International Bank for Reconstruction and Development

The International Bank for Reconstruction and Development (IBRD) and International Monetary Fund (IMF) were established by delegates at the Bretton Woods Conference in 1944 and became operational in 1946. According to a March 2012 Washington Post article, IBRD was the "original 'world bank'".

IBRD field offices were opened in Paris, France, Copenhagen, Denmark, and Prague in the former Czechoslovakia.

The IBRD was established with the original mission of financing the reconstruction efforts of war-torn European nations following World War II, with goals shared by the later Marshall Plan. The Bank issued its inaugural loan of $250 million ($2.6 billion in 2 dollars) to France in 1947 to finance infrastructure projects.

In 1946, a few months after it became operational, Chile sought financial help from the IBRD—the first of the developing countries to do so.

Throughout the remainder of the 1940s and 1950s, the Bank-financed projects sought to dam rivers, generate electricity and improve access to water and sanitation. It also invested in France, Belgium, and Luxembourg's steel industry. Following the reconstruction of Europe, the Bank's mandate has transitioned to eradicating poverty around the world.

In 1960, the International Development Association (IDA) was established to serve as the Bank's concessional lending arm and provide low and no-cost finance and grants to the poorest of the developing countries as measured by gross national income per capita.

The IBRD is restricted in its borrowing, as it cannot provide loans in competition with private capital; IBRD loans have to be tied to specific projects; and the IBRD will normally only finance the direct foreign exchange costs of a project.

At the time of its creation, the IBRD was the only Multilateral Development Bank. During the period of decolonization—the mid‐1950s to the mid‐1970s—several MDBs were created—the International Finance Corporation, the International Development Association. They were both WBG members. During this period other MDBs that were similar to the IBRD in their governance and operations, were established by countries that were not member nations of the WBG. This included the Inter‐American Development Bank (IDB), the African Development Bank (AfDB), the Asian Development Bank (ADB), the Development Bank of Latin America and the Caribbean (CAF), and the Islamic Development Bank (IsDB). Both the CAF and IsDB are "primarily owned and controlled by borrower countries."

The IBRD provides financial services as well as strategic coordination and information services to its borrowing member countries. The Bank only finances sovereign governments directly, or projects backed by sovereign governments. The World Bank Treasury is the division of the IBRD that manages the Bank's debt portfolio of over $100 billion and financial derivatives transactions of $20 billion.

The Bank offers flexible loans with maturities as long as 30 years and custom-tailored repayment scheduling. The IBRD also offers loans in local currencies. Through a joint effort between the IBRD and the International Finance Corporation, the Bank offers financing to subnational entities either with or without sovereign guarantees. For borrowers needing quick financing for an unexpected change, the IBRD operates a Deferred Drawdown Option which serves as a line of credit with features similar to the Bank's flexible loan program. Among the World Bank Group's credit enhancement and guarantee products, the IBRD offers policy-based guarantees to cover countries' sovereign default risk, partial credit guarantees to cover the credit risk of a sovereign government or subnational entity, and partial risk guarantees to private projects to cover a government's failure to meet its contractual obligations. The IBRD's Enclave Partial Risk Guarantee covers private projects in member countries of the IDA against sovereign governments' failures to fulfil contractual obligations. The Bank provides an array of financial risk management products including foreign exchange swaps, currency conversions, interest rate swaps, interest rate caps and floors, and commodity swaps. To help borrowers protect against catastrophes and other special risks, the bank offers a Catastrophe Deferred Drawdown Option to provide financing after a natural disaster or declared state of emergency. It also issues catastrophe bonds which transfer catastrophic risks from borrowers to investors. The IBRD reported $23.2 billion in lending commitments for 100 projects in fiscal year 2019. The top 10 borrowers were India, Indonesia, Jordan, Egypt, Argentina, China, Morocco, Turkey, Ukraine and Colombia. The most supported sector was Public Administration.