Support for new products will expand lending headroom by tens of billions
WASHINGTON, June 13, 2024- Canada became the latest World Bank Group shareholder on Thursday to invest in hybrid capital, a financial product with special leveraging potential that expands the Bank's lending capacity to help developing countries advance the U.N.'s Sustainable Development Goals.
Canada pledged US$200 million to hybrid capital, which when leveraged will provide up to $1.6 billion in additional lending capacity over 10 years. Canada's announcement follows a similar one in April, when a first group of 11 countries committed more than US$11 billion to hybrid capital and a new Portfolio Guarantee Platform. With Canada's contribution, this funding could generate additional lending headroom of more than US$70 billion over 10 years.
"Canada's generosity will help finance critical development priorities such as the energy transition, stronger health systems, protecting biodiversity and much more. Our members are meeting the moment with critical resources to drive impact and build a sustainable future on a livable planet," said Ajay Banga, World Bank Group President.
Canada joins Denmark, Germany, Italy, Latvia, the Netherlands, Norway, and the United Kingdom to make commitments to purchase hybrid capital, while Belgium, France, Japan, and the United States have pledged to the Portfolio Guarantee Platform.
