World Bank

1. WORLD
BANK
Presented by :
Pawan Singh Raikhola
B.M.S-M.B.A Integrated
5th Semester

2. WORLD BANK
• The World Bank is a component of the World bank group.
• The World Bank is an international financial institution that provides financial
and technical assistance to developing countries for development programs
(Example: construction of bridges, roads, schools etc.)with the stated goal of
reducing poverty.
• World bank provides low-interest loans, interest-free credit and grants to
developing countries. Unlike other financial institutions, world bank does not
operate for profit.
• It comprises two institutions: the international bank for reconstruction and
development (IBRD), and the international development association(IDA).

3. About world bank
• Motto: Working for a World Free of Poverty.
• Formation: July 1945; 73 years ago
• Type: Monetary International Financial
Organization
• Headquarters: Washington, D.C., U.S.
• Membership: 189 countries (IBRD)
173 countries (IDA)
• Key people: Jim Yong Kim (President)
• Parent organization: World Bank Group

4. History
• The world bank was created at the 1944 Bretton woods conference along with the
international monetary fund (IMF).
• The conference, formally known as the united nations monetary and financial
conference, was the gathering of 730 delegates from all 44 allied nations at the mount
Washington hotel ,to regulate international monetary and financial order after the 2nd
world war.
• 1944-1974:
before 1974, the loans which has been provided is relatively small. And the loan
application had to meet strict criteria.the first country to receive a world bank loan was
france. In 1960 the international development association was formed , providing soft
loans to developing countries.

5. • 1974-1980
From 1974-1980 the bank concentrated on meeting the basic needs of people in the
developing world. The size and number of loans to borrowers was greatly
increased as loan targets expanded from infrastructure into social services and
other sectors.
• 1980-1989
During the 1980s the bank emphasized lending to service sectors
and structural adjustments policies designed to develop the economies of
developing nations.
• 1989-present
The bank began including environmental groups and NGOs in its loans to
mitigate the past effects of its development policies that had prompted the
criticism. And also working in different areas to promote good health and other
criteria.

6. World Bank Group
The World Bank Group is a group of five international organizations. The World Bank Group gives advice
and finance to member countries for economic development and reducing poverty. It is a non-profit-
making international organization owned by member governments.
The world bank group is made of following five organization:
1. The International Bank for Reconstruction and Development (IBRD) 1945.
2. The International Finance Corporation (IFC)1956.
3. The International Development Association (IDA) 1960.
4. The Multilateral Investment Guarantee Agency (MIGA)1988.
5. The International Centre for Settlement of Investment Disputes (ICSID)1966.

7. International bank for reconstruction
and development
• Formed in 1944.
• IBRD is a global development cooperative owned by 189 member countries. As
the largest development bank in the world, it supports the World Bank Group’s
mission by providing loans, guarantees, risk management products, and advisory
services to middle-income and creditworthy low-income countries.
• Created to help Europe rebuild after World War II, IBRD joins with I.D.A., for
funding the poorest countries, to form the World Bank. They work closely with
all institutions of the World Bank Group and the public and private sectors in
developing countries to reduce poverty and build shared prosperity.

8. How IBRD Financed
• IBRD raises most of its funds from the world's financial markets.
• This has allowed it to provide more than $500 billion in loans to poverty around
the world with its member countries paying about $14 billion in capital.
• IBRD has maintained a triple-A rating since 1959.
• IBRD earns income every year from the return on its equity and from the small
margin it makes on lending.

9. International development
association
• Formed in 1960
• Purpose is to reduce poverty and development assistance.
• Member countries 173.
• IDA is the second world bank institution and its main focus is helping the poorest
countries in the world by boosting there economy.
• It help around 123 million children to get better water sources and 65 million
people receive health services

10. International Development
Association(continued…)
• The International Development Association (IDA) is an international financial
institution which offers concessional loans and grants to the world's poorest
developing countries.
• It is also known as the soft loan window of world bank. IBRD and IDA collectively
work for achieving the goal of world bank.
• IDA lends money on concessional terms. This means that IDA credits have a zero
or very low interest charge and repayments are stretched over 30 to 38 years,
including a 5- to 10-year grace period.
• The lending terms are determined with reference to the countries risk of debt,
the level of there income, and creditworthiness.

11. International financial corporation
• Established in 1956.
• Has 184 member countries.to join IFC a country must be a member of IBRD.
• It offers investment, advisory and assistance to encourage private sector development
in developing countries.It work with private sector in developing countries to create
market that open up opportunities for all.
• The largest global development institution focused exclusively on the private sector in
developing countries. The Bank Group has set two goals for the world to achieve by
2030: end extreme poverty and promote shared prosperity in every country.
• Services provided:
loan, equity , advisory , asset management etc.

12. Multilateral investment guarantee
agency (MIGA)
• MIGA was founded in 1988.
• Member countries are 181.
• MIGA is a member of world bank group. It promote cross border investment in developing
countries by providing guarantees to investors and lenders.(political risk insurance and credit
enhancement )
• Its guarantee protect investment against non-commercial risks and can help in investors obtain
access to funding sources with improved financial terms and conditions.
• The agency generally offers insurance coverage lasting up to 15 years with a possible five- year
extension depending on a given project’s nature.
• Small and medium enterprises may take advantage of discounted insurance.

13. International centre for settlement of
investment disputes(ICSID)
• Formed in 1966.
• Member countries 156.
• ICSID is an international arbitration institution.(to resolve dispute out side the court) It
is for legal dispute resolution and conciliation between international investors.
• Its availability to investors and states helps to promote international investment by
providing confidence in the dispute resolution process.
• ICSID also promotes greater awareness of international law on foreign investment.

14. Criteria
• Reduce extreme poverty and hunger.
• Achieve universal primary education.
• Promote gender equality.
• Reduce child mortality.
• Improve maternal health.
• Awareness about communicable diseases.
• Ensure environmental sustainability.
• Development of infrastructure.

15. Functions of world bank
• Provides loans : it can be for short term or medium term.
1. reconstruction loans.
2. development loans.
• Provides technical advice to the borrowers.
• Help in funding.
• Provide guarantee for loan granted to small and large unit and other projects of
member countries.
• Mostly work for undeveloped countries. The bank provide long term loan for various
development project of 5 to 20 year duration.

16. Operations
• Fund generation:
IBRD : lending to developing countries is financed by selling AAA-rated
bonds.
IDA : provide interest free loan.
• Loans :
reconstruction loan
development loan
• Grants :
related to the water supplies,
improve sanitation,
rebuild the economy.
• Advisory services:
poverty assessment
how to use fund

17. Board of directors
• Board of directors are 24.
• They are elected for two years
• 5 from USA , Japan , Germany ,France and Britain.
• 19 directors represent the rest of the nation.
• Under the IBRD Articles of agreement, each of the five member having the largest
number of share appointed an executive directors

18. How is world bank run ?
• The world bank is like a cooperative, where its 189 member countries are
shareholders. The shareholder are represented by a board of governors, who are
ultimate policy maker at the world bank
• The governor are member countries ministers of finance or ministers of
development.
• Meeting held once in a year i.e. annual meeting.
• There are 24 executive directors, who work on the site at the bank.
• The executive directors make the board of directors.

19. Largest share holders
Share holder Voting power
united state 16.41 %
Japan 7.87%
Germany 4.49%
The united kingdom 4.31%
France 4.31%

20. Thank you