World Bank Shares Financial Results for First Half of FY91

The World Bank announced today its preliminary financial results for the six months ended December 31, 1990, the first half of its 1991 fiscal year.

Lending

New loan commitments totaled $4.6 billion and disbursements on loans to developing countries were $5.6 billion equivalent, both about the same as in the first half of FY90. Commitments by the International Development Association (IDA), the Bank's concessional lending affiliate, totaled about $1.8 billion equivalent, compared to $1.0 billion in the first half of FY90, while IDA disbursements were $2.0 billion or 18 percent more than in the first half of FY90.

Borrowings

The World Bank's medium- and long-term borrowings amounted to $6.3 billion equivalent in the six months ended December 31, 1990. After swaps, the Bank's borrowings were in four currencies: U.S. dollars, 38 percent; Deutsche mark, 35 percent; Swiss francs, 18 percent; and Japanese yen, 9 percent. The Bank also borrowed ten currencies for use as swap vehicles –Australian dollars, Canadian dollars, Hong Kong dollars, Italian lire, Japanese yen, Netherlands quilters, New Zealand dollars, Pounds sterling, Spanish pesetas, and Swedish kroner.

Borrowings made in the first half of FY91 had an average cost, after swaps, of 8.32 percent and an average maturity of 5.9 years.

Financial Ratios

The Bank's net income, after provisioning $201 million against possible loan losses, was $797 million in the first half of FY91 compared to $556 million, after provisioning $201 million, in the first half of FY90. The increased net income was largely responsible for higher financial ratios. The return on average earning assets for the first half of FY91 was 1.40 percent and the interest coverage ratio (interest expense plus net income divided by interest expense) was 1.23 compared to 1.03 selected Balance Sheet Data

At the end of the first half of FY91, Bank’s disbursed and outstanding loans totaled $96.8 billion, compared to $85.0 billion at the end of the first half of FY90. It’s over major asset – cash and liquid investment – totaled $18.6 billion, virtually the same as a year earlier. On the liability side of its balance $94.9 billion and equity of $18.7 billion, consisting of $6.6 billion of usable paid-in capital and $12.1 billion of reserves, surplus, and accumulated net income – unallocated. The comparable figures for the first half of FY90 were $86.5 billion of outstanding borrowings and swaps and $16.2 billion of equity.

GCI Subscriptions

By the end of the first half of FY91, member countries had subscribed to about 54 percent of the General Capita1 Increase (GCI) approved in April 1988, up from about 36 percent of the available GCI shares at December 31, 1989. Twenty-seven-member countries had subscribed all of the GCI shares available to them, while nineteen others, using the alternative extended subscription method, had subscribed part of the GCI shares allocated to them. Partly as a result, the Bank had almost $54 billion of lending headroom or 36 percent of its $150.3 billion lending limit.

Attachment I

World Bank Selected Financial Information, At End of First Half of FY

(In US$ billion*)

*Figures for December 31, 1990 are preliminary