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Partial Credit GuaranteeBenefitsADB's Partial Credit Guarantee (PCG) can bridge the gap between the needs of the borrower and the constraints of the commercial lenders. Due to the perceived country and commercial risks, the lenders may not be willing to provide an uncovered loan with the financial terms required for the financial viability of the project. ADB provides comprehensive coverage for all commercial and political risks for a specified portion of the borrowing. The PCG usually covers debt service during the later maturities. This may be appropriate when lenders are not willing or able to provide a financing tenor long enough to match the cash flow of a project. Alternatively, PCGs can cover a portion of principal and interest payments payable throughout the term of a borrowing. AmountNo limit for Public Sector Projects with counter-guarantee or indemnity from the host government Single project exposure limits for Private Sector Projects without a counter-guarantee from the host government apply. Currently $75 million or 25% of project costs, whichever is less. This includes all of ADB's exposure to the project, including ADB's direct loan and/or equity investment. This limit is calculated on the present value of the amount guaranteed. InstrumentsThe PCG can be applied to loans, bonds, or floating rate notes. Such instruments are usually denominated in US dollars, Japanese yen, or Euros, but may be in local currencies. Fees
Eligible CofinanciersAny reputable commercial financial institution operating on a commercial basis is eligible. Case Studies
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