ADB Operations: ADB’s operations consist of ordinary and special operations:
- Ordinary operations are financed from ADB’s regular and concessional ordinary capital resources (OCR). Funding sources for OCR include paid-in capital, retained earnings (reserves), and proceeds from debt.
- Special operations are financed from special funds resources.
Approval: Approval of the project by ADB’s Board of Directors or the relevant ADB authority.
B Loans: A cofinancing arrangement involving funds from various sources provided to a single borrower or grant recipient with the risk shared among the loan providers.
Bilateral Cofinancing: Funds provided by governmental agencies within individual countries dedicated to advancing foreign policy goals while contributing to the economic and social development of recipient developing countries.
Cofinancing from Transaction Advisory Service (TAS): Amount of funding secured by a winning private partner, deemed as the amount of resource mobilization achieved through transaction advisory services of the Office of Markets Development and Public-Private Partnership.
Cofinancing or Financing Partnership: An arrangement whereby ADB and one or more partners jointly provide resources in the form of finance, risk-sharing capacity, or in-kind contributions to achieve common development objectives.
Commitment: The financing approved by ADB’s Board of Directors or Management for which the legal agreement has been signed by the borrower, recipient, or the investee company and ADB.
Financing Partnership Facility: A mechanism designed to mobilize and manage cofinancing from various development partners to support specific ADB corporate initiatives.
Global Fund: A global funding initiative for which an organization acts as its global trustee or administrator. A global funding initiative typically leverages a variety of public and private resources in support of international initiatives, enabling the development partner community to provide a direct and coordinated response to global priorities.
Grant: A sum of money provided to an ADB developing member country that does not need to be paid back and has the overall objective of promoting sustainable social and/or economic development.
Impact: The expected beneficial consequences measured 3-5 years after project completion.
Loan: A sum of money provided to an ADB developing member country or private company that is paid back with interest and has the overall objective of promoting sustainable social and/or economic development.
Multitranche Financing Facility: A flexible financing instrument that provides loan payments in stages, based on project readiness and the long-term needs of a client.
Multilateral Cofinancing: Funds provided by financial institutions established or chartered by more than one country to provide financial support and professional advice for economic and social development activities in developing countries.
Nonsovereign Cofinancing Ratio: The ratio of long-term cofinancing to NSO borrowers divided by private sector operations ordinary capital resources (net of risk transfers). Long-term cofinancing to NSO borrowers includes concessional funding, B-loans, parallel cofinancing, bonds and equity, risk transfers of ADB exposure to independent counterparties, the uncovered portion of loans and bonds guaranteed by ADB, and financing by third parties of projects that are closed following a PPP advisory mandate.
Nonsovereign Operations: Refers to any loan, guarantee, equity investment, or other financing arrangement that is (i) not guaranteed by a government; or (ii) guaranteed by a government under terms that do not allow ADB, upon default by the guarantor, to accelerate, suspend, or cancel any other loan or guarantee between ADB and the related sovereign (More information available in ADB Operations Manual on Nonsovereign Operations).
Official Cofinancing under Nonsovereign Cofinancing: Flowing mainly from financing partnerships with multilateral and bilateral development assistance agencies, official cofinancing mobilizes (i) grants, risk transfers, and loans for investment projects supported by ADB and (ii) grants for ADB’s technical assistance operations. Such cofinancing is usually sourced from official development aid. Consistent with ADB’s strategic directions and resource allocations, official cofinancing focuses on strong partner and client coordination for (a) easy access and efficiencies in processing, (b) low transaction costs, and (c) harmonized and transparent mechanisms in reporting to financing partners on the development impact of their contributions.
Outcome: The aims of the project as measured against the delivered outputs by the end of project implementation.
Output: The physical and/or tangible goods and/or services delivered by the project.
Parallel Cofinancing: Parallel Cofinancing is cofinancing provided by third party cofinanciers to a project alongside ADB. Parallel Cofinancing can either be a:
- Parallel loan, which is a third-party loan in transactions that have ADB’s direct loan or direct equity participation, and;
- Parallel equity, which is a third-party equity investment in (a) private equity fund where ADB is a general or a limited partner or (b) transactions where ADB makes a direct equity investment.
Partnership Framework Agreement: A framework that guides cofinancing and joint initiatives for a specific period. It covers a wide range of partnerships for better planning and coordination of joint cofinancing activities, including regional and subregional initiatives.
Project Specific Cofinancing: Mobilizes financing partners’ funding for individual projects.
Risk Transfer Arrangement: An agreement between ADB and an Eligible Counterparty under which, further to a legally binding guarantee, insurance policy, risk participation agreement or other similar contract, the Eligible Counterparty assumes a portion or all of ADB’s risk of loss occurring as a result of primary borrower default under one or more of ADB’s transactions.
Sovereign Cofinancing: Refers to resources provided by financing partners or third-party financing necessary to deliver the outcome in the design and monitoring framework of sovereign projects. ADB may fully or partially administer cofinancing, or not administer it at all (fully administered by the partner). ADB mobilizes cofinancing for technical assistance and investment projects (More information available in ADB Operations Manual on Financing Partnerships).
Special Funds: Funds as described in the ADB Charter established and administered by the Bank for special purposes.
Technical Assistance: A mode of ADB-support that facilitates the preparation, financing, and execution of development projects and programs. It helps developing member countries (DMCs) improve their capacities and make better use of their development resources.
Trust Fund: A managed account established by ADB for managing contributions from financing partners, with such contributions being administered by ADB in accordance with terms and conditions agreed with a financing partner(s).
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