The Inter-American Development Bank (IDB), a US-based multilateral finance institution that operates in Latin America and the Caribbean, has established a “Flexible Financing Facility” (FFF) that will give Latin American and Caribbean countries flexibility in loan terms and conditions as well as allowing the use of hedges to manage interest rate and currency risks associated with loans from IDB [1].

IDB CFO Edward Bartholomew stated, “Countries’ financial needs frequently change during the life of our loans. These flexible financing solutions will allow our sovereign borrowers to better manage risks, whether at a project level, in their broader lending programs or as part of comprehensive asset and liability management strategies” [1]. 

FFF will become fully operational on January 1, 2012, and will replace the current platform for approval of guaranteed loans from “Ordinary Capital,” IDB’s current principal source of lending [1]. IDB reported total assets of USD 84 billion as of December 31, 2009.

By: Alexandra Pattee, Research Associate

About Inter-American Development Bank (IDB): The Inter-American Development Bank (IDB) is a US-based multilateral finance institution established in 1959 that operates in Latin America and the Caribbean. IDB works with governments, companies and nongovernmental organizations (NGOs) to provide both loans and grants to support small and medium-sized enterprises (SMEs), health, education and other sectors. IDB also provides technical assistance and research in these areas. Its Board of Executives is elected by 48 member countries, 26 of which are located in Latin America and the Caribbean. IDB reported total assets of USD 84 billion as of December 31, 2009.

Sources and Resources:

[1] Inter-American Development Bank (IDB) Press Release, “IDB establishes Flexible Financing Facility for borrowing countries”, http://www.iadb.org/en/news/news-releases/2011-05-06/idb-creates-flexible-financing-facility,9357.html

MicroCapital.org Article, March 28, 2011. “Inter-American Development Bank (IDB), Association of Supervisors of Banks of the Americas (ASBA) Publish “Guidelines of Principles for Effective Regulation and Supervision of Microfinance Operation” in Support of Transparency and Client Protection”, http://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-association-of-supervisors-of-banks-of-the-americas-asba-publish-guidelines-of-principles-for-effective-regulation-and-supervision-of-mic/

MicroCapital.org Article, March 3, 2011, “In Partnership with Blue Orchard and responsAbility Social Investments AG, Inter-American Development Bank (IDB) Syndicates $40m to Banco Continental of Paraguay to Support Small and Medium-Sized Enterprises (SMEs)”, http://www.microcapital.org/microcapital-brief-in-partnership-with-blue-orchard-and-responsability-social-investments-ag-inter-american-development-bank-idb-syndicates-40m-to-banco-continental-of-paraguay-to-support-small-a/

MicroCapital.org Article, February 28, 2011, “Inter-American Development Bank (IDB), Oikocredit, Incofin, Calvert Foundation Make Syndicated Loan of $9m to Cooperativa de Ahorro y Credito (COAC) Jardin Azuayo of Ecuador”, http://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-oikocredit-incofin-calvert-foundation-make-syndicated-loan-of-9m-to-cooperativa-de-ahorro-y-credito-coac-jardin-azuayo-of-ecuador/

MicroCapital.org Article, January 12, 2011, “Inter-American Development Bank’s Multilateral Investment Fund Makes Local-Currency Debt Investment Worth $1.6m to Fondo Esperanza of Chile and Haitian Credit Unions Caisse Populaire Marigot, Caisse Populaire Kotelam, Caisse Populaire Fraternite”, http://www.microcapital.org/microcapital-brief-inter-american-development-banks-multilateral-investment-fund-makes-local-currency-debt-investment-worth-1-6m-to-fondo-esperanza-of-chile-and-haitian-credit-unions-caisse-popula/

MicroCapital.org Article, January 12, 2011, “Inter-American Development Bank (IDB) Makes $4m in Equity Investments in Solutiones de MicroFinanzas SA (Microserfin) of Panama, Banco ProCredit Honduras, enConfianza Microfinanciera of Mexico and $3.5m in Loans to Fondo de Desarrollo Regional (Fondesurco) of Peru, IFD Sembrar Sartawi of Bolivia”, http://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-makes-4m-in-equity-investments-in-solutiones-de-microfinanzas-sa-microserfin-of-panama-banco-procredit-honduras-enconfianza-microfinancie-2/

MicroCapital.org Article, December 29, 2010, “Inter-American Development Bank (IDB) Arranges $22m Syndicated Loan to Banco Pichincha of Ecuador for Housing, Microfinance, SME Lending”, http://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-arranges-22m-syndicated-loan-to-banco-pichincha-of-ecuador-for-housing-microfinance-sme-lending/

MicroCapital.org Article, October 22, 2010, “Microfinance Information Exchange (MIX) and Inter-American Development Bank’s Multilateral Investment Fund Release “2010 Microfinance Americas: The Top 100″”, http://www.microcapital.org/microcapital-brief-microfinance-information-exchange-mix-and-inter-american-development-banks-multilateral-investment-fund-release-?2010-microfinance-americas-the-top-100?/

MicroCapital.org Article, August 23, 2010, “Inter-American Development Bank (IDB) to Provide $5m Partial Credit Guarantee to Mexican Microfinance Institution Agrofinanzas for Supply Chain Financing”, http://www.microcapital.org/microcapital-brief-inter-american-development-bank-idb-to-provide-5m-partial-credit-guarantee-to-mexican-microfinance-institution-agrofinanzas-for-supply-chain-financing/

MicroCapital’s Microfinance Universe: Inter-American Development Bank (IDB), http://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Inter-American+Development+Bank+%28IDB%29

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