TOKYO – The BRICS Development Bank has received the highest credit rating (AAA) possible from the Japan Credit Rating Agency (JCR).
The assessment was designed considering that the BRICS Development Bank or New Development Bank (NDR) has high quality risk management, strong support for member country operations and a solid capital base. ensuring financial soundness.
“The purpose of its establishment is to provide loans, guarantees, equity participation and technical assistance aimed to mobilize financial resources needed to fund projects for infrastructure and sustainable development in BRICS and other emerging economies,” JCR said in a statement.
The document also stated that: “It lends to both the sovereign entities and private enterprises in the five member countries. Its loan approvals increased from 7 loans totaling USD 1.5 billion in 2016 to 6 loans totaling USD 1.8 billion in 2017 and 17 loans totaling USD 4.7 billion in 2018. By sector, clean energy and transport infrastructure accounted for the largest share of 27% each, followed by irrigation, water resource management and sanitation accounting with 18% and urban development with 14%. Its balance of total accumulated approval loans stood at USD 7.8 billion and total accumulated disbursement loan stood at USD 624.6 million at the end of 2018. Since its current borrower countries are limited to BRICS, the quality of its loan assets is higher than those of the other MDBs whose borrowers include some poorest countries. The NDB estimates its loan commitments in 2019 to be about USD 7.5 billion.”
BRICS, having as its member countries Brazil, Russia, India and South Africa, created the bank in 2015 to finance infrastructure projects and sustainable development in emerging economies .
“The AAA international rating is a significant milestone for the Bank that is fully owned and led by developing countries. The AAA rating from JCR combined with the AA+ from S&P and Fitch respectively reflects the strong credit quality of the Bank. Given its international credit ratings, NDB is well positioned to raise capital at competitive rates through the bond markets and ensure competitive loan pricing to our clients,” said Mr. Leslie Maasdorp, NDB VP & CFO.
Currently, NDB projects in South Africa are related to environmental protection, renewable energy and have granted loans. In addition, the bank has AA + ratings from S&P Global Ratings and Fitch Ratings .