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The New Bank and Private Sector Activities

The New Bank and Private Sector Activities. Lori Kerr Advisor, Vice Presidency for Private Sector and Non-Sovereign Guaranteed Operations Washington, DC October 15, 2008. Agenda. Background on IDB. New Business Model. Private Sector Operations. IDB’s Competitive Advantages.

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The New Bank and Private Sector Activities

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  1. The New Bank and Private Sector Activities Lori Kerr Advisor, Vice Presidency for Private Sector and Non-Sovereign Guaranteed Operations Washington, DC October 15, 2008

  2. Agenda Background on IDB New Business Model Private Sector Operations IDB’s Competitive Advantages Products for Private Sector Clients Consulting Opportunities Contact Information

  3. Inter-American Development Bank • Oldest and largest multilateral lender to Latin America and the Caribbean dedicated to accelerate economic and social development • Regional institution with 47 member countries, including 26 borrowing member countries • Established in 1959 • Provides US$10 billion annually in lending and technical assistance • Public sector operations • Private sector operations

  4. IDB: New Business Model • New corporate structure • Strengthened private sector operations • Broader client base • Expanded sectors • More agile and responsive

  5. IDB: New Business Model Public Private* PPP Mixed Sovereign- Guaranteed Operations • State Owned • Enterprises • without • Sovereign • Guarantee • (Federal, State, • Municipal • Basic • Infrastructure: • Transport • Energy • Water & San • Telecom Basic . Industries: Pulp Paper Chemical Steel Extractive Industries: Gas Oil Mining Manufacturing Tourism Agribusiness Services *Authorized up to 10% of IDB Outstanding Balance

  6. Private Sector Operations: IDB Group • The IDB Group, comprising the Inter-American Development Bank, the Inter-American Investment Corporation and the Multilateral Investment Fund, provides a wide range of financial and non-financial products and services to non-sovereign clients Inter-American Development Bank Structured and Corporate Finance Department Opportunities for the Majority

  7. IDB’s Competitive Advantages • Deep Knowledge and Excellent Relations with Latin America and the Caribbean • Oldest and largest multilateral lender to the Region • Cooperative, long-term relationship with member countries • Help mitigate political risks • Exemption from withholding taxes and de facto preferred creditor status • Solid Financial Position • AAA/Aaa Rating (S&P, Moody’s) • Authorized capital of US$101 billion • Ability to extend tenors at market pricing

  8. IDB’s Competitive Advantages • IDB Value-Added • “Umbrella Effect” helps to attract other lenders • Catalytic role: IDB financing mobilizes private investment • Internationally recognized environmental, social, labor and health standards provide comfort to governments, communities, lenders and sponsors • Flexible risk sharing arrangements

  9. Products for Private Sector Clients • A/B Loans • Political Risk Guarantees • Partial Credit Guarantees • Direct equity and quasi-equity investments • Investment funds • Technical assistance: • Renewable Energy (SECCI) • Infrastructure (InfraFund) • Water & Sanitation (Aquafund) • Other trust funds

  10. Phases in transaction cycle: Upstream feasibility Detailed due diligence Ongoing administration and monitoring Process of engagement: Request for proposals Proposal evaluation Consultant selection Consultant Services Agreement Consulting Opportunities • Areas of expertise: • Technical • Market • Financial • Economic • Environmental and Social • Insurance

  11. Contact Information • Structured and Corporate Finance Department (SCF) Large projects, enterprises and financial institutions • Phone: +1 (202) 623-3702 • www.iadb.org/scf • Opportunities for the Majority (OMJ) Market-based strategies to bring economic and social development to low-income populations • Phone: +1 (202) 623-2676 • www.iadb.org/OM • Inter-American Investment Corporation (CII) SMEs and financial institutions focused on SMEs • Phone: +1 (202) 623-3900 • www.iic.int • Multilateral Investment Found (MIF) Micro, small and medium enterprises • Phone: +1 (202) 942-8124 • www.iadb.org/mif

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