The Asian Development Bank (ADB) has signed an
agreement with five leading global insurers which will mobilise up to US$1
billion of cofinancing capacity to support lending to Financial Institutions
(FIs) in Asia and the Pacific.

The Master Framework Programme for Financial Institutions will allow the ADB
to increase its lending to both commercial banks and non-bank financial
institutions in the region through the use of credit insurance.

ADB has signed an initial three-year partnership with Tokio Marine Group
(Tokio Marine & Nichido Fire Insurance Co. Ltd, and Tokio Marine HCC), AXA
XL, Chubb, Liberty Specialty Markets, and Allianz Trade, said a press release
here today.

The highly rated insurers participating in the programme will cover the risk
of nonpayment on a portion of ADB’s loans to the financial institutions. This
will allow ADB to transfer credit risk from its portfolio to insurers’
balance sheets, freeing up ADB’s capital, managing its exposures and
increasing its lending capacity.

“ADB has been a pioneer among multilateral development banks in partnering
with private insurance companies to expand lending operations through the use
of credit insurance,” said Head of ADB’s Guarantees and Syndications Unit
Bart Raemaekers.

“The relationships we’ve built with insurers have allowed us to mobilize this
additional source of private capital as cofinancing to help meet our client’s
needs,” he added.

“Tokio Marine Group has always worked closely with multilateral development
institutions like ADB with whom we share common goals and values, as Tokio
Marine continues to pursue its vision To Be a Good Company,” said Tokio
Marine HCC Credit Group President Jerome Swinscoe.

“Our partnership with ADB has grown through the years. This landmark program
has come at an opportune time when we can all contribute to the economic
recovery that Asia needs. We are honored to be a part of this endeavor,” he
added.

The program streamlines the underwriting and approval process for risk
transfers and will allow ADB to more efficiently mobilize cofinancing
capacity. ADB’s loans to the financial sector have included support for
operational priorities such as micro, small, and medium-sized enterprises,
gender equality, and efforts to address climate change.