Regional Development Bank - Explained
What is a Regional Development Bank?
Written by J. Mance Gordon
Updated at April 17th, 2022
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Table of Contents
What is a Regional Development Bank?What Does a Multilateral Development Bank Do?Multilateral Development Banks by AssetsWhat is a Regional Development Bank?
The Regional Development Bank, RDB is a financial institution established to provide investment capital for startup businesses and businesses in low or middle-income countries. Regional Development Banks therefore provide financial assistance to businesses through the allocation of low-interest loans and grants for developing businesses. Also, RDBs are multilateral financial institutions established by a country or group of countries to help developing businesses both financially and technically. Four institutions are summed up to RDB, these are; African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD) and Inter-American Development Bank (IDB).
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What Does a Multilateral Development Bank Do?
Investment capital is crucial for any business to succeed, in fact, unavailability of funds can cripple businesses. RDBs help businesses financially and technically without seeking to maximise profits for shareholders.The development of business is importance to RDBs, this is why these Multilateral Development Banks, MDBs offer loans with low or no interest to developing businesses. They also offer grants to developmental projects in the major sectors of an economy such as agriculture, education, health and others. There are two main type of MDBs, the first form is made up of famous institutions while the other type is formed by governments of low-income countries.
Multilateral Development Banks by Assets
Multilateral Development Banks are listed according to their valuable possessions otherwise called assets. In MDBs or institutions, assets refer to tangible or intangible resources owned by these banks. In this segment, MDBs are listed in line with the size of their holdings and their balance sheets at the of 2016. European Investment Bank 573.2 billion ($666.3 billion) World Bank $307.3 billion Asian Development Bank $125.9 billion Inter-American Development Bank $113.3 billion European Bank for Reconstruction and Development 56.2 billion ($65.3 billion) African Development Bank 29.7 billion XUA ($21.6 billion, as of Sept. 2017) Asian Infrastructure Investment Bank $17.8 billion Islamic Development Bank 18.1 billion Islamic dinars ($12.9 billion) New Development Bank $10.0 billion Central American Bank for Economic Integration $9.2 billion