WASHINGTON (Reuters) – The World Bank, under pressure to do more to help developing countries deal with climate change, voted on Tuesday to change its internal lending guidelines to free up $30 billion in additional lending capacity over the next decade , World Bank President Ajay Banga told Reuters.
Banga said the bank’s arm, the International Bank for Reconstruction and Development (IBRD), would cut its equity-to-loan ratio by 1 percentage point to 18%, taking on slightly more risk, according to an independent report prepared for the Group of 20 (G20) major economies.
The move, combined with changes to the bank’s pricing policy, means the bank has increased its lending capacity by a total of $150 billion by adjusting its balance sheet, Banga said in an interview with Reuters NEXT Newsmaker.
The changes come at a time of mounting global challenges, such as the war in Ukraine, escalating violence in the Middle East and massive levels of public debt.
IBRD last changed its equity-to-loan ratio in 2023, lowering it to 19% from 20%.
