to operating activities | -2,836 | -2,825 |
| Interest and dividends received | 21,181 | 18,399 |
| Interest paid | -18,689 | -15,943 |
| Income tax paid | -167 | -117 |
| Cash flow from operating activities | -20,965 | -4,350 |
| Property, plant and equipment/Intangible assets: | | |
| Cash proceeds from disposals | 17 | 2 |
| Cash payments for acquisitions | -90 | -77 |
| Securities and investments (equity investments): | | |
| Cash proceeds from disposals/Cash payments for acquisitions | 129 | 7 |
| Cash flow from investing activities | 56 | -68 |
| Cash proceeds from/Cash payments for capital increases/decreases | 0 | 0 |
| Changes from other financing activities | 0 | 0 |
| Cash flow from financing activities | 0 | 0 |
| Cash and cash equivalents as of the end of the previous period | 47,431 | 51,848 |
| Cash flow from operating activities | -20,965 | -4,350 |
| Cash flow from investing activities | 56 | -68 |
| Cash flow from financing activities | 0 | 0 |
| Cash and cash equivalents as of the end of the period | 26,522 | 47,431 |

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated statement of cash flows

The balance of Cash and cash equivalents reported in the statement of cash flows in accordance with IAS 7 is identical to the statement of financial position item Cash reserves and thus comprises cash on hand and balances with central banks.

The statement of cash flows shows the changes in Cash and cash equivalents in the financial year classified as the Cash flows from operating activities, investing activities and financing activities. The Other adjustments item largely comprises the adjustment for net interest income in the amount of EUR -2,493 million (2023: EUR -2,456 million). The cash payments for the repayment portion of lease liabilities included in Cash flow from operating activities amounted to EUR 13 million in financial year 2024 (2023: EUR 13 million). The cash payments for the interest portion of lease liabilities are reported under Interest paid.

For more information on the group's liquidity risk management, see the section on liquidity risk in the combined management report.

KfW Financial Report 2024

Consolidated notes

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

Accounting policies

(1) Basis of presentation of KfW Group

As the group parent company, KfW is the promotional bank of the Federal Republic of Germany and was founded in 1948 as a public law institution based in Frankfurt am Main (Palmengartenstrasse 5-9, 60325 Frankfurt am Main, Germany). KfW promotes sustainable improvement of economic, environmental and social conditions around the world, but with an emphasis on the German economy.

The Executive Board of KfW is responsible for preparing the consolidated financial statements and the combined management report. The Executive Board will approve the publication of the consolidated financial statements on 11 March 2025.

As of the reporting date, KfW Group comprises KfW and six fully consolidated subsidiaries. One joint venture and two associated companies are accounted for using the equity method. Changes in the group of consolidated companies can be found in Note 5 "Group of consolidated companies".

Pursuant to Section 315e (1) of the German Commercial Code (Handelsgesetzbuch – "HGB"), the consolidated financial statements as of 31 December 2024 have been prepared in accordance with the International Financial Reporting Standards ("IFRS"), as adopted by the European Union ("EU"), and with the interpretations set out by the IFRS Interpretations Committee ("IFRS IC"), as mandatory consolidated accounts in accordance with Article 4 of Regulation (EC) No. 1606/2002 ("IAS Regulation") of the European Parliament and of the Council of 19 July 2002, as well as further regulations on the adoption of certain international accounting standards. The standards and interpretations that apply are those that have been published and endorsed by the European Union as of the reporting date.

The supplementary provisions of the German Commercial Code that also apply to IFRS consolidated financial statements have been taken into account. The combined management report prepared in accordance with Section 315 of the German Commercial Code includes the risk report with risk-oriented information on financial instruments as set out in IFRS 7, as well as information on capital and capital management as set out in IAS 1.134.

The consolidated financial statements were prepared in accordance with accounting policies that are consistent across KfW Group and are prepared on a going-concern basis. The companies included in the consolidated financial statements have prepared their annual financial statements as of 31 December 2024, except for some associated companies accounted for using the equity method, where financial statements as of 30 September 2024 were used. Material events for the latter companies as of the reporting date were also taken into account.

The accounting policies in the consolidated financial statements were applied consistently with the exception of the items listed in Note 3.

The reporting currency is the euro. Unless otherwise specified, all amounts are stated in millions of euros (EUR in millions).

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

(2) Accounting standards that are new, amended or to be adopted for the first time

A. Impact of new or amended IFRS/IFRIC interpretations adopted for the first time in financial year 2024

The amendments to IAS 1 from January 2020 serve to clarify the criteria for classifying liabilities as current or non-current. Accordingly, the classification of liabilities as current or non-current will be based on the rights held by the entity on the reporting date. A liability is classified as non-current if, at the end of the reporting period, the entity has a substantial right to defer settlement of the liability for at least 12 months after the reporting date. Further guidance on the interpretation of specific criteria and explanatory notes has also been included.

The amendment to IAS 1 published in October 2022 clarifies when debt is to be classified as current or non-current, taking into account agreed covenants. It stipulates that only covenants that must be complied with on or before the reporting date affect the classification as current or non-current liabilities. For liabilities classified as non-current with covenants which are due within 12 months after the reporting date, additional disclosures must be made in the notes to enable users of the financial statements to assess the risk of a possible early repayment of the liability. The amendments to IAS 1 on liabilities with settlement deferral options or liability extinguishment rights in connection with covenants do not have any material impact on KfW's consolidated financial statements.

The September 2022 amendment to IFRS 16 introduces rules on subsequent measurement for seller-lessees in the case of leases in a sale and leaseback transaction. It stipulates that in the subsequent measurement, the lease liability is to be measured in a way that does not recognise any gain or loss that relates to the right of use it retains.

The amendments to IAS 7 and IFRS 7 published in May 2023 are intended to enhance the transparency of supplier finance arrangements. Qualitative and quantitative information on arrangements with suppliers should be made available in order to understand their effects on the financial liabilities, cash flows and liquidity risk of the reporting entity.

The accounting standards that are new, amended or to be adopted for the first time have no significant impact on the net assets, financial and earnings position of KfW Group.

B. Impact of new or amended IFRS/IFRIC interpretations to be adopted in the future that were endorsed by the EU into European law before the reporting date

Standard concerned	Mandatory application for financial years from	Description
IAS 21	1 Jan. 2025	The amendments to IAS 21 published in August 2023 require an entity to apply a consistent approach when assessing whether a currency is exchangeable into another currency. This determines how an entity determines the exchange rate to be applied when a currency is not exchangeable. Additional information must be disclosed in cases of non-exchangeability.

KfW Group does not utilise the permitted early application options of the standard amendments. The future amendments to the standards described above are not expected to have any significant impact on the group's net assets, financial and earnings position.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

C. New or amended IFRS/IFRIC interpretations to be applied in the future that were published by the EU before the reporting date but have not yet been endorsed into European law

Standard concerned	Effective for financial years from	Description
IFRS 9 / IFRS 7	1 Jan. 2026	The amendments to IFRS 7 and IFRS 9 published in May 2024 relate, among other things, to the requirements in IFRS 9 on the derecognition of financial liabilities using electronic payment systems and on the classification of financial assets, particularly taking into account conditional interest payments (linking interest to ESG factors). In addition, disclosure requirements have been added for financial instruments with conditional cash flows (e.g. those tied to ESG factors) and for investments in equity instruments recognised at fair value directly in equity. In mid-December 2024, the IASB published amendments to IFRS 9 and IFRS 7 on nature-dependent electricity contracts. Accordingly, the own-use exception in accordance with IFRS 9.2.4 et seq. is to be applied to long-term physical power purchase agreements if the company has been a net purchaser of renewable electricity under the contract to date and is expected to be a net purchaser for the entire remaining term of the contract. Furthermore, adjustments to the requirements for hedge accounting in IFRS 9 are planned with the possibility of using contracts for electricity from renewable energy sources as a hedging instrument under certain conditions. The hedge accounting requirements in accordance with IAS 39 remain unaffected. Moreover, additional disclosure requirements are to be effected in order to better understand the effects of nature-dependent electricity on the financial performance and future cash flows of an entity.
AIP – Volume 11	1 Jan. 2026	At the end of July 2024, the IASB published the “Annual Improvements to IFRS Accounting Standards – Volume 11” with clarifications and corrections: IFRS 1: Hedge accounting by a first-time adopter. In IFRS 1 paragraphs B5 and B6, cross-references to IFRS 9 6.4.1 have been added, and the term “conditions” has been replaced by “qualifying criteria”. IFRS 7: Gain or loss on derecognition. Disclosure of deferred difference between fair value and transaction price, credit risk disclosures. In particular, changes have been made to referencing and wording to eliminate ambiguities and inconsistencies. IFRS 9: Lessee derecognition of lease liabilities; transaction price. IFRS 9 2.1 (b)(ii) is supplemented by a cross-reference to the IFRS 9 rules on accounting for profit or loss on disposal. The reference to the definition of transaction price in accordance with IFRS 15 in IFRS 9 5.1.3 and in Appendix A has been removed, as the term “transaction price” is used in certain sections of IFRS 9 in a context that does not necessarily correspond to the definition of this term in IFRS 15. IFRS 10: Determination of a ‘de facto agent’. The amendment resolves a confusion between IFRS 10 paragraphs B73 and B74 by aligning the language in the two paragraphs. IAS 7: Cost method. In IAS 7 paragraph 37 the term “cost method”, has been replaced by “at cost”.
IFRS 18	1 Jan. 2027	The new standard IFRS 18 ‘Presentation and Disclosure in Financial Statements’ will replace the previous IAS 1 ‘Presentation of Financial Statements’ and is aimed at more transparent presentation and comparability of the performance of entities with a focus on a restructured income statement. Income and expenses are divided into five categories (operating, investing, financing, income taxes, and discontinued operations) with the income statement broken down by predefined subtotals. IFRS 18 also contains provisions to improve the summary and breakdown of items, as well as disclosure requirements for alternative key figures defined by management that are not specified in the IFRS accounting standards.
IFRS 19	1 Jan. 2027	The new standard IFRS 19 ‘Subsidiaries without Public Accountability: Disclosures’ permits certain subsidiaries to apply IFRS accounting standards with reduced disclosure. An entity may elect to apply IFRS 19 if it is a subsidiary (within the meaning of IFRS 10), does not have public accountability (is not a financial institution and not capital market-oriented) and has an ultimate or intermediate parent that produces consolidated financial statements available for public use that comply with IFRS accounting standards.

KfW Financial Report 2024

KfW does not intend to utilise the permitted early application options of the standard amendments. These amendments are expected to have only minor effects, if any, on KfW's net assets, financial and earnings position. We are currently assessing the standard amendments to IFRS 7 regarding disclosure requirements in the notes for financial instruments with conditional cash flows to determine their relevance for the group and the associated implementation effort. The future impact of IFRS 18 on presentation and disclosure in the financial statements is currently being examined.

Changes to material accounting policies

There were no changes to material accounting policies or estimates in the reporting period.

Judgements and accounting estimates

The consolidated financial statements include amounts based on management's judgements and/or estimates and assumptions which are determined to the best of our ability and in accordance with the applicable accounting standard. Actual results realised in a future period may differ from these estimates. Material judgements, estimates and assumptions are required, in particular, for calculating risk provisions (including risk provisions for lending business), recognising and measuring provisions (primarily for pension liabilities and legal risks), measuring the fair value of financial instruments based on valuation models (including determining the existence of an active market), determining remaining terms of leases, assessing and measuring impairment of assets, and assessing the utilisation of deferred tax assets. The estimates and the assumptions underlying these estimates are reviewed on an ongoing basis and are based, among other things, on historical experience or expected future events that appear likely given the particular circumstances. Where judgements as well as estimates and their underlying assumptions were required, the assumptions made are explained in the relevant notes.

KfW Group does not expect any deviations from its assumptions and does not foresee any uncertainties in its estimates that could result in a material adjustment to the related assets and liabilities within the next financial year. Given the strong dependency on the development of the economy and financial markets, however, such deviations and uncertainties cannot be fully ruled out. These risks are nevertheless low because valuation models -- especially those involving the use of inputs not based on observable market data -- are employed to measure only small parts of receivables, securities, investments and borrowings measured at fair value, on the one hand, and only a small portion of financial derivatives used to economically hedge risk, on the other hand.

The anticipated impact of the current geopolitical risks was taken into account in calculating risk provisions and fair values for equity investments within the framework of the established accounting policies.

Risk provisions for performing loans (Stages 1 and 2) are calculated using risk parameters which are geared to regulatory and internal credit risk models for the parameterisation of probability of default (“PD”), loss given default (“LGD”) and exposure at default (“EAD”) and adjusted to meet IFRS 9 requirements.

The persistent uncertainties regarding future economic developments were further addressed by considering a second, more conservative scenario (post-model adjustment). To reflect the greater forecast uncertainty regarding global economic developments (including the threat of trade conflicts between the USA, China and Europe), a second, more conservative scenario than in the previous quarters was taken into account as a post-model adjustment in the fourth quarter of 2024. The second scenario was weighted at 30% as of 31 December 2024, as in the previous year. Further information can be found in the note 37 “Risk provisions”.

In the first quarter of 2024, the regular reparameterisation and methodological development of the segment monitor, which forms the basis for the point-in-time adjustment of default probabilities, was undertaken with the aim of differentiating between the effects of cyclical risk drivers. In addition, various methodological developments were implemented in the models underlying the calculation of risk provisions in 2024. These relate in particular to the IFRS 9 non-retail business transfer criterion, the migration matrices and, for DEG, the further development of the LGD model and changes in offsetting personal collateral. The methodological developments described resulted in effects contributing to reduced risk provisioning in 2024, which more than offset the effect from the post-model adjustment and ultimately led to a reversal of risk provisions for performing loans. Environmental, social and governance risks (“ESG risks”) do not present new risks for the group to take into account, as Risk Management already addresses ESG risks in the context of business partner ratings, credit approvals and portfolio analyses as part of the group's risk strategy. They are therefore already reflected in the risk provisions for lending business and may also be reflected in the valuation of equity investments as part of a qualitative overall risk view.

Group of consolidated companies

All significant subsidiaries, joint ventures and associated companies are included in the consolidated financial statements.

Subsidiaries are all business units (including structured entities) over which the group exercises control. Control exists when a group is exposed or entitled to variable cash flows through its relationship and has the opportunity to use its power of disposal to influence the amount of such cash flows. Subsidiaries are included in the consolidated financial statements (full consolidation) from the point at which control is transferred to the group. They are deconsolidated when control is lost.

Joint ventures and associated companies are included in the consolidated financial statements in accordance with IFRS 11/IAS 28 if a joint agreement is in place or the group has significant influence. Significant influence exists when KfW can participate in financial and business policy decisions regarding the associated company even if it does not have sole or joint control.

The composition of the group of consolidated companies has changed since the consolidated financial statements as of 31 December 2023. Global Gender-Smart Fund S.A. SICAV-SIF (formerly Microfinance Enhancement Facility S. A.), Luxembourg, has not been accounted for using the equity method since financial year 2024, as KfW no longer has significant influence over this entity.

The composition of the consolidated group is presented in the Notes under “List of KfW Group shareholdings”.

Basis of consolidation

Consolidation involves revaluing the total assets and liabilities of the subsidiaries at the acquisition date, irrespective of the equity interest held, and incorporating them into the consolidated statement of financial position and accounting for them in subsequent periods in accordance with the applicable standards. If the revaluation adjustments result in an excess compared to acquisition cost, this excess amount is capitalised as goodwill. No goodwill is currently recognised.

Any intercompany assets and liabilities as well as expenses and revenues from transactions between consolidated group companies are eliminated through debt consolidation, or earnings and expenses consolidation, respectively. Intercompany profits between fully consolidated companies are also eliminated.

Investments in associates and joint ventures are accounted for using the equity method. The group's share of the profits or losses of associates and joint ventures is recognised in the “Net gains/losses from investments accounted for using the equity method” line item in the income statement.

There are no minority interests within KfW Group.

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

(7) Financial instruments

A. Classification and measurement

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. The rules under IFRS 9 "Financial Instruments" serve as the basis for recognition and measurement of financial instruments.

Classification of financial assets at initial recognition thus determines their subsequent measurement. Classification and subsequent measurement of debt instruments is based on the business model and characteristics of the contractual cash flows (solely payments of principal and interest, or "SPPI" criterion). Equity instruments, on the other hand, must always be measured at fair value.

IFRS 9 distinguishes between four categories of measurement for financial assets:

At amortised cost;
At fair value through profit or loss ("FVTPL"), with the two sub-categories: mandatory and designated;
At fair value through other comprehensive income ("FVTOCI") with no recycling into profit or loss (not used in the group);
At fair value through other comprehensive income ("FVTOCI") with recycling into profit or loss (not used in the group).

Instruments are assigned to business models on a portfolio basis. IFRS 9 provides for three business models to manage financial assets:

Hold to collect – financial assets are held with the objective of collecting contractual cash flows.
Hold to collect and sell – financial assets are held with the objective of both collecting the contractual cash flows and selling the financial assets (not used in the group).
Hold to sell – financial assets held with the objective of selling, or which do not fulfil the "hold to collect" or "hold to collect and sell" criteria.

The cash flow criterion is assessed for each individual financial asset as the second step. The cash flows of financial instruments are then checked for consistency with a basic lending arrangement and as to whether they thus constitute SPPIs on the outstanding loan balance. IFRS 9 defines interest as compensation for the time value of money and credit risk assumed, although it can also include a premium for liquidity risk. As is customary for the sector, compensation (e.g. for equity or administrative costs,) and a profit margin may also be included.

If payments contain payments beyond SPPIs, they must be measured at fair value. This also applies to non-recourse financing where the cash flows of the financed asset are increased or limited in such a way that they no longer constitute interest or principal payments in economic terms and the bank is consequently not exposed to a credit risk but rather to a project or investment risk.

A financing agreement condition does not affect classification if its effect on the contractual cash flows of the financial asset is only minor (de minimis). The group employs group-wide rules and a standardised classification of contractual covenants in assessing the SPPI criterion. For sustainability-linked loans in which the interest rate varies depending on compliance with defined ESG criteria, a de minimis threshold value is generally taken as the basis for assessing the SPPI criterion. The threshold value refers to the level of margin variability.

An assessment is made in non-recourse loans as to whether mitigation of the property or project risks creates a sufficient risk buffer and whether this then outweighs the credit risk.

A financial asset must have been allocated to a portfolio with the "hold to collect" business model and meet the cash flow criterion for measurement at amortised cost. The KfW business model is focused on a long-term sustainability approach. As the group does not enter into any transactions with the intention of generating a short-term profit, the Executive Board has decided on the "hold to collect" business model for

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all credit portfolios (except for the two cases mentioned below). Moreover, the group's lending business is largely consistent with the definition of a basic lending arrangement, and thus meets the SPPI criterion. The two exceptions to the "hold to collect" business model in the lending business are as follows:

Holding arrangements for the Federal Republic of Germany: Holdings KfW maintains by mandate for the Federal Republic of Germany are not subject to KfW management. Sales are to be executed upon the Federal Government's instruction. As KfW cannot assume that these positions will remain in the portfolio for the long term, it cannot assume a "hold to collect" intention.
KfW IPEX-Bank's syndication business: This business focuses on short-term sales and not on the objective of holding and selling the assets in equal measure.

Both cases of exception are assigned to the "hold to sell" business model. The holdings are measured at FVTPL.

Securities portfolios are also assigned to the "hold to collect" business model. This applies to the group's liquidity portfolio as well. As the group places minimum requirements on the ECB-eligibility of securities with regard to its liquidity portfolio, liquidity is secured by means of repo transactions. This therefore means that sales from the liquidity portfolio are unnecessary. The ancillary agreements are recorded and evaluated in the system to check the SPPI criterion. Securitisations are checked on a case-by-case basis to address the special rules for "contractually linked instruments". Consequently, the group's securities portfolios are largely measured at amortised cost using the effective interest method, as is its lending business.

The group's investments from equity finance are accounted for at fair value through profit or loss, as these are either equity instruments or debt instruments with no fixed interest or principal payments. The group does not exercise the option of FVTOCI for equity instruments.

Consequently, the group applies only the first two categories for financial assets: amortised cost and FVTPL.

IFRS 9 only provides for two categories for financial liabilities: amortised cost and FVTPL. Financial liabilities are accounted for at FVTPL if they are classified as held for trading (mandatory fair value) or assigned to this measurement category at initial recognition through application of the fair value option (designated fair value); otherwise they are accounted for at amortised cost. The classification must be irrevocably determined at initial recognition. Reclassification is not permitted.

All non-derivative financial liabilities are held for non-trading purposes in the group. All non-derivative financial liabilities for which the fair value option has not been exercised are classified as liabilities at amortised cost. These are thus measured at amortised cost using the effective interest method. For the group, this category covers funding reported in Financial liabilities at amortised cost (Liabilities to banks, Liabilities to customers and Certified liabilities). The fair value option is exercised for some structured liabilities such as promissory note loans (Schuldsscheindarlehen) and Certified liabilities. This concerns liabilities with bifurcated structures as well as liabilities with non-bifurcated structures for which there is an accounting mismatch unless they meet the requirements for application of hedge accounting. In exercising the fair value option, valuation effects resulting from changes in own credit risk are recognised directly in equity in the revaluation reserve.

Derivatives are concluded solely for hedging purposes in the group and measured at FVTPL.

Derivatives are recognised as of the trade date, and all other financial assets as of the settlement date. They are derecognised when the contractual rights from the assets have expired, the power of disposal or control has been transferred, or a substantial portion of the risks and rewards has been transferred to a third party unrelated to KfW Group. Financial liabilities are derecognised if the obligations specified in the contract have been discharged or cancelled, or have expired.

Financial instruments are initially recognised at fair value. Directly attributable transaction costs are included as incidental acquisition costs.

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Financial instruments subsequently measured at amortised cost are measured based on the fair value at initial recognition, taking into account any principal repayments, impairments, and where applicable, contractual amendments. The amortisation of premiums and discounts, transaction costs and fees is performed in accordance with the effective interest method on the basis of the contractual cash flows. Discounts are amortised in the promotional lending business until the end of the first fixed interest rate period (generally five to ten years).

Subsequent measurement at fair value for recognition in the financial statements or for the disclosure of financial instruments in the Notes is presented in Section D. "Fair value" below.

In accordance with Article 2 (4) of the KfW Law, the German Federal Government may mandate transactions to KfW on a case-by-case basis involving a public interest on the part of the Federal Republic of Germany. Such transactions are referred to as mandated transactions. This means that KfW is mandated by the Federal Government to enter into or acquire certain financial instruments. Both equity and debt instruments can be used for such purposes. Mandated transactions are accounted for by applying the generally accepted IFRS rules on additions and disposals, but also on the receipt of income.

Due to the supplemental agreements with the Federal Government often associated with mandated transactions, the disposal criteria and, in particular, the existence of on-lending agreements must also be checked. In addition, a review of the initial recognition of the relevant financial instruments must be conducted. On-lending agreements ensure that cash flows between KfW and the respective party to the agreement are ultimately passed on to the Federal Government. While the disposal criteria are normally not met with respect to debt instruments, they are generally met when applied to equity instruments, and the financial instrument is thus de-recognised immediately after initial recognition in the statement of financial position. Equity instruments resulting from mandated transactions are therefore not recognised in the financial statements, but are included in disclosures on trust activities in the notes.

B. Impairments

In the group, provisions for loan losses are accounted for in accordance with IFRS 9 requirements and applied to the following financial instruments:

Loans and receivables as well as third-party securities measured at amortised cost;
Loan commitments not measured at fair value through profit or loss;
Financial guarantees not measured at fair value through profit or loss.

Impairments are calculated based on a three-stage model. All assets are assigned to Stage 1 at initial recognition and an impairment is calculated that is equivalent to the 12-month expected credit loss ("ECL").

Subsequently, expected credit losses are calculated based on changes in a financial instrument's credit risk since initial recognition. If there has been a significant deterioration of the credit risk (Stage 2) or objective evidence of impairment is identified (Stage 3), expected credit losses are to be calculated over the remaining lifetime (lifetime ECLs). If, in contrast, there has been no significant increase in credit risk, the financial instrument is still assigned to Stage 1 and only the ECLs for the term of the instrument resulting within the next 12 months from potential loss events are taken into account.

A lifetime ECL is recognised for financial instruments in Stage 2 as risk provisioning. This is based on risk parameters oriented to regulatory and internal credit risk models for parameterisation of probability of default ("PD"), loss given default ("LGD") and exposure at default ("EAD"). Interest income for financial instruments in Stage 2 is recorded using the effective interest method based on the gross carrying amount.

A lifetime ECL is also recognised for financial instruments in Stage 3 as risk provisioning. Assignment to Stage 3 and thus classification as impaired is undertaken in line with the group-wide default definition, which reflects the definition of "default of an obligor" in accordance with Article 178 of the Capital Requirements Regulation ("CRR"). The definition distinguishes between the 90 days past due and unlikely to pay criteria. A distinction is made in calculating impairment in Stage 3 between significant (non-retail) and non-significant

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(retail) financial instruments. Impairment for retail business in Stage 3 is calculated based on risk parameters and applying a PD of 1. Individual impairment is recognised for incurred losses and is computed on the basis of individual loans for significant portfolios in the lending business. The amount of the impairment loss equals the difference between the carrying amount of the loan and the present value of discounted expected future cash flows from interest, redemption payments and collateral cash flows. Any reversals of individual impairment losses are accounted for through profit or loss. Interest income for these financial instruments is recognised based on the net carrying amount.

In contrast to the lending business, expected losses for defaulted securities are not calculated based on cash flow but instead on market values in Stage 3. This is due to the assumption that the market value in the case of impairment is primarily influenced by credit rating factors.

Purchased or originated credit-impaired financial assets ("POCI") are not significant due to the group's business model. The group has therefore decided not to separately disclose these special requirements. If there are individual cases that meet the POCI definition, they will be assigned to Stage 3 based on the default rating at the time of purchase.

The group takes a nuanced approach to assignment to stages that takes both rating and qualitative information into account.

It uses the change in the probability of default over the remaining term (lifetime PD) compared with the probability of default expected for this period at initial recognition (forward lifetime PD) as a basis to assess whether a transaction can migrate from Stage 1 to Stage 2. This ensures that only transactions for which there is a significant deviation from the originally expected probability of default are transferred to Stage 2. Concessions (contractual modifications) made to the obligor for economic or legal reasons (forbearance), are also considered as a factor in transfer to a subsequent stage.

As there is no individual rating specific to an obligor in the retail business, transfers from Stage 1 to stage 2 are based on other credit deterioration indicators, such as negative factors or 30-days-past-due status.

The group does not exercise the option of waiving assessment on whether there has been a significant increase in credit risk, if the instrument is determined to have low credit risk at the reporting date (low credit risk exemption).

The IFRS 9 impairment model takes a symmetrical approach to migration, meaning that forward migration to Stage 2 or Stage 3 as well as reversion back from Stages 2 and 3 are possible. Periods of good conduct are defined for the retail business, based on previous past-due status (>30 days) or default. These range from 90 days to two years, depending on the specifics of the case. This accounts for the fact that no rating-based transfer criterion is applied to the retail business, and therefore, for example, in the absence of a payment default (>30 days) without a good conduct period, there would be an immediate reversion to Stage 1.

Expected credit losses for Stage 1 and Stage 2 and the retail business in Stage 3 are calculated based on individual transactions using statistical risk parameters. The regulatory and internal credit risk models for parametrisation of PD, EAD and LGD that are used in risk management serve as the basis for this calculation. These parameters are adequately adjusted to determine expected credit losses in accordance with IFRS 9. This enables largely uniform credit risk modelling in line with supervisory law, risk management and IFRS requirements even though they may individually differ somewhat in scope. Therefore, essentially best estimate parameters are used to determine the expected credit loss; margins of conservatism are not included. Downturn components are only taken into account in the risk parameters in crisis situations.

Calculation of one-year PD is based on the internal rating system, in which every exposure is assigned a PD score that corresponds to a rating scale of 18 levels for non-defaulted transactions ("PL") and two levels for defaulted transactions ("NPL"). The lifetime PDs are derived from the one-year PD via migration matrices. For IFRS-9-compliant PD modelling, the internal credit risk parameters are adjusted by placing a greater

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weight on macroeconomic factors from a point-in-time ("PIT") perspective. The adjustment is made through segment and rating-specific modelling of PD premiums and discounts on regulatory PD (through-the-cycle PD). This is based on expert estimates of the economic situation of sectors and countries, with assessment of expected effects, taking into account forward-looking information. This approach differs for the retail business, for which premiums and discounts are calculated applying an expert model based on econometric factors.

LGD is the loss ratio that results in the event of default after taking collateral into account. In accordance with IFRS 9 impairment requirements, a multi-year view without taking internal costs into account is generally required. The regulatory LGD parameters are adjusted accordingly in order that internal costs for IFRS 9 are not included in the calculation of expected credit losses.

The EAD per time bucket corresponds to the loan drawdown expected at the time of default, taking into account additional drawings on open lines of credit. For the off-balance sheet portion, the expected drawdown is calculated based on credit conversion factors ("CCFs").

In times of greater uncertainty, the economic environment is taken into account in addition to the point-in-time adjustment of default probabilities by means of a further macroeconomic scenario.

Risk provisions for on-balance sheet lending and securities business are deducted directly from the statement of financial position item Financial assets at amortised cost. Risk provisions for the off-balance sheet lending business are accounted for on the liabilities side under Provisions (sub-item: Risk provisions for lending business).

The credit risks resulting from the on- and off-balance sheet lending business and from financial assets measured at amortised cost are accounted for through impairments recognised in profit or loss in the amount of the one-year expected credit loss (Stage 1) or the lifetime expected credit loss (Stage 2 and Stage 3). Additions to and reversals of risk provisions are recognised in Net gains/losses from risk provisions in the income statement.

An asset is written off in the event that it, or a portion thereof, is estimated as irrecoverable (write-off). In the non-retail business, this is not performed until there is no longer a prospect of recovery, as, for instance, all collateral has been realised or, in the event of insolvency, creditor quotas have been distributed or insolvency proceedings have been discontinued for lack of assets. Write-offs in the retail business are performed pursuant to defined criteria such as insolvency or a fixed default period, both of which are related to termination of the loan. Recovery is pursued as long as it is economically viable.

In the case of a write-off, the gross carrying amount is reduced by the amount of the write-off. Current provisions for loan losses are utilised first, and any remaining amount is written off directly. Similar to recoveries on loans already written off, this direct write-off is also reported through profit or loss in the Net gains/losses from risk provisions item.

C. Contractual modifications

Contractual modifications are credit rating or market-induced adjustments to contractual cash flows. By contrast, an adjustment of contractual payments agreed at the time the contract was concluded is not deemed a contractual modification.

Substantial contractual modifications result in derecognition of financial assets even if the same or the modified contract legally remains valid. The modified financial instrument is treated in accordance with IFRS 9 as a new contract and reclassified on the basis of classification criteria. Derecognition resulting from substantial modification is not relevant for the "hold to collect" business model.

There is no write-off for non-substantial contractual modifications. Instead, the gross carrying amount is adjusted to the present value of the modified cash flows calculated using the original effective interest rate. This valuation difference is recognised in profit or loss as a modification gain or loss and amortised through net interest income on subsequent reporting dates.

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The modification list serves as the group-wide basis for identification of relevant contractual modifications. This distinction between substantial and non-substantial modification is normally made based on qualitative criteria such as contractual amendments that result in a violation of the cash flow criterion within the meaning of IFRS 9 4.1.1(b).

In the event of a non-substantial modification, an assessment must be made of whether the credit risk has increased significantly and whether a stage transfer may consequently be necessary. This ensures that a credit risk-related contractual modification triggers an ad hoc rating as an early warning signal or at least a documented review of the need for an ad hoc rating in accordance with requirements for early detection of risks. This current rating is taken into account accordingly in the assignment to stages.

D. Fair value

Subsequent measurement at fair value, which, depending on the measurement category, is regularly determined either for recognition in the statement of financial position or for the disclosure of financial instruments in the Notes, is based on the following hierarchy at KfW Group:

Active market – allocation to level 1 (Quoted market price)

The best objective evidence of fair value is provided by published price quotations in an active market. A financial instrument is regarded as quoted in an active market if quoted prices are readily and regularly available and those prices represent current – i.e. traded on the date of conclusion or shortly before – and regularly occurring market transactions on an arm's length basis. Together with the traded nominal volumes, the contract sizes and the number of contracts, this assessment takes into account in particular the bid-ask spreads observed which in the event of a significant increase indicate the absence of an active market.

No active market – allocation to level 2 (Valuation methods based on observable market data [model]) or level 3 (Valuation methods based in part on data not observable in a market)

If the financial instrument is not quoted in an active market, valuation techniques are used. The valuation techniques applied include, in particular, the discounted cash flow ("DCF") method and option pricing models, as well as a comparison to the fair value of a financial instrument with almost identical characteristics (e.g. multiple-based models). The valuation techniques take account of all input parameters that the market participants would include in the pricing of that financial instrument, e.g. market interest rates, risk-free interest rates, credit spreads or swap curves. As these input parameters can generally be observed in the market and are usually the only significant parameters for measuring financial instruments using valuation techniques, the level for the financial instruments measured at fair value using valuation methods is usually level 2. This allocation also generally applies for prices quoted on inactive markets published by price service agencies.

If significant input parameters that are not observable on the market, such as expected risk-free customer margins or capital costs, are used in valuation techniques, the financial instrument is allocated to level 3.

If, at the date of initial recognition, differences arise between the market-based transaction price and the model price resulting from a valuation technique that makes significant use of unobservable parameters, an analysis is performed to determine whether there are economic reasons for these initial differences (e.g. conclusion of a transaction on a market that is not the main market for this transaction). These economic reasons only apply to a small part of the derivative portfolio of KfW Group, which comprises a hedging instrument for customers with respect to the export and project financing business. In relation to this, OTC (over the counter) derivatives in line with the market are not concluded on the main market (OTC interbank market) relevant to valuation. The initial differences determined upon conclusion of these derivatives are amortised through profit or loss over the life of the financial instruments, as the valuation parameters unobservable on the market are relevant to the valuation procedure. The reliability of this valuation technique is ensured via regular model validations.

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This (valuation) hierarchy is applied in the group as follows:

Fair values are derived from active markets, in particular, for bonds and other fixed-income securities – unless there are inactive markets, and valuation techniques or prices quoted on inactive markets published by price service agencies are therefore used – as well as own issues reported on the liabilities side. Valuation techniques for non-derivative financial instruments are used primarily for products reported under Financial assets at fair value (loans and advances to banks, loans and advances to customers, and equity investments) and Financial liabilities at fair value (liabilities to banks, liabilities to customers, and certificated liabilities). Valuation techniques are also used for OTC derivatives.

The steps detailed below are taken for certain product groups:

For securities in the Securities and investments line item, the group examines whether a financial instrument is quoted on an active market on the basis of homogeneous portfolios. Market activity is assessed based on the following criteria:

There is more than one market maker.
Prices are set on a regular basis.
Prices deviate only slightly between market makers.
The bid-ask spread is narrow.

Prices on active markets are used to determine the fair value of the group's asset securities as of the reporting date. In addition, for parts of the portfolio, prices from price service agencies are used that do not qualify as prices quoted on active markets. Should these not be available in individual cases, valuation techniques are used to determine fair value taking into account observable market parameters. The input parameters include, in particular, changes in creditworthiness and risk-free interest rates, but they also take into account general and financial instrument-specific tightening of the market due to lower liquidity.

In measuring OTC derivatives, valuation adjustments are determined for counterparty risks (credit valuation adjustments – “CVA”), own default risk (debt valuation adjustments – “DVA”), collateral costs under credit support annexes (“CSA”) (collateral valuation adjustments – “ColVa”) and funding cost adjustments (“FCA”). KfW’s institute-specific funding costs are used to calculate the FCA. Value adjustments are not calculated separately for each transaction but for the portfolio of transactions on which a framework agreement is based. The allocation to individual transactions is based on the relative credit adjustment approach. The resulting adjustment amounts are very low as KfW generally pledges collateral for positive market values in accordance with standard market collateral agreements. In accordance with market practices, risk-free overnight interest rates are used for the valuation of the derivatives portfolio.

The fair value of Loans to banks and customers is calculated using the discounted cash flow ("DCF") method based on the discounting of the risk-adjusted cash flows. The expected loss calculated for the respective reporting date is used to correct the contractual cash flows.

The holding arrangements for the Federal Republic of Germany are accounted for as receivables from the Federal Government. The receivables comprise the KfW-funded purchase price of the items held for the Federal Republic of Germany as well as an additional benefit from the sales proceeds of the items. The receivables are measured at fair value, with the additional benefit being accounted for as a key value driver using current market prices of the items held.

Valuation methods based on net asset value for fund investments are also used in addition to the discounted cash flow method for valuation of direct investments. Due to the three-month time lag between the group's reporting date (31 December 2024) and the reporting date for the equity funds (30 September 2024), the net asset values are adjusted, if necessary, in the event of short-term changes in the economic environment or new information regarding individual investments. In this context, listed investments within the fund investments are also valued as of the balance sheet date 31 December 2024. If identical investments are held via several funds, the valuations are reviewed and standardised.

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The Federal Republic of Germany's liability for specific KfW liabilities in accordance with Article 1a of the KfW Law has an advantageous effect on KfW's ability to refinance itself. In determining the fair value of KfW's liabilities, the effect of this explicit direct state guarantee is also taken into account. The state guarantee does not represent an independent unit of account.

The fair value of financial instruments due on demand, such as Cash reserves or receivables and liabilities due on demand, is their carrying amount.

When no prices from liquid markets are available and prices on inactive markets cannot be provided by price service agencies, recognised valuation models and methods are used. The DCF method is used for securities, swaps, and currency and money market transactions with no embedded options or complex coupons. Stand-alone options, as well as derivatives with embedded options, triggers, guaranteed interest rates and/or complex coupon agreements, are measured using recognised models (e.g. Hull & White) unless they are listed on a stock exchange.

The aforementioned models are calibrated, if possible, on the basis of observable market data for instruments that are similar in terms of the type of transaction, maturity, and credit quality.

E. Financial guarantee contracts

A financial guarantee contract is a contract that requires the guarantor to make specified payments that compensate the holder for a loss it incurs because a specified debtor fails to meet its contractual payment obligations. For the guarantor, a financial guarantee contract is to be measured at fair value at initial recognition, which is zero at contract conclusion, as the value of the premium on fair value contracts is equal to the value of the guarantee obligation (net presentation). Moreover, fair value at initial recognition is no longer carried forward in such net presentation, but rather incoming premium payments are recognised through profit or loss in Net commission income. If a financial guarantee contract is not designated to the fair value measurement category at initial recognition, a provision is recognised for expected losses from a financial guarantee as part of a subsequent assessment, applying IFRS 9 rules for risk provisioning. The group does not voluntarily designate financial guarantee contracts for measurement at fair value.

For the holder, on the other hand, this is a contingent asset that may not be capitalised. However, a (non-impaired) financial guarantee contract is, for the holder, collateral that may be included in calculating risk provisions for the recognised reference asset.

Provisions for expected losses from financial guarantees are reported under Provisions for credit risks.

F. Reporting and Notes

Current interest and similar income from a financial asset are generally recorded under Interest income. If, due to the low interest environment, negative interest rates arise from a financial asset, these are also recorded in Interest income, with a minus sign. Premiums, discounts, processing fees and charges are amortised in Interest income using the effective interest method. Processing fees that are not amortised under the effective interest method are recognised under Commission income.

Any fair value changes of financial assets at fair value through profit or loss are recognised in Net gains/losses from other financial instruments at fair value through profit or loss.

Current interest arising from a financial liability is recorded in Interest expense. This also applies in the case of negative interest resulting from a low interest rate environment. Premiums and discounts are also amortised in Interest expense using the effective interest method over the expected life.

Results from the repurchase of own issues categorised as liabilities measured at amortised cost are recognised at the repurchase date in Net other operating income.

Classes for financial instruments have been largely defined in agreement with the group's business model which is focused on the lending business. The definition is based in particular on the national requirements for balance sheet classification at banks and financial services institutions. The following classes (and sub-classes) were defined for financial assets and financial liabilities:

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

Transition of the statement of financial position items for financial instruments to classes in accordance with IFRS 7.6

Statement of financial position item	Class	Sub-class
Financial assets at amortised cost	Loans and advances to banks	Money-market transactions
		Loans and advances
		Promissory note loans
		Other receivables
	Loans and advances to customers	Money-market transactions
		Loans and advances
		Promissory note loans
		Other receivables
	Securities and investments	Bonds and other fixed-income securities
Financial assets at fair value	Loans and advances to banks	Money-market transactions
		Loans and advances
		Promissory note loans
		Other receivables
	Loans and advances to customers	Money-market transactions
		Loans and advances
		Promissory note loans
		Other receivables
	Securities and investments	Bonds and other fixed-income securities
		Shares and other non-fixed income securities
		Equity investments
		Shares in non-consolidated subsidiaries
	Other derivatives	Interest-related derivatives
		Cross-currency derivatives
		Other derivatives
Financial liabilities at amortised cost	Liabilities to banks	Money-market transactions
		Promissory note loans
		Other financial liabilities
	Liabilities to customers	Money-market transactions
		Promissory note loans
		Other financial liabilities
	Certificated liabilities	Money-market issues
		Bonds and notes
Financial liabilities at fair value	Liabilities to banks	Money-market transactions
		Promissory note loans
		Other financial liabilities
	Liabilities to customers	Money-market transactions
		Promissory note loans
		Other financial liabilities
	Certificated liabilities	Money-market issues
		Bonds and notes
	Other derivatives	Interest-related derivatives
		Cross-currency derivatives
		Other derivatives

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In addition, the items from the asset and liability sides of the statement of financial position, Value adjustments from macro fair value hedge accounting, Derivatives designated for hedge accounting, and Off-balance sheet transactions each form a separate class.

The Loans and advances to banks class primarily consists of the promotional lending business, in which loans are typically granted to the final borrowers through accredited commercial banks. These assets are presented in this class when the commercial banks underwrite part of the liability. Promotional loans that commercial banks on-lend without underwriting of liability are recognised in the class Loans and advances to customers.

The Loans and advances to banks and Loans and advances to customers classes also include loans that benefit from a subsidy (interest rate reductions) granted by KfW under the ERP economic promotion programme. The promotional grants awarded annually to KfW through the ERP Special Fund based on the ERP Economic Planning Act (ERP-Wirtschaftsplangesetz) for the purpose of executing the ERP economic promotion programme are recognised as deferred income in Other liabilities and are amortised in profit or loss under Interest income as the underlying funding expenses occur.

The Securities and investments class mainly comprises bonds and other fixed-income securities held in securities portfolios that belong to KfW and its subsidiaries, along with equity investments.

The securities portfolios mainly serve to support KfW's liquidity position and to stabilise and ensure the group's promotional capacity in the long term.

To achieve the same accounting treatment for equity investments with and without significant influence, individual group business areas that provide equity finance as part of their promotional mandate are considered as venture capital organisations for accounting purposes provided they meet the respective requirements. These equity investments, like other equity investments, are allocated to the Securities and investments class.

The Liabilities to banks and Liabilities to customers classes largely comprise KfW Group borrowings and money-market transactions.

Issued bonds, notes and money market securities are allocated to the Certificated liabilities class. Own issues repurchased in the open market are deducted from the liabilities as of the repurchase date.

In some of the Notes, these classes are broken down into additional sub-classes that relate mainly to products (for example, Loans and advances to banks are reported separately for money-market transactions and loans and advances).

Information about the type and extent of risks associated with financial instruments is also provided in the risk report section of the combined management report.

(8) Derivatives and hedging relationships

A. Hedging transactions/Hedge accounting

KfW Group enters into financial derivatives to economically hedge interest rate fluctuation and currency risks, particularly those related to funding, lending and securities activities. Interest rate swaps, interest rate/currency swaps and base currency swaps are mainly used for this purpose. Interest rate swaps are used to convert fixed rate interest payments of the issuances or lending transactions into variable payments. In the case of refinancing in a foreign currency, payments are also converted into the functional currency (EUR). The hedge ratio for the issues is normally 1:1. Ineffectiveness therefore results exclusively from unhedged risks such as counterparty risk or tenor or basis spread risks.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

Economic hedging relationships are designated as hedge accounting relationships or designated as fair value through profit or loss by using the fair value option when the IFRS requirements are met. Economic hedging relationships can also be recognised in the financial statements through bifurcation of separable embedded derivatives on the liabilities side that are accounted for through profit or loss. In these cases, if the hedges are economically effective, the impact on the financial statements, with respect to the hedged risks, from the instruments used for hedging purposes and the hedged transactions will substantially offset each other, so that the group's income statement substantially reflects the risk-mitigating impact of these hedging relationships.

However, not all economic hedging relationships qualify for hedge accounting or the fair value option. In these cases, the risk-mitigating impact of the derivatives used for hedging purposes is not reflected in the accounts because the hedged risk associated with the underlying transactions is not recognised in profit or loss under IFRS. The applicable recognition requirements may therefore lead to one-sided valuation results from the derivatives used for hedging purposes in the group's income statement – as well as volatility in profit or loss – despite an economically effective hedging relationship.

Hedge accounting in the group is used solely in the form of fair value hedges to recognise economic hedging relationships. The hedging relationship is designated, firstly, at individual transaction and group level in the form of micro fair value hedge accounting, and, secondly, at portfolio level in the form of macro fair value hedge accounting. The group has exercised the option of applying IAS 39 rules for hedge accounting. If risk-free overnight interest rates are used in the valuation of the derivatives, this market practice is also subject to micro fair value hedge accounting for the measurement of the hedged risk related to the hedged item. The hedged risk in macro fair value hedge accounting generally relates to the variable interest rates of the derivative portfolio. The effectiveness of the hedging relationships is assessed using the dollar offset method and a regression analysis (80%–125% range for assessing effectiveness).

In micro fair value hedge accounting, interest and currency risks from bonds allocated to Securities and investments (in the Financial assets at amortised cost item) and, above all, from borrowings (in the Financial liabilities at amortised cost item) are hedged. In micro fair value hedging relationships at individual transaction level, the fair value changes attributable to the hedged risks are reported as an adjustment of the carrying amount of the hedged items with the corresponding gain or loss recognised under Net gains/losses from hedge accounting. The hedging instruments used for this purpose are recognised at fair value in Derivatives designated for hedge accounting. Changes in the value of the hedging instruments are also recognised in Net gains/losses from hedge accounting, largely compensating the profit or loss effects of the hedged items.

Macro fair value hedge accounting is used to hedge against interest risks primarily from loan receivables (in the Financial assets at amortised cost item) and firm obligations via future fixed-rate financing that are hedged against interest risks as part of dynamic asset liability management in the group. The fair value changes attributable to the hedged risks in the hedged portfolios in the Amortised cost category (loans and advances/liabilities) are accounted for in Value adjustments from macro fair value hedge accounting on the assets or liabilities side. Fair value changes attributable to the hedged risks from the hedged portfolios are reported in Net gains/losses from hedge accounting.

The hedging instruments are reported at fair value in Derivatives designated for hedge accounting. Changes in the value of these instruments are also recognised in Net gains/losses from hedge accounting, with the effect that they almost fully offset the earnings effects from the valuation of the hedged portfolios.

The portfolio of hedged items is updated monthly in the context of a dynamic hedge de-designation and designation process. The resulting fair value adjustments are amortised over the residual term of the maturity period in Net gains/losses from hedge accounting. Disposals from the hedged portfolios result in a proportional amortisation of the related fair value adjustments in Net gains/losses from hedge accounting. When cash flows from hedging instruments are derecognised while the economic hedge based on non-derivative financial instruments remains, the related fair value adjustments from the hedged portfolios are amortised in Net interest income.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

If the strict hedge accounting requirements for the designation of hedging relationships between derivatives and financial assets/liabilities are not fulfilled within KfW Group, the fair value option is used in certain circumstances. The fair values of the hedging instruments are presented in Financial assets at fair value or Financial liabilities at fair value, and the changes are presented in Net gains/losses from other financial instruments at fair value through profit or loss. These are largely offset by valuation effects from the hedged transactions. Fair value changes in liabilities resulting from changes in KfW's own credit risk are directly recognised in Other comprehensive income ("OCI").

Further derivative financial instruments are used to hedge risks, but their economic hedging relationships are not reflected in the accounts. The fair values of these hedging instruments are also presented in Financial assets at fair value or Financial liabilities at fair value, and the changes are presented in Net gains/losses from other financial instruments at fair value through profit or loss.

KfW Group neither uses derivatives for trading purposes nor does it enter into derivatives acting as a broker or intermediary on behalf of third parties.

B. Embedded derivatives

Derivative financial instruments can be part of a hybrid (combined) financial liability as embedded derivatives. Under certain conditions, they are accounted for separately from the host contract, similar to stand-alone derivatives. They must be bifurcated if the economic characteristics and risks of the embedded derivative are not closely related to the economic characteristics and risks of the host contract. The host contract is accounted for according to its classification at inception.

KfW Group enters into contracts with separable embedded derivatives particularly with respect to its own funding. In the case of these products, the embedded derivatives must be bifurcated and recognised separately. Changes in fair value are then recognised in Net gains/losses from other financial instruments at fair value through profit or loss in the sub-line item Financial derivatives not qualifying for hedge accounting, where they have a compensatory effect on the valuation of the economic hedging derivatives.

The fair value option was selected for certificated liabilities with bifurcated (embedded) derivatives recorded prior to bifurcation.

(9) Offsetting of financial instruments

KfW uses the EUREX central clearing system to settle some of its derivative transactions. This form of settling derivative transactions results in the recognition of a net amount in the statement of financial position for the transactions affected, as the involvement of EUREX as the central counterparty ("CCP") meets all of the requirements for offsetting as set out in the relevant IFRS standard. This means that positive and negative fair values of derivatives for which EUREX acts as the central counterparty are offset against the corresponding collateral and reported in a net item in the statement of financial position.

In the case of reverse repo and repo transactions, for which EUREX acts as the central counterparty, receivables and liabilities are also offset if the currencies and the value dates are the same.

In addition, framework agreements featuring netting agreements are in place between KfW and its business partners for OTC derivatives and securities repo transactions.

One form of netting is close-out netting, which provides for the elimination of all rights and obligations relating to individual transactions under the framework agreement upon termination of said framework agreement by the contractual partner, or upon the latter's insolvency, with the rights and obligations replaced by a single compensation claim (or obligation) in the amount of the net replacement costs of the terminated individual transactions. This does not represent a present legal claim for offsetting.

Close-out netting is not to be confused with the offsetting of payments in normal business. The same framework agreement may provide for the latter, i.e. that payments due on the same day and in the same currency may be offset and a net payment made instead of each individual payment (payment netting). This represents a present legal claim for offsetting.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

All of KfW's framework agreements relating to bilateral OTC derivatives (not in central clearing) include close-out netting agreements with the business partners. Payment netting is limited in the agreement to the relevant individual transaction, so that multiple transaction payment netting does not occur. The requirements for offsetting financial assets and financial liabilities are therefore not met for these KfW OTC derivatives.

KfW's framework agreements for repo transactions include close-out netting agreements and, in some cases, payment netting agreements with the business partners as well. However, as KfW does not, as a rule, perform multiple transaction payment netting with repo transactions, the requirements for the offsetting of financial assets and financial liabilities are not met for such KfW repo transactions.

In accordance with the collateral agreements concluded for OTC derivatives and repo transactions, the values of the available collateral are used in determining the single compensation claim (or obligation) in close-out netting. Both cash and securities are permitted forms of collateral under the existing collateral agreements between KfW and its business partners. The collateral agreements provide for a transfer of title in the case of securities as collateral. Consequently, the transferred securities are not subject to any selling or pledging restrictions.

(10) Foreign currency translation

The functional currency of KfW and its consolidated subsidiaries is the euro. Monetary assets and liabilities denominated in a foreign currency are converted at the spot rate as of the reporting date.

Non-monetary assets and liabilities denominated in a foreign currency are normally converted at historical rates if they are measured at (amortised) cost. Currency translation is based on the European Central Bank reference rates.

The changes in value resulting from foreign currency translation are reported in the income statement under Net gains/losses from other financial instruments at fair value through profit or loss.

(11) Revenue from contracts with customers

IFRS 15 defines the nature, amount and timing of revenue arising from contracts with customers. Such revenue includes fees which are not an integral part of the effective interest rate and which are reported under Commission income. In this context, a five-step principle-based model is to be applied to relevant customer contracts. Moreover, the Notes are to include comprehensive detailed quantitative and qualitative information. IFRS 15 does not apply to fees and charges that are an integral part of the effective interest rate as they fall under the scope of IFRS 9.

There are primarily mandate contractual arrangements with the Federal Government as contracting authority within the meaning of IFRS 15. They include fees for the administration of German Financial Cooperation for the promotion of developing countries and emerging economies, fees for the administration of certain programmes subsidised by the Federal Government, and fees for debt collection on certain loans. The group also charges fees for administrative services for other mandate agreements as well as for processing services and for services for lending and trust activities. Individual services may be grouped together into a bundle of services that qualifies as a separate performance obligation within the meaning of IFRS 15. The value of the transaction is therefore not broken down.

As performance obligations are mostly satisfied over time, revenue from customer contracts is recognised according to the measure of progress and is thus normally recognised over time.

KfW Group has no items that require recognising customer acquisition or contract fulfilment costs as assets. One-time advance payments to be allocated are deferred and recognised as contract liabilities in the statement of financial position under Other liabilities.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

If the service has already been performed but fees have not yet been paid or if there is not yet any claim to payment, a contract asset is to be recognised in the statement of financial position under Other assets. If the claim becomes unconditional, the contract asset is to be reclassified as a Trade receivable adjusting the carrying amount where applicable. This rule is applied to fees for administration of certain programmes subsidised by the Federal Government. Based on the credit rating and short remaining life, no expected credit loss is calculated.

(12) Promotional lending business at KfW

The general promotional loans market, which distinguishes itself from the market for general lending business, is relevant for KfW's promotional lending business conducted as part of its legal promotional mandate. This market is characterised by the fact that promotional banks, as part of their legal mandate, pass on all funding advantages to the ultimate borrowers in financing projects eligible for promotion. In setting the terms and conditions of the corresponding promotional loans, KfW uses its current term-differentiated refinancing rates.

At initial recognition of such loans, the fair value is thus equivalent to the transaction value.

KfW also grants promotional loans which include additional subsidies granted during the first fixed interest rate period, in the form of interest rate reductions impacting KfW's earnings position. The fair value of these promotional loans – measured using the parameters of the general promotional loan market – is thus not equivalent to the transaction value at initial recognition as in this case the interest rate is below the market rate.

The difference that normally results from such loan commitments – present value of the nominal scheduled interest rate reductions during the first fixed interest rate period – is recognised in profit or loss as an interest expense and accounted for as an adjustment to the carrying amount in loans and advances under the item Financial assets at amortised cost. The adjustment to the carrying amount is amortised in Net interest income using the effective interest rate method. In the event of unscheduled repayment in full, this is recognised in profit or loss under Interest income.

Differences that relate to irrevocable loan commitments are reported in Provisions. Changes to the portfolio are offset via the adjustments to the carrying amounts of already disbursed promotional loans recognised on the assets side.

(13) Non-current assets held for sale

Under IFRS 5, separate presentation and measurement requirements apply to non-current assets held for sale if the assets are available for immediate sale and such sale is highly probable. Assets that meet the IFRS 5 criteria are reported in the separate statement of financial position item: Non-current assets held for sale. The IFRS 5 measurement requirements are not applied if they relate to financial assets. In this case, the IFRS 9 measurement requirements continue to apply instead.

(14) Repurchase agreements and securities lending

KfW Group enters into repurchase agreements as standardised repos or reverse repos. These are combinations of simultaneous spot and forward transactions on interest-bearing securities with the same counterparty. The terms and modalities of collateral and its use follow common market practice. Credit claims are also an eligible type of collateral for open-market transactions.

The interest-bearing securities sold under repo transactions (spot sales) continue to be recognised and measured under Financial assets at amortised cost. The repayment obligation towards the counterparty is carried under Financial liabilities at amortised cost for the amount of cash consideration received. The repo rate as a fee for borrowing is recorded by the group, as the borrower, under Interest expense over the term of the agreement. The borrower is entitled to the coupon on the security. A repayment claim is recognised and measured under Financial assets at amortised cost for the amount of cash outflow generated by reverse repos. The securities received (spot purchases) are not recognised or measured. The repo rate as a fee for lending is recorded in the group as the lender under Interest income over the term of the agreement.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

The term “securities lending” refers to transactions in which securities are transferred from the lender to the borrower with the obligation that the borrower transfer back securities of the same type, quality and quantity at the end of the agreed term and pay a usage fee for the duration of the loan. IFRS 9 does not distinguish between collateralised and uncollateralised securities lending. The cash collateral generally to be pledged to the lender is to be capitalised as a receivable by the borrower under the item Financial assets at amortised cost. The securities are accounted for by the lender, which bears the credit and market risk.

With respect to the refinancing of the loans mandated to it for the energy sector support measures, KfW acts as both borrower and lender in essentially uncollateralised securities lending transactions in dealing with the German Finance Agency, although as a lender it does not recognise the securities. They remain capitalised at the German Finance Agency. KfW recognises the cash collateral received under the item Financial liabilities at amortised cost.

The fee received or paid is recognised in Net interest income.

(15) Property, plant and equipment

The land and buildings and the plant and equipment reported by KfW Group are carried at cost less depreciation on a straight-line basis and any impairment, both recognised in Administrative expense. In accordance with the requirements in IAS 36, an impairment is recognised if there are indications of impairment and the carrying amount of the asset exceeds the recoverable amount, i.e. the lower of fair value less costs of disposal and value in use. The useful life is determined based on expected wear and tear. KfW Group assumes an estimated useful life of 40 to 50 years for buildings, four years for workstation computer equipment and five to 15 years for other property, plant and equipment. Gains and losses from the sale of property, plant and equipment are recognised in Net other operating income.

Payments in advance and assets under construction are recognised in Other property, plant and equipment and are not subject to depreciation.

(16) Leases

In accordance with IFRS 16 “Leases”, KfW as lessee reports each right of use in Property, plant and equipment and the associated lease obligation in Other liabilities. The lessee shall measure the lease liabilities at the present value of the lease payments not paid at that date, discounted at the lessee’s incremental borrowing rate. The incremental borrowing rate is the rate of interest that a lessee would have to pay to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value to the right-of-use asset in a similar economic environment. Accordingly, KfW determines the incremental borrowing rate of the basis of the refinancing rate it uses for its own issues.

KfW applies IAS 36 “Impairment of Assets” to rights of use to determine whether the right of use is impaired and to recognise any impairment loss identified. Depreciation, amortisation and impairments of rights of use are reported in Administrative expense. Interest expense from discounting the rights of use and the interest compounded on lease liabilities are included in Other interest expense.

The only minimal effects on net assets, financial and earnings position arise exclusively from the “leasing buildings” class.

For short-term leases with a maximum term of 12 months and leases in which the underlying asset is of low value, KfW utilises the relief provided for in IFRS 16.5 and does not recognise a right of use.

The small number of contracts in which KfW Group acts as a lessor are classified as operating leases. The leased asset is recognised under Property, plant and equipment and the corresponding rental income in Other operating income.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Accounting policies

(17) Intangible assets

Under Intangible assets, KfW Group reports purchased and internally generated software at cost, less straight-line amortisation and impairments, both recognised in Administrative expense. The useful life is determined based on expected wear and tear. KfW Group assumes a useful life of five years.

Assets are impaired when the carrying amount of an asset exceeds the recoverable amount. An impairment is recorded when no future economic benefits can be identified.

Internally generated software under development is reported under Other intangible assets and is not subject to amortisation.

(18) Risk provisions

Provisions include provisions for pensions and similar commitments, credit risks, interest rate reductions in irrevocable loan commitments granted by KfW in the promotional lending business and negatively impacting its earnings position, as well as other obligations of uncertain amount and timing involving a probable outflow of funds.

The employees of the group participate in a company pension plan that pays retirement, long-term disability and survivor benefits. KfW Group has various pension plans, consisting exclusively of defined-benefit schemes. The benefits largely depend on the length of company service and salary. The pension plan that was applied for new hires until 1985 offered a full pension (Gesamtversorgung), in which a certain portion of the income paid before the benefits were due was allocated as a benefit after deducting the state pension. Apart from employer-financed pension plans there are also plans in place involving contributions by employees.

KfW Group pension plans are subject to the following risks in particular: longevity, interest rate fluctuation, pension adjustment risk as well as the risk of future changes to the assessment bases.

Longevity risk is the risk that higher expenses will be incurred for the company pension plan if the pensioners live longer than projected. In general, this risk is balanced out across all pensioners and would only have an impact if life expectancy were to rise faster in the future than anticipated.

Due to the long term of the company pension plan, provisions for pension obligations are subject to general interest rate fluctuation risks.

Pension adjustment risk largely relates to the pension plan offering a full pension (Gesamtversorgung). In this scheme, benefits are recalculated as soon as there is a change in the base income eligible for pension or the state pension to be offset. Another pension plan must be examined regularly in terms of forecast and actual pension adjustments, undertaking such adjustments if necessary.

The amount of the benefits promised under the existing pension plans in the group depends, among other things, on development of the income eligible for benefits and the social security contribution ceiling (Beitragsbemessungsgrenze). There is a risk that the basis of assessment will develop differently than was assumed.

Pension obligations are calculated by an independent qualified actuary in accordance with the projected unit credit method on the basis of group-wide uniform parameters such as age, length of company service and salary. The pension provision is recognised at the present value of the defined-benefit obligations as of the reporting date. The discount factor is based on current market conditions for a portfolio of high-quality corporate bonds/bonds from supranational issuers with a maturity matching that of the obligations. The definition of the portfolio takes into account current market conditions. Additional demographic factors (including the 2018 G Heubeck actuarial tables) and actuarial assumptions (rate of salary and pension increases, rate of staff turnover, etc.) are taken into account.

KfW Financial Report 2024

No plan assets were defined for the pension obligations of the group, so the related special accounting rules do not apply. Provisions for pensions and similar obligations are financed in‐house with assets with corresponding maturities.

Actuarial gains and losses are immediately recognised at the time they occur. They occur as a result of remeasurement of pension obligations as of the reporting date compared to the figures forecast at the beginning of the year.

Additions to pension provisions distinguish between service cost and interest expense. Service cost is reported under Administrative expense; interest expense is reported under Other interest expense. The pension provision changes recognised directly in equity comprise the actuarial gains and losses reported in Revaluation reserves; these are reported in Other comprehensive income.

Pension‐like obligations include commitments for deferred compensation, early retirement and partial retirement. Actuarial reports are prepared and a provision is recognised accordingly for these types of commitments as well. No actuarial gains or losses are incurred.

Other provisions, including those for obligations to employees and for audit and consultancy services, are recognised at the estimated expenditure. Long‐term provisions are discounted where the effect is material. Added to this are obligations arising from the assumption of the tasks of the State Insurance Company of the German Democratic Republic in liquidation (Staatliche Versicherung der Deutschen Demokratischen Republik in Abwicklung -- “SinA” institution under public law), which are offset by receivables in the same amount from the Federal Agency for Special Tasks Associated with Unification (Bundesanstalt für vereinigungsbedingte Sonderaufgaben -- “BvS”) reported under Other assets. If the provision is not required in full or if the reason for creating the provision no longer applies, the provision is reversed via the same income statement item that was used in creating the provision.

(19) Income tax assets and liabilities

Income taxes are accounted for and measured in accordance with IAS 12. Current and deferred income tax assets are reported in the item Income tax assets; current and deferred income tax liabilities under Income tax liabilities. Current income tax assets and liabilities are recognised in the amount expected to be returned or paid in the future.

The tax rates applicable are those in effect on the reporting date or those that can be assumed with sufficient certainty to be in effect on the reporting date. KfW itself is exempt from income taxes pursuant to Section 5 (1) no. 2 of the German Corporation Tax Act (Körperschaftsteuergesetz -- “KStG”) and Section 3 no. 2 of the German Trade Tax Act (Gewerbesteuergesetz -- “GewStG”).

Deferred income tax assets and liabilities are generally recognised on temporary differences between the carrying amounts of assets and liabilities in accordance with IFRS and the corresponding tax value. Deferred tax assets are only recognised for temporary differences from items and for unused tax loss carryforwards if their realisation is sufficiently probable; the impairment test is carried out on the basis of group business sector planning for each group company. Deferred taxes are measured at the tax rates expected at the time of realisation of the deferred taxes. The tax rates used are those in force or that have been announced as of the reporting date. Deferred income tax assets and liabilities are offset on the assumption that they relate to the same taxable entity, the same tax type and the same tax authority.

If temporary differences have arisen from a transaction recognised directly in equity, the resulting deferred income tax assets and liabilities are also recognised directly in equity. Income from and expenses for current and deferred income taxes is recognised in the consolidated income statement under Income taxes.

Financial Report > Consolidated financial statements > Consolidated notes - Accounting policies

(20) Equity

The equity structure is determined, in particular, by the KfW Law and the requirements of IFRS.

Pursuant to Article 10 (2) and (3) of the KfW Law, KfW's net income for the period determined in accordance with the German Commercial Code is transferred to reserves and is included in equity under IFRS.

KfW Group reports a fund for general banking risks in equity. Additions to or reductions of the fund are presented in accordance with IFRS as an addition to or reduction of retained earnings.

Under IFRS, any remaining consolidated net income is allocated to Other retained earnings in the same period.

Revaluation reserves comprise transactions to be recognised directly in equity in accordance with IFRS. These include valuation results from the change in own credit risk of liabilities measured at fair value through profit or loss and from defined benefit pension obligations. They also may include deferred taxes, depending on the underlying transaction.

(21) Trust activities

Assets and liabilities held by KfW Group in its own name but for the account of third parties are not recognised if the trustor retains all risks and opportunities. At KfW, this applies in particular to loans and equity investments made by KfW on behalf of the Federal Government. Both opportunities and risks remain with the Federal Government in such transactions.

Fees from trust activities are recognised under Commission income.

Further information can be found in the note "Financial instruments" in section "A. Classification and measurement" in the comments on mandated transactions.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

Notes to the consolidated statement of comprehensive income

(22) Net interest income

Analysis of Net interest income

	2024	2023
	EUR in millions	EUR in millions
Interest and similar income from loans and advances to banks and customers	10,358	8,806
Similar income from off-balance sheet transactions	38	33
Interest income from securities and investments	703	454
Interest income from hedges recognised in the statement of financial position	7,464	6,409
Other interest income	1,568	1,598
Interest income from the effective interest method	20,132	17,300
Interest and similar income from loans and advances to banks and customers	343	329
Interest income from securities and investments	86	85
Interest income from Other derivatives	619	685
Other interest income	1,049	1,099
Interest income, total	21,181	18,399
Interest and similar expense for liabilities to banks and customers	795	1,157
Interest expense for certificated liabilities	8,969	6,623
Interest expense from hedges recognised in the statement of financial position	7,653	7,078
Interest expense from Other derivatives	518	417
Other interest expense	754	667
Interest expense, total	18,689	15,943
Net interest income	2,493	2,456

Expenses for granting promotional loans below market rates – due to additional promotional funds in the form of interest rate reductions with an impact on KfW's earnings position – amount to EUR 408 million (2023: EUR 282 million) and are reported in Other interest expense. In addition to the charges resulting from the present value of the nominal scheduled interest rate reductions in new lending business, the Other interest expense item also comprises the expenses arising from amortisation at a constant effective interest rate. Interest and similar income from loans and advances to banks and customers also comprises income from accrual-based amortisation in the amount of the pro-rata nominal planned interest rate reductions for these promotional loans in the amount of EUR 211 million (2023: EUR 189 million).

Interest income resulting from balances with central banks in the amount of EUR 1,565 million (2023: EUR 1,596 million) is reported under Other interest income from the effective interest method.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

Interest income from stage 3 loan receivables in the amount of EUR 63 million (2023: EUR 63 million) is reported under Interest and similar income from loans and advances to banks and customers.

Interest income from hedges recognised in the statement of financial position comprises interest income from derivatives designated for hedge accounting as well as interest income from amortisation of value adjustments from hedge accounting. Interest income or interest expense from derivatives designated for hedge accounting is recognised depending on the related hedged item in the interest income or interest expense from hedges recognised in the statement of financial position for related financial assets or liabilities. Including the interest income or expense from the hedged items and derivatives in hedge accounting means that presentation is based on the economic substance of the hedged financial assets (floating rate financial assets) or hedged financial liabilities (floating rate financial liabilities).

Gross analysis of negative interest contributions

	2024	2023
	EUR in millions	EUR in millions
Interest income, total	21,181	18,399
Negative interest from the lending business	49	60
Interest income from the deposit-taking business	252	303
Interest income (gross)	21,482	18,763
Interest expense, total	18,689	15,943
Negative interest from the deposit-taking business	252	303
Interest expense from the lending business	49	60
Interest expense (gross)	18,989	16,307

The negative interest contributions included in Interest income resulted from loans and advances to banks, loans and advances to customers, and securities and investments.

The positive interest contributions in Interest expense are largely due to liabilities to banks and liabilities to customers and certificated liabilities.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

(23) Net gains/losses from risk provisions

Analysis of Risk provisions by transaction

	2024	2023
	EUR in millions	EUR in millions
Expenses for risk provisions for lending business (Loans and advances to banks/customers and off-balance sheet lending transactions)	781	905
Expenses for additions to risk provisions	730	873
Direct write-offs	51	32
Expenses for risk provisions for securities and investments	11	4
Expenses for additions to risk provisions	11	4
Expenses for risk provisions	792	910
Income from risk provisions for lending business (Loans and advances to banks/customers and off-balance sheet lending transactions)	832	1,063
Income from the reversal of risk provisions	789	998
Income from recoveries of amounts previously written off	43	66
Income from risk provisions for securities and investments	11	8
Income from the reversal of risk provisions	11	8
Income from risk provisions	843	1,072
Net gains/losses from non-substantial contractual modifications	-4	-1
Other risk provisions for lending business	-8	8
Total	39	169

(24) Net commission income

Analysis of Commission income

	2024	2023
	EUR in millions	EUR in millions
Revenue from contracts with customers	690	610
From mandate contractual arrangements with the Federal Government^{1)}	626	539
Fee income from mandate agreements, processing activities and services	20	16
Fee income from the lending business	37	47
Other revenue from contracts with customers	7	7
Other commission income	3	12
Financial guarantee contracts	0	0
Other	3	12
Commission income, total	693	622

1) Includes commission income in the amount of EUR 68 million (2023: EUR 70 million) from mandate contractual arrangements with the Federal Government in trust activities

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of comprehensive income

Commission income by segment in financial year 2024

2024	Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	KfW Capital	Export and project finance
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Commission income	328	32	16	26
of which Federal Government	326	29	9	0
%	99%	89%	59%	0%
2024	KfW Development Bank	DEG	Financial markets	Head office
---	---	---	---	---
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Commission income	274	12	0	4
of which Federal Government	255	4	0	4
%	93%	33%	0%	81%

Commission income by segment in financial year 2023

2023	Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	KfW Capital	Export and project finance
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Commission income	254	36	13	43
of which Federal Government	251	32	6	0
%	99%	88%	48%	0%
2023	KfW Development Bank	DEG	Financial markets	Head office
---	---	---	---	---
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Commission income	260	11	0	5
of which Federal Government	245	0	0	4
%	94%	4%	0%	87%

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of comprehensive income

Out-of-period income

	2024	2023
	EUR in millions	EUR in millions
Revenue in current period resulting from services performed in the previous period(s)	26	8

Analysis of Commission expense

	2024	2023
	EUR in millions	EUR in millions
Commission expense for lending business	10	10
Other commission expense	19	18
Commission expense	30	29

(25) Net gains/losses from hedge accounting

Analysis of Net gains/losses from hedge accounting by type of hedging relationship

	Hedge ineffectiveness		Items in the income statement that contain cases of hedge ineffectiveness
	2024	2023
	EUR in millions	EUR in millions
Micro fair value hedges	-52	44	Net gains/losses from hedge accounting
Interest risk	-13	45	-
Interest-currency risk	-39	0	-
Macro fair value hedges	159	247	Net gains/losses from hedge accounting
Interest risk	159	247	-
Total	107	291	Net gains/losses from hedge accounting

Analysis of Net gains/losses from micro fair value hedge accounting by hedged item

	2024	2023
	EUR in millions	EUR in millions
Hedging of securities and investments	3	-2
Hedging of liabilities to banks and customers	-5	5
Hedging of certificated liabilities	-49	42
Subtotal: Effectiveness of hedges	-51	45
Amortisation of value adjustments	-1	0
Total	-52	44

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of comprehensive income

Gross analysis of valuation gains/losses from micro fair value hedge accounting: Comparison of hedged items and hedging instruments in financial year 2024

	Hedged items	Hedging instruments	Effectiveness of hedges
	EUR in millions	EUR in millions	EUR in millions
Hedging of securities and investments	655	-652	3
Hedging of liabilities to banks and customers	-605	600	-5
Hedging of certificated liabilities	-5,961	5,911	-50
Total	-5,911	5,858	-52

Gross analysis of valuation gains/losses from micro fair value hedge accounting: Comparison of hedged items and hedging instruments in financial year 2023

	Hedged items	Hedging instruments	Effectiveness of hedges
	EUR in millions	EUR in millions	EUR in millions
Hedging of securities and investments	1,156	-1,159	-2
Hedging of liabilities to banks and customers	-860	864	5
Hedging of certificated liabilities	-12,952	12,994	42
Total	-12,656	12,700	44

Gross analysis of net gains/losses from macro fair value hedge accounting: Comparison of hedged items and hedging instruments in financial year 2024

	Hedged items	Hedging instruments	Effectiveness of hedges
	EUR in millions	EUR in millions	EUR in millions
Valuation result	2,193	-1,526	667
Amortisation	3,209	-3,761	-552
Realisation	43	0	43
Net gains/losses from macro fair value hedge accounting	5,446	-5,287	159

Gross analysis of net gains/losses from macro fair value hedge accounting: Comparison of hedged items and hedging instruments in financial year 2023

	Hedged items	Hedging instruments	Effectiveness of hedges
	EUR in millions	EUR in millions	EUR in millions
Valuation result	6,589	-7,307	-718
Amortisation	4,465	-3,586	879
Realisation	85	0	85
Net gains/losses from macro fair value hedge accounting	11,139	-10,893	247

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

Net gains/losses from macro fair value hedge accounting comprise the valuation of hedging instruments and the valuation of hedged risks from the hedged portfolios. It also includes the amortisation of the value adjustments from the dynamic hedge designation and de-designation and the pro rata reversal of value adjustments in the event of derecognition of financial instruments from the underlying portfolios as well as the pull-to-par effect of the hedging derivatives.

(26) Net gains/losses from other financial instruments at fair value through profit or loss

Analysis of Net gains/losses from other financial instruments at fair value through profit or loss

| | 2024
EUR in millions | 2023
EUR in millions |
| --- | --- | --- |
| Loans and advances to banks/customers | 35 | 19 |
| Loans and advances | 16 | 15 |
| Miscellaneous receivables (money market transactions, promissory note loans and Other receivables) | 19 | 4 |
| Securities and investments | -6 | -38 |
| Bonds and other fixed-income securities | 0 | 0 |
| Shares and other non-fixed income securities | -28 | 0 |
| Equity investments | 23 | -37^{1)} |
| Liabilities to banks and customers | -5 | -39 |
| Certificated liabilities | 199 | -147 |
| Other derivatives | -267 | 104 |
| Financial derivatives not qualifying for hedge accounting | -267 | 104 |
| Foreign currency translation | 88 | -75 |
| Total | 44 | -177 |

1) A net gain from fund investments of EUR 48 thousand was reported in the previous year under equity investments. As of financial year 2024, net gains/losses from fund investments are reported under Net gains/losses from shares and other non-fixed income securities.

Net gains/losses from assets include the net gains/losses from holding arrangements for the Federal Republic of Germany – if attributable to KfW –, KfW IPEX-Bank's syndication business with a focus on short-term placement, loans that do not meet the SPPI criterion (loans and advances to banks and loans and advances to customers), and equity investments (securities and investments).

The gains realised from the disposal of non-current assets held for sale included in net gains/losses from securities and investments amounted to EUR 0 million in financial year 2024 (2023: EUR 6 million).

Net gains/losses from liabilities measured at fair value include the results from promissory note loans (liabilities to banks/liabilities to customers) and bonds and notes (certificated liabilities).

Net gains/losses from financial derivatives not qualifying for hedge accounting are mainly attributable to derivatives in economic hedges. Economic hedges are recognised by exercising the fair value option for the hedged items. The hedged items include, in particular, borrowings in the form of Certificated liabilities, Liabilities to banks and Liabilities to customers.

Furthermore, this line item includes gains/losses from bifurcated embedded derivatives resulting from hybrid contracts under financial liabilities. The net gains/losses from the valuation of the associated hedging derivatives are thus compensated for.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

Gross analysis of results from economically hedged borrowings:
Comparison of hedged items and hedging instruments

	2024	2023
	EUR in millions	EUR in millions
Borrowings	194	~186
Hedging instruments	~249	162
Total (effectiveness of economic hedges)	~55	~24

(27) Net gains/losses from disposal of financial assets at amortised cost

	2024	2023
	EUR in millions	EUR in millions
Income from the disposal of financial assets at amortised cost	0	0
Expense from the disposal of financial assets at amortised cost	0	0
Total	0	0

(28) Net gains/losses from investments accounted for using the equity method

	2024	2023
	EUR in millions	EUR in millions
Net gains/losses from investments accounted for using the equity method	20	29

(29) Administrative expense

Analysis of Administrative expense

	2024	2023
	EUR in millions	EUR in millions
Wages and salaries	795	722
Social security contributions	116	108
Expenses for pension provision and other employee benefits	49	43
Personnel expense	961	873
Other administrative expenses	621	596
thereof Office costs	62	63
thereof Personnel-related material costs	44	42
thereof Office operating costs	123	120
thereof Costs of external services	355	330
thereof Costs of public relations work	27	29
thereof Other material costs	10	12
Depreciation, amortisation and impairment of property, plant and equipment and intangible assets	90	92
of which impairments of rights of use arising from leases	10	9
Non-personnel expense	711	688
Total	1,672	1,561

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of comprehensive income

(30) Net other operating income or loss

Analysis of Net other operating income or loss

	2024	2023
	EUR in millions	EUR in millions
Other operating income	31	41
Other operating expense	83	117
Total	-52	-76

Other operating income primarily includes income from the reversal of other provisions in the amount of EUR 12 million (2023: EUR 17 million).

The Other operating expense item included contributions payable by KfW IPEX-Bank to the restructuring fund for banks in the amount of EUR 15 million in the previous year. As the build-up of the European resolution fund has been concluded, no further contribution was made in 2024. KfW is not obligated to contribute to the fund in accordance with Section 2 of the Restructuring Fund Act (Restrukturierungsfondsgesetz – "RStrukFG").

In addition, the obligation to award grants under KfW's ERP promotional programmes was included in the amount of EUR 70 million (previous year: EUR 62 million) in Other operating expense.

(31) Taxes on income

Analysis of Taxes on income by component

	2024	2023
	EUR in millions	EUR in millions
Current taxes on income	167	117
Deferred taxes	72	47
Total	239	165

Current taxes include taxes on income for group companies and non-deductible investment income tax recorded at the level of KfW and DEG.

The reconciliation presents the relationship between the calculated income tax expense for the financial year and reported taxes on income.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of comprehensive income

Income tax reconciliation

| | 2024
EUR in millions | 2023
EUR in millions |
| --- | --- | --- |
| Profit/loss from operating activities (before taxes) | 1,641 | 1,724 |
| Group income tax rate | 0% | 0% |
| Calculated income tax expense in the financial year | 0 | 0 |
| Effects of tax rate differentials within the group | 177 | 159 |
| Effect of tax rate changes | 36 | 0 |
| Effects of previous year taxes recorded in the reporting year | 7 | 0 |
| Effects of non-deductible taxes on income | 0 | 0 |
| Effects of non-deductible business expenses | 3 | 7 |
| Effects of tax-free income | -22 | 12 |
| Trade tax add-ons/reductions | 0 | 0 |
| Permanent accounting differences | 37 | -14 |
| Effects of changes in recognised deferred tax assets | 1 | 1 |
| Reported taxes on income/expense | 239 | 165 |
| Average effective tax rate | 15% | 10% |

KfW's applicable income tax rate of 0%, on which the reconciliation is based, takes into account the tax status of KfW as a non-taxable public-law institution and the fact that this status predominantly determines profit/loss from operating activities.

The effects of tax rate differentials result from individual group companies being taxable and the related different tax rates. The tax rates continue to range from 0% to 32%.

Global Minimum Tax ("GMT") in accordance with the OECD Pillar Two rules

KfW Group falls within the scope of the GMT pursuant to the OECD Pillar Two rules. In accordance with the German Minimum Tax Act (Mindeststeuergesetz – "MinStG"), KfW Group must pay a top-up tax per country where KfW Group entities are based, in the amount of the difference between the GloBE effective tax rate (which is equal to GloBE tax expense or income divided by GloBE profit or loss) and the minimum tax rate of 15%. The law applies for financial years beginning on or after 31 December 2023.

KfW as group parent is a state-owned promotional bank and is therefore deemed an excluded entity pursuant to Section 5 (1) no. 1 MinStG. KfW Capital GmbH & Co. KG is also excluded from the scope of the Minimum Tax Act. The remainder of the KfW enterprise group that fall(s) within the scope of the Minimum Tax Act applies the transitional safe harbour rules pursuant to Section 83 Minimum Tax Act. The group assumes that there will be no relevant tax burden as a result of the global minimum taxation law due to this transitional arrangement.

The UK has introduced a national supplementary tax as part of transposing global minimum taxation pursuant to the OECD Pillar Two rules. The group further assumes that a transitional arrangement can be made for KfW IPEX-Bank GmbH's permanent establishment in London. Singapore will not implement the national rules until 2025.

KfW Group currently expects that the DC Nordseekabel GmbH und Co. KG joint venture falls within the scope of the CbCR safe harbour according to Section 84 (1) no. 3 of the Minimum Tax Act, and that, consequently, no domestic top-up tax is triggered.

In accordance with the amendments to IAS 12 published in May 2023, the group has exercised the option of temporary exemption from recognising deferred taxes in connection with implementation of the Pillar Two rules. The group consequently reports neither deferred tax assets nor deferred tax liabilities arising under the OECD's Pillar Two income taxes.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Segment reporting

Segment reporting

(32) Segment reporting by business sector

In accordance with the provisions of IFRS 8, segment reporting follows the internal management reporting system, which is used by the group's main decision-makers to assess each segment's performance and to allocate resources to segments.

In accordance with the business sector structure for the group, the segments and their products and services can be presented as follows:

| Mittelstandsbank & Private Kunden (SME Bank & Private Clients) | - Start-up financing
- Financing of general corporate investments and investments in innovation, energy and environmental protection
- Education financing
- Financing for housing construction, conversion and refurbishment |
| --- | --- |
| Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) | - Financing of municipal and social infrastructure
- Customised corporate financing with equity and debt capital
- Customised financing of banks and promotional institutions of the federal states
- Mandated transactions for energy supply (debt capital) |
| KfW Capital | - Investments in German and European venture capital and venture debt funds |
| Export and project finance | - Financing of German and European export activities
- Financing of projects and investments which are of special interest for Germany and Europe |
| KfW Development Bank | - Promotion of developing countries and emerging economies on behalf of the Federal Government with standard loans/grants refinanced through budget funds and promotional/development loans from market funds raised by KfW |
| DEG | - Financing provided by DEG - Deutsche Investitions- und Entwicklungs-gesellschaft mbH in developing countries and emerging economies (private enterprise financing) |
| Financial markets | - Securities and money market investments
- Holding arrangements for the Federal Republic of Germany
- Transactions mandated by the Federal Government, loan granted to Greece
- Funding |
| Head office | - Central interest rate and currency management
- Strategic equity investments |

The business sectors are measured on the basis of their contribution to consolidated profit. The individual items are based on the following methods:

Net interest income (before promotional expense) comprises the net interest generated from lending business calculated on the basis of the market interest rate method¹). The item also includes the imputed return on equity allocated according to the business sectors' planned regulatory capital. Head office also includes the treasury result, which largely comprises the income/loss from maturity transformation. The profit contribution from KfW funding²) is allocated to the Financial markets business sector.
Promotional expense included in Interest, Commission and Administrative expense and Other operating expense in the income statement is reported separately pursuant to the internal management report due to the special relevance of promotional expense as a management variable.

¹) Funding at matching maturities using KfW's internal refinancing curve is assumed for the calculation of net interest income in this method.
²) The difference between the realised refinancing rates and the maturity-matched refinancing rates calculated in-house.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Segment reporting

Promotional expense is understood to mean certain expenses from the two business sectors Mittelstandsbank & Private Kunden (SME Bank & Private Clients) and Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) that have a positive impact on the achievement of KfW's promotional objectives. Promotional expense primarily consists of additions of the interest rate reductions accounted for at present value³⁾ from new commitments as well as from the compounding effect. Additional promotional components are the expenses for upfront fees paid to sales partners for the processing of small and micro loans (included in Commission expense), for innovative digital promotional approaches (included in Commission and Administrative expense), for available and product-related marketing and sales measures (included in Administrative expense), and, from 2023, for promotional grants awarded by KfW under ERP promotion (included in Other operating expense).

The allocation of Administrative expense (before promotional expense) is based on the results from activity-based accounting by cost centres⁴⁾. Administrative expense (before promotional expense) includes depreciation on property, plant and equipment and amortisation of intangible assets and rights of use.
In the Risk provisions for lending business item, net impairment charges, direct write-offs, recoveries on loans written off and the net gains/losses from non-substantial contractual modifications are distributed among the segments according to the underlying loan.
The valuation result (before promotional expense) comprises the net gains/losses from hedge accounting, the net gains/losses from other financial instruments at fair value, net gains/losses from risk provisions in the securities business, the net gains/losses from the disposal of financial instruments measured at amortised cost, the net gains/losses from investments accounted for using the equity method and net other operating income (before promotional expense).
When taxes on income are allocated to the business sectors (excluding the Head office), only the current taxes on income are taken into account. Deferred taxes are allocated to the Head office.
In accordance with the internal management reporting system, segment assets are not reported as they are used neither to assess each segment's performance nor to allocate resources to segments.
The presentation of segment income and expense is based on consolidated figures. Administrative and commission expense as well as commission income and other operating income resulting from service relationships within KfW Group are adjusted in segment reporting. Any remaining negligible consolidation effects are reported in the reconciliation/consolidation column.

KfW Financial Report 2024

³⁾ See Note 12 for details on KfW's interest rate reductions in the promotional lending business.
⁴⁾ The costs incurred in the organisational units are largely allocated to the products by means of core services.

Financial Report > Consolidated financial statements > Consolidated notes – Segment reporting

Segment reporting by business sector for financial year 2024

	Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	KfW Capital¹⁾	Export and project finance¹⁾	KfW Development Bank¹⁾
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Volume of new commitments	35,816	41,570	1,590	23,916	7,839
Net interest income (before promotional expense)	531	108	-22	1,012	202
Net commission income (before promotional expense)	327	32	16	26	274
Administrative expense (before promotional expense)	462	87	27	321	436
Operating result before valuation (before promotional expense)	397	53	-32	717	40
Risk provisions for lending business	-56	0	0	28	12
Valuation result (before promotional expense)	0	1	31	16	20
Profit/loss from operating activities (before promotional expense)	341	54	-2	761	73
Promotional expense	477	26	0	0	0
Taxes on income	0	0	1	150	0
Consolidated profit	-136	28	-2	611	73
	DEG	Financial markets	Head office	Reconciliation/ consolidation	KfW Group
---	---	---	---	---	---
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Volume of new commitments	2,470	0	0	-369	112,831
Net interest income (before promotional expense)	136	478	454	0	2,900
Net commission income (before promotional expense)	1	-5	4	0	675
Administrative expense (before promotional expense)	153	99	73	0	1,658
Operating result before valuation (before promotional expense)	-17	375	385	0	1,917
Risk provisions for lending business	58	-4	0	0	39
Valuation result (before promotional expense)	3	13	103	0	188
Profit/loss from operating activities (before promotional expense)	44	384	488	0	2,145
Promotional expense	0	0	0	0	504
Taxes on income	16	0	72	0	239
Consolidated profit	29	384	416	0	1,402

¹⁾ The valuation result of the business sectors includes the following net gains/losses from investments accounted for using the equity method: KfW Capital EUR -1.9 million, Export and project finance EUR 14.2 million and KfW Development Bank EUR 7.3 million.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Segment reporting

Segment reporting by business sector for financial year 2023

	Mittelstandsbank & Private Kunden (SME Bank & Private Clients)	Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients)	KfW Capital¹⁾	Export and project finance¹⁾	KfW Development Bank¹⁾
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Volume of new commitments	39,117	35,852	2,129	24,152	9,040
Net interest income (before promotional expense)	578	165	1	915	202
Net commission income (before promotional expense)	253	37	12	42	260
Administrative expense (before promotional expense)	422	81	21	298	418
Operating result before valuation (before promotional expense)	409	120	-7	660	44
Risk provisions for lending business	49	5	0	-11	15
Valuation result (before promotional expense)	0	-9	-92	-23	70
Profit/loss from operating activities (before promotional expense)	458	116	-99	626	129
Promotional expense	358	14	0	0	0
Taxes on income	0	0	1	86	0
Consolidated profit	100	102	-100	540	129
	DEG	Financial markets	Head office	Reconciliation/ consolidation	KfW Group
---	---	---	---	---	---
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Volume of new commitments	1,869	480	0	-1,327	111,312
Net interest income (before promotional expense)	155	447	275	0	2,738
Net commission income (before promotional expense)	3	-5	3	0	606
Administrative expense (before promotional expense)	144	94	70	0	1,547
Operating result before valuation (before promotional expense)	14	349	209	0	1,797
Risk provisions for lending business	110	-3	0	0	165
Valuation result (before promotional expense)	-42	15	215	0	134
Profit/loss from operating activities (before promotional expense)	82	360	423	0	2,095
Promotional expense	0	0	0	0	371
Taxes on income	31	0	48	0	165
Consolidated profit	51	360	376	0	1,559

¹⁾ The valuation result of the business sectors includes the following net gains/losses from investments accounted for using the equity method: KfW Capital EUR 0.7 million, Export and project finance EUR 18.2 million and KfW Development Bank EUR 10.2 million.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Segment reporting

The reconciliation/consolidation column includes all adjustments that were necessary to reconcile segment information with the aggregated information for the group. The consolidation effects reported for “Volume of new commitments” relate to commitments for programme loans made by Mittelstandsbank & Private Kunden (SME Bank & Private Clients) and Individualfinanzierung & Öffentliche Kunden (Customised Finance & Public Clients) for which KfW IPEX-Bank acts as on-lending bank. The other amounts in this column result from minimal consolidation effects.

(33) Segment reporting by region

Net interest and commission income are allocated on the basis of the customers' geographical location. The imputed return on equity included in net interest income, the profit contribution from KfW funding and the treasury result are allocated to Germany. KfW receives commission income from the Federal Government for supporting developing countries and emerging economies using budget funds of the Federal Government. These funds are allocated according to the region of the country receiving the investment.

Property, plant and equipment and intangible assets are not reported according to region because, apart from immaterial amounts, these assets relate to Germany.

Segment reporting by region for financial year 2024

	Germany	Europe (excl. Germany)	Rest of the world	Reconciliation/ consolidation	KfW Group
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Net interest income	1,360	524	609	0	2,493
Net commission income	370	39	254	0	664
Segment income	1,730	563	863	0	3,156

Segment reporting by region for financial year 2023

	Germany	Europe (excl. Germany)	Rest of the world	Reconciliation/ consolidation	KfW Group
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Net interest income	1,360	457	639	0	2,456
Net commission income	297	47	249	0	593
Segment income	1,657	504	888	0	3,049

The reconciliation/consolidation column includes all adjustments that were necessary to reconcile segment information with the aggregated information for the group. The amounts in this column result solely from minimal consolidation effects.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Notes to the consolidated statement of financial position

(34) Cash reserves

Analysis of Cash reserves

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Cash	0	0
Balances with central banks	26,522	47,430
Total	26,522	47,431

(35) Financial assets at amortised cost

Analysis of Financial assets at amortised cost by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Loans and advances to banks
Money-market transactions	16,499	14,353
Loans and advances	291,690	299,388
Other receivables	12,339	10,901
Loans and advances to customers
Money-market transactions	500	270
Loans and advances	141,993	140,705
Promissory note loans	1,989	1,611
Other receivables	1,492	1,742
Securities and investments
Bonds and other fixed-income securities	37,991	36,065
Total gross	504,492	505,035
less risk provisions for
Loans and advances to banks	-122	-167
Loans and advances to customers	-1,696	-1,685
Securities and investments	-8	-8
Total net	502,666	503,175

The receivables from reverse repurchase agreements (reverse "repos") are included in Loans and advances to banks – Other receivables.

The cash collateral pledged of EUR 2,469 million (31 Dec. 2023: EUR 5,260 million) is attributable to cash collateral on derivatives and included in Loans and advances to banks – Other receivables and Loans and advances to customers – Other receivables.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Analysis of Loans and advances by underwriting liability type

	Loans and advances to banks		Loans and advances to customers
	31 Dec. 2024	31 Dec. 2023	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Direct loans	68,919	70,221	132,812	130,092
On-lent customer loans with full underwriting borne by the on-lending commercial bank	209,116	209,573	0	0
On-lent customer loans with partial underwriting borne by the on-lending commercial bank	14,248	20,001	0	0
On-lent customer loans without underwriting borne by the on-lending commercial bank	0	0	5,159	6,650
Direct customer loans with full underwriting borne by the on-lending commercial bank	0	0	3,074	2,947
Direct and on-lent subordinated loans	314	356	983	1,054
Adjustment to the carrying amount due to the interest rate being below the market rate for promotional loans paid out with additional promotional funds in the form of interest rate reductions with an impact on KfW's earnings position.	-907	-762	-33	-37
Total	291,690	299,388	141,993	140,705

Direct loans to banks include in particular global loans granted as part of financing for domestic housing construction and SMEs.

Direct loans to customers include in particular loans granted under export and project financing, municipal financing and education financing. The item also includes loans connected with certain transactions mandated by the Federal Government in accordance with the KfW Law.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of financial position

(36) Gross carrying amounts

Development of gross carrying amounts of financial assets at amortised cost – Loans and advances to banks

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	321,416	2,098	1,128	324,642	310,314	2,836	1,018	314,168
Transfer from stage 2 and stage 3 to stage 1	657	-656	-1	0	715	-714	-1	0
Transfer from stage 1 and stage 3 to stage 2	-503	531	-27	0	-986	1,001	-16	0
Transfer from stage 1 and stage 2 to stage 3	-665	-208	873	0	-633	-260	893	0
Additions – New business and increased utilisation	123,210	29	68	123,307	108,196	54	12	108,263
Disposals	-126,710	-578	-769	-128,056	-93,852	-821	-756	-95,429
of which financial assets written off	-126,710	-578	-713	-128,000	-93,852	-821	-743	-95,416
of which default on receivables	0	0	-56	-56	0	0	-13	-13
Changes from non-substantial contractual modification	0	0	0	0	0	1	0	1
Exchange rate and other changes	704	7	-77	635	-2,339	1	-23	-2,361
As of 31 Dec.	318,108	1,223	1,196	320,527	321,416	2,098	1,128	324,642

Development of gross carrying amounts of financial assets at amortised cost – Loans and advances to customers

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	134,370	5,252	4,707	144,328	140,311	8,827	5,339	154,478
Transfer from stage 2 and stage 3 to stage 1	1,778	-1,774	-5	0	3,819	-3,819	0	0
Transfer from stage 1 and stage 3 to stage 2	-1,567	1,666	-98	0	-2,712	2,799	-87	0
Transfer from stage 1 and stage 2 to stage 3	-864	-305	1,169	0	-724	-554	1,278	0
Additions – New business and increased utilisation	36,386	271	41	36,698	33,599	474	63	34,137
Disposals	-33,541	-1,500	-1,386	-36,428	-41,467	-2,401	-1,808	-45,676
of which financial assets written off	-33,541	-1,499	-1,251	-36,291	-41,467	-2,400	-1,664	-45,531
of which default on receivables	0	-1	-135	-137	-1	0	-144	-145
Changes from non-substantial contractual modification	-4	0	0	-4	-1	0	-2	-4
Exchange rate and other changes	1,509	104	-234	1,379	1,544	-74	-76	1,394
As of 31 Dec.	138,066	3,714	4,193	145,974	134,370	5,252	4,707	144,328

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of financial position

Development of gross carrying amounts of financial assets at amortised cost – Securities and investments

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	36,001	64	0	36,065	33,725	8	0	33,733
Transfer from stage 2 and stage 3 to stage 1	65	-65	0	0	7	-7	0	0
Transfer from stage 1 and stage 3 to stage 2	-84	84	0	0	-117	117	0	0
Additions – New business and increased utilisation	33,632	0	0	33,632	25,942	0	0	25,942
Disposals	-32,406	-1	0	-32,407	-24,653	-51	0	-24,704
of which financial assets written off	-32,406	-1	0	-32,407	-24,653	-51	0	-24,704
Exchange rate and other changes	700	1	0	701	1,096	-2	0	1,093
As of 31 Dec.	37,907	83	0	37,991	36,001	64	0	36,065

Development of gross carrying amounts of off-balance sheet lending transactions

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	137,227	1,847	455	139,528	129,693	2,777	532	133,002
Transfer from stage 2 and stage 3 to stage 1	14	-14	0	0	40	-40	0	0
Transfer from stage 1 and stage 3 to stage 2	-390	390	0	0	-63	64	-1	0
Transfer from stage 1 and stage 2 to stage 3	-50	0	50	0	-5	-1	6	0
Additions – New business and increased utilisation	65,955	448	9	66,412	66,223	147	134	66,503
Disposals	-62,261	-1,349	-231	-63,842	-58,633	-1,097	-211	-59,941
Exchange rate and other changes	-18	0	0	-18	-28	-3	-5	-36
As of 31 Dec.	140,475	1,322	283	142,081	137,227	1,847	455	139,528

The gross carrying amount of financial assets for which risk provisioning at the time of modification was assigned to stage 2 or 3 and was transferred back to stage 1 during the reporting period amounted to EUR 103 million as of the reporting date (31 Dec. 2023: EUR 1,083 million).

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of financial position

(37) Risk provisions

Development of risk provisions for financial assets at amortised cost – Loans and advances to banks

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	52	32	84	167	81	40	128	248
Transfer from stage 2 and stage 3 to stage 1	14	-14	0	0	13	-13	0	0
Transfer from stage 1 and stage 3 to stage 2	0	0	0	0	-5	6	-1	0
Transfer from stage 1 and stage 2 to stage 3	0	-3	3	0	0	-3	4	0
Additions	27	27	14	68	22	20	11	54
Utilisation	0	0	-49	-49	0	0	-9	-9
Reversals	-49	-18	-24	-92	-54	-17	-11	-83
Net present value effect	0	0	4	4	0	0	5	5
Exchange rate and other changes	1	0	21	22	-4	0	-43	-48
As of 31 Dec.	45	24	52	122	52	32	84	167

Development of risk provisions for financial assets at amortised cost – Loans and advances to customers

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	162	300	1,223	1,685	237	406	1,211	1,853
Transfer from stage 2 and stage 3 to stage 1	62	-62	0	0	128	-127	0	0
Transfer from stage 1 and stage 3 to stage 2	-7	23	-16	0	-34	54	-20	0
Transfer from stage 1 and stage 2 to stage 3	-8	-24	31	0	-6	-81	87	0
Additions	169	133	271	573	132	243	330	705
Utilisation	0	0	-93	-93	0	0	-197	-197
Reversals	-188	-146	-258	-593	-296	-190	-291	-776
Net present value effect	0	0	95	95	0	0	89	89
Exchange rate and other changes	3	4	22	29	2	-4	13	10
As of 31 Dec.	192	229	1,276	1,696	162	300	1,223	1,685

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of financial position

Development of risk provisions for financial assets at amortised cost – Securities and investments

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	8	0	0	8	11	1	0	12
Transfer from stage 2 and stage 3 to stage 1	6	-6	0	0	1	-1	0	0
Additions	5	6	0	11	4	1	0	4
Reversals	-10	-1	0	-11	-8	0	0	-8
As of 31 Dec.	8	0	0	8	8	0	0	8

Development of Risk provisions for lending business (off-balance sheet lending transactions)

	Financial year 2024				Financial year 2023
	Stage 1	Stage 2	Stage 3	Total	Stage 1	Stage 2	Stage 3	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan.	24	16	50	90	42	26	47	115
Transfer from stage 2 and stage 3 to stage 1	2	-2	0	0	9	-9	0	0
Transfer from stage 1 and stage 3 to stage 2	-1	1	0	0	-2	2	0	0
Transfer from stage 1 and stage 2 to stage 3	0	0	0	0	0	-3	3	0
Additions	28	14	47	89	44	31	40	115
Reversals	-36	-19	-50	-105	-68	-31	-39	-138
Exchange rate and other changes	0	0	0	1	-1	0	-2	-2
As of 31 Dec.	17	9	48	74	24	16	50	90

The post-model adjustment for the greater forecast uncertainty regarding global economic development particularly due to geopolitical crises and the threat of trade conflicts amounted to EUR 100 million as of the reporting date (31 Dec. 2023: EUR 52 million).

Provisions for losses on loans and advances also include money market investments and reverse repos.

In the reporting year, EUR 100 million (2023: EUR 95 million) in interest income was not collected for impaired loans and advances.

The contractual balance outstanding of financial assets that were written off during the reporting period and that are still subject to enforcement measures amounted to EUR 98 million as of the reporting date (31 Dec. 2023: EUR 76 million).

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(38) Financial assets at fair value

Analysis of Financial assets at fair value by class

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Loans and advances to banks – FVM | | |
| Loans and advances | 0 | 0 |
| Other receivables | 58 | 41 |
| Loans and advances to customers – FVM | | |
| Loans and advances | 8,232 | 9,927 |
| Other receivables | 0 | 1 |
| Securities and investments – FVM | | |
| Bonds and other fixed-income securities | 0 | 0 |
| Shares and other non-fixed income securities | 3,919 | 0 |
| Equity investments | 1,112 | 4,418^{1)} |
| Shares in non-consolidated subsidiaries | 92 | 90 |
| Other derivatives – FVM | | |
| Interest-related derivatives | 1,357 | 1,630 |
| Cross-currency derivatives | 947 | 692 |
| Total | 15,716 | 16,799 |

1) Fund investments of EUR 3,362 thousand were reported the previous year under equity investments. As of financial year 2024, fund investments are reported under shares and other non-fixed income securities.

Cross-currency swaps are presented under Cross-currency derivatives.

Other derivatives include derivatives with positive fair values of EUR 87 million (31 Dec. 2023: EUR 106 million) attributable to embedded derivatives that are bifurcated.

(39) Value adjustments from macro fair value hedge accounting

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Value adjustments to assets under macro fair value hedge accounting | -9,375 | -14,771 |

The fair values attributable to hedged risks in the hedged portfolios in the at amortised cost measurement category are included in this item.

(40) Derivatives designated for hedge accounting

Analysis of derivatives with positive fair values designated for hedge accounting by type of hedging relationship

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Micro fair value hedge accounting | 6,572 | 3,980 |
| Macro fair value hedge accounting | 873 | 1,463 |
| Total | 7,445 | 5,443 |

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Analysis of derivatives with positive fair values designated for hedge accounting by type of hedging instrument

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Interest-related derivatives	1,529	2,326
Cross-currency derivatives	5,916	3,118
Total	7,445	5,443

Only Interest-related derivatives are designated for macro fair value hedge accounting. Cross-currency swaps are presented under Cross-currency derivatives.

(41) Investments accounted for using the equity method

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Investments accounted for using the equity method	500	626
Total	500	626

The note regarding "Disclosures on shareholdings" includes a list of Investments accounted for using the equity method.

(42) Non-current assets held for sale

This item from the statement of financial position contains equity investments of DEG with a fair value of EUR 37 million (31 Dec. 2023: EUR 78 million) in companies in Asia and Latin America, which meet the criteria under IFRS 5 as "non-current assets held for sale", and are therefore to be reported separately. These equity investments are recognised in the business sector DEG.

Disposal of the equity investments within the next twelve months is highly likely.

It was not possible in 2024 to sell, as planned, two equity investments recognised as assets held for sale in the consolidated financial statements as of 31 December 2023 (31 Dec. 2022: four equity investments). In one case this is due to delays in the selling process. As the sale is planned for the beginning of 2025, the relevant investment is still reported under non-current assets held for sale. In the second case, there was no sale due to deterioration of the market environment. For purely accounting purposes, the investment was reclassified to the statement of financial position item Financial assets at fair value, due to the lower probability of realisation. The reclassification had no effect on the earnings position.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(43) Property, plant and equipment

Analysis of Property, plant and equipment by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Land and buildings	818	828
Plant and equipment	65	67
Rights of use arising from leases	29	31
Other property, plant and equipment	10	4
Total	922	929

Additions to rights of use arising from leases amounted to EUR 4 million (2023: EUR 1 million). Payments in advance and assets under construction are presented in Other property, plant and equipment.

Development of Property, plant and equipment in financial year 2024

	Acquisition/production cost	Accumulated amortisation, impairment and reversal of impairment losses	Net carrying amount
	EUR in millions	EUR in millions	EUR in millions
Carrying amount as of 1 Jan. 2024	1,533	-604	929
Additions/reversals of impairment losses	70	-2	68
Disposals	-109	92	-17
Amortisation	0	-57	-57
Impairment losses	0	0	0
Carrying amount as of 31 Dec. 2024	1,493	-571	922

Development of Property, plant and equipment in financial year 2023

	Acquisition/production cost	Accumulated amortisation, impairment and reversal of impairment losses	Net carrying amount
	EUR in millions	EUR in millions	EUR in millions
Carrying amount as of 1 Jan. 2023	1,496	-568	929
Additions/reversals of impairment losses	58	0	58
Disposals	-22	20	-2
Amortisation	0	-55	-55
Impairment losses	0	-1	-1
Carrying amount as of 31 Dec. 2023	1,533	-604	929

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(44) Intangible assets

Analysis of Intangible assets by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Software	60	75
Purchased software	24	31
Internally generated software	36	44
Other intangible assets	8	7
Total	69	82

Other intangible assets include, in particular, software under development.

Development of Intangible assets in financial year 2024

	Acquisition/production cost	Accumulated amortisation, impairment and reversal of impairment losses	Net carrying amount
	EUR in millions	EUR in millions	EUR in millions
Carrying amount as of 1 Jan. 2024	473	-391	82
Additions/reversals of impairment losses	19	0	19
Disposals	-33	33	0
Amortisation	0	-33	-33
Impairment losses	0	0	0
Carrying amount as of 31 Dec. 2024	459	-391	69

Development of Intangible assets in financial year 2023

	Acquisition/production cost	Accumulated amortisation, impairment and reversal of impairment losses	Net carrying amount
	EUR in millions	EUR in millions	EUR in millions
Carrying amount as of 1 Jan. 2023	457	-357	100
Additions/reversals of impairment losses	18	0	18
Disposals	-2	2	0
Amortisation	0	-36	-36
Impairment losses	0	0	0
Carrying amount as of 31 Dec. 2023	473	-391	82

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(45) Income tax assets

Analysis of Income tax assets

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Current income tax assets	23	15
Deferred income tax assets	86	161
Total	109	176

Current income tax assets result from creditable taxes (investment income tax/solidarity surcharge) and tax receivables from advance tax payments of the taxable group subsidiaries during financial year 2024 and previous years.

Deferred income tax assets mostly result from valuation differences relating to the statement of financial position items listed below and to loss carryforwards. The amount of deferred tax assets relating to loss carryforwards is based on a corresponding forecast of future income. As of 31 December 2024, the volume of deferred tax assets not recognised was EUR 8 million (31 Dec. 2023: EUR 4 million) relating to loss carryforwards, and EUR 0 million (31 Dec. 2023: EUR 0 million) relating to accounting issues.

Further information on the amount recognised directly in equity as deferred taxes under Revaluation reserves can be found in the note on "Equity".

Composition of deferred tax assets by statement of financial position item

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Financial assets at amortised cost	52	76
Financial assets at fair value	2	3
Financial liabilities at amortised cost	0	1
Financial liabilities at fair value	2	2
Provisions	31	42
Other statement of financial position items	1	0
Tax loss carryforwards	4	41
Subtotal	92	165
Offset against deferred tax liabilities	6	4
Total	86	161

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(46) Other assets

Analysis of Other assets

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Other assets and receivables	696	723
Prepaid expenses	57	49
Total	754	772

Other assets and receivables includes primarily the receivables from the Federal Agency for Special Tasks Associated with Unification (Bundesanstalt für vereinigungsbedingte Sonderaufgaben – “BvS”) amounting to EUR 634 million (31 Dec. 2023: EUR 633 million), which are offset in equal amount by provisions arising from the assumption of the operations of the State Insurance Company of the German Democratic Republic in liquidation (Staatliche Versicherung der Deutschen Demokratischen Republik in Abwicklung – “SinA”, an institution under public law).

Development of assets from contractual rights

	2024	2023
	EUR in millions	EUR in millions
As of 1 Jan.	0	0
Additions	0	0
Disposals	0	0
As of 31 Dec.	0	0

(47) Financial liabilities at amortised cost

Analysis of Financial liabilities at amortised cost by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Liabilities to banks
Money-market transactions	982	2,104
Promissory note loans	1,087	1,123
Other financial liabilities	4,393	2,549
Liabilities to customers
Money-market transactions	471	975
Promissory note loans	23,964	38,027
Other financial liabilities	5,654	9,288
Certificated liabilities
Money-market issues	32,494	37,694
Bonds and notes	416,457	407,940
Total	485,502	499,700

Liabilities from cash collateral received are included in Other financial liabilities. These are attributable to cash collateral on derivatives in the amount of EUR 3,339 million (31 Dec. 2023: EUR 1,549 million), and to cash collateral on other transactions in the amount of EUR 1,148 million (31 Dec. 2023: EUR 1,324 million).

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

New securities (money market issues, bonds and notes) under the sub-item certificated liabilities, with a nominal volume of EUR 157.6 billion and which are to be measured at amortised cost, were issued during the current financial year (2023: EUR 201.4 billion). The volume of repayments due to maturity during the same period amounted to EUR 167.2 billion (nominal) (2023: EUR 181.4 billion) and the volume of early repurchases to EUR 0.5 billion (nominal) (2023: EUR 0.4 billion).

Liabilities include liabilities from repurchase agreements and securities lending transactions under Other financial liabilities.

(48) Financial liabilities at fair value

Analysis of Financial liabilities at fair value by class

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Liabilities to banks – FVD | | |
| Promissory note loans | 225 | 221 |
| Liabilities to customers – FVD | | |
| Promissory note loans | 719 | 818 |
| Certificated liabilities – FVD | | |
| Bonds and notes | 6,537 | 6,613 |
| Other derivatives – FVM | | |
| Interest-related derivatives | 1,494 | 1,585 |
| Cross-currency derivatives | 799 | 1,129 |
| Total | 9,774 | 10,365 |

As in the previous year, there were no new issues in the current financial year under sub-item certificated liabilities to be measured at fair value. The volume of repayments due to maturity during the same period amounted to EUR 0.2 billion (nominal) (2023: EUR 0.3 billion) and the volume of early repurchases to EUR 0.0 billion (nominal) (2023: EUR 0.0 billion).

Cross-currency swaps are presented under Cross-currency derivatives.

Other derivatives include derivatives with negative fair values of EUR 5 million (31 Dec. 2023: EUR 6 million) attributable to embedded derivatives that are bifurcated.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(49) Value adjustments from macro fair value hedge accounting

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Value adjustments to liabilities under macro fair value hedge accounting	-16	-1

The fair values attributable to hedged risks in the hedged portfolios in the at amortised cost measurement category are included in this item.

(50) Derivatives designated for hedge accounting

Analysis of derivatives with negative fair values designated for hedge accounting by type of hedging relationship

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Micro fair value hedge accounting	5,619	8,188
Macro fair value hedge accounting	1,362	1,112
Total	6,982	9,300

Analysis of derivatives with negative fair values designated for hedge accounting by type of hedging instrument

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Interest-related derivatives	5,068	5,834
Cross-currency derivatives	1,914	3,466
Total	6,982	9,300

(51) Risk provisions

Analysis of Provisions by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Provisions for pensions and similar commitments	1,904	1,844
Provisions for credit risks	74	90
Other provisions	969	877
Total	2,948	2,811

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Development of Provisions for pensions and similar commitments in financial year 2024

	Defined benefit obligations	Early retirement	Partial retirement	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2024	1,809	33	2	1,844
Additions	108	3	1	112
Current service cost	46	0	1	48
Interest cost	62	2	0	64
Actuarial gains and losses	6	0	0	6
Changes in demographic assumptions	0	0	0	0
Changes in financial assumptions	–22	0	0	–22
Changes in experience adjustments	28	0	0	28
Utilisation	–63	–9	–1	–73
Reversals	0	0	0	0
Transfers	0	0	0	0
Contributions by members (recognised in equity)	14	0	0	14
As of 31 Dec. 2024	1,874	27	3	1,904

The average expected residual term of the defined-benefit pension obligations is 16.0 years as of 31 December 2024 (31 Dec. 2023: 16.4 years).

Development of Provisions for pensions and similar commitments in financial year 2023

	Defined benefit obligations	Early retirement	Partial retirement	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2023	1,638	42	3	1,683
Additions	104	1	1	105
Current service cost	40	0	1	41
Interest cost	64	0	0	64
Actuarial gains and losses	121	0	0	121
Changes in demographic assumptions	0	0	0	0
Changes in financial assumptions	124	0	0	124
Changes in experience adjustments	–3	0	0	–3
Utilisation	–60	–9	–2	–70
Transfers	0	0	0	0
Contributions by members (recognised in equity)	6	0	0	6
As of 31 Dec. 2023	1,809	33	2	1,844

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Provisions for pensions and similar commitments are calculated on the basis of the 2018 G Heubeck actuarial tables and the following other actuarial assumptions:

Actuarial assumptions in % p.a.

	31 Dec. 2024	31 Dec. 2023
Technical discount rate	3.49	3.41
Rate of salary increases	3.00	2.20
Rate of pension increases	2.00	2.50
Rate of staff turnover	3.23	3.17

The technical discount rate as of 31 December 2024 reflects an adjustment to the average residual term of the defined benefit pension obligations translating into an adjustment to the average capital commitment period used.

Sensitivity of defined benefit pension obligations as of 31 December 2024

	Difference	Change in defined benefit obligations	Difference	Change in defined benefit obligations
		EUR in millions		EUR in millions
Life expectancy	+1 year	71	-1 year	-73
Technical discount rate	+0.25%	-70	-0.25%	75
Rate of salary increases	+0.50%	13	-0.50%	-12
Rate of pension increases	+0.50%	103	-0.50%	-57
Rate of staff turnover	+1.00%	-1	-1.00%	1

Sensitivity of defined benefit pension obligations as of 31 December 2023

	Difference	Change in defined benefit obligations	Difference	Change in defined benefit obligations
		EUR in millions		EUR in millions
Life expectancy	+1 year	71	-1 year	-73
Technical discount rate	+0.25%	-69	-0.25%	74
Rate of salary increases	+0.50%	13	-0.50%	-12
Rate of pension increases	+0.50%	102	-0.50%	-57
Rate of staff turnover	+1.00%	-1	-1.00%	1

Development of Risk provisions for lending business

For the development of Risk provisions for lending business (off-balance sheet transactions) see the note regarding "Risk provisions".

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to the consolidated statement of financial position

Development of Other provisions in financial year 2024

| | Obligations to employees
EUR in millions | Other provisions
EUR in millions | Total
EUR in millions |
| --- | --- | --- | --- |
| As of 1 Jan. 2024 | 35 | 842 | 877 |
| Additions | 11 | 154 | 165 |
| Utilisation | –8 | –53 | –61 |
| Reversals | –1 | –12 | –13 |
| As of 31 Dec. 2024 | 38 | 931 | 969 |

The Obligations to employees column shows other long-term employee benefits including provisions for service anniversaries. Corresponding actuarial reports have been prepared for these obligations.

Provisions for the obligation vis-à-vis the ERP Special Fund to award grants in an amount of EUR 135 million (31 December 2023: EUR 62 million) in the years ahead are recognised in Other provisions.

An Other provision item in the amount of EUR 100 million (31 Dec. 2023: EUR 57 million) is reported due to the interest rate being below the market rate for irrevocable promotional loan commitments with additional promotional funds in the form of interest rate reductions impacting KfW's earnings position. Changes to existing provisions are presented as net additions or, in the case of a decline, as a transfer via the adjustments to the carrying amounts of already disbursed promotional loans recognised on the assets side under Financial assets at amortised cost – Loans and advances to banks or customers.

Other provisions also comprise obligations in the amount of EUR 634 million (31 Dec. 2023: EUR 633 million) arising from the assumption of the operations of the State Insurance Company of the German Democratic Republic in liquidation (Staatliche Versicherung der Deutschen Demokratischen Republik in Abwicklung – “SinA”, an institution under public law), which are offset by receivables in the same amount from the Federal Agency for Special Tasks Associated with Unification (Bundesanstalt für vereinigungsbedingte Sonderaufgaben – “BvS”) recognised in Other assets. Other provisions also include provisions for legal risks offset by receivables from the Federal Government in the same amount.

Development of Other provisions in financial year 2023

| | Obligations to employees
EUR in millions | Other provisions
EUR in millions | Total
EUR in millions |
| --- | --- | --- | --- |
| As of 1 Jan. 2023 | 32 | 842 | 873 |
| Additions | 8 | 141 | 148 |
| Utilisation | –4 | –123 | –127 |
| Reversals | 0 | –18 | –18 |
| As of 31 Dec. 2023 | 35 | 842 | 877 |

(52) Income tax liabilities

Analysis of Income tax liabilities

| | 31 Dec. 2024
EUR in millions | 31 Dec. 2023
EUR in millions |
| --- | --- | --- |
| Current income tax liabilities | 206 | 82 |
| Deferred income tax liabilities | 23 | 26 |
| Total | 230 | 107 |

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

Current income tax liabilities as of 31 December 2024 primarily consist of tax provisions at the level of taxable companies included in the group.

Deferred income tax liabilities mostly resulted from valuation differences relating to the statement of financial position items listed below.

Composition of deferred tax liabilities by statement of financial position item

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Financial assets at fair value – Other derivatives	0	1
Financial assets at amortised cost	0	1
Financial assets at fair value – Securities and investments	24	23
Investments accounted for using the equity method	4	4
Other statement of financial position items	1	1
Subtotal	29	30
Offset against deferred tax assets	6	4
Total	23	26

(53) Other liabilities

Analysis of Other liabilities

	31 Dec. 2024	31 Dec. 2023
	Mio. EUR	Mio. EUR
Other financial liabilities	300	312
thereof Accruals	202	186
Deferred income	44	39
Lease liabilities	30	34
Total	374	386

Deferred income contains liabilities resulting from contractual obligations ("contract liabilities" in accordance with IFRS 15). These developed as follows:

Development of liabilities from contractual obligations

	2024	2023
	EUR in millions	EUR in millions
As of 1 Jan.	37	38
Additions	25	15
Disposals	-19	-16
As of 31 Dec.	43	37

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to the consolidated statement of financial position

(54) Equity

Analysis of Equity

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Subscribed capital	3,750	3,750
less uncalled outstanding contributions	-450	-450
Paid-in subscribed capital	3,300	3,300
Capital reserve	8,447	8,447
Reserve from the ERP Special Fund	1,191	1,191
Retained earnings	26,552	25,150
Statutory reserve under Article 10 (2) KfW Law	1,875	1,875
Special reserve under Article 10 (3) KfW Law	17,988	17,117
Special reserve less the special loss account from provisioning pursuant to Section 17 (4) of the D-Mark Balance Sheet Law	21	21
Other retained earnings	6,668	6,137
Revaluation reserves	83	-15
Valuation result from the change in own credit risk of liabilities designated at fair value through profit or loss	160	55
Actuarial gains and losses from defined-benefit pension obligations (after tax)	-77	-70
Total	39,573	38,073

The Federal Government owns 80% of KfW's share capital, the German federal states 20%. In accordance with Article 1a of the KfW Law, the Federal Republic of Germany is liable for certain liabilities of KfW. There is no profit distribution in accordance with Article 10 (1) of the KfW Law. KfW's net income amounting to EUR 871 million (2023: EUR 1,336 million) was used to increase the special reserve under Article 10 (3) KfW Law.

Equity forms the basis for the capital available for covering risks, which is matched against the capital requirements derived from internal management.

For information concerning Equity in relation to risk-bearing capacity, see the risk report in the combined management report.

The revaluation reserves developed as follows:

Development of revaluation reserves

	Valuation result from the change in own credit risk of liabilities designated at fair value through profit or loss	Actuarial gains and losses from defined benefit pension obligations	Effects of deferred taxes	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2023	6	52	-9	50
Consolidated comprehensive income	49	-121	7	-65
Other comprehensive income	49	-121	7	-65
As of 31 Dec. 2023	55	-68	-2	-15
Consolidated comprehensive income	105	-6	-1	98
Other comprehensive income	105	-6	-1	98
As of 31 Dec. 2024	160	-74	-3	83

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Notes to financial instruments

The different IFRS 9 measurement categories are abbreviated as follows in the Notes to financial instruments:

ACO = Financial instruments measured at amortised cost
FVM = Financial instruments measured at fair value
FVD = Financial instruments designated at fair value

(55) Gains and losses from financial instruments by measurement category

The following tables show the results from financial instruments included in the different statement of comprehensive income items presented by measurement category. The result from foreign currency translation is not included.

Gains and losses from financial instruments by measurement category in financial year 2024

	Financial assets at amortised cost	Financial liabilities at amortised cost	Financial assets at fair value - FVM	Financial liabilities at fair value			Derivatives designated for hedge accounting	Total
				FVM	FVD	FVD
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Interest income	12,644^{1)}	0	808	241	0	7,488	21,181
Interest expense	-406	-9,579	-89	-430	-356	-7,765	-18,624
Net gains/losses from risk provisions	39	0	0	0	0	0	39
Commission income	3	0	0	0	0	0	3
Commission expense	-10	-5	0	0	0	0	-16
Net gains/losses from hedge accounting	6,085	-6,550	0	0	0	572	107
Net gains/losses from other financial instruments at fair value through profit or loss	0	0	-162	58	194	0	90
Net gains/losses from disposal of financial assets at amortised cost	0	0	0	0	0	0	0
Net other operating income or loss	0	3	0	0	0	0	3
Change in revaluation reserves	0	0	0	0	105	0	105
Total	18,356	-16,132	557	-130	-58	295	2,888

1) Includes interest income from financial guarantees of EUR 38 million.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Gains and losses from financial instruments by measurement category in financial year 2023

	Financial assets at amortised cost	Financial liabilities at amortised cost	Financial assets at fair value – FVM	Financial liabilities at fair value		Derivatives designated for hedge accounting	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Interest income	10,837^{1)}	0	725	374	0	6,464	18,399
Interest expense	–284	–7,599	–64	–354	–347	–7,231	–15,878
Net gains/losses from risk provisions	169	0	0	0	0	0	169
Commission income	9	0	0	0	0	0	9
Commission expense	–10	–5	0	0	0	0	–15
Net gains/losses from hedge accounting	12,277	–13,793	0	0	0	1,807	291
Net gains/losses from other financial instruments at fair value through profit or loss	0	0	–311	304	–186	0	–194
Net gains/losses from disposal of financial assets at amortised cost	0	0	0	0	0	0	0
Net other operating income or loss	0	6	0	0	0	0	6
Change in revaluation reserves	0	0	0	0	49	0	49
Total	22,997	–21,391	350	323	–484	1,040	2,836

1) Includes interest income from financial guarantees of EUR 33 million.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

(56) Disclosures on fair value

The following tables show the financial instruments measured at fair value or for which the fair value is indicated in the Notes according to the valuation methods used. There is also a comparison of fair value and carrying amount.

Fair value of financial instruments by valuation method as of 31 December 2024

	Carrying amount (statement of financial position)	Fair Value			Total	Difference from carrying amount
		Level 1	Level 2	Level 3
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Cash reserves	26,522	26,522	0	0	26,522	0
Financial assets at amortised cost
Loans and advances to banks	320,406	0	28,320	279,286	307,607	-12,799
Loans and advances to customers	144,278	0	778	141,528	142,306	-1,972
Securities and investments	37,982	29,660	3,257	4,899	37,816	-167
Financial assets at fair value
Loans and advances to banks – FVM	58	0	0	58	58	0
Loans and advances to customers – FVM	8,232	0	8,085	147	8,232	0
Securities and investments – FVM	5,123	91	2,699	2,334	5,123	0
Other derivatives – FVM	2,303	0	2,299	4	2,303	0
Value adjustments from macro fair value hedge accounting	-9,375	n/a	n/a	n/a	n/a	9,375
Derivatives designated for hedge accounting	7,445	0	7,445	0	7,445	0
Non-current assets held for sale	37	0	37	0	37	0
Total	543,012	56,273	52,920	428,256	537,449	-5,563
Liabilities and equity
Financial liabilities at amortised cost
Liabilities to banks	6,462	0	6,447	0	6,447	-15
Liabilities to customers	30,089	0	29,367	0	29,367	-722
Certificated liabilities	448,951	396,089	46,383	0	442,472	-6,479
Financial liabilities at fair value
Liabilities to banks – FVD	225	0	225	0	225	0
Liabilities to customers – FVD	719	0	719	0	719	0
Certificated liabilities – FVD	6,537	4,152	2,385	0	6,537	0
Other derivatives – FVM	2,293	0	2,275	18	2,293	0
Value adjustments from macro fair value hedge accounting	-16	n/a	n/a	n/a	n/a	16
Derivatives designated for hedge accounting	6,982	0	6,982	0	6,982	0
Total	502,241	400,241	94,782	18	495,042	-7,200

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Fair value of financial instruments by valuation method as of 31 December 2023

	Carrying amount (statement of financial position)	Fair Value			Total	Difference from carrying amount
		Level 1	Level 2	Level 3
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Cash reserves	47,431	47,431	0	0	47,431	0
Financial assets at amortised cost
Loans and advances to banks	324,475	12	24,706	282,628	307,346	-17,129
Loans and advances to customers	142,644	0	1,257	139,437	140,694	-1,950
Securities and investments	36,057	28,723	2,637	4,609	35,969	-88
Financial assets at fair value
Loans and advances to banks – FVM	41	0	0	41	41	0
Loans and advances to customers – FVM	9,928	0	9,644	284	9,928	0
Securities and investments – FVM	4,509	109	3,029	1,370	4,509	0
Other derivatives – FVM	2,322	0	2,278	44	2,322	0
Value adjustments from macro fair value hedge accounting	-14,771	n/a	n/a	n/a	n/a	14,771
Derivatives designated for hedge accounting	5,443	0	5,443	0	5,443	0
Non-current assets held for sale	78	0	66	12	78	0
Total	558,156	76,275	49,061	428,424	553,760	-4,396
Liabilities and equity
Financial liabilities at amortised cost
Liabilities to banks	5,777	0	5,754	0	5,754	-23
Liabilities to customers	48,290	0	47,455	0	47,455	-835
Certificated liabilities	445,634	387,020	52,738	0	439,758	-5,875
Financial liabilities at fair value
Liabilities to banks – FVD	221	0	221	0	221	0
Liabilities to customers – FVD	818	0	818	0	818	0
Certificated liabilities – FVD	6,613	4,095	2,519	0	6,613	0
Other derivatives – FVM	2,714	0	2,691	23	2,714	0
Value adjustments from macro fair value hedge accounting	-1	n/a	n/a	n/a	n/a	1
Derivatives designated for hedge accounting	9,300	0	9,300	0	9,300	0
Total	519,363	391,115	121,493	23	512,631	-6,732

Interest-related changes in value are also included in measuring the fair value of the financial instruments. Accordingly, when the comparison is made with the carrying amount, it is necessary to take into account the changes in value (interest-related) resulting from the recognition of Loans and advances and borrowings in macro fair value hedge accounting.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Change in level assignment of financial instruments measured at fair value with a transfer between levels 1 and 2 in financial year 2024

	Transfer from level 1 to level 2 EUR in millions	Transfer from level 2 to level 1 EUR in millions
Assets
Financial assets at fair value
Loans and advances to banks – FVM	0	0
Loans and advances to customers – FVM	0	0
Securities and investments – FVM	0	3
Other derivatives – FVM	0	0
Derivatives designated for hedge accounting	0	0
Non-current assets held for sale	0	0
Total	0	3
Liabilities and equity
Financial liabilities at fair value
Liabilities to banks – FVD	0	0
Liabilities to customers – FVD	0	0
Certificated liabilities – FVD	0	0
Other derivatives – FVM	0	0
Derivatives designated for hedge accounting	0	0
Total	0	0

The group primarily made transfers from level 2 to level 1 in financial year 2024 as quoted market prices from active markets were available again for the respective financial instruments. In contrast, there were transfers from level 1 to level 2 in financial year 2023 where there were no quoted market prices from active markets available for the respective financial instruments.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Change in level assignment of financial instruments measured at fair value with a transfer between levels 1 and 2 in financial year 2023

	Transfer from level 1 to level 2 EUR in millions	Transfer from level 2 to level 1 EUR in millions
Assets
Financial assets at fair value
Loans and advances to banks – FVM	0	0
Loans and advances to customers – FVM	0	0
Securities and investments – FVM	0	6
Other derivatives – FVM	0	0
Derivatives designated for hedge accounting	0	0
Non-current assets held for sale	0	0
Total	0	6
Liabilities and equity
Financial liabilities at fair value
Liabilities to banks – FVD	0	0
Liabilities to customers – FVD	0	0
Certificated liabilities – FVD	278	0
Other derivatives – FVM	0	0
Derivatives designated for hedge accounting	0	0
Total	278	0

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Development of financial assets measured at fair value assigned to level 3 in financial year 2024

	Financial assets at fair value				Non-current assets held for sale	Total
	Loans and advances to banks - FVM	Loans and advances to customers - FVM	Securities and investments - FVM	Other derivatives - FVM
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2024	41	284	1,370	44	12	1,751
A. Changes recognised in the income statement
Net interest and commission income	0	-5	0	0	0	-5
Contracts still valid at year-end	0	-4	0	0	0	-4
Net gains/losses from hedge accounting	0	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0	0
Net gains/losses from other financial instruments at fair value through profit or loss	14	0	72	4	0	90
Contracts still valid at year-end	16	1	-9	-2	0	5
Total changes recognised in the income statement	14	-5	72	4	0	85
B. Changes recognised directly in equity
Changes in level assignment	0	0	919	-43	0	877
Transfer from level 1 and level 2	0	0	1,200	0	0	1,200
Transfer to level 1 and level 2	0	0	-280	-43	0	-323
Additions	0	13	450	6	0	470
Disposals	0	-152	-491	-7	0	-651
Total changes recognised directly in equity	0	-139	879	-44	0	695
Changes in consolidated group	0	0	0	0	0	0
Exchange rate changes	3	7	1	1	0	12
Other changes	0	0	12	-1	-12	-1
As of 31 Dec. 2024	58	147	2,334	4	0	2,542

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Development of financial liabilities measured at fair value assigned to level 3 in financial year 2024

	Financial liabilities at fair value				Total
	Liabilities to banks - FVD	Liabilities to customers - FVD	Certificated liabilities - FVD	Other derivatives - FVM
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2024	0	0	0	23	23
A. Changes recognised in the income statement
Net interest and commission income	0	0	0	3	3
Contracts still valid at year-end	0	0	0	4	4
Net gains/losses from hedge accounting	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0
Net gains/losses from other financial instruments at fair value through profit or loss	0	0	0	-6	-6
Contracts still valid at year-end	0	0	0	0	0
Total changes recognised in the income statement	0	0	0	-3	-3
B. Changes recognised directly in equity
Change in revaluation reserves	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0
Changes in level assignment	0	0	0	0	0
Transfer from level 1 and level 2	0	0	0	0	0
Transfer to level 1 and level 2	0	0	0	0	0
Additions	0	0	0	0	0
Disposals	0	0	0	-2	-2
Total changes recognised directly in equity	0	0	0	-2	-2
Exchange rate changes	0	0	0	2	2
Other changes	0	0	0	-1	-1
As of 31 Dec. 2024	0	0	0	18	18

The group carried out transfers from levels 1 and 2 to level 3 because in financial years 2024 and 2023 quoted prices on the active market or observable market parameters were no longer available or their effect on fair value was deemed material. In contrast, the group carried out transfers from level 3 to levels 1 and 2 if quoted prices on the active market or observable market parameters were available again or the effect of non-observable parameters on fair value was deemed immaterial.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Development of financial assets measured at fair value assigned to level 3 in financial year 2023

	Financial assets at fair value				Non-current assets held for sale	Total
	Loans and advances to banks - FVM	Loans and advances to customers - FVM	Securities and investments - FVM	Other derivatives - FVM
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2023	38	202	1,000	1	49	1,289
A. Changes recognised in the income statement
Net interest and commission income	0	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0	0
Net gains/losses from hedge accounting	0	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0	0
Net gains/losses from other financial instruments at fair value through profit or loss	4	0	4	35	-4	39
Contracts still valid at year-end	4	-1	-75	16	-4	-61
Total changes recognised in the income statement	4	0	4	35	-4	39
B. Changes recognised directly in equity
Changes in level assignment	0	0	398	1	-24	375
Transfer from level 1 and level 2	0	0	711	2	0	712
Transfer to level 1 and level 2	0	0	-313	0	-24	-337
Additions	1	288	40	0	0	329
Disposals	-1	-202	-48	0	0	-252
Total changes recognised directly in equity	0	86	390	1	-24	453
Changes in consolidated group	0	0	0	0	0	0
Exchange rate changes	-1	-3	-21	6	-2	-22
Other changes	0	0	-3	1	-6	-8
As of 31 Dec. 2023	41	284	1,370	44	12	1,751

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Development of financial liabilities measured at fair value assigned to level 3 in financial year 2023

	Financial liabilities at fair value				Total
	Liabilities to banks - FVD	Liabilities to customers - FVD	Certificated liabilities - FVD	Other derivatives - FVM
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
As of 1 Jan. 2023	0	0	0	43	43
A. Changes recognised in the income statement
Net interest and commission income	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0
Net gains/losses from hedge accounting	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0
Net gains/losses from other financial instruments at fair value through profit or loss	0	0	0	-15	-15
Contracts still valid at year-end	0	0	0	-25	-25
Total changes recognised in the income statement	0	0	0	-14	-14
B. Changes recognised directly in equity
Change in revaluation reserves	0	0	0	0	0
Contracts still valid at year-end	0	0	0	0	0
Changes in level assignment	0	0	0	-6	-6
Transfer from level 1 and level 2	0	0	0	10	10
Transfer to level 1 and level 2	0	0	0	-17	-17
Additions	0	0	0	0	0
Disposals	0	0	0	0	0
Total changes recognised directly in equity	0	0	0	-6	-6
Exchange rate changes	0	0	0	0	0
Other changes	0	0	0	1	1
As of 31 Dec. 2023	0	0	0	23	23

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

The following tables show how an alternative determination of relevant unobservable data, i.e. values in best and worst case scenarios, would impact fair values for significant products allocated to this level.

Information on unobservable data as of 31 December 2024

Major classes	Valuation method used	Relevant unobservable data with alternative determination	Range
Loans and advances to banks and loans and advances to customers – FVM	Discounted cash flow method	Risk costs	+/- 10%
Securities and investments from equity finance business – FVM	Discounted cash flow method^{1)}	Cost of capital	0.5% to 1.5% (absolute fluctuation)
		Long-term result	5% (relative fluctuation)
		Risk costs	+/- 10%
Other derivatives – derivatives with positive or negative fair values, which comprise a hedging instrument for customers with respect to export and project finance – FVM	Discounted cash flow method	Expected loss	+/- 30%

1) If the cost of capital and the long-term result could not be used for valuation, the sensitivities were calculated on the basis of the cost of risk.

Information on unobservable data as of 31 December 2023

Major classes	Valuation method used	Relevant unobservable data with alternative determination	Range
Loans and advances to banks and loans and advances to customers – FVM	Discounted cash flow method	Risk costs	+/- 10%
Securities and investments from equity finance business – FVM	Discounted cash flow method^{1)}	Cost of capital	0.5% to 1.5% (absolute fluctuation)
		Long-term result	5% (relative fluctuation)
		Risk costs	+/- 10%
Non-current assets held for sale	Discounted cash flow method	Cost of capital	0.5% to 1.5% (absolute fluctuation)
		Long-term result	5% (relative fluctuation)
Other derivatives – derivatives with positive or negative fair values, which comprise a hedging instrument for customers with respect to export and project finance – FVM	Discounted cash flow method	Expected loss	+/- 30%

1) If the cost of capital and the long-term result could not be used for valuation, the sensitivities were calculated on the basis of the cost of risk.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Sensitivity analysis for the financial assets measured at fair value assigned to level 3 as of 31 December 2024

	Best case scenario	Reported value	Worst case scenario
	EUR in millions	EUR in millions	EUR in millions
Financial assets at fair value
Loans and advances to banks – FVM	60	58	56
Loans and advances to customers – FVM	155	147	137
Securities and investments – FVM	2,256	2,334	2,435
Other derivatives – FVM	4	4	4
Non-current assets held for sale	0	0	0
Total	2,474	2,542	2,631

Sensitivity analysis for the financial liabilities measured at fair value assigned to level 3 as of 31 December 2024

	Best case scenario	Reported value	Worst case scenario
	EUR in millions	EUR in millions	EUR in millions
Financial liabilities at fair value
Other derivatives – FVM	18	18	18
Total	18	18	18

Sensitivity analysis for the financial assets measured at fair value assigned to level 3 as of 31 December 2023

	Best case scenario	Reported value	Worst case scenario
	EUR in millions	EUR in millions	EUR in millions
Financial assets at fair value
Loans and advances to banks – FVM	43	41	39
Loans and advances to customers – FVM	292	284	275
Securities and investments – FVM	1,527	1,370	1,225
Other derivatives – FVM	46	44	43
Non-current assets held for sale	13	12	11
Total	1,921	1,751	1,593

Sensitivity analysis for the financial liabilities measured at fair value assigned to level 3 as of 31 December 2023

	Best case scenario	Reported value	Worst case scenario
	EUR in millions	EUR in millions	EUR in millions
Financial liabilities at fair value
Other derivatives – FVM	23	23	23
Total	23	23	23

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

(57) Disclosures on micro fair value hedge accounting

Disclosures on hedged items in micro fair value hedge accounting by risk type – 2024

	Carrying amount of hedged items	Accumulated hedge fair value adjustment (fair value of the hedged risk for the hedged item)	Hedge fair value adjustment to be amortised (discontinued hedge relationships)	Statement of financial position items in which the hedged items are reported	Fair value changes in hedged items to determine hedge ineffectiveness (income statement effect - hedged items)
	EUR in millions	EUR in millions	EUR in millions		EUR in millions
Assets
Interest risk
Securities and investments – Bonds and other fixed-income securities	29,301	-642	0	Financial assets at amortised cost	655
Interest-currency risk
Securities and investments – Bonds and other fixed-income securities	0	0	0	Financial assets at amortised cost	0
Liabilities and equity
Interest risk
Liabilities to banks/customers – promissory note loans	19,419	-710	0	Financial liabilities at amortised cost	-605
Certificated liabilities	246,255	-6,842	90	Financial liabilities at amortised cost	-5,173
Interest-currency risk
Liabilities to banks/customers – promissory note loans	0	0	0	Financial liabilities at amortised cost	0
Certificated liabilities	113,898	-1,329	221	Financial liabilities at amortised cost	-788

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Disclosures on hedged items in micro fair value hedge accounting by risk type – 2023

	Carrying amount of hedged items	Accumulated hedge fair value adjustment (fair value of the hedged risk for the hedged item)	Hedge fair value adjustment to be amortised (discontinued hedge relationships)	Statement of financial position items in which the hedged items are reported	Fair value changes in hedged items to determine hedge ineffectiveness (income statement effect - hedged items)
	EUR in millions	EUR in millions	EUR in millions		EUR in millions
Assets
Interest risk
Securities and investments – Bonds and other fixed-income securities	28,866	-1,296	0	Financial assets at amortised cost	1,156
Interest-currency risk
Securities and investments – Bonds and other fixed-income securities	0	0	0	Financial assets at amortised cost	1
Liabilities and equity
Interest risk
Liabilities to banks/customers – promissory note loans	29,549	-1,314	1	Financial liabilities at amortised cost	-860
Certificated liabilities	223,440	-12,002	135	Financial liabilities at amortised cost	-9,891
Interest-currency risk
Liabilities to banks/customers – promissory note loans	0	0	0	Financial liabilities at amortised cost	0
Certificated liabilities	114,305	-2,286	523	Financial liabilities at amortised cost	-3,062

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Disclosures on hedging instruments in micro fair value hedge accounting by risk type – 2024

	Par value of hedging instruments	Carrying amount of hedging instruments	Statement of financial position items in which the hedging instruments are reported	Fair value changes in hedging instruments to determine hedge ineffectiveness (income statement effect – hedging instruments)	Average interest rate of hedging instruments^{1)}
	EUR in millions	EUR in millions		EUR in millions	%
Assets
Interest risk
Interest-related transactions: interest rate swap	99,353	656	Derivatives designated for hedge accounting	–652	–1.2
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	105,672	5,916	Derivatives designated for hedge accounting	0	1.9^{2)}
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	202,989	3,705	Derivatives designated for hedge accounting	5,761	–2.3
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	76,683	1,914	Derivatives designated for hedge accounting	749	–0.4^{2)}

1) Average interest rate based on the coupon of the fixed leg of the derivatives weighted with nominal volume
2) Cross-currency interest rate swaps are primarily used to hedge interest risks, but also to hedge foreign currency risks. The difference between the average interest rate of the interest rate swaps and the cross-currency interest rate swaps results from the different interest rate of the hedged currencies, among other factors.

Disclosures on hedging instruments in micro fair value hedge accounting by risk type – 2023

	Par value of hedging instruments	Carrying amount of hedging instruments	Statement of financial position items in which the hedging instruments are reported	Fair value changes in hedging instruments to determine hedge ineffectiveness (income statement effect – hedging instruments)	Average interest rate of hedging instruments^{1)}
	EUR in millions	EUR in millions		EUR in millions	%
Assets
Interest risk
Interest-related transactions: interest rate swap	71,418	863	Derivatives designated for hedge accounting	–1,158	–2.1
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	68,931	3,118	Derivatives designated for hedge accounting	–1	1.9^{2)}
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	224,233	4,722	Derivatives designated for hedge accounting	10,797	–3.7
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	113,102	3,466	Derivatives designated for hedge accounting	3,061	–0.2^{2)}

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Analysis of par values of hedging instruments by hedge relationship according to remaining terms as of 31 December 2024

Due	In up to 1 month	Between 1 and 3 months	Between 3 months and 1 year	Between 1 year and 5 years	In more than 5 years
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	616	3,788	6,915	49,387	38,646
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	50	3,765	22,542	63,221	16,094
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	790	11,516	29,453	100,947	60,283
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	60	6,204	12,251	47,582	10,587

Analysis of par values of hedging instruments by hedge relationship according to remaining terms as of 31 December 2023

Due	In up to 1 month	Between 1 and 3 months	Between 3 months and 1 year	Between 1 year and 5 years	In more than 5 years
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	731	1,302	3,042	36,229	30,115
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	215	7,423	9,903	34,736	16,654
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	4,107	2,035	36,775	115,733	65,583
Interest-currency risk
Cross-currency transactions: cross-currency interest rate swap	0	9,913	19,431	74,855	8,902

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

(58) Disclosures on macro fair value hedge accounting

Disclosures on hedged items in macro fair value hedge accounting by risk type - 2024

	Carrying amount of hedged items	Value adjustment from macro fair value hedge accounting	Value adjustment from macro fair value hedge accounting to be amortised (discontinued hedge relationships)	Statement of financial position items in which the hedged items are reported		Fair value changes in hedged items to determine hedge ineffectiveness (income statement effect - hedged items)
				Carrying amount before value adjustment from macro fair value hedge accounting	Value adjustment from macro fair value hedge accounting
	EUR in millions	EUR in millions	EUR in millions			EUR in millions
Interest risk
Assets	265,340	-9,375	4	Financial assets at amortised cost	Value adjustment from macro fair value hedge accounting	5,431
Liabilities and equity	0	-16	-16	Financial liabilities at amortised cost	Value adjustment from macro fair value hedge accounting	15

Disclosures on hedged items in macro fair value hedge accounting by risk type - 2023

	Carrying amount of hedged items	Value adjustment from macro fair value hedge accounting	Value adjustment from macro fair value hedge accounting to be amortised (discontinued hedge relationships)	Statement of financial position items in which the hedged items are reported		Fair value changes in hedged items to determine hedge ineffectiveness (income statement effect - hedged items)
				Carrying amount before value adjustment from macro fair value hedge accounting	Value adjustment from macro fair value hedge accounting
	EUR in millions	EUR in millions	EUR in millions			EUR in millions
Interest risk
Assets	277,527	-14,771	27	Financial assets at amortised cost	Value adjustment from macro fair value hedge accounting	11,120
Liabilities and equity	0	-1	-1	Financial liabilities at amortised cost	Value adjustment from macro fair value hedge accounting	19

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Disclosures on hedging instruments in macro fair value hedge accounting by risk type – 2024

	Par value of hedging instruments	Carrying amount of hedging instruments	Statement of financial position items in which the hedging instruments are reported	Fair value changes in hedging instruments to determine hedge ineffectiveness (income statement effect – hedging instruments)
	EUR in millions	EUR in millions		EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	180,701	873	Derivatives designated for hedge accounting	–4,610
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	69,494	1,362	Derivatives designated for hedge accounting	–677

Disclosures on hedging instruments in macro fair value hedge accounting by risk type – 2023

	Par value of hedging instruments	Carrying amount of hedging instruments	Statement of financial position items in which the hedging instruments are reported	Fair value changes in hedging instruments to determine hedge ineffectiveness (income statement effect – hedging instruments)
	EUR in millions	EUR in millions		EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	199,107	1,463	Derivatives designated for hedge accounting	–9,338
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	47,231	1,112	Derivatives designated for hedge accounting	–1,555

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Notes to financial instruments

Analysis of par values of hedging instruments by remaining terms as of 31 December 2024

Due	In up to 1 month	Between 1 and 3 months	Between 3 months and 1 year	Between 1 year and 5 years	In more than 5 years
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	1,296	1,796	23,358	82,880	71,371
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	325	1,057	6,100	22,090	39,922

Analysis of par values of hedging instruments by remaining terms as of 31 December 2023

Due	In up to 1 month	Between 1 and 3 months	Between 3 months and 1 year	Between 1 year and 5 years	In more than 5 years
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Interest risk
Interest-related transactions: interest rate swap	1,245	1,582	20,643	89,843	85,793
Liabilities and equity
Interest risk
Interest-related transactions: interest rate swap	846	850	1,215	17,048	27,271

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

(59) Additional disclosures on derivatives

Analysis of derivatives by type of hedge

	Notional amount		Fair Value 31 Dec. 2024		Fair Value 31 Dec. 2023
	31 Dec. 2024	31 Dec. 2023	positive	negative	positive	negative
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Interest-related derivatives	675,658	662,522	2,807	6,559	3,861	7,417
Cross-currency derivatives	150,258	156,750	6,854	2,710	3,799	4,590
Credit derivatives	0	0	0	0	0	0
Total	825,916	819,271	9,661	9,269	7,660	12,007

Cross-currency swaps are presented under Cross-currency derivatives.

Analysis of derivatives by counterparty

	Notional amount		Fair Value 31 Dec. 2024		Fair Value 31 Dec. 2023
	31 Dec. 2024	31 Dec. 2023	positive	negative	positive	negative
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
OECD banks	775,691	771,486	8,692	7,303	6,843	9,424
Non-OECD banks	176	142	5	5	4	4
Other counterparties	49,890	47,515	963	1,945	812	2,560
Public sector	159	129	1	17	0	20
Total	825,916	819,271	9,661	9,269	7,660	12,007

The analysis includes financial and credit derivatives which are presented in derivatives designated for hedge accounting and the sub-item other derivatives under Financial assets at fair value or Financial liabilities at fair value. Embedded derivatives that must be bifurcated are not included.

The economic hedge effect of financial derivatives with an aggregate principal amount of EUR 747.4 billion (31 Dec. 2023: EUR 736.2 billion) is reflected in the accounts; it was not possible to reflect the risk-mitigating impact of the remaining financial derivatives in the accounts (hedge accounting).

Unchanged from 31 December 2023, KfW Group did not pledge any collateral (in the form of securities) under derivative transactions that can be resold or repledged at any time without payments being past due.

However, liquid collateral totalling EUR 2,469 million (31 Dec. 2023: EUR 5,260 million) was provided, which is recognised under Financial assets at amortised cost – Loans and advances to banks or customers.

Unchanged from 31 December 2023, KfW Group did not receive any collateral (in the form of securities) under derivative transactions that can be resold or repledged at any time without payments by the protection seller being past due.

However, liquid collateral totalling EUR 3,339 million (31 Dec. 2023: EUR 1,549 million) was accepted, which was reported under Financial liabilities at amortised cost – Liabilities to banks or Liabilities to customers.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

The volume of initial differences between the transaction price and model value arising from the use of a valuation technique that makes significant use of unobservable data which have yet to be amortised over the life of the financial instrument developed as follows during the reporting period:

Day one profit or loss

	2024	2023
	EUR in millions	EUR in millions
As of 1 Jan.	-112	-108
Addition	-9	-22
Reversal	15	16
Exchange rate changes	-2	1
As of 31 Dec.	-108	-112

The net gains/losses from financial derivatives not qualifying for hedge accounting includes amortisation effects in the amount of EUR 11 million (2023: EUR 11 million).

(60) Additional disclosures on financial liabilities at fair value

Disclosures on financial liabilities at fair value as of 31 December 2024

	Financial liabilities at fair value			Total
	Liabilities to banks EUR in millions	Liabilities to customers EUR in millions	Certificated liabilities EUR in millions
Carrying amount	225	719	6,537	7,481
Repayment amount at maturity	245	994	9,120	10,359
Difference	20	275	2,583	2,879
thereof borrowings for which the repayment amount builds up as a result of the capitalisation over time of interest due	0	273	2,739	3,012

Disclosures on financial liabilities at fair value as of 31 December 2023

	Financial liabilities at fair value			Total
	Liabilities to banks EUR in millions	Liabilities to customers EUR in millions	Certificated liabilities EUR in millions
Carrying amount	221	818	6,613	7,651
Repayment amount at maturity	245	1,137	8,900	10,281
Difference	24	319	2,287	2,630
thereof borrowings for which the repayment amount builds up as a result of the capitalisation over time of interest due	0	316	2,522	2,838

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

(61) Contractual payment obligations arising from financial instruments

Analysis of payment obligations by maturity range as of 31 December 2024¹)

	Up to 1 month	More than 1 and up to 3 months	More than 3 months and up to 1 year	More than 1 and up to 5 years	More than 5 years	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Financial liabilities at amortised cost
Liabilities to banks	4,397	19	1,055	896	312	6,679
Liabilities to customers	4,255	2,524	12,008	6,366	6,630	31,782
Certificated liabilities	25,854	29,860	59,643	249,993	124,296	489,646
Financial liabilities at fair value
Liabilities to banks	0	0	1	250	0	251
Liabilities to customers	0	1	3	327	733	1,064
Certificated liabilities	16	40	214	3,789	6,805	10,865
Net obligations arising from derivative financial instruments	-216	-25	-945	-3,464	1,257	-3,392
thereof gross obligations arising from derivative financial instruments	16,995	16,073	32,268	97,221	32,759	195,316
Obligations arising from on-balance sheet financial instruments	34,306	32,419	71,980	258,156	140,033	536,894
Obligations arising from off-balance sheet transactions	145,116	0	0	0	0	145,116
Total	179,422	32,419	71,980	258,156	140,033	682,010

¹) Net obligations arising from derivative financial instruments comprise payment obligations which are offset against the corresponding payment claims from derivative contracts; gross obligations are reported as obligations arising from derivative financial instruments. Off-balance sheet transactions are generally allocated to the first maturity range.

Analysis of payment obligations by maturity range as of 31 December 2023¹)

	Up to 1 month	More than 1 and up to 3 months	More than 3 months and up to 1 year	More than 1 and up to 5 years	More than 5 years	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Financial liabilities at amortised cost
Liabilities to banks	2,549	1,674	529	822	378	5,952
Liabilities to customers	9,520	2,449	12,247	19,838	6,670	50,723
Certificated liabilities	19,930	24,939	78,067	240,928	122,946	486,809
Financial liabilities at fair value
Liabilities to banks	0	0	1	5	246	252
Liabilities to customers	0	1	6	266	998	1,271
Certificated liabilities	46	15	209	3,806	6,820	10,896
Net obligations arising from derivative financial instruments	518	-151	334	1,407	3,307	5,416
thereof gross obligations arising from derivative financial instruments	14,911	19,557	40,188	104,057	37,311	216,024
Obligations arising from on-balance sheet financial instruments	32,562	28,928	91,393	267,071	141,365	561,318
Obligations arising from off-balance sheet transactions	142,462	0	0	0	0	142,462
Total	175,024	28,928	91,393	267,071	141,365	703,781

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

The maturity analysis of lease liabilities as lessee is reported under Other notes (in the "Leasing transactions as lessee" section).

(62) Disclosures on repurchase agreements

Disclosures on repo transactions

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Carrying amount of securities sold under repo transactions that continue to be recognised in Financial assets at amortised cost – Securities and investments	313	260
Financial liabilities at amortised cost – Liabilities to banks (countervalue)	311	257

The fair value of interest-bearing securities sold under repo transactions that continue to be recognised in Financial assets at amortised cost totalled EUR 311 million (31 Dec. 2023: EUR 260 million). The fair value of the corresponding repayment obligations was EUR 311 million (31 Dec. 2023: EUR 257 million).

Moreover, as in 2023, KfW Group did not pledge any collateral (in the form of securities) under repo transactions that can be resold or repledged at any time without payments being past due.

As in 2023, the group did not receive any collateral (in the form of securities) under repo transactions that can be resold or repledged at any time without payments being past due.

As in 2023, the group neither pledged nor accepted any liquid collateral.

Disclosures on reverse repo transactions

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Financial assets at amortised cost – Loans and advances to banks (countervalue)	9,630	6,083
Financial assets at amortised cost – Loans and advances to customers (countervalue)	0	0
Total	9,630	6,083

The fair value of interest-bearing securities purchased under reverse repos that are not recognised amounted to EUR 9,600 million (31 Dec. 2023: EUR 5,950 million).

Moreover, KfW Group did not receive any collateral (in the form of securities) under reverse repo transactions that can be resold or repledged at any time without payments by the protection seller being past due, unchanged from 31 December 2023.

As in 2023, the group did not pledge any collateral (in the form of securities) under reverse repo transactions that can be resold or repledged at any time without payments being past due.

As in 2023, the group neither pledged nor accepted any liquid collateral.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

(63) Disclosure on offsetting financial instruments

Disclosures on financial assets with netting agreements as of 31 December 2024

	Carrying amount of financial assets before offsetting (gross amount)	Netted figure as carrying amount of financial liabilities (gross amount)	Reported financial assets (net amount)	Carrying amount of non-offsettable financial liabilities	Fair value of collateral received	Total net amount
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
OTC derivatives	25,636	16,080^{1)}	9,556	6,066	3,318	172
Reverse repos	9,630	0	9,630	272	9,358	0
Total	35,266	16,080	19,186	6,338	12,676	172

1) Thereof obligations from cash collateral for OTC derivatives with EUREX as the central counterparty in the amount of EUR 4,425 million

Disclosures on financial liabilities with netting agreements as of 31 December 2024

	Carrying amount of financial liabilities before offsetting (gross amount)	Netted figure as carrying amount of financial assets (gross amount)	Reported financial liabilities (net amount)	Carrying amount of non-offsettable financial assets	Fair value of collateral pledged	Total net amount
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
OTC derivatives	20,083	11,655	8,427	6,066	2,299	62
Repos	311	0	311	272	40	0
Total	20,394	11,655	8,739	6,338	2,339	62

The disclosures on financial instruments with netting agreements only include gross and net amounts for financial assets and financial liabilities with netting agreements. The Notes on the two classes Derivatives designated for hedge accounting and Other derivatives also include financial assets with a carrying amount of EUR 192 million (31 Dec. 2023: EUR 207 million) and financial liabilities with a carrying amount of EUR 848 million (31 Dec. 2023: EUR 910 million), in particular from bifurcated embedded derivatives and derivatives not subject to netting agreements.

Receivables from reverse repo transactions are reported under Financial assets at amortised cost – Loans and advances to banks and Loans and advances to customers.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Notes to financial instruments

Disclosures on financial assets with netting agreements as of 31 December 2023

	Carrying amount of financial assets before offsetting (gross amount)	Netted figure as carrying amount of financial liabilities (gross amount)	Reported financial assets (net amount)	Carrying amount of non-offsettable financial liabilities	Fair value of collateral received	Total net amount
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
OTC derivatives	27,775	20,217^{1)}	7,559	5,912	1,538	109
Reverse repos	6,083	0	6,083	178	5,905	0
Total	33,858	20,217	13,641	6,089	7,443	109

1) Thereof obligations from cash collateral for OTC derivatives with EUREX as the central counterparty in the amount of EUR 4,827 million

Disclosures on financial liabilities with netting agreements as of 31 December 2023

	Carrying amount of financial liabilities before offsetting (gross amount)	Netted figure as carrying amount of financial assets (gross amount)	Reported financial liabilities (net amount)	Carrying amount of non-offsettable financial assets	Fair value of collateral pledged	Total net amount
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
OTC derivatives	26,480	15,377	11,103	5,912	5,107	85
Repos	257	0	257	178	80	0
Total	26,737	15,377	11,360	6,089	5,186	85

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Other notes

(64) Off-balance sheet transactions

Analysis by class

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Irrevocable loan commitments	138,628	136,159
Financial guarantee contracts	1,101	1,454
Contingent liabilities from financial guarantees	2,362	2,033
Other contingent liabilities	2,951	2,727
Total	145,041	142,372

All off-balance-sheet transactions are disclosed in the Notes at their par values less any related provisions.

Other contingent liabilities include payment obligations attributable to equity investments which are not fully paid up and do not have to be consolidated.

As part of the sale of its stake in Deutsche Industriebank ("IKB") in 2008, KfW agreed to indemnify IKB for certain legal risks up to a certain amount after IKB's excess. As of the end of the reporting period, no proceedings are pending against IKB which are relevant in this context.

In accordance with IAS 37.92, no further disclosures on contingent liabilities were made.

(65) Trust activities and administered loans

Analysis of trust activities (transactions in KfW's own name but for the account of third parties)

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Loans and advances to banks	785	692
Loans and advances to customers	10,502	10,590
Securities and investments	11,565	10,018
Assets held in trust	22,853	21,299
Liabilities to banks	0	0
Liabilities to customers	22,853	21,299
Liabilities held in trust	22,853	21,299

EUR 13,381 million (31 Dec. 2023: EUR 13,654 million) of the assets held in trust is attributable to KfW Development Bank and DEG. Additional transactions with the Federal Government as trustor in the amount of EUR 5,787 million (31 Dec. 2023: EUR 5,253 million) are transactions mandated by the German Federal Government in accordance with Article 2 (4) of the KfW Law and are included in Securities and investments.

Moreover, KfW held guarantees of EUR 145 million (31 Dec. 2023: EUR 145 million) issued under the European Fund for Sustainable Development ("EFSD"), in trust for the European Union.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Volume of administered loans granted (loans in the name and for the account of third parties)

	31 Dec. 2024	31 Dec. 2023
	EUR in millions	EUR in millions
Administered loans	22,879	21,549

(66) Leasing transactions as lessee

Disclosures on lessee agreements as of 31 December 2024

	Due within one year	Due in between one and five years	Due in more than five years	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Lease liabilities (undiscounted)	8	21	1	30

Disclosures on lessee agreements as of 31 December 2023

	Due within one year	Due in between one and five years	Due in more than five years	Total
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Lease liabilities (undiscounted)	12	21	5	38

Lease payments in the amount of EUR 1 million (2023: EUR 1 million) were incurred for short-term leases in the reporting period. For leases in which the underlying asset is of low value, lease payments amounted to EUR 4 million (2023: EUR 4 million). The group does not apply recognition requirements in either case as provided for in IFRS 16.5.

(67) Average number of employees during the financial year

	2024	2023
Female employees	4,084	3,878
Male employees	4,409	4,195
Gender not indicated	0	0
Total	8,493	8,073
Staff not covered by collective agreements	5,679	5,409
Staff covered by collective agreements	2,382	2,240
Staff in external offices	433	425

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

(68) Remuneration report

The remuneration report describes the basic structure of the remuneration plan for members of the Executive Board and Board of Supervisory Directors; it also discloses their remuneration on an individual basis. The remuneration report is an integral part of the notes to the consolidated financial statements.

Overview of total remuneration of members of the Executive Board and Board of Supervisory Directors

	2024	2023^{1)}
	EUR in thousands	EUR in thousands
Members of the Executive Board	3,972.0	3,766.7
Former members of the Executive Board and their surviving dependants	4,575.3	4,781.3
Members of the Board of Supervisory Directors	188.6	185.2
Total	8,735.9	8,733.3

1) Katharina Herrmann was appointed to the Executive Board of KfW with effect from 8 April 2023.

Remuneration of the Executive Board

The remuneration system for KfW's Executive Board is aimed at appropriately compensating members of the Executive Board for their duties and responsibilities. Executive Board contracts are drawn up based on the 1992 version of the policy for hiring executive board members at credit institutions of the Federal Government (Grundsätze für die Anstellung der Vorstandsmitglieder bei den Kreditinstituten des Bundes). The Federal Public Corporate Governance Code (Public Corporate Governance Kodex des Bundes – "PCGK") is taken into account when drawing up contracts. Each contract is individualised accordingly on this basis.

Components of remuneration

The Executive Board members receive fixed monetary remuneration paid in equal monthly instalments.

The following table shows total remuneration, broken down into remuneration components and other forms of remuneration, as well as additions to pension provisions for each member of the Executive Board.

Annual remuneration of the Executive Board and additions to pension provisions in financial years 2024 and 2023

	Salary		Other remuneration		Total		Additions to pension provisions^{1)}
	2024	2023	2024	2023	2024	2023	2024	2023
	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands
Stefan Wintels (Chief Executive Officer)	838.7	830.5	18.7	18.0	857.4	848.5	693.3	710.5
Katharina Herrmann^{2)}	568.4	412.7	5.1	3.7	573.5	416.4	367.1	627.8
Melanie Kehr	603.4	597.4	15.0	12.2	618.4	609.6	563.1	485.9
Christiane Laibach	568.4	562.8	12.3	14.8	580.7	577.6	300.3	313.9
Bernd Loewen	682.4	665.8	34.4	30.9	716.8	696.7	1,894.4	778.3
Dr Stefan Peiß	603.4	597.4	21.8	20.5	625.2	617.9	362.9	573.0
Total	3,864.7	3,666.6	107.3	100.1	3,972.0	3,766.7	4,181.1	3,489.4

1) The discount rate for pension obligations increased in 2024 due to the rise in long-term capital market rates, from 3.41% (31 Dec. 2023) to 3.49% (31 Dec. 2024).
2) Executive Board member since 8 April 2023

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Breakdown of other remuneration of the Executive Board in financial year 2024

	Company car	Group accident insurance	Health insurance	Long-term care insurance	Cost of maintaining a second home	Other	Total
	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands
Stefan Wintels (Chief Executive Officer)	12.0	0.6	5.1	1.1	0.0	0.0	18.8
Katharina Herrmann	0.0	0.4	4.1	0.5	0.0	0.0	5.0
Melanie Kehr	9.2	0.4	4.9	0.5	0.0	0.0	15.0
Christiane Laibach	6.5	0.4	4.8	0.6	0.0	0.0	12.3
Bernd Loewen	15.6	0.5	17.2	1.1	0.0	0.0	34.4
Dr Stefan Peiß	13.0	0.4	7.3	1.1	0.0	0.0	21.8
Total	56.3	2.7	43.4	4.9	0.0	0.0	107.3

Breakdown of other remuneration of the Executive Board in financial year 2023

	Company car	Group accident insurance	Health insurance	Long-term care insurance	Cost of maintaining a second home	Other	Total
	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands
Stefan Wintels (Chief Executive Officer)	11.5	0.6	4.9	1.0	0.0	0.0	18.0
Katharina Herrmann^{1)}	0.0	0.3	3.0	0.4	0.0	0.0	3.7
Melanie Kehr	7.1	0.4	4.2	0.5	0.0	0.0	12.2
Christiane Laibach	9.6	0.4	4.2	0.6	0.0	0.0	14.8
Bernd Loewen	12.3	0.5	17.2	1.0	0.0	0.0	31.0
Dr Stefan Peiß	12.0	0.4	7.1	1.0	0.0	0.0	20.5
Total	52.5	2.6	40.6	4.5	0.0	0.0	100.1

1) Executive Board member since 8 April 2023

Breakdown of remuneration of the Executive Board from secondary employment in financial years 2024 and 2023

	2024	2023
	EUR in thousands	EUR in thousands
Stefan Wintels (Chief Executive Officer)^{1)}	328.6	342.0
Katharina Herrmann^{2)}	0.0	0.0
Melanie Kehr	38.9	37.8
Christiane Laibach	0.0	0.0
Bernd Loewen	0.0	0.0
Dr Stefan Peiß	0.0	0.0

1) Remuneration payments for 2023 were made in 2024.
2) since 8 April 2023

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Responsibilities

The Presidial and Nomination Committee has discussed the Executive Board remuneration system including contract components since the committee structure was modified in accordance with the applicable Section 25d of the German Banking Act (Kreditwesengesetz – "KWG") and adopts and regularly reviews it. The Presidial and Nomination Committee is advised on these matters by the Remuneration Committee, which in turn works together with the Risk and Credit Committee in order to perform its duties. Likewise after consulting with the Remuneration Committee on the matter, the Board of Supervisory Directors decides upon the basic structure of the Executive Board's remuneration system.

The Presidial and Nomination Committee most recently discussed remuneration issues on 5 December 2024.

Fringe benefits

Other remuneration largely comprises the contractual fringe benefits. Executive Board members are entitled to a company car with driver services for business and personal use. Executive Board members reimburse KfW for using a company car with a driver for private purposes in accordance with applicable tax regulations. They are reimbursed under tax regulations for the cost of maintaining a second home for business reasons.

Executive Board members are insured under a group accident insurance policy. Allowances are provided for health and long-term care insurance. Executive Board members are covered by a directors' and officers' liability insurance policy, which insures them against the risks of financial loss associated with their actions in their capacity as Executive Board members and by a supplemental legal expenses insurance policy and a contractual protection insurance policy. KfW Executive Board members acting in their management capacity are also protected by a special legal expenses group policy for employees covering criminal activities.

No remuneration is paid to members of the Executive Board for assuming executive body functions at group companies.

As with all other executives, Executive Board members may also opt to participate in the deferred remuneration programme – a supplemental company pension scheme financed via tax-free salary conversion. Moreover, they are entitled to anniversary bonuses in accordance with KfW's general company policy.

In addition, the fringe benefits include the cost of security systems at Executive Board members' homes; these benefits are not recognised as Other remuneration but as Non-personnel expenses.

The contractual fringe benefits are subject to taxation as benefits in money's worth for Executive Board members if they cannot be granted on a tax-free basis or if this is contractually agreed. No Executive Board member was granted or promised any benefits by a third party during the past financial year with a view to his/her position as a member of the KfW Executive Board.

Pension benefits and other benefits in the case of early retirement

In accordance with Article 1 (3) of the KfW Bylaws, the appointment of an Executive Board member should not generally extend past the legal age of retirement. Upon reaching the statutory retirement age and the expiry of their Executive Board contract, Executive Board members are entitled to claim pension payments; they are also entitled to pension benefits if their employment relationship terminates due to permanent disability.

Pension commitments for Executive Board members as well as their surviving dependants are based on the 1992 version of the Federal Government's policy for hiring executive board members at credit institutions. The PCGK is taken into account when drawing up the Executive Board contracts.

Executive Board member contracts include a severance pay cap in accordance with the recommendations of the PCGK. In other words, payments to these Executive Board member due to early termination of the Executive Board function without good cause in accordance with Section 626 of the German Civil Code (Bürgerliches Gesetzbuch – "BGB") should not exceed the equivalent of two years' salary or compensation including fringe benefits for the remainder of the contract, depending on which of the amounts is lower.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

The full benefit entitlement totalled 49% of the final salary in the reporting year with different contractual arrangements. The retirement benefit entitlement amounted to 70% of the full entitlement for first-time appointment, with an increase per completed year of service of 0.98 to 1.53 percentage points depending on the contract (from an initial 34.3% to a maximum of 49% of the final salary).

The Executive Board contracts contain additional individual provisions, in particular concerning vesting of pension benefits. The newer contracts also include provisions on retrospective pension contributions where pension benefits are not yet vested and the member in question has not been reappointed, as well as on pension reductions in case of early retirement.

Pension payments to former Executive Board members or their surviving dependants were as follows in 2024 and 2023:

Pension payments to former Executive Board members or their surviving dependants

	2024		2023
	Headcount	EUR in thousands	Headcount	EUR in thousands
Former members of the Executive Board	17	4,035.3	18	4,033.8
Surviving dependants	4	540.0	7	747.5
Total	21	4,575.3	25	4,781.3

Provisions for pension obligations to former members of the Executive Board and their surviving dependants in the amount of EUR 51,462 thousand (31 Dec. 2023: EUR 61,827 thousand) were set up at the end of financial year 2024.

Remuneration of members of the Board of Supervisory Directors

The amount of remuneration to members of the Board of Supervisory Directors is determined by the supervisory authority in accordance with Article 7 (10) of the KfW Bylaws. With the last revision in May 2010, compensation to members of the Federal Government who are members of the Board of Supervisory Directors pursuant to Article 7 (1) nos. 1 and 2 of the KfW Law was set at EUR 0.

In the reporting year, remuneration for other members of the Board of Supervisory Directors pursuant to Article 7 (1) nos. 3–7 of the KfW Law amounted to EUR 5,100 p.a.; remuneration for membership of a Board of Supervisory Directors committee was a standard amount of EUR 600 p.a. for each member. Committee chairs did not receive special remuneration.

Members who join during the year receive their remuneration on a pro rata basis.

A daily allowance (EUR 200 per meeting day) is paid and travel expenses and applicable VAT are reimbursed upon request.

The following table provides details on the remuneration paid to the Board of Supervisory Directors in financial year 2024; stated amounts are net amounts in thousands of euros. Travel expenses are reimbursed upon submission of receipts and are not taken into account in the table.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Remuneration of members of the Board of Supervisory Directors for financial year 2024

No.	Name	Dates of membership	Board of Supervisory Directors membership^{1)}	Committee membership^{1)}	Daily allowance^{2)}	Total
		2024	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands
1.	Dr Robert Habeck	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
2.	Christian Lindner	1 Jan. – 7 Nov.	0.0	0.0	0.0	0.0
3.	Dr Jörg Kukies	7 Nov. – 31 Dec.	0.0	0.0	0.0	0.0
4.	Annalena Baerbock	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
5.	Katharina Beck	1 Jan. – 31 Dec.	5.1	1.2	0.6	6.9
6.	Dr André Berghegger	1 Jan. – 20 Feb.	0.9	0.3	0.0	1.2
7.	Volker Bouffier^{2)}	1 Jan. – 31 Dec.	5.1	1.2	0.2	6.5
8.	Dr Andreas Dressel^{2)}	1 Jan. – 31 Dec.	5.1	0.6	0.0	5.7
9.	Yasmin Fahimi	1 Jan. – 31 Dec.	5.1	1.2	0.4	6.7
10.	Björn Fecker^{2)}	1 Jan. – 31 Dec.	5.1	1.2	0.0	6.3
11.	Robert Feiger	1 Jan. – 31 Dec.	5.1	0.6	0.4	6.1
12.	Tanja Gönner^{4)}	1 Jan. – 31 Dec.	5.1	1.2	0.2	6.5
13.	Olav Gutting	22 Feb. – 31 Dec.	4.5	1.1	0.4	6.0
14.	Gerald Heere^{2)}	1 Jan. – 31 Dec.	5.1	1.8	0.4	7.3
15.	Prof. Dr Hans-Günter Henneke	1 Jan. – 31 Dec.	5.1	0.6	1.4	7.1
16.	Marion Höllinger	1 Jan. – 31 Dec.	5.1	2.5	0.0	7.6
17.	Verena Hubertz	1 Jan. – 31 Dec.	5.1	1.8	0.0	6.9
18.	Harald Hübner^{2)}	1 Jan. – 31 Dec.	5.1	0.0	0.6	5.7
19.	Dr Dirk Jandura	1 Jan. – 31 Dec.	5.1	0.6	1.0	6.7
20.	Andrea Kocsis	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
21.	Stefan Körzell	1 Jan. – 31 Dec.	5.1	1.2	0.4	6.7
22.	Ulrich Lange	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
23.	Steffi Lemke	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
24.	Rainer Neske	1 Jan. – 31 Dec.	5.1	0.6	1.0	6.7
25.	Dr Marcus Optendrenk^{2), 4), 5)}	1 Jan. – 31 Dec.	0.0	0.0	0.2	0.2
26.	Dr Bettina Orlopp	1 Jan. – 31 Dec.	5.1	0.6	0.0	5.7
27.	Cem Özdemir	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
28.	Achim Post	1 Jan. – 22 Mar.	1.3	0.3	0.0	1.6
29.	Daniel Quinten^{4)}	1 Jan. – 31 Dec.	5.1	1.2	0.8	7.1
30.	Prof. Dr Ulrich Reuter	1 Jan. – 31 Dec.	5.1	2.5	0.0	7.6
31.	Michael Richter^{2)}	1 Jan. – 31 Dec.	5.1	0.0	0.6	5.7
32.	Dr Thorsten Rudolph	11 Apr. – 31 Dec.	3.8	0.7	0.2	4.7
33.	Joachim Rukwied^{6)}	1 Jan. – 31 Dec.	5.1	0.6	0.8	6.5
34.	Frank Schäffler	1 Jan. – 31 Dec.	5.1	1.2	0.8	7.1
35.	Jan Wenzel Schmidt	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
36.	Svenja Schulze	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
37.	Holger Schwannecke	1 Jan. – 31 Dec.	5.1	1.8	0.6	7.5
38.	Dr Martin Wansleben	1 Jan. – 31 Dec.	5.1	0.6	0.6	6.3
39.	Dr Kai H. Warnecke	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
40.	Dr Volker Wissing	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
Total			148.2	27.2	13.2	188.6

1) The amounts had not yet been paid out as of the reporting date 31 December 2024.
2) Amount governed by state law
3) Amounts for financial year 2024 until the date of assessment. Any later claims will be included in the next report.
4) Payments for meeting attendance for 2023
5) Member waived entitlement.
6) Payments for meeting attendance for 2021, 2022 and 2023

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Remuneration of members of the Board of Supervisory Directors for financial year 2023

No.	Name	Dates of membership	Board of Supervisory Directors membership^{1)}	Committee membership^{1)}	Daily allowance^{2)}	Total
		2023	EUR in thousands	EUR in thousands	EUR in thousands	EUR in thousands
1.	Christian Lindner	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
2.	Dr Robert Habeck	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
3.	Annalena Baerbock	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
4.	Katharina Beck	1 Jan. – 31 Dec.	5.1	1.1	0.2	6.4
5.	Dr André Berghegger	1 Jan. – 31 Dec.	5.1	1.5	0.8	7.4
6.	Volker Bouffier^{2)}	1 Jan. – 31 Dec.	5.1	1.0	0.2	6.3
7.	Dr Andreas Dressel^{2)}	1 Jan. – 31 Dec.	5.1	0.6	0.2	5.9
8.	Yasmin Fahimi	24 May – 31 Dec.	3.2	0.7	0.0	3.9
9.	Björn Fecker^{2)}	20 Oct. – 31 Dec.	1.1	0.0	0.0	1.1
10.	Robert Feiger	1 Jan. – 31 Dec.	5.1	0.6	0.4	6.1
11.	Tanja Gönner	1 Jan. – 31 Dec.	5.1	1.0	0.4	6.5
12.	Dr Louis Hagen^{5)}		0.0	0.0	0.2	0.2
13.	Gerald Heere^{2)}	1 Jan. – 31 Dec.	5.1	1.5	0.4	7.0
14.	Prof. Dr Hans-Günter Henneke^{4)}	1 Jan. – 31 Dec.	5.1	0.5	1.4	7.0
15.	Reiner Hoffmann	1 Jan. – 8 Feb.	0.6	0.2	0.0	0.8
16.	Dr Bruno Hollnagel	1 Jan. – 31 Dec.	5.1	0.0	0.6	5.7
17.	Verena Hubertz	1 Jan. – 31 Dec.	5.1	1.8	0.2	7.1
18.	Harald Hübner^{2)}	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
19.	Dr Dirk Jandura^{4)}	1 Jan. – 31 Dec.	5.1	0.6	1.6	7.3
20.	Andrea Kocsis	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
21.	Stefan Körzell	1 Jan. – 31 Dec.	5.1	1.2	0.4	6.7
22.	Ulrich Lange	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
23.	Steffi Lemke	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
24.	Rainer Neske^{4)}	1 Jan. – 31 Dec.	5.1	0.6	1.0	6.7
25.	Cem Özdemir	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
26.	Dr Marcus Optendrenk^{2), 6)}	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
27.	Dr Bettina Orlopp	1 Jan. – 31 Dec.	5.1	0.5	0.0	5.6
28.	Dr Hans-Walter Peters^{4)}	1 Jan. – 31 Dec.	5.1	2.5	1.2	8.8
29.	Achim Post	1 Jan. – 31 Dec.	5.1	1.0	0.0	6.1
30.	Daniel Quinten	1 Jan. – 31 Dec.	5.1	1.0	1.0	7.1
31.	Michael Richter^{2), 4)}	1 Jan. – 31 Dec.	5.1	0.0	0.4	5.5
32.	Joachim Rukwied	1 Jan. – 31 Dec.	5.1	0.5	0.0	5.6
33.	Frank Schäffler	1 Jan. – 31 Dec.	5.1	1.2	0.6	6.9
34.	Helmut Schleweis	1 Jan. – 31 Dec.	5.1	2.5	0.0	7.6
35.	Svenja Schulze	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
36.	Holger Schwannecke	1 Jan. – 31 Dec.	5.1	1.8	0.2	7.1
37.	Dietmar Strehl^{2)}	1 Jan. – 5 Jul.	2.8	0.7	1.0	4.5
38.	Dr Martin Wansleben	1 Jan. – 31 Dec.	5.1	0.6	0.4	6.1
39.	Dr Kai H. Warnecke	1 Jan. – 31 Dec.	5.1	0.0	0.6	5.7
40.	Dr Volker Wissing	1 Jan. – 31 Dec.	0.0	0.0	0.0	0.0
Total			145.4	25.2	14.6	185.2

1) The amounts had not yet been paid out as of the reporting date 31 December 2023.
2) Amount governed by state law
3) Amounts for financial year 2023 until the date of assessment. Any later claims will be included in the next report.
4) The daily allowance includes payments for 2022.
5) Payments for meeting attendance for 2022
6) Member waived entitlement.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

There are no pension obligations for members of the Board of Supervisory Directors.

Members of the Board of Supervisory Directors did not receive remuneration in the reporting year for personal services provided.

Members of the Board of Supervisory Directors are also covered by a directors' and officers' liability insurance policy, which insures them against the risks of financial loss associated with their actions in their capacity as Supervisory Directors and by a supplemental legal expenses insurance policy and a contractual protection insurance policy. There are currently no deductibles agreed. KfW Supervisory Directors acting in that capacity are also protected by a special legal expenses group policy for employees covering criminal action brought against Supervisory Directors and by a group accident insurance policy.

(69) Related party disclosures

Transactions between KfW and related parties are concluded as part of operating activities. KfW Group's related parties in accordance with IAS 24 include its subsidiaries which are not consolidated for reasons of immateriality, joint ventures, associates, KfW shareholders, (the Federal Republic of Germany [Federal Government] holds an 80% stake and the federal states a 20% stake in total), interests held by the Federal Government over which it directly has significant influence, key management personnel and their family members and entities over which this group of persons exercise control. As for the persons in the remuneration report, the persons in key positions are limited to the KfW Executive Board and the members of the Board of Supervisory Directors.

KfW has exercised the relief option in accordance with IAS 24.25 for government-related entities.

Transactions with related parties

Disclosures on KfW Group's related parties were revised in financial year 2024 in order to provide a better overview. Quantitative disclosures have been transferred into a table. The following overview displays the scope of the transactions with KfW shareholders, interests held by the Federal Government and group companies as related parties.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Transactions with related parties

	31 Dec. 2024			31 Dec. 2023
	Shareholders	Interests held by the Federal Government	Group companies	Shareholders	Interests held by the Federal Government	Group companies
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Assets
Cash reserves	0	26,522	0	0	47,430	0
thereof Deutsche Bundesbank	0	26,522	0	0	47,430	0
Financial assets at amortised cost	13,623	306	12	13,275	342	134
Securities and investments	2,773	0	0	2,818	0	0
Bonds	2,773	0	0	2,818	0	0
Loans and advances to customers/banks	10,850	306	12	10,457	342	134
Loans and advances	10,850	306	12	10,457	342	146
thereof BAföG government loans	9,242	0	0	8,537	0	0
Risk provisions for loans and advances to customers/banks	0	0	0	0	0	-11
Financial assets at fair value	8,085	0	0	9,643	0	0
Loans and advances to customers/banks	8,085	0	0	9,643	0	0
Loans and advances	8,085	0	0	9,643	0	0
thereof holding arrangements	8,085	0	0	9,643	0	0
Other assets	634	0	0	636	0	0
Liabilities and equity
Financial liabilities at amortised cost	4,662	20,859	74	8,288	34,830	72
Liabilities to customers/banks	4,662	20,859	74	8,288	34,830	72
thereof holding arrangements	327	0	0	299	0	0
thereof German Finance Agency	0	20,859	0	0	34,830	0
Financial liabilities at fair value	0	0	0	0	0	21
Other derivatives – FVM	0	0	0	0	0	21
Other liabilities	0	0	0	0	0	0
Off-balance sheet transactions
Loan commitments, financial guarantees and other commitments granted	11,713	85	2	12,616	0	4
thereof BAföG government loans	10,768	0	0	11,471	0	0
Loan commitments, financial guarantees and other commitments received	138,136	0	0	137,516	0	0

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Transactions with related parties

	31 Dec. 2024			31 Dec. 2023
	Shareholders	Interests held by the Federal Government	Group companies	Shareholders	Interests held by the Federal Government	Group companies
	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Income and expenses
Interest income	509	1,570	5	440	1,606	7
thereof Deutsche Bundesbank	0	1,565	0	0	1,596	0
thereof German Finance Agency	0	1	0	0	0	0
Interest expense	58	261	4	57	576	6
thereof Deutsche Bundesbank	0	0	0	0	0	0
thereof German Finance Agency	0	261	0	0	575	0
Net interest income	451	1,309	1	383	1,030	2
Net gains/losses from risk provisions	0	0	0	0	0	4
Commission income	622	0	0	537	0	0
Commission expense	0	0	0	0	0	0
Net commission income	622	0	0	537	0	0
Net gains/losses from hedge accounting	74	-598	0	133	-818	0
Net gains/losses from other financial instruments at fair value through profit or loss	18	0	3	10	0	9
thereof holding arrangements	18	0	0	10	0	0
Net other operating income or loss	0	0	1	0	0	1

Transactions with shareholders

Any transactions with the Federal Government and the federal states in financial year 2024 are covered by the rules and regulations set forth in the KfW Law. This also includes guarantees received for operations in which the Federal Republic of Germany has a state interest and for which the Federal Government has mandated KfW (mandated transactions in accordance with Article 2 (4) of the KfW Law).

Transactions with the Federal Government are, as a rule, offset by countertrade transactions with a third party. They do not constitute transactions within the meaning of IAS 24. For this reason, the treatment under IAS 24 is exclusively limited to business relationships with the Federal Government.

The bonds are exclusively bonds issued by the federal states.

As regards the holding arrangements, we refer to the Accounting policies section in section (7).

Under Other assets, KfW reports claims for reimbursement from the Federal Government in connection with the agency agreements.

In addition to the holding arrangements, the liabilities primarily include Federal Government funds relating to short-term emergency aid for gas and heat and for interest grants.

The group holds loan commitments and guarantees from the shareholders mainly in connection with stabilisation measures through liquidity assistance for businesses during the coronavirus pandemic, the market funds business of the business sector KfW Development Bank, export, project and real estate financing, assistance to Greece, and measures to support the energy sector.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

As part of a mandated transaction in 2024, the Federal Government commissioned KfW with assistance in developing the national hydrogen core network. To this end, KfW provided a credit facility of EUR 24 billion with a maximum term until 2057. The measure is secured by a guarantee from the Federal Government, thereby releasing KfW from all risks.

There were also agency agreements between the Federal Government and KfW, which are reflected in Net commission income, in particular. Please refer to the information provided in the Notes on "Net commission income" and "Trust activities".

Transactions with interests held by the Federal Government

The liabilities to the German Finance Agency include promissory note loans to refinance support services in the context of the coronavirus pandemic and energy providers. These promissory note loans are hedged against interest risk by means of a micro hedge. This resulted in the hedge result reported under the Net gains/losses from hedge accounting item.

Transactions with group companies

Loans and advances to customers/banks resulted almost exclusively from transactions with group companies and joint ventures. Liabilities to customers/banks resulted from transactions with a subsidiary not included in the consolidated financial statements.

Transactions with key persons

The business relationships between KfW and the members of the Executive Board and of the Board of Supervisory Directors are primarily determined by the KfW By-Laws and by applying the principles of the Federal Public Corporate Governance Code. KfW primarily provides direct loans under its promotional mandate, such as in the area of education financing, and disbursed grants of minor significance. The conditions and prices reflect market conditions or are concluded in accordance with KfW's general conditions for its loan programmes open to the general public.

(70) Auditor's fees

	2024	2023
	EUR in thousands	EUR in thousands
Audit	6,888	6,451
Other attestation services	1,910	1,216
Total	8,798	7,668

The audit fees comprise reversals of provisions totalling EUR 80,000 for the 2023 audit (previous year: EUR 120,000), as well as for other 2023 attestation services in an amount of EUR 15,000.

(71) Disclosures on unconsolidated structured entities

The group's unconsolidated structured entities within the meaning of IFRS 12 relate to the following business sectors:

Structured entities in the business sector Financial markets

KfW makes investments in ABS and ABCP transactions as part of liquidity management and to promote the financing of climate and environmental protection projects. Moreover, the business sector Financial markets also manages an existing portfolio to which no further investments will be added. This portfolio currently consists of securities issued since 2004.

As of 31 December 2024, the carrying amount of the positions held totalled EUR 6.8 billion (31 Dec. 2023: EUR 6.1 billion).

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

Structured entities in the business sector Export and project finance

Tailored leasing/financing concepts are structured via property leasing companies, primarily in the "Aviation and Rail" and "Maritime Industries" sector departments. A separate entity is created for each transaction, with the group participating as the lender. In the case of some of these business partners, the sponsoring banks act as managers of trust companies, but in the majority of cases, these business partners are set up as separate legal entities. The group provides loans to these companies, generally together with other credit institutions. KfW also has credit relationships with some structured entities as market participants in the commodities financing business, where the group supports these customers with pre-export financing structures.

As of 31 December 2024, the carrying amount of the positions held totalled EUR 1.5 billion (31 Dec. 2023: EUR 1.8 billion).

Structured entities in the business sector DEG

As a finance and advisory institution, DEG provides support within its development mandate in line with its business activity guidelines. DEG's mandate is to promote the development of the private sector of a) developing countries, b) central and eastern European countries and New Independent States (NIS), and c) other countries approved by its shareholder KfW in agreement with the Federal Government. In certain isolated cases this is undertaken via investments in structured entities in the form of equity investments and loans. In accordance with the applied risk principles, the risk of loss is limited to the volume invested or committed.

As of 31 December 2024, the carrying amount of the positions held totalled EUR 0.4 billion (31 Dec. 2023: EUR 0.3 billion).

The following table shows the carrying amounts of assets relating to unconsolidated structured entities and the maximum possible loss that could result from these exposures.

Maximum risk of loss as of 31 December 2024

	Loans and advances to customers	Securities and investments	Other assets	Contingent liabilities; irrevocable loan commitments
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Carrying amount	1,531	6,908	1	277
Risk and other provisions	18	0	0	0
Max. risk of loss	1,513	6,908	1	277

Maximum risk of loss as of 31 December 2023

	Loans and advances to customers	Securities and investments	Other assets	Contingent liabilities; irrevocable loan commitments
	EUR in millions	EUR in millions	EUR in millions	EUR in millions
Carrying amount	1,688	6,185	1	405
Risk and other provisions	24	0	0	1
Max. risk of loss	1,664	6,185	1	404

The maximum risk of loss is equal to the nominal amount for credit lines, (financial) guarantees and other liquidity facilities minus the provisions for credit risks recognised in the statement of financial position. The maximum risk of loss relating to the group's investments is their carrying amount (net). The maximum risk of loss does not include effects from the group's hedging instruments used to reduce the maximum risk of loss.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

No support is provided to structured entities in the group beyond the respective financing.

In exceptional cases, the group acts as sponsor for structured entities in which it holds shares purely on a trust basis on behalf of the Federal Government. The risk of these structured entities lies exclusively with the Federal Government. In such cases, the group is considered the sponsor of the structured entities because the entities were initiated and/or structured by the group on behalf of the Federal Government.

(72) Disclosures on shareholdings

Subsidiaries included in the consolidated financial statements

Name/registered office	Share held	Equity (IFRS) as of 31 Dec. 2024	Equity (IFRS) as of 31 Dec. 2023
	%	EUR in millions	EUR in millions
KfW IPEX-Bank GmbH, Frankfurt am Main	100.0	5,079	4,682
DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH, Cologne	100.0	3,155	3,105
KfW Beteiligungsholding GmbH, Frankfurt am Main	100.0	3,321	3,119
Interkonnektor GmbH, Frankfurt am Main	100.0	38	53
KfW Capital GmbH & Co. KG, Frankfurt am Main	100.0	1,234	979
KfW IPEX-Bank Asia Ltd., Singapore	100.0	14	13

Associates included in the consolidated financial statements using the equity method

Name/registered office	Share held	Equity as of 30 Sept. 2024	Equity as of 30 Sept. 2023
	%	EUR in millions	EUR in millions
Microfinance Enhancement Facility S.A., Luxembourg	0.0	-	440
Green for Growth Fund, Southeast Europe S.A., Luxembourg	11.2	744	600
coparion GmbH & Co. KG, Cologne	16.4	342	358
Name/registered office	Share held	Equity as of 31 Dec. 2024	Equity as of 31 Dec. 2023
	%	EUR in millions	EUR in millions
DC Nordseekabel GmbH und Co. KG, Bayreuth	50.0	727	772

Global Gender-Smart Fund S.A. SICAV-SIF (formerly Microfinance Enhancement Facility S. A.), Luxembourg, has not been accounted for using the equity method since financial year 2024, as KfW no longer has significant influence over this entity.

Green for Growth Fund, Southeast Europe S.A. (GGF) has been included in the consolidated financial statements using the equity method since 2010. GGF is a fund to promote SME and private household investment in energy efficiency and renewable energy in the Western Balkans and Turkey (KfW's investment in GGF is also part of the business sector KfW Development Bank).

DC Nordseekabel GmbH und Co. KG (DC Nordseekabel) was accounted for using the equity method, as a joint venture of Interkonnektor GmbH (Nordseekabel-Projekt NordLink in the business sector Export and project finance), for the first time in financial year 2015. The NordLink project is one of the major projects in the European energy sector and comprises an investment volume of around EUR 1.5 to 2 billion. As it will primarily serve as a conduit for renewably sourced energy, the underwater cable will play an important role in the success of Germany's energy transition. Norwegian state-owned power grid operator Statnett, KfW and the transmission systems operator TenneT, which is responsible for the German territory of

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

the North Sea, concluded a cooperation agreement in February 2015 to construct an underwater cable between Germany and Norway. The NordLink project will be realised by a syndicate in which Statnett and DC Nordseekabel each hold a 50% stake. KfW – via its subsidiary Interkonnektor GmbH – and TenneT each hold a 50% stake in DC Nordseekabel, which is responsible for construction and obtaining permits in Germany.

coparion GmbH & Co. KG (coparion; business sector KfW Capital) as an associated company was accounted for using the equity method for the first time in financial year 2016. This co-investment fund by KfW and the German Federal Ministry for Economic Affairs and Climate Action (BMWK) participates in young technology companies by offering venture capital, together with private lead investors.

Entities not included in the consolidated financial statements

Six subsidiaries, one joint venture, and six associated companies of minor significance to the presentation of the net assets, financial and earnings position of KfW Group have not been consolidated; instead, they are shown in the statement of financial position under Securities and investments. These companies account for approximately 0.03% of KfW Group's total assets.

List of KfW Group shareholdings as of 31 December 2024

No.	Name	Place	Capital share in %	CC^{1)}	Exchange rate EUR 1.00 = CU as of 31 Dec. 2024^{2)}	Equity in TCU^{2), 3)}	Net income in TCU^{2), 3)}
KfW shareholdings
A. Fully consolidated subsidiaries included in the consolidated financial statements
1	DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH	Cologne	100.0	EUR	1.00	2,579,013	62,141
2	Interkonnektor GmbH	Frankfurt am Main	100.0	EUR	1.00	54,442	-17,338
3	KfW Beteiligungsholding GmbH	Bonn	100.0	EUR	1.00	2,356,460	627,491
4	KfW Capital GmbH & Co. KG	Frankfurt am Main	100.0	EUR	1.00	877,101	0
B. Subsidiaries not included in the consolidated financial statements
5	Finanzierungs- und Beratungsgesellschaft mbH	Berlin	100.0	EUR	1.00	5,784	120
6	tbg Technologie-Beteiligungsgesellschaft mbH	Bonn	100.0	EUR	1.00	78,351	5,674
C. Other shareholdings (only capital shares totalling at least 20%)
7	Berliner Energieagentur GmbH	Berlin	25.0	EUR	1.00	7,602	-473
Shareholdings of KfW IPEX-Bank GmbH
A. Fully consolidated subsidiaries included in the consolidated financial statements
1	KfW IPEX-Bank Asia Ltd.	Singapore, Singapore	100.0	SGD	1.42	18,662	1,060
B. Subsidiaries not included in the consolidated financial statements
2	KFW Bankengruppe Representacoes Ltda.	São Paulo, Brazil	50.0	BRL	6.43	27	0
Shareholdings of KfW Beteiligungsholding GmbH
A. Fully consolidated subsidiaries included in the consolidated financial statements
1	KfW IPEX-Bank GmbH	Frankfurt am Main	100.0	EUR	1.00	3,230,204	0

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes - Other notes

List of KfW Group shareholdings as of 31 December 2024

No.	Name	Place	Capital share in %	CC^{1)}	Exchange rate EUR 1.00 = CU as of 31 Dec. 2024^{2)}	Equity in TCU^{2), 3)}	Net income in TCU^{2), 3)}
Shareholdings of DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH
A. Subsidiaries not included in the consolidated financial statements
1	DEG Impact GmbH	Cologne	100.0	EUR	1.00	2,981	684
2	DEG Impulse GmbH	Cologne	100.0	EUR	1.00	3,312	401
3	KFW Bankengruppe Representacoes Ltda.	São Paulo, Brazil	50.0	BRL	6.43	27	0
B. Other shareholdings (only capital shares totalling at least 20%)
4	Ace Power Embilipitiya Pvt Ltd.	Colombo, Sri Lanka	26.0	LKR	303.50	5,281,596	736,040
5	ACON Retail MXD, L.P.	Toronto, Canada	100.0	USD	1.04	11,978	-7,369
6	ADP II Holding 11 S.A.R.L.	Luxembourg, Luxembourg	22.2	USD	1.04	62,297	439
7	ADP Enterprises W.L.L.	Manama, Bahrain	23.3	EUR	1.00	229,420	23,558
8	AEP China Hydro Ltd.	Ebène CyberCity, Mauritius	30.2	USD	1.04	292	-104
9	AfricInvest III – SPV 1	Port Louis, Mauritius	21.8	EUR	1.00	51,574	-2,736
10	Agrofundo Brasil VI Fundo de Investimento em Participações Multiestratégia	São Paulo, Brazil	29.9	BRL	6.43	36,622	-7,253
11	AO Bucharagips	Kogon, Uzbekistan	24.9	UZS	13,361.75	152,444,303	92,405,968
12	Apis Growth 2 Ltd.	Ebène CyberCity, Mauritius	25.6	USD	1.04	38,362	5,300
13	Banque Nationale de Développement Agricole S.A.	Bamako, Mali	21.4	XOF	655.96	85,518,000	5,127,000
14	CGFT Capital Pooling GmbH & Co. KG	Berlin, Germany	40.0	EUR	1.00	43	-3
15	Evonik Lanxing (Rizhao) Chemical Industrial Co. Ltd.	Rizhao, China	41.0	CNY	7.58	156,036	-27,230
16	Falcon Holding Inversiones II S.A.C.	Lima, Peru	55.8	PEN	3.90	4)	4)
17	Fortio Co. Ltd.	George Town, Cayman Islands	46.2	USD	1.04	12,894	1,682
18	Grassland Finance Ltd.	Hong Kong, Hong Kong	24.9	CNY	7.58	275,289	-42,521
19	Greater Pacific Capital MIV Ltd.	George Town, Cayman Islands	26.7	USD	1.04	29,914	-208
20	Knauf Gips Buchara OOO	Bukhara, Uzbekistan	25.0	UZS	13,361.75	581,980,665	193,189,965
21	Knauf Gypsum Philippines Inc.	Calaca, Philippines	25.0	PHP	60.30	1,648,916	22,027
22	Landsberg Investments LLC.	Wilmington, USA	52.9	USD	1.04	4)	4)
23	MC II Pasta Ltd.	Ta’Xbiex, Malta	32.2	EUR	1.00	6,475	-1,343
24	Metier Retailability en Commandite Partnership	Dunkeld, South Africa	22.1	ZAR	19.62	1,020,258	-594,305
25	Novel Sky Global Limited	Road Town, Brit. Virgin Islands	25.0	USD	1.04	4)	4)
26	OAO Belgips	Minsk, Belarus	50.0	BYN	3.39	9,584	-3,042
27	Onstar Galaxy SPV Pte. Ltd.	Singapore, Singapore	33.1	USD	1.04	38,932	-15,394
28	Osmanthus II Cayman Investment, L.P.	George Town, Cayman Islands	100.0	USD	1.04	8,795	-430

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Other notes

List of KfW Group shareholdings as of 31 December 2024

No.	Name	Place	Capital share in %	CC^{1)}	Exchange rate EUR 1.00 = CU as of 31 Dec. 2024^{2)}	Equity in TCU^{2), 3)}	Net income in TCU^{2), 3)}
Shareholdings of DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH
B. Other shareholdings (only capital shares totalling at least 20%)
29	Stratus SCP Fleet Fundo de Investimento em Participações – Multiestratégia	São Paulo, Brazil	39.7	BRL	6.43	97,996	14,451
30	TOO Isi Gips Inder	Inderborskiy, Kazakhstan	40.0	KZT	543.23	1,387,960	251,992
31	TOO Knauf Gips Kaptschagaj. Enterprise with share of DEG LLP	Kapchagay, Kazakhstan	40.0	KZT	543.23	12,041,454	6,091,359
32	Vietnam Opportunity Fund II PTE. LTD.	Singapore, Singapore	32.0	USD	1.04	46,201	11,607
33	Whitlam Holding PTE. Ltd.	Singapore, Singapore	38.7	USD	1.04	46,087	-23,563
34	Worldwide Group, Inc	Charlestown, Saint Kitts and Nevis	33.4	USD	1.04	29,760	2,468
Shareholdings of Interkonnektor GmbH
A. Joint ventures included in the consolidated financial statements
1	DC Nordseekabel GmbH & Co. KG	Bayreuth	50.0	EUR	1.00	726,508	27,198
B. Joint ventures not included in the consolidated financial statements
2	DC Nordseekabel Beteiligungs GmbH	Bayreuth	50.0	EUR	1.00	75	3
Shareholdings of KfW Capital GmbH & Co. KG
A. Subsidiaries not included in the consolidated financial statements
1	KfW Capital Verwaltungs GmbH	Frankfurt am Main	100.0	EUR	1.00	41	1

1) ISO currency code
2) CU = currency units in local currency; TCU = thousand currency units in local currency
3) Financial statements prepared in accordance with local financial reporting framework
4) No current annual financial statements are available.

(73) Events after the balance sheet date

No significant events have occurred since 31 December 2024.

KfW Financial Report 2024

Financial Report > Consolidated financial statements > Consolidated notes – Other notes

Frankfurt am Main/Germany, 4 March 2025

KfW

The Executive Board

Stefan Wintels

(Chief Executive Officer)

Katharina Herrmann

Melanie Kehr

Christiane Laibach

Bernd Loewen

Dr Stefan Peiß

KfW Financial Report 2024

Attestations

Responsibility statement 363
Independent auditor's report 364

Financial Report > Attestations > Responsibility statement

Responsibility statement

To the best of our knowledge, and in accordance with the applicable accounting principles, the consolidated financial statements give a true and fair view of the net assets, financial and earnings position of KfW Group, and the combined management report conveys a fair review of the development and performance of the business and the position of KfW Group, together with a description of the principal risks and rewards associated with the expected development of KfW Group.

Frankfurt am Main/Germany, 4 March 2025

KfW

The Executive Board

Stefan Wintels

(Chief Executive Officer)

Katharina Herrmann

Melanie Kehr

Christiane Laibach

Bernd Loewen

Dr Stefan Peitt

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

Independent auditor's report

To Kreditanstalt für Wiederaufbau Anstalt des öffentlichen Rechts, Frankfurt am Main/Germany

REPORT ON THE AUDIT OF THE CONSOLIDATED FINANCIAL STATEMENTS AND OF THE COMBINED MANAGEMENT REPORT

Audit Opinions

We have audited the consolidated financial statements of Kreditanstalt für Wiederaufbau Anstalt des öffentlichen Rechts, Frankfurt am Main/Germany, and its subsidiaries (the Group), which comprise the statement of financial position as at 31 December 2024, the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the financial year from 1 January to 31 December 2024, and the notes to the consolidated financial statements, including material accounting policy information. In addition, we have audited the combined management report for the parent and the group of Kreditanstalt für Wiederaufbau Anstalt des öffentlichen Rechts, Frankfurt am Main/Germany, for the financial year from 1 January to 31 December 2024. In accordance with the German legal requirements, we have not audited the content of the separate combined non-financial report of KfW as the parent company and the group in accordance with Section 289b (3), Sections 315c in conjunction with 289b (3) German Commercial Code (HGB), which is referred to in the section "Non-financial statements" of the combined management report.

In our opinion, on the basis of the knowledge obtained in the audit,

the accompanying consolidated financial statements comply, in all material respects, with the IFRS® Accounting Standards issued by the International Accounting Standards Board (IASB) (hereinafter "IFRS Accounting Standards") as adopted by the EU and the additional requirements of German commercial law pursuant to Section 315e (1) HGB and, in compliance with these requirements, give a true and fair view of the assets, liabilities and financial position of the Group as at 31 December 2024 and of its financial performance for the financial year from 1 January to 31 December 2024, and
the accompanying combined management report as a whole provides an appropriate view of the Group's position. In all material respects, this combined management report is consistent with the consolidated financial statements, complies with German legal requirements and appropriately presents the opportunities and risks of future development. Our audit opinion on the combined management report does not cover the content of the above-mentioned combined non-financial report of KfW as the parent company and the group in accordance with Section 289b (3), Sections 315c in conjunction with 289b (3) HGB.

Pursuant to Section 322 (3) sentence 1 HGB, we declare that our audit has not led to any reservations relating to the legal compliance of the consolidated financial statements and of the combined management report.

Basis for the Audit Opinions

We conducted our audit of the consolidated financial statements and of the combined management report in accordance with Section 317 HGB and in compliance with German Generally Accepted Standards for Financial Statement Audits promulgated by the Institut der Wirtschaftsprüfer (IDW). Our responsibilities under those requirements and principles are further described in the "Auditor's Responsibilities for the Audit of the Consolidated Financial Statements and of the Combined Management Report" section of our auditor's report. We are independent of the group entities in accordance with the requirements of German commercial and professional law, and we have fulfilled our other German professional responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions on the consolidated financial statements and on the combined management report.

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

Other Information

The executive directors and/or the board of supervisory directors are responsible for the other information. The other information comprises

the report of the board of supervisory directors which is expected to be presented to us after the date of this auditor's report,
the separate combined non-financial report of KfW as the parent company and the group in accordance with Section 289b (3), Sections 315c in conjunction with 289b (3) HGB, which is referred to in the section "Non-financial statements" of the combined management report,
the corporate governance report, which also includes the "Declaration of compliance", which is referred to in the section "Declaration of compliance" of the combined management report and which is expected to be presented to us after the date of this auditor's report,
the executive directors' confirmation pursuant to Section 297 (2) sentence 4 and Section 315 (1) sentence 5 HGB regarding the consolidated financial statements and the combined management report, and
all other parts of the annual report,
but not the consolidated financial statements, not the audited content of the disclosures in the combined management report and not our auditor's report thereon.

The board of supervisory directors is responsible for the report of the board of supervisory directors. In accordance with Section 19 of the KfW Bylaws, the executive directors and the board of supervisory directors are required to annually declare that they recognise the Federal Public Corporate Governance Code as amended and to publish the declaration of compliance as part of the corporate governance report. Otherwise the executive directors are responsible for the other information.

Our audit opinions on the consolidated financial statements and on the combined management report do not cover the other information, and consequently we do not express an audit opinion or any other form of assurance conclusion thereon.

In connection with our audit, our responsibility is to read the other information identified above and, in doing so, to consider whether the other information

is materially inconsistent with the consolidated financial statements, with the audited content of the disclosures in the combined management report or our knowledge obtained in the audit, or
otherwise appears to be materially misstated.

Responsibilities of the Executive Directors and the Board of Supervisory Directors for the Consolidated Financial Statements and the Combined Management Report

The executive directors are responsible for the preparation of the consolidated financial statements that comply, in all material respects, with IFRS Accounting Standards as adopted by the EU and the additional requirements of German commercial law pursuant to Section 315e (1) HGB, and that the consolidated financial statements, in compliance with these requirements, give a true and fair view of the assets, liabilities, financial position and financial performance of the Group. In addition, the executive directors are responsible for such internal control as they have determined necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud (i.e. fraudulent financial reporting and misappropriation of assets) or error.

In preparing the consolidated financial statements, the executive directors are responsible for assessing the Group's ability to continue as a going concern. They also have the responsibility for disclosing, as applicable, matters related to going concern. In addition, they are responsible for financial reporting based on the going concern basis of accounting unless there is an intention to liquidate the Group or to cease operations, or there is no realistic alternative but to do so.

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

Furthermore, the executive directors are responsible for the preparation of the combined management report that as a whole provides an appropriate view of the Group's position and is, in all material respects, consistent with the consolidated financial statements, complies with German legal requirements, and appropriately presents the opportunities and risks of future development. In addition, the executive directors are responsible for such arrangements and measures (systems) as they have considered necessary to enable the preparation of a combined management report that is in accordance with the applicable German legal requirements, and to be able to provide sufficient appropriate evidence for the assertions in the combined management report.

The board of supervisory directors is responsible for overseeing the Group's financial reporting process for the preparation of the consolidated financial statements and of the combined management report.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements and of the Combined Management Report

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and whether the combined management report as a whole provides an appropriate view of the Group's position and, in all material respects, is consistent with the consolidated financial statements and the knowledge obtained in the audit, complies with the German legal requirements and appropriately presents the opportunities and risks of future development, as well as to issue an auditor's report that includes our audit opinions on the consolidated financial statements and on the combined management report.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Section 317 HGB and in compliance with German Generally Accepted Standards for Financial Statement Audits promulgated by the Institut der Wirtschaftsprüfer (IDW) will always detect a material misstatement. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements and this combined management report.

We exercise professional judgement and maintain professional scepticism throughout the audit. We also

identify and assess the risks of material misstatement of the consolidated financial statements and of the combined management report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our audit opinions. The risk of not detecting a material misstatement resulting from fraud is higher than the risk of not detecting a material misstatement resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
obtain an understanding of internal control relevant to the audit of the consolidated financial statements and of arrangements and measures relevant to the audit of the combined management report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an audit opinion on the effectiveness of internal control or these arrangements and measures of the Group.
evaluate the appropriateness of accounting policies used by the executive directors and the reasonableness of estimates made by the executive directors and related disclosures.
conclude on the appropriateness of the executive directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in the auditor's report to the related disclosures in the consolidated financial statements and in the combined management report or, if such disclosures are inadequate, to modify our respective audit opinions. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Group to cease to be able to continue as a going concern.

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements present the underlying transactions and events in a manner that the consolidated financial statements give a true and fair view of the assets, liabilities, financial position and financial performance of the Group in compliance with IFRS Accounting Standards as adopted by the EU and with the additional requirements of German commercial law pursuant to Section 315e (1) HGB.
plan and perform the audit of the consolidated financial statements in order to obtain sufficient appropriate audit evidence regarding the financial information of the entities or of the business activities within the Group, which serves as a basis for forming audit opinions on the consolidated financial statements and on the combined management report. We are responsible for the direction, supervision and inspection of the audit procedures performed for the purposes of the group audit. We remain solely responsible for our audit opinions.
evaluate the consistency of the combined management report with the consolidated financial statements, its conformity with German law, and the view of the Group's position it provides.
perform audit procedures on the prospective information presented by the executive directors in the combined management report. On the basis of sufficient appropriate audit evidence we evaluate, in particular, the significant assumptions used by the executive directors as a basis for the prospective information, and evaluate the proper derivation of the prospective information from these assumptions. We do not express a separate audit opinion on the prospective information and on the assumptions used as a basis. There is a substantial unavoidable risk that future events will differ materially from the prospective information.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

OTHER LEGAL AND REGULATORY REQUIREMENTS

Report on the Audit of the Electronic Reproductions of the Consolidated Financial Statements and of the Combined Management Report Prepared for Publication Pursuant to Section 317 (3a) HGB

Audit Opinion

We have performed an audit in accordance with Section 317 (3a) HGB to obtain reasonable assurance whether the electronic reproductions of the consolidated financial statements and of the combined management report (hereinafter referred to as "ESEF documents") prepared for publication, contained in the file, which has the SHA-256 value 25b7be9bb7561572c824652903d49662e2035d21a19157eacb9be9baea3253e7, meet, in all material respects, the requirements for the electronic reporting format pursuant to Section 328 (1) HGB ("ESEF format"). In accordance with the German legal requirements, this audit only covers the conversion of the information contained in the consolidated financial statements and the combined management report into the ESEF format, and therefore covers neither the information contained in these electronic reproductions nor any other information contained in the file identified above.

In our opinion, the electronic reproductions of the consolidated financial statements and of the combined management report prepared for publication contained in the file identified above meet, in all material respects, the requirements for the electronic reporting format pursuant to Section 328 (1) HGB. Beyond this audit opinion and our audit opinions on the accompanying consolidated financial statements and on the accompanying combined management report for the financial year from 1 January to 31 December 2024 contained in the "Report on the Audit of the Consolidated Financial Statements and of the Combined Management Report" above, we do not express any assurance opinion on the information contained within these electronic reproductions or on any other information contained in the file identified above.

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

Basis for the Audit Opinion

We conducted our audit of the electronic reproductions of the consolidated financial statements and of the combined management report contained in the file identified above in accordance with Section 317 (3a) HGB and on the basis of the IDW Auditing Standard: Audit of the Electronic Reproductions of Financial Statements and Management Reports Prepared for Publication Purposes Pursuant to Section 317 (3a) HGB (IDW AuS 410 (06.2022)). Our responsibilities in this context are further described in the "Group Auditor's Responsibilities for the Audit of the ESEF Documents" section. Our audit firm has applied the requirements of the IDW Quality Management Standards.

Responsibilities of the Executive Directors and the Board of Supervisory Directors for the ESEF Documents

The executive directors of the parent are responsible for the preparation of the ESEF documents based on the electronic files of the consolidated financial statements and of the combined management report according to Section 328 (1) sentence 4 no. 1 HGB and for the tagging of the consolidated financial statements according to Section 328 (1) sentence 4 no. 2 HGB.

In addition, the executive directors of the parent are responsible for such internal controls that they have considered necessary to enable the preparation of ESEF documents that are free from material intentional or unintentional non-compliance with the requirements for the electronic reporting format pursuant to Section 328 (1) HGB.

The board of supervisory directors is responsible for overseeing the process for preparing the ESEF documents as part of the financial reporting process.

Group Auditor's Responsibilities for the Audit of the ESEF Documents

Our objective is to obtain reasonable assurance about whether the ESEF documents are free from material intentional or unintentional non-compliance with the requirements of Section 328 (1) HGB. We exercise professional judgement and maintain professional scepticism throughout the audit. We also

identify and assess the risks of material intentional or unintentional non-compliance with the requirements of Section 328 (1) HGB, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our audit opinion.
obtain an understanding of internal control relevant to the audit on the ESEF documents in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an assurance opinion on the effectiveness of these controls.
evaluate the technical validity of the ESEF documents, i.e. whether the file containing the ESEF documents meets the requirements of the Delegated Regulation (EU) 2019/815, in the version in force at the balance sheet date, on the technical specification for this electronic file.
evaluate whether the ESEF documents enable an XHTML reproduction with content equivalent to the audited consolidated financial statements and to the audited combined management report.
evaluate whether the tagging of the ESEF documents with Inline XBRL technology (iXBRL) in accordance with the requirements of Articles 4 and 6 of the Delegated Regulation (EU) 2019/815, in the version in force at the balance sheet date, enables an appropriate and complete machine-readable XBRL copy of the XHTML reproduction.

KfW Financial Report 2024

Financial Report > Attestations > Independent auditor's report

OTHER MATTER – USE OF THE AUDITOR'S REPORT

Our auditor's report must always be read together with the audited consolidated financial statements and the audited combined management report as well as with the audited ESEF documents. The consolidated financial statements and the combined management report converted into the ESEF format – including the versions to be submitted for inclusion in the Company Register – are merely electronic reproductions of the audited consolidated financial statements and the audited combined management report and do not take their place. In particular, the ESEF report and our audit opinion contained therein are to be used solely together with the audited ESEF documents made available in electronic form.

Frankfurt am Main/Germany, 11 March 2025

Deloitte GmbH
Wirtschaftsprüfungsgesellschaft

Signed:
Prof. Dr Carl-Friedrich Leuschner
Wirtschaftsprüfer
(German Public Auditor)

Signed:
Christian Schweitzer
Wirtschaftsprüfer
(German Public Auditor)

KfW Financial Report 2024

Imprint

Published by
KfW Group
Corporate Communications & Brand Management
Palmengartenstrasse 5–9, 60325 Frankfurt am Main, Germany
Phone +49 69 7431 0
[email protected], www.kfw.de

Design and realisation
MEHR Kommunikationsgesellschaft mbH, Düsseldorf, Germany

AI assistant

KFW — Annual Report 2024

65178_rns_2025-06-24_bccd054a-9413-45eb-a485-8c16ff8d806c.pdf

Financial Report 2024

Key figures of KfW Group

Contents

Letter from the Executive Board

Climate action remains a core obligation

Domestic promotional business characterised by private investment in sustainable transformation

International activities to bolster Germany as a business location

KfW Capital boosts Germany's VC ecosystem

Consolidated profit considerably above expectations

Risk-bearing capacity remains very high

Business policy priorities in 2025

KfW's role continues to develop

Management of KfW Group

Executive Board

Directors

Members of the Management Board of KfW IPEX-Bank GmbH

Members of the Management Board of DEG – Deutsche Investitions- und Entwicklungsgesellschaft mbH

Members of the Management Board of KfW Capital GmbH & Co. KG

Report of the Board of Supervisory Directors

Meetings of the Board of Supervisory Directors

Committees of the Board of Supervisory Directors

Changes on the boards

Annual financial statements

Members and tasks of the Board of Supervisory Directors

Dr Robert Habeck

Christian Lindner

Dr Jörg Kukies

Annalena Baerbock

Katharina Beck

Dr André Berghegger

Volker Bouffier

Dr Andreas Dressel

Stefan Evers

Yasmin Fahimi

Björn Fecker

Robert Feiger

Dr Heiko Geue

Tanja Gönner

Olav Gutting

Corporate Governance Report

Declaration of compliance

D&O insurance excess

Delegation to committees

Meetings of the supervisory body

Cooperation between Executive Board and Board of Supervisory Directors

Executive Board

Board of Supervisory Directors

Committees of the Board of Supervisory Directors

Shareholders

Supervision

Transparency

Risk management

Compliance

Accounting and auditing

Efficiency review of the Board of Supervisory Directors

Sustainability/sustainability report/fair taxation

Diversity and equal opportunities/inclusion

Mobile working/work-life balance

Remuneration/equal pay

Combined non-financial report

General information

Environmental information

Social information

Governance information

Taxonomy tables pursuant to Annex VI/XII (EU) 2021/2178 (DDA)

Independent auditor's assurance report

General information

Basis for preparation of the sustainability report for KfW Group

Strategy, business model and value chain

KfW Group's value chain

KfW Group's value chain

Interests and views of stakeholders

Integrating sustainability matters into the business strategy

Business model and strategy in the context of material impacts, risks and opportunities

Assessment of the material impacts, risks and opportunities and their interaction with KfW Group's strategy

Climate and environmental issues in the banking business

E1: Climate change

KFW Annual Report 2024