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  • Alphabet Soup of International Financial Institutions Look at your index card and can you tell me what acronym you have?

Transcript

  • 1.  
  • 2. DEFINITION
    • IFI refers to financial institutions that have been established by more than one country.
    • The most prominent IFIs are creations of multiple nations, although some bilateral financial institutions.
  • 3. INTERNATIONAL FINANCIAL INSTITUTIONS
    • World Bank
    • IMF
    • Asian Development Bank
    • International Finance Corporation
  • 4. World Bank
    • Established July 1, 1944
    • WB Group consist of
      • International Bank of Reconstruction & Development
      • International Development Agency
      • International Financial Corporation
      • Multilateral Investment Guarantee Agency
      • International Center for Settlement of International Dispute
    Norwegian Delegation, Bretton Woods, July 1944
  • 5. WORLD BANK
    • 185 COUNTRY
    • The five largest shareholders France, Germany, Japan, UK and US .
    • Low-interest loans
    • Interest - free credits .
    • Grants to developing countries
    • Financial & Technical Assistance.
  • 6. World Bank ( IBRD )
    • IBRD or International Bank for Reconstruction & Development or World Bank was established in 1947.
    • ::: Objectives Of IBRD:::
    • The original objective was to make loans to develop the war shattered economies of Europe in the Second World War.
    • To promote investment by means of guarantee and participation in loans and other investments made by private investors.
    • To provide loans to big projects
    • To help the poor countries by providing them loans and information assistance.
  • 7. World Bank ( IBRD )
    • ::Sources of IBRD::
    • Quotas: The membership of the world is the same as that of IMF. Members make contribution in relation to their IMF Quota.
    • Bonds: The World Bank also sells Bonds in the capital markets to raise funds.
    • Income: A very small proportion of the IBRD funds come from the interest on loans advanced by it.
  • 8. IMF…International Monetary Fund
    • Establishment: it was the outcome of Wood Agreement signed by 44 major countries of the world in July 1944 in USA.
    • Organization: It is an autonomous body and is affiliated to UNO. The management of Fund is under control of two bodies:
    • a) Board of governor, b) Board of Executive directors
  • 9. IMF…International Monetary Fund
    • a) Board of governor: it formulates the general policies of the Fund
    • b) Board of Executive directors: it is responsible for the day to day activities of the Fund.
    • Membership: All those counties which agree to subscribe to Funds Article of Agreement are eligible to Funds Membership. The membership of Fund has risen from 44 nations to 183 now.
  • 10. IMF…International Monetary Fund
    • Quotas: Each member has to contribute a quota to fund. The size of the quota depends upon the national income and share in international trade of that country. The quota is made up of 75 % in the country's currency and 25 % in gold.
  • 11. IMF…International Monetary Fund
    • ::Functions of IMF::
    • Maintaining exchange stability among the members countries
    • Borrowing: The credit facility has been raised up to 45 % of one’s quota over a three years period.
    • Correcting Balance of Payment (A balance of payments (BOP) sheet is an accounting record of all monetary transactions between a country and the rest of the world. These transactions include payments for the country's exports and imports of goods, services )
    • Interest charges: It charges interest on the credit provided to member countries.
  • 12.
    • 5) Technical Assistance: it helps the members by providing the services of specialist and experts in concerned fields.
    • 6)Compensatory Finance Scheme: if a member is facing difficulty in receipt of export credit, the IMF can give loan to member with few conditions.
    • 7) The extended Fund Facility: For the assistance of correcting the balance of payments of the member countries, introduced in 1974 by IMF
    • 8) The Supplementary Financing Facility: This scheme was introduced in 1979 in order to give long term loans to less developed counties
  • 13.
    • 9.Increasing international monetary co-operation.
    • 10.Promoting the growth of trade.
    • 11.Promoting exchange rate stability.
    • 12.Establishing a system of multilateral payments member countries.
    • 13.Building reserve base.
    • 14.Funding facilities.
  • 14. Asian Development Bank
    • It was established on December 4, 1966 with an authorized capital of 58 billion dollars.
    • The purpose of its formation was to lend funds, promote investment and provide technical assistant to the countries mainly in Asian region.
    • :::Features::::
    • It is an Asian Bank
    • Its membership is now extends beyond the Asian countries. It has 16 non.regional donor nations led by USA. The total number of members are now 55
  • 15. Asian Development Bank
    • This was emerged as a result of the “Economic Commission For Asia and Far East” held in Manila in December 1963.
    • It was decided that the capital formation in the developing countries is not possible through domestic savings only and capital should be made available to the low income countries by establishing a bank.
  • 16. Asian Development Bank
    • :::: Functions:::::
    • Provide loans to low income countries.
    • Promote investments in private as well as in public sector.
    • Help the member counties in foreign trade.
    • It provides technical assistance for preparation, financing and execution of development projects.
    • It also helps the UNO in various projects ( But in rare cases )
  • 17. Asian Development Bank
    • :::: Organization::::
    • The bank has a Board of Governors, Board of Directors, a President and a vice President.
  • 18. International Finance Corporation
    • Established in 1956, IFC is the largest multilateral source of loan and equity financing for private sector projects in the developing world. It promotes sustainable private sector development primarily by:
    • Financing private sector projects and companies located in the developing world.
    • Helping private companies in the developing world mobilize financing in international financial markets.
    • Providing advice and technical assistance to businesses and governments.
  • 19. International Finance Corporation
    • The International Finance Corporation ( IFC ) promotes sustainable private sector investment in developing countries.
    • IFC is a member of the World Bank Group and is headquartered in Washington, DC. It shares the primary objective of all World Bank Group institutions: to improve the quality of the lives of people in its developing member countries.
  • 20. International Finance Corporation
    • IFC has 182 member countries , which collectively determine its policies and approve investments. To join IFC, a country must first be a member of the International Bank for Reconstruction and Development (IBRD). IFC's corporate powers are vested in its Board of Governors, to which member countries appoint representatives.
  • 21.
    • Its main function is to provide finance for industrial projects to the private enterprises in developing countries.
    • The loan is repayable in a period of 5 to 15 years.
  • 22.
    • THANK YOU