The European Investment Bank (EIB) could recall the loans given to Volkswagen in the wake of the emissions scandal, its president, Werner Hoyer, said.

Speaking to a German newspaper, Mr Hoyer said the EIB had given the car manufacturer loans to pay for research and development on things like low emission engines. Around €1.8 billion (£1.6bn) of those loans are still outstanding, Sueddeutsche Zeitung reported.

The EIB is reported to have loaned Volkswagen €4.6bn since 1990.

"The EIB could have taken a hit [from the emissions scandal] because we have to fulfil certain climate targets with our loans," Werner Hoyer said.

He said that the EIB would conduct a thorough investigation into what Volkswagen used the loans for. If it found that the money was used for other purposes, it would "ask ourselves whether we have to demand loans back".

Volkswagen has said 11 million of its vehicles are affected by the emissions scandal - in which the car maker is found to have cheated emissions tests using a 'defeat device'.