World Bank Loan Agreements

(b) The Bank may contract the funds referred to in point (a)(ii) or guarantee the loans referred to in point (a)(iii) only with the consent of the Member in whose markets the funds are raised and only if those Members agree that the proceeds may be exchanged without restriction in the currency of another Member. 3. The variable margin in relation to the reference rate may be replaced by a fixed margin higher than the reference rate, but not the other way around. Such a “fixing” of the variable spread is based on the fixed spread that applies to the loan in effect at the time of application. The fixed difference of the converted loan shall consist of: the total amount of guarantees, loan participations and direct loans granted by the Bank may not be increased at any time if this increase exceeds one hundred per cent of the Unallocated Subscribed Capital, reserves and surplus of the Bank. The terms and conditions are incorporated by reference into all IDA loan, credit, guarantee, and grant and financing agreements. Specific provisions of the General Terms and Conditions will also be incorporated into other legal agreements. (i) In the case of loans granted in accordance with section 1 (a)(i), loan agreements shall provide that payments to the Bank shall take the form of interest, other charges and repayments in the currency borrowed, unless the Member whose currency is borrowed agrees that such payments shall be made in one or more other specified currencies. Subject to Article II(9)(c), such payments shall be equal to the value of those contractual payments at the time the loan is granted in a currency determined by the Bank by a three-quarters majority of the total voting rights for that purpose. (a) The Bank shall take the necessary measures to adjust the obligations arising from the loans, including those which correspond or correspond to the provisions laid down in section 4 (c). (iii) guaranteeing, in whole or in part, loans granted by private investors through the usual investment channels. In the case of direct loans referred to in Section 1 (a)(i) and (ii) of this Article, the following provisions shall apply: (e) currencies subscribed on the markets of the borrowers` members for loans guaranteed by the Bank in accordance with Section 1(a)(iii) shall also be used or exchanged by those members in other currencies without restriction.

To apply for a credit conversion, borrowers should refer to the Bank`s Banking Directive and the Bank`s Conversion Guidelines and complete the relevant conversion forms below and send them to loanclientservices@worldbank.org. (d) The Bank may, in exceptional circumstances, at the request of a Member in whose territory part of the loan is issued, redeem part of the currency of that Member so issued in gold or foreign currency; in no case may the part so redeemed exceed the amount by which the expenditure of the loan in these territories entails an increased need for foreign currency. (d) all other currencies available to the Bank, including currencies placed on the market or otherwise borrowed in accordance with Article 1(a)(ii), currencies obtained through the sale of gold, interest payments and other expenses for direct loans referred to in Section 1(a)(i) and (ii) and currencies received in payment of commissions and other charges referred to in Section 1(a)(iii); are used or exchanged without restriction by members whose currencies are offered for other currencies or gold required for the Bank`s activities. (c) Where a Member suffers from an acute exchange rate strain so that the service of a loan contracted by that Member or guaranteed by that Member or by one of its agencies cannot be provided in the manner envisaged, the Member concerned may request the Bank to relax the terms of payment. If the Bank is satisfied that some flexibility is in the interest of the Member concerned and of the activities of the Bank and its Members as a whole, it may take action for all or part of the annual service in accordance with one or both of the following paragraphs: Note: Variable Dispersion IFL in accordance with the General Terms and Conditions of 31. July 2010 or earlier require an amendment to the loan agreement to set and abolish the reference rate or to apply a cap or collar for the reference portion of the loan rate while maintaining the variable spread. (ii) granting or participating in direct loans from funds raised on a Member`s market or otherwise contracted by the Bank. (b) In exceptional circumstances, where the national currency required for the purposes of the loan cannot be borrowed by the borrower on reasonable terms, the Bank may make available to the borrower a reasonable amount of that currency as part of the loan.

(i) granting or participating in direct loans from their own resources corresponding to their impaired paid-up capital and surplus and, subject to Section 6 of this Article, to their reserves. (b) the Bank shall arrange for the proceeds of a loan to be used only for the purposes for which the loan was granted, taking due account of economic and efficiency considerations and without taking into account political or other non-economic influences or considerations; The interest rate consists of a market-based variable reference rate and a spread (variable or fixed). A one-time initial fee of 0.25% is charged on the amount of the loan committed, and a commitment fee of 0.25% per year, paid semi-annually, is levied on undisbursed balances incurred sixty days after the signing of the loan agreement. Countries are divided into four price groups based on income and other factors. Please refer to the IBRD Flexible Loan PRICING Basics Note for information on IBRD loan rates and fees in USD, EUR, JPY and GBP or view our loan rates and fees. Thank you for participating in this survey! Your feedback is very helpful to us as we work to improve the functionality of the website on worldbank.org. (a) The terms of payment of interest and principal, the due date and the payment dates of each loan shall be determined by the Bank. The Bank shall also determine the interest rate and any other commission conditions to be calculated in connection with such a loan. In the case of loans granted in accordance with Article 1(a)(ii) during the first ten years of operation of the Bank, that commission rate shall be at least one percentage per annum and shall not exceed one and a half per cent per annum and shall be deducted from the unpaid part of that loan. At the end of that ten-year period, the rate of commission may be reduced by the Bank both for the outstanding parts of loans already granted and for future loans if the reserves established by the Bank in accordance with Section 6 of this Article and other revenue derived therefrom are considered sufficient to justify a reduction.

In the case of future loans, the bank is also free to increase the commission rate beyond the aforementioned limit if experience has shown that an increase is desirable. The IFL includes conversion options to manage foreign exchange and/or interest rate risks over the life of the loan. These options are anchored in the loan agreement and can be executed at any time at the request of a borrower. In accordance with the requirements of their debt management strategy or changing market conditions, IFL borrowers have the option to switch from a variable interest rate to a fixed interest rate or vice versa. The IFL also offers the possibility of using interest rate caps or collars to manage interest rate volatility. Similarly, IFL offers a currency conversion option for hard currencies as well as for some local currencies. (c) currencies received by the Bank from borrowers or guarantors in payment of the principal amount of direct loans granted by the Bank in accordance with Article 1(a)(ii) shall be held and used without restriction by Members to make principal payments or to anticipate the payment or redemption of some or all of the Bank`s obligations. (a) The Bank may grant, participate in or guarantee loans to the International Finance Corporation, a subsidiary of the Bank, for use in its lending operations. The total outstanding amount of such loans, participations and guarantees may not be increased if, at that time or accordingly, the total amount of the debt (including the guarantee of debts) contracted by the said company from any source whatsoever and then in progress exceeds an amount equal to four times its unallocated subscribed capital and its surplus. (b) Article III(4) and (5)(c) and Article IV(3) shall not apply to loans, participations and guarantees approved under this Section. (ii) The Bank may change the terms of repayment or extend the term of the loan, or both. .