Financial Terms and Conditions of Bank Financing. Bank Access to Information Policy Designation Public

Transcription

1 Bank Directive Financial Terms and Conditions of Bank Financing Bank Access to Information Policy Designation Public Catalogue Number OPS5.09-DIR.119 Issued May 4, 2017 Effective May 4, 2017 Retired June 30, 2017 Content Elaborates on the terms and conditions of IBRD and IDA financial products. Applicable to IBRD,IDA Issuer Vice President, OPSVP Sponsor Vice President and Treasurer, TREVP

2 SECTION I PURPOSE AND APPLICATION 1. The purpose of this Directive is to elaborate on the financial terms and conditions of IBRD and IDA financial products. 2. This Directive applies to the Bank. SECTION II DEFINITIONS As used in this Directive, the capitalized terms and acronyms have the meanings set out in the Bank Policy, Financial Terms and Conditions of Bank Financing. SECTION III SCOPE The key financial terms for IBRD loans, IDA Credits, IDA Grants, IBRD and IDA guarantees and other financial products, are generally set out in the Bank Policy, Financial Terms and Conditions of Bank Financing. Additional details of these terms are set out below. 1. Eligibility for Bank Financing a. Eligibility for an IBRD loan, IBRD guarantee and other financial products is determined primarily by the member country's per capita income and creditworthiness. Exceptionally, other factors (such as size, for certain small island economies) may determine a country s eligibility for IBRD financing. Eligibility for, and the specific terms of, IDA financing are determined by the member country s GNI per capita, creditworthiness for IBRD borrowing and risk of debt distress. b. Annex 1 to this Directive lists countries ranked by GNI. Annex 2 to this Directive lists the member countries eligible for Bank financing, their per capita GNI, the type of financing for which they are eligible and the repayment terms applicable to loans to or for the benefit of each member country. 2. IBRD Loan Financial Terms a. IFL Pricing i. Variable Spread. The average funding cost element of the variable spread is recalculated by Management quarterly every January 1, April 1, July 1 and October 1, and the new rate is effective for all rate reset dates falling on or after each recalculation date as the case may be. ii. Fixed Spread. The IBRD s projected funding cost, market risk premium, and basis swap adjustment may be revised by Management from time to time. Such pricing changes are applied prospectively to new loans. Current IFL pricing can be found at Bank Directive, Financial Terms and Conditions of Bank Financing Page 1 of 23

3 iii. iv. Repayment Terms. In the event that Board approval of the loan is significantly advanced or delayed from the date expected at negotiations, the grace period provided may no longer be in accordance with these terms. In that case, the first and final principal repayment dates may be changed prior to the loan approval date to comply with these terms. Interest Rate Day-Count Convention. The day count convention follows common market practice in the currency. b. IBRD Loan Conversions; Transaction Fees i. Conversions of IBRD loans are governed by its Loan Agreement (including the applicable IBRD General Conditions) and the IBRD Guidelines for Conversion of Loan Terms, which are referenced in the Loan Agreement and the applicable IBRD General Conditions. These guidelines are available at ii. Conversions of IBRD loans and early terminations of such conversions may be subject to transaction fees, which are determined by Management from time to time. The fees for IBRD loan conversions are set forth in Annex 3 of this Directive. c. Prepayment of IBRD Loans i. The Borrower may prepay the principal amount of its loan in one or more installments, in accordance with the provisions of the Loan Agreement. In the case of IFLs and Fixed- Spread Loans (FSLs), the Borrower may specify which instalments are to be prepaid. If the Borrower does not so specify, the prepayment is applied as follows: (a) if the Loan Agreement provides for the separate amortization of disbursed amounts, the prepayment is applied in the inverse order of such disbursed amounts, with the disbursed amount that was withdrawn last being prepaid first and with the latest of such disbursed amount being prepaid first; and (b) in all other cases, the prepayment is applied in the inverse order of instalments of principal of the loan, with the latest instalment being repaid first. ii. iii. If the Borrower decides to prepay all or part of an IBRD loan, a prepayment premium, in an amount determined by Management based on the provisions in the applicable IBRD General Conditions, is charged. For IFLs, FSLs, VSLs and FSCLs, the premium is based on: (A) IBRD s redeployment cost of the prepaid loan amount and (B) the cost of unwinding any outstanding interest or currency conversions plus (C) any transaction fees applicable to amounts that were previously converted. In the case of Variable Lending Rate 1989 (VLR89) Currency Pool Loan (CPLs), Single Currency Pool (SCP) loans, Variable Lending Rate 1982 (VLR82) Currency Pool Loans, and Fixed-Rate Single Currency Pool Loans, the method for determining the prepayment premium is based on the provisions in their respective Loan Agreements. Annex 4 of this Directive sets out the manner in which the prepayment premium for prepayment of IBRD loans is calculated. If the Bank determines that an extraordinary situation has arisen under which it will be unable to provide the loan s currency for purposes of funding the loan, it may provide the Borrower with a substitute currency in accordance with the provisions of the applicable IBRD General Conditions. In such case, no prepayment premium is charged Bank Directive, Financial Terms and Conditions of Bank Financing Page 2 of 23

4 on the loan if it is prepaid while a substitute currency is outstanding unless an interest rate conversion was executed. d. Changes to Approved IBRD Repayment Terms. Under the following exceptional circumstances, Management may, upon the Borrower s request, change existing repayment terms for an IBRD loan: i. the principal amount of the loan disbursed and outstanding is less than the scheduled payment; or ii. extraordinary country, project or program circumstances have occurred. 3. IDA Financial Terms a. Acceleration of Credit Repayments to IDA. IDA has included an accelerated repayment clause in the Loan Agreements of regular and blend credits approved since This clause allows IDA to double the principal repayments of the credit (i.e. shorten the ) if the Borrower s GNI per capita exceeds a threshold and the Borrower is IBRD creditworthy. Implementation is subject to approval by IDA s Board of Directors, after considering the Borrower s economic development. The Borrower has a choice to either (a) shorten the credit's ('principal option'); (b) pay an interest rate that results in the same net present value as the principal option ('interest option'); or (c) establish a customized repayment schedule that results in the same net present value as the principal option ( customized option ). The GNI per capita threshold was originally set as exceeding the historic cut-off for 5 consecutive years (the old clause ), but in 1996 it was lowered for new credits approved to exceed the operational cut-off for 3 consecutive years (the new clause ). b. Voluntary Prepayment of IDA Credits. In December 2010, IDA s Board of Directors approved a policy framework that allows IDA to offer IDA graduates a discount to voluntarily prepay their outstanding IDA credits beyond their contractual obligations. The policy framework is available to any IDA graduate that (i) elects to voluntarily prepay all outstanding credits in full, or (ii) provides a partial prepayment applied to the latest maturities of its IDA portfolio, as determined by IDA. As an incentive to a graduate that voluntarily prepays its outstanding IDA credits beyond its contractual obligations, IDA offers a discount. The discount that IDA may offer depends on three factors: (a) an estimate of the discount rate; (b) the amount the Borrower elects to prepay; and (c) how the Borrower elects to treat the discount. The Borrower has an option to redirect the prepayment discount as a contribution to IDA. A discount is not available for prepayments of individual IDA credits specified by Borrowers. 4. IDA Annual Hard-Term Country Allocations. Annual hard-term country allocations are additional to the regular PBAs and are determined in proportion to a country s PBA. All Blend Countries, except Small Island Economies that receive financial assistance on regular IDAonly terms, are eligible for additional allocations on Hard Terms. 5. Additional fees for private sector projects involving IBRD loans, IDA Credits, IDA Grants, and IBRD and IDA guarantees: To cover the additional cost of preparing IBRD and IDA support for private sector projects, the Bank charges additional up-front fees, consisting of Bank Directive, Financial Terms and Conditions of Bank Financing Page 3 of 23

5 initiation fees and processing fees usually payable by the private sector implementing entity, project sponsors or developers, or other relevant private sector participants. Initiation and processing fees are not usually payable by the Borrower or Government. The currently applicable up-front fee levels are determined by Management and are available at The initiation and processing fees are non-refundable. a. The initiation fee is charged to offset the Bank s internal preparation and development costs for private sector projects. b. The processing fee is charged to reimburse the Bank for direct or indirect costs of external support (including external advisors) and other out-of-pocket expenses incurred by the Bank Management determines appropriate timing of the invoicing of up-front fees, and Management may, taking into account the project circumstances and development and preparation costs, reduce, increase, adjust the timing of, or decide not to charge, upfront fees. 7. SBL Surcharge. The SBL Surcharge is computed based on the aggregate of exposures arising from loans, guarantees, other relevant IBRD financial products, and exposures supported by any exposure management arrangements such as exposure exchange agreements and private placement bonds. The modality by which the SBL Surcharge is levied is jointly agreed by IBRD and the member country. 8. IBRD Hedging Products. Detailed information on the use of hedging products is set out in the IBRD Guidelines for Using Hedging Products, which are available at 9. Transaction fees for IBRD Conversions and Hedging Products are determined by Management from time to time, to cover the Bank s incremental operational costs, and, where applicable, incremental risks. The transaction fees for conversions and hedging products are set forth in Annex 3 of this Directive. 10. Bank and Borrower Responsibilities. As described in the Bank Policy, Financial Terms and Conditions of Bank Financing, the Borrower of an IBRD loan has a number of choices of financial terms for the loan. The Borrower of an IDA financing may in some cases also have a choice from among different financial terms. The Bank is responsible for ensuring that the Borrower is aware of available financing options at the appropriate time. The Bank provides information but does not recommend specific loan terms or advise the Borrower in the selection. The Borrower is solely responsible for choosing the financial terms of the loan. 1 Costs and expenses may also be recovered through the processing fee for other forms of support from IBRD and IDA that are explicitly designed to facilitate the private sector project. Bank Directive, Financial Terms and Conditions of Bank Financing Page 4 of 23

6 SECTION IV WAIVER A Waiver of any provision of this Directive may be granted only in accordance with the provisions of Bank Policy Operational Policy Waivers and the Bank Procedure Operational Policy Waivers and Waivers of Operational Requirements. SECTION V EFFECTIVE DATE This Directive is effective as of the date on its cover. SECTION VI ISSUER The Issuer of this Directive is the Vice President - Operational Policy and Country Services. SECTION VII SPONSOR The Sponsor of this Directive is the Vice President - Treasurer. SECTION VIII RELATED DOCUMENTS 1. Bank Policy, Financial Terms and Conditions of Bank Financing 2. Guidelines for Conversion of Loan Terms 3. Guidelines for Using Hedging Products Questions regarding this Directive should be addressed to the Sponsor. Bank Directive, Financial Terms and Conditions of Bank Financing Page 5 of 23

7 ANNEX 1 Countries Ranked by Per Capita Income The financing terms below are effective for all loans that are approved by the Executive Directors on or after July 1, 2016 (Updated December 2016) A. IBRD Only 1 Category iv (over $7,025) Trinidad and Tobago 18,600 Mexico 9,710 Uruguay 15,720 Mauritius 9,610 St. Kitts and Nevis 15,550 Romania 9,500 Seychelles 14,760 Suriname 9,300 Chile 14,060 Gabon 9,210 Antigua and Barbuda 13,390 Lebanon 8 7,930 Poland 13,370 China 7,820 Croatia 12,690 Equatorial Guinea 7,790 Palau 12,180 Turkmenistan 7,510 Panama 12,050 Montenegro 7,240 Kazakhstan 11,580 Bulgaria 7,220 Russian Federation 7 11,400 Colombia 7,130 Malaysia 10,570 Argentina 6 NA Costa Rica 10,210 Venezuela, RB de NA Turkey 9,950 Nauru NA Brazil 9,850 Category iii ($1,185 - $7,025) Azerbaijan 6,560 Belize 4,420 Botswana 6,510 Albania 4,290 Belarus 6,460 Paraguay 4,220 Bank Directive, Financial Terms and Conditions of Bank Financing Page 6 of 23

8 Peru 6,200 Angola 4,180 Dominican Republic 6,130 Georgia 4,160 South Africa 6,050 Tunisia 3,970 Libya 6,030 El Salvador 3,940 Ecuador 6,010 Armenia 3,880 Thailand 5,620 Guatemala 3,590 Iraq 8 5,550 Philippines 3,540 Serbia 5,500 Indonesia 3,440 Namibia 5,210 Egypt, Arab Republic of 3,340 Macedonia, FYR of 5,140 Swaziland 3,230 Jamaica 5,010 Morocco 3,030 Algeria 4,870 Ukraine 7 2,620 Fiji 4,800 India 5 1,590 Bosnia and Herzegovina 4,680 Iran, Islamic Republic of NA Jordan 8 4,680 B. Blend 2 Category iv (over $7,025) Grenada 4 8,430 St. Lucia 4 7,390 Category iii ($1,185 - $7,025) Dominica 4 6,760 Moldova 2,220 St. Vincent and the Grenadines 4 6,660 Uzbekistan 2,150 Mongolia 3,830 Vietnam 1,980 Sri Lanka 3,800 Timor-Leste 1,920 Bank Directive, Financial Terms and Conditions of Bank Financing Page 7 of 23

9 Cabo Verde 4 3,290 Pakistan 1,440 Bolivia 3,080 Cameroon 1,330 Nigeria 2,820 Papua New Guinea NA Congo, Republic of 2,540 Category i ($1,025 or less) Zimbabwe C. IDA 2 Category iii ($1,185 - $7,025) Maldives 4 6,670 Tajikistan 1,240 Guyana 4,090 Bangladesh 1,190 Kosovo, Republic of 3,950 Djibouti NA Samoa 4 3,930 Lesotho NA Kiribati 4 3,230 Marshall Islands 4 NA Bhutan 2,370 Mauritania NA Honduras 2,270 Micronesia, Fed. Sts. Of 4 NA Nicaragua 1,940 Myanmar NA Solomon Islands 4 1,940 Sao Tome and Principe 4 NA Sudan 3 1,840 Syrian Arab Republic 3, 8 NA Lao PDR 1,730 Tonga 4 NA Zambia 1,490 Tuvalu 4 NA Ghana 1,480 Vanuatu 4 NA Cote d'ivoire 1,410 Yemen, Republic of NA Kenya 1,340 Bank Directive, Financial Terms and Conditions of Bank Financing Page 8 of 23

10 Category ii ($1,185 or less) Kyrgyz Republic 1,170 Cambodia 1,070 Category i ($1,025 or less) Senegal 1,000 Mozambique 580 Tanzania 910 Togo 540 Chad 880 Guinea 470 Benin 860 Madagascar 420 Haiti 820 Congo, Democratic Republic 410 Mali 790 Niger 390 South Sudan 790 Liberia 380 Nepal 730 Malawi 350 Rwanda 700 Central African Republic 320 Uganda 670 Burundi 260 Burkina Faso 660 Comoros NA Afghanistan 630 Eritrea 3 NA Sierra Leone 630 Gambia, The NA Ethiopia 590 Somalia 3 NA Guinea-Bissau 590 Key NA = Estimates are available in ranges only Changes during current fiscal year 1. Solomon Islands has been granted the small island exception, effective in FY17, as it meets the criteria established by the 1985 decision for granting exceptions to small island countries, which is discussed in Board document IDA/R85-134, Terms of Lending to Small Island Economies Graduating from IDA. 2. Syrian Arab Republic was reclassified from IBRD to IDA-only, effective September 29, 2016 Bank Directive, Financial Terms and Conditions of Bank Financing Page 9 of 23

11 1. World Bank Atlas methodology; 2015 per capita GNI (Gross National Income, formerly GNP) figures are in U.S. dollars. 2. Countries are eligible for IDA on the basis of (a) relative poverty and (b) lack of creditworthiness. The operational cutoff for IDA eligibility for FY17 is a 2015 GNI per capita of US$1,185, using Atlas methodology. To receive IDA resources, countries must also meet tests of performance. An exception has been made for small island economies. In exceptional circumstances, IDA extends eligibility temporarily to countries that are above the operational cutoff and are undertaking major adjustment efforts but are not creditworthy for IBRD lending. 3. Loans/credits in nonaccrual status as of July 1, General information on countries with loan/credits in nonaccrual status is available from the Credit Risk Department in Finance Partners. 4. The country represents a small island economy exception and receives financing on IDA terms. 5. During IDA17 India will receive exceptional transitional support from IDA. 6. Data will be calculated once ongoing revisions to official statistics reported by the National Statistics and Censuses Institute of Argentina have been finalized. 7. These calculations are based on numbers and data from official statistics of Ukraine and the Russian Federation; by relying on those numbers and data, the Bank does not intend to make any judgment on the legal or other status of the territories concerned or to prejudice the final determination of the parties' claims. 8. From FY17, refugees are included in the population estimates of host country. Bank Directive, Financial Terms and Conditions of Bank Financing Page 10 of 23

12 ANNEX 2 IBRD/IDA and Blend Countries: Per Capita Incomes, Lending Eligibility, and Repayment Terms The financing terms below are effective for all loans that are approved by the Executive Directors on or after July 1, 2016 (Updated December 2016) For questions on per capita income estimates, please contact the Director, DECDG For questions on IDA eligibility and IDA terms, the Director, DFICF For questions on creditworthiness and IBRD terms, the Director, CROCR For questions on customized IBRD repayment terms, the Director, FABDR The following 2015 per capita income guidelines apply for operational purposes: i. US$1,025 or less for granting civil works preference to eligible domestic contractors in evaluating civil works bids procured under international competitive bidding (see World Bank Procurement Regulations for IPF Borrowers ); ii. US$1,185 or less as the operational cutoff for IDA eligibility; [US$1,945 as the historical ceiling for IDA eligibility;] iii. Over US$1,185 for IBRD terms; iv. US$7,025 or more for initiating the IBRD graduation process. IBRD Repayment IDA Repayment Terms 19 GNI per Average repayment Years to Grace Years Country Capita 1 (US$) Income Categories Lending Eligibility LDC 4 (years) (years) Period (years) 5 to Grant (%) 12 6 Afghanistan 630 i IDA 2,3 LDC % Albania 4,290 iii IBRD Algeria 4,870 iii IBRD Angola 4,180 iii IBRD LDC Antigua and Barbuda 13,390 iv IBRD Argentina 16 NA iv IBRD Armenia 3,880 iii IBRD Azerbaijan 6,560 iii IBRD Bangladesh 10 1,190 iii IDA 2,3 LDC % Belarus 6,460 iii IBRD Belize 4,420 iii IBRD Benin 860 i IDA 2,3 LDC % Bhutan 9 2,370 iii IDA 2,3 LDC % Bolivia 11 3,080 iii Blend % Bosnia and Herzegovina 4,680 iii IBRD Bank Directive, Financial Terms and Conditions of Bank Financing Page 11 of 23

13 IBRD Repayment Terms 13 IDA Repayment Terms 19 Country GNI per Capita 1 (US$) Income Categories Lending Eligibility LDC 4 Average repayment (years) Years to (years) Grace Period (years) 5 Years to 6 Grant (%) 12 Botswana 6,510 iii IBRD Brazil 9,850 iv IBRD Bulgaria 7,220 iv IBRD Burkina Faso 660 i IDA 2,3 LDC % Burundi 260 i IDA 2,3 LDC % Cabo Verde 8 3,290 iii Blend % Cambodia 1,070 ii IDA 2,3 LDC % Cameroon 11 1,330 iii Blend % Central African Republic 320 i IDA 2,3 LDC % Chad 880 i IDA 2,3 LDC % Chile 14,060 iv IBRD China 7,820 iv IBRD Colombia 7,130 iv IBRD Comoros NA i IDA 2,3 LDC % Congo, 410 i Democratic IDA 2,3 LDC % Republic Congo, 2,540 iii Blend Republic % 11 Costa Rica 10,210 iv IBRD Cote d'ivoire 9 1,410 iii IDA 2, % Croatia 12,690 iv IBRD Djibouti 9 NA iii IDA 2,3 LDC % Dominica 8 6,760 iii Blend % Dominican Republic 6,130 iii IBRD Ecuador 6,010 iii IBRD Egypt, Arab Republic of 3,340 iii IBRD El Salvador 3,940 iii IBRD Equatorial Guinea 7,790 iv IBRD LDC Eritrea 7 NA i IDA 2,3 LDC Ethiopia i IDA 2,3 LDC % Fiji 4,800 iii IBRD Gabon 9,210 iv IBRD Bank Directive, Financial Terms and Conditions of Bank Financing Page 12 of 23

14 IBRD Repayment Terms 13 IDA Repayment Terms 19 GNI per Capita 1 Income Lending Average repayment Years to (years) Grace Period (years) 5 Years to 6 Grant (%) 12 Country (US$) Categories Eligibility LDC 4 (years) Gambia, The NA i IDA 2,3 LDC % Georgia 4,160 iii IBRD Ghana 9 1,480 iii IDA 2, % Grenada 8 8,430 iv Blend % Guatemala 3,590 iii IBRD Guinea 470 i IDA 2,3 LDC % Guinea-Bissau 590 i IDA 2,3 LDC % Guyana 9 4,090 iii IDA 2, % Haiti 820 i IDA 2,3 LDC % Honduras 9 2,270 iii IDA 2, % India 15 1,590 iii IBRD % Indonesia 3,440 iii IBRD Iran, Islamic Republic of NA iii IBRD Iraq 18 5,550 iii IBRD Jamaica 5,010 iii IBRD Jordan 18 4,680 iii IBRD Kazakhstan 11,580 iv IBRD Kenya 10 1,340 iii IDA 2, % Kiribati 8 3,230 iii IDA 2,3 LDC % Kosovo, Republic of 9 3,950 iii IDA 2, % Kyrgyz Republic 1,170 ii IDA 2, % Lao PDR 9 1,730 iii IDA 2,3 LDC % Lebanon 18 7,930 iv IBRD Lesotho 9 NA iii IDA 2,3 LDC % Liberia 380 i IDA 2,3 LDC % Libya 6,030 iii IBRD Macedonia, FYR of 5,140 iii IBRD Madagascar 420 i IDA 2,3 LDC % Malawi 350 i IDA 2,3 LDC % Malaysia 10,570 iv IBRD Maldives 8 6,670 iii IDA 2, % Bank Directive, Financial Terms and Conditions of Bank Financing Page 13 of 23

15 Country GNI per Capita 1 (US$) Income Categories Lending Eligibility LDC 4 IBRD Repayment IDA Repayment Terms 19 Average repayment (years) Years to Grace Period (years) 5 Years to 6 Grant (%) 12 Mali 790 i IDA 2,3 LDC % Marshall Islands 8 NA iii IDA 2, % Mauritania 10 NA iii IDA 2,3 LDC % Mauritius 9,610 iv IBRD Mexico 9,710 iv IBRD Micronesia, Fed. Sts. Of 8 NA iii IDA 2, % Moldova 11 2,220 iii Blend % Mongolia 11 3,830 iii Blend % Montenegro 7,240 iv IBRD Morocco 3,030 iii IBRD Mozambique i IDA 2,3 LDC % Myanmar 10 NA iii IDA 2,3 LDC % Namibia 5,210 iii IBRD Nauru 20 NA iv IBRD Nepal 730 i IDA 2,3 LDC % Nicaragua 9 1,940 iii IDA 2, % Niger 390 i IDA 2,3 LDC % Nigeria 11 2,820 iii Blend % Pakistan 11 1,440 iii Blend % Palau 20 12,180 iv IBRD Panama 12,050 iv IBRD Papua New Guinea 11 NA iii Blend % Paraguay 4,220 iii IBRD Peru 6,200 iii IBRD Philippines 3,540 iii IBRD Poland 13,370 iv IBRD Romania 9,500 iv IBRD Russian Federation 17 11,400 iv IBRD Rwanda 700 i IDA 2,3 LDC % Samoa 8 3,930 iii IDA 2, % Sao Tome and Principe 8 NA iii IDA 2,3 LDC % Senegal 1,000 i IDA 2,3 LDC % Serbia 5,500 iii IBRD Bank Directive, Financial Terms and Conditions of Bank Financing Page 14 of 23

16 IBRD Repayment Terms 13 IDA Repayment Terms 19 Country GNI per Capita 1 (US$) Income Categories Lending Eligibility LDC 4 Average repayment (years) Years to (years) Grace Period (years) 5 Years to 6 Grant (%) 12 Seychelles 14,760 iv IBRD Sierra Leone 630 i IDA 2,3 LDC % Solomon Islands 1,940 iii IDA 2,3 LDC % 8 Somalia 7 NA i IDA 2,3 LDC South Africa 6,050 iii IBRD South Sudan 790 i IDA 2,3 LDC % Sri Lanka 11 3,800 iii Blend % St. Kitts and Nevis 15,550 iv IBRD St. Lucia 8 7,390 iv Blend % St. Vincent and the Grenadines 6,660 iii Blend % Sudan 7 1,840 iii IDA 2,3 LDC Suriname 9,300 iv IBRD Swaziland 3,230 iii IBRD Syrian Arab Republic 7, 18 NA iii IDA 2, Tajikistan 10 1,240 iii IDA 2, % Tanzania 910 i IDA 2,3 LDC % Thailand 5,620 iii IBRD Timor-Leste 11 1,920 iii Blend 2 LDC % Togo 540 i IDA 2,3 LDC % Tonga 8 NA iii IDA 2, % Trinidad and Tobago 18,600 iv IBRD Tunisia 3,970 iii IBRD Turkey 9,950 iv IBRD Turkmenistan 7,510 iv IBRD Tuvalu 8 NA iii IDA 2,3 LDC % Uganda 670 i IDA 2,3 LDC % Ukraine 17 2,620 iii IBRD Uruguay 15,720 iv IBRD Uzbekistan 11 2,150 iii Blend % Vanuatu 8 NA iii IDA 2,3 LDC % Venezuela, RB de NA iv IBRD Bank Directive, Financial Terms and Conditions of Bank Financing Page 15 of 23

17 IBRD Repayment Terms 13 IDA Repayment Terms 19 Country GNI per Capita 1 (US$) Income Categories Lending Eligibility LDC 4 Average repayment (years) Years to (years) Grace Period (years) 5 Years to 6 Grant (%) 12 Vietnam 11 1,980 iii Blend % Yemen, Republic of NA iii IDA 2,3 LDC % Zambia 9 1,490 iii IDA 2,3 LDC % Zimbabwe i Blend Key NA = Estimates are available in ranges only A = Annuity LRP = Level repayments of principal 1. World Bank Atlas methodology; 2015 per capita GNI (Gross National Income, formerly GNP) figures are in U.S. dollars. 2. Countries are eligible for IDA on the basis of (a) relative poverty and (b) lack of creditworthiness. The operational cutoff for IDA eligibility for FY17 is a 2015 GNI per capita of US$1,185, using Atlas methodology. To receive IDA resources, countries must also meet tests of performance. An exception has been made for some small island economies (see footnote 8). In exceptional circumstances, IDA also extends eligibility temporarily to countries that are above the operational cutoff and are undertaking major adjustment efforts but are not creditworthy for IBRD lending. 3. IDA-only countries except for limited IBRD lending for enclave projects. 4. Countries that are classified as least developed countries (LDCs) by the United Nations. 5. IDA regular term credits approved on or after July 1, 2016 will have a 6-year grace period. IDA blend term and hard-term credits will continue to have a 5-year grace period, and IDA regular term credits for small island economies will continue to have a 10-year grace period. 6. Effective from July 1, 2016, the for IDA regular credits is 38 years with principal repayable at percent per annum for years 7-38, with a service charge of 0.75 percent in SDR terms. The for IDA regular credits for small island economies will continue to be 40 years with principal repayable at 2 percent per annum for years and 4 percent per annum for years Effective from July 1, 2011, the formerly blend and hardened terms have been consolidated into one blend credit instrument with a of 25 years, a grace period of 5 years, a 0.75 percent service charge and 1.25 percent interest charge, both in SDR terms, and with principal repayable at 3.3 percent per annum for years 6-15 and 6.7 percent per annum for years The new blend terms apply to credits approved on or after July 1, In addition to credits in new blend terms, some countries are also eligible for hard-term IDA credits; please refer to footnote 11 for further information. IDA credits include an acceleration clause, providing for the possibility of doubling of principal payments from creditworthy borrowers where per capita income remains above eligibility thresholds. 7. Loans/credits in nonaccrual status as of July 1, Grant eligibility is determined when the country reengages with IDA/IBRD. General information on countries with loan/credits in nonaccrual status is available from the Credit Risk Department in Finance Partners. 8. IDA eligible countries under the small island economy exception. For credits approved on or after July 1, 2011, the financing terms for the small island blend countries are changed from blend credit terms to regular IDA credit terms. 9. The GNI per capita has been above the operational cutoff for IDA eligibility for more than two consecutive years, therefore the borrower will be subject to IDA lending on blend terms. 10. The country s GNI per capita has been above the IDA operational cutoff for either one or two years, and the borrower will continue to access IDA resources on regular terms. Once the GNI per capita has been above the operational cutoff for IDA eligibility for more than two consecutive years, the borrower will be subject to IDA lending on blend terms. Bank Directive, Financial Terms and Conditions of Bank Financing Page 16 of 23

18 11. Countries eligible for hard-term IDA credits as defined in IDA16, effective July 1, These are all countries eligible for IBRD/IDA blend financing, excluding small islands. These resources are additional to a country s regular performance based allocation. The access to hard-term credits is expanded in proportion to the countries performance-based allocation. The of hard-term credits is 25 years, with a 5 year grace period, and a 3.3 percent of principal repayable per annum for years 6-15 and 6.7 percent per annum for years Standard IDA service and commitment charges apply plus a fixed interest charge for the life of each credit. The fixed interest rate in SDR is set annually and applies to new credits approved in that year, then fixed for the duration of that credit. For credits approved on or after July 1, 2016 and before July 1, 2017, the interest rate is 1.13 percent in SDR terms. Starting from April 1, 2015, the hard term IDA credits are also available in USD, Euro, GBP and JPY, as well as in floating interest rate. 12. Grant eligibility varies by fiscal year and is based on the IDA grant framework in accordance with the IDA16 Agreement entitled Additions to IDA Resources: Sixteenth Replenishment IDA16: Delivering Development Results (February 15, 2011). 13. The new IBRD structure does not apply to loans that meet both the following conditions: (i) the Invitation to Negotiate is issued on or before June 30, 2014; and (ii) the Executive Directors approve the loan on or before September 30, IDA s financing terms reflect the application of NCBP remedies. 15. During IDA17 India receives exceptional transitional support from IDA. The for transitional support credits is 25 years, with a 5 year grace period and principle repayable at 5 percent per annum for years Transitional support credits are exempt from the accelerated repayment clause. 16. Data will be calculated once ongoing revisions to official statistics reported by the National Statistics and Censuses Institute of Argentina have been finalized. 17. These calculations are based on numbers and data from official statistics of Ukraine and the Russian Federation; by relying on those numbers and data, the Bank does not intend to make any judgment on the legal or other status of the territories concerned or to prejudice the final determination of the parties' claims. 18. From FY17, refugees are included in the population estimates of host country. 19. All IDA countries with low and moderate risk of debt distress are eligible to seek financing under the Scale-Up Facility (SUF). The financing terms under the SUF range from fixed rate to floating rate loans; the currencies available are SDR, USD, Euro, GBP and JPY. The detailed pricing methodology is as described in IDA Policy, Enhancing IDA s Financial Support in IDA17. Current financing terms are available on the Treasury website ( 20. IBRD Lending subject to OP7.00 paragraph 11. Changes during current fiscal year 1. Solomon Islands has been granted the small island exception, effective in FY17, as it meets the criteria established by the 1985 decision for granting exceptions to small island countries, which is discussed in Board document IDA/R85-134, Terms of Lending to Small Island Economies Graduating from IDA. 2. Syrian Arab Republic was reclassified from IBRD to IDA-only, effective September 29, Bank Directive, Financial Terms and Conditions of Bank Financing Page 17 of 23

19 ANNEX 3 Table 1: Transaction Fees on Conversions Expressed as a percentage per annum on the outstanding loan amount unless otherwise indicated Transaction Type For Fixed and Variable Spread Loans Interest Rate Conversion USD (1) EUR (1), JPY (1) Rate fixings of disbursed amounts 0.05% 0.10% Interest Rate Caps/Collars of disbursed amounts On a case-by-case basis Currency Conversion Of undisbursed loan amounts (2) 0.125% Of disbursed loan amounts Automatic currency conversion to local currency Changing from variable spread to fixed spread 0.06% 0.11% 0.03% 1 Currency of the loan prior to the Conversion. 2 Expressed as a percentage of the principal amount involved, and payable as a lump sum. Transaction Fees for Early Termination: For early termination of a Conversion (a currency, or interest rate conversion, or an interest rate cap/collar) a transaction fee of 0.02% per annum applies. Transaction fees expressed as a percentage per annum are converted to a lump sum. Table 2: Transaction Fees on Hedging Products Transaction Type Transaction Fee Hedges on Liabilities to IBRD Currency Swaps 0.02% Interest Rate Swaps 0.01% Interest Rate Caps/Collars 0.125% one time Commodity Swaps 0.375% one time Hedges on Liabilities to Others Major Currencies Local Currencies Currency Swaps 0.10% 0.02% Interest Rate Swaps 0.03% 0.01% Hedges on commodities and indices Case-by-case Case-by-case Bank Directive, Financial Terms and Conditions of Bank Financing Page 18 of 23

20 Table 3: Transaction Fees on Natural Disaster Risk Management Products Transaction Type Natural Disaster Risk Management Products Transaction Fee case-by-case Bank Directive, Financial Terms and Conditions of Bank Financing Page 19 of 23

21 ANNEX 4 IBRD Loan Prepayment Premium IBRD Flexible Loans (IFLs), Fixed Spread Loans (FSLs) and Variable Spread Loans (VSLs) 1. IBRD may charge a prepayment premium to cover the cost to IBRD of redeploying prepaid funds. The calculation of the redeployment cost for all or any portion of a loan that has not been converted is carried out in accordance with para.1 (a) below and, for all or any portion of a loan that has been converted, in accordance with para.1 (b) below. a. For prepayments of unconverted portions of a loan, loans with conversions of unwithdrawn amounts and no additional conversions, and loans with a conversion to fix the spread and no additional conversions, the prepayment premium is calculated as follows: i. The amount of the prepayment premium is based on the difference between: (i) the fixed or variable spread net of waivers 2, if any, payable, on the prepaid loan and (ii) the fixed or variable spread net of waivers 2, respectively, in effect for the relevant loan currency with an average repayment equivalent to the remaining average repayment of the prepaid cash-flows of the loan at the date of prepayment. ii. iii. The prepayment premium is equal to the present value of the pre-paid cashflows multiplied by the difference in the spread computed in sub-paragraph (i), with an assumed floor value of zero. The present value computed in (ii) is the premium the Borrower is charged by the Bank. b. Prepayment of converted portions of loans If all or any portion of a loan has been converted, the prepayment premium is calculated based on the following components: i. The prepayment premium as outlined in paragraph (a) above; ii. An "Unwinding Amount" 3 in connection with the early termination of any conversion. The "Unwinding Amount" is the cost or gain to the Bank in relation to the termination 2 The redeployment cost of unconverted portions of loans with fixed spread will account for differences in the contractual spread, projected funding cost, market risk premium, basis swap adjustment and premium, if applicable. The calculation of the redeployment premium will use the fixed spread in effect at loan prepayment based on average remaining of the prepaying loan, assuming redeployment into a loan with the same /risk characteristics as the prepaid loan at the time of prepayment. The redeployment cost of unconverted portions of loans with variable spread will account for differences in the contractual spread and premium, if applicable. 3 "Unwinding Amount" is defined in the General Conditions for Loans dated March 12, 2012, Article 91. Bank Directive, Financial Terms and Conditions of Bank Financing Page 20 of 23

22 of any swap effected for the relevant conversion 4. Any such cost results in an additional amount payable by the Borrower to the Bank, and any such gain is subtracted from the amount to be prepaid by the Borrower or is paid to the Borrower in the absence of any redeployment cost; 5, 6 iii. A transaction fee, which is applied to the amount of the principal that is being prepaid on a per annum basis, and discounted to the date of prepayment 7 (see TRE website for transaction fee information: 2. In the case of IFLs or FSLs, partial prepaid amounts are applied as directed by the Borrower. In the case of VSLs, partial prepaid amounts are applied first to the latest maturities due on the loan. Fixed Rate Single Currency Loans (FSCLs) 3. IBRD charges a prepayment premium based on the cost of redeploying the full amount of the loan to be prepaid from the date of prepayment to the original date. Under an FSCL, IBRD enters into rate-fixing swap transactions to provide the borrower with fixed rates. At the end of each disbursement period, through a rate-fixing swap transaction, IBRD fixes the rate for the amount of the loan disbursed during that period. Thus an FSCL consists of multiple tranches, each with its own fixed rate. Upon a prepayment, IBRD unwinds the rate fixing swap transaction(s) entered into in connection with the amount of the loan to be prepaid. 8 The degree of off-marketness of each such rate-fixing swap is used to determine the redeployment cost of the full amount of the loan to be prepaid. If IBRD enters into more than one rate fixing swap transaction in connection with the loan amount to be prepaid, IBRD nets out any gains and losses resulting from the unwinding of such swap transactions. The Borrower pays to IBRD the net amount, so calculated, as the prepayment premium; provided, however that if 4 The Bank may have affected the relevant conversion by entering into a hedge transaction with a market counterparty or, by applying a screen rate (in the circumstances described in the Conversion Guidelines). In both cases an Unwinding Amount may be payable either by the Bank or the borrower as the Bank would have taken a position in order to effect the conversion that would have to be reversed or undone because of a loan prepayment. 5 The Bank effects a market transaction or use a screen rate calculation on the prepayment date or shortly thereafter, and it generally takes two business days to settle a swap. 6 Unwinding Amount is calculated based on the assumption that the Bank swapped 100% of the converted portion of the prepaid loan. 7 The transaction fee is not applicable for prepayments of portions of loans whose currency was converted prior to withdrawal, provided no subsequent conversions of withdrawn amounts took place. 8 The Bank effects a market transaction or uses a screen rate calculation on the prepayment date or shortly thereafter, and it generally takes two business days to settle a swap. Bank Directive, Financial Terms and Conditions of Bank Financing Page 21 of 23

23 such netting results in a negative amount (i.e., in an amount due to the Borrower), such amount is deemed to be zero. In the case of a partial prepayment, prepaid amounts are applied in the inverse order of the disbursed amounts under the loan, with the disbursed amount, that was withdrawn last being prepaid first, and with the latest of such disbursed amount being prepaid first. Within each tranche, the amount to be prepaid is applied in inverse order of. Pre-Pool Loans, Currency Pool Loans (CPLs), and Single Currency Pool Loans (SCPs) 4. Assessment of the prepayment premium waiver on Currency Pool Loans (CPLs), Single Currency Pool Loans (SCPs), and pre-pool loans is based on the following procedure: a. The latest available carrying values and estimated values for loans in various categories, as reported annually in IBRD's audited financial statements, are the basis for assessing whether a waiver of the contractual prepayment premium can be granted. 9 b. The prepayment premium on the loan is waived in its entirety if the estimated value of all loans in a particular category is less than or equal to the carrying value. However, the premium is applied if the estimated value is greater than the carrying value with the added proviso that it is the smaller of the computed contractual premium on the loan and the premium over the carrying value as determined by the estimated value. If interest rates rise, the "off-marketness" of the lending rates are narrowed, and the contractual prepayment premium on these loans may be higher than the premium of the estimated value over the carrying value. In that case, the Borrower pays the latter as the premium, thus receiving a partial prepayment premium waiver. c. For financial intermediary loans with flexible amortization schedules, IBRD waives the premium if the financial intermediaries make the prepayments after receiving the prepayments from the sub-borrowers. 5. Prepayment premium schedules for pre-pool loans, CPLs, and SCPs are included in the Loan Agreements for those loans. Premia are calculated in accordance with these schedules as illustrated below. 9 "Carrying" value and "estimated" value are terms used in IBRD's financial statements. The "carrying" value of an IBRD loan is synonymous with the book value of the loan and is expressed in USD equivalent terms. It can be defined as the historical value of currencies in USD equivalents outstanding on the loan, plus the translation adjustment on the loan. IBRD loans do not have a secondary market. "Estimated" values of IBRD loans published in IBRD's financial statements are used as a proxy for the market-to-market value of IBRD loans. Bank Directive, Financial Terms and Conditions of Bank Financing Page 22 of 23

24 Variable-Rate CPL and Variable-Rate SCPs For a variable rate CPL or SCP, for each of the maturities being prepaid, the premium rate is calculated by multiplying the current interest rate on the loan with the appropriate factor from the "Premiums on Prepayment" schedule in the Loan Agreement. The premium rate so computed is then applied to the appropriate to arrive at the prepayment premium for that. Premia computed for all maturities being prepaid are added together to arrive at the prepayment premium for the loan. 7. As an illustration, assume a Category III country prepays any variable-rate pool loan with four remaining maturities. Each is $1 million and the total prepayment is US$4 million. Assume further that the current interest rate on the loan is 6.5 percent and the factor from the "Premiums on Prepayment" schedule in the Loan Agreement is The premium rate for the maturities being prepaid is (.065*.18), which is.0117, or 1.17 percent. Multiplying $4 million by the premium rate of 1.17 percent, produces the total premium of $46,800 for the loan. Converted Variable-Rate CPL and Variable-Rate SCPs 8. For CPLs and SCPs with an interest rate of LIBOR plus 1% or a swap rate-based fixed rate, the prepayment premium payable is an amount reasonably determined by Management to represent any cost to it of redeploying the amount to be prepaid at the London interbank offered rate for six month deposits in United States Dollars from the date of its prepayment to its date. 10 From May 2006 to June 30, 2009, the Bank offered borrowers of variable-rate CPLs and SCPs the option to convert the interest rate to either a LIBOR-based rate or a swap rate-based fixed rate. The prepayment policy for these converted loans is set forth in paragraph 8. Bank Directive, Financial Terms and Conditions of Bank Financing Page 23 of 23