WASHINGTON, Feb 17 — The World Bank, under pressure to do more to help developing countries cope with climate change, may change its internal lending guidelines to free up US$4 billion in lending capacity each year, World Bank President David Malpass told Reuters yesterday.
The IBRD in December raised its sustainable annual lending limit by US$2 billion, beginning in fiscal 2024, and Malpass said there could be scope for a further 8 per cent expansion in total IBRD lending. Its lending ceiling for fiscal 2022 was US$37.5 billion. The World Bank had long argued against changing its capital adequacy rules, worried that doing so would undermine its AAA credit ratings, but two of the three main agencies last year said some changes were possible without tarnishing the ratings.
Changing the bank’s current ratio is one of many recommendations contained in last year’s independent report prepared for the G20, which concluded that the World Bank and other multilateral development bank could increase their lending capacity by several hundreds of billions of dollar by reforming the way they operate.