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Risk transfer for MDBs: Transferring risk to lend more

Author

Listed:
  • Perraudin, William

    (Risk Control Limited, UK)

  • Galizia, Federico

    (Washington DC, USA)

  • Powell, Andrew

    (Williams College, USA)

  • Turner, Timothy

    (The Trade & Development Bank, Kenya)

Abstract

Long-term development finance provided by multilateral development banks (MDBs) is key to advancing the United Nations’ Sustainable Development Goals (UN SDGs). MDBs are, however, constrained by the availability of capital. Risk transfer can shift risk from their balance sheets to expand lending. This paper explains how ground-breaking securitisation transactions have been used by MDBs and argues that, while there are challenges, this technique has significant potential to increase development lending.

Suggested Citation

  • Perraudin, William & Galizia, Federico & Powell, Andrew & Turner, Timothy, 2025. "Risk transfer for MDBs: Transferring risk to lend more," Journal of Risk Management in Financial Institutions, Henry Stewart Publications, vol. 18(2), pages 185-196, March.
    • Handle: RePEc:aza:rmfi00:y:2025:v:18:i:2:p:185-196
    as

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    More about this item

    Keywords

    risk transfer; international financial architecture; G20; multilateral development banks; securitisation; rating agencies; preferred creditor treatment; development;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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