35th 1430H - Islamic Development Bank

1430H IN REVIEWPresident of Turkmenistan, Gurbanguly Berdimuhamedov, and President of IDB, Dr. Ahmad Mohamed Ali, atthe Annual Meeting 2009 of the Islamic Development Bank, held in Ashgabat, Turkmenistanstand-alone project. They reinforced the capacities ofvarious stakeholders in member countries includingministries, executing agencies, non-governmentalorganizations, community groups and others.FINANCIAL RESULTS AND RISKMANAGEMENTFinancial ResultsIn 1430H, the net income from OCR amounted toID124.8 million, (Table 1) showing a level similarto the pre-crises (food, financial and economic) levelin 1427H.Adopting Comprehensive Risk ManagementFrameworkReviewing Risk Management Guidelines: The Bankhas put in place a comprehensive risk managementframework to address all types of credit, market,and operational risks. Given the nature of the Bank’sactivities, country risk and liquidity risk are givenspecial attention. With regard to country risk, acomprehensive framework with appropriate exposurelimits has been implemented.IDB continues to maintain the highestcredit ratings, reflecting the strongsupport of its member countries, and itsfinancial soundness.As regards the liquid fund portfolio, a frameworkhas been implemented for determining maximumand minimum liquidity requirements together withassigning exposure limits for counterparties as well asconcentration limits at country and bank levels. IDBregularly carries out reviews of its risk managementguidelines based on market developments and bestpractices.Maintaining the Highest Credit Ratings: IDBcontinues to maintain the highest credit ratings of“AAA” from Fitch Ratings, Standard & Poor’s andMoody’s reflecting the strong support of its membercountries, its financial soundness and the conservativefinancial and risk management policies adopted.The Basel Committee on Banking Supervision hasdesignated IDB as a ‘Zero-Risk Weighted’ MultilateralDevelopment Bank (MDB). The Commission of theEuropean Communities also designated IDB as anMDB eligible to benefit from a zero-risk weight, aslaid down in the relevant instruments of the EuropeanUnion.Monitoring Credit Worthiness: In the course ofassessing the potential impact of the global financialcrisis on the Bank and its member countries, a highlevel Global Financial Crisis Monitoring Team assesseson regular basis the credit worthiness and repaymentability of member countries and other counterparties.Necessary measures have been taken to mitigate therisks arising from the worldwide financial turbulence.TRANSFORMING IDB GROUP INTO APREEMINENT DEVELOPMENT INSTITUTIONDriven by the recommendations of Vision 1440Hdocument and substantial changes in its strategicenvironment, IDB Group has accelerated theimplementation of its major reform program initiatedin 2007 to enhance the Group’s role as the preeminentdevelopment institution of Ummah and to improve itsrelevance and impact in member countries. Ultimately,the reform program will enable the institution to meetthe needs and expectations of member countries,prepare the institution to meet future challenges andIDB ANNUAL REPORT 1430H 7