Asian Development Bank

Fighting poverty in Asia and the

Motto
Pacific
Formation 19 December 1966
Type Multilateral Development Bank
Legal status Treaty
Purpose Social and economic development
Mandaluyong, Metro Manila,
Headquarters
Philippines
Region
Asia-Pacific
served
Membership 67 countries
President Takehiko Nakao
Main organ Board of Governors[1]
Staff 2997 employees[2]
Website http://www.adb.org

The Asian Development Bank (ADB) is a regional development bank established on 19

December 1966 which is headquartered in Ortigas Center located in Mandaluyong, Metro
Manila, Philippines, and maintains 31 field offices around the world, to promote social and
economic development in Asia. The bank admits the members of the United Nations Economic
and Social Commission for Asia and the Pacific (UNESCAP, formerly the Economic
Commission for Asia and the Far East or ECAFE) and non-regional developed countries.

From 31 members at its establishment, ADB now has 67 members, of which 48 are from within
Asia and the Pacific and 19 outside. The ADB was modeled closely on the World Bank, and has
a similar weighted voting system where votes are distributed in proportion with members' capital
subscriptions. ADB releases an annual report that summarizes its operations, budget and other
materials for review by the public.

At the end of 2014, Japan holds the largest proportion of shares at 15.7%. The United States
holds 15.6%, China holds 6.5%, India holds 6.4%, and Australia holds 5.8%.

Organization
The highest policy-making body of the bank is the Board of Governors, composed of one
representative from each member state. The Board of Governors, in turn, elect among themselves
the twelve members of the Board of Directors and their deputy. Eight of the twelve members
come from regional (Asia-Pacific) members while the others come from non-regional members.

The Board of Governors also elect the bank's president, who is the chairperson of the Board of
Directors and manages ADB. The president has a term of office lasting five years, and may be
reelected. Traditionally, and because Japan is one of the largest shareholders of the bank, the
president has always been Japanese.

The most recent president was Takehiko Nakao, who succeeded Haruhiko Kuroda in 2013

The headquarters of the bank is at 6 ADB Avenue, Mandaluyong, Metro Manila, Philippines,and
it has 25 field offices in Asia and the Pacific and representative offices in Washington, Frankfurt,
Tokyo and Sydney. The bank employs about 3,000 people, representing 60 of its 67 members.

Objectives and activities

Aim

The ADB defines itself as a social development organization that is dedicated to reducing
poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable
growth, and regional integration. This is carried out through investments – in the form of loans,
grants and information sharing – in infrastructure, health care services, financial and public
administration systems, helping nations prepare for the impact of climate change or better
manage their natural resources, as well as other areas.

Focus areas

Eighty percent of ADB’s lending is concentrated public sector lending in five operational areas.

 Education - Most developing countries in Asia and the Pacific have earned high marks
for a dramatic rise in primary education enrollment rates in the last three decades, but
daunting challenges remain, threatening economic and social growth.
 Environment, Climate Change, and Disaster Risk Management - Environmental
sustainability is a prerequisite for economic growth and poverty reduction in Asia and the
Pacific.
 Finance Sector Development - The financial system is the lifeline of a country’s
economy. It creates prosperity that can be shared throughout society and benefit the
poorest and most vulnerable people. Financial sector and capital market development,
including microfinance, small and medium-sized enterprises, and regulatory reforms, is
vital to decreasing poverty in Asia and the Pacific.
 Infrastructure, including transport] and communications, energy, water supply and
sanitation, and urban development.
 Regional Cooperation and Integration - Regional cooperation and integration (RCI) was
introduced by President Kuroda when he joined the ADB in 2004. It was seen as a long-
 standing priority of the Japanese government as a process by which national economies
become more regionally connected. It plays a critical role in accelerating economic
growth, reducing poverty and economic disparity, raising productivity and employment,
and strengthening institutions.
 Private Sector Lending - This priority was introduced into the ADB's activities at the
insistence of the Reagan Administration. However, that effort was never a true priority
until the administration of President Tadeo Chino who in turn brought in a seasoned
American banker - Robert Bestani. From then on, the Private Sector Operations
Department (PSOD) grew at a very rapid pace, growing from the smallest financing unit
of the ADB to the largest in terms of financing volume. As noted earlier, this culminated
in the Long Term Strategic Framework (LTSF) which was adopted by the Board in
March 2008.

Lending
The ADB offers "hard" loans on commercial terms primarily to middle income countries in Asia
and "soft" loans with lower interest rates to poorer countries in the region. Based on a new
policy, both types of loans will be sourced starting January 2017 from the bank’s ordinary capital
resources (OCR), which functions as its general operational fund.

In 2014, ADB lent $11.2 billion to its member governments – known as "sovereign" lending –
and invested another $1.7 billion in private enterprises, as part of its "nonsovereign" operations.
ADB’s operations in 2014, including grants and other assistance, totaled $22.93 billion.

ADB obtains its funding by issuing bonds on the world's capital markets. It also relies on the
contributions of member countries, retained earnings from lending operations, and the repayment
of loans.[30]

Private sector investments

ADB provides direct financial assistance, in the form of debt, equity and mezzanine finance to
private sector companies, for projects that have clear social benefits beyond the financial rate of
return. ADB’s participation is usually limited but it leverages a large amount of funds from
commercial sources to finance these projects by holding no more than 25% of any given
transaction.

Cofinancing
ADB partners with other development organizations on some projects to increase the amount of
funding available. In 2014, $9.2 billion—or nearly half—of ADB’s $22.9 billion in operations
were financed by other organizations. According to Jason Rush, Principal Communication
Specialist, the Bank communicates with many other multilateral organizations.
Funds and resources
More than 50 financing partnership facilities, trust funds, and other funds – totalling several
billion each year – are administered by ADB and put toward projects that promote social and
economic development in Asia and the Pacific.

Access to information
ADB has an information disclosure policy that presumes all information that is produced by the
institution should be disclosed to the public unless there is a specific reason to keep it
confidential. The police calls for accountability and transparency in operations and the timely
response to requests for information and documents. ADB does not disclose information that
jeopardizes personal privacy, safety and security, certain financial and commercial information,
as well as other exceptions

Members

ADB has 67 shareholding members including 48 from the Asia and Pacific region. View a
complete list of our members.

Board of Governors

ADB's highest policy-making body is the Board of Governors, which comprises one
representative from each member nation – 48 from the Asia-Pacific and 19 from outside the
region The Agreement Establishing the Asian Development Bank, known as the ADB Charter,
vests all the powers of the institution in the Board of Governors, which in turn delegates some of
these powers to the Board of Directors. The Board of Governors meets formally once a year
during ADB's Annual Meeting.

Board of Directors

The Governors elect 12 members to form the Board of Directors, which performs its duties full
time at the ADB headquarters. The Directors supervise ADB's financial statements, approve its
administrative budget, and review and approve all policy documents and all loan, equity, and
technical assistance operations

Members of the ADB Board of Directors supervise the institution’s financial statements, approve
its administrative budget, and decide on all policy documents as well as loan, grant and equity
investments made by ADB.
Policies and Strategies
Strategy 2020
ADB’s long-term strategic framework promotes three complementary agendas on inclusive
economic growth, environmentally sustainable growth, and regional integration.

 Strategy 2020: The Long-Term Strategic Framework of the Asian Development Bank
2008-2020
 Strategy 2020 midterm review
 Corporate results framework
 Key accomplishments under Strategy 2020

Core Operational Areas

80% of ADB lending is in five core operational areas, identified as comparative strengths of
ADB.

 Infrastructure
o Water Operational Plan 2011-2020
o Energy Policy
o Sustainable Transport Initiative Operational Plan
o Urban Operational Plan 2012–2020
o Toward E-Development in Asia and the Pacific: A Strategic Approach for
Information and Communication Technology
 Education by 2020: A Sector Operations Plan
 Environment
o Environment Operational Directions 2013–2020
o Addressing Climate Change in Asia and the Pacific: Priorities for Action
o Operational Plan for Integrated Disaster Risk Management 2014-2020
 Regional Cooperation and Integration Strategy
 Financial Sector Operational Plan

Other Operational Areas

 Operational Plan for Health, 2015–2020
 Operational Plan for Sustainable Food Security in Asia and the Pacific
 Private Sector Development: A Revised Strategic Framework
 Revised Capacity Development Action Plan
 Gender Equality and Women's Empowerment Operational Plan, 2013-2020
 Knowledge Management Directions and Action Plan (2013-2015)
 Cooperation Arrangements for Development Partnerships
Regional/Country Partnership Strategies
The regional cooperation strategy outlines how an ADB-defined region or subregion can work
together to foster economic growth and cooperation.

 Regional Cooperation Strategy and Programs

The country partnership strategy is ADB's primary platform for designing operations to deliver
development results at the country level.

 Country Partnership Strategies

 Country Partnership Strategy Updates
 Country Operations Business Plans

Transparency and Accountability

 Public Communications Policy 2011
 Accountability Mechanism Policy 2012
 Cooperation between Asian Development Bank and Nongovernment Organizations
 Anticorruption Policy: Harmonized Definitions of Corrupt and Fraudulent Practices
 Anticorruption Policy: Proposed Clarifications and Related Changes to Consulting and
Procurement Guidelines
 Safeguard Policy Statement
 Evaluation Policy

Operations Manual
The operations manual of ADB collects operational policies known as "Bank policies." The
manual also includes operational procedures that spell out procedural requirements and guidance
on the implementation of policies.