The International Bank for Reconstruction and Development announced today that it has arranged to borrow the equivalent of $500,000,000 from the Fondo de Inversiones de Venezuela, an agency of the Government of Venezuela. The loan from the Fondo will bear interest at 8% payable semi-annually.
The loan is the largest ever single borrowing operation of the World Bank.
The borrowing is divided into two transactions: A loan of $400,000,000 denominated in United States dollars; and a loan denominated in bolivares amounting to Bs 430,000,000 equivalent to US$100,000,000. The loans will mature in 10 installments starting on August 15, 1979 and extending to August 15, 1988.
The World Bank will draw down the proceeds of the U.S. dollar loan in three tranches: $100 million on August 15, 1974, $150 million on October 15, 1974 and $150 million on January 6, 1975. The bolivar loan will be drawn down in six tranches: three of Bs 50 million each on August 15, September 16 and October 1, 1974; two of Bs 100 million each on October 15 and November 4, 1974, and one of Bs 80 million on November 18, 1974.
This is the World Bank's second borrowing in Venezuela. In March 1974, it sold Bs 100,000,000 of 7% Thirteen-Year Bonds to a group of Venezuelan commercial banks.
The documents covering the current loan were signed in Caracas by Robert S. McNamara, President of the World Bank, and by Carlos Guillermo Rangel, President of the Fondo de Inversiones de Venezuela.