It’s not about the Money
Nena Stoiljkovic is the vice president of the International Finance Corporation (IFC), a member of the World Bank Group and the largest global development institution focused exclusively on the private sector. Leading the global business advisory services department, she sees some major shifts in global financial markets, is concerned about protectionist trends around the world and would like to work more with major companies from developed markets.
Ms Stoiljkovic, there are quite a few international financial institutions (IFIs) out there. What is IFC’s role today?
I think the key feature of IFC is that it is the only global development institution that focuses exclusively on the private sector. There are a number of regional players like the European Bank for Reconstruction and Development (EBRD), the African Development Bank and so on, but IFC is the only one that is active worldwide. That means we can draw from our experiences in a wide range of contexts such as the Latin American crisis, the Asian crisis and so on and adapt our work accordingly. The way we are set up is also unique in that we have three distinct units. There is typical funding, advisory services – which help us to actually deliver on a strategy rather than just fund it – and, the most recent addition, IFC Asset Management Company, a wholly owned subsidiary which invests directly in equity and is often funded by sovereign wealth funds.
Don’t you see a danger of many IFIs’ work overlapping too much?
I believe there is enough work for us all to do, so we do not really overlap. The greatest potential overlaps are in middle-income countries where there is very little left for IFIs to do. In such instances, we collaborate closely on very large transactions such as financing airports or other major infrastructure projects, sometimes worth more than USD 1 billion. These are usually so large that no IFI could either finance or even syndicate the necessary funds alone.
How much of your work is through commercial partner banks, and how much is directly with companies?
Roughly 55 percent of our business is with financial institutions and 45 percent with non-financial ones. In fact, we like to work directly with big companies and would like to expand this business further. We work with them to help extend our reach into parts of frontier countries where we cannot find suitable local clients.
And what’s in it for the client?
I don’t think people normally work with us just for the money. An IFC loan is sometimes more expensive than a loan from a commercial bank. Due to our structure and our limited range of products, we cannot offer loans at the same rates as commercial banks, which can cross-sell to clients and thereby reduce the rates for a specific credit line. IFC can only offer one particular loan tied to one particular product.
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