The Asian Development Bank (ADB) has signed a three-billion-US-dollar sovereign exposure exchange agreement (EEA) with the World Bank to increase the ADB’s lending capacity for its developing members. ADB today said that the agreement is the ADB’s first EEA with the World Bank and its sixth EEA with other multilateral development banks since 2020, bringing the cumulative exchanged amount to 9 billion dollars.

 

 

ADB Vice-President for Finance and Risk Management Roberta Casali said, The exposure exchanges can be transformative because they will allow us to work together systemically, reduce concentration risk, and expand our reach precisely when our member countries need us the most. EEA is a risk management tool to reduce portfolio concentration risks. By lowering exposure concentration, the ADB said it reduces its capital usage, thereby increasing its lending capacity.