IFC AR18 Full Report

Annual Report 2018
Redefining
Development Finance
ABOUT
IFC
IFC, a member of the World Bank Group, is the largest
global development institution focused on the private
sector in developing countries.
Established in 1956, IFC is owned by 184 member countries,
a group that collectively determines our policies.
We have six decades of experience in the world’s most
challenging markets. With a global presence in about 100
countries, a network consisting of hundreds of financial
institutions, and about 2,000 private sector clients, IFC is
uniquely positioned to create markets and opportunities
where they are needed most.
We use our capital, expertise, and influence to help end
extreme poverty and boost shared prosperity.
CONTENTS
Letter from the IFC Board 2
Letter from Jim Yong Kim,
World Bank Group President 3
Letter from Philippe Le Houérou,
IFC CEO 6
Our Management Team 9
REDEFINING
DEVELOPMENT FINANCE 10
Mobilizing Private Solutions 24
Creating Markets 32
Promoting Sustainability 44
Ending Poverty 52
IFC YEAR IN REVIEW 62
IFC Operational Highlights 64
IFC Financial Highlights 65
World Bank Group Summary
Results 68
ABOUT US 72
Measuring Up 73
Our Expertise 76
Our People & Practices 84
Cover: To maximize finance for development, IFC follows

a decision-making sequence that prioritizes private sector
solutions. We call this approach the Cascade.
IFC ANNUAL REPORT 2018 | 1

LETTER FROM THE IFC BOARD
During fiscal 2018, the Board was actively involved in STANDING SEATED
the discussion with management on implementation (Left to Right) (Left to Right)
of the Forward Look vision for the World Bank Group.
Werner Gruber Melanie Robinson
An integral part of this discussion included a proposed Switzerland United Kingdom
capital package that would allow the Bank Group to Frank Heemskerk Christine Hogan
deliver development results more effectively — and in The Netherlands Canada
a financially sustainable manner. Turki Almutairi Máximo Torero
Saudi Arabia (Alternate) Peru
This transformative financial and policy package is Andrei Lushin Jason Allford
Russian Federation Australia
the largest injection of capital into the World Bank
Yingming Yang Bongi Kunene
and IFC to date, and it represents a major shift in China South Africa
approaches to address today’s toughest development Jean-Claude Tchatchouang Merza Hasan
challenges. Together with a commitment by Bank Cameroon (Alternate) Kuwait (Dean)
Group management to implement necessary internal Hervé de Villeroché Franciscus Godts
reforms, the package of initiatives will help support France Belgium
achievement of the 2030 development agenda, the Otaviano Canuto Patrizio Pagano
Brazil Italy
IDA18 vision, Maximizing Finance for Development, and
Kazuhiko Koguchi Juergen Zattler
will help the Bank Group continue to lead on global Japan Germany
public goods and scale up its support in fragile and Andin Hadiyanto Susan Ulbaek
conflict-affected situations. Indonesia Denmark
Erik Bethel Andrew N. Bvumbe
The Board also engaged on the shareholding review to United States (Alternate) Zimbabwe
rebalance shareholding among members, and agreed Fernando Jimenez Latorre
Spain
to reduce extreme under-representation in order to
Omar Bougara
realize voice reform and more closely align voting power Algeria
between the institutions of the Bank Group. The Board Aparna Subramani
has also provided guidance and direction on initiatives India
that enable the Bank Group to continue to improve
its business model — including through simpler and
more agile processes, strengthened strategic frame-
works, market creation and increased development
impact through the IFC 3.0 strategy, efficiency measures
in compensation and other expenses, and frameworks
and mechanisms to ensure financial sustainability.

LETTER FROM JIM YONG KIM
World Bank Group President
It’s not an exaggeration to say First, to accelerate inclusive, sustainable economic

that today’s challenges can seem growth, we need a new vision for financing develop-
ment — one that helps make the global market system
overwhelming. In our work around work for everyone and the planet. In a world where
the world, we’re facing overlapping achieving the Global Goals will cost trillions every year,
but official development assistance is stagnant in the
crises such as climate change, billions, we cannot end poverty without a fundamen-
tally different approach.
conflict, pandemics, natural disasters,
and forced displacement. We must With the adoption of the Hamburg Principles in July
2017, the G-20 endorsed an approach that we call the
simultaneously help our client Cascade, which will lead to our goal of Maximizing
countries address immediate crises, Finance for Development. The World Bank, IFC, and
MIGA are working more closely together to create
build resilience against challenges markets and bring private sector solutions in sectors
on the horizon, and make enduring such as infrastructure, agriculture, telecommuni-
cations, renewable energy, and affordable housing.
investments to prepare for an (Read more on page 5.)
uncertain future.
Second, to build resilience to shocks and
But even in difficult times, I have never been more threats — e ven as we continue developing c limate-
optimistic that we can achieve our twin goals: to smart infrastructure and improving response
end extreme poverty by 2030, and to boost shared systems — we need innovative financial tools to
prosperity among the poorest 40 percent around help poor countries do what wealthy ones have long
the world. Across the World Bank Group, we are done: share the risks of crises with global capital
harnessing new technologies and developing finan- markets. This spring, we saw the first impact of the
cial innovations to drive progress on the three parts Pandemic Emergency Financing Facility (PEF) with a
of our strategy to get there: accelerate inclusive, rapid grant to support the Ebola response surge in the
sustainable economic growth; build resilience to Democratic Republic of Congo. With this facility — and
shocks and threats; and help our client countries a similar one we are developing to improve responses
invest in their people. to and prevent famine — we are finding new ways to
help the poorest countries share risks with financial
markets, helping break the cycle of panic and neglect
that often occurs with crises.

LETTER FROM JIM YONG KIM
World Bank Group President
But resilience must start with the existential threat This year, we leveraged IDA’s strong capital base
of climate change. When we returned to Paris in and launched the inaugural IDA bond. Investor
December 2017 to celebrate the two-year anniver- demand for the $1.5 billion bond reached more
sary of the Paris Climate Agreement, we put more than $4 billion. By combining IDA’s traditional donor
than a dozen deals on the table to finance signif- funding with funds raised in the capital markets,
icant climate action such as preventing coastal this financial innovation will expand IDA’s ability
erosion in West Africa and scaling up renewable to support the world’s poorest countries, including
energy worldwide. It was critical to lead by efforts to prevent conflict.
example, and we announced that after 2019, we
will no longer finance upstream oil and gas while The International Finance Corporation (IFC) pro-
helping countries find sustainable ways to achieve vided more than $23 billion in financing for private
their development goals. sector development this past year, including
$11.7 billion mobilized from investment partners.
Of this, nearly $6.8 billion went to IDA countries,
Third, to prepare for a future where innova- and more than $3.7 billion was invested in areas
tions will only accelerate, we must find new ways affected by fragility, conflict, and violence.
to help countries invest more — and more effec-
tively — in their people. The jobs of the future will Marking its 30th year of operation, the Multilateral
require specific, complex skills, and human capital Investment Guarantee Agency (MIGA) has become
will become an increasingly valuable resource. With the third leading institution among the MDBs
the Human Capital Project, which we launched in terms of mobilizing direct private capital to
this year, we are developing a rigorous and detailed low- and middle-income countries. This year,
measure of human capital in each country. MIGA issued a record $5.3 billion in political risk
insurance and credit enhancement guarantees,
At the Annual Meetings in Indonesia in October helping finance $17.9 billion worth of projects in
2018, we will unveil the Human Capital Index, which developing countries. New issuances and gross
will rank countries according to how well they are outstanding exposure — at $21.2 billion this year —
investing in the human capital of the next genera- almost doubled as compared to fiscal 2013.
tion. The ranking will put the issue squarely in front
of heads of state and finance ministers so they can We know that the 2018 World Bank Group capital
accelerate investments in their people and prepare increase was a strong vote of confidence in our
for the economy of the future. staff, who work tirelessly to end poverty around
the globe. I am inspired every day by their dedica-
Around the world, demand continues to rise for tion and their ability to deliver on our ambitious
financing, expertise, and innovation. The needs commitments to meet the aspirations of the
are great — but the costs of failure are simply too people we serve.
high. Our shareholders are helping us meet that
challenge with their approval of a historic $13 billion But we also know that the capital increase rep-
capital increase, which will strengthen the World resents an enormous challenge to operate more
Bank Group’s ability to reduce poverty, address the efficiently and effectively, to drive innovation,
most critical challenges of our time, and help our and to accelerate progress toward a world that
client countries — and their people — reach their is finally free of poverty. In the year ahead, we
highest aspirations. will step up once again to meet that challenge
every day.
This year, the World Bank Group committed
nearly $67 billion in financing, investments, and
guarantees.
The International Bank for Reconstruction and

Development (IBRD) continues to see strong
demand from clients for its services, with commit-
ments rising to $23 billion in fiscal 2018. Meanwhile,
the International Development Association (IDA)
provided $24 billion to help the poorest countries — Jim Yong Kim
the largest year of IDA commitments on record. World Bank Group President

How a Unique
Strategy Is Helping
Egypt Overcome Its
Power Distress
Four years ago, the Arab Republic of Egypt faced a serious power crisis.
Hours-long power cuts affected businesses and the quality of life, while
demand for electricity exceeded supply by 20 percent. With scarce public
funds needed elsewhere, Egypt needed an alternative way to find the
resources needed to solve its power problems. That’s where the World Bank
Group’s emphasis on Maximizing Finance for Development (MFD) came in.
The MFD approach is a continuation of the World contracts for the Photovoltaic Solar Feed-in Tariff
Bank Group’s efforts to mobilize resources beyond (FiT) Program. In 2017, IFC finalized a $653 million
official development assistance to meet countries’ debt package to finance the construction of the
development needs. It leverages capabilities across Benban PV Solar Park, which will be the world’s largest
the Bank Group institutions to come up with innova- when complete. Benban’s 32 solar power plants will
tive solutions that will help achieve the Bank Group’s generate up to 752 megawatts of power, serve over
twin goals. More importantly, MFD envisages a key 350,000 residential customers, and generate up to
role for the private sector — both as financier and as 6,000 jobs during construction. MIGA has received
a source of knowledge. approval to provide up to $210 million in political
risk insurance for 12 projects within the solar park.
In 2014, the Egyptian government began working Overall, the World Bank Group and other lenders will
with the World Bank Group to address its energy mobilize a total of $2 billion of private investment
problems, bringing together local and global experts under the FiT program to support 1,600 megawatts
to develop a national strategy that prioritized of power generation.
energy sustainability and private sector investment.
This clear articulation of policy helped attract over Egypt’s energy sector is on the way to being
$30 billion of private investment by March 2015 transformed. Among other reforms, by 2016 the
into Egypt’s oil and gas production and in liquefied Government of Egypt halved subsidies to the sector —
natural gas. In December 2015, IBRD approved the to 3.3 percent of GDP — while keeping electricity
first of three programmatic loans to deliver the tech- tariffs affordable relative to global benchmarks, with
nical and financial support to achieve Egypt’s energy help from the World Bank Group. The energy sector
sector reform goals, committing more than $3 billion has become more efficient and financially sustain-
over 2015–17. able. The government has also improved the enabling
environment for the private sector, freeing up more
A key part of the reform program was to leverage public resources for use in critical social sectors.
Egypt’s abundant supply of sunshine. In 2015,
IFC worked with the government to develop the For more information, visit www.worldbank.org/mfd.

LETTER FROM PHILIPPE LE HOUÉROU
IFC Chief Executive Officer
Fiscal 2018 was a historic year for the

World Bank Group. Our shareholders
endorsed a $13 billion paid-in capital
increase for IBRD and IFC — including
$7.5 billion for IBRD and $5.5 billion
for IFC. For IFC, this capital increase
will more than triple the cumulative
paid-in capital that we have received
since inception.
$
$23.3B 30% 36% 45%
IN OF OUR OF OUR OF NEW ADVISORY
INVESTMENTS INVESTMENTS INVESTMENTS WERE PROJECTS INCLUDED
IN IDA COUNTRIES CLIMATE-RELATED A FOCUS ON GENDER
IMPACT

In addition, our shareholders agreed to suspend • IDA18 IFC-MIGA Private Sector Window, a $2.5 billion
IFC transfers to the International Development de-risking facility that helps address high-risk proj-
Association (IDA). As a result, the paid-in capital plus ects and overcome the challenge of limited access to
the saved retained earnings from the suspension of local-currency loans in IDA countries and in fragile and
IDA transfers will total $9.2 billion in additional capital conflict-affected areas. In FY18, we delivered our first
to support IFC operations between now and 2030. transactions and developed a pipeline of projects that
will benefit from this window in the next two years.
This constitutes a clear vote of confidence in our
strategic priorities for the years ahead. But it comes • Country Private Sector Diagnostics and Sector
with high expectations: We must deliver on our Deep Dives, which enable us to identify what needs
strategy to achieve high impact, particularly in some to be done to create markets in each country and
of the world’s toughest markets. We project that by in each sector. These two diagnostic pieces will serve
2030, we will have to more than double our annual as a base for strengthened country strategies. The
commitments to reach $48 billion in total. We pledged latter will outline the upstream agenda required to
to significantly increase our investments in IDA coun- enable the private sector to come in and help close
tries and in fragile and conflict-affected areas. We development gaps. They will also identify IFC’s specific
also pledged to step up our climate investments and advisory and investment program deliverables in
gender-related interventions. every country.
This year, we started to roll out the new tools and • Creating Markets Advisory Window, a funding facility
instruments designed the year before. At the same to support upstream work in IDA-eligible and fragile
time, we changed our organizational structure, and and conflict-affected countries. In FY18, resources
delivered record levels of investments. from this window enabled diagnostic work that is
helping us focus our advisory work to create markets
and develop project pipelines.
ROLLING OUT • Improved Project Selection, with two new tools.
NEW TOOLS AND The first is the Anticipated Impact Measurement

and Monitoring (AIMM) system, which assesses
APPROACHES proposed projects according to their ex-ante — or
expected — development impact. The AIMM method-
We rolled out new tools to reduce risks, select projects ology and associated scoring is fully functional for all
more strategically, and measure development results IFC investment projects since January 1, 2018; it will
more rigorously: be expanded to advisory projects in FY19. The second
is Carbon Pricing, which began May 1 for all project-
• To Maximize Finance for Development, the World finance investments in the cement, chemicals, and
Bank Group adopted a methodical approach that we thermal power sectors. This will help IFC select more
call the Cascade — a decision-making sequence that low-emission projects, in line with the recommenda-
prioritizes private sector solutions. As you can see on tions of the Report of the High-Level Commission on
the cover of this Annual Report, the Cascade can be Carbon Prices.
visualized as a series of waterfalls — each waterfall
representing a step along the private/public solution
and financing mix.

LETTER FROM PHILIPPE LE HOUÉROU
IFC delivered record levels

of investment finance in
FY18 — thanks to the talent
and dedication of our staff.
NEW This growth reflects an unprecedented level of

mobilization — at $11.7 billion in FY18 compared with
ORGANIZATIONAL $7.5 billion in FY17.
STRUCTURE Nearly 30 percent of our commitments went to

support development in the poorest countries:
To complement FY17’s organizational changes — those eligible to borrow from IDA. Climate-related
which included the creation of the Economics & investments accounted for a record 36 percent of our
Private Sector Development and the Partnerships, financing for the year. In addition, we increased our
Communications & Outreach teams — in FY18, focus on gender by helping women access financial
we focused on Operations and rebalanced the services, by supporting female entrepreneurs as they
matrix between IFC’s industry and regional teams expand their businesses, and by fostering gender
to better leverage the full range of resources and parity in the corporate world. We also continued to
capabilities available in IFC: deliver advisory solutions to clients in developing
countries — especially in IDA countries and in fragile
• A New Structure, which will allow us to fully and conflict-affected areas. About 57 percent of
benefit from our local presence and global sector IFC’s Advisory program was delivered to clients in
knowledge and expertise. This includes a Chief IDA countries and 19 percent in fragile and conflict-
Operating Officer to oversee all IFC operations. affected areas. Twenty-seven percent of the program
The teams under the new IFC Regional Vice was climate-related. In addition, almost 45 percent
Presidents are working in close collaboration of new advisory projects included a focus on gender
with Global Industry Senior Directors to deliver impact in project design — up from a third last year.
tailored solutions for each country. Guided by
substantive country strategies, stronger IFC We were also honored to receive more than 40 awards
regional teams also help us solidify our collabo- this year — a strong endorsement by third parties of
ration with the Bank and MIGA, and ensure that our ability to deliver innovative projects and solutions.
“the Cascade approach” is systematically designed
and implemented at the country level. This past year we laid the foundation for us to
implement the new IFC strategy — with our capital
• Advisory Reforms, which are establishing a increase, renewed support from our shareholders,
tighter link between our advisory and investment a new structure, and new tools and approaches to
work to prioritize upstream work and proactively deliver. This foundational work will position IFC
develop projects. At the end of FY18, we moved to actively participate in the “billions to trillions”
most of the cross-cutting advisory teams with agenda and the reshaping of development finance.
IFC investment staff. This will allow us to better
leverage our advisory experience and insights and
focus on Creating Markets priorities.
DELIVERING Philippe Le Houérou

Despite all these changes, IFC delivered record
levels of investment finance in FY18 — thanks
to the talent and dedication of our staff. IFC
provided a record $23.3 billion in financing to
private companies, up from $19.3 billion in FY17.

Philippe Le Houérou
OUR
MANAGEMENT
TEAM
Our leadership team ensures that IFC’s resources are deployed effectively, with a focus on
maximizing development impact and meeting the needs of our clients. IFC’s Management
Team benefits from years of development experience, a diversity of knowledge, and distinct
cultural perspectives. The team shapes our strategies and policies, positioning IFC to create
opportunities where they are needed most.
Stephanie von Friedeburg Georgina Baker Elena Bourganskaia Marcos Brujis

Chief Operating Officer Vice President, Latin America Chief of Staff CEO, IFC Asset Management
and the Caribbean, and Europe Company
and Central Asia
Karin Finkelston Mohamed Gouled Jingdong Hua Hans Peter Lankes

Vice President, Partnerships, Vice President, Risk and Financial Vice President and Treasurer Vice President, Economics and
Communication, and Outreach Sustainability Private Sector Development
Monish Mahurkar Sérgio Pimenta Nena Stoiljkovic Ethiopis Tafara

Vice President, Corporate Strategy Vice President, Vice President, Vice President, Legal, Compliance
and Resources Middle East and Africa Asia and Pacific Risk and Sustainability & General
Counsel

REDEFINING DEVELOPMENT FINANCE
MAXIMIZ
the PRIVATE
SECTOR’S ROLE
It is a new era.
Private sector solutions now stand at the forefront of development
thinking — addressing more difficult challenges, in more countries,
than ever before.
This requires mobilizing private investment at a far larger scale
than in the past — and steering it where it is needed most.
IFC is the global leader in this field, leveraging our many partner-
ships — b eginning with our Bretton Woods partner institutions, the
World Bank and the International Monetary Fund.

Scaling Up
IFC helped European asset manager Amundi launch
the world’s largest green-bond fund focused on
emerging markets. The fund is expected to deploy
$2 billion in support of c limate-f inance needs.
IZING
E

CHANGIN
the Way We
DO BUSINESS

Committed to
Innovation
Using the Cascade approach, IFC and other World
Bank Group institutions are helping Egypt attract
$2 billion in financing for the Benban Solar Park.
NG
To help meet today’s ambitious development goals, IFC has
hardwired its Creating Markets strategy for scaling up the
private sector’s role and has begun implementing it widely.
The strategy begins with the Cascade — a priority-setting
system central to the World Bank Group’s Maximizing Finance
for Development approach. This sparks the innovations and
reforms needed to attract new investment and increase the
impact of every dollar mobilized — especially in the poorest
countries and in fragile and conflict-affected areas.

This year, shareholders endorsed our new strategy with a record

$5.5 billion capital increase.
It is the largest capital increase by far that we’ve received in more
than six decades as the world’s largest global development finance
institution focused on the private sector. It will more than triple the
cumulative paid-in capital we’ve received since inception.
Now is the time to deliver on this historic vote of confidence — by
building on our strong base, and by working in new ways to extend the
private sector’s reach in creating jobs, reducing poverty, and increasing
living standards in the toughest areas of the developing world.
STRENGTH
Our CAPITAL

Entering
Tough Markets
Afghanistan’s production of raisins is expected to
double — benefiting 3,000 small-scale farmers —
because of IFC’s support for a state-of-the-art plant
being built by Rikweda Fruit Processing Company.
HENING
BASE

FINDI
New Ways to
RISK AND

IFC uses a wide set of de-risking tools
and platforms to clear the way for new
investment and widen its impact. They
increase investors’ appetite for entering
riskier markets, dismantling key barriers
that have held back capital flows.
These new instruments include both
blended finance vehicles and mobilization
platforms. They help us catalyze new
investment and expertise into high-
need areas, filling critical gaps across
the development landscape.
ING
to Balance
RETURN
New Tools
Using the new IDA18 IFC-MIGA Private Sector
Window, IFC is unlocking $500 million for
housing finance in West Africa, where few
can afford to buy their own home.

REDEFIN
IFC
It takes a broad approach to achieve big goals.
We start with new country strategies that identify the gaps and
outline the ways we can help the private sector fill them. This helps us
determine where we need to position our people, working alongside
our many clients and partners. And we use a new upfront results-
measurement system, rating our projects on their ability not just to
achieve impact but also to create markets.
As we rebalance our portfolio to achieve greater results in the poorest
countries, this integrated approach will be key to scaling up the impact
of every dollar we invest while supporting our clients’ business goals
and improving people’s lives.
We can do it. We must do it. We are doing it.

AMBITIONS
FOR 2030
• $25 billion in annual investments
NING
for IFC’s own account and
$23 billion in funds mobilized
from others
• 40 percent of investments in
IDA countries and in fragile and
conflict-affected areas — including
15 to 20 percent in low-income
and fragile and conflict-affected
IDA countries
• 35 percent of investments for IFC’s
own account are climate-related
• $2.6 billion in annual commitments
to financial institutions specifically
targeting women
• A fourfold increase in annual
financing dedicated to women
and women-led SMEs
• 50 percent of the directors
that IFC nominates to boards of
companies where we have a board
seat will be women

2018 GLOBAL
AWARDS
IFC and our clients received more than 40 awards
this year, highlighting our achievements in a broad
range of areas.
COLUMBIA PROJECT FINANCE

UNIVERSITY INTERNATIONAL
School of International and Public Affairs GLOBAL MULTILATERAL DEAL OF THE YEAR
for joint work with the European Bank for
GLOBAL LEADERSHIP AWARD honoring
Reconstruction and Development in support
“innovative or extraordinary contributions
of Egypt’s solar power program
to the global public good”
IJGLOBAL LATINFINANCE
DEVELOPMENT FINANCE MULTILATERAL DEVELOPMENT BANK
INSTITUTION OF THE YEAR OF THE YEAR for IFC’s “innovative approach
in the Middle East and North Africa and commitment to Latin America”

REGIONAL SOUTH ASIA
AWARDS
Global Agriculture
FY18
Leadership Awards:
EAST ASIA CSR Leadership Award for IFC
AND THE PACIFIC client DCM Shriram Ltd. (India)
Project Finance International: Greentech Foundation:

AWARDS Asia-Pacific Deal of the Year Gold Award in Chemical
Sector for DCM Shriram Ltd.’s
for Myingyan IPP (Myanmar)
outstanding achievement in
AsiaMoney China safety management (India)
Green Finance Awards:
Best Green International Bureau of Energy Efficiency
Financial Institution Ministry of Power, Government
of India: Best Performer
Singapore VC & PE Association: in Energy Saving for DCM
GLOBAL Partnerships Awards:
Best Utilities Project Gold
VC Deal of the Year for IFC
client Jungle Ventures
Shriram Ltd. (India)
AWARDS Medal and Projects Grand Prix IJGlobal:
for Kigali Bulk Water Supply Power Deal of the Year
Financial Times: EUROPE for Sirajganj 4 Dual Fuel
• FT Global GC 25 recognition PPP (Rwanda)
(Bangladesh), Hydro Deal of
for IFC VP and General Counsel TXF: Soft Commodities EMEA Finance: the Year for Karot Hydropower
Ethiopis Tafara Finance Deal of the Year Best Restructuring in (Pakistan), Water Deal of the
for IFC’s financing of Mercon Central and Eastern Europe Year for Clean Ganga Varanasi
• Innovative Lawyers
Coffee Group for AES Kavarna (Bulgaria) Wastewater (India), Midstream
Award for Innovation in
Legal Expertise: New Markets IJGlobal: Oil & Gas Deal of the Year
Stevie Awards:
and Capital European Airports Deal of for Moheshkhali Floating LNG
Best Annual Report in
the Year for Greece’s 14 Import Terminal (Bangladesh)
Fortune: Banking, Financial Services,
Regional Airports and Wind Deal of the Year for
Top 50 Change the World List Insurance & Real Estate
Sapphire 150MW Wind Farm
recognition for IFC client bKash ARC Awards: (Pakistan)
(Bangladesh) Gold Award for Best Annual LATIN AMERICA
AND THE CARIBBEAN Partnerships Bulletin:
International Financial Law Report from International
Special Award for the
Review Asia Awards: Development and Finance
LatinFinance: Bangladesh Dialysis PPP
Project Finance Deal of the Institutions
Best Loan, Best Sponsor,
Year for Myingyan Independent Best Infrastructure Financing: The Asset Triple A Asia
Graphic Design USA:
Power Producer (Myanmar) Mexico for Red Compartida Infrastructure Awards:
American Graphic Design
Wireless Telecommunications PPP Deal of the Year for
Award for IFC’s Annual Report
PPP (Mexico) Sembcorp North-West Power
League of American Company (Bangladesh) and
Communications PPP Awards & Conference: Renewable Energy Deal of
Professionals: Vision Award Most Innovative PPP of the the Year for Azure Power
for IFC’s Annual Report Year for São Paulo Roads PPP Energy (India)
(Brazil)
IJGlobal: SUB-SAHARAN AFRICA
Latin America Solar Deal
of the Year for Solem 1 and Africa’s Information
Solem 2 (Mexico) Technology & Telecom Awards:
CSR Initiative Award of the
Year for IHS Towers
MIDDLE EAST
AND NORTH AFRICA GlobalCapital Bond Awards:
Most Innovative Sub-Saharan
UN FRAMEWORK CONVENTION IJGlobal: Africa M
edium-Term Note
Infrastructure Program for Issuer
ON CLIMATE CHANGE Egypt Solar Program
IJGlobal:
MOMENTUM FOR CHANGE CLIMATE African Renewables Deal of
SOLUTIONS AWARD for leveraging “private- the Year for Bangweulu Solar
sector capital to develop and construct the PV (Zambia), African Water
world’s first large-scale concentrated solar Deal of the Year for Kigali Bulk
power plant,” KaXu Solar One in South Africa Water Supply PPP (Rwanda)
and African Upstream Oil &
Gas Deal of the Year for Vitol
Sankofa (Ghana)
GLOBAL WATER
AWARDS
WATER DEAL OF THE YEAR for making “the
biggest contribution to the advancement
of private sector participation in the
international water sector” with the Kigali
Bulk Water Supply project in Rwanda

REDEFINING
DEVELOPMENT
FINANCE
PAGE PAGE
24 32
MOBILIZING CREATING
PRIVATE MARKETS
SOLUTIONS

Across the world, debt has reached historic proportions. In the
wealthiest countries, it is at levels unseen since World War II.
In developing countries, it is at thresholds untested since the 1980s
debt crisis. That poses a formidable challenge to the global effort
to end extreme poverty by 2030 and boost shared prosperity.
Overcoming this challenge requires a new mind-set.
PAGE PAGE
44 52
PROMOTING ENDING
SUSTAINABILITY POVERTY

MOBILIZING
PRIVATE
SOLUTIONS
PAGE PAGE
26
DE-RISKING TOOLS:
28
MOBILIZATION:
Removing a Barrier Putting Private
to Progress in Capital to Work
Tough Markets for Development

IFC WORKS TO
MAXIMIZE FINANCING
FOR DEVELOPMENT.
PAGE
30
LOCAL CAPITAL MARKETS:
Building Private
Sector Growth
and Stability

Photo: In the least-developed
countries, IFC helps reduce invest-
ment risks to attract private
finance that will benefit the poor.

DE-RISKING TOOLS
REMOVING IFC and the World Bank Group have introduced
A BARRIER
several innovations to do exactly that. In FY18, we
teamed up with the World Bank’s International
Development Association to create the $2.5 billion
IDA18 IFC-MIGA Private Sector Window, a facility
TO PROGRESS
to accelerate private sector investment in IDA
countries — with a special emphasis on fragile and
conflict-affected areas. The facility enables IFC
and other investors in these countries to share
IN TOUGH investment risks with development institutions.
We used the window for the first time to unlock
MARKETS
$500 million for housing finance in West Africa,
where fewer than 7 percent of households can afford
to buy their own home. Using the window, IFC bought
$9 million in long-term local-currency bonds issued
by Caisse Régionale de Refinancement Hypothécaire
de l’UEMOA, a leading mortgage-refinancing com-
Each year, more than $1.5 trillion moves across pany. Our investment will enable the company to
international borders — as foreign direct investment expand its portfolio of housing loans by $500 million
that helps businesses and economies innovate and while deepening the local bond market.
grow. Most of it goes to just 10 countries. Barely
1 percent trickles into areas with the greatest need In the riskiest markets, IFC also works with a v
ariety
for investment: countries affected by conflict of development partners (see page 98) to help
and instability. private investors transfer some of their risks. We do
so, in part, through blended finance (see page 79) —
A key reason is risk — or investors’ perceptions of which involves using concessional donor funds to
it. In choosing where to put their money, investors mitigate specific investment risks. In FY18, IFC used
make complex judgments about an array of risks and $218 million of donor funds to catalyze $1.5 billion
uncertainties — financial, regulatory, legal, and political, in private investment.
among others. These tend to be greatest in the small-
est, poorest, and most fragile economies. Reducing IFC also plays a prominent role in facilitating
these risks — or enabling investors to share them more public-private partnerships (PPPs). Since 2004, IFC-
widely — can unlock significant private capital. structured PPPs have facilitated at least $27.5 billion
in private investment.
FY18 marked a milestone for an IFC-led PPP project

in Brazil that is modernizing infrastructure in the
state of São Paulo: concessions for three of four roads
in a 1,500-kilometer project were auctioned, setting
records for concession fees to the government and
establishing the foundation for about $4 billion in
new investment to complete the project. Our innova-
tive work prompted the national government to ask
IFC to structure similar PPPs at the national level.
$500M
UNLOCKED FOR
HOUSING FINANCE
IN WEST AFRICA

MOBILIZATION
PUTTING PRIVATE
CAPITAL TO WORK
FOR DEVELOPMENT
Across the world, at least $100 trillion in financing is available
from institutional investors — such as insurance companies,
sovereign funds, and pension funds.
That’s more than enough to cover the $4.5 trillion in financing that

developing countries need each year to achieve the Sustainable
Development Goals by 2030. But tapping the world’s vast pool
of private capital requires a new mind-set. Private investors can
be mobilized to help address the most urgent development chal-
lenges — provided investment risks and returns are balanced
appropriately.
IFC is a global leader in mobilizing private capital. We do it through

two major channels. The first is our loan-syndications program,
which since 1959 has mobilized $69 billion from over 500 financing
partners for around 1,000 projects in 115 countries. The second,
IFC Asset Management Company, has raised $10.1 billion in assets
from institutional investors — including $2.3 billion from IFC.
The Managed Co-Lending Portfolio Program is our main loan-

syndication platform. IFC created MCPP in 2013, when the People’s
Bank of China pledged $3 billion for investment in IFC projects.
Since then, the platform has more than doubled in size by including
a variety of global institutional investors. In 2017, the Hong Kong
Monetary Authority committed $1 billion to MCPP. This will support
financing of projects in over 100 countries.
We continue to introduce fresh innovations, including credit-

mobilization transactions. These transactions enable us to
provide more financing to our clients by leveraging the risk-bearing
capacity of insurance companies. Two recent examples are our
MCPP Financial Institutions and MCPP Unfunded Risk Participation
initiatives, which will tap $500 million apiece in unfunded credit
insurance from Munich Re, Liberty Specialty Markets, and Swiss Re
Corporate Solutions.
Credit mobilization helped IFC provide $185 million to Vietnam

International Commercial Joint Stock Bank, enabling the bank to
expand its portfolio of affordable mortgages and loans to small
and medium enterprises. Two global insurers, Liberty Mutual and
$69B
Munich Re, provided credit insurance to benefit the project. Overall,
in FY18, credit-mobilization transactions supported $325 million of
investments made for IFC’s own account.
In 2018, the IFC Emerging Asia Fund — managed by IFC Asset

Management Company — reached final close, having raised
MOBILIZED
$693 million to make g rowth-capital investments in 26 Asian THROUGH LOAN
countries. In Mozambique, we helped mobilize nearly $2.7 billion
from a variety of lenders to support the Nacala Corridor railway SYNDICATIONS
project. The newly built 912-kilometer line will connect two land-
locked countries — Zambia and Malawi — to the deepest port in SINCE 1959
southern Africa. It is expected to result in significant job creation
in the region — up to 1 million jobs by 2040.

Photo: IFC f inancing
is helping Vietnam
International Commercial
Joint Stock Bank widen
its portfolio of affordable
SME loans.

LOCAL CAPITAL MARKETS Deep and efficient local capital markets are
essential for lasting prosperity.
BUILDING They drive growth, helping companies to expand

and create more jobs. They help people buy homes,
PRIVATE SECTOR
pay for college, and save for retirement. They help
governments secure financing for roads, schools, and
hospitals. They shield local economies against an array
GROWTH AND
of financial hazards that can emerge from abroad.
Such markets, however, remain small in developing

countries. Although they account for more than
STABILITY a third of the world’s economic output, developing

countries represent just 10 percent of the capitaliza-
tion of stock markets worldwide. These countries also
constitute a disproportionately small share of the
global market for corporate bonds.
Photo (above): In Uzbekistan, IFC’s sum-

denominated bond raised $10 million to expand
lending to micro, small, and medium enterprises.

Photo (below): Peru is one of many countries that
could benefit from the World Bank Group’s Joint Capital
Markets Program to strengthen local capital markets.
IFC plays a vital role in strengthening local capital prices. In Uzbekistan, we launched the first sum-
markets in developing countries. We do so by issuing denominated bond to be issued in international
local-currency bonds, which can protect companies markets, raising $10 million to expand lending for
from the dangers of foreign-currency fluctuations. micro, small, and medium enterprises in the country.
We encourage a variety of global investors to par-
ticipate in the bond offerings. We help developing We take a systematic and coordinated approach to
countries draft policies and regulations for stronger developing capital markets. The Joint Capital Markets
capital markets. Often, we are the first international Program, launched in 2017 by IFC and the World Bank,
issuer of bonds in these countries. leverages the collective expertise of World Bank Group
institutions to accelerate capital markets develop-
Since 2013, our local-currency bond issuances have ment wherever it is needed most — beginning with
more than quadrupled, climbing from $183 million to Bangladesh, Kenya, Morocco, Peru, Vietnam, and the
close to $806 million issued in FY18. During this period, countries of the West African Economic and Monetary
we provided more than $13 billion in local-currency Union. The first joint capital markets diagnostic
financing in 74 different currencies — through loans, mission to Bangladesh took place in December 2017.
swaps, guarantees, risk-sharing facilities, and securi-
tized products. IFC’s Social Bond Program, launched in March 2017,
continues to expand. IFC has issued 18 social bonds
In Ukraine, we issued our first hryvnia-denominated in public and private markets across six currencies,
loan, providing the equivalent of $15 million to raising $980 million for more than 30 IFC projects that
Auchan Retail — one of the largest food retailers in benefit women-owned enterprises and businesses
the world — to finance its long-term investments that create opportunities for smallholder farmers and
in the country. Our investment will help create jobs low-income people.
while enabling low- and middle-income households
to obtain better-quality foods and goods at affordable

CREATING
MARKETS
PAGE PAGE PAGE
34
INFRASTRUCTURE:
36
TECHNOLOGY:
38
ACCESS TO FINANCE:
Accelerating Delivering High- Turning
Smart, Sustainable Tech Solutions Entrepreneurs’
Development Ideas into
Opportunities

WE FOCUS ON SECTORS THAT HAVE
THE GREATEST POTENTIAL TO CREATE
JOBS AND IMPROVE PEOPLE’S LIVES.
PAGE PAGE
40
AGRIBUSINESS:
42
HUMAN CAPITAL:
Boosting Farmers’ Promoting
Productivity and Access to Better
Incomes Education and
Health

INFRASTRUCTURE
ACCELERATING
SMART,
SUSTAINABLE
DEVELOPMENT
$7.4B
INVESTED
79M
PEOPLE BENEFITED
IN FY18 FROM POWER
GENERATION
Photo: The IFC-funded Rewa Ultra Mega Solar Park
in India will provide Delhi’s Metro Rail Corporation
with 80 percent of its daytime energy.

Few places are as barren as Egypt’s Western
Desert. But today, a 37-square-kilometer plot
near the city of Aswan is buzzing with con-
struction workers building what is expected In fiscal year 2018, IFC invested nearly $7.4 billion
to become the biggest solar installation in in core infrastructure projects, including funds
the world. mobilized from other investors. Our clients helped
generate power for more than 79 million people in
By 2019, the Benban Solar Park will churn out countries where such improvements are desper-
more than 1,600 megawatts of electricity — ately needed.
enough to power hundreds of thousands of homes
and businesses. IFC spearheaded a $653 million In India, the IFC-funded Rewa Ultra Mega Solar
financing package for the park — using the World Park is expected to become operational in late
Bank Group’s Maximizing Finance for Development 2018, providing the Delhi Metro Rail Corporation
strategy to marshal support from other Bank with 80 percent of its daytime energy. IFC
Group members and a consortium of nine inter provided a financing package totaling $289 mil-
national banks. lion — including funds mobilized from other
investors — to develop the 750-megawatt plant.
Modern infrastructure is essential to growth,
job creation, and quality of life. It requires Over the past decade, IFC has provided more than
$3.3 trillion in investments each year — far more $12 billion in financing for 350 urban infrastruc-
than the $2.5 trillion currently being spent. ture projects in emerging markets. In Argentina,
IFC works to bridge the gap by helping improve we provided a $300 million package to finance
access to energy, transportation, and municipal the construction of 17 kilometers of new roads,
infrastructure. underpasses, and bridges to complete the ring
road surrounding the city of Cordoba. The project
will help promote economic growth and create
job opportunities.
In Turkey, we agreed to finance a new tram line in

the city of Antalya. IFC will provide a €140 million
financing package to the city, enabling it to add
18 kilometers of track and 29 stations to its urban
rail transit system. The new tram line will carry
an additional 25 million passengers every year.
In Kazakhstan, we helped put together a landmark
public-private partnership to build and operate
the city of Almaty’s ring road, which will shorten
commutes by up to an hour.
In Vietnam, we agreed to lend $15.3 million to DNP

Water to help it increase access to clean water for
urban households and residents in smaller cities
across the country.

Rice. Eggs. Tomatoes. They top the grocery In Mexico, Red Compartida, the largest telecommuni
lists of many Bangladeshis. But for people in cations project in the country’s history, went live in
crowded cities like Dhaka, slogging through 2018 — well ahead of schedule. By 2024, the IFC-backed
traffic to get to the store is often more time- 4G-LTE voice and data platform is expected to provide
consuming than the shopping itself. access to online banking, health, communications, and
education services to more than 92 percent of Mexicans.
That’s why Waseem Alim started his successful
e-grocery delivery company, Chaldal, in 2013. Technology is also transforming Africa. In 2018, IFC
Chaldal leads a new wave of technology start-ups helped Partech Ventures launch a €100 million fund that
in Bangladesh, and has received venture capital is expected to become the largest venture-capital fund
from several investors, including IFC. focused on digital-technology start-ups in sub-Saharan
Africa. IFC’s €15 million equity investment is our first in
As Bangladesh and other emerging-market econ- a mainstream venture-capital fund in the region. We
omies develop a start-up investment culture, IFC also invested $6 million in Africa’s Talking, a mobile-tech
is committed to their active participation in the company that creates critical digital-infrastructure soft-
global e-marketplace. Modern information and ware for entrepreneurs across the continent.
communication technologies make it easier for the
poor to obtain access to services and resources. Large-scale changes are underway in China, too. Truck
These technologies create opportunities and make drivers and freight shippers across the country have
markets more efficient. improved their logistics operations by connecting
through Full Truck Alliance, an online marketplace also
IFC expands the availability of such technologies by known as “Uber for trucks.” The platform connects
channeling investments toward private companies long-haul drivers with shippers throughout the coun-
that build modern communications infrastructure try — which means these drivers no longer have to
and information-technology businesses. In FY18, share up to half of their earnings with intermediaries.
we invested $376 million in initiatives related to IFC invested $15 million for our own account. IFC Asset
technology, including funds mobilized from other Management Company mobilized an additional $32 mil-
investors — expanding our portfolio in this sector lion through the IFC Catalyst Fund and the IFC Global
to more than $2.4 billion. Emerging Markets Fund of Funds.

TECHNOLOGY
DELIVERING
HIGH-TECH
SOLUTIONS
Photo (left): Employees of IFC-backed Chaldal in

Bangladesh use technology to deliver more than
1,500 grocery orders a day.
Photo (right): An IFC fund helped Santiago Zavala
set up 500 Luchadores, a Mexico City company that
finances and coaches technology start-ups.

ACCESS TO FINANCE
TURNING
ENTREPRENEURS’
IDEAS INTO
OPPORTUNITIES

Zeina Khoury Daoud started selling artisanal olive
oil in Lebanon at age 22. Eager to make her mark as an
entrepreneur, she later launched a produce delivery
service and opened a franchise of organic grocery stores.
With each venture, she faced the biggest obstacle confront-

ing small and medium enterprises: access to finance. But
BLC Bank, an IFC client known for backing Lebanon’s SMEs,
stood by Khoury Daoud’s ideas, providing loans and advice at
every step. Her businesses have grown and she continues to
hire more employees.
Access to finance turns ideas into opportunities for entre-

preneurs everywhere — it’s essential to economic growth.
In developing countries, however, 2.5 billion adults lack a
bank account and 200 million businesses go without much-
needed credit.
IFC works through financial institutions to provide access

to finance to far more SMEs than we would be able to reach
on our own. In FY18, our clients provided nearly $365 billion
in SME loans. In addition, since 2005, we have invested over
$18 billion and worked with over 550 inclusive businesses in
more than 90 countries. These businesses serve low-income
and underserved populations.
In Lao PDR, IFC and Thailand’s TMB Bank teamed up in 2017

to provide $9.1 million in financing to ACLEDA Bank Lao. The
funding will help the bank bolster access to finance for the
country’s SMEs, especially those owned by women.
To reach even more people across emerging markets, IFC

worked with Crédit Agricole CIB on an innovative transaction
that will enable the bank to boost its trade-f inance activi-
ties and lend an additional $510 million to support health,
education, and other key services. Through the Synthetic
Risk Transfer transaction, we provided $85 million in c redit-
$365B
risk protection on Crédit Agricole CIB’s $2 billion portfolio of
emerging-market trade finance and corporate loans, enabling
it to expand lending.
IFC’s $200 million investment through offshore local-currency

IN SME LOANS bonds in India’s Housing Development Finance Corporation is
also helping to expand affordable housing. HDFC will allocate
PROVIDED BY IFC $600 million from its own resources to create a fund that will
CLIENTS finance the construction of 80,000 homes by 2022 — helping
to fulfill the country’s ambitious “Housing for All” plan.
In Turkey, where women entrepreneurs face a credit gap of

$5 billion, IFC invested $75 million in the first p
rivate sector
gender bond in emerging markets. The bond, issued by
Garanti Bank, is expected to triple the number of loans to
the bank’s women clients over the next five years.
Photo: Lebanese organic farmer Zeina Daoud

launched a successful organic-grocery franchise
and delivery service, backed by financing from
an IFC client.

AGRIBUSINESS
BOOSTING
FARMERS’
PRODUCTIVITY
AND INCOMES
Kakuy Ouanko’s family has relied — for genera- IFC supports programs that link smallholder farmers
tions — on the sale of cotton and cereals to earn a to modern supply chains, enabling them to adopt
living. The size of the crop determines how much farming practices that will increase productivity and
food his family will have for the year — and whether profitability. This is one element of our comprehensive
he can afford to send his children to school. approach to agribusiness. In FY18, our overall invest-
ments in agribusiness and forestry totaled nearly
Without access to proper inputs or technology, $1.6 billion, including funds mobilized from other
there’s little Kakuy can do to reduce his vulnerability investors. Our clients created opportunities for about
to bad weather. 3.7 million farmers.
But a project being implemented by the Société We work with the entire supply chain to build sus-
Burkinabè des Fibres Textiles (SOFITEX) — with support tainable food-production systems. To help clients
from IFC and the World Bank — aims to address this finance inventories, seeds, and farm chemicals, we
challenge in west Burkina Faso, where Kakuy lives. The offer working-capital facilities. To facilitate trade and
project provides farmers with financing and training reduce cost, we invest in infrastructure, including
for soil and water management, rainwater capture, ports and warehouses.
and irrigation to stabilize and increase cotton yields,
boosting their incomes. The goal is to reach 1,000 In India, we worked with the state of Odisha on a
farmers in four years — Kakuy being one of them. public-private partnership to develop, finance, and
maintain facilities for rice storage. The reserves will
Making smallholder farmers more productive and provide food security to the poor in remote areas of
resilient is an important step in the effort to end global the state, which is often hit by cyclones and other
poverty. About three-quarters of the world’s poor live natural disasters. The project is now being replicated
in rural areas, toiling on tiny plots of land that yield in other locations in Odisha, potentially benefiting
barely enough to support basic family needs. more than 300,000 people.
We also help agribusiness companies in developing

countries become more competitive. In Argentina, we
partnered with Rabobank to arrange a $410 million
finance package to help Renova build a new grain port
and boost its soy-processing capacity.
OUR CLIENTS
CREATED OPPORTUNITIES
FOR ABOUT
3.7M Photo: Ousmane Sie helps his company — IFC client

SOFITEX — change the lives of cotton farmers
through financing and better training.
FARMERS

IFC’s efforts in education reached Jordan — where
our $8.8 million investment in Luminus is helping
students gain skills tailored to economic needs — and
Africa, where our client Andela helps train and place
students in technology jobs across the globe. Market-
responsive education is a focus of IFC’s work in China,
where we arranged a syndicated local-currency loan
HUMAN CAPITAL of about $200 million for the micro-loan unit of the
PROMOTING ACCESS technology company Baidu. This unit finances tuition

fees for women enrolled in vocational training and
TO BETTER EDUCATION
business-focused institutions.
To assure the best match between a student’s edu-
AND HEALTH cation and her career prospects, we introduced an

Employability Assessment Tool that allows institu-
tions to evaluate the effectiveness of professional
placement services. The tool goes beyond indicators
Byju Raveendran is among the few to score like graduation and placement rates to assess the
100 percent on India’s famously difficult quality and relevance of learning — guiding educators
Common Admission Test, a post-graduate to tailor their offerings to better suit employers’ needs.
entrance exam.
We are working equally hard to improve people’s
Having spent a few years teaching others how access to quality health care. In the Kyrgyz Republic,
to ace the test, he became determined to solve an IFC public-private partnership is building six dialysis
a more basic problem — how to offer Indian centers that will serve more than 70 percent of the
students a world-class math education to prepare population. It is making possible at-home dialysis,
them for 21st-century jobs. Now, 900,000 users which citizens never had access to before — easing
across India pay for subscriptions to Byju’s, the hospitals’ load and reducing patients’ time, travel,
interactive app Raveendran created. Bolstered by and expense. A similar PPP in Bangladesh resulted
financing from IFC and other investors, the app is in an eightfold increase in the country’s capacity to
expected to help narrow India’s education gap. provide dialysis services. This addresses a significant
social need in a nation where fewer than 10 percent of
India is hardly the only country whose citizens people with end-stage renal disease receive dialysis
crave high-quality services that can help their treatment.
families thrive. Worldwide, IFC finances health
and education companies that move societies In Kenya, expanding access to quality retail pharmacies
forward. In FY18, we provided $769 million in is helping to transform health care. IFC’s investment
financing to such companies, including funds of $3 million in Goodlife Pharmacy helped the chain
mobilized from other investors. Our clients helped add over 70 new outlets. Goodlife has become East
provide education for 5.7 million students and Africa’s largest pharmaceutical retail company — oper-
delivered health care to 41.2 million patients. ating over 100 licensed pharmacies with cutting-edge
technology systems in high-traffic retail centers, gas
stations, and health clinics.
Photo (left): IFC investee Goodlife Pharmacies is
helping Kenyans access genuine high-quality drugs
through more than 100 outlets across the country.
Photo (below): In Nairobi, Mbarak Mbigo trains
software developers at Andela, an IFC client.

PROMOTING
SUSTAINABILITY
PAGE PAGE
46
SUSTAINABILITY:
48
CLIMATE BUSINESS:
A $12 Trillion Driving a
Opportunity for Greener Path
Businesses to Growth

SUSTAINABILITY IS AT
THE HEART OF EVERYTHING WE DO —
BECAUSE THE WORLD’S FUTURE
DEPENDS ON IT.
PAGE
50
GENDER:
Investing in
Women to Boost
Prosperity

SUSTAINABILITY
A $12 TRILLION
OPPORTUNITY FOR
BUSINESSES
It’s a formidable undertaking: Globally, as much as $7 trillion a
year in investments will be needed to achieve the Sustainable
Development Goals by 2030 — including up to $4.5 trillion in
developing countries. But along with the massive costs come
massive opportunities.
Businesses stand to gain at least $12 trillion a year in market oppor-

tunities by adopting sustainable practices and contributing in other
ways to achieving the goals, according to the Business & Sustainable
Development Commission. Surveys show businesses see many
compelling reasons to boost their performance on sustainabil-
ity — c ustomers and employees expect it, regulators and investors
demand it.
Emerging markets have joined the push toward sustainability

as well. The first Global Progress Report of the IFC-supported
Sustainable Banking Network shows that emerging markets have
become a major force in driving development and fighting climate
change: Thirty-four emerging-market countries have initiated bank-
ing reforms to expand sustainable lending.
Those 34 countries account for $42.6 trillion in bank assets — more

than 85 percent of total bank assets in emerging markets — and
all have made progress in advancing sustainable finance. Reforms
implemented require banks to assess and report on environmental
and social risks in their lending operations and put market incen-
tives in place for banks to lend to green projects.
For more than six decades, IFC has led the way in helping businesses
become more sustainable. The IFC Performance Standards (see
page 102) have become a global benchmark for sustainability prac-
tices. With these as a guide, our clients can craft business solutions
that are as good for communities and the environment as they are
for the bottom line.
Fifteen years ago, IFC’s environmental and social safeguards inspired

the Equator Principles — the beginning of rigorous environmental
and social standards for investment projects in the international
banking industry. Today, 94 financial institutions in 37 countries
have adopted the principles. Other leading development insti-
tutions — including the European Bank for Reconstruction and
Development and the Asian Development Bank — have adopted
practices rooted in our standards. In addition, our Corporate
Governance Methodology (see page 103) has been adopted by
35 development finance institutions.
Our push for green buildings continues. In Indonesia — a leading

emitter of greenhouse gases — we joined with local architects and
construction companies to promote green initiatives in new housing
projects. This will help cut annual greenhouse emissions by 1.2 mil-
lion metric tons, avoid 500 megawatt-hours of energy use, and save
almost $200 million per year by 2021.
This year, we launched the Disclosure and Transparency Toolkit, an

ambitious effort to create environmental, social, and governance
principles for capital markets. Global stock exchanges, regulators,
investors, and development and donor organizations see the toolkit
as important guidance for developing countries to use in advancing
transparency in their capital markets.

Photo (top): Across the world,
projects in which IFC invests
must follow the IFC Performance
Standards — a global benchmark
for sustainability practices.
Photo (bottom): The Ciputra
Residence — a green-buildings
project in Indonesia — illustrates
how IFC helps clients create
business solutions that are good
for the environment.
35
DEVELOPMENT INSTITUTIONS
ADOPTED IFC’S CORPORATE
GOVERNANCE METHODOLOGY

CLIMATE BUSINESS
DRIVING A GREENER
PATH TO GROWTH

Private investors increasingly have the appetite and
capacity to invest in climate-smart projects in emerging
markets. Yet they often lack the proper tools to make
investments happen.
That leaves a significant gap in financing available to tackle

climate change. Shifting to a greener path of growth could help
countries accelerate job c reation while cutting fuel costs and
saving lives. By 2030, it could also open up at least $23 trillion in
investment opportunities for businesses in some of the largest
emerging-market economies.
IFC plays a key role in advancing private sector solutions to

address climate change. In FY18, we provided $8.4 billion in
climate-smart financing, including a record $4.5 billion mobi-
lized from others. This accounted for 36 percent of our total
commitments for the year — including funds mobilized from
others — and exceeded our target for 2020. Our investments
are expected to help our clients reduce greenhouse emissions
by an estimated 10.4 million metric tons annually.
Our investment decisions increasingly are driven by climate-

related considerations. In three industry sectors where
greenhouse emissions tend to be high — thermal power gen-
eration, chemical and fertilizers, and cement — we now assign
carbon prices to encourage the adoption of technologies
and processes that will help lower emissions. This approach
reflects the recommendations of the Report of the High-Level
Commission on Carbon Prices.
Green bonds are an especially attractive financing tool for

infrastructure projects as they provide a potentially low-cost
and long-term source of capital. At the end of FY18, IFC had
issued a total of $7.6 billion in green bonds over the years. In
2018, we — along with Amundi, Europe’s largest asset manager —
launched the world’s largest targeted green-bond fund focused
on emerging markets, the Amundi Planet Emerging Green One.
$8.4B
The fund, which closed at $1.42 billion, is expected to deploy
$2 billion into emerging markets green bonds over its lifetime
as returns are reinvested.
PROVIDED IN In 2017, IFC led World Bank Group efforts, with support from
Australia, to help the Pacific Island nation of Fiji raise $50 mil-
CLIMATE-SMART lion through a sovereign green bond — the first to be issued
FINANCING by a developing nation, and the first of its kind to be listed on
the London Stock Exchange. Fiji needs investment of more
than $4 billion in the next 10 years to reduce its vulnerability
to climate change.
Photo: IFC helped the island nation Sustainable power generation is a priority area. In Serbia, we
of Fiji raise $50 million through a are helping the city of Belgrade turn its waste-disposal problem
sovereign green bond. into energy. The city generates 500,000 tons of waste each
year — and the current landfill constitutes a significant environ-
mental threat. In September 2017, we helped the city create a
public-private partnership to build and operate a complex that
will transform waste into energy and heat for the city.
In the Dominican Republic, IFC and Canada completed an

$80 million financing package — including $17 million in blended-
finance support — for the construction and operation of a new,
grid-connected, 50-megawatt wind farm. The Pecasa wind farm
will be one of the country’s largest and will reduce greenhouse
gases by a volume equivalent to taking 20,000 cars off the road.

GENDER
INVESTING IN
WOMEN TO BOOST
PROSPERITY
For years, Mansa Devi’s family struggled to pay her For women entrepreneurs, access to finance is key to
children’s school fees and buy their textbooks. their success. But they also need linkages to markets
and advice to overcome policy and legal barriers.
That changed in 2016, when she became an entre- To address their needs, IFC and the World Bank helped
preneur with Dharma Life, a distribution partner of set up the Women Entrepreneurs Finance Initiative,
IFC’s Lighting Asia/India program. Devi, who lives or We-Fi, with financial support from 14 governments.
in one of India’s poorest states, now goes door-to- Under the initiative, several multilateral development
door selling solar-powered lamps. Her income meets banks will offer finance and advice to public and pri-
her family’s needs, and the training has sharpened her vate institutions. We-Fi’s first round of financing is
sales acumen. When she pitches the solar lamps, expected to drive $1.6 billion in investments.
she reminds potential customers: “You can use them
to charge your mobile phones.” Through the Women Entrepreneurs Opportunity
Facility (WEOF), launched in 2014 by IFC’s Banking on
Women like Devi constitute a powerful force for Women program and Goldman Sachs’ 10,000 Women
economic growth and opportunity across the world. initiative, IFC has made over $1.1 billion in investments
In developing countries, they account for about a in 41 financial intermediaries in 29 countries — sur-
third of small and medium enterprises — the engine passing its original target size of $600 million. It has
of job c reation. They make up 41 percent of the formal also funded 9 advisory projects in 9 countries with
workforce worldwide. Yet they remain significantly total project value of $4.2 million.
underrepresented in most economic activities.
Research shows that increasing their participation IFC also publishes research that underscores the
could boost economic output by trillions of dollars business case for reducing the gender gap. Our
a year. Tackling Childcare report, for example, was designed
to help companies identify the type of childcare sup-
IFC works to expand that participation — by provid- port they can offer to their employees — while reaping
ing investment and advice that enables our clients gains through improved productivity. Another report,
to create opportunities for women, by conducting Driving toward Equality, explored how new technolo-
research that highlights the business case for gies like ride-hailing apps can enable women’s equal
gender inclusion, and by developing global and participation in the economy.
country-specific partnerships that support women
as employees, entrepreneurs, consumers, and busi- We also promote diversity in corporate leadership.
ness leaders. In FY18, our clients provided more Our Women on Boards program, and our collabora-
than 800,000 jobs to women in emerging econo- tions with regional women’s networks, encourage
mies, and delivered $11.4 billion in loans to small and corporations to retain diverse talent, cultures, and
medium enterprises owned by women. perspectives.
Photo (left): IFC’s Lighting Asia/India

program turned housewives like
Mansa Devi into successful earners.
She sells solar lamps.
Photo (right): Ung Sopheap, who
runs a weaving center in Phnom Penh,
Cambodia, grew her business with a
loan from IFC client ACLEDA Bank.

ENDING
POVERTY
PAGE PAGE
54
IDA AND CONFLICT-
56
SUB-SAHARAN AFRICA:
AFFECTED AREAS: A Continent of
Combating Opportunity
Poverty in the for Businesses
Toughest Areas

BY 2030, ABOUT HALF THE
WORLD’S POOR WILL LIVE IN AREAS
TORN BY CONFLICT AND VIOLENCE —
PARTICULARLY IN AFRICA, SOUTH
ASIA, AND THE MIDDLE EAST.
PAGE PAGE
58
SOUTH ASIA:
60
MIDDLE EAST
Helping 250 Million AND NORTH AFRICA:
People Escape Accelerating
Extreme Poverty Growth and Job
Creation

IDA AND CONFLICT-
AFFECTED AREAS
COMBATING
POVERTY IN
THE TOUGHEST
AREAS
K EN YA
KAKUMA REFUGEE
CAMP REPRESENTS A
$56M/YR MARKET
Poverty increasingly is concentrated in areas where it’s

hardest to eradicate.
About 1.3 billion people live in 75 of the world’s poorest

countries — those eligible to borrow from the World Bank’s
International Development Association. By 2030, nearly half
of the world’s extremely poor will live in fragile and strife-
torn areas.
IFC is taking a comprehensive approach to eradicate poverty

in these countries. We are helping to create or strengthen
institutions, mobilize investment, and promote private
entrepreneurship. By 2030, we expect 40 percent of IFC’s
annual investment commitments to be in IDA countries
and in fragile and conflict-affected areas.

Photo (above): The IFC-funded Rikweda raisin-
processing plant is helping 3,000 smallholder
farmers in Afghanistan — by buying their
produce at higher prices.
Photo (left): Refugees learn new skills at the
Kakuma camp in Kenya. An IFC report found that
the refugee camp represents a $56 million-
a-year market.
We began implementing the Creating Markets Advisory

Window, which addresses the growing need for advisory
solutions. Funding from the window is helping increase
access to affordable housing, promote clean electricity,
and boost the value of agriculture around industrial
parks in Haiti’s northeast corridor. It is supporting key
agribusiness initiatives in Nicaragua and strengthening
environmental and social standards in the Honduran
financial sector.
In addition, IFC and the United Nations High Commis-

sioner for Refugees published a report that identified
how private investment can improve the lives of people
in refugee camps. More than 160,000 refugees and dis-
placed people live in a refugee camp near the town of
Kakuma, Kenya. The refugees and the town depend on
each other for business and employment and represent
a market of at least $56 million a year, the report found.
IFC’s long-term investment commitments in IDA countries In Myanmar, we are helping remote communities connect
climbed to $6.8 billion in FY18, including funds mobilized to the outside world by supporting Yoma Micropower,
from other investors. Fifty-seven percent of our advisory which is using blended finance to set up hundreds of
program is in these countries. In FY18, our investments solar-based micro power plants across the country. By
in fragile and conflict-affected areas totaled $3.7 billion, 2022, about 2,000 of these plants will power commu-
including funds mobilized from other investors. Nearly nications towers and supply power to remote off-grid
20 percent of IFC advisory programs was in such areas. communities.
In 2018, the World Bank Group used a new tool — the IDA18 In Cambodia, we helped strengthen the local furniture
IFC-MIGA Private Sector Window — to help Afghanistan’s industry and integrate it with international markets.
Rikweda Fruit Processing Company build a state-of-the- IFC lent the equivalent of $26 million to Morris Holdings,
art raisin-processing plant. Once operational, the plant a China-based manufacturer of affordable furniture, to
will double the country’s production of raisins and support help the company build a modern production facility
3,000 smallholder farmers by buying their produce. in Sihanoukville.

SUB-SAHARAN AFRICA
A CONTINENT
OF OPPORTUNITY
FOR BUSINESSES
Sub-Saharan Africa is home to the largest number of Sub-Saharan Africa needs to create a large number
people in extreme poverty — about 400 million, more of jobs to keep up with its rapid population growth —
than the rest of the world combined. The region also a challenge small and medium enterprises are best
has more conflict-affected countries than any other. suited to address. In South Africa, we designed the
SME Push Program, which is creating partnerships with
Yet it is a continent of vast opportunity for businesses, the country’s largest banks to channel up to $3 billion
according to Shaping the Future of Africa, a new IFC report. By in investment into SMEs over the next seven years.
2030, 100 million people are expected to join Africa’s middle- Under the program, we agreed to lend up to $200 mil-
and high-income groups, boosting the total to more than lion to FirstRand to be used to support small and
160 million. Household consumption and business spending medium enterprises.
are growing rapidly — and could total $5.6 trillion by 2025.
In Zambia, we finalized financing — including $25.3 mil-
That means the private sector has a crucial interest lion in blended-finance support — for the construction
in addressing the region’s most urgent development of the country’s first large-scale solar power plants
challenges — its inadequate infrastructure, its rapid urban- under the World Bank Group’s Scaling Solar program.
ization, and its need for jobs that can lift people out of Low-cost renewable power from the two plants will help
poverty. IFC plays a comprehensive role here — by helping offset a drought-induced decline in hydropower. We also
businesses improve productivity and establish links to expanded the program to Senegal, where we are help-
broader markets, by expanding financial and social inclusion, ing the government add 60 megawatts to the country’s
and by boosting prosperity in ways that help limit conflict. power-generation capacity — at tariffs 60 percent lower
than those that prevailed in the past.
In FY18, our long-term investments in sub-Saharan Africa
totaled $6.2 billion, including $4.6 billion mobilized from IFC provided $7 million in financing — half of it blended
other investors. Our clients supported more than 278,000 finance — to Bonne Viande de Madagascar, or BoViMa,
jobs, created opportunities for more than 1 million farmers, to revitalize the country’s dwindling population of Zebu
and treated more than 1.4 million patients. One-third of our cattle. The company is building a modern feedlot and
global advisory program was in the region. slaughterhouse that will create an export market for
Zebu beef and goat meat, helping rebuild the country’s
cattle industry and creating jobs. Meanwhile, a World
Bank initiative will train veterinarians, rehabilitate
laboratories, and help provide better animal care, allow-
ing Madagascar to issue internationally recognized
animal health certificates. Zebu meat will be shipped
overseas through a modern port at Tolanaro, partly
funded by the World Bank.

Z A MBIA
$25.3M
IN BLENDED FINANCE
FOR THE CONSTRUCTION OF
THE COUNTRY’S FIRST LARGE-SCALE
SOLAR POWER PLANTS
UNDER THE WORLD BANK GROUP’S
SCALING SOLAR PROGRAM
Photo: Jackie Adriano is a construction

manager at BoViMa, an IFC client that is building
a world-class feedlot and slaughterhouse.

Photo: A fisherwoman in the Ganga
River in India. IFC is helping the govern-
ment clean up one of the world’s most
polluted rivers.
SOUTH ASIA
HELPING 250 MILLION
PEOPLE ESCAPE
EXTREME POVERTY
In a busy textile factory in Bangladesh, Krisno Kumar Das
carefully guides fabric into a dyeing machine, secure in
the knowledge that precious resources and money are no
longer swirling down the drain.
Not long ago, his employer, Textown, joined forces with the In 2017, we arranged a $125.7 million financing package for
IFC-led Partnership for Cleaner Textile (PaCT) to switch to Bangladesh’s first liquefied natural-gas import terminal.
more sustainable production methods. This slashed the When complete, the terminal will enable the state-owned
amounts of energy, dye, and chemicals the company used, Petrobangla to increase the country’s natural-gas supply by
and cut water consumption by 11 million liters per year — up to 20 percent, enough to support 3,000 megawatts of
equal to more than four Olympic-size swimming pools. power-generation capacity.
PaCT — which is funded by Australia, Canada, Denmark, and In India, we are supporting the country’s ambitious program
the Netherlands — has provided on-site assessments to to clean up the Ganga River. In FY18, we helped structure
more than 200 factories over the past five years. Its advice the first public-private partnership to enable private
has helped reduce water use by 21 billion liters per year in companies to build sewage treatment plants in Haridwar,
Bangladesh. These factories also cut energy consumption Mathura, and Varanasi — cities that discharge millions of
and reduced greenhouse emissions by 460,000 tons annu- liters of untreated sewage into the river. The three plants
ally — equivalent to taking 100,000 cars off the road. will process more than 200 million liters of sewage per day,
improving water quality for millions of people.
South Asia’s GDP growth rate of 6.5 percent is driven
mainly by India and Bangladesh. Private consumption is In Nepal, which depends heavily on tourism, we invested
strong and investment is buoyed by infrastructure projects $1.7 million in Himalayan Chain Resorts. IFC’s investment will
and reforms. Yet, despite the region’s recent economic help the company to expand its current chain of three lodges
progress, more than 250 million South Asians still live in to 10 along the Gokyo Lakes Trail and Everest Base Camp
extreme poverty. Trail in the Khumbu/Everest region of Nepal. The expansion
is expected to create 120 jobs.
That is why the region is a strategic priority for IFC. In FY18,
we provided $3.4 billion in financing for businesses in South
Asia, including $1.3 billion mobilized from other investors.
Our clients distributed gas to about 1.1 million customers,
provided more than 590,000 jobs, and created opportuni-
ties for more than 1.6 million farmers.
BA NGL A DE SH
ADDING3,000
MEGAWATTS OF
POWER-GENERATION
CAPACITY

MIDDLE EAST AND NORTH AFRICA
ACCELERATING
GROWTH AND JOB
CREATION

Ibrahim Hassouna isn’t surprised when
electricity fails at the Gaza plastics company
where he works.
On most days, up to dozens of blackouts halt

assembly lines and render the company’s 130
employees idle. “Every time the current goes out,
it delays production for up to 30 minutes,” says
Hassouna, a 41-year-old manager.
Hassouna’s frustration is felt across Gaza, which than 119,000 people, health care for more than
is facing one of its worst power crises. Gaza’s only 2.9 million people, and phone connections for
power plant suffers from lack of fuel, aging feed- about 1 million customers.
ing lines, and damage caused by wars. Blackouts
have devastated the territory’s manufacturing In Jordan, we helped IrisGuard improve the lives
sector, which has shriveled by 60 percent since of Syrian refugees. IrisGuard’s e-payment solu-
the late 1990s. tions — using iris-scanning technology — help
refugees access cash or goods quickly and easily.
IFC is helping reverse that decline. In 2018, we The company’s point-of-sale devices through-
launched a Maximizing Finance for Development out Jordan and the region will allow 2.3 million
initiative — working with other members of the Syrian refugees to withdraw cash at ATMs or pay
World Bank Group — to finance a $12 million solar for goods.
project in Gaza to ease the energy shortage.
The 7-megawatt rooftop solar-power plant will IFC is also helping to transform Iraq’s Salahaddin
provide critical energy to 32 factories in the Gaza Holding — a leading player in banking, construc-
Industrial Estate — much more cheaply than tion, and manufacturing — by bringing more
before. The project will create around 800 jobs. internal discipline and control to management
decision-making, clarifying responsibility, author-
Across the Middle East and North Africa, economic ity and roles, and improving the training of leaders.
growth rates have halved since 2011. Youth unem-
ployment is high, and conflict has displaced vast In Egypt, IFC made a $75 million equity investment
numbers of people. That’s why the region is a prior- in Apex International Energy, which aims to be
ity for IFC. In FY18, we invested more than $2 billion the country’s largest oil-and-gas production plat-
in the region, including $1 billion mobilized from form. IFC Asset Management Company mobilized
other investors. Our clients provided jobs for more an additional $25 million for the project. The
project is expected to increase Egypt’s oil-and-
gas reserves by the equivalent of 100 million
barrels of oil by 2023.
JOR DA N IR AQ
2.3M IFC IS HELPING

TO TRANSFORM
SYRIAN REFUGEES
SALAHADDIN
ABLE TO WITHDRAW
HOLDING —
CASH
A LEADING PLAYER
IN BANKING,
CONSTRUCTION, AND
MANUFACTURING
EGY P T
Photo (above): A worker making plastic parts in a $75M

Gaza industrial park, where IFC financed a 7-megawatt EQUITY INVESTMENT
solar plant that helped create 800 jobs. IN APEX
INTERNATIONAL
Photo (left): Nancy El Asmar, co-owner of Madera ENERGY
Creation in Beirut, launched a thriving furniture
business with financing from an IFC client.

IFC Year in
Review
In FY18, IFC invested $23.3 billion, including nearly $11.7 billion
mobilized from other investors. Our comprehensive approach
helped businesses innovate, build internationally competitive
industrial sectors, and create better jobs.
LATIN AMERICA
EAST ASIA AND EUROPE AND AND THE
THE PACIFIC: CENTRAL ASIA: CARIBBEAN:
$3.4 $2.9 $5
BILLION BILLION BILLION
in long-term in long-term in long-term

investment investment investment
commitments commitments commitments
$209 4.7 $103

BILLION MILLION BILLION
in micro, small, patients cared for in micro, small,

and medium loans and medium loans
provided provided
$10
$5.7 BILLION
$3.5
BILLION in goods and BILLION
services purchased
in goods and from domestic in financing
services purchased suppliers facilitated for
from domestic infrastructure
suppliers through public-
20 private partnerships
554,000 POLICY REFORMS
in 11 countries to 2.1
jobs provided support growth MILLION
and promote
investments students educated

MIDDLE EAST AND SUB-SAHARAN
NORTH AFRICA: SOUTH ASIA: AFRICA:
$2.0 $3.4 $6.2

BILLION BILLION BILLION
in long-term in long-term in long-term

investment investment investment
commitments commitments commitments
3 $49.7 33
MILLION BILLION POLICY REFORMS
patients cared for in micro, small, in 12 countries to

and medium loans support growth
provided and promote
$1.6 investments
BILLION
153
in goods and MILLION 1.3
services purchased MILLION
from domestic non-cash retail
suppliers transactions farmers benefited
facilitated, totaling
$7.9 billion
3.4 46.7
MILLION
$84 MILLION
people gained MILLION people gained

access to power access to power
in new investment
generated through
policy reforms

Operational Highlights
Dollars in millions, for the years ended June 30
2018 2017 2016 2015 2014
Long-Term Investment Commitments

FOR IFC’S OWN ACCOUNT $ 11,629 $ 11,854 $ 11,117 $ 10,539 $ 9,967
Number of projects 366 342 344 406 364
Number of countries 74 75 78 83 73
CORE MOBILIZATION1 $ 11,671 $ 7,461 $ 7,739 $ 7,133 $ 5,142
Syndicated loans2 $ 7,745 $ 3,475 $ 5,416 $ 4,194 $ 3,093
IFC Initiatives & Other $ 2,619 $ 2,207 $ 1,054 $ 1,631 $ 1,106
Asset Management Company (AMC) Funds $ 263 $ 531 $ 476 $ 761 $ 831
Public-Private Partnership (PPP)3 $ 1,044 $ 1,248 $ 793 $ 548 $ 113
TOTAL INVESTMENT COMMITMENTS $ 23,301 $ 19,316 $ 18,856 $ 17,672 $ 15,109
Investment Disbursements
For IFC’s account $ 11,149 $ 10,355 $ 9,953 $ 9,264 $ 8,904
TOTAL INVESTMENT DISBURSEMENTS $ 13,133 $ 12,602 $ 14,382 $ 12,075 $ 11,094
Committed Portfolio
Number of firms 1,977 2,005 2,006 2,033 2,011
For IFC’s account $ 57,173 $ 55,015 $ 51,994 $ 50,402 $ 51,735
TOTAL COMMITTED PORTFOLIO $ 73,383 $ 71,062 $ 68,544 $ 65,732 $ 66,993
Short-Term Finance
Average Outstanding Balance $ 3,435 $ 3,185 $ 2,807 $ 2,837 $ 3,019
Advisory Services
Advisory Services program expenditures $ 273.4 $ 245.7 $ 220.6 $ 202.1 $ 234.0
Share of program in IDA countries6 57% 63% 62% 65% 66%
1. Defined as “core mobilization” — f inancing from entities other than IFC that becomes available to client due to IFC’s direct involvement
in raising resources.
2. Includes B-Loans, Parallel Loans, and MCPP Loans.
3. Third-party financing made available for public-private partnership projects due to IFC’s mandated lead advisor role to national, local,
or other government entities.
4. Includes B-Loans, Agented Parallel Loans, and MCPP Loans.
5. Includes B-Loans, A-Loan Participations (ALPs), Structured A-Loan Participation Sales (SALPS), Agented Parallel Loans, Unfunded Risk
Participations (URPs) and MCPP Loans.
6. All references in this report to percentages of advisory program expenditures in IDA countries and fragile and conflict-affected areas
exclude global projects.

Financial Highlights
Dollars in millions, as of and for the years ended June 30*
2018 2017 2016 2015 2014

Net income (loss) attributable to IFC 1,280 1,418 -33 445 1,483
Grants to IDA 80 101 330 340 251
Income before grants to IDA 1,360 1,523 296 749 1,739
Total assets 94,272 92,254 90,434 87,548 84,130
Loans, equity investments and debt securities, net 42,264 40,519 37,356 37,578 38,176
Estimated fair value of equity investments 14,573 14,658 13,664 14,834 14,890
Key Ratios
Return on average assets (GAAP basis) 1.4% 1.6% 0.0% 0.5% 1.8%
Return on average capital (GAAP basis) 5.0% 5.9% -0.1% 1.8% 6.4%
Cash and liquid investments as a percentage of next
three years’ estimated net cash requirements 100% 82% 85% 81% 78%
Debt-to-equity ratio 2.5:1 2.7:1 2.8:1 2.6:1 2.7:1
Total resources required ($ billions) 20.1 19.4 19.2 19.2 18.0
Total resources available ($ billions) 24.7 23.6 22.5 22.6 21.6
Total reserve against losses on loans to total
disbursed loan portfolio 5.1% 6.1% 7.4% 7.5% 6.9%
* S
ee Management’s Discussion and Analysis and Consolidated Financial Statements for details on the calculation of these numbers:
http://www.ifc.org/FinancialReporting

FY18 Long-Term Commitments FY18 Long-Term
Dollar amounts in millions, for IFC’s own account as of June 30, 2018 Commitments by
Total $ 11,629 100.00%
Environmental and
By Industry Social Category
Financial Markets $ 5,509 47.37%
NUMBER
Infrastructure $ 2,073 17.83%
COMMITMENTS OF NEW
Agribusiness & Forestry $ 956 8.22% CATEGORY ($ MILLIONS) PROJECTS
Tourism, Retail & Property $ 764 6.57%
A 817 12
Funds $ 747 6.42%
Health & Education $ 739 6.36% B 4,225 148
Manufacturing $ 536 4.61% C 139 23
Telecommunications & FI5 23 0
Information Technology $ 207 1.78%
Oil, Gas & Mining $ 97 0.83% FI-1 754 12
FI-2 3,907 100
By Region1 FI-3 1,764 71
Latin America and the
Total 11,629 366
Caribbean $ 2,509 21.58%
Europe and Central Asia $ 2,256 19.40% 5. FI category applies to new commitments
South Asia2 $ 2,080 17.88% on previously existing projects. Visit
www.ifc.org/escategories for information
East Asia and the Pacific $ 1,940 16.89%
on category definitions.
Sub-Saharan Africa $ 1,566 13.25%
Middle East and North Africa2 $ 1,010 8.69%
Global $ 268 2.31% IFC’s Largest
By Product Country Exposures6
June 30, 2018 (Based on IFC’s Account)
Loans3 $ 9,804 84.30%
Equity4 $ 1,300 11.18% GLOBAL COMMITTED % OF
Guarantees $ 442 3.80% COUNTRY PORTFOLIO GLOBAL
Risk-management products $ 83 0.71% RANK ($ MILLIONS) PORTFOLIO
1 India 6,127 10.71%

2 Turkey 4,957 8.67%
FY18 Committed Portfolio 3 China 3,378 5.91%
Dollar amounts in millions, for IFC’s own account as of June 30, 2018
4 Brazil 2,877 5.03%
Total $ 57,173 100%
5 Bangladesh 1,520 2.66%
By Industry 6 Argentina 1,411 2.47%
Financial Markets $ 20,017 35% 7 Egypt, Arab

Infrastructure $ 11,370 20% Republic of 1,406 2.46%
Funds $ 4,640 8% 8 Colombia 1,343 2.35%
Manufacturing $ 4,515 8% 9 Pakistan 1,196 2.09%
Agribusiness & Forestry $ 3,866 7%
10 Mexico 1,192 2.09%
Trade Finance $ 3,527 6%
Health & Education $ 2,828 5% 6. Excludes individual country shares of
regional and global projects.
Tourism, Retail & Property $ 2,678 5%
Oil, Gas & Mining $ 1,976 3%
Telecommunications &
Information Technology $ 1,757 3%
By Region1
Caribbean $ 12,313 22%
Europe and Central Asia $ 10,345 18%
South Asia2 $ 9,898 17%
East Asia and the Pacific $ 9,045 16%
Sub-Saharan Africa $ 8,824 15%
Middle East and North Africa2 $ 4,905 9%
Global $ 1,842 3%
1. Amounts include regional shares of investments that are officially classified as
global projects.
2. Afghanistan and Pakistan, which previously were grouped under the Middle East
and North Africa region, are now grouped under South Asia. In FY18, these countries
accounted for $2 million of IFC’s commitments.
3. Includes loan-type, quasi-loan products.
4. Includes equity-type, quasi-equity products.

Weighted FY18 Investment Services DOTS Score
and Unweighted by Industry
Investment IFC Total 776 (45,275) 59%
Services DOTS Funds 98 (1,700) 64%
Manufacturing 58 (2,569) 64%
Scores Financial Markets 216 (26,282) 62%
Infrastructure 143 (6,454) 62%
FY18 Health & Education 56 (1,540) 61%
776 59% Oil, Gas & Mining 17 (1,351) 59%
$45,275 71% Agribusiness & Forestry 100 (3,047) 54%
Tourism, Retail & Property 46 (1,277) 48%
FY17
Telecommunications &
828 55% Information Technology 42 (1,054) 31%
$31,526 69%
Numbers at the left end of each bar are the total number of companies rated and the
FY16 total IFC investment (US$ millions) in those projects at the end of FY18.
834 58%
$32,751 68%
Unweighted Weighted
FY18 Investment Services DOTS Score
by Region
Numbers at the left end of each bar
for unweighted DOTS score are the total
number of companies rated. Numbers IFC Total 776 (45,275) 59%
at the left end of each bar for weighted Middle East and North Africa 64 (3,733) 66%
DOTS score represent total IFC investment East Asia and the Pacific 97 (6,452) 63%
(US$ millions) in those projects. Europe and Central Asia 140 (10,295) 61%
South Asia 123 (5,330) 59%
Sub-Saharan Africa 158 (8,228) 55%
Caribbean 173 (10,418) 54%
Numbers at the left end of each bar are the total number of companies rated and the
total IFC investment (US$ millions) in those projects at the end of FY18.
FY18 Advisory Services Program

Expenditures
Dollar amounts in millions
Total 273.4 100%
By Region
Sub-Saharan Africa 86.4 32%
East Asia and the Pacific 45.9 17%
South Asia* 42.0 15%
Europe and Central Asia 37.3 14%
Caribbean 29.6 11%
Middle East and North Africa* 15.2 6%
Global 17.1 6%
By Business Area
Financial Sector 78.8 29%
Investment Climate 60.3 22%
Cross-Industry Areas 55.3 20%
Public-Private Partnerships 34.5 13%
Energy & Resource Efficiency 25.3 9%
Agribusiness 19.1 7%
* Afghanistan and Pakistan, which previously were grouped under the Middle East
and North Africa region, are now grouped under South Asia. In FY18, these countries
accounted for $2 million of IFC’s commitments.

World Bank
Group
2018 Summary
Results

The Institutions of the World Bank Group
The World Bank Group is one of the world’s largest sources of funding and
knowledge for developing countries, consisting of five institutions with a common
commitment to reducing poverty, increasing shared prosperity, and promoting
sustainable development.
INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (IBRD)
Lends to governments of middle-income and creditworthy low-income countries.
INTERNATIONAL DEVELOPMENT ASSOCIATION (IDA)
Provides interest-free loans and grants to governments of the poorest countries.
INTERNATIONAL FINANCE CORPORATION (IFC)
Provides loans, equity, and advisory services to stimulate private sector investment in developing countries.
MULTILATERAL INVESTMENT GUARANTEE AGENCY (MIGA)
Provides political risk insurance and credit enhancement to investors and lenders to facilitate foreign direct
investment in emerging economies.
INTERNATIONAL CENTRE FOR SETTLEMENT OF INVESTMENT DISPUTES (ICSID)
Provides international facilities for conciliation and arbitration of investment disputes.
World Bank Group Financing for Partner Countries

by fiscal year, millions of dollars
World Bank Group 2014 2015 2016 2017 2018
Commitmentsa 58,190 59,776 64,185 61,783 66,868

Disbursements b
44,398 44,582 49,039 43,853 45,724
IBRD
Commitments 18,604 23,528 29,729 22,611 23,002
Disbursements 18,761 19,012 22,532 17,861 17,389
IDA
Commitments 22,239 18,966 16,171 19,513c 24,010d
Disbursements 13,432 12,905 13,191 12,718c 14,383
IFC
Commitmentse 9,967 10,539 11,117 11,854 11,629
Disbursements 8,904 9,264 9,953 10,355 11,149
MIGA
Gross issuance 3,155 2,828 4,258 4,842 5,251
Recipient-Executed Trust Funds

Commitments 4,225 3,914 2,910 2,962 2,976
Disbursements 3,301 3,401 3,363 2,919 2,803
a. Includes IBRD, IDA, IFC, Recipient-Executed Trust Fund (RETF) commitments, and MIGA gross issuance. RETF commitments include all
recipient-executed grants, and therefore total WBG commitments differ from the amount reported in the WBG Corporate Scorecard,
which includes only a subset of trust-funded activities.
b. Includes IBRD, IDA, IFC, and RETF disbursements.
c. Figures include the commitment and disbursement of a $50 million grant for the Pandemic Emergency Financing Facility.
d. Figure does not include $185 million in approved IDA18 IFC-MIGA Private Sector Window instruments, of which IDA has exposure of
$36 million in guarantees and $9 million in derivatives.
e. Long-term commitments for IFC’s own account. Does not include short-term finance or funds mobilized from other investors.

World Bank
Group Global
Commitments
The World Bank Group maintained strong support for developing
countries over the past year as the organization focused on delivering
results more quickly, increasing its relevance for its clients and
partners, and bringing global solutions to local challenges.
$66.9
in loans, grants, equity
investments, and guarantees
to partner countries and
BILLION private businesses.
Total includes multiregional and global projects. Regional breakdowns reflect

World Bank country classifications.

$6.8
BILLION
EAST ASIA AND THE PACIFIC
$8.8
BILLION
EUROPE AND CENTRAL ASIA
$8.7
BILLION
LATIN AMERICA
AND THE CARIBBEAN
$8.2
BILLION
MIDDLE EAST AND
NORTH AFRICA
$14.1
BILLION
SOUTH ASIA
$19.8
BILLION
SUB-SAHARAN AFRICA

About Us
IFC strives to deliver what cannot be obtained
elsewhere. We call that special edge our “additionality.”
Using it to maximize our development impact is a
cornerstone of our strategy.
73 MEASURING UP
74 How We Help End Poverty
and Boost Shared Prosperity
75 IFC’s Performance in Key Areas
76 OUR EXPERTISE
77 Where We Work
78 What We Do
82 Our Industry Expertise
84 OUR PEOPLE & PRACTICES

85 Understanding our
Development Impact
92 Corporate Responsibility
94 Our Governance
95 Accountability
96 Global Partnerships
99 Portfolio Management
100 Managing Risks
102 Our Sustainability Framework
104 Reporting under the Task Force on
Climate-related Financial Disclosures
106 Independent Assurance Report
on a Selection of Sustainable
Development Information
110 Financial Performance Summary

MEASURING
UP
IFC offers clients a unique combination of
investment and advice designed to promote
sustainable private sector development in
emerging markets. We use this special edge
to maximize our development impact.

How We Help End Poverty and
Boost Shared Prosperity
Our activities are guided by our determination
to create markets and mobilize private solutions
wherever they are needed most.
1 2
Expand our activities in
focus regions — wherever
Strengthen industries
linked to productivity
poverty and fragility growth, job creation,
are greatest. and inclusion.
3 4
Help address climate
change and promote
Strengthen local capital
markets and mobilize
environmental and social private capital.
sustainability.

IFC’s Performance in Key Areas
Focus Regions INDICATOR FY18 FY17
Middle East and North Africa Long-Term Investment Total Commitments (millions) $2,032 $8981
South Asia Long-Term Investment Total Commitments (millions) $3,406 $3,3421
Sub-Saharan Africa Long-Term Investment Total Commitments (millions) $5,953 $3,513
IDA and Conflict-Affected Areas

IDA Long-Term Investment Total Commitments (millions) $6,837 $4,590
IDA % Share of Advisory Services Program 57% 63%
FCS2 Long-Term Investment Total Commitments (millions) $3,721 $902
FCS % Share of Advisory Services Program 19% 20%
Infrastructure, Health & Education, Agribusiness & Forestry, and Financial Markets
Infrastructure Long-Term Investment Total Commitments (millions) $7,439 $3,122
Health & Education Long-Term Investment Total Commitments (millions) $763 $929
Agribusiness & Forestry3 Long-Term Investment Total Commitments (millions) $2,640 $2,121
Financial Markets Long-Term Investment Total Commitments (millions) $8,595 $8,576
Climate Change and Environmental & Social Sustainability

Climate-Related Investment Commitments (millions) $8,452 $4,776
% Share of Advisory Services Program 27% 26%
Mobilization
Core Mobilization $11,671 $7,461
Total commitments include funds invested for IFC’s own account as well as funds mobilized from other investors.
1. Pakistan and Afghanistan, which were previously grouped under the Middle East and North Africa, are now grouped under South Asia.
FY17 data have been revised to reflect that change.
2. FCS (Fragile and Conflict Situations). Since FY15, IFC’s data on FCS investments has included projects in countries that have been on
the World Bank’s Harmonized List of FCS at any time during the previous three fiscal years. This is designed to reflect the long gestation
period for investment projects and to encourage a longer-term organizational focus on these countries.
3. Agribusiness & Forestry includes fertilizers.

OUR
EXPERTISE
IFC blends investment with advice and
resource mobilization to help the private
sector advance development.

Where We Work
As the largest global development
institution focused on the private
sector, IFC operates in nearly 100
countries. We apply lessons learned
in one region to solve problems in
another. We help local companies make
better use of their own knowledge, by
matching it to opportunities in other
developing countries.

What We Do INVESTMENT
Our financial products enable companies to manage
risk and expand their access to foreign and domestic
IFC provides investment, advice, and
capital markets. IFC operates on a commercial
asset management. These are mutually basis. We invest exclusively in for-profit projects in
reinforcing, and deliver financing and developing countries, and we charge market rates for
our products and services.
global expertise to clients in developing
countries. Our offerings are designed to meet the specific needs
of IFC clients in different industries — with a special
focus on infrastructure, manufacturing, agribusiness,
Together, they give us a special services, and financial markets. In FY18, we made
$11.6 billion in long-term investments in 366 projects.
advantage in helping the private sector In addition, we mobilized nearly $11.7 billion to support
create opportunity — our investment the private sector in developing countries.
and advice can be tailored to a client’s PRODUCT LINES
specific needs, and in ways that add
value. Our ability to attract other Loans
investors brings additional benefits, IFC finances projects and companies through loans
introducing our clients to new from our own account, typically for seven to 12 years.
We also make loans to intermediary banks, leasing
sources of capital and better ways companies, and other financial institutions for
of doing business. on-lending.
While IFC loans traditionally have been denominated

in the currencies of major industrial nations, we
have made it a priority to structure local-currency
products. IFC has provided financing in 74 local
currencies.
In FY18, we made commitments for $9.8 billion in

new loans for our own account.
Equity
Equity investments provide developmental support

and long-term growth capital that private enterprises
need. We invest directly in companies’ equity, and
also through private-equity funds. In FY18, equity
investments accounted for about $1.3 billion of
commitments we made for our own account.
IFC generally invests between 5 percent and

20 percent of a company’s equity. We encourage the
companies we invest in to broaden share ownership
through public listings, thereby deepening local capital
markets. We also invest through profit-participating
loans, convertible loans, and preferred shares.
Trade and Commodity Finance
The IFC Global Trade Finance Program guarantees

trade-related payment obligations of approved
financial institutions. The program extends and
complements the capacity of banks to deliver
trade finance by providing risk mitigation on a
per-transaction basis for more than 287 banks across
87 countries.
In FY18, IFC had an average outstanding balance of

more than $3.4 billion in trade finance.

Syndications ADVICE
IFC’s Syndicated Loan Program is the oldest and Providing advice is a critical part of IFC’s strategy
largest among multilateral development banks. In to create markets and mobilize private investment.
FY18, it accounted for nearly two-thirds of the funds Through this work, we help establish the necessary
mobilized by IFC. conditions that will attract the most private capital,
enabling the private sector to grow.
In FY18, IFC syndicated $7.7 billion in B-loans, parallel
loans, MCPP loans, structured A-loan participations, That’s why we have shifted to a more strategic
and unfunded risk participations provided by approach, systematically linking our advisory
financial institutions. These included commercial programs to the greatest needs identified in World
banks, institutional investors, development finance Bank Group country and sector strategies. We will
institutions, and an emerging-markets central bank. focus increasingly on developing high-impact
The syndicated loan portfolio totaled $16.2 billion at projects that can help our clients attract the
the end of FY18. financing they need — particularly in the poorest
and most conflict-affected areas of the world.
More than 40 percent of the financing we provided
through syndications — $ 3.57 billion in all — went to
••We help companies attract private investors and
borrowers in IDA countries. partners, enter new markets, and increase their
impact. We provide tailored market insights as well
Derivatives and Structured Finance as advice on how to improve companies’ operational
performance and sustainability.
IFC makes derivatives products available to our
••We help industries adopt good practices and
clients, solely for hedging purposes. By allowing standards to increase competitiveness and
these companies to access international derivatives productivity.
markets to hedge currency, interest-rate or
••We help governments structure public-private
commodity-price risks, we enable them to enhance partnerships to improve people’s access to high-
their creditworthiness and improve their profitability. quality infrastructure and basic services. We help
In offering risk-management products, IFC acts governments implement reforms that encourage
generally as an intermediary between the market private investment.
and private companies in emerging markets. IFC
also provides structured-finance products for clients IFC’s advisory platform consists of seasoned experts,
seeking to raise funds on global and local capital and about 80 percent of our advisory staff are based
markets and manage financial risk. IFC has assisted in the field. In FY18, our advisory portfolio grew to
first-time client issuers in accessing the markets $1.5 billion, encompassing 741 advisory projects in
through partial credit guarantees. We also assist about 100 countries. Fifty-seven percent of IFC’s
clients in structuring and placing securitizations with advisory program was in IDA countries, 19 percent in
capital-markets investors. fragile and conflict-affected areas, and 27 percent of
our advisory program was climate-related.
Blended Finance
HOW WE WORK WITH COMPANIES
IFC uses several tools to crowd in private financing
that would otherwise not be available for high- Agribusiness: We help companies improve
impact development projects. We blend concessional productivity and standards — among other things,
funds — t ypically from development partners — with by creating efficient value chains, ensuring food
our own financing and that of our co-investors. security, and providing strong economic, social, and
Blended finance can help mitigate early-entrant costs environmental benefits for smaller farming enterprises
or project risks, enabling pioneering investments and communities.
and creating a track record that paves the way for
commercial investments. IFC has historically applied Infrastructure and Natural Resources: We help
this approach in climate change, agribusiness and companies provide benefits to local communities and
food security, and SME financing — a lthough the mitigate local risks in projects.
introduction of the IDA18 IFC-MIGA Private Sector
Window (see page 27) has opened up opportunities for Corporate Finance Services: We help companies
us to support many other sectors. Our approach to enter new markets, attract investors, and structure
blended finance is principled and judicious — d esigned complex projects, offering advice on the design and
to address market failures, avoid market distortions, execution of mergers, acquisitions, and partnerships.
uphold transparency, and enhance development
impact. In FY18, we committed more than $218 million Energy and Water Advisory: We help companies
of concessional donor funds, catalyzing $1.5 billion in use energy and water more efficiently to enhance
private investment. performance and environmental sustainability. We
also accelerate the development of renewable-energy
markets and improve people’s access to modern
energy services.

Green Buildings: We offer tools and training to HOW WE WORK WITH GOVERNMENTS
help companies construct buildings that use energy,
water, and materials more efficiently. We also help Public-Private Partnerships: We help governments
governments establish related policy frameworks and design and implement PPPs that are tailored to
work with banks to launch green-finance products. local needs, help solve infrastructure bottlenecks,
and achieve national development goals.
Small and Medium Enterprises and Value Chains:
We help SMEs strengthen their skills and performance, Financial Sector: We work with governments and
improving their ability to participate in the supply the private sector to build resilient, transparent,
and distribution networks of larger firms. We advise and smooth-functioning financial systems and
companies and governments on how to improve capital markets.
working conditions and boost the competitiveness
of the textile sector’s supply chain. Investment Climate: We help improve the business
environment through reforms that promote
Gender Equality: We work with companies to investment, spur growth, and create jobs.
enhance the recruitment, retention, and promotion
of women. We also help them increase women’s 2030 Water Resources Group: We bring together
access to financial services, technology, information, governments, civil society, and the private sector to
and markets. identify investment needs and drive reform to address
water scarcity.
Strategic Business Solutions: We help companies
resolve complex business challenges, structure
innovative programs, and create new market IFC ASSET MANAGEMENT
opportunities. COMPANY
Corporate Governance: We help companies improve IFC Asset Management Company, LLC, a wholly
access to capital, mitigate risk, and safeguard against owned subsidiary of IFC, mobilizes and manages
mismanagement by improving their corporate capital for businesses in developing countries and
governance. frontier markets. Created in 2009, AMC provides
investors with unique access to IFC’s emerging-
Environmental and Social Risk Management: markets investment pipeline, while also expanding
We help integrate environmental and social risk- the supply of long-term capital to these markets.
management considerations into companies’ AMC enhances IFC’s development impact and
operations to achieve long-term success. generates profits for investors by leveraging IFC’s
global platform and investment standards.
HOW WE WORK WITH FINANCIAL INSTITUTIONS
AND FUNDS As of June 30, 2018, AMC had raised approximately
$10.1 billion, including about $2.3 billion from IFC.
Financial Institutions: We help clients strengthen It manages 12 investment funds covering equity, debt,
risk management and diversify product offerings and fund-of-fund products on behalf of a wide variety
in categories such as SME finance, gender, housing of institutional investors, including sovereign wealth
finance, and sustainable energy. We also promote funds, pension funds, and development-finance
universal access to finance, strengthen capital institutions.
markets, and establish credit bureaus and
collateral registries. AMC FUNDS
Fund Managers: We help develop the private equity
IFC Capitalization Fund
industry in frontier markets and provide advice to
fund managers and SMEs in which the funds invest. The $3 billion IFC Capitalization Fund consists of
two sub-funds — a n equity fund of $1.3 billion and
a subordinated debt fund of $1.7 billion. Launched
in 2009, the fund helped strengthen systemically
important banks in emerging markets, bolstering
their ability to cope with financial and economic
downturns. As of June 30, 2018, the fund had made
41 investment commitments totaling $2.8 billion.

IFC African, Latin American, and Caribbean Fund IFC Global Emerging Markets Fund of Funds
The $1 billion IFC African, Latin American, and Launched in 2015, the $800 million IFC Global
Caribbean Fund was launched in 2010. The fund Emerging Markets Fund of Funds invests mainly in
invests in equity and equity-related investments private equity funds that are focused on growth
across a range of sectors in sub-Saharan Africa and companies in various sectors across emerging and
in Latin America and the Caribbean. As of June 30, frontier markets. The fund also invests directly in such
2018, the fund had made 38 investment commitments companies. As of June 30, 2018, the fund had made
totaling $879 million. 18 investment commitments totaling $397 million.
Africa Capitalization Fund IFC Middle East and North Africa Fund
The $182 million Africa Capitalization Fund was Launched in 2015, the $162 million IFC Middle East
launched in 2010 to invest in systemically important and North Africa Fund makes equity and equity-
commercial-banking institutions in Africa. As of related investments in the MENA region. As of
June 30, 2018, the fund had made eight investment June 30, 2018, the fund had made three investment
commitments totaling $130 million. commitments totaling $52 million.
IFC Catalyst Fund Women Entrepreneurs Debt Fund
The $418 million IFC Catalyst Fund was launched in The $115 million Women Entrepreneurs Debt Fund,
2012 and invests in funds that provide growth capital launched in 2016, extends senior loans to commercial
to companies developing innovative ways to address banks for on-lending to women-owned small and
climate change in emerging markets. It also may medium enterprises in emerging markets. This is a
invest directly in those companies. As of June 30, component of the $600 million Women Entrepreneurs
2018, the fund had made 19 commitments totaling Opportunity Facility, a partnership established in
$382 million. March 2014 between IFC and the Goldman Sachs
10,000 Women initiative. As of June 30, 2018, the fund
IFC Global Infrastructure Fund had made investment commitments to eight banks
amounting to $87 million.
The $1.2 billion IFC Global Infrastructure Fund was
launched in 2013 and co-invests with IFC in equity IFC Emerging Asia Fund
and equity-related investments in the infrastructure
sector in emerging markets. As of June 30, 2018, the The $693 million IFC Emerging Asia Fund, launched
fund had made 21 investment commitments totaling in 2016, makes equity and equity-like investments
$662 million. across all sectors in emerging markets in Asia. As of
June 30, 2018, the fund had made three investment
China-Mexico Fund commitments of $90 million.
Launched in 2014, the $1.2 billion China-Mexico Fund

is a country-specific fund that makes equity, equity-
like, and mezzanine investments along with IFC in
Mexico. It focuses on infrastructure, oil and gas, and
other sectors, including manufacturing, agribusiness,
services, and banking. As of June 30, 2018, the fund
had made three investment commitments totaling
$270 million.
IFC Financial Institutions Growth Fund
The $505 million IFC Financial Institutions Growth

Fund is a follow-on fund to the IFC Capitalization
Fund and makes equity and equity-related
investments in financial institutions in emerging
markets. As of June 30, 2018, the fund had made four
investment commitments totaling $133 million.

Our Industry Expertise AGRIBUSINESS AND FORESTRY
Agribusiness has an important role to play in poverty

reduction. The agricultural sector often accounts
IFC’s leadership role in sustainable for at least half of GDP and employment in many
private sector development reflects developing countries, making it a priority for IFC.
a special advantage — the depth and IFC provides support for the private sector to
breadth of expertise we have acquired address demand for agricultural commodities in an
environmentally sustainable and socially inclusive
over 60 years of helping emerging- way. To help clients finance inventories, seeds,
market firms succeed and grow. fertilizers, chemicals, and fuel for farmers, IFC offers
working-capital facilities. To facilitate trade and lower
costs, we pursue investments in infrastructure such
We have moved to leverage our global as warehouses and cold-storage facilities. To bring
land into sustainable production, we work to improve
industry knowledge to tackle the biggest
productivity by transferring technologies and making
development challenges of the coming the best use of resources.
years — including unemployment, climate
In FY18, our new long-term commitments for our own
change, and food and water security. account in agribusiness and forestry totaled about
$956 million.
FINANCIAL INSTITUTIONS
Sound, inclusive, and sustainable financial markets

are vital to development because they ensure
efficient resource allocation. IFC’s work with financial
intermediaries has helped strengthen financial
institutions and overall financial systems. It has
also allowed us to support far more micro, small,
and medium enterprises than we would be able to
on our own.
Working through financial intermediaries enables

IFC to encourage them to become more involved in
sectors that are strategic priorities — such as women-
owned businesses and climate change — and in
underserved regions such as fragile and conflict-
affected states as well as in housing, infrastructure,
and social services.
In FY18, our new long-term commitments for our

own account in financial markets totaled about
$5.5 billion.
HEALTH AND EDUCATION
Health and education are basic human needs — but

they remain beyond the reach of many people in
developing countries.
Expanding access to health and education is a

central element of any strategy to end poverty and
boost prosperity. IFC supports health care and life-
sciences companies — b y providing financing, sharing
industry knowledge, raising management and clinical
standards, helping shape government policy, and
supporting public-private collaboration. In education,
we help private enterprises complement the work of
the public sector and create more opportunities for
children, youth, and working adults.

IFC is the world’s largest multilateral investor in IFC’s mission in the oil, gas, and mining sector is to
private health care and education. In FY18, our new help developing countries realize these benefits,
long-term commitments for our own account in while helping promote sustainable energy sources.
health and education totaled $739 million. We provide financing and advice for private sector
clients, and also help governments adopt effective
INFRASTRUCTURE regulations and strengthen their capacity to manage
these industries across the value chain.
Modern infrastructure spurs economic growth,
improves living standards, and can represent an We support private investment in these industries,
opportunity to address emerging development and we work to ensure that local communities
challenges, including rapid urbanization and enjoy tangible benefits. In FY18, our new long-term
climate change. commitments for our own account in the sector
totaled $97 million.
It is also an area in which the private sector can make
a significant contribution, providing essential services TELECOMMUNICATIONS AND INFORMATION
to large numbers of people — efficiently, affordably, TECHNOLOGY
and profitably. This is IFC’s focus: supporting private
infrastructure projects whose innovative, high-impact Modern information and communication technologies
business models can be widely replicated. make it easier for the poor to obtain access to
services and resources. They expand opportunity and
We help increase access to power, transportation, make markets and institutions more efficient. IFC
and water. We advise client governments on public- works to extend the availability of such technologies.
private partnerships. We work to improve urban We channel investments toward private companies
infrastructure and related services. We mitigate that build modern communications infrastructure
risk and leverage specialized financial structuring and information-technology businesses, and develop
and other capabilities. In FY18, our new long-term climate-friendly technologies.
commitments for our own account in this sector
totaled about $2 billion. IFC helps clients move beyond their own national
borders and into other developing markets. In FY18,
MANUFACTURING our new commitments for our own account in this
sector totaled $207 million.
The manufacturing sector plays a vital role in creating
opportunity and reducing poverty in developing TOURISM, RETAIL, AND PROPERTY
countries. IFC’s manufacturing clients tend to create
or maintain more employment than those in any The tourism, retail, and property sectors contribute
other sector. significantly to job creation, tax revenues, and
economic growth for developing countries.
We have increased our activities in the sector,
which includes chemicals, construction materials, IFC works to strengthen all three in developing
energy-efficient machinery, and transportation countries. Our investments promote the development
machinery. We invest in and advise companies of critical infrastructure — in places where there is
that are developing new products and markets, often a shortage of high-quality hotels for tourists
and are restructuring and modernizing to become and business visitors. We work with our retail clients
internationally competitive. to create jobs, contribute to the tax base, build
local banking capacity, improve infrastructure, and
As these industries represent some of the most raise labor standards. We also invest in property
carbon-intensive sectors, we are helping clients companies to expand affordable housing and
develop and undertake investments that help commercial real estate.
reduce carbon emissions and energy consumption.
In FY18, our new long-term commitments for our
In FY18, our new long-term commitments for our own account in tourism, retail, and property totaled
own account in the manufacturing sector totaled $764 million.
$536 million.
OIL, GAS, AND MINING
Industries that can harness natural resources are vital

for many of the world’s poorest countries. They are a
key source of jobs, energy, and government revenues.
They also provide a wide array of other benefits for
local economies. In Africa, in particular, large-scale
sustainable investments in these industries can create
equally large-scale gains in economic development.

OUR
PEOPLE &
PRACTICES
IFC’s commitment to alleviating
poverty and creating opportunity
for the developing world’s most
vulnerable people is reflected in
our corporate culture.

Understanding Our
Development Impact
IFC is at the forefront of development-
impact measurement for private
sector operations. We are one of the
few international financial institutions
that set corporate targets for direct
development impact. Measuring the
results of our work is at the heart of what
we do. It is critical to understanding
how well our strategy is working — and
whether IFC and our clients are reaching
the people and markets that most need
our help.
IFC’S IMPACT ASSESSMENT AND

RESULTS-MEASUREMENT SYSTEM
IFC has developed a comprehensive system to guide

operations to achieve strong development impact
and improve our performance each year. The process
begins with country and sector diagnostics and
identification of priorities and potential projects.
It is buttressed by an assessment of anticipated
development impact that informs project selection
and design. It is deepened by regular monitoring of
operational project results and, eventually, selective
evaluation of mature projects to identify impacts
achieved and lessons learned.
Diagnostics: Our work begins with a diagnosis of

the needs of the private sector in specific countries.
IFC introduced a new tool — Country Private Sector
Diagnostics (CPSDs) — to identify constraints to
AN END-TO-END 1
SUPPORT SYSTEM DIAGNOSTICS
FOR IMPACT Inform sector focus and
ASSESSMENT project selection; identify
country priorities
2 3 4
PROJECT RESULTS EVALUATION
RATINGS MEASUREMENT Promotes
Drive Identifies learning and
project achievements accountability
selection and lessons ex-post
and design learned
ex-ante
Monitoring / Feedback

private sector investment, pinpoint sectors that MONITORING: IDENTIFYING ACHIEVEMENTS
have the greatest potential for private sector AND LESSONS LEARNED
engagement, and recommend specific activities to
drive developmental priorities. This approach enables Our results-measurement system uses a multi-tiered
the World Bank Group, governments, and partners approach to enhance IFC’s contributions to the
to define development challenges and take concrete World Bank Group’s twin goals — b y helping improve
actions to address them. new business decisions and increasing the value of
monitoring and evaluation. Since 2006, IFC has tracked
Working closely with the World Bank, IFC has development impact through DOTS — a framework
completed CPSDs for Ghana and Kazakhstan and has that helps us monitor and assess the performance of
started work in 13 other countries across the globe. all IFC’s active investment client companies. Over the
More will follow over the next three years. next few years, the AIMM system will progressively
incorporate relevant elements of the DOTS system,
AIMM: IMPROVING PROJECT SELECTION providing an “end-to-end” approach to results
AND DESIGN measurement.
In 2017, IFC introduced a new project-impact- An important feature of the AIMM system is its
assessment tool that strengthens our results capacity to link ex-ante project ratings with real-time
measurement framework — the Anticipated Impact results-measurement findings. It is an evidence-based
Measurement and Monitoring (AIMM) system. system — in which estimates of expected development
Under this system, proposed projects are rated and impact are explicitly tied to monitoring indicators.
selected on the basis of their ex-ante — o
r expected — Under the AIMM system, there is at least one tracking
development impact. This approach enables us to indicator associated with every impact claim used to
set ambitious yet achievable targets, select projects justify an ex-ante rating.
with the greatest potential for development impact,
and optimize project design. With the system in place, EVALUATIONS: PROVIDING EVIDENCE AND
IFC is now better able to select a mix of projects that PROMOTING ACCOUNTABILITY
deliver high development impact and solid financial
returns. We continue to work to refine the system. Evaluations of mature or completed projects provide
the final link in the impact-assessment framework.
The AIMM system enables IFC to assess a project’s Each year, IFC undertakes self-evaluations of a
outcomes as well as its effect on market creation. sample of maturing investment operations and
It looks at how investment beneficiaries — including completed advisory services projects. These ratings
employees, customers, and suppliers — a re affected. form the basis of performance assessments for
It also examines broader effects on the economy IFC overall and feed into sector, thematic, and
and on society. The system enables IFC to examine regional assessments. They are then validated by
how a project promotes objectives that underpin the Independent Evaluation Group.
IFC’s efforts to create markets — by promoting
competitiveness, resilience, integration within and IFC also conducts in-depth evaluations of mature
across markets, inclusiveness, and sustainability. projects or clusters of projects. Since 2017, IFC has
adopted a more strategic approach to evaluations
In 2018, IFC began scoring all new investment projects designed to fill critical knowledge gaps. We undertook
using the AIMM framework. The part of the system 27 evaluations and applied-research efforts focusing
that involves monitoring is being integrated with on practical issues facing operations and affecting
the current Development Outcome Tracking System the effectiveness of our interventions. In doing so,
(DOTS). The AIMM system for advisory services will be we are able to assess IFC’s impact beyond individual
developed during FY19. projects — w
e also capture useful lessons that inform
industry strategies and operations.
For example, an assessment of the Global Agriculture

and Food Security Program (GAFSP), one of IFC’s
blended-finance facilities, showed that IFC’s unique
approach — involving a combination of investment
and advisory services — adds significant value to
agricultural markets in IDA-only countries. By blending
IFC’s commercial financing with GAFSP’s concessional
funds, IFC was able to reach new clients and markets
in countries that are often perceived as too risky
by investors.

In FY17, GAFSP-supported projects reached over IFC THOUGHT LEADERSHIP IN RESULTS
874,000 farmers in countries with high poverty rates MEASUREMENT
and severe food insecurity. GAFSP also leveraged
significant additional capital — investments of Among multilateral development banks and
approximately $250 million catalyzed a total of development finance institutions, IFC is at the
$1.6 billion in investment. forefront of monitoring and evaluation for private
sector operations. One illustration of this is our
IFC’s 2012 investment in the Abengoa KaXu Project, work to create a Community of Practice among
a 100-megawatt concentrated solar plant (CSP) in international finance institutions for evaluation of
South Africa, also illustrates the value of evaluations. private sector operations.
The KaXu Project, partly financed with concessional
funding from the Clean Technology Fund, was the In March 2018, IFC jointly hosted the second Annual
first privately financed CSP in sub-Saharan Africa. Evaluating Private Sector Development Impact Conference
The project provided 1,700 construction jobs and 80 in London with the CDC Group, the United Kingdom’s
full-time positions — well above employment targets. development finance institution. Representatives from
It also produced enough energy to serve an additional 31 development partners, multilateral development
33,000 customers while avoiding an estimated banks, and international finance institutions attended.
306,000 metric tons of carbon dioxide a year. The conference highlighted the importance of
producing clear, credible evidence of how private
THE IFC DEVELOPMENT GOALS: SUPPORTING investment contributes to achieving the SDGs. It also
THE IFC STRATEGY underscored the challenges of assessing market-
creation impacts.
The IFC Development Goals complement the AIMM
system to identify reach-related goals that our IFC’S PERFORMANCE AND DEVELOPMENT
projects are expected to achieve. These goals cover IMPACT
five areas aligned with our strategy that have a direct
impact on people’s lives in the markets we serve: As the Independent Evaluation Group has noted, IFC’s
development-effectiveness ratings have declined
••Creating sustainable farming opportunities in recent years for both investment and advisory
••Improving health and education services services — partly because of slower economic growth,
••Providing more access to financial services for depressed commodity prices, and political turmoil in
microfinance and SME clients many countries. Weaknesses in project selection and
••Increasing or improving infrastructure services supervision have also contributed to the decline.
••Reducing greenhouse emissions
IFC is taking several steps to address these issues —
We work with our clients to estimate specific including strengthening accountability in the project
development impacts we expect to achieve over time selection and implementation process. IFC is also
with every investment and advisory commitment we conducting semi-annual portfolio reviews of all
make. In the second year of the current three-year advisory projects to ensure proactive management
cycle (FY17–19), IFC made good gains in commitments and timely corrective actions.
toward the goals in FY18. More information is
available on our website at https://www.ifc.org/ In FY18, 59 percent of our investments were positively
developmentgoals. rated — u
p four points from FY17. The improvement
showed across all performance areas. These
IFC’S CONTRIBUTION TO THE SDGs DOTS rating scores are based on a cohort of 776
investments approved between 2009 and 2014 that
IFC’s results monitoring is aligned with the United were mature enough to be rated.
Nations’ Sustainable Development Goals (SDGs)
adopted in September 2015. In particular, the AIMM Larger IFC investments performed better, with
system helps IFC maintain a line of sight from our own 71 percent rated positively.
strategic objectives to the World Bank’s twin goals
and the SDGs. By design, the AIMM system measures Among industry sectors, investments in private
project-level and systemic outcomes against equity funds performed the best — with 64 percent
SDG-related objectives. This approach has positioned of investments rated positively. Investments in the
IFC to play a key role among international finance tourism, retail, construction & real estate sector
institutions in reporting how we — and our clients — registered the biggest improvement — 4 8 percent of
contribute to achieving the SDGs. More information investments were rated positively, up 14 points from
about how IFC contributes to the SDGs is available FY17. This increase was driven principally by improved
online at https://www.ifc.org/sdgalignment. DOTS scores in sub-Saharan Africa and Latin America
and the Caribbean, where two-thirds of IFC’s projects
in this sector are located.

The DOTS score declined for the telecommunications, ••We helped create or enhance five credit-bureau
media, and technology sector. Thirty-one percent operators in Morocco, Mongolia, Nigeria, Jordan,
of investments in this sector were rated positively — and Azerbaijan.
a decline of six points from FY17. The decline was
concentrated in three regions — L atin America and Providing Solutions and Services:
the Caribbean, Europe and Central Asia, and South
Asia, where clients’ financial performance was weaker ••More than 17 million people benefited from IFC
than expected. advisory work in support of off-grid solar solutions.
••Our clients generated and distributed power to
Among regions, investments in the Middle East and 97.2 million people, many of them in sub-Saharan
North Africa performed best. Sixty-six percent of Africa and South Asia. They provided phone
investments in the region were rated positively — u
p connections to 186.7 million people, mostly in South
16 points from FY17. The increase reflected stronger Asia. They distributed gas to 3.1 million people,
performance of investments in the nonfinancial sector. mostly in South Asia.
••Our clients helped educate 5.7 million students.
In FY18, 66 percent of completed advisory projects Our agribusiness clients supported 4 million
were rated positively — d
own four points from FY17, farmers through improved access to finance and
but still above our target of 65 percent. This score markets and through sustainable farming practices.
reflected the performance of 136 projects that were These benefits are expected to improve farmers’
completed during the year and were eligible for productivity and income and enhance their ability
development-effectiveness ratings. to cope with unexpected events.
••We worked with firms to adopt new practices
Three regions showed a marked improvement in and technologies that attracted financing
performance. Europe and Central Asia was the of $121.2 million through resource-efficient
strongest performer, with 88 percent of projects rated technologies projects.
positively. Projects in South Asia, sub-Saharan Africa, ••IFC helped governments sign 17 contracts with
and Latin America and the Caribbean experienced a private operators. These transactions are expected
performance decline. to improve access to infrastructure and health
services for 6.1 million people and mobilize over
CLIENTS’ DEVELOPMENT REACH AND RESULTS $4.6 billion in private investment in infrastructure.
Across the globe, IFC investment and advisory clients Improving the Business Environment:
reached many people and recorded some remarkable
achievements (see page 89). Here are a few ••In collaboration with the World Bank, we supported
highlights: 35 national and local governments to implement
73 reforms that helped improve the enabling
Improving Access to Finance: environment for private sector development and
foster competitive markets and job creation.
••IFC provides investment and advice to financial Fifty-one reforms were in IDA countries, including 13
institutions that serve individuals and micro, small, in fragile and conflict-affected areas.
and medium enterprises. These institutions provided ••These reforms led to $85.5 million in private sector
about 54.4 million micro and 8.3 million small and savings and contributed to more than $142 million in
medium loans totaling nearly $439 billion. They also new investments.
provided 2.3 million housing finance loans totaling
$69.8 billion.
••We supported our partners in digital financial
services to facilitate over 366 million non-cash retail
transactions, totaling $10 billion.
••We helped strengthen country financial markets by
working with collateral registries and credit bureaus
that facilitated $146.8 billion in financing. More
than 302,000 micro, small and medium enterprises
received loans secured with movable property.
••Loans totaling $444 million were disbursed to agri-
borrowers and in the housing sector for energy
efficiency.

Development reach by IFC’s clients
PORTFOLIO PORTFOLIO
Investments CY16 CY17
Employment (millions of jobs)1 2.4 2.5
Microfinance loans 2, 3
Number (millions) 53.7 54.4

Amount ($ billions) 60.7 73.9
SME loans2, 3
Trade Finance4
People reached with services

Power generation (millions of people)5 78.1 79.2
Power distribution (millions of people) 24.8 18.0
Water distribution (millions of people) 14.3 18.2
Gas distribution (millions of people) 59.9 3.1
Phone connections (millions of people) 345.3 186.7
Patients served (millions) 34.0 41.2
Students reached (millions) 4.9 5.7
Farmers reached (millions) 3.0 3.7
Payments to suppliers and governments

Domestic purchases of goods and services ($ billions) 36.6 38.3
Contribution to government revenues or savings ($ billions) 14.6 15.8
These figures represent the total reach of IFC clients as of end of CY16 and CY17. CY16 and CY17 portfolio data are not strictly
comparable, because they are based on a changed portfolio of IFC clients. For microfinance and SME loans, the results also reflect
contributions from Advisory Services. While numerous controls are performed on the data provided by clients, they are sometimes based
on estimates, and the understanding of the indicator definitions may vary slightly between clients.
1. Portfolio figures for employment include jobs provided by fund investee companies, representing 35% of the total.
2. Portfolio reach figures represent the micro, small and medium outstanding loan portfolio of IFC’s financial institution clients with
MSME-oriented finance.
3. Reported Microfinance and SME data include a substantial contribution from a large institution in Asia.
4. The total number and dollar volume of trade transactions financed by the Global Trade Finance Program’s network of emerging-market
banks are based on actual data from 76% (number) and 79% (dollar volume) of the network’s active banks for CY17. The figures are
not directly comparable to last year’s due to variance in the number of active banks who submitted survey responses. Numbers reflect
transactions directly guaranteed by IFC as well as those executed by network banks that have been supported by the program. CY16
data have been updated to reflect prior-year data corrections from survey participants.
5. The number of CY16 total power generation customers reached has been revised due to the restatement of one client value in South
Asia and one client value in Latin America and the Caribbean.

Investment Services DOTS Investment Services DOTS
score by performance area, score by region, FY17 vs. FY18
FY17 vs. FY18 % Rated Positively
% Rated Positively
IFC Total
59%
Development Outcome
55%
59%
Middle East and North Africa*
55%
66%
Environmental & Social Performance
49%
70%
East Asia and the Pacific
69%
63%
Private Sector Development Impact
59%
70%
Europe and Central Asia
67%
61%
Economic Performance
56%
52%
South Asia*
49%
59%
Financial Performance
55%
41%
Sub-Saharan Africa
39%
55%
FY18 FY17
53%
Latin America and the Caribbean
54%
Investment Services DOTS 54%
score by industry, FY17 vs. FY18 FY18 FY17
% Rated Positively *Projects in Afghanistan and Pakistan, which previously were

grouped under the Middle East and North Africa region, are
now grouped under South Asia. The FY17 number has been
IFC Total recalculated to incorporate the change.
59%
55%
Funds
64%
60%
Manufacturing
64%
54%
Financial Markets
62%
58%
Infrastructure
62%
54%
Health & Education
61%
60%
Oil, Gas & Mining
59%
48%
Agribusiness & Forestry
54%
59%
Tourism, Retail & Property
48%
34%
Telecoms & IT
31%
37%
FY18 FY17

Advisory Services DOTS score Advisory Services DOTS score
by region, FY17 vs. FY18 by business area, FY17 vs. FY18*
% Rated Positively % Rated Positively
IFC Total IFC Total

66% 66%
70% 70%
Europe and Central Asia Agribusiness
88% 100%
70% 67%
East Asia and the Pacific Energy & Resource Efficiency
69% 85%
57% 43%
South Asia* Financial Sector*
65% 75%
93% 77%
Sub-Saharan Africa Cross-Industry Advisory Services
61% 61%
74% 70%
Latin America and the Caribbean Investment Climate
60% 50%
75% 71%
Middle East and North Africa* Public-Private Partnerships
56% 50%
42% 69%
FY18 FY17 FY18 FY17
*Projects in Afghanistan and Pakistan, which previously were * “ Financial Sector” also includes projects undertaken by the
grouped under the Middle East and North Africa region, are integrated World Bank Group team in the Finance & Markets
now grouped under South Asia. The FY17 number has been Global Practice.
recalculated to incorporate the change.

Corporate IFC is committed to going beyond the inherent
diversity we have as an international institution. In
Responsibility 2018, IFC made progress across all diversity index

indicators — n
otably on including more women and
nationals from sub-Saharan Africa and the Caribbean
in senior-professional and manager-level positions.
IFC’s corporate responsibility commitment We did so by implementing targeted recruitment
is to make sustainability an integral part initiatives.
of our internal business operations — IFC joined leading companies to obtain EDGE
holding ourselves accountable to the (Economic Dividends for Gender Equality)
certification — an assessment of the organization’s
same environmental and social standards alignment with global best practices on gender
we ask of our clients. Our commitment equality. In FY18, IFC — as a member of the World
Bank Group — became the first international financial
to walk our talk connects IFC’s mission institution to receive global EDGE certification.
with how we run our business. IFC has in place a suite of initiatives to maintain
gender balance across the talent pipeline, proactively
manage gender pay equity, implement gender-
OUR STAFF
equality policies and practices, and foster an
inclusive workplace culture.
IFC’s employees are our most important asset,
bringing innovative solutions and global best
Promoting ethical culture: IFC promotes a positive
practices to our clients. Their knowledge, skills,
and respectful workplace. The World Bank Group is
diversity, and motivation are a key part of our
revising its Code of Conduct around five core values
comparative advantage.
refreshed this fiscal year — impact, integrity, respect,
teamwork, and innovation. Initiatives to reinforce
INDICATOR FY16 FY17 FY18 these values are being rolled out in our performance
Total full-time staff 3,757 3,860 3,921 management, recruitment, internal communications,
Non-U.S.-based staff (%) 56.5% 55.9% 54.9% and staff-training programs.
Short-term consultants/
Enriching staff development: IFC has a Leadership
temporaries (FTEs) 904 1,018 1,092
and Management Framework that provides
Employee engagement development programs for leaders across the
index 72% 75% 75% organization. IFC has two flagship programs for
Diversity high-potential staff: the Global Business Leadership
Women managers (%) 34.8% 35.5% 39.5% Program (GBLP) and the Corporate Leadership
Program (CLP). These best-in-class leadership
Part II managers (%) 40.6% 38.9% 40.5%
development programs inspire personal mastery
Women GF+ Technical and leadership at all levels in the organization. In
(%) 45.7% 46.2% 46.7% FY18, 60 staff participants completed the GBLP and
Sub-Saharan/ CLP programs — joining an alumni network of more
Caribbean GF+ (%) 10.5% 10.9% 11.2% than 850 staff who coach and mentor employees
Average days of training and advance corporate priorities through stretch
per staff in headquarters 3.35 3.21 2.8 assignments.
Average days of training
per staff in country
IFC had its first cohort of 19 staff complete an
offices 4.08 3.71 2.95 executive Sponsorship Program this fiscal year — t he
newest initiative in a suite of programs developing a
Note: FTE = full-time equivalent (staff); GF+ refers to salary grade pipeline of diverse talent. Staff are nominated through
GF or higher — i.e., professional staff.
IFC’s talent-review process. Participants gain sponsor-
advisee relationships with Vice Presidents, along with
Advancing diversity and inclusion: At IFC, our work enriched career networks.
reaches clients across the globe — p eople, places,
languages, and ideals. That diversity is reflected in Ensuring competitive compensation and benefits:
our staff, representing people of 151 nationalities IFC applies the World Bank Group’s compensation
who work out of 95 countries. Their unique insights framework, with salaries based on the U.S. market
and perspectives are the cornerstone of our for staff recruited in Washington, D.C., and based on
development work. local competitiveness determined by independent
local market surveys for all other staff. IFC also has
variable-pay programs consisting of recognition
programs and performance awards. IFC provides
a competitive package of benefits, including a
retirement plan, medical, life, accidental death,
workers’ compensation, and disability insurance.

Staff salary structure (Washington, D.C.)
As of June 30, 2018, the salary structure (net of tax) and annual average net salaries/benefits for World Bank
Group staff were as follows:
STAFF AT AVERAGE
GRADE SALARY/ AVERAGE
REPRESENTATIVE MINIMUM MIDPOINT MAXIMUM LEVEL GRADE BENEFITS a
GRADES JOB TITLES (US$) (US$) (US$) (%) (US$) (US$)
GA Office Assistant 27,200 38,900 50,600 0.02% 38,995 21,129
GB Team Assistant,
Information Technician 33,200 47,500 61,800 0.23% 46,393 25,137
GC Program Assistant,
Information Assistant 40,700 58,100 75,500 6.69% 59,947 32,481
GD Senior Program Assistant,

Information Specialist,
Budget Assistant 47,900 68,500 89,100 6.21% 74,009 40,101
GE Analyst 65,200 93,100 121,000 10.44% 85,303 46,220
GF Professional 85,300 121,800 158,300 21.06% 111,642 60,491
GG Senior Professional 112,800 161,200 209,600 33.68% 155,672 84,349
GH Manager,
Lead Professional 153,000 218,600 284,200 18.72% 218,903 118,609
GI Director, Senior Advisor 233,100 291,400 349,700 2.50% 289,412 156,813
GJ Vice President 278,900 328,100 377,300 0.37% 359,193 194,623
GK Managing Director,
Executive Vice President,
Chief Executive Officer 310,000 364,700 419,400 0.08% 408,904 263,497
Note: Because World Bank Group staff, other than U.S. citizens, usually are not required to pay income taxes on their Bank Group
compensation, the salaries are set on a net-of-tax basis. These salaries are generally equivalent to the after-tax take-home pay of the
employees of the comparator organizations and firms from which Bank Group salaries are derived. Only a relatively small minority of
staff will reach the upper third of the salary range.
a. Includes medical, life and disability insurance; accrued termination benefits; and other non-salary benefits. Excludes tax allowances.
OUR OFFICES In FY18, IFC made significant advancements toward

our zero-waste goal for our headquarters building.
Minimizing IFC’s impact on the environment is a We upgraded the building-wide recycling system
priority for us. That’s why we design and manage our and launched a reusable food-container program,
buildings in a sustainable way, and offset emissions eliminating nearly 250,000 disposable containers
that cannot be eliminated. annually. The program helped reduce our total waste
by an estimated 26 percent from 2015, according to
Using natural resources efficiently: IFC’s largest our latest waste audit. In addition, IFC is sorting more
office, our headquarters in Washington, D.C., recyclables and diverting them from landfill waste, the
accounts for nearly half of our global real estate audit found.
by square foot. Efficiency efforts have reduced
total electricity consumption at our headquarters Designing sustainably: Nearly 60 percent of IFC’s
by 18 percent since 2007. We also continue to real estate footprint by square foot is LEED-certified
upgrade our lighting systems to LEDs from compact or equivalent. IFC is leading the development and
fluorescent lighting while adjusting temperature engineering of a new net-zero energy-use World Bank
setpoints for water use and heating and cooling Group office building in Dakar, Senegal. The project is
systems. In FY17, these energy-saving projects saved slated for completion in 2020. IFC is also studying the
nearly 60,000 kilowatt hours of electricity. potential for adding on-site solar-energy generation
at our other owned properties.

Maintaining climate neutrality: IFC continues to be $2.56 billion was held by 184 member countries.
carbon-neutral for global business operations. In FY17, These countries guide IFC’s programs and activities.
the latest year for which data are available, carbon
emissions from our global business operations totaled IFC works with the private sector to create opportunity
43,672 metric tons of carbon-dioxide equivalent — of where it’s needed most. Since our founding in 1956,
which business travel accounted for 71 percent. Office we have committed more than $234 billion of our own
electricity consumption accounted for an additional funds for private sector investments in developing
23 percent — half of which was attributable to IFC countries, and we have mobilized more than $51 billion
headquarters. Over the past three years, IFC’s carbon from others.
emissions per full-time employee have declined
by 2 percent to the equivalent of 8.95 metric tons In working to end extreme poverty and boost shared
of carbon dioxide. These numbers reflect emission prosperity, we collaborate closely with other members
factors that were updated in FY18; data for prior years of the Bank Group.
were updated accordingly.
We purchased carbon credits from four projects. Our member countries —

IFC chose projects that bring tangible development strong shareholder support
benefits to the communities in which they take place.
For example, one project provides solar cookers OUR MEMBER PERCENTAGE OF
to residents of the Iridimi refugee camp in Chad, COUNTRIES CAPITAL STOCK
helping avoid the use of firewood. IFC also purchases United States 22.19
renewable-energy certificates (RECs) equal to the
consumption of our headquarters office. IFC annually Japan 6.33
reports its greenhouse emissions in the United Germany 5.02
Nations’ Climate Neutral Now initiative, and through France 4.72
the Carbon Disclosure Project. More details can be
United Kingdom 4.72
found at http://www.ifc.org/footprint.
India 4.01
Russian Federation 4.01
FY17 carbon emissions Canada 3.17
inventory for IFC’s global Italy 3.17
operations China 2.41
174 OTHER COUNTRIES 40.25
METRIC TONS OF CARBON-DIOXIDE EQUIVALENT
Business Travel 30,933 OUR BOARD
Country Office Electricity 5,099
HQ Office Electricity 4,781 Each of our member countries appoints one governor
and one alternate. Corporate powers are vested in
Other 2,859
the Board of Governors, which delegates most powers
TOTAL EMISSIONS 43,672 to a board of 25 directors. Voting power on issues
Note: Emission factors were updated in FY18 under the World Bank brought before them is weighted according to the
Group’s Inventory Management Plan. share capital each director represents.
The directors meet regularly at World Bank Group

headquarters in Washington, D.C., where they review
and decide on investments and provide overall
Our Governance strategic guidance to IFC management. The President
of the World Bank Group is also President of IFC.
OUR PLACE IN THE WORLD BANK GROUP EXECUTIVE COMPENSATION
The World Bank Group is a vital source of financial The salary of the President of the World Bank Group
and technical assistance to developing countries. is determined by the Board of Directors. The salary
Its mission is to fight poverty with passion and structure for IFC’s CEO is determined by positioning a
professionalism, for lasting results. midpoint between the salary structure of staff at the
highest level, as determined annually by independent
IFC is one of five members of the Bank Group, though U.S. compensation market surveys, and the salary of
it is a separate legal entity with separate Articles the World Bank Group President. The compensation
of Agreement, share capital, financial structure, of our executive leadership is transparent.
management, and staff. Membership in IFC is open
only to member countries of the World Bank. IFC’s CEO, Philippe Le Houérou, receives an annual
As of June 30, 2018, IFC’s paid-in capital of about salary of $419,400, net of taxes.

Accountability
INDEPENDENT EVALUATION GROUP
The Independent Evaluation Group is an

independent unit that reports directly to IFC’s
Board of Directors. IEG’s mission is to strengthen
World Bank Group institutions through evaluations
that inform strategies and future work — a nd lead
ultimately to greater development effectiveness.
IEG assesses the results of IFC operations and

offers recommendations for improvement. IEG also
contributes to internal learning by informing new
directions, policies and procedures, and country and
sector strategies. This year, IFC and IEG formed a
joint working group to boost improvement of the
development effectiveness of advisory projects.
IEG’s most recent annual review of World Bank

Group results and performance focuses on
assessing the development-outcome indicator for
environmental and social effects. This and other
major reports are available on IEG’s website at
http://ieg.worldbankgroup.org.
OFFICE OF THE COMPLIANCE ADVISOR

OMBUDSMAN
Affected communities have unrestricted access to

the Compliance Advisor Ombudsman (CAO), the
independent accountability mechanism for IFC.
CAO is mandated to address complaints from people
affected by IFC-supported business activities in a
manner that is fair, objective, and constructive —
with the goal of improving environmental and social
project outcomes and fostering greater public
accountability of IFC.
Independent of IFC and MIGA management and

reporting directly to the President of the World
Bank Group, CAO works to resolve complaints using
a flexible, problem-solving approach through its
dispute-resolution arm and oversees investigations of
IFC’s environmental and social performance through
its compliance arm. CAO’s advisory arm provides
independent advice on broader environmental
and social concerns with the goal of systemic
improvements in IFC performance.
During FY18, CAO addressed 55 cases related to IFC

projects in 32 countries. More information about how
IFC is engaging with CAO’s work is available at
www.cao-ombudsman.org.

Global Partnerships In FY18, our partnerships focused on several
development priorities:
SCALING UP OUR ACTIVITIES IN AFRICA

IFC and our development partners work
together in innovative ways to maximize Our partners’ financial commitments to advisory
programs in the African continent increased
finance for development. In line with 35 percent over the previous year, allowing us to
IFC’s new strategy for creating markets address key development challenges.
and mobilizing private sector investment Denmark, Ireland, Japan, the Netherlands, Norway,
to solve development problems, our Sweden, and the United Kingdom supported our
work to promote economic growth and stability in
partnerships serve a range of functions. sub-Saharan African countries. They did so not only
They incubate new ideas. They allow through longstanding platforms such as the Conflict-
Affected States in Africa (CASA) initiative but also
proven solutions to be scaled up. They through new country-specific advisory interventions
facilitate knowledge transfer. They build such as our private sector development programs in
business and institutional capacity. Somalia, Ethiopia, Mozambique, and Kenya.
Together we support initiatives that The IFC Support Program for the Compact with
strengthen our impact — particularly Africa Initiative (ISCA), created in FY18, received
support from Germany and Norway to help the
in cross-cutting areas such as climate G-20 Compact with Africa Initiative to promote
change and gender equality — and private sector development in 10 African countries.
It will work in close collaboration with the multi-
channel resources to regions of the donor Public-Private Infrastructure Advisory Facility
world where private investment is (PPIAF) and other existing platforms to ensure that
funding and operational activities are complementary.
needed most.
EXPANDING INNOVATIVE SOLUTIONS FOR
WORKING WITH DEVELOPMENT PARTNERS CLIMATE CHANGE
IFC collaborates with more than 30 governments, Our partners’ advisory and blended-finance
20 foundations and corporations, and a variety commitments in support of solutions to address
of multilateral and institutional partners. In FY18, climate change globally grew more than tenfold from
we gained a new development partner, the United the previous year to $536 million — a record increase.
Kingdom’s Foreign and Commonwealth Office. Such initiatives included:
Our partnerships support IFC’s advisory and
investment services — including through blended ••The new Canada-IFC Blended Climate Finance
finance, which has grown significantly as an Program, which aims to support developing countries
instrument to support strategic priority areas (see in their transition to low-carbon, sustainable, and
page 75). In FY18, our development partners more climate-resilient economies.
committed more than $268 million to support IFC ••The Finland-IFC Climate Change Program, which
advisory services and $469 million for blended- focuses on climate mitigation, investments in
finance initiatives. renewable energy, energy efficiency, green buildings,
climate-smart agriculture, and forestry. The program
will also seek investments that support developing
countries’ efforts to adapt to climate change.
Finland became the first European bilateral partner
with IFC to establish a returnable-capital blended-
finance program for climate.
••The Ukraine Energy Efficiency Fund, which enables
homeowners’ associations to conduct energy-
efficiency renovations in multi-family residential
buildings. IFC has partnered with the European
Union and Germany in support of this program.

••The Green Bond Technical Assistance Program, which WORKING WITH INTERNATIONAL
promotes green-bond issuance in emerging markets. INSTITUTIONS
The program supported the new Amundi Emerging
Green One fund (see page 49). Switzerland and IFC engages with key international institutions
Luxembourg provided funding to facilitate adoption across a variety of issues to enhance the role of
of the Green Bond Principles, policy reform, and the private sector in development finance. This
awareness of the potential of green bonds as a includes the United Nations, the Organisation for
financing instrument. Economic Cooperation and Development, the
••The Canada-IFC Renewable Energy Program for Africa, Group of 20 leading economies, the Group of Seven
which aims to improve access to affordable and nations, multilateral development banks (MDBs), and
sustainable energy services and reduce fossil-fuel development finance institutions (DFIs).
dependency in sub-Saharan Africa. Canada is now
IFC’s largest bilateral partner in blended finance. IFC has built strong partnerships while sharing
••The Green Finance program, which focuses on lessons from our six decades of experience in
building awareness of and delivering finance emerging markets. We have shaped the global
products to support renewable energy projects in agenda on private sector solutions for development
Ukraine, thereby reducing or avoiding greenhouse impact, and engaged our clients to align their
emissions by 200,000 metric tons per year. The business models to the new market opportunities
program is supported by Austria. presented by the Sustainable Development
Goals. This engagement is helping confirm the
SUPPORTING GENDER EQUALITY central role of the private sector in achieving
development impact.
The Women Entrepreneurs Finance Initiative (We-Fi)
is a new collaborative partnership hosted by the IFC collaborates with MDBs through the MDB Heads
World Bank Group. It is supported by 14 governments, platform, where our management regularly discusses
eight multilateral development banks, and other issues of strategic importance to the MDB system.
public and private sector stakeholders. IFC received Key achievements include harmonizing the way we
We-Fi funding to address financial and nonfinancial define and measure mobilization of private finance,
constraints faced by women entrepreneurs in climate finance, blended finance, and alignment of
developing countries. This work involves a mix of development outcomes. We also collaborate with
blended finance, research, and advisory services. these institutions to address climate change and
scale up investment in infrastructure.
We also introduced the new MENA Women
Banking Champions Program, which is supported In FY18, we worked with other MDBs to publish a
by Switzerland. The program aims to increase second joint report on the mobilization of private
access to financial services for women — including finance by MDBs and DFIs, using a common
women entrepreneurs — b y working with financial measurement framework and methodology. The
intermediaries in Egypt, Morocco, and Tunisia. report found that MDBs and DFIs mobilized more
than $160 billion from private investors. This included
STRENGTHENING THE INFRASTRUCTURE mobilization by the European Development Finance
SECTOR Institutions (EDFIs). EDFIs and the MDB Heads also
adopted the Enhanced Principles for DFI Blended
The new Korea-IFC Partnership Program represents Concessional Finance for Private Sector Projects and
the largest commitment to date by the Republic of agreed to their implementation.
Korea to IFC advisory services. The program addresses
constraints in key areas of infrastructure, including
information and communication technologies globally.
The partnership will support IFC advisory efforts
involving power, transportation, water, waste, utilities,
subnational finance, extractives, digital services, and
public-private partnerships.

Development partner commitments
FINANCIAL COMMITMENTS TO IFC ADVISORY SERVICES (US$ MILLION EQUIVALENT)
Summary FY17 FY18
Governments 256.76 192.01

Institutional/Multilateral Partners 8.32 76.34
Corporations, Foundations, and NGOs 3.07 0.00
Total 268.15 268.35
Governments FY17 FY18
Australia 62.92 3.05

Austria 6.47 8.19
Canada 0.00 3.78
Denmark 9.17 5.02
France 2.12 0.00
Germany 2.62 23.24
Ireland 0.96 1.08
Israel 0.00 0.80
Italy 5.09 0.00
Japan 21.17 6.25
Korea, Republic of 0.00 9.00
Luxembourg 3.98 9.28
The Netherlands 11.00 4.91
New Zealand 4.82 1.24
Norway 0.94 13.72
Sweden 0.00 7.12
Switzerland 68.68 24.89
United Kingdom 38.74 70.43
United States 18.08 0.00
Total 256.76 192.01
Institutional/Multilateral Partners FY17 FY18
Climate Investment Funds 4.70 0.25

European Commission 3.08 50.54
MENA Transition Fund 0.54 0.00
TradeMark East Africa (TMEA) 0.00 0.35
Women Entrepreneurs Finance Initiative (We-Fi) 0.00 25.20
Total 8.32 76.34
Corporations, Foundations, and NGOs FY17 FY18
BHP Billiton Foundation 2.57 0.00

The William and Flora Hewlett Foundation 0.50 0.00
Total 3.07 0.00
FINANCIAL COMMITMENTS TO IFC BLENDED FINANCE INITIATIVES (US$ MILLION EQUIVALENT)
Development Partner FY17 FY18
Canada 0.00 310.54

Finland 0.00 134.31
United Kingdom 36.40 0.00
Women Entrepreneurs Finance Initiative (We-Fi) 0.00 24.20
Total 36.40 469.06

Portfolio Management At the project level, our multidisciplinary teams —
including investment and sector specialists — closely
monitor investment performance and compliance
with investment agreements. We do this, among
Building and proactively managing a other things, through site visits to evaluate project
portfolio that produces strong financial implementation, and through active engagement
with sponsors and government officials, where
results and development impact is at relevant, to identify potential problems early on
the core of IFC’s approach to portfolio and formulate appropriate solutions. We also track
environmental and social performance in a timely
management. We achieve this through and risk-based manner, and measure financial and
a combination of strong presence on development results.
the ground and deep sector expertise. Following the strong growth of our equity portfolio
This enables us to stay close to our in recent years, IFC has implemented a new equity
approach, leading to more moderate growth and
clients and markets, monitor trends, greater selectivity. We are also proactively assessing
and anticipate impacts on our clients. our equity portfolio to identify assets ready for
divestments, where IFC’s development role has been
An IFC Management committee — the Corporate completed. This rebalancing of the equity portfolio
Portfolio Committee — regularly reviews the entire results from an analysis that takes into account
portfolio of nearly $57.2 billion for IFC’s own account, market conditions, opportunities, expected returns,
looking at broad trends as well as select individual and risks — and is adjusted periodically as required.
projects. This review is complemented by monthly This approach is supported by the appointment of
in-depth discussions of IFC’s key sector and country IFC’s Equity Heads of Industry, who provide central
exposures. Quarterly reviews of IFC’s portfolio results oversight and are required to effectively manage IFC’s
are presented to the Board, along with an in-depth larger and more complex equity positions.
analysis at the end of each fiscal year. Our investment
and portfolio teams, largely based in field offices, For projects in financial distress, our Special
complement global reviews with asset-by-asset Operations Department determines the appropriate
quarterly assessments, for both debt and equity remedial actions. It seeks to keep the project
investments. operational to achieve the development impact
intended at its onset. It also negotiates agreements
At the corporate level, IFC combines analysis of with creditors and shareholders to share the burden
our portfolio performance with sector expertise, of restructuring. Investors and other partners
local market intelligence, and projections of global participating in IFC’s operations are kept regularly
macroeconomic and market trends to inform decisions informed on project developments. IFC consults them
about future investments. We also regularly conduct or seeks their consent as appropriate.
stress tests to assess the performance of the portfolio
against possible macroeconomic developments, and Active portfolio management depends on timely
to identify and address risks. and accurate information to drive business decisions.
IFC continues to invest in information-technology
systems to better support the management of our
portfolio. We are also strengthening our portfolio
support structure by creating a corporate Operations
Support Unit, to be extended over time to sector and
regional teams.

Managing Risks TREASURY
IFC raises funds in the international capital markets

ENTERPRISE RISK MANAGEMENT for private sector lending and to ensure sufficient
liquidity to safeguard IFC’s triple-A credit ratings.
IFC provides long-term investments to the private
sector in emerging markets, which includes expanding Issuances include benchmark bonds in core currencies
the investment frontier into the most challenging such as U.S. dollars, thematic issuances to support
markets. In doing so, IFC is exposed to a variety of strategic priorities such as climate change, and
financial and nonfinancial risks. Active monitoring and issuances in emerging-market currencies to support
sound management of evolving risks are crucial to capital-market development. Most of IFC’s lending is
fulfilling our mission. denominated in U.S. dollars, but we borrow in many
currencies to diversify access to funding, reduce
IFC’s enterprise-risk-management framework is borrowing costs, and support local capital markets.
designed to enable the prudent management of
financial and reputational impacts that originate Over the years, IFC’s funding program has grown
from our business activities. In this context, IFC’s risk- to keep pace with our lending — in FY18, new core
management efforts are designed specifically to help and short-term borrowings totaled approximately
align our performance with our strategic direction. $16.7 billion.
IFC has developed risk-appetite statements that set

the direction for our willingness to take on risks in
fulfilment of our development goals. These statements
reflect our core values of maximizing development
impact, preserving our financial sustainability, and
safeguarding our brand.
FY18 total borrowing

AMOUNT
CURRENCY (US$ EQUIVALENT) PERCENT
U.S. dollar USD 9,106,890,500 54.5%
Australian dollar AUD 1,436,546,360 8.6%
Japanese yen JPY 815,159,597 4.9%
Russian ruble RUB 239,001,013 1.4%
Brazilian real BRL 434,491,970 2.6%
Turkish lira TRY 1,180,551,179 7.1%
Indian rupee INR 608,468,320 3.6%
Other 2,893,671,464 17.3%
Total 16,714,780,403 100.0%

LIQUIDITY MANAGEMENT CAPITAL ADEQUACY AND FINANCIAL CAPACITY
Liquid assets on IFC’s balance sheet totaled Sound risk management plays a crucial role in
$38.9 billion as of June 30, 2018, compared with ensuring IFC’s ability to fulfill our development
$39.2 billion a year earlier. Most liquid assets are mandate. The very nature of IFC’s business, as a
held in U.S. dollars. The exposures arising from assets long-term investor in dynamic yet volatile emerging
denominated in currencies other than U.S. dollars are markets, exposes us to financial and operational risks.
hedged into U.S. dollars or matched by liabilities in
the same currency to eliminate overall currency risk. Prudent risk management and a solid capital position
The level of these assets is determined with a view to enable us to preserve our financial strength and
ensuring sufficient resources to meet commitments maintain our lending during times of economic and
even during times of market stress. IFC maintains financial turmoil. IFC’s financial strength results in low
liquid assets in interest-bearing instruments managed borrowing costs, allowing us to provide affordable
actively against stated benchmarks. financing to our clients.
The level of liquid assets is determined to ensure The soundness and quality of IFC’s risk management
that IFC has sufficient resources to meet cash-flow and financial position can be seen in our triple-A
requirements for both a normal planning horizon and credit rating, which has been maintained since
a period of market stress. We use liquidity coverage coverage began in 1989.
ratios to assess IFC’s liquidity needs.
We assess IFC’s minimum capital requirement in
TREASURY RISK MANAGEMENT accordance with our economic capital framework,
which is aligned with the Basel framework and leading
Treasury risks are managed through a two-tier risk industry practice. Economic capital acts as a common
framework: (1) a comprehensive policy framework; currency of risk, allowing us to model and aggregate
and (2) a hard economic-capital limit for treasury the risk of losses from a range of different investment
activities. The policy framework is based on four products as well as other risks.
principles:
Consistent with industry and regulatory practice,
(1) Investment in high-quality assets IFC calculates economic capital for the following
(2) Diversification via position size/concentration limits risk types:
(3) Tight limits on market risks (credit spread, interest
rate, and foreign-exchange risk) ••Credit risk: the potential loss due to a client’s default
(4) Proactive portfolio surveillance or downgrade
••Market risk: the potential loss due to changes in
In line with the changes that are occurring in the market variables (such as interest rates, currency,
global financial markets, we enhanced our Treasury equity, or commodity prices)
policy framework in FY18, including changes to ••Operational risk: the potential loss resulting from
economic-capital methodology. inadequate or failed internal processes, people, and
systems or from external events
IFC’s total resources available consist of paid-in

capital, retained earnings net of designations and
certain unrealized gains, and total loan-loss reserves.
The excess available capital, beyond what is required
to support existing business, allows for future growth
of our portfolio while also providing a buffer against
unexpected external shocks. As of June 2018, total
resources available stood at $24.7 billion, while the
minimum capital requirement totaled $20.1 billion.

Our Sustainability IFC PERFORMANCE STANDARDS
Framework At the core of our Sustainability Framework are the

IFC Performance Standards — which help our clients
avoid, mitigate, and manage risk as a way of doing
business sustainably. They help clients devise solutions
Sustainability is critical to companies’ that are good for business, good for investors, and
business success. It’s critical, too, for their good for the environment and communities.
customers, surrounding communities, Our Performance Standards have become a global

and broader stakeholders. benchmark of sustainability practices. The Equator
Principles, which are modeled on these standards,
have been adopted by 94 financial institutions in
IFC research shows that companies perform better 37 countries. In addition, other financial institutions
financially when their environmental, social, and reference the IFC Performance Standards — including
corporate-governance performance is strong. Nearly export-import banks and export credit agencies.
90 percent of our clients believe that our work is IFC also serves as the Secretariat for the Sustainable
key in helping them reach their long-term business Banking Network, a global knowledge-sharing group
goals, improve their relations with stakeholders and of banking regulators and banking associations,
local communities, and boost their brand value and to help develop guidance and capacity for banks
recognition. IFC’s Sustainability Framework and our to incorporate environmental and social risk
Corporate Governance Methodology are designed to management into credit decision-making.
help our clients achieve those objectives.
The Performance Standards guide our environmental
IFC helps clients understand and manage the and social due-diligence process, which integrates the
risks they face, partnering with industry and other client’s assessment of environmental and social risks
stakeholders to find innovative solutions that open with an understanding of the client’s commitment and
up opportunities for economically, socially, and capacity to mitigate and manage these risks. This
environmentally sustainable private investment — review identifies any gaps between client practice and
which contribute in turn to jobs and inclusive growth. the IFC Performance Standards in order to agree on
This may include leveraging the capacity of other a plan of action to ensure compliance. We supervise
institutions of the World Bank Group to address our projects throughout the life of our investment.
environmental, social, and governance challenges
that are beyond the ability or responsibility of a
company to solve alone.
In all of our investment decisions, IFC gives the same

weight and attention to environmental, social, and
governance risks as we do to credit and financial risks.
This enables us to take informed risks to achieve both
development impact and financial sustainability.
The IFC Performance Standards
1
RISK MANAGEMENT
2LABOR
3
RESOURCE EFFICIENCY
4
COMMUNITY
Anticipate risks, Treat workers fairly and Promote energy Protect local communities
avoid, minimize, and provide safe and healthy efficiency, use resources from worksite accidents
compensate for any working conditions. sustainably, and cut and other project-
impacts. greenhouse emissions. related dangers.

INTEGRATED GOVERNANCE Another tool is the IFC Transparency and Disclosure
Toolkit and Guidance — which helps companies
Corporate governance is a paramount consideration in emerging markets prepare comprehensive and
in investors’ decision making. But investors are best-in-class annual reports that are appropriate
increasingly paying equal attention to the way for their size and organizational complexity and
companies behave on a variety of environmental adapted to the context of operation. The objective is
and social indicators. Investors see businesses’ to provide useful information for investors and other
management of environmental and social issues as stakeholders.
a test of how they would handle all strategic and
operational challenges. We apply this integrated approach beyond the
companies we invest in. We also use it in our advisory
It’s essential, therefore, to assess environmental, work with regulators and stock exchanges — t o help
social, and governance practices in an them apply higher disclosure standards to corporate
integrated fashion. listings, reporting requirements, and other disclosure
obligations.
IFC has developed comprehensive market guidance
and practical tools to do this in the context of
emerging markets, drawing on our track record in
applying our Performance Standards and Corporate
Governance Methodology.
One new tool — the IFC Corporate Governance

Progression Matrix — guides companies, investors,
regulators, corporate-governance evaluators, and
other stakeholders in assessing and improving a
company’s environmental, social, and governance
framework. It emphasizes the importance of
continuing progress — rather than static minimum
standards — in the governance practices of
a company.
The matrix focuses the assessment along

six corporate-governance parameters — k ey
environmental and social policies and practices, the
structure and functioning of the board of directors,
the control environment, disclosure and transparency,
treatment of minority shareholders, and governance
of stakeholder engagement (which includes civil
society and communities affected by a company’s
operations).
5
LAND RESETTLEMENT
6BIODIVERSITY
7
INDIGENOUS PEOPLES
8
CULTURAL HERITAGE
Avoid involuntary Protect biodiversity Protect the rights, dignity, Protect cultural
resettlement and and ecosystems. and culture of indigenous heritage and promote
minimize the impact populations. equitable sharing
on those displaced. of related benefits.

Reporting under the The Climate Implementation Plan was created in
conjunction with investment departments to support
Task Force on Climate- the mainstreaming of climate activities in IFC

operations. It was approved by the IFC Management
related Financial
Team. IFC reports annually to the Board of Directors
on progress made toward climate goals. IFC’s most
recent report to the Board was in June 2018, when
Disclosures IFC reported climate business to be at 34 percent
of its total own-account commitments for FY18,
exceeding the annual climate target for the second
CLIMATE-RELATED FINANCIAL DISCLOSURE year in a row, and exceeding the FY20 target. IFC has
increased its core investments in clean energy while
In December 2015, the Financial Stability Board substantially building its investments in climate-smart
launched the Task Force on Climate-related Financial agriculture, green buildings, and green finance.
Disclosures (TCFD), which in July 2017 released
recommendations for companies to voluntarily Governance: IFC created the Climate Business
disclose how they evaluate and mitigate climate- Department (CBD) in 2010 to support a corporate
related financial risks. This is IFC’s first disclosure focus on climate. It complements the work of the
under the TCFD framework, although IFC has been IFC department that oversees environmental, social,
annually disclosing its climate-related investments and governance performance standards for each
and net emission reductions for several years. IFC investment — including environmental risks
more broadly.1 CBD’s role is to help increase climate
STRATEGY AND GOVERNANCE business and build market opportunities to invest in
tomorrow. CBD staff includes dedicated experts on
Strategy: IFC was an early investor in climate climate-business sectors, metrics, strategy, policy,
businesses and began tracking its climate-related and climate-finance innovation.
investments in 2005. By the end of FY18, over a third
of IFC’s total commitments were climate-related. In To integrate climate business throughout the
2016, IFC developed a Climate Implementation Plan. Corporation, IFC established a Climate Anchors
This plan — part of the World Bank Group’s Climate Network. Anchors in each industry sector and region
Change Action Plan — lays out four elements that are responsible for building climate business in their
drive IFC’s climate activities: (1) increase climate respective areas. Each anchor reports to her/his
investments to 28 percent of IFC’s own account department director and the Director of the Climate
commitments by 2020; (2) mobilize $13 billion per year Business Department.
in private capital by 2020; (3) account for climate risks;
and (4) maximize impact. RISK MANAGEMENT
The plan identifies how to increase climate IFC recognizes that climate change potentially
investments in five priority sectors — c
lean energy, poses a risk to its financial returns, particularly for
green buildings, climate-smart cities, climate-smart its longer-hold investments. In 2011 and 2015, IFC
agribusiness, and green finance. In each area, IFC supported two Mercer studies to identify financial
identifies the market potential today, where the risk implications — focusing on risks to institutional
market is moving, and how IFC can accelerate investors and providing related insights to financial
investments in each sector. IFC also specifies the institutions.2 The reports found significant risks to
tools and resources needed to achieve the plan’s investing in a business-as-usual scenario. Since then,
goals, including prime areas for technical assistance, IFC has increased its proportion of climate-related
geographic priorities for each sector, and where investments, and is developing tools for systematically
blended finance can help open new markets. evaluating climate risk in key new investments.
Physical risks: This describes how the physical

impact of climate change on an investment will
affect its financial returns. IFC initiated a pilot to
incorporate physical climate-risk analysis into IFC’s
investment due diligence, going beyond the existing
environmental and social risk assessment. IFC is
introducing tools to assess this risk in its investments
1. Download at: https://www.ifc.org/wps/wcm/connect/topics_ext_content/ifc_external_corporate_site/sustainability-at-ifc/

policies-standards/performance-standards/performance-standards
2. Download at: https://www.ifc.org/wps/wcm/connect/6b85a6804885569fba64fa6a6515bb18/
ClimateChangeSurvey_Report.pdf?MOD=AJPERES
https://www.mercer.com/content/dam/mercer/attachments/global/investments/mercer-climate-change-report-2015.pdf

in key sectors, including ports, waterways, roads, Climate metrics: IFC’s Definitions and Metrics for
airports, forestry, pulp and paper, and insurance. Climate-Related Activities identifies projects and
IFC will evaluate the outcomes of the pilot in FY19, sectors that qualify as climate investments; these
adjusting and extending the approach as necessary. definitions are harmonized with other multilateral
development banks, and are publicly available.4
Transition risks: To address government policies and
stranded-asset risk and systematically incorporate Investment disclosure: IFC reports on its climate
climate-related considerations in its investment finance commitments in the Annual Report (see
decisions, in November 2016, the IFC Management page 75) and in the Joint Report on Multilateral
Team approved a pilot to use an internal carbon price Development Banks’ Climate Finance.5 In its annual
for project-finance investments in selected sectors. Green Bond Impact Report, IFC also reports on
This involved stress-testing prior investments in these the environmental and market impact of projects
sectors and using a carbon price in calculating the financed through green bonds that IFC issues.6
economic rate of return for new investments.
Emissions disclosure: IFC reports aggregated net
In March 2018, the Management Team approved reductions in greenhouse emissions from its climate
full implementation of carbon pricing for project- investments in this Annual Report (see page 49). In
finance transactions in select high-emitting sectors. FY18, net aggregate reductions were 10.4 million
Beginning in May 2018, IFC has applied a carbon metric tons, up from 6.7 million metric tons the year
price — in line with the 2016 Report of the High-Level before. Under IFC Performance Standard 3, emissions
Commission on Carbon Prices3 — to the economic of projects with estimated annual emissions over
analysis of project-finance transactions with annual 25,000 metric tons of carbon dioxide equivalent
emissions of more than 25,000 metric tons of carbon are disclosed through the Environmental and Social
dioxide equivalent in thermal power generation, Review Summary (ESRS) for each project.
cement, and chemicals. For these projects, IFC
provides a carbon-price sensitivity analysis and
reports outcomes to the Board. Other sectors and
other types of transactions are currently being
analyzed for potential future inclusion.
TARGETS AND METRICS
Targets: IFC has two publicly stated quantifiable

targets for climate business, as set forth above
under the Climate Implementation Plan. IFC creates
internal incentives to reach these targets by including
climate performance in corporate and individual units’
scorecards.
In April 2018, as part of the capital-increase package

approved for IFC, IFC’s Board set a new target of
35 percent climate business for IFC’s own-account
investments by 2030. As IFC’s total investment
increases, this new target is expected to almost triple
IFC’s dollar volume in climate-related commitments
compared with FY17. IFC will also implement a plan
to systematically screen transactions for climate risk,
building on its current pilot described above.
3. Download at: https://www.carbonpricingleadership.org/report-of-the-highlevel-commission-on-carbon-prices

4. Available at: https://www.ifc.org/wps/wcm/connect/8ea3b242-c6bb-4132-82b1-ee4bd7007567/
IFC+Climate+Definitions+v3.1+.pdf?MOD=AJPERES
5. Access report at: http://pubdocs.worldbank.org/en/266191504817671617/2016-joint-report-on-mdbs-climate-finance.pdf
6. https://www.ifc.org/wps/wcm/connect/37ad9090-df3f-489e-b3d7-66d3ca2ff69c/
201710-IFC-Green-Bond-Impact-Report-FY17-v2.pdf?MOD=AJPERES

Independent Assurance
Report on a Selection
of Sustainable Development
Information
In response to a request made by IFC, we performed
a review on a selection of sustainable development
information in the Annual Report for the financial year
ended June 30, 2018, including quantitative indicators
(“the Indicators”) and qualitative statements (“the
Statements”). We selected indicators and statements
that were deemed to be of particular stakeholder interest,
to involve a potential reputation risk for IFC, and/or to
value IFC’s corporate responsibility management and
performance.
The Statements in the following sections have been reviewed: “Redefining

Development Finance” (pp. 24–61), “Measuring Up” (pp. 73–75),
“Understanding Our Development Impact” (pp. 85–91), “Corporate
Responsibility” (pp. 92–94), “Our Sustainability Framework” (pp. 102–103),
and “Reporting under the Task Force on Climate-related Financial
Disclosure” (pp. 104–105).

The following indicators have been reviewed:
MATERIAL AREAS INDICATORS

FY18 DOTS scores Investments DOTS scores (percentages, weighted and unweighted) by
(pp. 90–91) performance area, industry and region, Advisory services DOTS scores
(percentage) by performance area, industry and region
CY17 Reach indicators Employment (millions of jobs), Patients served (millions), Students reached
(p. 89) (millions), Farmers reached (millions), Gas distribution (millions of people
reached), Water distribution (millions of people reached), Power distribution
(millions of people reached), Power generation (millions of people reached),
Phone connections (millions of people reached), Number of transactions
(millions) and amount ($ billions) in Trade Finance, Number (millions) and
amounts ($ billions) of microfinance loans and SME loans, Financing facilitated
through advisory services ($ billions)
FY18 long-term commitments by Long-term commitments ($ millions) and projects (number) by Environmental
Environmental and Social category and Social category
(p. 66)
FY18 climate-related achievements Commitments in Climate-related investments ($ billions)
(p. 75)
FY17 emissions from IFC’s global Carbon emissions (tCO2e) for IFC’s own operations
business operations
(p. 94)
Our review aimed to provide limited assurance1 that: NATURE AND SCOPE OF OUR REVIEW
1. The Indicators were prepared in accordance with We performed the following review to be able to
the reporting criteria applicable during fiscal year express a conclusion:
2018 (the “Reporting Criteria”), consisting of IFC
instructions, procedures and guidelines specific to •• We assessed the Reporting Criteria, policies and
each indicator, a summary of which is provided principles, with respect to their relevance, their
in the Annual Report, for the indicators related completeness, their neutrality and their reliability.
to Commitments by Environmental and Social •• We reviewed the content of the Annual Report to
Category (p. 66) and development effectiveness identify key statements regarding the sustainability
of investments and advisory services, and on IFC’s and development areas listed above.
website for the others; •• At the corporate level, we conducted interviews with
2. The Statements have been presented in accordance more than 20 people responsible for reporting to
with “IFC’s Access to Information Policy,” which is assess the application of the Reporting Criteria or to
available on IFC’s website2 and the principles of substantiate the Statements.
relevance, completeness, neutrality, clarity and •• At the corporate level, we implemented analytical
reliability as defined by international standards.3 procedures and verified, on a test basis, the
calculations and the consolidation of the Indicators.
It is the responsibility of IFC to prepare the Indicators •• We collected supporting documents for the
and Statements, to provide information on the Indicators or Statements, such as reports to
Reporting Criteria and to compile the Annual Report. the board of directors or other meetings, loan
agreements, internal and external presentations and
It is our responsibility to express a conclusion on reports, or survey results.
the Indicators and the Statements based on our •• We reviewed the presentation of the Statements
review. Our review was conducted in accordance and the Indicators in the Annual Report and the
with ISAE 3000, International Standard on Assurance associated notes on methodology.
Engagements from IFAC.4 Our independence is
defined by IFAC professional code of ethics.
1. A higher level of assurance would have required more extensive work.

2. https://disclosures.ifc.org
3. ISAE 3000 from IFAC, Global Reporting Initiative (GRI), or AA1000 Accountability Standard.
4. ISAE 3000: “Assurance Engagement other than reviews of historical data,” International Federation of Accountants, International Audit
and Assurance Board, December 2003.

LIMITATIONS OF OUR REVIEW Lastly, in order to assess the final number of
beneficiaries for gas distribution, power distribution
Our review was limited to the Statements and the and water distribution indicators, IFC uses country
Indicators identified in the table above and did not averages of number of people per household —
cover other disclosures in the Annual Report. which are four for non-IDA countries and five for
IDA countries. These averages have been defined in
Our tests were limited to document reviews and the past and in accordance with other Multilateral
interviews at IFC’s headquarters in Washington, D.C. Development Banks but they may differ from the
Within the scope of work covered by this statement, demographic evolution of certain countries.
we did not participate in any activities with external
stakeholders or clients and only conduct limited Development Outcome Tracking System (DOTS) scores
testing aimed at verifying the validity of information
on a sample of individual projects. DOTS, the current ex-post rating system that assesses
IFC projects’ development impact, is currently
INFORMATION ABOUT THE REPORTING reviewed and will be progressively replaced by an
CRITERIA AND THE STATEMENT end-to-end approach (from ex-ante to ex-post)
PREPARATION PROCESS named the Anticipated Impact Measurement and
Monitoring (AIMM) system.
With regards to the Reporting Criteria and the
Statement preparation policies and principles, we For investment services, DOTS scores reflect the
wish to make the following comments: degree to which investment projects deliver outcomes
during portfolio supervision. These outcomes are
Development Reach indicators grouped into four performance areas:
Reach indicators sum up the development ••They are a mix of development outcomes (Economic
achievement of IFC’s clients. Thus, Reach figures do Performance and Private Sector Development
not show the additional development benefit brought Impact), financial return (Financial Performance)
by IFC’s investments. and management of environmental and social risks
(Environmental & Social Performance). Developing
Furthermore, these indicators are based on AIMM, the new framework will focus solely on
information provided by individual clients and are development outcomes, other aspects being
therefore subject to the following precautions: addressed separately.
••They are assessed relative to the development
•• Even if IFC engages its clients during the impact claims asserted ex-ante. IFC is developing
reporting campaign, in some cases, data from the rules governing how ex-ante AIMM scores evolve
client cannot be obtained. Thus, the perimeter of during portfolio supervision and these rules will
the Reach indicators might vary from one year to allow IFC to eventually replace DOTS ratings with
another, depending on clients’ responsiveness. For portfolio AIMM scores.
microfinance loans, SME loans and trade finance
indicators, IFC applies conservative extrapolations, Climate-related investments
which leads to a certain margin of error, acceptable
to us. Other Reach indicators are not extrapolated As part of the World Bank Group Climate Change
and may therefore be underestimated. Action Plan, IFC is strongly committed to reaching
•• At the time of their receipt, the consistency of the the four climate-related targets set in its 2016
collected data may vary from IFC definitions and Climate Implementation Plan. With the progress of
calculation guidelines. IFC performs consequently knowledge and in coordination with other Multilateral
a series of advanced controls and follow-ups, Development Banks, IFC has refined periodically
especially for the biggest contributors. These the definitions and typology used for identifying,
controls are even more important for microfinance promoting, and tracking climate-related investment
loans, SME loans and trade finance indicators, and advisory projects. While the typology has been
where such misinterpretations have been identified stable for the past two years, these fine-tunings can
by IFC. make it harder to compare the figures year over
year, although IFC indicates when methodology has
changed and specifies its impact on the figures.

IFC has developed ex-ante GHG calculation tools that
allow IFC and its clients to assess, when feasible, the
potential greenhouse gas emissions savings of the
projects invested. These tools are regularly upgraded
and customized to specific sectors and activities.
Currently, the actual reductions are not systematically
tracked ex-post and IFC does not monitor the gross
emissions and the net emissions (compared to a
baseline) of its annual commitments, although it
intends to begin doing that next year.
Given the difficulties associated with data

availability in its areas of operation and the
current methodological debates, IFC is not yet
able to assess the compatibility of its annual
commitments with a global warming of no more
than 2°C above pre-industrial temperatures, as
per the recommendations of the Task Force on
Climate-related Financial Disclosures. However,
IFC is gradually applying a shadow carbon
price to the economic analysis associated with
investment decisions.
CONCLUSION
Based on our review, nothing has come to our

attention that causes us not to believe that:
••The Indicators were established, in all material

aspects, in accordance with the Reporting Criteria;
••The Statements were presented, in all material
aspects, in accordance with “IFC’s Policy on
Disclosure of Information” and the principles of
relevance, completeness, neutrality, clarity and
reliability as defined by international standards.
Paris-La Défense, August 8, 2018
The Independent Auditor

ERNST & YOUNG et Associés
Caroline Delérable
Partner, Sustainable Performance & Transformation

Financial Performance Summary
The overall market environment has a significant influence on IFC’s financial
performance. The main elements of IFC’s net income (loss) and comprehensive
income (loss) and influences on the level and variability of net income (loss) and
comprehensive income (loss) from year to year are:
ELEMENTS SIGNIFICANT INFLUENCES
Net income:
Yield on interest earning assets Market conditions including spread levels and degree of competition.
Nonaccruals and recoveries of interest on loans formerly in nonaccrual status
and income from participation notes on individual loans are also included in
income from loans.
Liquid asset income Realized and unrealized gains and losses on the liquid asset portfolios, which
are driven by external factors such as: the interest rate environment and
liquidity of certain asset classes within the liquid asset portfolio.
Income from the equity investment Global climate for emerging markets equities, fluctuations in currency and
portfolio commodity markets and company-specific performance for equity investments.
Performance of the equity portfolio (principally realized capital gains, dividends,
equity impairments, gains on non-monetary exchanges and unrealized gains
and losses on equity investments).
Provisions for losses on loans Risk assessment of borrowers and probability of default and loss given default.
and guarantees
Other income and expenses Level of advisory services provided by IFC to its clients, the level of expense
from the staff retirement and other benefits plans, and the approved and
actual administrative expenses and other budgets.
Gains and losses on other non- Principally, differences between changes in fair values of borrowings, including
trading financial instruments IFC’s credit spread, and associated derivative instruments and unrealized gains
accounted for at fair value or losses associated with the investment portfolio including puts, warrants and
stock options which in part are dependent on the global climate for emerging
markets. These securities are valued using internally developed models or
methodologies utilizing inputs that may be observable or non-observable.
Grants to IDA Level of the Board of Governors-approved grants to IDA.
Other comprehensive income (loss):
Unrealized gains and losses on Global climate for emerging markets equities, fluctuations in currency
listed equity investments and and commodity markets and company-specific performance. Such equity
debt securities accounted for as investments are valued using unadjusted quoted market prices and debt
available-for-sale securities are valued using internally developed models or methodologies
utilizing inputs that may be observable or non-observable.
Unrecognized net actuarial gains Returns on pension plan assets and the key assumptions that underlay
and losses and unrecognized prior projected benefit obligations, including financial market interest rates, staff
service costs on benefit plans expenses, past experience, and management’s best estimate of future benefit
cost changes and economic conditions.

Global equity markets in emerging economies have balances. FY17 income from loans was positively
been volatile in recent years but there was an overall impacted by a onetime recognition of interest
improved operating environment in FY18, despite a income as a result of a full prepayment of a loan.
decline in the fourth quarter of FY18 (FY18 Q4). IFC’s However, IFC also recorded higher borrowing charges,
major investment currencies remained relatively consistent with the increase in interest rates, and lower
stable against IFC’s reporting currency, the US$, income from liquid asset trading activities. Specific
through much of FY18 until significant depreciation in provisions for losses on loans declined substantially in
a number of such currencies during FY18 Q4. Overall FY18, led by project-specific developments, but was
commodity prices rose during FY18, although there offset by an increase in general provisions on loans as
were mixed results across the various sectors. FY17 included a one-time release of $156m from the
implementation of a new risk rating system.
The market volatility, together with project-specific
developments, impacts the valuations of IFC’s IFC has reported income before net unrealized gains
investments and overall financial results. IFC and losses on non-trading financial instruments
recorded higher income from equity investments accounted for at fair value, grants to IDA and net
and associated derivatives in FY18, compared to gains and losses attributable to non-controlling
FY17, driven largely by lower impairments. IFC also interest of $1,272 million in FY18, as compared to
recorded higher income from loans and guarantees $1,129 million in FY17. The $143 million increase in FY18
due to the increase in interest rates and an increase in when compared to FY17 was principally a result of
income from debt securities driven by higher average the following:
Change in income before net unrealized gains and losses

on non-trading financial instruments accounted for at fair
value, grants to IDA and net gains and losses attributable
to non-controlling interests FY18 vs FY17 (US$ millions)
INCREASE
(DECREASE)
FY18 VS FY17
Higher foreign currency transaction gains on non-trading activities $ 311
Lower other-than-temporary impairments on equity investments and debt securities 150
Higher income from loans and guarantees, realized gains and losses on loans and
associated derivatives 79
Higher debt securities income 66
Higher unrealized gains on equity investments and associated derivatives, net 50
Higher other income 50
Lower pension expenses 49
Higher administrative expenses (67)
Lower realized gains on equity investments and associated derivatives, net (81)
Lower income from liquid asset trading activities (146)
Higher charges on borrowings (329)
Other, net 11
Change in income before net unrealized gains and losses on non-trading financial
instruments accounted for at fair value, grants to IDA and net gains and losses
attributable to non-controlling interests $ 143

IFC’s net income (loss) for each of the past five fiscal years ended June 30, 2018 is presented below
(US$ millions):
IFC’s net income (loss), fiscal years 2014–2018

Fiscal year ended June 30 (US$ millions)
2014 1,483
2015 445
2016 (33)
2017 1,418
2018 1,280
Income Available for Designations (a non-GAAP measure)1 was $1,318 million, compared with $1,233 million in
FY17 and $770 million in FY16.
1. Income available for designations generally comprises net income excluding unrealized gains and losses on investments and unrealized
gains and losses on other non-trading financial instruments, income from consolidated VIEs, and expenses reported in net income
related to prior-year designations.
Reconciliation of reported net income to income available for

designations (US$ millions)
FY18 FY17 FY16
Net income (loss) attributable to IFC $ 1,280 $ 1,418 $ (33)
Add: Net gains (losses) attributable to non-controlling interests – 4 (1)
Net income (loss) $ 1,280 $ 1,422 $ (34)
Adjustments to reconcile Net Income to Income Available for Designations
Unrealized losses and (gains) on borrowings 93 (74) (62)
Grants to IDA 80 101 330
Advisory Services Expenses from prior year designations 60 64 57
Unrealized (gains) and losses on investments (198) (287) 470
Other 3 7 9
Income Available for Designations $ 1,318 $ 1,233 $ 770
Based on the new Board-approved distribution policy, subject to the conditions, a designation of up to
the maximum amount available for designation $115 million of IFC’s retained earnings for grants to
was $230 million. On August 9, 2018, the Board of IDA. These designations are expected to be noted
Directors approved a designation of $70 million of with approval by the Board of Governors, and, subject
IFC’s retained earnings for IFC’s CMAW, $45 million to the above conditions, concluded, in FY19.
of IFC’s retained earnings for Advisory services, and,

Selected financial data as of and for the last five fiscal years
(US$ millions)
AS OF AND FOR THE YEARS ENDED JUNE 30 2018 2017 2016 2015 2014
Consolidated income highlights:

Income from loans and guarantees, including realized
gains and losses on loans and associated derivatives $ 1,377 $ 1,298 $ 1,126 $ 1,123 $ 1,065
Provision for losses on loans, guarantees, accrued interest
and other receivables (90) (86) (359) (171) (88)
Income from equity investments and associated derivatives 853 707 518 427 1,289
Income from debt securities, including realized gains and
losses on debt securities and associated derivatives 363 282 129 132 89
Income from liquid asset trading activities 771 917 504 467 599
Charges on borrowings (1,041) (712) (409) (258) (196)
Other income 578 528 501 505 461
Other expenses (1,662) (1,617) (1,464) (1,423) (1,418)
Foreign currency transaction gains and losses on non-
trading activities 123 (188) (46) 53 (19)
Income before net unrealized gains and losses on non-
trading financial instruments accounted for at fair value
and grants to IDA 1,272 1,129 500 855 1,782
Net unrealized gains and losses on non-trading financial
instruments accounted for at fair value 88 394 (204) (106) (43)
Income before grants to IDA 1,360 1,523 296 749 1,739
Grants to IDA (80) (101) (330) (340) (251)
Net income (loss) 1,280 1,422 (34) 409 1,488
Less: Net (gains) losses attributable to non-controlling
interests – (4) 1 36 (5)
Net income (loss) attributable to IFC $ 1,280 $ 1,418 $ (33) $ 445 $ 1,483
AS OF AND FOR THE YEARS ENDED JUNE 30 2018 2017 2016 2015 2014
Consolidated balance sheet highlights:

Total assets $ 94,272 $ 92,254 $ 90,434 $ 87,548 $ 84,130
Liquid assets1 38,936 39,192 41,373 39,475 33,738
Investments 42,264 40,519 37,356 37,578 38,176
Borrowings outstanding, including fair value adjustments 53,095 54,103 55,142 51,265 49,481
Total capital $ 26,136 $ 25,053 $ 22,766 $ 24,426 $ 23,990
of which
Undesignated retained earnings $ 23,116 $ 21,901 $ 20,475 $ 20,457 $ 20,002
Designated retained earnings 190 125 133 184 194
Capital stock 2,566 2,566 2,566 2,566 2,502
Accumulated other comprehensive income (loss) (AOCI) 264 458 (431) 1,197 1,239
Non-controlling interests – 3 23 22 53
1. Net of securities sold under repurchase agreements, payable for cash collateral received and associated derivatives.

KEY FINANCIAL RATIOS 2018 2017 2016 2015 2014
Financial ratiosa:
Return on average assets (GAAP basis) b 1.4% 1.6% 0.0% 0.5% 1.8%
Return on average assets (non-GAAP basis) c 1.4% 1.3% 0.5% 1.3% 1.8%
Return on average capital (GAAP basis) d
5.0% 5.9% (0.1)% 1.8% 6.4%
Return on average capital (non-GAAP basis) e 5.1% 4.9% 1.8% 4.6% 6.5%
Overall liquidity ratio f
100% 82% 85% 81% 78%
External funding liquidity levelg N/A N/A 504% 494% 359%
Debt to equity ratio h 2.5:1 2.7:1 2.8:1 2.6:1 2.7:1
Total reserves against losses on loans to total disbursed
portfolio i 5.1% 6.1% 7.4% 7.5% 6.9%
Capital measures:
Total Resources Required ($ billions) j 20.1 19.4 19.2 19.2 18.0
Total Resources Available ($ billions) k 24.7 23.6 22.5 22.6 21.6
Strategic Capital l
4.6 4.2 3.3 3.4 3.6
Deployable Strategic Capitalm 2.2 1.8 1.0 1.1 1.4
Deployable Strategic Capital as a percentage of Total
Resources Available 9% 8% 4% 5% 7%
a. Certain financial ratios, as described below, are calculated excluding the effects of unrealized gains and losses on investments, other
non-trading financial instruments, AOCI, and impacts from consolidated Variable Interest Entities (VIEs).
b. Net income for the fiscal year as a percentage of the average of total assets at the end of such fiscal year and the previous fiscal year.
c. Return on average assets is defined as Net income, excluding unrealized gains/losses on investments accounted for at fair value,
income from consolidated VIEs and net gains/losses on non-trading financial investments, as a percentage of total disbursed loan and
equity investments (net of reserves), liquid assets net of repos, and other assets averaged for the current and previous fiscal year.
d. Net income for the fiscal year as a percentage of the average of total capital (excluding payments on account of pending
subscriptions) at the end of such fiscal year and the previous fiscal year.
e. Return on average capital is defined as Net income, excluding unrealized gains/losses on investments accounted for at fair value,
income from consolidated VIEs and net gains/losses on non-trading financial investments, as percentage of the paid-in share capital
and accumulated earnings (before certain unrealized gains/losses and excluding cumulative designations not yet expensed) averaged
for the current and previous fiscal year.
f. Overall Liquidity Policy states that IFC would at all times maintain a minimum level of liquidity, plus undrawn borrowing commitments
from the IBRD, that would cover at least 45% of the next three years’ estimated net cash requirements.
g. This ratio was discontinued at the end of FY17 since it was no longer considered a key ratio for IFC.
h. Leverage (Debt/equity) ratio is defined as the number of times outstanding borrowings plus committed guarantees cover paid-in
capital and accumulated earnings (net of retained earnings designations and certain unrealized gains/losses).
i. Total reserves against losses on loans to total disbursed loan portfolio is defined as reserve against losses on loans as a percentage of
the total disbursed.
j. Total resources required (TRR) is the minimum capital required to cover the expected and unexpected loss on IFC’s portfolio, calibrated
to maintain IFC’s triple-A rating. TRR is the sum of the economic capital requirements for IFC’s different assets, and it is determined by
the absolute size of the committed portfolio, the product mix (equity, loans, short-term finance, and Treasury portfolio assets), and by
operational and other risks.
k. Total resources available (TRA) is the total capital of the Corporation, consisting of (i) paid-in capital; (ii) retained earnings net of
designations and some unrealized gains and losses; and (iii) total loan loss reserves. TRA grows based on retained earnings (profit
minus distributions) and increases in reserves.
l. Total resources available less total resources required.
m. 90% of total resources available less total resources required.

COMMITMENTS
In FY18, the Long-Term Finance program was

$11,630 million, as compared to $11,854 million in
FY17 and Core Mobilization was $11,671 million, as
compared to $7,462 million for FY17, a total increase
of 21%.
In addition, the average outstanding balance for

Short-Term Finance was $3,435 million at June 30,
2018, as compared to $3,185 million at June 30, 2017.
CORE MOBILIZATION
Core Mobilization is financing from entities other than

IFC that becomes available to clients due to IFC’s
direct involvement in raising resources. IFC finances
only a portion, usually not more than 25%, of the cost
of any project. All IFC-financed projects, therefore,
require other financial partners.
FY18 and FY17 long-term

finance and core mobilization
(US$ millions)
FY18 FY17
Total Long-Term Finance and
Core Mobilization $23,301 $19,316
Total Long-Term Finance $11,630 $11,854
Total Core Mobilization $11,671 $ 7,462

Asset Management Company (AMC)
Funds managed by AMC and their activities FY18 vs FY17
(US$ millions unless otherwise indicated)
THROUGH JUNE 30, 2018
TOTAL FUNDS RAISED

SINCE INCEPTION FOR THE YEAR ENDED JUNE 30, 2018
INVESTMENT
FROM CUMULATIVE COMMITMENTS INVESTMENT
FROM OTHER INVESTMENT MADE BY DISBURSEMENTS
TOTAL IFC INVESTORS COMMITMENTS** FUND*** MADE BY FUND
Investment Period
IFC Catalyst Fund, LP, IFC Catalyst Fund
(UK), LP and IFC Catalyst Fund (Japan), LP
(collectively, Catalyst Funds) $ 418 $ 75 $ 343 $ 379 $ 73 $ 70
IFC Global Infrastructure Fund, LP
(Global Infrastructure Fund)* 1,430 200 1,230 891 23 44
China-Mexico Fund, LP (China-Mexico Fund) 1,200 – 1,200 320 – 75
IFC Financial Institutions Growth Fund, LP
(FIG Fund) 505 150 355 133 – –
IFC Global Emerging Markets Fund of Funds,
LP and IFC Global Emerging Markets
Fund of Funds (Japan Parallel), LP
(collectively, GEM Funds) 800 150 650 397 189 120
IFC Middle East and North Africa Fund, LP
(MENA Fund) 162 60 102 52 25 2
Women Entrepreneurs Debt Fund, LP
(WED Fund) 115 30 85 87 19 32
IFC Emerging Asia Fund, LP (Asia Fund) 693 150 543 90 20 11
Post Investment Period

IFC Capitalization (Equity) Fund, L.P.
(Equity Capitalization Fund) 1,275 775 500 1,226 – –
IFC Capitalization (Subordinated Debt) Fund,
L.P. (Sub-Debt Capitalization Fund) 1,725 225 1,500 1,614 – –
IFC African, Latin American and Caribbean
Fund, LP (ALAC Fund) 1,000 200 800 876 – 25
Africa Capitalization Fund, Ltd.
(Africa Capitalization Fund) 182 – 182 130 – –
IFC Russian Bank Capitalization Fund, LP
(Russian Bank Cap Fund)**** 550 250 300 82 – –
Total $10,055 $2,265 $7,790 $6,277 $349 $379
* Includes co-investment fund managed by AMC on behalf of Fund LPs.

** Net of commitment cancellations.
*** Excludes commitment cancellations from prior periods.
**** The Russian Bank Cap Fund has completed the exit from all its investments and was liquidated during FY18.

THROUGH JUNE 30, 2017
TOTAL FUNDS RAISED

SINCE INCEPTION FOR THE YEAR ENDED JUNE 30, 2017
INVESTMENT
FROM CUMULATIVE COMMITMENTS INVESTMENT
FROM OTHER INVESTMENT MADE BY DISBURSEMENTS
TOTAL IFC INVESTORS COMMITMENTS** FUND*** MADE BY FUND
IFC Capitalization (Equity) Fund, L.P.

(Equity Capitalization Fund) $1,275 $ 775 $ 500 $1,226 $ – $ –
IFC Capitalization (Subordinated Debt)
Fund, L.P. (Sub-Debt Capitalization Fund) 1,725 225 1,500 1,619 – –
IFC African, Latin American and Caribbean
Fund, LP (ALAC Fund) 1,000 200 800 901 36 14
Africa Capitalization Fund, Ltd.
(Africa Capitalization Fund) 182 – 182 130 – –
IFC Russian Bank Capitalization Fund, LP
(Russian Bank Cap Fund)**** 550 250 300 82 – –
IFC Catalyst Fund, LP, IFC Catalyst Fund
(UK), LP and IFC Catalyst Fund (Japan), LP
(collectively, Catalyst Funds) 418 75 343 306 49 48
IFC Global Infrastructure Fund, LP
(Global Infrastructure Fund)* 1,430 200 1,230 868 189 151
China-Mexico Fund, LP (China-Mexico Fund) 1,200 – 1,200 320 180 43
IFC Financial Institutions Growth Fund, LP
(FIG Fund) 505 150 355 133 – 37
IFC Global Emerging Markets Fund of Funds,
LP and IFC Global Emerging Markets Fund
of Funds (Japan Parallel), LP (collectively,
GEM Funds) 800 150 650 207 99 44
IFC Middle East and North Africa Fund, LP
(MENA Fund) 162 60 102 27 15 15
Women Entrepreneurs Debt Fund, LP
(WED Fund) 110 30 80 70 40 45
IFC Emerging Asia Fund, LP (Asia Fund) 440 150 290 69 67 70
Total $9,797 $2,265 $7,532 $5,958 $675 $467
* Includes co-investment fund managed by AMC on behalf of Fund LPs.

** Reported net of commitment cancellations in FY18. FY17 amounts have been updated for consistency with the FY18 methodology.
*** Excludes commitment cancellations from prior periods.
**** The Russian Bank Cap Fund has completed the exit from all its investments and was liquidated during FY18.

LETTER TO THE
BOARD OF GOVERNORS
The Board of Directors of IFC has

had this annual report prepared in
accordance with the Corporation’s
by-laws. Jim Yong Kim, President
of IFC and Chairman of the Board of
Directors, has submitted this report
with the audited financial statements
to the Board of Governors. The
Directors are pleased to report that,
for the fiscal year ended June 30,
2018, IFC expanded its sustainable
development impact through private
sector investments and advice.

Stay Connected
WEB & SOCIAL MEDIA RESOURCES
IFC’s website, www.ifc.org, provides comprehensive

information on every aspect of our activities. It
includes contact information for offices worldwide,
news releases and feature stories, data on results
measurement, disclosure documents for proposed
investments, and key policies and guidelines.
The online version of IFC’s 2018 Annual Report,

www.ifc.org/annualreport, provides downloadable
PDFs of all materials in this volume and translations
as they become available. Follow the report on social
media: #ifcar18
IFC ONLINE CREDITS Cover Page 36

Lucamanieri/Getty Chaldal
IFC website IFC ANNUAL REPORT TEAM: Page 1 Page 37
ifc.org Dominic Chavez/IFC 500 Luchadores
Mame Annan-Brown
Annual Report Manager, IFC External Page 2 Page 38–39
ifc.org/AnnualReport Relations Grant Ellis/World Bank Dominic Chavez/IFC
Social Media Index Joseph Rebello Page 3 Page 40–41
ifc.org/SocialMediaIndex Chief Editor Marcia Juzga/World Bank Dominic Chavez/IFC
Facebook Rob Wright Page 7 Page 42
facebook.com/IFCwbg Lead, Brand Management Cameron Davidson Goodlife
and Marketing
Twitter Page 9 Page 43
twitter.com/IFC_org Aaron Rosenberg Cameron Davidson Dominic Chavez/IFC
Chief of Public Affairs David Hills
LinkedIn Page 46–47
linkedin.com/company/ M.A. Deviah Grant Ellis/World Bank
ARTESP
IFClinkedin Editorial Consultant Page 11 Autif Sayyed/IFC
YouTube Alice Ngoc-Anh Cao Sven Torfinn/Panos Pictures
Page 48–49
youtube.com/IFCvideocasts Communications Consultant Page 12–13 Jason Chute
Instagram Adrian Romero Cazares Kessudap/iStock
Page 50
instagram.com/IFC_org/ Team Assistant Page 14–15 Thommen Jose/IFC
Medium Design: Victor J. Blue/Bloomberg
Page 51
medium.com/@IFC_org Addison Page 16–17 Chor Sokunthea/IFC
www.addison.com Dhiraj Singh/Bloomberg
SoundCloud Page 54
soundcloud.com/IFC_org Printing: Page 18 Dominic Chavez/IFC
Sandy Alexander Scott Wallace/World Bank
Scribd Page 55
www.sandyinc.com
scribd.com/IFCpublications Page 19 Nicholas Bertrand/Taimani
Dhiraj Singh/Bloomberg Films/World Bank
Page 26–27 Page 56–57

Karel Prinsloo/IFC Karel Prinsloo/IFC
Page 28–29 Page 58–59

Truong Vu Minh Hieu/IFC Raju Ghosh/National
Mission for Clean Ganga
Page 30
Sun_Shine/Shutterstock Page 60
Dominic Chavez/IFC
Page 31
Paul Kennedy/Alamy Page 61
Wissam Nassar/IFC
Page 34–35
Bluedog Studio/
Shutterstock

2121 PENNSYLVANIA AVENUE, NW
WASHINGTON, DC 20433 USA
IFC.ORG

IFC AR18 Full Report

Uploaded by

Copyright:

Available Formats

IFC AR18 Full Report

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

IFC AR18 Full Report

Uploaded by

Copyright:

Available Formats

Annual Report 2018

Cover: To maximize finance for development, IFC follows

IFC ANNUAL REPORT 2018 | 1

IFC ANNUAL REPORT 2018 | 2

It’s not an exaggeration to say First, to accelerate inclusive, sustainable economic

IFC ANNUAL REPORT 2018 | 3

The International Bank for Reconstruction and

IFC ANNUAL REPORT 2018 | 4

IFC ANNUAL REPORT 2018 | 5

Fiscal 2018 was a historic year for the

IFC ANNUAL REPORT 2018 | 6

ROLLING OUT • Improved Project Selection, with two new tools.

NEW TOOLS AND The first is the Anticipated Impact Measurement

IFC ANNUAL REPORT 2018 | 7

IFC delivered record levels

NEW This growth reflects an unprecedented level of

STRUCTURE Nearly 30 percent of our commitments went to

DELIVERING Philippe Le Houérou

IFC ANNUAL REPORT 2018 | 8

Stephanie von Friedeburg Georgina Baker Elena Bourganskaia Marcos Brujis

Karin Finkelston Mohamed Gouled Jingdong Hua Hans Peter Lankes

Monish Mahurkar Sérgio Pimenta Nena Stoiljkovic Ethiopis Tafara

IFC ANNUAL REPORT 2018 | 9

IFC ANNUAL REPORT 2018 | 10

IFC ANNUAL REPORT 2018 | 11

IFC ANNUAL REPORT 2018 | 12

IFC ANNUAL REPORT 2018 | 13

This year, shareholders endorsed our new strategy with a record

IFC ANNUAL REPORT 2018 | 14

IFC ANNUAL REPORT 2018 | 15

IFC ANNUAL REPORT 2018 | 16

IFC ANNUAL REPORT 2018 | 17

IFC ANNUAL REPORT 2018 | 18

IFC ANNUAL REPORT 2018 | 19

COLUMBIA PROJECT FINANCE

IFC ANNUAL REPORT 2018 | 20

Project Finance International: Greentech Foundation:

IFC ANNUAL REPORT 2018 | 21

IFC ANNUAL REPORT 2018 | 22

IFC ANNUAL REPORT 2018 | 23

IFC ANNUAL REPORT 2018 | 24

IFC ANNUAL REPORT 2018 | 25

IFC ANNUAL REPORT 2018 | 26

REMOVING IFC and the World Bank Group have introduced

IN TOUGH investment risks with development institutions.

We used the window for the first time to unlock

FY18 marked a milestone for an IFC-led PPP project

IFC ANNUAL REPORT 2018 | 27

That’s more than enough to cover the $4.5 trillion in financing that

IFC is a global leader in mobilizing private capital. We do it through

The Managed Co-­Lending Portfolio Program is our main loan-­

We continue to introduce fresh innovations, including credit-­

Credit mobilization helped IFC provide $185 million to Vietnam

In 2018, the IFC Emerging Asia Fund — managed by IFC Asset

IFC ANNUAL REPORT 2018 | 28

IFC ANNUAL REPORT 2018 | 29

BUILDING They drive growth, helping companies to expand

Such markets, however, remain small in developing

STABILITY a third of the world’s economic output, developing

The Managed Co-Lending Portfolio Program is our main loan-

We continue to introduce fresh innovations, including credit-

Photo (above): In Uzbekistan, IFC’s sum-

IFC’s $200 million investment through offshore local-currency

Our investment decisions increasingly are driven by climate-