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Loans for IFC's Own Account: A-loans


 

IFC offers fixed and variable rate loans for its own account to private sector projects in developing countries.

 

Most IFC loans are issued in leading currencies, but local currency loans can also be provided. The loans typically have maturities of seven to 12 years at origination. Grace periods and repayment schedules are determined on a case-by-case basis in accordance with the borrower's cash-flow needs. If warranted by the project, IFC provides longer-term loans and longer grace periods. Some loans have been extended to as long as 20 years.


IFC operates on a commercial basis. It invests exclusively in for-profit projects in developing countries and charges market rates for its products and services. In FY13, IFC made commitments for nearly $8.5 billion in new loans, bringing the total committed loan portfolio to around $31.5 billion.

 

Loans from IFC finance both early-stage companies and expansion projects in developing countries. The Corporation also make loans to intermediary banks, leasing companies, and other financial institutions for on-lending. The credit lines are often targeted at small and medium enterprises or at specific sectors.


To ensure the participation of other private investors, A-loans are usually limited to 25 percent of the total estimated project costs for greenfield projects, or, on an exceptional basis, 35 percent in small projects. For expansion projects, IFC may provide up to 50 percent of the project cost, provided its investments do not exceed 25 percent of the total capitalization of the project company. Generally, loans for IFC’s own account range from $1 million to $100 million.

The Corporation is willing to extend loans that are repaid only from the cash flow of the project, without recourse or with only limited recourse to the sponsors.

 

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