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Development Bank of Japan Joins IFC Agreement to Simplify Loans in Developing Countries

Tokyo, Japan, January 12, 2010 —IFC, a member of the World Bank Group, and Development Bank of Japan have agreed to streamline the process for providing loans to companies in developing countries. The agreement will help address financing gaps in developing countries by minimizing duplication, shortening the time required to close transactions and reducing costs.
The accession agreement to IFC’s Master Cooperation Agreement will standardize the steps that Development Bank of Japan will take when joining IFC and other international financial institutions in co-financing projects related to environmental preservation or infrastructure development. Development Bank of Japan is the first Asian financial institution to participate in the arrangement. IFC signed the Master Cooperation Agreement with three European financial institutions in October 2009.
“Strengthening global business has been one of our core strategic goals since its privatization,” said Minoru Murofushi, President of Development Bank of Japan. “Partnering with IFC and other international financial institutions will help us enter new markets and provide new opportunities in developing countries to our customers.”
The global economic crisis has diminished commercial banks’ appetite for lending to projects in emerging markets. To help meet financing needs in times of crisis, IFC has developed a way to help clients obtain financing from international finance institutions more quickly through the syndication of parallel loans under its Master Cooperation Agreement.
The agreement helps participating institutions process deals more efficiently by enabling them to cooperate and use IFC’s existing syndication platform, deal-structuring expertise, and global presence to identify investments, perform due diligence, and negotiate loan documents.
“The Development Bank of Japan’s participation in the agreement will allow IFC and its partners to channel funding more quickly to where it is needed most, helping to close a gaping financing hole in developing countries as a result of the global financial crisis,’’ said Rashad Kaldany, IFC Vice President for East Asia and the Pacific.
IFC is the only international financial institution focused exclusively on the private sector, the engine of sustainable development in emerging markets. Along with IBRD , it is currently seeking a capital increase to strengthen its ability to create opportunity for the poor in developing countries—including by providing syndicated loans to the private sector in developing countries.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit www.ifc.org .
About Development Bank of Japan
Development Bank of Japan Inc. provides integrated finance products and related services to the private sector investments with total assets of JPY14.4 trillion ($142.8 billion). On October 1, 2008, Development Bank of Japan became a joint-stock company, taking a first step on the road to privatization after its 57 years of history as a policy-based finance intuition that had contributed to economic and social development of Japan. For more information, visit www.dbj.jp/en/index.html .