INTERNATIONAL FINANCIAL INSTITUTIONS

International financial institutions (IFIs) are financial institutions that have been established (or chartered) by more than one country, and hence are subjects of international law. Their owners or shareholders are generally national governments, although other international institutions and other organizations occasionally figure as shareholders. The most prominent IFIs are creations of multiple nations, although some bilateral financial institutions (created by two countries) exist and are technically IFIs. Many of these are multilateral development banks (MDB).

1. Multilateral development bank

A multilateral development bank (MDB) is an institution, created by a group of countries that provides financing and professional advising for the purpose of development. MDBs have large memberships including both developed donor countries and developing borrower countries. MDBs finance projects in the form of long-term loans at market rates, very-long-term loans (also known as credits) below market rates, and through grants.

The following are usually classified as the main MDBs:

World Bank European Investment Bank(EIB) Asian Development Bank (ADB) European Bank for Reconstruction and Development (EBRD) Inter-American Development Bank Group (IDB, IADB)

2. Bretton Woods institutions

The best-known IFIs were established after World War II to assist in the reconstruction of Europe and provide mechanisms for international cooperation in managing the global financial system . They include the World Bank, the IMF, and the International Finance Corporation. Today the largest IFI in the world is the European Investment Bank which leant 61 billion euros to global projects in 2011.

IMF International Monetary Fund IBRD International Bank for Reconstruction and Development IFC International Finance Corporation IDA International Development Association ICSID, International Centre for Settlement of Investment Disputes MIGA Multilateral Investment Guarantee Agency

3. Regional Development Bank

The regional development banks consist of several regional institutions that have functions similar to the World Bank group's activities, but with particular focus on a specific region. Shareholders usually consist of the regional countries plus the major donor countries. The best-known of these regional banks cover regions that roughly correspond to United Nations regional groupings, including the Inter-American Development Bank, the Asian Development Bank; the African Development Bank; the Central American Bank for Economic Integration; and the European Bank for Reconstruction and Development.

4. Bilateral development banks and agencies

A bilateral development bank is a financial institution set up by one individual country to finance development projects in a developing country and its emerging market, hence the term bilateral, as opposed to multilateral.

5. Other regional financial institutions

Financial institutions of neighboring countries established themselves internationally to pursue and finance activities in areas of mutual interest; most of them arecentral banks, followed by development and investment banks.

World Bank

World Bank is United Nations international financial institution that provides financial and technical assistance to developing countries around the world. World Bank was established in 1944 at Bretton Woods Conference. It provides low-interest loans, interest-free credits, and grants for basic needs of people in developing nations and invests in their capital programs. These support a wide array of investments in such areas as education, health, public administration, infrastructure, financial and private sector development, agriculture, and environmental and natural resource management.

World Bank provides or facilitates financing through co-financing with government, other multilateral institutions, commercial banks, export credit agencies, private sector investors, and trust fund partnerships with bilateral and multilateral donors.

President: Dr. Jim Yong Kim

HEADQUARTERS

The World Bank1818 H Street, NW USAWashington, DC 20433

Country Office: India

Sunita Malhotra

New Delhismalhotra@worldbank.org

The institutions of the World Bank Group are:

1. International Bank for Reconstruction and Development (IBRD)2. International Development Association (IDA)3. International Finance Corporation (IFC)4. Multilateral Investment Guarantee Agency (MIGA)5. International Centre for Settlement of Investment Disputes (ICSID).

IBRD

The International Bank for Reconstruction and Development (IBRD) aims to reduce poverty in middle-income countries and creditworthy poorer countries by promoting sustainable development through loans, guarantees, risk management products, and analytical and advisory services. Established in 1944 as the original institution of the World Bank Group, IBRD is structured like a cooperative that is owned and operated for the benefit of its 188 member countries.

IBRD raises most of its funds on the world's financial markets and has become one of the most established borrowers since issuing its first bond in 1947. The income that IBRD has generated over the years has allowed it to fund development activities and to ensure its financial strength, which enables it to borrow at low cost and offer clients good borrowing terms.

supports long-term human and social development needs that private creditors do not finance;

preserves borrowers' financial strength by providing support in crisis periods, which is when poor people are most adversely affected;

uses the leverage of financing to promote key policy and institutional reforms (such as safety net or anticorruption reforms);

creates a favorable investment climate in order to catalyze the provision of private capital;

provides financial support (in the form of grants made available from the IBRD's net income) in areas that are critical to the well-being of poor people in all countries.

India was the 4th largest borrower from IBRD in the World Bank Fiscal Year (FY) 2012 with respect to the Share of Total Loans Outstanding with IBRD and total borrowings of $ 47.9 Billion.

IDA

IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. It is the single largest source of donor funds for basic social services in these countries. IDA-financed operations deliver positive change for 2.5 billion people, the majority of whom survive on less than $2 a day.

IDA lends money on concessional terms. This means that IDA charges little or no interest and repayments are stretched over 25 to 40 years, including a 5- to 10-year grace period. IDA also provides grants to countries at risk of debt distress.

Since its inception, IDA has supported activities in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of that going to Africa. For the fiscal year ending on June 30, 2013, IDA commitments reached $16.3 billion spread over 160 new operations.

IFC

IFC was established to stimulate private investment in the Bank's borrowing countries. IFC has three business–

1. Investment Services- IFC provides a broad suite of financial products and services—including loans, equity, trade finance, structured finance, and syndications—designed to promote development in emerging economies.

2. Advisory Services- IFC offers advice, problem solving, and training to companies, industries, and governments, all aimed at helping private sector enterprises overcome obstacles to growth.

3. IFC Asset Management- IFC mobilizes and manages third-party capital funds for investment in developing and frontier markets.

IFC coordinates its activities with the other institutions of the World Bank Group but is legally and financially independent. India is IFC member since July 20, 1956.

IFC Executive Vice President and CEO - Jin-Yong Cai

Headquarters:International Finance Corporation2121 Pennsylvania Avenue, NWWashington, DC 20433 USA

MIGAMIGA is a member of the World Bank Group and has mission to promote foreign direct investment (FDI) into developing countries. MIGA focuses on insuring investments in following areas-

Countries eligible for assistance from the International Development Association (the world’s poorest countries)

Conflict-affected environments

Complex deals in infrastructure and extractive industries, especially those involving project finance and environmental and social considerations

Middle Income Countries where we can have impact

MIGA’s guarantees protect investments against-non-commercial risks and can help investors obtain access to funding sources with improved financial terms and conditions. MIGA was established in 1988 and has issued more than $28 billion in political risk insurance for projects in a wide variety of sectors, covering all regions of the world.Executive Vice President- Keiko Honda

HeadquartersMultilateral Investment Guarantee Agency1818 H Street, NWWashington DC20433 USA

International Monetary Fund