Regional lending institutions provide loans and technical assistance to states with a view to their socio-economic development. Today there are Inter-American, African, Asian banks. They are united by goals and activities. In this article, we will examine in detail the existing international development banks.
Destination
International development banks were formed for a number of reasons:
1) increasing the role of countries in the world community;
2) the need to address issues that are not always taken into account by the IMF;
3) attraction of external financing resources in order to provide a loan;
4) support for cooperation and economic integration of countries;
5) the interest of the IDB members (mainly non-regional) in stimulating exports.
Differences and Generalities
International development banks have a differentiated level of social, cultural, economic development of countries. But they pursue similar goals: stimulating the comprehensive growth of regions. Much attention is paid to poverty reduction in Asia and Africa.
About a third of the members of credit institutions are developed countries. They own most of the capital, they influence the activities of organizations. Any decision made by international regional development banks (MDBs, ADBs, AfDBs) may be blocked by the United States, Japan, Nigeria.
The votes of the participants are distributed depending on the capital contributed. Although, according to the Charter, the majority should belong to regional members, their share has now decreased to a minimum (approximately 50.02%) due to an increase in the number of developed countries in the composition.
ICBMs
The Inter-American Development Bank is an interstate organization created to lend to programs in Latin America back in 1959. The board is located in Washington, the governing body is the Board of Governors, which is elected for five years. The bank has 27 regional and 20 non-regional shareholders. Registered capital - $ 34 billion, the United States has 30% of the vote. Resources are mobilized from international capital markets. The Bank provides loans on standard commercial terms.
ADB
The African Development Bank was founded by the Organization of African Unity with the goal of promoting the economic development of the entire continent. Equity is $ 100 billion. Interestingly, member countries contributed only 7.6% of this amount, the rest remained in the form of a guaranteed payment. Under them, ADB attracts additional funds in the loan capital market. The organization has no problems with resources. But most of the capital is concentrated in African countries.
ADB
The funds of the Asian Development Bank are used to stimulate the growth of the economies of Asia and the Far East. The headquarters is located in the Philippines. Funds are provided to both participants and legal entities. The average loan amount is $ 15 million. The main areas of investment are industry, transport, agriculture, energy, and the financial sector. Funds are allocated from funds. The usual one is intended for lending at an interest rate of 5% for 15-25 years. Special is used for lending for a long term (25-40 years) at 1-3%. The grace period is 3-5 and 10 years.
IBRD
The International Bank for Reconstruction and Development was established in 1944 by 170 member states. It is also called Worldwide. The function of the IBRD is to provide loans to governments of developing countries and government organizations. The recipient must use the funds for their intended purpose. The International Bank for Reconstruction and Development is a credit institution, which at the very beginning of its activity was called upon to pay attention to the restoration of the economy of all countries of the world.
Features of the provision of loans
Only IMF member countries can be members of a bank. The capital of the institution is created by subscription in accordance with the share calculated for each state, depending on its economic potential. The largest quota (17.5%) and the number of votes (17%) belong to the United States of America. The Bank provides loans only to solvent borrowers; it does not postpone the terms of payments on loans; therefore, it never receives losses. The institution has accumulated extensive experience in project finance. Its functioning constantly accounts for more than half of the annual amount of funds allocated by all participants.
The bank's resources include equity, profit, medium and long-term loans. Member contributions make up less than 5% of the IBRD budget. Governments buy shares in a predetermined amount, which is determined by the level of economic development of the state, but pay only a small part of their value. The remainder is “demand money”, in case the bank incurs tremendous losses. This capital can only be directed to the payment of funds on bonds.
Guide
The executive body of the institution is the Directorate. It is based on 5 committees: audit, administrative, personnel policy, development of regulations, cost-effectiveness. The IBRD and the IMF are coordinated by the Governing Councils. He considers such issues: the interaction of policies of industrialized countries, debt reduction of industrial regions, the development of the private sector, and also prepares reports for managers.
CB "International Development Bank"
ICBM is a metropolitan lending institution, the main activities of which are operations with debt securities, loans and cash settlement services. It was founded in 1994. In the structure of the owners, small Moscow firms were noticed: Alexis Concept, FC Garant, Galeon-TM. To date, the commercial development bank reports to Intergazneft LLC and Urengoymontazhpromstroy OJSC.
The institution includes a head office and two additional offices in the capital. The International Development Bank (Moscow) is focused on the sale of bonds. Corporate clients are provided with a classic set of services, including lending and cash settlement services. Borrowers are mainly trading enterprises. Private clients have access to all services except car loans and mortgages. In total, the financial institution has 5 thousand customers.
Capital
In the structure of net assets, a significant share is held by bonds of Russian issuers (45%) and a loan portfolio (37%). The commercial development bank has a large amount of reserves (48%) and overdue debt (26%). At the beginning of the third quarter of 2013, the institution attracted about a third of liabilities from the interbank lending market. Another quarter is occupied by balances on deposits of corporate clients, 4% is accounted for by individuals. Despite significant deductions, in the rating of Russian banks CB CBR takes 373rd place.
Conclusion
International development banks were created by state and private organizations with the aim of assisting in the economic and social advancement of states. They are also united by the same lines of activity. But any decision of such an organization can be corrected by the participating country with the largest number of votes.