IFC launches platform to mobilise $5 bln for infrastructure investments in emerging markets
Source: Middle East Insurance Review | Nov 2016
IFC, a member of the World Bank Group, has launched an innovative programme that aims to raise US$5 billion from global institutional investors to modernise infrastructure in emerging markets over the next five years, opening up a new stream of capital flows to improve power, water, transportation, and telecommunications systems in developing countries.
The initiative, called MCPP Infrastructure, builds on the success of IFC’s Managed Co-Lending Portfolio Programme, a loan-syndications initiative that enables third-party investors to participate passively in IFC’s senior loan portfolio. In its first phase, the programme allocated $3 billion from the People’s Bank of China across 70 deals in less than two years. It demonstrated how large investors can benefit from delegating the processes of deal origination and approvals to IFC.
The first partnership under the programme was signed with the global insurance company Allianz. Under the agreement, Allianz intends to invest $500 million, which will be channelled into IFC debt financing for infrastructure projects in emerging markets. IFC is also in advanced discussions with Eastspring Investments, the Asian asset management business of Prudential, for a commitment of $500 million. Similar discussions are being conducted with AXA, also for a commitment of $500 million.
MCPP Infrastructure is designed for institutional investors seeking to increase their exposure to emerging-markets infrastructure. IFC will originate, approve, and manage the portfolio of loans that will mirror IFC’s own portfolio in infrastructure. It will do so in a manner agreed upfront with its partner investors, always subject to the overall governance of the platform.