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IFC Becomes First Multilateral Institution to Sign National Association of Financial Markets Institutional Investors’ Swap Agreements with Chinese Banks


In Washington:
Alexandra Klopfer
Phone: +1 202 473-4645
E-mail: aklopfer@ifc.org

In Beijing:
Jing Yu
Phone: +86 10 5860-3098
E-mail: jyu1@ifc.org

Agreements Enable Long-term Financing for Development Projects in China

Beijing, China, November 23, 2011—IFC, a member of the World Bank Group, has entered into agreements with China Development Bank and the Export-Import Bank of China that will enable it to extend long-term Chinese renminbi loans, supporting projects that improve access to finance in rural areas, education, and health care for millions of Chinese.

By signing the National Association of Financial Markets Institutional Investors’ Master Swap Legal Agreements with the two banks, IFC becomes the first multilateral institution authorized to conduct transactions with Chinese financial institutions in the domestic local-currency swap market.

“Through this partnership with CDB and China Eximbank, IFC now adds an additional tool that enables us to extend long-term renminbi financing. This not only broadens the way we can fund projects but also strengthens our commitment to participating in the opening up of the China’s domestic capital markets,” said Jingdong Hua, IFC Vice President and Treasurer, who signed the agreements in Beijing.

IFC uses local-currency financing to help clients mitigate foreign-exchange risk and to develop local capital markets. It makes local-currency loans through the use of derivatives, issuing bonds in local currency, and through structured finance products such as partial credit guarantees and risk-sharing facilities. In partnership with international and domestic banks, IFC has committed over $7.4 billion in local-currency financing in more than 40 currencies.

“This initiative is another milestone for the IFC-China partnership,” said Sérgio Pimenta, Director for East Asia and the Pacific, IFC. “With our partner banks in China, it enables us to support key projects that are important to the country’s sustainable development.”  Earlier this year, CDB and China Eximbank became the first Chinese banks to participate in an IFC syndicated parallel loan for a project in Africa.

In East Asia, IFC has used local swap markets to provide loans to private sector companies in Indonesia, the Philippines, Thailand, and Vietnam.

About IFC

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit www.ifc.org.

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