5/18/2018 International Financial Corporation
1/42
1
InvestingforImpact
Capital Markets:Foundations for Long-Term Growt
!resentation to "ew #ork $niversit%&eptem'er ()* +)1,
ingdong .ua/ice !resident and Treasurer* IFC
5/18/2018 International Financial Corporation
2/42
+
Todays Presentation
Overviewof IFC
FinancialStrength
IFC in theCapitalMarkets
Contacts
2
5/18/2018 International Financial Corporation
3/42
(
5/18/2018 International Financial Corporation
4/42
,
5/18/2018 International Financial Corporation
5/42
0
verviewof IFCOverviewof IFC
5/18/2018 International Financial Corporation
6/42
2
verviewof IFCOverviewof IFC
5/18/2018 International Financial Corporation
7/42
3
IFC: A Me!er of the "orld #ank $ro%p
The World Bank Group is madeup of several distinct legal entities:
Overview of IFC
7
Bond issuers:
Non-issuers:
The World Bank Groups mandate is toend extreme poverty within ageneration and boost sharedprosperity
!" is a legall# distinct part of the WorldBank Group $ith its o$n articles of
agreement% &alance sheet and staff
!" is the largest global developmentinstitution focused on the privatesector%and the onl# glo&al multilateralsource of de&t and e'uit# financing forprivate enterprise
(ead'uartered in Washington )" $ithover 108 offices worldwide in 98countries
5/18/2018 International Financial Corporation
8/42
4
18 shareholders! governmentsof mem&er countries
*ppro+imatel#"#$ of capital isheld by %%%&%% sovereigns
,. of capital held G7
countries
!" does not pa# dividends orta+es
Strong Shareholder S%pport
/
We believe it is highly unlikely that the Corporation
would require shareholder assistance given the very
strong management of the resources it has on hand.However, given the shareholder support that the IFCenoys, along with its relatively modest si!e, it is likely
that shareholder governments would provide
additional capital well before any disruption in the
organi!ation"s ability to maintain operations would
occur.
'oody(s0 1 Novem&er 23
)nited *tates
1#9 other countries
Overview of IFC
+apan
Germany
,rance
)nited-ingdom
.ndia/ussia
anada
.taly
hina
etherlands
Belgium
%ustralia
*wit2erland
Bra2il
%rgentina
*pain
.ndonesia
*audi %rabia*outh -orea
'exico
3ene2uela
4akistan
*wedenigeria
5/18/2018 International Financial Corporation
9/42
5
&'() &'(* &')( &'*& 1984 &'+' ,--- ,--'
!" $asfounded 2#ears after theBretton Woods"onferencecreated theWorld Bank tofinance post-
WWreconstructionanddevelopment lending togovernments
!"4s firstinvestment: a52 million loanto help the6iemensaffiliate in Brailmanufactureelectrical
e'uipment
!" firsts#ndicationmo&ilies58% forBrailian pulpand papercompan#"hampion
"ellulose9 Theproect alsolaunches !"4ss#ndicationsprogram
!" creates a"apital ;arkets)epartment tostrengthenlocal &anks%stock markets%and otherintermediaries
!" &ecomesfinanciall#independentfrom the rest ofthe World BankGroup% gainingapproval toissue its o$n
&onds ininternationalcapital markets
*** "redit
5/18/2018 International Financial Corporation
10/42
1)
IFC: Creating Opport%nity
!"s vision is that people should have the opportunity to escape povertyand improve their lives9
!" creates opportunit# :
;o&iliing othersources of finance forprivate enterprisedevelopment
;o&iliing
=romoting open andcompetitive markets indeveloping countries
=romoting
6upporting companiesand other privatesector partners $herethere is a funding gap
6upporting
(elping generateproductive o&s anddeliver essentialservices to the poorand the vulnera&le
(elping
Overview of IFC
O i f C
5/18/2018 International Financial Corporation
11/42
11
5oans
67uity products
*yndicated loans
rade finance *tructured finance and
securitied products
/isk management products
5ocal currency financing
%ccess to finance
6nvironmental and socialsustainability
nvestment climate
=u&lic - private partnerships
nfrastructure advice
Whollyowned subsidiaryof ., founded in 21
nvests thirdparty capitalin a private e'uit# format
*llo$s outside e'uit#investors to &enefit from!"s e+pertise in achievingstrong e7uity returns as$ell as developmentimpact
Investment Services
IFCs Three #%sinesses
Advisory Services Asset ManagementCompany
589> &illionunder management
5793 &illion invested in 2>%5,97 &illion committed portfolio
over 52 millionin fee income annuall#
Figures for fiscal year ended 30 June 2014
Overview of IFC
Overview of IFC
5/18/2018 International Financial Corporation
12/42
1+
8otalloansande7uity
investments:)*;billions
>,
,
,,
6taff &ased in Washington )"
6taff &ased in countr# offices
Total ?oans and @'uit# nvestments committed as of fiscal #ear-end
O i f IFC
Overview of IFC
5/18/2018 International Financial Corporation
13/42
1(
., is a pioneer of socially and environmentally responsibleinvestments in emerging markets
*ll proects financed must adhere to .,(s stringent environmental andsocial re7uirements $hich cover transparenc# and accounta&ilit#% stipulatingspecific performance standards
!"s 67uator 4rinciplesis an esta&lished &enchmark for the financialindustr# to assess and manage social and environmental risk in proectfinancing
currentl# adopted / leading financial institutions%accounting for 1,. of proect finance transactions
$orld$ide
S%staina!ility: 1ey to IFCs Mission
Overview of IFC
3
IFC co-sponsors &ustaina'le 6anking 7wardswit te Financial Times
Overview of IFC
5/18/2018 International Financial Corporation
14/42
1,
FinancialStrength
Financial Strength
5/18/2018 International Financial Corporation
15/42
10
Conservative #alance Sheet
Financial Strength
In USD billions as of 30 June 2014
*ssets ?ia&ilities and "apital
,
Borrowings ; 9=#
>ther 5iabilities 10="
et Worth ?=0
=aid in "apital
29,
5/18/2018 International Financial Corporation
16/42
12
Consistent Asset $rowth
Financial Strength
IFCs fiscal year-end is 30June
8
)*Abillions
34%
66%
IFCs total disbursed loans and equity and net liquid assets at fiscal year!end
!C, !C8 !C7 !C/ !C1 !C !C !C2 !C3 !C>
,
,
2
2,
3
3,
>
>,
@'uit# nvestments ?oans and Dther )e&t ?i'uid *ssets
Financial Strength
5/18/2018 International Financial Corporation
17/42
13
Financial Strength
Organic $rowth fro 2etained 3arnings
IFCs fiscal year!end is 30 June7
)*Abillions
IFCs total net "ort# as of 30 June of eac# year
We e#pect IFC to be able to finance a large part of its
growth through internal capital generation, given its
profitable record.
*tandard 4oor(s C 3 *pril 23
!C, !C8 !C7 !C/ !C1 !C !C !C2 !C3 !C>
,
,
2
2,
3
5/18/2018 International Financial Corporation
18/42
14
;@@=8 billion of net li7uid assetsAe'uivalent to >. of total assets
Digh 7uality investments% $ith mainl#:
6overeign and supra &onds
Non-government triple-* fi+ed income securities !inancial institution deposits
=erformance is measured against market benchmarks $ithin riskparameters
4roactive investment approach focused on capital preservation%
reasona&le returns and diversification
.igh 4i5%idity
Financial Strength
/
$ur funding and liquidity ratios for IFC indicate that it
would be able to fulfill its mandate for at least one year,
even under e#tremely stressed market conditions,
without access to the capital markets.
*tandard 4oor(s C 3 *pril 23
Financial Strength
5/18/2018 International Financial Corporation
19/42
15
Track 2ecord of Pro6ta!ility
g
!" has recorded operating profit in ever# #ear since its founding in 1,8
1
)*;billions
%sian risisE/ussian risis
Bra2ilrisis
%rgentina risisEurkey risis
6' growth Global ,inancialrisis
6' growth Aeleveraging
!C11 !C !C !C2 !C3 !C> !C, !C8 !C7 !C/ !C1 !C !C !C2 !C3 !C>
9,
9,
2
29,
3
Dperating ncome
IFCs fiscal year!end is 30 June
Financial Strength
5/18/2018 International Financial Corporation
20/42
+)
)8
+08
0)8
308
1))8
2
Strong F%ndaentals
g
$ctual le%el figures as of 30 June 2014
&ini'u' and 'a(i'u' t#res#olds based on tri)le!$ rating 'et#odology guidelines as deter'ined by rating agencies
%percentage of estimated net cash
requirements for the ne#t & years'
)*Abillions
298+actualA
ebt
tonetworthE
times
*e%erage +is,!ad-usted ca)ital *iquidity ratio
>nly supranational withfully paidin capitalAheld e+clusivel# in E6 dollars !" has one of the lowest ratios of debt to net worthof an# supranational
!"s growth is financed by retained earnings
@'uit# investments are funded by .,(s net worth% not &orro$ings
onservative balance sheet:
)
1
+
(
,
297+actual
9)
90
91)
910
9+) 5298actual
5/9min
>9+ma+
7/.actual
>,.min
Financial Strength
5/18/2018 International Financial Corporation
21/42
+1
Consistent Triple7A 2ating
'aFor /atings onsiderations
;em&er of World Bank Group
6overeign sponsorship $ith fully paidin capital
6trong financial profile $ith su&stantial capital
and high li'uidit# "onservative statutor# and management policies
*s a multilateral development &ank% !" has a0$ risk weightingunder the Basel frame$ork
g
(he International Finance Corporation"s %IFC' )aa rating with a stable outlook is
based on its robust capital adequacy and liquidity, preferred creditor status, andstrong shareholder support.
'oody(s C 3 Novem&er 23
%aa?ong-term rating
ANovem&er 23
Dutlook: *table
%%%?ong-term rating
A*pril 23
Dutlook:*table
2
Financial Strength
5/18/2018 International Financial Corporation
22/42
++
B# compan#
;arket &ased loan pricing
6trong capital position% &acked economic capital frame$ork andleverage limits
?oans match-funded to manage
currenc#% interest rate andmaturit# risks
?imits on glo&al sectore+posure% and on ke# sectore+posure $ithin countries
@conomic capital-&asedlimits on countr# e+posure
Strict loan and equity )ortfolio di%ersification guidelines to reduce concentration ris,s.
Portfolio 2isk Manageent
5/18/2018 International Financial Corporation
23/42
+(
!" has de&t and e'uit# e+posurein 1?" countries andover ?E000companies
@'uit# investments comprise 3>.of !"s investment portfolio
.ighly 0iversi6ed $lo!alPortfolio
23
+egional )ortfolio di%ersification
6urope andentral %sia
?1$
*ub*aharan%frica1$
6ast %siaand the4acific
1"$
'iddle 6ast andorth %frica
11$
*outh %sia11$
Global ?$
Figures as of 30 June 2014
5atin %mericaand aribbean
??$
Financial Strength
5/18/2018 International Financial Corporation
24/42
+,2>
!ive largest countr# e+posuresaccount for @1$of total committedportfolio
Top ten e+posures comprise @$of total committed portfolio
?argest 2, e+posures comprise"$of !"s total committedportfolio
.igh 0iversi6cation of Portfolio !y Co%ntry
Figures as of 30 June 2014
Country )ortfolio di%ersification
)s a global institution, IFC*s geographic e#posure is
well diversified, both within countries and aggregating
e#posures at the country level.
*tandard 4oor(s C @0 %pril ?01@
.ndia9=1$
hina
"=0$
urkey"=?$
Bra2il#=$
/ussia=0$
'exico @=0$
igeria @=0$)kraine ?=0$
.ndonesia ?=0$
6gypt 1=9$olombia 1=8$
*outh %frica 1=$4eru 1="$
4akistan 1="$-enya 1="$
3ietnam 1=#$hile 1=#$
4hilippines 1=$%rgentina 1=$
+ordan 1=$Ghana 1=$
*erbia 1=?$/omania 1=?$
4anama 1=1$Bangladesh 1=1$
101 other countries@"=1$
Financial Strength
5/18/2018 International Financial Corporation
25/42
+0
.igh 0iversi6cation of Portfolio !y Ind%stry
!"s portfolio is highl#diversified across a wide rangeof industries and sectors
2,
Financial
Markets
29%
Funds
8%
rade
Finance!%In"rastructure
2#%
$il &as andMining
'%
elecommunications and.nformation echnology
$
'anufacturing1?$
%gribusinessand ,orestry
8$
onsumerand *ocial*ervices
8$
Figures as of 30 June 2014
Financial Strength
5/18/2018 International Financial Corporation
26/42
+2
/ of disbursed loan )ortfolio
?o$ N=?s F ?oans 8 da#s past due classified as non-accruing
@ntire portfolio revie$ed on a 'uarterl# &asis
Total reserves against losses e'ualed 891. A5981 &illion of the totaldis&ursed loan portfolio as of 3 une 2>
8%ality 4oan Portfolio
28IFCs fiscal year!end is 30 June
!C !C !C2 !C3 !C> !C, !C8 !C7 !C/ !C1 !C !C !C2 !C3 !C>
.
,.
.
,.
2.
2,.
non-accruing loans reserves
Financial Strength
5/18/2018 International Financial Corporation
27/42
+3
IFC: Providing 9al%e to Investors
Dnl# supranational institution $ithfully paid in capital
Well capitali2ed: capital and retainedearnings represent almost H3 of its total&alance sheet
mem&er countries
"onsistentl#rated %%%&%aa 6I= and ;ood#s
0$ risk weighting under Basel program
(as consistentl# recorded operating profits ever# #ear since its founding
in 1,8 %nnual funding program of )*;18 billion for the current fiscal #ear
ending 3 une 2,
27
We believe IFC benefits from strong access to capitalmarkets, bolstered by frequent issuance in many
markets and currencies. IFC has no callable capital,
unlike most -Is, so our ICs reflect our /aaa" 0tand
)lone Credit 1rofile.
*tandard 4oor(s 0 3 *pril 23
&*Is2 multilateral institutions IC+s. internal credit ratings
5/18/2018 International Financial Corporation
28/42
+4
IFC in theCapitalMarkets
IFC in the Capital Markets
5/18/2018 International Financial Corporation
29/42
+5
IFCs F%nding Strategy
., accesses a wide range of products to raise funding at favorable costand targeted maturity
!" e+ecutes its funding strateg# in three ke# $a#s:
21
1= 6stablishing a regular presence in its core markets
?= 6nsuring access to a wide range of markets to &enefit from opportunistic andcompetitivel# priced transactions
@= 4romoting development of emerging capital markets issuing &onds in localcurrencies% often in domestic markets
IFC in the Capital Markets
5/18/2018 International Financial Corporation
30/42
()
IBRD IFC IADB ADB EBRD AfDB
-;-
&+;- &*;(& !C,
5
5,
5
5,
52
1=
?=8
"=0
10=011=0 11=@
1?=81@=
1"=0
18=0
IFC in the Capital Markets
5/18/2018 International Financial Corporation
31/42
(1
F%nding in 9ario%s Markets and C%rrencies
3
!" has issuedglobal benchmarks ineach #ear since 2
!" complements its pu&lic issuance accessing a variet# of different marketssuch as green bondsE uridashiE privateplacements anddiscount notes
,irst nondomestic issuer in "hina%"osta
5/18/2018 International Financial Corporation
32/42
(+
$reen #onds
!" has pla#ed a pioneering role in
creating investment opportunities $hichsupport climate changerelated proFects
6ince its inaugural issue in 2% !" hasraised ;@= billion through its green &ondprogram% including the market(s first
benchmarksi2ed green bonds issued in!e&ruar# and Novem&er 23
!"s green &ond proceeds are held in aseparate account for investing e+clusivel#in renewable energyE energy efficientE
and other climatefriendly proFects Green &onds are consistentl# priced in line
with .,(s vanilla curve
32
IFC in the Capital Markets
5/18/2018 International Financial Corporation
33/42
((
#anking on "oen #onds
!"s Banking on Women &onds help
fund !"s Banking on Women program$hich supports womenowned smalland medium enterprises in emergingmarkets
Women entrepreneurs in developing
countries are a powerful source ofeconomic growth and opportunity
5/18/2018 International Financial Corporation
34/42
(,
Capital Markets: Fo%ndations for 4ong7Ter$rowth
)*A#"$
+4H#$
IA$
*trengthenstability
,inance growth)omestic and international investment flo$s closefinancing gaps for infrastructure% housing% 6;@s% etc9
Dffset the impact of capital flo$ volatilit#--lessonsfrom the 117 *sian financial crisis
.ntermediatecapital in an
economy
;o&ilie resources from investors and channelsavings into productive investments
IFC in the Capital Markets
5/18/2018 International Financial Corporation
35/42
(0
S%pporting Capital Markets: A Strategic Priorityfor IFC!" supports domestic capital market development through
ssuing local currenc# &onds
*dvice to regulators% authorities% and market participants
(elping first-time corporate issuers access capital markets
!" promotes access to local currenc# finance through
?oans
6$aps
"ustomied structured and risk management products
IFC in the Capital Markets
5/18/2018 International Financial Corporation
36/42
(2
IFC Capital Market Sol%tions Across the Spectr%
IFC in the Capital Markets
5/18/2018 International Financial Corporation
37/42
(3
IFC Pioneer Iss%ances in Capital Markets $lo!ally
37
Bra2il L %ma2onian Bond :?0073 8,
huaOifc9org
&anage'ent
%lexandra -lMpferCommunications $fficer
22 >73 >8>,
aklopferOifc9org
&edia
!" P 22 =enns#lvania *venue NW P Washington )" 2>33 E6* P 22 >73 /312
$e&site: ifc=org&investors P email: investorsNifc=org PBloom&erg: .,KG>O P NifcPinvestors
'onish 'ahurkar4irector(reasury arket $perations
22 >73 83>
mmahurkarOifc9org
>
-eshav Gaur5lobal Head
(reasury Client 0olutions
22 >73 83>
kgaurOifc9org
6lena 4anomarenko)dvisor
22 >73 /82epanomarenkoOifc9org
0eptember 6789
5/18/2018 International Financial Corporation
41/42
,1,1
5/18/2018 International Financial Corporation
42/42
,+
Disclaimer
Tis document as 'een prepared for informational purposes onl%* and te information erein ma% 'e condensed or
incomplete IFC specificall% does not make an% warranties or representations as to te accurac% or completeness of tesematerials IFC is under no o'ligation to update tese materials
Tis document is not a prospectus and is not intended to provide te 'asis for te evaluation of an% securities issued '% IFCTis information does not constitute an invitation or offer to su'scri'e for or purcase an% of te products or servicesmentioned $nder no circumstances sall IFC or its affiliates 'e lia'le for an% loss* damage* lia'ilit% or e;pense incurred orsuffered wic is claimed to ave resulted from use of tese materials* including witout limitation an% direct* indirect*special or conseInformation &tatement?* financial statements andoter relevant information availa'le at www.ifc.org/invesors
Top Related