ADB approves $50 mln additional contribution for CGIF

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ISLAMABAD, Jul 23 (APP):The Asian Development Bank (ADB) has approved a US $ 50 million additional capital contribution to support the guarantee operations of the Credit Guarantee Investment Facility (CGIF), a trust fund of ADB created to promote the development of deep and liquid local currency and regional bond markets in the ASEAN+3 region.

According to ADB statement received here, the CGIF was established in April 2010 with an initial capital of $700 million, including a $130 million capital contribution from ADB.

The ADB’s additional capital contribution will support regional cooperation within ASEAN+3 and promote financial resilience by allowing corporations and infrastructure projects to gain access to local currency and regional bond markets, the statement added.

It will encourage cross-border issuances, especially for corporations domiciled in those ASEAN countries still developing a fully functioning bond market.

Additional benefits include a broadening of issuers’ investor base by providing increased credit protection and more harmonization of standards and practices for bond issuance within ASEAN+3, paving the way for greater regional financial market integration.

ADB will continue to support CGIF as its third largest contributor (after Japan and the PRC) and as trustee.