European Stability Mechanism ‘AAA’ Ratings Affirmed; Outlook Stable in World Economy News 02/02/2026 On Jan. 30, 2026, S&P Global Ratings affirmed its ‘AAA’ long-term and ‘A-1+’ short-term foreign currency issuer credit ratings on the European Stability Mechanism (ESM). The outlook is stable. The stable outlook reflects our expectation that the ESM will maintain its extremely strong enterprise risk profile and financial risk profile and incorporates our view that member states will remain highly supportive of the ESM. We could lower our ratings if we consider that the ESM’s policy importance has weakened, for example, because of a lack of shareholder support, or its funding and liquidity profile deteriorates markedly. The ESM’s financial risk profile could weaken if there is a sizable loan disbursement that causes the RAC ratio to drop below 15%. However, if its capital ratio erodes, we expect the effect to be mitigated by the ESM’s existing eligible callable capital, provided by the ‘AAA’ rated members. The affirmation reflects the ESM’s strengthened capital adequacy. Our assessment of the ESM’s capital position has strengthened after our recalibration of PCT risk weights and changes to the single-name concentration charge under our revised criteria “Multilateral Lending Institutions And Other Supranational Institutions Ratings Methodology,” Oct. 13, 2025. As a result, the ESM’s RAC ratio stands at 30.2% as of end-2024 against 20.6% as per our previous calculation. The ESM benefits from a unique callable capital structure, and we continue to think that shareholders would unconditionally and within a timely period respond to a capital call by the ESM, but we do not consider the ESM’s callable capital features as sufficiently equity-like to be viewed as early trigger contingent capital (ETCC). The ESM’s callable capital has some unique features that offer the ESM the opportunity to call capital in various situations with different trigger levels designated within framework agreements. However, we do not regard these callable capital layers as equity-like because they do not individually fully fulfill our requisites for ETCC that include unconditionality, timeliness, and the conversion of callable capital into paid-in capital at a point in time that would support an entity on a going-concern basis, i.e., occurring well before any call on any conventional callable capital would be made. For instance, while we think that shareholders would unconditionally and within a timely period, as stated under their treaty obligations, respond to an emergency capital call by the ESM–the most stringent capital call for the ESM’s shareholders, this call could only occur to avoid a default of any scheduled or other payment obligation due to the ESM’s creditors, hence not meeting our going concern basis requisite. As a result, we will continue to recognize the strength and uniqueness within the supranational universe of the ESM’s callable capital, but we do not consider the ESM’s callable capital to be equivalent to paid-in capital. Bulgaria was accepted as the 21st member on Dec. 12, 2025, and its parliament is expected to ratify the ESM treaties in the first half of 2026 before it becomes a full member. During the first 12 years of ESM membership, Bulgaria is expected to benefit from a temporary correction period where its capital contribution will be lower, approximately €600 million. The payment of this amount will be made in five annual instalments. F