AIIB Current Affairs

AIIB plans to issue first US dollar bonds in June 2018

China-led Asian Infrastructure Investment Bank (AIIB) is planning to issue its first US dollar-denominated bond with minimum worth of $1 billion by June 2018.

The earliest issuance window of bond will be toward end of first half of 2018 with time required for certain procedures, including Board of Governors’ approval of AIIB’s 2017 financial statements as well as borrowing and swap documentation.

Key Facts

The minimum size of the issuance will be one billion dollars, but as demand for the first bond issue may increase AIIB anticipates of having to issue a larger size.

The maturity of the bond will be between three and five years depending on investor demand at the time. he bank plans to cap its total borrowing volume at US $3 billion dollars in 2018.

The AIIB has received three top-notch ratings from global credit rating agencies S&P Global Ratings, Moody’s and Fitch in recognition of the bank’s strong capital base and stable outlook.

Asian Infrastructure Investment Bank (AIIB)

AIIB is a multilateral development bank initiated by China. Its purpose is to provide finance to infrastructure development and regional connectivity projects in the Asia-Pacific region. Its goals are to boost economic development in Asia-Pacific region, provide infrastructure, and promote regional cooperation and partnership.

It prioritises investment in energy, power generation, transport, rural infrastructure, environmental protection and logistics in Asia. It was officially established in December 2015 and opened for business in January 2016. It is headquartered in Beijing. It has an authorised capital of US $100 billion. So far it has 84 members including India.

China is the largest shareholder of AIIB with 26.06% voting shares. India is the second largest shareholder with 7.5% followed by Russia 5.93% and Germany with 4.5%.

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India to host 3rd Annual Meeting of Board of Governors of AIIB

India will host third Annual Meeting of the Board of Governors of Asian Infrastructure Investment Bank (AIIB) in Mumbai, Maharashtra in June 2018.

In this regard, Union Government and AIIB Secretariat have signed MoU to delineate duties and responsibilities of major stakeholders who would be involved in organizing the aforesaid Annual Meeting. The theme of the annual meeting is “Mobilizing Finance for Infrastructure: Innovation and Collaboration”.

Asian Infrastructure Investment Bank (AIIB)

The AIIB is multilateral financial institution proposed by China. Its purpose is to provide finance to infrastructure development and regional connectivity projects in the Asia-Pacific region. Its goals are to boost economic development in Asia-Pacific region, provide infrastructure, and promote regional cooperation and partnership.

It was founded in October, 2014 and became operational in January 2016. It is headquartered in Beijing. Currently, it has 56 member states. It is seen as rival to World Bank and Asian Development Bank (ADB).

The capital of AIIB is $100 billion, with almost $30 billion invested by China. India is one of the founding members of AIIB and 2nd largest shareholder in AIIB followed by Russia. The voting shares are based on size of each member country’s economy and not contribution to the bank’s authorised capital.

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