Thirty Development Banks Adopted Expanded Methodologies for Mobilising Global Private Finance

Thirty multilateral development banks and development finance institutions released expanded joint methodologies for measuring private finance on 1 October, after all 30 members endorsed them. The package updates the definition of mobilisation, adds a new generation measure and sets out work towards a future catalysation measure. The 30 participating institutions said the framework would underpin their future annual reporting.

The package is the first major update to the joint mobilisation methodology since 2018. It responds to the G20's call, first set out in a 2024 Viewpoint Note, to revise the joint methodology to expand the coverage of mobilisation. The group includes the World Bank, the African Development Bank, the Asian Development Bank, the Inter-American Development Bank and the European Bank for Reconstruction and Development.

MEASUREMENT EXPANDS BEYOND PROJECT CO-FINANCE

The revised mobilisation measure covers private financing made available for a project when a participating institution also provides finance, a guarantee or qualifying advisory or transaction support. Updated attribution rules address transactions involving several institutions and are intended to limit double counting. The methodology also adds indicators for public and portfolio-based mobilisation and clarifies which advisory services can qualify.

The new generation indicator measures finance raised for development activity using an institution's balance sheet, credit rating or other attributes, regardless of the risk attached to a particular recipient or project. A separate catalysation methodology remains under development and is intended to capture private finance arising from institutional activity beyond own-account finance and mobilisation. The statement said the indicators are distinguished by the risk investors take, the timing of the financing and whether an MDB or DFI also finances the activity.

TRANSPARENCY WILL TEST THE NEW FRAMEWORK

The updated guidance covers originate-to-distribute structures, securitisation, guarantees, risk transfers and foreign-exchange hedging. Reuters said these tools include collateralised loan obligations and significant risk transfers that can release lending capacity by passing credit risk to private investors. Reuters noted that the EBRD launched a EUR1 billion significant risk transfer in May, which the bank called "a major milestone" in mobilising private capital.

OECD data show that official development-finance interventions mobilised more than USD600 billion in private finance from 2012 to 2024. "This comes from common shareholder, and stakeholder, pressure to do more with the capital that we have," Daniel Borrego Cubero, head of debt mobilisation product development at the EBRD, told Reuters.