- Region: Others
- Equity Investment
March 31, 2015
The Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Watanabe) signed an agreement on March 27 for equity participation in the IFC Financial Institutions Growth Fund, LP (the Fund), which invests in financial institutions in emerging countries. The fund is managed by IFC Asset Management Company, LLC, a wholly owned subsidiary of the International Finance Corporation (IFC).
The Fund is funded by IFC and governmental organizations of other countries together with JBIC at the first closing, and is to make investments in emerging countries' financial institutions such as banks and insurance companies. The target amount for the Fund to be raised is USD1 billion, and JBIC will contribute up to USD100 million in the Fund.
In 2009, JBIC participated as a founding partner with IFC in the IFC Capitalization Fund (Cap Fund)*1 with the purpose of stabilizing the international financial system after global financial crisis in 2008 by strengthening the capital bases of banks in emerging countries, and they played an important role in improving the governance and capital adequacy ratios of the investee banks. The Fund is positioned as a succeeding fund to the Cap Fund. JBIC aims to contribute to preventing instability of emerging countries' financial institutions and stabilizing the international financial system, through participation in the Fund with IFC.
As Japan's policy-based financial institution, JBIC will continue to contribute to preventing the disruption of the international financial system, in an effort to perform one of its functions: "Preventing disruptions to the international financial order or taking appropriate measures with respect to damages caused by such disruption," by drawing on its various financial facilities and programs including equity participation.
- *1 See the Press Release on February 2, 2009.