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Public Sector (Sovereign) Financing

ADB offers a range of financial products that help developing member countries (DMCs) build economic growth and social development. These tools include loans, technical assistance, and grants.

Lending Policies and Rates

Lending Policies

ADB’s lending policies

ADB uses a classification system to determine the eligibility of developing member countries (DMCs) to borrow based on two main criteria, (i) per capita income and (ii) creditworthiness. DMCs are classified into:

  • Group A (Concessional assistance-only): those in need of greatest concessionality and eligible for Asian Development Fund (ADF) grants
  • Group B  (OCR blend): those that need some concessionality, and
  • Group C (Regular OCR only): those in need of least concessionality.

DMCs within these groups are further differentiated to determine the mix of funds and lending terms they can access, based on ADB’s (i) concessional assistance policy and (ii) policy on diversified financing terms (effective 2021).

Classification of DMCs in 2020

(Download pdf)

Concessional Assistance Countries

Group A: Concessional Assistance-only OCR Blend
ADF-eligible COL-only Gapa
ADF-only (100% grant) ADF Blend (50% grant) COL-only (0% grant)
Afghanistan ƒ
Federated States of Micronesia ƒσ
Kiribati ƒσ
Marshall Islands ƒσ
Nauru ƒσ
Samoa σ
Tajikistan
Tonga σ
Tuvalu ƒσ
Kyrgyz Republic
Maldives σ
Solomon Islands ƒσ
Vanuatu σ
Cambodia
Nepal
Bhutan
Lao People’s Democratic Republic
Myanmar ƒ
Bangladesh
Mongolia
Pakistan
Palau σ
Papua New Guinea ƒσ
Timor-Leste ƒσ
Uzbekistan

Regular OCR only Countriesb

C0
SIDS below the IBRD income cutoff and new group C
C1
SIDS above the IBRD income cutoff and LMICs
C2
UMICs below the IBRD income cutoff
C3
UMICs above the IBRD income cutoff
C4
High-income Countries
Fiji σ
Sri Lanka
Viet Nam
Armeniac
Cook Islands σ
Georgiac
Indiad
Indonesia
Philippines
Azerbaijan
Thailand
Turkmenistan
Kazakhstan
Malaysia
People’s Republic of China
 

ƒ = fragile and conflict affected situation, σ = small island developing states, ADF = Asian Development Fund, COL = concessional OCR lending, IBRD = International Bank for Reconstruction and Development, Lao PDR = Lao People’s Democratic Republic, LMICs = lower middle-income countries, OCR = ordinary capital resources, SIDS = small island developing states; UMICs = upper middle-income countries.

a COL-only gap countries, as designated by the International Development Association (IDA), ineligible for ADF grants under the ADB’s concessional assistance policy.
b In 2020, regular OCR terms are the same for all. Differentiated terms will take effect beginning 2021.
c UMICs for no more than 2 consecutive years.
d Group B with no access to concessional assistance.

Developing members: Afghanistan; Armenia; Azerbaijan; Bangladesh; Bhutan; Brunei Darussalam; Cambodia; People’s Republic of China; Cook Islands; Georgia; India; Indonesia; Fiji; Hong Kong, China; Kazakhstan; Kiribati; Republic of Korea; Kyrgyz Republic; Lao People’s Democratic Republic; Malaysia; Maldives; Marshall Islands; Federated States of Micronesia; Mongolia; Myanmar; Nauru; Nepal; Niue; Pakistan; Palau; Papua New Guinea; Philippines; Samoa; Singapore; Solomon Islands; Sri Lanka; Taipei,China; Tajikistan; Thailand; Timor-Leste; Tonga; Turkmenistan; Tuvalu; Uzbekistan; Vanuatu; Viet Nam.

By making any designation of or reference to a particular territory or geographical area, or by using the term "country" in the website, ADB does not intend to make any judgment as to the legal or other status of any territory or area. Boundaries, colors, denominations or any other information shown on maps do not imply, on the part of ADB, any judgment on the legal status of any territory, or any endorsement or acceptance of such boundaries, colors, denominations, or information.

Some members enter a new phase in their relationship with ADB as defined under the Classification and Graduation Policy.

 

Terms and conditions of ADB's concessional loans

  Maturity Grace Period Interest Other Features
Group A (CA-only): Project Loans 32 yrs 8 yrs 1% during the grace period
1.5% during the amortization period
Equal amortization; No commitment fee
Group A (CA-only): Program Loans 24 yrs 8 yrs 1% during the grace period
1.5% during the amortization period
Equal amortization; No commitment fee
Group B (OCR blend) 25 yrs 5 yrs 2% interest per year Equal amortization; No commitment fee
Emergency Assistance Loans 40 yrs 10 yrs 1% interest per year Principal repayment at 2% per year for the first 10 years after the grace period and 4% per year thereafter; No commitment fee
 

ADB Loan Charges for Regular OCR LIBOR-based Loans (LBL)

Item USD
(in basis points)
JPY
(in basis points)
EUR
(in basis points)
Average Loan Maturity <=13 years > 13 years up to 16 years > 16 years up to 19 years <=13 years > 13 years up to 16 years > 16 years up to 19 years <=13 years > 13 years up to 16 years > 16 years up to 19 years
A. Interest Spread
1. Effective Contractual Spread 50 50 50 50 50 50 50 50 50
2. (Rebate) / Surcharge on Funding Cost Margin* 2 2 2 -38 -38 -38 2 2 2
3. Maturity Premium N/A 10 20 N/A 10 20 N/A 10 20
4. Net Spread Over LIBOR (1+2+3)* 50 60 70 12 22 32 52 62 72
B. Commitment Charge
(based on the undisbursed balance of the loan)
15 15 15 15 15 15 15 15 15

* Determined semi-annually. This margin is applicable to outstanding OCR LIBOR-based sovereign loans from 1 July to 31 December 2020.
Note: LBLs have a maximum average maturity limit of 19 years.

Average loan maturity is the average number of years to repay, weighted by repayment amounts. For example, a 20-year loan with 2 equal repayments in years 10 and 20 will have an average maturity of 15 years (10 x 50% + 20 x 50%).

Indicative Lending Rates for LIBOR-Based Loans

ADB provides indicative lending rates as a service to borrowers for loans under the LIBOR-based loan facility, foreign exchange rates, and cap/collar premiums for floating rate loans. The rates are as of 30 July 2020.

For inquiries, please email the  Treasury Department