An international financial institution (IFI) is a

financial institution A financial institution, sometimes called a banking institution, is a business entity that provides service as an intermediary for different types of financial monetary transactions. Broadly speaking, there are three major types of financial ins ...

that has been established (or chartered) by more than one country, and hence is subject to

international law International law, also known as public international law and the law of nations, is the set of Rule of law, rules, norms, Customary law, legal customs and standards that State (polity), states and other actors feel an obligation to, and generall ...

. Its owners or shareholders are generally national governments, although other international institutions and other organizations occasionally figure as shareholders. The most prominent IFIs are creations of multiple nations, although some bilateral financial institutions (created by two countries) exist and are technically IFIs. The best known IFIs were established after World War II to assist in the reconstruction of Europe and provide mechanisms for international cooperation in managing the global financial system.

Types

Multilateral Development Banks

A Multilateral Development Bank (MDB) is a development bank, created by a group of countries, that provides

financing Funding is the act of providing resources to finance a need, program, or project. While this is usually in the form of money, it can also take the form of effort or time from an organization or company. Generally, this word is used when a firm use ...

, technical assistance and professional advice to enhance development. An MDB has many members, including developed donor countries and developing borrower countries. MDBs finance projects through long-term loans at market rates, very-long-term loans below market rates (also known as credits), and grants. Additionally, MDBs often have a geographic concentration area for their development objectives. With this geographic and thematic focus, funding for a variety of ventures – often resource-intense infrastructure projects – is provided. Since MDBs have a shareholding structure and are backed by member countries, they tend to profit from favorable

loan In finance, a loan is the tender of money by one party to another with an agreement to pay it back. The recipient, or borrower, incurs a debt and is usually required to pay interest for the use of the money. The document evidencing the deb ...

conditions compared to other banks and can therefore take more risks in their

investment Investment is traditionally defined as the "commitment of resources into something expected to gain value over time". If an investment involves money, then it can be defined as a "commitment of money to receive more money later". From a broade ...

strategy. This aids their development-driven cause. Since the 2020s, in the context of the G20, the

World Bank The World Bank is an international financial institution that provides loans and Grant (money), grants to the governments of Least developed countries, low- and Developing country, middle-income countries for the purposes of economic development ...

- IMF Annual Meetings and other International Summits, MDBs have committed to multiple shared reform objectives. This MDBs Reform process aims to integrate MDBs in terms of operational practices, objectives, financial metrics and governance structures, enabling them to work as a system in development projects, to mobilize additional capital and achieve credit rating stability. The Capital Adequacy Framework (CAF) reform has been one of the main fields of MDB reform, aiming the enhance financing capacity and harmonize financial metrics among MDBs. The following are usually classified as the main MDBs: *

European Investment Bank The European Investment Bank (EIB) is the European Union's investment bank and is owned by the 27 member states. It is the largest multilateral financial institution in the world. The EIB finances and invests both through equity and debt sol ...

(EIB) * Islamic Development Bank (IsDB) *

Asian Development Bank The Asian Development Bank (ADB) is a regional development bank to promote social and economic development in Asia. The bank is headquartered in Metro Manila, Philippines and maintains 31 field offices around the world. The bank was establishe ...

(ADB) * European Bank for Reconstruction and Development (EBRD) * CAF – Development Bank of Latin America and the Caribbean (CAF) * Inter-American Development Bank Group (IDB, IADB) * African Development Bank (AfDB) * New Development Bank (NDB) * Asian Infrastructure Investment Bank (AIIB) * Arab Petroleum Investments Corporation (APICORP) * Eastern and Southern African Trade and Development Bank (TDB) There are also several "sub-regional" multilateral development banks. Their membership typically includes only borrowing nations. The banks lend to their members, borrowing from the international capital markets. Because there is effectively shared responsibility for repayment, the banks can often borrow more cheaply than could any one member nation. These banks include: *

Caribbean Development Bank The Caribbean Development Bank (CDB) is a development bank that helps Caribbean countries finance social and economic programs in its member countries through loans, grants, and technical assistance. The CDB was established by an Agreement signed ...

(CDB) *

Central American Bank for Economic Integration The Central American Bank for Economic Integration - CABEI ( BCIE in Spanish) was founded in 1960. It is an international multilateral development financial institution. Its resources are invested in projects that foster development to reduce pov ...

(CABEI) *

Council of Europe Development Bank The Council of Europe Development Bank (CEB, ) is a multilateral development bank, granting loans to member states to help disaster victims, help with job creation, and improve social infrastructure. , its assets stood at 28 billion euros, whic ...

(CEB) *

East African Development Bank The East African Development Bank (EADB) is a regional development finance institution located in Kampala, Uganda with the objective of promoting development in the member countries of the East African Community. The current member states of th ...

(EADB) * West African Development Bank (BOAD) * Black Sea Trade and Development Bank (BSTDB) * Economic Cooperation Organization Trade and Development Bank (ETDB) * Eurasian Development Bank (EDB) * North American Development Bank (Nadbank) There are also several multilateral financial institutions (MFIs). MFIs are similar to MDBs but they are sometimes separated since they have more limited memberships and often focus on financing certain types of projects. *

European Commission The European Commission (EC) is the primary Executive (government), executive arm of the European Union (EU). It operates as a cabinet government, with a number of European Commissioner, members of the Commission (directorial system, informall ...

(EC) * International Finance Facility for Immunisation (IFFIm) * International Fund for Agricultural Development (IFAD) * Nordic Investment Bank (NIB) * OPEC Fund for International Development * Nederlandse Financieringsmaatschappij voor Ontwikkelingslanden NV (FMO) * International Bank for Economic Co-operation (IBEC) * International Investment Bank (IIB) * Arab Bank for Economic Development in Africa (BADEA)

Bretton Woods institutions

The best-known IFIs were established after

World War II World War II or the Second World War (1 September 1939 – 2 September 1945) was a World war, global conflict between two coalitions: the Allies of World War II, Allies and the Axis powers. World War II by country, Nearly all of the wo ...

to assist in the reconstruction of Europe and provide mechanisms for international cooperation in managing the

global financial system The global financial system is the worldwide framework of legal agreements, institutions, and both formal and informal agent (economics), economic action that together facilitate international flows of financial capital for purposes of investme ...

. They include the

, the IMF, and the International Finance Corporation. Today the largest IFI in the world is the European Investment Bank which lent 61 billion euros to global projects in 2011.

Regional development banks

The regional development banks consist of several regional institutions that have functions similar to the World Bank group's activities, but with particular focus on a specific region. Shareholders usually consist of the regional countries plus the major donor countries. The best-known of these regional banks cover regions that roughly correspond to

United Nations The United Nations (UN) is the Earth, global intergovernmental organization established by the signing of the Charter of the United Nations, UN Charter on 26 June 1945 with the stated purpose of maintaining international peace and internationa ...

regional groupings, including the Inter-American Development Bank, the

; the African Development Bank; the

; and the European Bank for Reconstruction and Development. The Islamic Development Bank is among the leading multilateral development banks. IsDB is the only multilateral development bank after the World Bank that is global in terms of its membership. 56 member countries of IsDB are spread over Asia, Africa, Europe and Latin America.

Bilateral development banks and agencies

A bilateral development bank is a financial institution set up by one individual country to finance development projects in a

developing country A developing country is a sovereign state with a less-developed industrial base and a lower Human Development Index (HDI) relative to developed countries. However, this definition is not universally agreed upon. There is also no clear agreeme ...

and its emerging market, hence the term bilateral, as opposed to multilateral. Examples include: * the Netherlands Development Finance Company FMO, headquarters in

The Hague The Hague ( ) is the capital city of the South Holland province of the Netherlands. With a population of over half a million, it is the third-largest city in the Netherlands. Situated on the west coast facing the North Sea, The Hague is the c ...

; one of the largest bilateral development banks worldwide. * the DEG German Investment Corporation or Deutsche Investitions- und Entwicklungsgesellschaft, headquartered in Cologne, Germany. * the French Development Agency, and Caisse des dépôts, founded 1816, both headquartered in

Paris, France Paris () is the Capital city, capital and List of communes in France with over 20,000 inhabitants, largest city of France. With an estimated population of 2,048,472 residents in January 2025 in an area of more than , Paris is the List of ci ...

. * the British International Investment, is a development finance institution owned by the UK Government headquartered in

London London is the Capital city, capital and List of urban areas in the United Kingdom, largest city of both England and the United Kingdom, with a population of in . London metropolitan area, Its wider metropolitan area is the largest in Wester ...

Other regional financial institutions

Financial institutions of neighboring countries established themselves internationally to pursue and finance activities in areas of mutual interest; most of them are

central banks A central bank, reserve bank, national bank, or monetary authority is an institution that manages the monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monet ...

, followed by development and investment banks. The table below lists some of them in chronological order of when they were founded or listed as functioning as a legal entity. Some institutions were conceived and started working informally 2 decades before their legal inception (e.g. the South East Asian Central Banks Centre)

References

External links

Dataset on all official international lending (230,000 loans, grants and guarantees) by states and multilateral institutions over the period 1790-2015.Bank Information Center

{{Authority control * Supranational banks International development Multilateral development banks