ADB and JPMorgan form risk sharing agreement

by Richard Kilner

Story link: ADB and JPMorgan form risk sharing agreement

Today US bank JPMorgan and the Asian Development Bank (ADB) announced that they have formed a risk sharing agreement with one another.

Under the Risk Participation Agreement, initiative assistance for international trade occurring in Asia will be bolstered by enlarging trade finance facilities to a number of selected financial institutions.

Transactions covered will range from short-term credit letters to two year long tenors.

S. Chander, the ADB’s deputy director general of private sector operations, has said that the organisation is pleased to be working alongside JPMorgan to share the risk.

Chander went on to explain that the ADB sought to enhance economic growth by fostering trade links through the creation of public-private partnerships.

For its part, JPMorgan will benefit from the ADB’s AAA credit rating, and see its risk mitigation capabilities increased.

The program will be launched in a number of phases, being initially launched in Pakistan, Bangladesh, and Sri Lanka and then expanding to include Vietnam, the Philippines, and Indonesia.