BRICS' New Development Bank headed by eminent Indian banker K V Kamath today held its first annual general body and board of governors meetings, landmark events for the exclusive bank of five emerging countries to finance development projects.
The opening ceremony of the bank held in Shanghai where the institution is headquartered was attended by China's Vice Premier Zhang Gaoli and Finance Minister Lou Jiwei among others.
India was represented by Raj Kumar, Joint Secretary in the Finance Ministry, and Indian Ambassador to China Vijay Gokhale.
The NDB was established with an initial subscribed capital of USD 50 billion with total paid-in capital of USD 10 billion.
The founding members of the NDB have already brought in capital of USD one billion as initial contribution.
The NDB announced its first batch of loans on April 16, providing USD 300 million to Brazil, USD 81 million to China, USD 250 million to India and USD 180 million to South Africa.
Speaking to the media after the first AGM, Kamath said the bank has issued its first loans this year worth about USD 911 million for projects in the BRICS member counties.
The bank was expected to provide substantial loans by next year, he said.
"I do not want put a number on the loans. It will be linked to capital. At this point of time we have little over a USD billion in capital. You can leverage two and half times to that," Kamath said, adding that the capital was expected to go up to USD two billion next year.
"We can lend substantial times. Numbers depend on project in pipeline," he said.
The bank also plans to extend finance to private sector.
"As a first step we are developing our own operational policies on that front (private sector) loans without sovereign guarantees; We have to build capacities in terms of people. It will take next six months to do that. Some time in the middle of the next year, I hope we will start looking at private sector projects in member countries. That will bring innovation," Kamath said.
The bank will also look at opportunities to co-finance projects with other Multilateral Development Banks, he said.
Ahead of the meeting, the NDB had issued its first bonds worldwide worth about USD 449 million to raise funds for clean energy projects in member states.
The five-year green bonds, denominated in the Chinese currency renminbi or yuan, are worth three billion yuan (USD 449 million) and were sold in China's onshore interbank bond market.
It was the first time in seven years that a global financial institution based in Shanghai issued the yuan- denominated bond in China.
Kamath had said the issuance was a milestone for the multilateral development bank.
The NDB was jointly founded by the BRICS countries in July 2014 and officially opened for business a year later.
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