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International financial institutions

Topic: Organization

 From HandWiki - Reading time: 6 min

An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence are subjects of international law. Its 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. 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.

Today, the world's largest IFI is the European Investment Bank,[1] with a balance sheet size of €573 billion in 2016.[2] This compares to the two components of the World Bank, the IBRD (assets of $358 billion in 2014)[3] and the IDA (assets of $183 billion in 2014).[3] For comparison, the largest commercial banks each have assets of c.$2,000-3,000 billion.

Types

Multilateral development banks

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
  • International Fund for Agricultural Development (IFAD)
  • European Investment Bank (EIB)
  • Islamic Development Bank (IsDB)
  • Asian Development Bank (ADB)
  • European Bank for Reconstruction and Development (EBRD)
  • CAF - Development Bank of Latin America (CAF)
  • Inter-American Development Bank Group (IDB, IADB)
  • African Development Bank (AfDB)
  • Asian Infrastructure Investment Bank (AIIB)

There are also several "sub-regional" multilateral development banks. Their membership typically includes only borrowing nations. The banks lend to their members, borrowing from the international capital markets. Because there is effectively shared responsibility for repayment, the banks can often borrow more cheaply than could any one member nation. These banks include:

There are also several multilateral financial institutions (MFIs). MFIs are similar to MDBs but they are sometimes separated since they have more limited memberships and often focus on financing certain types of projects.

Bretton Woods institutions

Main page: Finance:Bretton Woods system

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 lent 61 billion euros to global projects in 2011.

Founded Name www Address Notes HQ
1944 IMF International Monetary Fund http://www.imf.org Specialised agency of the United Nations Washington, DC
1944 IBRD International Bank for Reconstruction and Development http://www.worldbank.org World Bank Group, Specialised agency of the United Nations Washington, DC
1956 IFC International Finance Corporation http://www.ifc.org World Bank Group Washington, DC
1960 IDA International Development Association http://www.worldbank.org/ida World Bank Group Washington, DC
1966 ICSID, International Centre for Settlement of Investment Disputes http://icsid.worldbank.org/ICSID/Index.jsp World Bank Group Washington, DC
1988 MIGA Multilateral Investment Guarantee Agency http://www.miga.org World Bank Group Washington, DC
30/10/47 GATT General Agreement on Tariffs and Trade, basis for the creation of World Trade Organization (WTO) in 1995 http://www.wto.org/english/docs_e/legal_e/06-gatt_e.htm http://wto.org The GATT is not an organisation. The WTO is not a United Nations agency Geneva for the WTO

Regional development banks

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. The Islamic Development Bank is among the leading multilateral development banks. IsDB is the only multilateral development bank after the World Bank that is global in terms of its membership. 56 member countries of IsDB are spread over Asia, Africa, Europe and Latin America.

Founded Name www Address Notes HQ
1959 IDB Interamerican Development Bank http://www.IADB.org Works in the Americas, but primarily for development in Latin America and the Caribbean Washington
1960 CABEI Central American Bank for Economic Integration http://www.cabei.org Central America Tegucigalpa
1964 AFDB African Development Bank http://www.afdb.org Africa Abidjan
1973 IsDB Islamic Development Bank Group http://www.isdb.org 56 countries in Asia, Africa, Europe, and Latin America Jeddah
1966 ADB Asian Development Bank http://www.adb.org Asia Manila
1970 CAF Development Bank of Latin America http://www.caf.com Latin America Caracas
29/5/91 EBRD European Bank for Reconstruction and Development http://www.ebrd.com London
16/4/56 CEB Council of Europe Development Bank http://www.coebank.org Coordinated organisation Paris
14/11/73 BOAD Banque ouest-africaine de développement West African Development Bank http://www.boad.org Union économique et monétaire ouest-africaine, Cf.BCEAO Banque centrale des États de l'Afrique de l'Ouest Lomé
1975 BDEAC Banque de developpement des États de l'Afrique centrale, Development Bank of Central African States http://www.bdeac.org Communauté économique et monétaire de l'Afrique centrale (CEMAC). Not to be confused with BEAC Banque des États de l’Afrique centrale Brazzaville, Congo

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. Examples include:

  • the Netherlands Development Finance Company FMO,[4] headquarters in The Hague; one of the largest bilateral development banks worldwide.
  • the DEG German Investment Corporation or Deutsche Investitions- und Entwicklungsgesellschaft,[5] headquartered in Köln, Germany.
  • the French Development Agency,[6] and Caisse des dépôts, founded 1816, both headquartered in Paris, France.
  • the CDC Group,[7] is a development finance institution owned by the UK Government headquartered in London.

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 are central banks, followed by development and investment banks. The table below lists some of them in chronological order of when they were founded or listed as functioning as a legal entity. Some institutions were conceived and started working informally 2 decades before their legal inception (e.g. the South East Asian Central Banks Centre)

Founded Name www Address Notes HQ
17/5/1930 BIS Bank of International Settlements http://www.bis.org The bank of all central banks, 60 members Basle, Basel, Bâle
1958 EIB European Investment Bank http://www.eib.org Created by European Union member states to provide long-term finance, mainly in the EU Luxembourg
2/15/1965 AACB African Association of Central Banks, ABCA Association des Banques Centrales Africaines http://www.aacb.org/ Consists of 40 African central banks Dakar, Senegal.
10/7/1970 IIB International Investment Bank http://www.iib.int Consists of 9 member countries from 3 continents Moscow, Russia
8/1976 NIB Nordic Investment Bank[8] http://www.nib.int Lending operations in its 8 member countries and emerging markets on all continents.[9] Helsinki, Finland
3/2/1982 SEACEN South East Asian Central Banks Centre http://www.seacen.org 19 Asian central banks Kuala Lumpur, Malaysia
24/1/1997 BSTDB Black Sea Trade and Development Bank http://www.bstdb.org 11 member countries,corresponding to the Organization of the Black Sea Economic Cooperation Thessaloniki, Greece
1998 ECB European Central Bank http://www.ecb.int Central bank of 18 EU countries that have adopted the euro Frankfurt am Main

See also

References

  1. ↑ Maartje van Putten (2008-11-20). Policing the Banks: Accountability Mechanisms for the Financial Sector. p. 146. https://books.google.co.uk/books?id=hJmkfWRVF68C&pg=PA146&lpg=PA146#v=onepage&q&f=false. Retrieved 2016-08-01. 
  2. ↑ EIB annual report, 2016
  3. ↑ 3.0 3.1 "Archived copy". Archived from the original on 2015-03-21. https://web.archive.org/web/20150321071505/https://openknowledge.worldbank.org/bitstream/handle/10986/20093/WBAR%202014%20FinancialStatements.pdf?sequence=15. Retrieved 2015-02-28. 
  4. ↑ "Archived copy". Archived from the original on 2011-09-05. https://web.archive.org/web/20110905205104/http://www.fmo.nl/smartsite.dws?id=46. Retrieved 2011-06-04. 
  5. ↑ "Homepage". https://www.deginvest.de/International-financing/DEG/. Retrieved 2017-04-24. 
  6. ↑ "Home". http://www.afd.fr/lang/en/home. Retrieved 2016-08-01. 
  7. ↑ "Home". http://www.cdcgroup.com/. Retrieved 2017-09-11. 
  8. ↑ "Nordic Investment Bank". http://www.nib.int. Retrieved 2016-08-01. 
  9. ↑ "Nordic Investment Bank - About NIB". http://www.nib.int/about_nib. Retrieved 2016-08-01. 

External links




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