Authorizations

• AIIB can provide financing on a sovereign basis, directly to AIIB member governments or to entities guaranteed by AIIB member governments
• Sovereign guarantees must cover debt service defaults caused by a government’s failure to meet a specific obligation in relation to the project being financed or by a borrower’s failure to make a payment under the loan and must be accompanied by a sovereign indemnity
• AIIB can also provide financing on a non-sovereign basis to private-sector firms or sub-sovereign entities not backed by a guarantee or counter-guarantee and indemnity provided by an AIIB member government to the bank

• AIIB can make direct equity investments in new or existing private or public sector companies, in modalities including:
• Subscriptions to ordinary shares or preference shares (or a combination of both)
• A loan convertible into equity—AIIB’s investment may not exceed 30% of the company’s ownership holdings; in exceptional circumstances, the Board may decide to approve a higher, but not controlling share
• If AIIB’s investment is in jeopardy, it may take control of the company in order to safeguard its investment

• AIIB may make an advance to finance preparatory activities for a project to be supported by sovereign-backed financing—such an advance would only be made when there is a strong probability that the financing for which it is granted will be extended
• Granting a preparation advance does not obligate AIIB to finance or otherwise support the project for which it is granted
• The maximum aggregate principal amount of all approved preparation advances for any given project may not exceed the lesser of 10% of the total estimated amount of financing for the project, USD 10 million equivalent, or exceptionally higher if approved by AIIB’s president

• AIIB has an environmental and social framework with guidelines in respect of:
• Environmental and social assessment and management
• Involuntary resettlement
• Indigenous peoples

• AIIB also has a strict risk management framework to properly assess and mitigate risk

• The bank also has policies on asset liability management, financing, and prohibited practices

• The Special Fund Window for Less Developed Members (SFW) provides interest rate buy-down for eligible sovereign-backed financing projects to make AIIB financing more affordable for its less developed Members

• The Multilateral Cooperation Center for Development Finance Special Fund was established to administer grants received by AIIB as Implementing Partner of the Finance Facility of the Multilateral Cooperation Center for Development Finance (MCDF)

• 2023: AIIB-FAO partnership to boost rural infrastructure development

• 2023: AIIB grows to 109 members globally