Authorized and subscribed capital stock amounted to $56.0 billion. ADB raised funds totaling $8.9 billion, of which $2.0 billion was raised through two US dollar global public offerings. Ordinary capital resources (OCR) gross income, which includes revenue and net realized gains, amounted to $2.2 billion, $1.4 billion of which was generated from the loan portfolio, $680.4 million from the investment portfolio, and $104.5 million from other sources, of which $80.7 million came from equity investment operations.
ADB’s Special Funds are the Asian Development Fund (ADF) with 2007 committed resources amounting to $0.6 billion, Technical Assistance Special Fund of $14.4 million, Japan Special Fund of $39.7 million, ADB Institute Special Fund of $11.8 million, Asian Tsunami Fund of $22.6 million, Pakistan Earthquake Fund of $22.6 million, and Regional Cooperation and Integration Fund of $41.2 million.
FUNDING
ADB raised funds totaling $8.9 billion, of which $2.0 billion was raised through two US dollar global public offerings.
OVERVIEW OF OPERATIONS
ADB approved 96 loans (82 projects) for $10.1 billion, 5 equity investments for $79.8 million, 4 guaran-tees for $376.0 million, 2 syndication operations for $425.0 million, 39 grant projects for $672.7 million, 242 technical assistance projects for $243.4 million, and 7 multitranche financing facilities for $4.0 billion.
LOANS
Sovereign lending amounted to $9.2 billion (Table 4) for 74 loans (61 projects and programs), comprising 38 loans from ADB’s OCR for $7.4 billion, and 36 loans from the ADF for $1.9 billion. These amounts include 15 OCR loans for $2.0 billion and three ADF loans for $50.0 million from multitranche financing facilities. Overall, sovereign lending increased 36% over the $6.8 billion approved in 2006 (an increase of 33% for OCR lending and increase of 49% for ADF lending). Three nonsovereign public sector loans to state-owned enterprises for $105.0 million were approved. Nineteen nonsovereign loans (19 projects) to the private sector for $760.3 million were also approved—79% more than the $425.0 million for seven loans (six projects) in 2006.
Of the 82 projects and programs approved in 2007, 62 (76%) were general interventions, and 20 (24%) were targeted interventions. Sustainable economic growth was the most prevalent theme and was associated with 71 projects. Transport and communications, among the sectors, received the largest share of lending (39%) (Table 5).
The 71 projects approved in 2007 will result in total investments of about $17.3 billion: $7.8 billion (45%) will be financed by ADB; $4.2 billion (24%) by governments and borrowers; $5.3 billion (30%) by cofinanciers, equity sponsors, and local financial institutions; and $111.2 million (1%) by project beneficiaries. Five projects amounting to $503.2 million will be financed under sector lending, compared with four projects amounting to $314.2 million in 2006.
The 11 policy-based programs approved in 2007 were valued at $2.5 billion, compared with 15 programs for $3.1 billion in 2006. Three program loans approved in 2007 were coupled with an investment project loan or a technical assistance loan.
Transport and communications received the largest share of lending
Sustainable economic growth was the most prevalent theme
EQUITY OPERATIONS
Five equity investments for $79.8 million were approved in 2007, compared with 13 for $250.5 million in 2006.
COFINANCING AND GUARANTEE OPERATIONS
Total direct value-added cofinancing amounted to $1.1 billion for 78 projects, of which $1.0 billion was for 18 investment projects and $89.7 million was for 60 technical assistance projects. Direct value-added cofinancing for investment projects comprised $376.0 million for 4 guarantee operations, $425.0 million in B-loans for 2 projects, $101.4 million for 10 grant operations, and $120.5 million for 6 official loan cofinancing operations (Tables 6a and 6b). Nondirect value-added cofinancing amounted to about $2.2 billion in the form of parallel grants and loans for 11 ADB-financed projects and programs.
In 2007, Australia, Norway, and the Netherlands committed a total of $56.5 million to the innovative Water Financing Partnership Facility, or more than 50% of the original target of $100.0 million by the end of 2008. ADB started to manage the Asia Pacific Carbon Fund to acquire future flows of certified emission reduction credits on behalf of participants, in return for up-front cofinancing payments. By the end of 2007, a total of $151.8 million had been remitted to this fund through Instruments of Contributions from Belgium, Finland, Luxembourg, Portugal, Spain, Sweden, and Climate Cent Foundation. Two new facilities were established: the Clean Energy Financing Partnership Facility, with contributions of $5.9 million from Australia and $5.6 million from Norway; and the Regional Cooperation and Integration Financing Partnership Facility.
ADB agreed with Japan on a strategic partnership called Enhanced Sustainable Development in Asia (ESDA) to improve investment climates, including regional cooperation and energy efficiency, in Asia. Under the ESDA framework, the Japan Bank for International Cooperation, through the Accelerated Co-Financing scheme with ADB (ACFA), agreed to provide concessional yen loans for an aggregate $1 billion–$2 billion over the next 5 years to jointly cofinance ADB projects. Japan also established two trust funds linked to the new financing partnership facilities: the Asian Clean Energy Fund and the Investment Climate Facilitation Fund. The first ADB project under ACFA was approved with a loan of $38 million for the Power Sector Expansion Project in Samoa.
GRANTS
ADB approved 39 grant projects for $672.7 million in 2007 (Table 7). Of this amount, $519.3 million was funded from ADF IX; $30.0 million from the Pakistan Earthquake Fund; and $123.4 million from external sources with full or partial administration by ADB, comprising $22.0 million from the Japan Fund for Poverty Reduction, and $101.4 million from other bilateral and multilateral sources (Australia, Canada, Finland, France, Norway, European Commission, Global Environment Facility, HIV/AIDS Cooperation Fund).
Of the 39 grant projects, sustainable economic growth was the most prevalent theme and was associated with 25 projects. Transport and communications received the largest share among the sectors (48%).
In addition, $126 million in parallel grants, not administered by ADB, were provided from multilateral and bilateral institutions for a project in Viet Nam.
TECHNICAL ASSISTANCE
A total of 242 technical assistance (TA) projects for $243.4 million, including 197 new projects and 45 supplementary projects, were approved in 2007. This amount is 0.9% more than the 259 projects for $241.2 million approved in 2006. Of the 242 TA projects, 66 were for project preparation, 94 were advisory, and 82 were for regional assistance. Of the total amount approved, $101.3 million will be financed from the Technical Assist-ance Special Fund, $43.1 million from the Japan Special Fund, $2.0 million from the Pakistan Earthquake Fund, $7.4 million from the Regional Cooperation and Integration Fund, and the remaining $89.7 million from other multilateral and bilateral sources (Table 8).
MULTITRANCHE FINANCING FACILITIES
Seven multitranche financing facilities totaling $4.0 billion were approved in 2007, compared with eight for $3.8 billion in 2006.
RESOURCE TRANSFERS
The year showed significant improvement in disbursement, compared with the past 10 years. In discussions with borrowers, countries highlighted the need for ADB to expand support for poverty reduction programs. The Board discussed a range of new financial mechanisms and business procedure reforms under the innovation and efficiency initiative to respond to client demands.
During the year, there was a net transfer of resources of $3.2 billion from ADB to its developing member countries, compared with $2.2 billion in 2006. Of these net resource transfers, $2.4 billion went to OCR borrowers and investors in 2007, and $1.5 billion went to them in 2006. The four countries with largest net resource transfers were India, the PRC, Pakistan, and Indonesia.
Loan disbursements totaled $6.8 billion compared with $5.7 billion in 2006. Of the total, OCR disbursements were $5.2 billion or 76%, and ADF disburse-ments were $1.6 billion or 24% (Table 9).
Loan service payments totaled $3.6 billion in 2007, about the same level as that in 2006.
NONSOVEREIGN OPERATIONS
ADB approved a total of 27 financial markets and infrastructure nonsovereign projects providing $1.746 billion in assistance in 2007 (Table 11). The interventions are composed of 19 private sector loans of $760.3 million, 3 public sector loans of $105.0 million, 5 equity investments of $79.8 million, 4 credit guarantees of $376.0 million, and $425.0 million in commercial loans under ADB’s B-loan program, of which $200.0 million is for a private sector project while $225.0 million is for a public sector project.
The Board of Directors increased the ceiling for ADB’s nonsovereign operations to $5.0 billion. As of 31 December, the overall exposure of nonsovereign operations amounted to about $3.0 billion, consisting of loans of $1.5 billion, $1.1 billion in equity investments, and guarantees of $530.7 million. ADB’s non-sovereign exposure is largest in the infrastructure sector with a total of $1.4 billion, followed by exposure to the financial sector of $1.1 billion, investment funds and capital markets of $486.3 million, and exposure to other sectors at $89.8 million.
Cumulative nonsovereign operations are largest in India (18%), followed by the PRC (17%), Indonesia (11%), and Pakistan (9%). Regional projects account for roughly 11% of the total (Table 10).
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