Multilateral banks could lend up to $480 billion more before rating downgrades, Fitch says 

GLOBAL-DEVELOPMENT/BANKS (GRAPHIC, PIX):Multilateral banks could lend up to $480 billion more before rating downgrades, Fitch says 

Reuters
Published10 Oct 2024, 03:23 AM IST
Multilateral banks could lend up to $480 billion more before rating downgrades, Fitch says 
Multilateral banks could lend up to $480 billion more before rating downgrades, Fitch says 

Oct 9 (Reuters) - A dozen of the largest multilateral development banks could collectively lend a further half-trillion dollars before facing rating downgrades, Fitch said in a Wednesday report, following a review of its criteria for rating supranational institutions.

The multilateral lenders in Fitch's report "could collectively lend nearly an additional $480 billion" before a cash shortage would lead to downgrades, all else being equal, the rating agency said. MDBs are international banks chartered by multiple countries to develop economies in lower- and middle-income countries.

Still, Fitch said it sees the multilaterals continuing to operate well within the thresholds of their ratings, meaning Fitch does not expect them to fully use the lending headroom.

According to Fitch, the International Bank for Reconstruction and Development, the World Bank Group's lending arm, could lend a further $117 billion, or 47% of its current banking exposure, with nearly $100 billion and $90 billion extra available for the Asian Development Bank and European Investment Bank respectively.

The report says both the Asian Infrastructure Investment Bank and the New Development Bank could more than double their current banking exposure without flashing red in their cash position. The overall figure would increase the 12 lenders' banking exposure by 37%, Fitch said.

"MDBs are reviewing their capital adequacy frameworks in response to demands from their shareholders that they increase their development impact," the report said. "Fitch expects MDBs will respond with some adjustment to capital management while maintaining capital ratios consistent with their high ratings."

This year, leaders of 10 MDBs committed to take action in five critical areas, including additional lending headroom totaling $300 billion to $400 billion over the next decade.

(Reporting by Rodrigo Campos in New York; Editing by Rod Nickel)

Catch all the Business News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

MoreLess
First Published:10 Oct 2024, 03:23 AM IST
Business NewsNewsMultilateral banks could lend up to $480 billion more before rating downgrades, Fitch says 

Get Instant Loan up to ₹10 Lakh!

  • Employment Type

    Most Active Stocks

    Tata Steel share price

    150.90
    03:56 PM | 7 NOV 2024
    -2.7 (-1.76%)

    Bharat Electronics share price

    300.20
    03:58 PM | 7 NOV 2024
    -1.65 (-0.55%)

    Bank Of Baroda share price

    262.90
    03:29 PM | 7 NOV 2024
    0.3 (0.11%)

    Indian Oil Corporation share price

    144.20
    03:59 PM | 7 NOV 2024
    -0.45 (-0.31%)
    More Active Stocks

    Market Snapshot

    • Top Gainers
    • Top Losers
    • 52 Week High

    Apollo Hospitals Enterprise share price

    7,424.60
    03:40 PM | 7 NOV 2024
    454.75 (6.52%)

    Welspun Corp share price

    798.00
    03:29 PM | 7 NOV 2024
    24.55 (3.17%)

    City Union Bank share price

    181.50
    03:29 PM | 7 NOV 2024
    2 (1.11%)

    Federal Bank share price

    206.00
    03:57 PM | 7 NOV 2024
    1.2 (0.59%)
    More from 52 Week High

    Hindalco Industries share price

    648.35
    03:51 PM | 7 NOV 2024
    -59.9 (-8.46%)

    Trent share price

    6,498.45
    03:59 PM | 7 NOV 2024
    -454.6 (-6.54%)

    Glenmark Pharmaceuticals share price

    1,658.00
    03:29 PM | 7 NOV 2024
    -110.95 (-6.27%)

    Blue Star share price

    1,776.95
    03:56 PM | 7 NOV 2024
    -101.8 (-5.42%)
    More from Top Losers

    Swan Energy share price

    535.60
    03:29 PM | 7 NOV 2024
    39.05 (7.86%)

    KEC International share price

    1,050.30
    03:40 PM | 7 NOV 2024
    74.8 (7.67%)

    Apollo Hospitals Enterprise share price

    7,424.60
    03:40 PM | 7 NOV 2024
    454.75 (6.52%)

    FSN E-Commerce Ventures share price

    192.90
    03:29 PM | 7 NOV 2024
    11.45 (6.31%)
    More from Top Gainers

    Recommended For You

      More Recommendations

      Gold Prices

      • 24K
      • 22K
      Bangalore
      78,575.00-1,790.00
      Chennai
      78,581.00-1,790.00
      Delhi
      78,733.00-1,790.00
      Kolkata
      78,585.00-1,790.00

      Fuel Price

      • Petrol
      • Diesel
      Bangalore
      102.92/L0.00
      Chennai
      100.80/L0.00
      Kolkata
      104.95/L0.00
      New Delhi
      94.77/L0.00

      Popular in News

        HomeMarketsPremiumInstant LoanMint Shorts