Multilateral Investment Guarantee Agency (MIGA), which houses the World Bank Group Guarantee Platform, has provided a $197.67 million guarantee to Citibank N.A. The five-year guarantee supports Citi’s non-shareholder loan extended to the State Bank of India (SBI).
Furthermore, the guarantee will allow SBI to refinance the outstanding principal of a $500 million World Bank loan extended to it in 2016 for grid-connected rooftop solar photovoltaic systems. The loan supports a national programme aimed at supplying grid-connected rooftop solar photovoltaic systems to commercial and industrial customers across India. Additionally, the guarantee will protect Citi against the risk of non-honouring of financial obligations by a state-owned enterprise. It will also support the next phase of an established clean energy initiative.
This financing will enable SBI to lower its borrowing costs and broaden its funding base. Additionally, MIGA’s guarantee creates space for further World Bank lending to the Indian Government by shifting the loan exposure to the balance sheets of commercial lenders.
