The International Bank for Reconstruction and Development has arranged to borrow Deutsche Mark 200 million (approximately $47.6 million) from the Deutsche Bundesbank, the Central Bank of West Germany.
Under the loan agreement, the World Bank may, from time to time, prior to January 31, 1961, draw down the principal of the loan. As evidence of its indebtedness, the World Bank will issue to the Bundesbank 4-3/4% notes due three years from the date of each draw down of principal. The proceeds of the borrowing will be fully convertible.
This is the second Deutsche Mark borrowing by the World Bank from the Bundesbank, an equal amount having been borrowed under a draw down arrangement made in 1958. The other World Bank borrowings of Deutsche Mark comprise a public issue of DM 200 million of 5% Fifteen-Year Bonds of the Bank on the German investment market in April 1959, and the private placement or DM 10 million (approximately 2.4 million) of notes with a European financial institution last October. Giving full effect to the present transaction, the aggregate of World Bank note and bond issues denominated in Deutsche Hark totals DM 610 million, equivalent to about $145 million.