Funding Margin

The Funding Cost Margin is a component of the interest rate of the Bank’s Non-Sovereign Guaranteed Loans (NSGLs) and Sovereign Guaranteed Loans (SGLs) under the African Development Bank (ADB) window.  It reflects the prior semester’s weighted average of the difference between:

• the refinancing rate of the Bank as to the borrowings in the capital markets linked to the respective reference rate (6-month LIBOR for USD and JPY, 6- month EURIBOR for EUR and 3-month JIBAR for ZAR), and allocated to all its floating interest loans denominated in the respective currency and,
• the respective reference rate (6-month LIBOR for USD and JPY, 6-month EURIBOR for EUR and 3-month JIBAR for ZAR) for each semester ending on 30 June and on 31 December. 

The Funding Cost Margin shall be determined twice per year on 1 January for the semester ending on 31 December and on 1 July for the semester ending on 30 June.  This spread shall apply to the respective reference rate (6-month LIBOR for USD and JPY, 6-month EURIBOR for EUR and 3 month JIBAR for ZAR) which resets on 1 February and on 1 August for all loans under the ADB lending window. 

 

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