S&P Global Ratings released new guidance last week on how it rates and assesses risk at multilateral development banks — a change that could prove significant.
“The Multilateral Lending Institutions’ (MLI) criteria change will lead to meaningful improvements in capital positions and could unlock $600 billion to $800 billion in additional sovereign lending capacity,” S&P wrote in the introduction to a report released last week.
That means MDBs could collectively add billions to their balance sheets while retaining their current ratings, according to S&P. Development finance experts call it a “good sign” and a “step forward,” but stress it doesn’t mean MDBs can suddenly expand lending.
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About the author
Adva Saldinger@AdvaSal
Adva Saldinger is a Senior Reporter at Devex where she covers development finance, as well as U.S. foreign aid policy. Adva explores the role the private sector and private capital play in development and authors the weekly Devex Invested newsletter bringing the latest news on the role of business and finance in addressing global challenges. A journalist with more than 10 years of experience, she has worked at several newspapers in the U.S. and lived in both Ghana and South Africa.
