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The New Development Bank (NDB) being launched by the BRICS group of emerging economies plans to raise money both on local markets and internationally, its president said on Thursday.
The bank, with an initial capital of $50 billion, is being introduced at an organisational summit the BRICS countries - Brazil, Russia, India, China and South Africa - in the Russian city of Ufa.
The summit is a showcase for Russian President Vladimir Putin, and comes at a time when Moscow's ties with the West are strained because of the Ukraine crisis.
Kundapur Vaman Kamath, 67, a former executive with India's largest private bank, ICICI Bank, was appointed president of NDB in May this year. The bank is headquartered in Shanghai, China.
The bank, which the BRICS countries see as an alternative to the World Bank, will have its capital expanded to $100 billion within the next couple of years. It plans to issue its first loans, yet to be agreed, in April - a plan Kamath said was on track.
"We will explore resource raising on various markets - hard currency markets and local currency markets," Kamath said in an interview to Reuters in Ufa.
He added NDB will seek international and local agencies ratings - a necessary step for issuing debt.
"We are a clean sheet of paper, so I will get to Shanghai this week, (or) next week and we will sequence it," Kamath said when asked on timing for getting ratings cleared.
In a major shift from the way multilateral lenders functions, borrowers' interest will be paramount for NDB against the common practice of lenders' view getting preference, Kamath said.
"Our aim will be that we do not see only from the point of view of the lenders, but also from the point of view of the borrowers," he told PTI.
Stating that the lenders generally keep their own interest in mind, Kamath said NDB will try to bring in innovation.
"Innovation is something that we will try to bring about in the working of the multilateral banks.... One of the areas that we will focus is that lenders want the borrowers to follow a certain timeline. We need to see what innovation is required to ensure that this timeline is met or to try and reduce this timeline, Kamath said. "We will look at product innovation, resource innovation, the delivery innovation and the most importantly the process innovation. We will look to bring in innovation in the entire process followed in the working of a multilateral bank."
Kamath also said that the new bank will strive to approve its first loan before end of the current financial year.
