Annual Report 2008 - Asian Development Bank

ANNUAL REPORT

VOLUME 2||FINANCIAL REPORT FINANCIAL REPORT

About the Asian Development Bank

ADB’s vision is an Asia and Pacific region free of poverty. Its mission is to help its developing

member countries substantially reduce poverty and improve the quality of life of their people.

Despite the region’s many successes, it remains home to two thirds of the world’s poor:

1.8 billion people who live on less than $2 a day, with 903 million struggling on less than

$1.25 a day. ADB is committed to reducing poverty through inclusive economic growth,

environmentally sustainable growth, and regional integration.

Based in Manila, ADB is owned by 67 members, including 48 from the region. Its main

instruments for helping its developing member countries are policy dialogue, loans, equity

investments, guarantees, grants, and technical assistance.

© 2009 Asian Development Bank

Every effort has been made to ensure the accuracy of the data used in this publication. Variations in data in ADB publications often result from different publication dates, although differences may also come from source and interpretation of data. ADB accepts no responsibility from any consequence of their use.

The term “country,” as used in the context of ADB, refers to a member of ADB and does not imply any view on the part of ADB as to the member’s sovereignty or independent status.

In this publication, $ refers to US dollars.

ISSN 306-8370

Printed in the Philippines.

The ADB Annual Report 2008 comprises two separate volumes: Volume 1 is the main report and Volume 2 contains the financial statements and statistical annexes.

2008ANNUAL REPORT

VOLUME 2|FINANCIAL REPORT

FINANCIAL STATEMENTS AND REPORTS OF INDEPENDENT AUDITORS

I. MANAgEMENT’S DISCUSSION AND ANALySISOverview 6Ordinary Capital Resources 7Special Funds 24grant Cofinancing 30

II. ORDINARy CAPITAL RESOURCES (OCR) Management’s Report on Internal Control over Financial Reporting 33Report of Independent Auditors 34OCR-1 Balance Sheet, 31 December 2008 and 2007 36OCR-2 Statement of Income and Expenses for the years Ended 31 December 2008 and 2007 38OCR-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 39OCR-4 Statement of Changes in Capital and Reserves for the years Ended 31 December 2008 and 2007 40OCR-5 Summary Statement of Loans, 31 December 2008 and 2007 42OCR-6 Summary Statement of Borrowings, 31 December 2008 and 2007 44OCR-7 Statement of Subscriptions to Capital Stock and Voting Power, 31 December 2008 46OCR-8 Notes to Financial Statements, 31 December 2008 and 2007 48

III. ASIAN DEVELOPMENT FUND (ADF) Management’s Report on Internal Control over Financial Reporting 71Report of Independent Auditors 72ADF-1 Special Purpose Statement of Assets, Liabilities and Fund Balances, 31 December 2008 and 2007 74ADF-2 Special Purpose Statement of Revenue and Expenses for the years Ended 31 December 2008 and 2007 75ADF-3 Special Purpose Statement of Cash Flows for the years Ended 31 December 2008 and 2007 76ADF-4 Special Purpose Statement of Changes in Fund Balances for the years Ended 31 December 2008 and 2007 77ADF-5 Special Purpose Summary Statement of Loans, 31 December 2008 and 2007 78ADF-6 Special Purpose Statement of Resources, 31 December 2008 80ADF-7 Notes to Special Purpose Financial Statements, 31 December 2008 and 2007 81

IV. TEChNICAL ASSISTANCE SPECIAL FUND (TASF) Management’s Report on Internal Control over Financial Reporting 89Report of Independent Auditors 90TASF-1 Statement of Financial Position, 31 December 2008 and 2007 92TASF-2 Statement of Activities and Changes in Net Assets for the years Ended 31 December 2008 and 2007 93TASF-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 94TASF-4 Statement of Resources, 31 December 2008 95TASF-5 Summary Statement of Technical Assistance Approved and Effective for the year Ended 31 December 2008 96TASF-6 Notes to Financial Statements, 31 December 2008 and 2007 97

Contents

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V. JAPAN SPECIAL FUND (JSF) Management’s Report on Internal Control over Financial Reporting 101Report of Independent Auditors 102JSF-1 Statement of Financial Position, 31 December 2008 and 2007 104JSF-2 Statement of Activities and Changes in Net Assets for the years Ended 31 December 2008 and 2007 105JSF-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 106JSF-4 Notes to Financial Statements, 31 December 2008 and 2007 107

VI. ASIAN DEVELOPMENT BANk INSTITUTE SPECIAL FUND (ADBISF) Report of Independent Auditors 111ADBISF-1 Statement of Financial Position, 31 December 2008 and 2007 112ADBISF-2 Statement of Activities and Changes in Net Assets for the years Ended 31 December 2008 and 2007 113ADBISF-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 114ADBISF-4 Notes to Financial Statements, 31 December 2008 and 2007 115

VII. ASIAN TSUNAMI FUND (ATF) Management’s Report on Internal Control over Financial Reporting 121Report of Independent Auditors 122ATF-1 Statement of Financial Position, 31 December 2008 and 2007 124ATF-2 Statement of Activities and Changes in Net Assets for the years Ended 31 December 2008 and 2007 125ATF-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 126ATF-4 Notes to Financial Statements, 31 December 2008 and 2007 127

VIII. PAkISTAN EARThqUAkE FUND (PEF) Management’s Report on Internal Control over Financial Reporting 130Report of Independent Auditors 131PEF-1 Statement of Financial Position, 31 December 2008 and 2007 133PEF-2 Statement of Activities and Changes in Net Assets for the years Ended 31 December 2008 and 2007 134PEF-3 Statement of Cash Flows for the years Ended 31 December 2008 and 2007 135PEF-4 Notes to Financial Statements, 31 December 2008 and 2007 136 IX. REgIONAL COOPERATION AND INTEgRATION FUND (RCIF) Management’s Report on Internal Control over Financial Reporting 139Report of Independent Auditors 140RCIF-1 Statement of Financial Position, 31 December 2008 and 2007 142RCIF-2 Statement of Activities and Changes in Net Assets for the year Ended 31 December 2008 and for the Period 26 February to 31 December 2007 143RCIF-3 Statement of Cash Flows for the year Ended 31 December 2008 and for the Period 26 February to 31 December 2007 144RCIF-4 Notes to Financial Statements, 31 December 2008 and 2007 145 X. CLIMATE ChANgE FUND (CCF) Management’s Report on Internal Control over Financial Reporting 148Report of Independent Auditors 149CCF-1 Statement of Financial Position, 31 December 2008 151CCF-2 Statement of Activities and Changes in Net Assets for the Period 7 April to 31 December 2008 152CCF-3 Statement of Cash Flows for the Period 7 April to 31 December 2008 153CCF-4 Notes to Financial Statements, For the Period 7 April to 31 December 2008 154

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STATISTICAL ANNEXES

1 Sovereign and Nonsovereign Loan Approvals by Country, 2008 1592 Grant-Financed Project Approvals by Country, 2008 1633 Loan Approvals by Sector: 3-Year Moving Averages, 1968-1970–2006-2008 1654 Loan Approvals by Sector, 2008 1665 Sectoral Distribution of Loans, 2008, 1967–2008 169

Sectoral Distribution of Grants, 2008, 1968–2008 1696 Loan and ADF Grant Approvals, by Country and Source of Funds, 2008 1707 Projects Involving Cofinancing, 2008 1718 Loan Disbursements, 2007 and 2008 1749a Program Loan Disbursements, 2008 1749b Trends in Program Lending and Grant, 1998–2008 17510 Nonsovereign Approvals and Total Project Costs by Country, 2008 17511 Nonsovereign Approvals and Total Project Costs by Sector, 2008 17612 Nonsovereign Approvals by Year, 1983–2008 17613 Nonsovereign Approvals by Country, 1983–2008 17714 Number of Loans and Projects Approved and Under Administration,

Project Completion Reports (PCRs) Circulated, Projects Completed, Loans Closed, and Project/Program Performance Evaluation Reports (PPERs) Circulated 178

15 Amount of Loans Approved, Contracts Awarded, and Disbursements 18016 Technical Assistance Grant Approvals by Country and Regional Activities, 1967–2008, 2007, 2008 18217 Technical Assistance Grant Approvals, 2008 18418 Technical Assistance Grant Approvals by Sector, 1967–2008, 2007, 2008 19319 Consulting Services Financed Through Loans by Sector, 2008 19320 Regional Technical Assistance Activities, 2008 19421 Net Transfer of Resources (Ordinary Capital Resources and

Asian Development Fund), 2006–2008 19922 Net Transfer of Resources (Ordinary Capital Resources and

Asian Development Fund), 1999–2008 20023 Asian Development Fund Resources and Commitment Authority 20124 Technical Assistance Special Fund 20225 Japan Special Fund—Regular and Supplementary Contributions 20326 Japan Special Fund—Asian Currency Crisis Support Facility 20327 Japan Fund for Poverty Reduction, 2008 20428 Projects with ADB-Administered Grant Financing, 2007 Approvals 20529 Contracts Awarded by Country of Origin, 2008:

Project Loans—Ordinary Capital Resources 20930 Contracts Awarded by Country of Origin, 2008:

Project Loans—Asian Development Fund 21031 Contracts Awarded by Country of Origin, 2008:

Project Loans—Ordinary Capital Resources and Asian Development Fund Combined 21132 Estimates of Payment to Supplying Countries for Foreign Procurement

Under Program Lending, 2008 21233 Cumulative Contracts Awarded, By Country of Origin:

Technical Assistance Operations 21334 Contracts Awarded by Country of Origin, 2006–2008 214

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SAsian Development Bank6

MANAGEMENT’S DISCUSSION AND ANALYSISThe Asian Development Bank (ADB) is an international development financial institution whose vision is to make Asia and the Pacific free of poverty. ADB was established in 1966 through the Agreement Establishing the Asian Development Bank (the Charter), ratified by 31 countries to promote the social and economic development of the region and reduce poverty. As of 31 December 2008, ADB had 67 members, 48 of which are in the region.

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LYSIS7Annual Report 2008

ADB provides various forms of financial assistance to its

developing member countries. The main instruments are

loans, technical assistance, grants, guarantees, and equity

investments. These instruments are financed through or-

dinary capital resources (OCR), Special Funds, and various

trust funds. OCR and Special Funds are used to finance op-

erations that are solely under ADB administration. Trust

funds are externally funded and are administered by ADB

on behalf of donors. The Charter requires that funds from

each resource be kept separate from the others.

ADB also provides policy dialogues and advisory ser-

vices and mobilizes financial resources through its co-

financing operations tapping official, commercial, and

export credit sources to maximize the development im-

pact of its assistance. Cofinancing for ADB projects can be

in the form of external loans, grants for technical assistance

and components of loan projects, and credit enhancement

products such as guarantees and syndications.

ORDINARY CAPITAL RESOURCES

Funding for OCR operations comes from three distinct

sources: funds borrowed from private placements and cap-

ital markets, paid-in capital provided by shareholders, and

accumulated retained income (reserves). The financial

strength of OCR is largely based on the support of share-

holders and on financial policies and practices. Share-

holder support is reflected in the form of capital backing

from members and in the record of borrowing members in

meeting their debt service obligations.

Borrowed funds, together with equity, are used to

fund OCR lending and investment activities as well as

other general operations. Loans are generally made to de-

veloping member countries that have attained a higher

level of economic development and to private and other

nonsovereign borrowers. Sovereign loans are priced on a

cost pass-through basis in which the cost of funding the

loans plus a lending spread is passed through to the bor-

rowers. Nonsovereign loans are priced based on market

practice.

In addition to direct lending, ADB also provides guar-

antees to assist governments of developing member coun-

tries and nonsovereign borrowers secure commercial funds

for ADB-assisted projects. ADB experienced a strong and

growing demand for guarantees as credit enhancement

products.

Basis of Financial Reporting

Statutory Reporting. ADB prepares its financial statements

in accordance with accounting principles generally ac-

cepted in the United States of America. Table 1 presents

selected financial data for 2008.

ADB manages its balance sheet by selectively us-

ing derivatives to minimize the interest rate and curren-

cy risks associated with its financial assets and liabilities.

Derivative instruments are used to enhance asset and li-

ability management of individual positions and overall

portfolios, and to reduce borrowing costs.

Financial instruments including all derivatives,

structured and swapped borrowings, and marketable in-

vestments are recorded at their fair value while loans and

unswapped borrowings are recorded at carrying book val-

ue. Non-marketable equity investments are valued either

at cost less any permanent impairment, or using the eq-

uity method.

ADB complies with Financial Accounting Standards

(FAS) No. 133, “Accounting for Derivative Instruments

and Hedging Activities,” along with its related amend-

ments (collectively referred to as “FAS 133”), including

FAS 155 (Accounting for Certain Hybrid Financial Instru-

ments, an amendment to FAS 133 and 140). Effective 1

January 2008, ADB also adopted FAS 157, “Fair Value

Measurements,” and FAS 159, “The Fair Value Option

for Financial Assets and Financial Liabilities (including

an amendment of Financial Accounting Standards Board

Statement No. 115).”

FAS 133 establishes accounting and reporting stan-

dards for derivative instruments, including certain deriv-

ative instruments embedded in other contracts (collectively

referred to as derivatives), and for hedging activities. It

requires that an entity recognize all derivatives as either

assets or liabilities in the statement of financial position

and measure those instruments at fair value. FAS 133 al-

lows hedge accounting only if certain qualifying criteria are

met. An assessment of those criteria indicated that most of

ADB’s derivative transactions are highly effective in hedg-

ing the underlying transactions and are appropriate for re-

ducing funding costs. Compliance with hedge accounting

requirements will impose undue constraints on future bor-

rowings, loans, and hedge programs and will likely detract

ADB’s efforts to effectively and efficiently minimize the

funding costs for its borrowing member countries. Accord-

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TABLE 1: Selected Financial Data(31 December, amounts in $ Million)

Statutory Basis

2008 2007 2006 2005 2004

Revenue and Expenses

From Loan 1,358.0 1,442.3 1,210.1 1,036.3 1,038.3

From Investments 677.2 683.2 564.5 377.4 265.6

From Guarantees 6.9 5.1 4.1 4.1 3.5

From Equity Investments 3.7 58.9 41.5 3.3 (0.7)

From Other Sources 18.7 18.8 18.7 11.3 6.4

Total Revenue 2,064.5 2,208.3 1,838.9 1,432.4 1,313.1

Borrowings and Related Expenses 1,208.4 1,389.8 1,116.3 893.2 861.7

Administrative Expensesa 141.0 127.3 127.7 135.7 118.3

Technical Assistance to Member Countries 8.4 (0.7) (1.2) (3.4) (2.4)

Provision for Losses (3.5) (0.6) (32.5) (3.5) 2.2

Other Expenses 6.3 4.0 3.7 4.2 3.1

Total Expenses 1,360.6 1,519.8 1,214.0 1,026.2 982.9

Net Realized (Losses) Gains (28.1) 22.9 80.6 16.9 59.4

Net Unrealized Gains (Losses) 450.6 53.8 (135.4) (309.2) 41.0

Cumulative Effect of Change in Accounting Principle – – – (4.6) –

Net Income 1,126.3 765.2 570.1 109.3 430.6

Average Earning Assetsb 50,394 42,780 37,904 36,092 36,364

Annual Return on Average Earning Assets 2.24% 1.79% 1.50% 0.30% 1.18%

Return on Loans 3.84% 5.00% 4.98% 4.35% 4.16%

Return on Investments 3.20% 4.68% 4.18% 2.96% 2.21%

Cost of Borrowings 4.11% 4.32% 4.81% 5.04% 3.37%

Pre-FAS 133/159d Basis

Net Income 699.7 711.4 705.5 415.6 389.6


Annual Return on Average Earning Assetsc 1.39% 1.66% 1.86% 1.15% 1.07%

Return on Loans 4.14% 5.14% 4.94% 4.35% 4.16%

Return on Investments 3.70% 4.72% 4.27% 2.99% 2.34%

Cost of Borrowings 3.29% 4.68% 4.31% 3.75% 3.58%

Current Value Basis

Net Income 101.9 1,159.0 544.1 93.7 562.8


Annual Return on Average Earning Assets 0.20% 2.65% 1.31% 0.23% 1.47%

Return on Loans 9.18% 6.40% 2.58% (1.18%) 4.25%

Return on Investments 3.51% 7.77% 5.48% (1.11%) 3.51%

Cost of Borrowings 7.17% 5.32% 3.51% (1.34%) 3.56%

( ) = negative, FAS = Financial Accounting Standards.

a Net of administration expenses allocated to the Asian Development Fund and loan origination costs that are deferred.b Composed of investments and related swaps, outstanding loans (excluding net unamortized loan origination cost/front-end fees) and related swaps and equity investments.c Represents net income before net unrealized gains/losses on derivatives, over average earning assets.

d FAS 159 is applicable to 2008 only.

ingly, ADB elects not to adopt hedge accounting and re-

ports all derivative instruments on the balance sheet at fair

value while recognizing changes in the fair value of deriva-

tive instruments for the year as part of net income.

FAS 155 allows fair value measurement for hybrid fi-

nancial instruments that contain embedded features that

would otherwise be required to be treated as a separate

derivative instrument (bifurcated) in the reported finan-

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TABLE 2: Condensed Current Value Balance Sheets as at 31 December 2008 and 2007($ Thousand)

31 December 200831 December

2007

Statutory Basis

Reversal of FAS 133/159

EffectsaPre–FAS

133/159 BasisCurrent Value Adjustments

Current Value Basis

Current Value Basis

Due from banks $ 142,238 $ – $ 142,238 $ – $ 142,238 $ 108,821

Investments and accrued income 15,544,399 – 15,544,399 – 15,544,399 13,440,728

Securities transferred under

repurchase agreement 309,358 – 309,358 – 309,358 5,041,387

Securities purchased under

resale arrangement 511,756 – 511,756 – 511,756 427,132

Loans outstanding and accrued interest 36,150,156 (451) 36,149,705 1,622,166 37,771,871 31,434,283

Provision for loan losses and unamortizednet loan origination costs 59,088 – 59,088 – 59,088 27,087

Equity investment 641,427 (6,060) 635,367 6,060 641,427 808,157

Receivable from members 144,514 – 144,514 (50,790) 93,724 105,027

Receivable from swaps

Borrowings 23,831,087 (2,237,329) 21,593,758 2,237,329 23,831,087 17,968,867

Others 882,793 (163,125) 719,668 163,125 882,793 512,089

Other assets 504,936 – 504,936 – 504,936 463,793

TOTAL $ 78,721,752 $ (2,406,965) $ 76,314,787 $ 3,977,890 $ 80,292,677 $ 70,337,371

Borrowings and accrued interest $ 36,026,446 $ 5,912 $ 36,032,358 $ 1,816,481 $ 37,848,839 $ 32,023,669

Payable for swaps

Borrowings 24,867,815 (1,347,193) 23,520,622 1,347,193 24,867,815 16,936,964

Others 1,198,781 (361,357) 837,424 361,357 1,198,781 583,320

Payable under securities

repurchase arrangement 301,759 – 301,759 – 301,759 5,092,316

Accounts payable and other liabilities 1,057,481 – 1,057,481 – 1,057,481 722,402

Total Liabilities 63,452,282 (1,702,638) 61,749,644 3,525,031 65,274,675 55,358,671

Paid-in capital 3,777,071 – 3,777,071 – 3,777,071 3,842,293

Net notional maintenance of value

receivable (564,383) – (564,383) – (564,383) (661,197)

Ordinary reserve 9,532,487 1,194 9,533,681 877,280 10,410,961 9,642,454

Special reserve 209,723 – 209,723 – 209,723 202,847

Loan loss reserve 195,062 – 195,062 – 195,062 182,100

Surplus 894,594 – 894,594 – 894,594 616,300

Cumulative revaluation adjustments account (23,336) 23,336 – – – –

Net incomeb — 31 December 2008 1,119,473 (426,647) 692,826 (597,852) 94,974 –

Net incomeb — 31 December 2007 227,500c (227,500) – – – 1,153,903

Accumulated other comprehensive income (98,721) (74,710) (173,431) 173,431 – –

Total Equity 15,269,470 (704,327) 14,565,143 452,859 15,018,002 14,978,700

TOTAL $ 78,721,752 $ (2,406,965) $ 76,314,787 $ 3,977,890 $ 80,292,677 $ 70,337,371

( ) = negative, FAS = Financial Accounting Standards. a Includes reversal of unrealized (gains) losses attributed to equity investments accounted for under equity method. b Net income after appropriation of guarantee fees to Special Reserve. c Cumulative effect of FAS 157/159 adoption to prior years’ net income.

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cial statements under FAS 133. As of 31 December 2008,

ADB holds a relatively small portion of hybrid financial in-

struments in its borrowing portfolio.

FAS 159 expands the scope of financial assets and liabili-

ties that companies may carry at fair value. Effective 1 January

2008, ADB utilized this election to fair value all non-hybrid

borrowings that are swapped. As a result of this election, all

borrowings that are swapped and their related derivatives are

reported at fair value, with changes in fair value reported in

earnings. However, ADB still reports all of its loans and those

borrowings that are not swapped at amortized cost.

FAS 157 defines fair value, establishes a framework

for measuring fair value, and expands disclosure require-

ments about fair value measurements. In compliance with

this standard, and in conjunction with the FAS 159 elec-

tion above, ADB incorporated its credit risk (as a credit

spread) in fair valuing its liabilities. The combined effect

of the adoption of FAS 157 and 159 was to increase the

opening balance of retained income as at 1 January 2008

by $227.5 million.

In March 2008, the Financial Accounting Standards

Board (FASB) issued FAS 161 “Disclosures about Deriva-

tive Instruments and Hedging Activities—an amendment

of FASB Statement No. 133,” which requires enhanced

disclosures about an entity’s derivative and hedging ac-

tivities and thereby improve the transparency of financial

reporting. This statement is effective for financial state-

ments issued for fiscal years and interim periods begin-

ning after 15 November 2008.

Supplemental Reporting. Because of the asymmetry creat-

ed in the financial statements resulting from applying fair

value to the derivatives and swapped borrowings, while

loans are carried at amortized cost less provision, man-

agement believes that the reported income does not ap-

propriately capture the true economic income of ADB.

Therefore, ADB has decided to continue issuing two non-

US GAAP supplemental financial reports using current

value and pre-FAS 133/159 to better reflect its financial

position and risk management. Applications of consistent

approaches on these statements allow better analysis for

management information and decision making.

For current value reporting all financial instruments

are measured using a model based on the present value of

expected cash flow. The model utilizes market data to de-

termine the cash flow and discount rates for each instru-

ment. Under pre-FAS 133/159, loans, promissory notes,

swapped borrowings, and all derivative instruments are

reported at cost.

Discussion and Analysis on Current Value

Table 2 presents estimates of the economic value of OCR’s

financial assets and liabilities taking into consideration

changes in interest rates, exchange rates, and credit risks.

Current value reflects the exit price for financial instru-

ments with liquid markets and is the estimated fair value.

For financial instruments with no market quotations, cur-

rent value is estimated by discounting the expected cash

flows by applying the appropriate market data. The cur-

rent value results may differ from the actual net realizable

value in the event of liquidation. The reversal of the ef-

fects of FAS 133/159 removes its impact, as these effects

are part of current value adjustments (Tables 3 and 4).

Current Value Balance Sheet

Loans and Related Swaps. Most loans are made to or guaran-

teed by ADB members. ADB does not sell its loans believ-

ing that there is no market for them. The current value

of loans incorporates management’s best estimate of ex-

pected cash flows including interest. Estimated cash flows

from principal repayments and interest are discounted by

the applicable market yield curves for ADB’s funding cost

plus lending spread.

The current value also includes an appropriate credit

risk assessment. To recognize this inherent risk and oth-

er potential overdue payments, the loan value is adjusted

through loan loss provisioning. ADB has never suffered a loss

on sovereign loans except opportunity losses resulting from

the difference between payments for interest and charges

not in accordance with the loan’s contractual terms.

The positive adjustment of $1.5 billion indicates that

the average interest rates on loans on an after-swap basis are

higher than ADB would currently originate on similar loans.

Investments and Related Swaps. Under both the statutory

and current value bases, investment securities and relat-

ed derivatives are reported at fair values based on market

quotations when available. Otherwise, the current value is

calculated using market-based valuation models incorporat-

ing observable market data. The net negative adjustment of

$68.8 million resulted from unrealized losses on asset

swaps due to declining interest rates in related markets.

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TABLE 3: Condensed Current Value Income Statements for the Years Ended 31 December 2008 and 2007($ Thousand)

31 December 200831 December

2007

Statutory Basis

Reversal of FAS 133/159

Effectsa

Pre–FAS 133/159

BasisCurrent Value Adjustments

Current Value Basis

Current Value Basis

REVENUE

From loans $ 1,357,981 $ – $ 1,357,981 $ – $ 1,357,981 $ 1,442,338

From investments 677,175 – 677,175 – 677,175 683,212

From guarantees 6,876 – 6,876 – 6,876 5,049

From equity investments 3,737 24,055 27,792 (24,055) 3,737 58,897

From other sources - net 18,685 – 18,685 – 18,685 18,835

Total Revenue 2,064,454 24,055 2,088,509 (24,055) 2,064,454 2,208,331

EXPENSES

Borrowings and related expenses 1,208,391 – 1,208,391 – 1,208,391 1,389,778

Administrative expenses 141,047 – 141,047 – 141,047 127,327

Technical assistance to member countries 8,357 – 8,357 – 8,357 (683)

Provision for losses (3,467) – (3,467) 3,467 – –

Other expenses 6,272 – 6,272 – 6,272 3,998

Total Expenses 1,360,600 – 1,360,600 3,467 1,364,067 1,520,420

Net realized gains (28,096) – (28,096) – (28,096) 22,905

Net unrealized gains 450,591 (450,702)b (111) 24,055 23,944 14

Current value adjustmentsc – – – (597,852) (597,852) 447,543

Provision for losses – – – 3,467 3,467 579

NET INCOME $ 1,126,349 $ (426,647) $ 699,702 $ (597,852) $ 101,850 $ 1,158,952

( ) = negative, FAS = Financial Accounting Standards.a Includes reversal of unrealized (gains) losses attributed to equity investments accounted for under equity method.b FAS 133/159 adjustments are reversed as the current value adjustments incorporate the effect of net unrealized losses on derivatives and swapped borrowings under FAS 133 and FAS 159.c Current value adjustments include the effect of FAS 133/159 adjustments and the net unrealized losses on equity investments accounted for under equity method.

Equity Investments. Under both statutory and current value

bases, equity investments are reported at fair value when

market values are readily determinable; by applying equi-

ty method for investments in limited partnership and cer-

tain limited liability companies, or for investments where

ADB has the ability to exercise significant influence; or at

cost less permanent impairment, if any, which represents

a fair approximation of the current value.

Receivable from Members. This consists of promissory notes

that may be restricted by member countries. The current

value is based on the cash flow of the projected encash-

ment of the promissory notes discounted using appropri-

ate interest rates.

Borrowings after Swaps. The current value of these liabili-

ties includes the fair value of the borrowings and asso-

ciated financial derivative instruments, and is calculated

using market-based valuation models incorporating ob-

servable market data.

The $926.3 million unfavorable current value adjust-

ment is due to the fact that the average cost of the borrow-

ings on an after-swap basis is higher than the market rate

at which ADB can currently obtain new funding.

Current Value Income Statement

For 2008, the current value net income is $101.9 million

compared with pre-FAS 133/159 net income of $699.7 mil-

lion and statutory reported net income of $1,126.3 mil-

lion (Table 3).

Current Value Adjustments. The total current value adjust-

ment of $597.9 million ($447.5 million in 2007) represents

the change in the current value of all ADB financial instru-

ments during the year. The adjustment reflects changes

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in interest rates, currency exchange rates, and credit risks.

This comprised a net unfavorable adjustment of $257.6

million from the change in the valuation of all outstand-

ing financial instruments, $107.6 million from translation

adjustments, and $259.8 million adjustment in pension

and postretirement benefit liability, offset by $27.2 mil-

lion net unrealized gains on investments ($251.3 million

gain for investments; $224.1 million loss for equity invest-

ments) (Table 4).

Impact of Changes in Interest Rates. The net decrease in

the current value adjustments on the balance sheet dur-

ing 2008 was $257.6 million. It was a result of the increase

in unrealized losses in the borrowing portfolio of $831.1

million, unfavorable results for investments of $89.5 mil-

lion and equity investments of $24.1 million, offset by in-

crease in unrealized gains for loans of $668.1 million, and

decrease in unrealized losses on other assets of $19.0 mil-

lion.

Impact of Changes in Exchange Rates. Translation adjust-

ments, reported under the statutory basis as part of “accu-

mulated other comprehensive income”, are presented as

current value adjustments. The general strengthening of

the US dollar against most of the major currencies in 2008

resulted in a negative translation adjustment of $107.6

million compared to a favorable adjustment of $126.8 mil-

lion in 2007.

Operating Activities

In pursuing its objectives, ADB provides financial assis-

tance through loans, technical assistance, guarantees, and

equity investments to its developing member countries

to help them meet their development needs. This as-

sistance can be provided to sovereign and nonsovereign

entities. ADB also actively promotes cofinancing of its de-

velopment projects and programs to complement its own

assistance with funds from both official and commercial

sources including export credit agencies.

Loans. Until 30 June 2001, ADB’s three windows for loans

from OCR were the pool-based multicurrency loan, the

pool-based single-currency loan in US dollars, and the

market-based loan. With the introduction of the LIBOR-

based loan on 1 July 2001, the pool-based multicurrency

loan and market-based loan are no longer offered, and on 1

July 2002, the pool-based single-currency loan in US dol-

lars was retired. Effective January 2004, the pool-based

multi currency loans were transformed into pool-based

single currency loans in Japanese yen. The LIBOR-based

loan is a timely response to borrowers’ demand for loan

products that suit project needs and effectively manage

their external debt. LIBOR-based loan products give bor-

rowers a high degree of flexibility in managing interest

rate and exchange rate risks and at the same time provide

low intermediation risk to ADB. Since November 2002,

TABLE 4: Summary of Current Value Adjustments($ Thousand)

Balance Sheet Effects as of 31 December 2008Income Statement Effects

Year to Date

Loans After Swaps Investmentsa

Borrowings After

SwapsOther

Assetsb

Less Prior Year

Effectsc31 December

200831 December

2007

Total Current Value Adjustments on Balance Sheet $ 1,492,746 $ (62,752) $ (926,345) $ (50,790) $ (710,483) $ (257,624) $ 148,078

Unrealized Gains on Investmentsd 27,224e 232,792

Accumulated Translation Adjustments (107,617)f 126,844

Pension and Post Retirement Benefit Liability Adjustments (259,835) (60,171)

Total Current Value Adjustments $ (597,852) $ 447,543

( ) = negative, FAS = Financial Accounting Standards.a Relates to investments related swaps and equity investments under equity method.b Relates to receivable from members.c Prior Year Effects include cumulative current value adjustments on all financial instruments and equity investments accounted for under equity method, made in the prior years.d Relates to unrealized gains on investments and equity investments classified as available for sale.e Included in Other Comprehensive Income under statutory basis.f Relates to the translation adjustments for the period and current translation effects from FAS 133/159 reversals.

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ADB has been offering local currency loans to nonsover-

eign borrowers and expanded this to sovereign borrowers

in August 2005.

Loan Approvals, Disbursements, Repayments, and Prepay-ments. In 2008, the Board of Directors approved 46 sover-

eign loans totaling $6.9 billion, and 15 nonsovereign loans

totaling $1.8 billion, compared with 2007 approvals of 38

sovereign loans totaling $7.3 billion and 22 nonsovereign

loans totaling $0.9 billion. Disbursements in 2008 totaled

$6.5 billion ($5.9 billion for sovereign loans and $0.6 bil-

lion for nonsovereign loans) representing an increase of

25% from the $5.2 billion disbursements in 2007. Regular

principal repayments for the year were $1.6 billion ($1.4

billion in 2007) while prepayments amounted to $0.3 bil-

lion ($0.1 billion in 2007). In 2008, eight loans were fully

prepaid. As of 31 December 2008, the total loans out-

standing after provision for losses and net unamortized

loan origination cost amounted to $35.9 billion, of which

$34.2 billion is for sovereign loans and $1.7 billion is for

nonsovereign loans.

In 2005, ADB established the multitranche financing

facility, a debt financing facility that allows ADB to deliver

financial resources for a specific program or investment in

a series of separate financing tranches over a fixed period.

Financing tranches may be provided as loans, guarantees,

equity or any combination of these instruments based on

periodic financing requests submitted by the borrower.

In 2008, six multitranche financing facilities totaling $4.3

billion (seven multitranche financing facilities totaling

$4.0 billion in 2007), were approved under OCR. Periodic

financing requests under multitranche financing facilities

amounting to $1.8 billion were approved in 2008 ($2.0 bil-

lion in 2007).

Starting September 2005, ADB provided lending

without sovereign guarantee to entities that can be consid-

ered public sector borrowers but are structurally separate

from the sovereign or central government. Such entities

include state-owned enterprises, government agencies,

municipalities, and local government units. In 2008, two

loans to state-owned enterprises without sovereign guar-

antee totaling $300 million were approved (one loan for

$10 million in 2007).

Status of Loans. One nonsovereign loan with an outstand-

ing principal balance of $1.7 million (four loans totaling

$16.5 million in 2007) was in non-accrual status as of 31

December 2008. The $14.8 million decline is mainly at-

tributed to the sale or restructuring of three loans, which

were in nonaccrual status.

One sovereign loan was restored to accrual status in

May 2008, following full settlement of overdue principal

and interest.

Loan Charges on Sovereign Loans. LIBOR-based loans carry

a floating lending rate that consists of 6-month LIBOR

and an effective contractual spread fixed over the life of

the loan. The lending rate is reset every 6 months on each

interest reset date and can be converted to fixed rate at

borrower’s request. The lending rates for pool-based sin-

gle-currency loans are based on the previous semester’s av-

erage cost of borrowings. Interest rates for market-based

loans are either fixed or floating. The floating rates are

determined based on 6-month LIBOR with reset dates of

either 15 March and 15 September or 15 June and 15 De-

cember. Effective 2000, all sovereign loans without spe-

cific provisions in the loan agreements were charged with

lending spread of 60 basis points over the base lending

rate. In 2004, 20 basis points of the lending spread were

waived on sovereign loans outstanding from 1 July 2004 to

30 June 2005 for borrowers that did not have loans in ar-

rears. Subsequently, the policy was extended to cover the

period up to June 2009. In December 2007, the Board of

Directors revised the lending rates for all sovereign LI-

BOR-based loans negotiated on or after 1 October 2007

by reducing the effective contractual spread to 20 basis

points over the base lending rate and eliminating the waiv-

er mechanism for such loans.

ADB’s variable lending rates for pool-based single-

currency loans in US dollars and in Japanese yen are shown

below.

Table 5: Lending Ratesa

(% per annum)

2008 2007 PSCLs

1 January 1.90 1.31 Japanese yen 6.12 5.91 US dollar

1 July 1.98 1.69 Japanese yen 5.64 6.34 US dollar

PSCL = Pool-based single-currency loan.a Lending rates are set on 1 January and 1 July every year and are valid for 6 months and

are represented net of 20 basis points lending spread waiver.

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ADB also charges a front-end fee of 1% on sovereign

loans to cover the administrative costs incurred in loan

origination. In 2004, the Board of Governors approved

the waiver of the entire front-end fee on all new sover-

eign loans approved from 1 January 2004 to 30 June 2005.

Subsequently, the policy was extended to cover the pe-

riod up to June 2009. In December 2007, the Board of

Directors approved the elimination of front-end fees for

sovereign LIBOR-based loans negotiated on or after 1

October 2007.

ADB applied a progressive commitment fee of 75 ba-

sis points on undisbursed loan balances for sovereign proj-

ect loans and a flat commitment fee of 75 basis points for

sovereign program loans. In October 2006, as part of the

enhancement of ADB’s loan and debt management prod-

ucts, all sovereign project loans negotiated after 1 Janu-

ary 2007 carried a flat commitment fee of 35 basis points

on the full amount of undisbursed loan balances. In April

2007, the Board also approved the waiver of 10 basis points

of the commitment charge on the undisbursed balances

of sovereign project loans negotiated after 1 January 2007

and 50 basis points of the commitment charge on the un-

disbursed balances of sovereign program loans. The waiver

is applicable to all interest periods starting from 1 Janu-

ary 2007 up to and including 30 June 2009. In December

2007, the Board of Directors approved the reduction of

the commitment charge from 75 basis points for sover-

eign program loans and 35 basis points for sovereign proj-

ect loans to 15 basis points for both sovereign program and

project loans negotiated on or after 1 October 2007, and

eliminated the waiver mechanism for such loans.

Rebates and surcharges are standard features of sov-

ereign LIBOR-based loans. To maintain the principle of

cost pass-through pricing, ADB returns the actual sub-LI-

BOR funding cost margin to its LIBOR-based loans sov-

ereign borrowers through rebates. A surcharge could arise

if ADB’s funding cost exceeds the 6-month LIBOR. Re-

bate or surcharge rates are set on 1 January and 1 July ev-

ery year and are based on the actual average funding cost

margin for the preceding 6 months. Effective 1 July 2007,

rebates or surcharges are passed on to the borrowers by in-

corporating them into the interest rate for the succeeding

interest period, rather than retroactively. Based on rebate

rates, ADB returned an actual sub-LIBOR funding cost

margin of $81.1 million to its LIBOR-based loan sovereign

borrowers in 2008 ($38.1 million in 2007).

Loan Charges on Nonsovereign Loans. For nonsovereign

loans, the lending spread is determined based on mar-

ket practices, which is intended to cover ADB’s risk expo-

sure to specific borrowers and projects. ADB also charges a

market-based front-end fee on nonsovereign loans to cov-

er the administrative costs incurred in loan origination.

Front-end fees are typically in the range of 1% to 1.5% de-

pending on the transaction. Based on the LIBOR-based

lending policy, ADB applies a commitment fee typically

in the range of 0.50% to 0.75% per annum on the undis-

bursed commitment.

Local currency loans are priced based on relevant lo-

cal funding benchmarks or ADB’s funding costs and a risk-

based spread.

Official Cofinancing for Loans. In 2008, $837.6 million from

official sources was mobilized in loan cofinancing with par-

tial administration by ADB for four loan projects totaling

$752.4 million.

Technical Assistance. From 1967 to 1991, technical assis-

tance expenses were charged to OCR and other technical

assistance funding resources—the Technical Assistance

Special Fund (TASF), the Japan Special Fund, and trust

or grant funds. From 1992 to 2000, no technical assistance

expenses were charged to OCR. In 2001, the Board of Di-

rectors approved the financing of high-priority technical

assistance programs out of OCR current income within

a rolling 4-year financing framework. The amount of fi-

nancing required varies between years and is subject to

the approval of the Board of Directors. In 2003, the Board

reverted to the practice of allocating OCR net income to

the TASF and of financing technical assistance activities

through it and other various funding resources. On an ex-

ceptional basis, ADB committed $10.0 million from OCR

net income as contribution to the Java Reconstruction

Fund in November 2008, for the Yogyakarta and Central

Java reconstruction. This was treated as a technical assis-

tance grant in 2008.

Table 6: Rebate Rates(% per annum)

US dollar Japanese yen

1 January 2008 0.34 0.31

1 July 2008 0.33 0.39

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Guarantees. ADB provides guarantees1 as credit enhance-

ments for eligible projects to cover risks that the project and

its commercial cofinancing partners cannot easily absorb

or manage on its own. Reducing these risks can make a sig-

nificant difference in mobilizing debt funding for projects.

ADB has used its guarantee instruments successfully for in-

frastructure projects, financial institutions, capital markets,

and trade finance. These instruments generally are not rec-

ognized in the balance sheet and have off-balance sheet risks.

For guarantees issued and modified after 31 December 2002

in accordance with Financial Accounting Standards Board In-

terpretation No. 45 (FIN 45), “Guarantor’s Accounting and

Disclosure Requirements for Guarantees, Including Indirect

Guarantees of Indebtedness to Others,” ADB recognized at

the inception of a guarantee the noncontingent aspect of

its obligations. ADB’s total exposure on signed and effec-

tive loan guarantees is disclosed in Note F of OCR Financial

Statements. In 2008, ADB provided $10.0 million for one po-

litical risk guarantee operation.

Syndications. Syndications enable ADB to mobilize cofi-

nancing by transferring some or all of the risks associated

with its loans and guarantees to other financing partners2.

Syndications thus decrease and diversify the risk profile of

ADB’s financing portfolio. Syndications may be on a fund-

ed or unfunded basis and may be arranged on an individ-

ual, portfolio, or any other basis consistent with industry

practices. In 2008, $565.0 million for syndications through

B-loans3 was provided for three projects.

Equity Investments. In accordance with ADB’s Charter

which mandates that its nonsovereign operations pro-

mote the investment of private capital in the region for

development, ADB provides assistance in the form of eq-

uity investments, in addition to loans without government

guarantees, and other financing schemes. The Charter al-

lows the use of OCR for equity investments in private

enterprises up to 10% of its unimpaired paid-in capital

together with reserves and surplus, exclusive of special

reserves. The total equity investment portfolio for OCR

for both outstanding and undisbursed approved facilities

amounted to $911.14 million at end 2008. This represent-

ed about 61% of the ceiling defined by the Charter.

As of 31 December 2008, the total exposure of non-

sovereign operations in equity investments amounted to

about $815.0 million.

In 2008, seven equity investments totaling $123.1

million were approved compared with five equity invest-

ments totaling $79.8 million in 2007. In the same year,

ADB disbursed a total of $125.7 million in equity invest-

ments, 8.7% increase from $115.6 million disbursed in

2007, and received a total amount of $53.6 million from

capital distributions and divestments, whether in full or

in part, in 20 projects. The divestments were carried out

in a manner consistent with good business practices, af-

ter ADB’s development role in its investments have been

fulfilled, and without destabilizing the companies con-

cerned.

Capital and Resources

Capital. Total shareholders’ equity on a statutory basis

increased from $14.3 billion as of 31 December 2007 to

$15.3 billion as of 31 December 2008. This was due pri-

marily to net income for the year of $1.1 billion; the favor-

able effect of FAS 157/159 adoption to prior years’ income

amounting to $227.5 million; the net effect of change in

special drawing rights value on capital and reserves of

$33.1 million; and additional capital subscription received

of $7.4 million. These were offset by net decrease in other

comprehensive income of $276.7 million (adjustment to

pension and post retirement benefit obligation of $259.8

million, unfavorable translation adjustments of $43.4 mil-

lion; and amortization of FAS 133 adjustment of $0.7 mil-

lion; offset by unrealized gain on investments and equity

investments of $27.2 million); and allocations to the Asian

Development Fund and Climate Change Fund of $40.0

million each, and to the Technical Assistance Special

Fund of $23.0 million.

The total authorized and subscribed capital of ADB

is 3,546,311 shares valued at $54,890.2 million as of 31

December 2008. Of the subscribed capital, $3,860.6 mil-

1 ADB offers two types of guarantee products—political risk and partial credit—designed to facilitate cofinancing by mitigating risk exposure of commercial lenders and capital market investors. A political risk guarantee covers against specifically defined political risks. A partial credit guarantee provides comprehensive cover (of commercial and political risks) for a specific portion of the debt service provided by cofinanciers. These guarantees are issued for projects in which ADB satisfies its participation requirement.

2 Depending on whether ADB retains risk or not, there may or may not be a contingent liability to ADB.3 A B-loan is a tranche of a direct loan nominally advanced by ADB, subject to eligible financial institutions’ taking funded risk participations within such a tranche and without

recourse to ADB. It complements an A-loan funded by ADB.4 Excluding ADB’s share on net unrealized gains of investee companies accounted under equity method totaling $6.1 million.

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lion was paid-in and $51,029.6 million was callable. Callable

capital can be called only if required to meet ADB’s obliga-

tions incurred on borrowings or guarantees under OCR. No

call has ever been made on ADB’s callable capital.

To ensure it has adequate risk-bearing capacity, ADB

reviews its income outlook annually. Based on that review,

the Board of Directors allocates a portion of the previous

year’s net income to reserves to ensure that the level is

commensurate with the income planning framework. In

addition, to the extent feasible, it allocates part of the

net income to support development activities in its de-

veloping member countries. In May 2008, the Board of

Governors approved the allocation of 2007 net income of

$760.2 million to the cumulative revaluation adjustments

account for $87.6 million, to loan loss reserve for $13.0 mil-

lion, to surplus and ordinary reserves for $278.3 million

each, to Asian Development Fund and Climate Change

Fund for $40.0 million each, and to Technical Assistance

Special Fund for $23.0 million.

In December 2008, the Board of Directors approved

the revised policy on ADB’s lending limitation, which limits

the total amount of disbursed loans, approved equity invest-

ments, and the maximum amount that could be demanded

from ADB under its guarantee portfolio, to the total amount

of ADB’s unimpaired subscribed capital, reserves, and sur-

plus. In addition, the gross outstanding borrowings shall not

exceed the sum of callable capital from nonborrowing mem-

bers, paid-in capital, and reserves (including surplus). As of

31 December 2008, headroom for lending was $29.2 billion

and for borrowings, $8.9 billion, based on the new policy

(compared with $35.5 billion for lending and $16.4 billion

for borrowings as of 31 December 20075).

On 6 May, the Board of Directors reported to the

Board of Governors on the status of ADB’s resources and

highlighted the need to initiate a study on financial re-

sources. Accordingly, ADB prepared a working paper

that provided the required analysis and context to assess

ADB’s financial resource position during the implemen-

tation period of Strategy 2020, and reviewed all possible

avenues for resource mobilization.

The working paper was discussed by the Board of Di-

rectors on 6 October. The Directors noted that, while the

technical issues were well presented in the working paper,

the developmental and political issues are equally impor-

tant to address in the context of the general capital in-

crease and therefore requested the preparation of a second

working paper. The second working paper was discussed

by the Board of Directors in February 2009. Management

is currently reviewing and preparing a proposal on the fifth

general capital increase for ADB, which is scheduled for

board of directors’ discussion in April 2009.

Borrowings. ADB’s primary borrowing objective is to en-

sure availability of funds at the most stable and lowest

possible cost for its operations. Subject to this objective,

ADB seeks to diversify its funding sources across mar-

kets, instruments, and maturities. To achieve the objec-

tive, ADB continued in 2008 a strategy of issuing liquid

benchmark bonds to maintain its strong presence in key

currency bond markets, and raising funds through op-

portunistic financing and private placements, such as

retail-targeted transactions and structured notes, which

provide ADB with cost-efficient funding levels. All pro-

ceeds from new funding transactions are invested until

they are required for ADB’s ordinary operations, includ-

ing loan disbursements and refinancing of maturing

funding obligations.

2008 Funding Operations. During 2008, ADB completed

113 borrowing transactions raising about $9.4 billion in

long- and medium-term funds compared with $8.9 billion

in 2007. The new borrowings were raised in seven curren-

cies: Australian dollar, Japanese yen, New Zealand dollar,

Pound sterling, South African rand, Turkish lira, and US

dollar. After swaps, $9.2 billion or 97.6% of the 2008 bor-

rowings were in US dollar, and the remaining $0.2 billion

or 2.4% were in Japanese yen. The average maturity of

2008 borrowings was 3.5 years compared with 5.2 years in

2007. Of the total 2008 borrowings, $4.8 billion was raised

through 11 public offerings, and 102 private placements

amounting to $4.6 billion. In addition, ADB raised $2.9

billion in short-term funds under its Euro commercial pa-

per program to enhance its presence in the market and to

meet temporary cash needs. Table 7 shows details of 2008

borrowings compared with borrowings in 2007.

Local Currency Bond Issues. ADB continued to pursue its

objective of contributing to the development of region-

5 Recalculated based on the new policy.

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Currency Composition of Outstanding Borrowings (Before Swaps)

Japanese Yen10.2%

Other Currenciesa

42.7%

U.S. Dollar47.1%

al bond markets. Although this year’s market conditions

have not been favorable for ADB to issue local currency

bonds, ADB raised about $200 million equivalent through

cross-currency swaps to meet local currency funding re-

quirements in Indian rupee, Indonesian rupiah, and Phil-

ippine peso.

Use of Derivatives. ADB undertakes currency and inter-

est rate swaps to raise, on a fully hedged basis, curren-

cies needed for operations in a cost efficient way while

maintaining its borrowing presence in major capital mar-

kets. Figures 1 and 2 show the effects of swaps on the in-

terest rate structure and currency composition of ADB’s

outstanding borrowings as of 31 December 2008. Interest

rate swaps are also used for asset and liability management

a Other currencies include Australian dollar, Canadian dollar, Chinese yuan, Euro, Hong Kong dollar, Indian rupee, Kazakhstan tenge, Malaysian ringgit, Mexican peso, New Taiwan dollar, New Zealand dollar, Philippine peso, Pound sterling, Singapore dollar, South African rand, Swiss franc, Thai baht, and Turkish lira.

b Other currencies include Chinese yuan, Indian rupee, Kazakhstan tenge, Philippine peso, Pound sterling, and Swiss franc.

Figure 1: Effect on Currency Composition

Currency Composition of Outstanding Borrowings (After Swaps)

Other Currenciesb

1.8%

Japanese Yen13.1%

U.S. Dollar85.1%

Interest Rate Structure of Outstanding Borrowings (Before Swaps)

Variable6.6%

Fixed93.4%

Interest Rate Structure of Outstanding Borrowings (After Swaps)

Fixed14.5%

Variable85.5%

Figure 2: Effect on Interest Rate Structures

Table 7: Borrowings(Amounts in $ Million)

2008 2007

Long Term Total Principal Amount 9,372.1 8,854.3 Average Maturity to First Call (years) 3.5 5.2 Average Final Maturity (years) 4.4 9.4 Number of Transactions Public Offerings 11 10 Private Placements 102 84 Number of Currencies (before swaps) Public Offerings 4 8 Private Placements 6 9

Short Terma Total Principal Amountb 2,866.6 3,139.1 Number of Transactions 21 24 Number of Currencies 2 3

a All euro-commercial papers. b At year-end, the outstanding principal amount was nil in 2008 and 2007.

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purposes to match the liabilities to the interest rate char-

acteristics of loans.

Liquidity Portfolio

The liquidity portfolio helps ensure the uninterrupted

availability of funds to meet loan disbursements, debt ser-

vicing, and other cash requirements. It also contributes to

ADB’s earning base. ADB’s Investment Authority governs

liquid asset investments. Its primary objective is to main-

tain the security and liquidity of funds invested. Subject

to these two parameters, ADB seeks to maximize the total

return on its investments. In compliance with its Charter,

ADB does not convert currencies for investment; invest-

ments are made in the same currencies in which they are

received. At present, liquid investments are held in 21

currencies.

Liquid assets are held in government and govern-

ment-related debt instruments, time deposits, and other

unconditional obligations of banks and financial institu-

tions, and, to a limited extent, in corporate bonds, mort-

gage-backed securities, and asset-backed securities of

high credit quality. They are held in four subportfoli-

os—prudential liquidity, operational cash, cash cushion,

and discretionary liquidity—all of which have different

risk profiles and performance benchmarks. The year-

end balance of the portfolios in 2008 and 2007, includ-

ing receivables for securities repurchased under resale

arrangements, and excluding securities transferred under

securities lending arrangements and pending sales and

purchases, is presented in Table 8.

The prudential liquidity portfolio is invested to en-

sure that the primary objective of a liquidity buffer is met.

Cash inflows and outflows are minimized to maximize the

total return relative to a defined level of risk. The portfolio

is funded largely by equity, and performance is measured

against external benchmarks with an average duration of

about 2.3 years. ADB revised the liquidity policy in Octo-

ber 2006 to bring up to date its financial and risk manage-

ment policies and practices in line with ADB’s business

activities and initiatives and to harmonize its liquidity pol-

icy with other multilateral development banks. Under the

new policy, the duration for the prudential liquidity port-

folio can be extended up to 4 years for the portfolio funded

by equity. The remaining part of the prudential liquidity

portfolio is funded by debt and is invested to maximize the

spread earned between borrowing cost and investment in-

come on high-quality investments.

The operational cash portfolio is designed to meet net

cash requirements over a 1-month horizon. It is funded by

equity and invested in short-term, highly liquid money

market instruments. The portfolio performance is mea-

sured against short-term external benchmarks.

The cash cushion portfolio holds the proceeds of

ADB’s borrowing transactions pending disbursement. It is

invested in short-term instruments, and the performance

is measured against short-term external benchmarks.

The discretionary liquidity portfolio is used to sup-

port medium-term funding needs and is funded by debt

to provide flexibility in executing the funding program

over the medium-term to permit borrowing ahead of cash

flow needs and bolster ADB’s access to short-term funding

through continuous presence in the market.

Table 8: Year-End Balance of Liquidity Portfolioa

($ Million)

2008 2007

Prudential Liquidity Portfolio 9,604.5 9,209.3Operational Cash Portfolio 298.2 395.1Cash Cushion Portfolio 2,605.9 778.8Discretionary Liquidity Portfolio 2,622.0 2,550.5Other Portfolio 626.1 645.7

TOTAL 15,756.7 13,579.4

a The composition of liquidity portfolio may shift from 1 year to another as part of ongoing liquidity management.

Table 9: Return on Liquidity Portfolio(%)

Annualized Financial Return

2008 2007

Prudential Liquidity Portfolio 6.43 5.84Operational Cash Portfolio 2.03 3.95Cash Cushion Portfolio 2.59 4.67Discretionary Liquidity Portfolioa 0.44 0.28Other Portfolio 2.83 3.64

a Spread over funding cost at 31 December.

Table 10: Contractual Cash Obligations($ Million)

2008 2007

Long-Term Debt 35,713.5 32,187.2Undisbursed Loan Commitments 20,648.5 19,011.3Undisbursed Equity Investment Commitments 275.7 344.0Guarantee Commitments 1,772.6 1,460.6Other Long-Term Liabilities 712.7 450.6

TOTAL 59,123.0 53,453.7

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Table 11: Sovereign Borrower ConcentrationAs of 31 December 2008 and 2007 (%)

Country 2008 2007

Indonesia 29 31China, People’s Republic of 24 25India 18 16Pakistan 13 9Philippines 11 13Others 6 6

Note: Figures may not add up to 100 due to rounding.

Contractual Obligations

In the normal course of business, ADB enters into various

contractual obligations that may require future cash pay-

ments. Table 10 summarizes ADB’s significant contrac-

tual cash obligations at 31 December 2008 and 2007.

Long-term debt includes direct medium- and long-term

borrowings excluding swaps but does not include any ad-

justment for unamortized premiums, discounts, or effects

of applying FAS 133/159. Other long-term liabilities cor-

respond to accrued liabilities, including pension and post-

retirement medical benefits.

Financial Risk Management

In its development banking operations, ADB faces various

risks including credit, market, liquidity, and operational.

Among these risks, sovereign credit risk is the principal

risk as loans to developing member countries represent

91% of ADB’s operations portfolio with the remaining 9%

invested in nonsovereign entities. ADB takes a conserva-

tive approach to managing market and liquidity risks. To

ensure strong risk-bearing capacity, the institution main-

tains conservative capital adequacy.

The Risk Management Unit independently identi-

fies, measures, monitors, and manages these risks in ac-

cordance with industry best practice. The unit is under

the Office of the President and reports to the managing

director general. The Risk Committee, chaired by the

managing director general, provides senior management

oversight of the risk management function and makes rec-

ommendations on risk policies and actions.

Credit Risk

ADB principally faces three forms of credit risk: sovereign,

nonsovereign, and counterparty and issuer.

Sovereign. Sovereign credit risk is the risk that a sovereign

borrower may default on its loan or guarantee obligations.

ADB relies on monitoring, loan loss reserves, and conser-

vative capital adequacy to manage sovereign credit risk.

ADB uses a 10-category rating scale to evaluate its

sovereign borrowers. During 2008, the weighted average

risk rating increased from 4.83 to 4.85, which indicates

slightly weakening credit quality. Because some of the low

risk borrowers were upgraded in 2008, the small change in

the weighted average risk rating understates the impact

of the financial crisis and subsequent economic slowdown

to some sovereign borrowers.

Concentration risk, which occurs when a small group

of borrowers account for a large share of the portfolio, is

a key concern for ADB. During 2008, ADB’s exposure to

its three largest sovereign borrowers was essentially con-

stant at 71%.

ADB holds provisions to offset known or probable

losses in specific transactions and loan loss reserves to off-

set the average losses that ADB would expect to incur in

the course of its lending operations. The sum of provisions

and the loan loss reserve represents ADB’s expected loss.

Following the decline in credit quality, the expected loss

for the sovereign portfolio approximately doubled in 2008.

Nonsovereign. Nonsovereign credit risk is the risk that a

nonsovereign entity, such as a private-sector firm, state-

owned enterprise or local government, may default on its

loan or guarantee obligations. These transactions lack the

backing of a national government.

Management of nonsovereign credit risk begins during

the earliest stages of each proposed transaction. In addi-

tion to evaluating the development impact, ADB consid-

ers a proposal’s credit strength, corporate management and

governance, and financial, commercial, and technical via-

Table 12: Sovereign Portfolio Expected LossAs of 31 December 2008 and 2007

2008 2007 $ Million % $ Million %

Provision for loan losses 4.4 0.0 5.7 0.0Loan loss reserve requirementa 423.7 1.0 166.7 0.6Expected Loss 428.0 1.0 172.4 0.6

a The loan loss reserve requirement is subject to Board of Governors’ approval during the annual meeting in May 2009.

Note: 0.0 is less than 0.05%.

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bility. Not only do the business units undertake this due

diligence, but the Risk Management Unit also conducts an

independent assessment of each proposed transaction.

Currently, ADB uses a 7-scale rating system to eval-

uate its nonsovereign borrowers. During 2008, average

credit quality worsened, and the weighted average credit

rating increased from 3.5 to 3.7. The deteriorating macro-

economic conditions in some developing member coun-

tries led to the downgrade of firms operating in these

environments.

ADB uses a variety of limits to manage concentration

risk in the nonsovereign portfolio. The total assistance to

a single project must not exceed 25% of the total project

cost or $250.0 million, whichever is lower. This limit en-

sures that exposure to a single project or obligor does not

exceed 5% of the Board-approved ceiling of $5.0 billion for

nonsovereign operations. Furthermore, there are nonsov-

ereign exposure limits for corporate groups, industry sub-

sectors, and countries.

ADB must closely monitor country and sector con-

centrations in the nonsovereign portfolio particularly

due to the nature of its development mandate. Although

country concentration is still significant, it decreased in

2008 with the three largest country exposures falling

from 49% to 42% of the portfolio. Sector concentration

was more or less constant. ADB has focused on the en-

ergy and finance sectors for their development signifi-

cance, and they continued to represent over 75% of the

portfolio in 2008.

In addition to due diligence and limits, ADB monitors

its portfolio to identify any deterioration of credit quality

and uses loan loss reserves and loan provisions to offset ex-

pected losses. During 2008, expected losses increased due

to weakening credit quality.

Table 13: Nonsovereign Country ConcentrationAs of 31 December 2008 and 2007 (%)

Country 2008 Country 2007

India 20 China, People’s Republic of 20China, People’s Republic of 14 India 17Kazakhstan 8 Kazakhstan 12Pakistan 7 Bangladesh 8Philippines 7 Viet Nam 5Others 43 Others 38


Table 14: Nonsovereign Sector ConcentrationAs of 31 December 2008 and 2007 (%)

Sector 2008 2007

Energy 44 36Finance 31 36Investment funds 12 17Transport and Communications 6 5Industry and Trade 5 4Others 2 1


Table 16: Issuer and Counterparty Exposureby Credit RatingAs of 31 December 2008 and 2007 (%)

2008 2007

AAA, AAA- 65 42AA+, AA, AA- 27 52A+, A, A- 7 6Below A- 1 0

Note: 0 is less than 0.5%.

Table 15: Nonsovereign Portfolio Expected LossAs of 31 December 2008 and 2007

2008 2007

$ Million % $ Million %

Provision for loan losses 4.8 0.2 9.4 0.3 Loan loss reserve requirementa 69.5 2.7 28.4 1.0Expected Loss 74.4 2.8 37.7 1.4

a The loan loss reserve requirement is subject to Board of Governors’ approval during the annual meeting in May 2009.

Issuer and Counterparty. Issuer risk is the risk that a bond

issuer may default on its interest or principal payments; it

applies to both investments which ADB internally man-

ages and those investments for which it retains external

asset managers. Counterparty risk is the risk that a coun-

terparty may fail to meet its contractual obligations to

ADB. Issuer and counterparty risks principally affect the

Treasury portfolio.

To control issuer and counterparty credit risk, ADB on-

ly transacts with financially sound institutions with ratings

from at least two reputable public rating agencies. At the

end of 2008, 92% of the Treasury portfolio was rated at least

AA- with a higher proportion invested in AAA institutions

than in 2007, as ADB sought to mitigate its exposure to

counterparties vulnerable to the financial crisis. Moreover,

the Treasury portfolio is generally invested in conservative

assets, such as money market instruments and government

securities. During 2008, the former decreased and the lat-

ter increased as ADB sought lower-risk instruments due to

the financial crisis. In addition, ADB has established con-

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servative exposure limits for its corporate investments, de-

pository relationships, and other asset classes.

ADB has not been materially impacted by the collapse

in credit quality of US mortgage-backed securities. ADB’s

exposure to these instruments is small, and any losses have

been offset by gains in ADB’s higher quality investments,

whose values have increased as investors have moved to saf-

er assets.

To mitigate counterparty credit risk arising through

derivative transactions, ADB has strict counterparty eligi-

bility criteria. In general, ADB will only undertake swap

transactions with counterparties that have met the re-

quired minimum counterparty credit rating, executed an

International Swaps and Derivatives Association Master

Agreement, and signed a credit support annex. Under the

credit support annex, derivative positions are marked-to-

market daily and collateral calls, mainly cash and US Trea-

sury securities, are made in accordance with the credit

support annex. ADB also sets exposure limits for individ-

ual swap counterparties and monitors these limits against

both current and potential exposures.

Market Risks

Market risk is the risk of loss on financial instruments due

to changes in market prices. ADB principally faces three

forms of market risk: interest rate, foreign exchange, and

equity price.

Interest Rate. ADB is primarily exposed to interest rate risk

through the Treasury portfolio. Interest rate risk in the

operations portfolio is fully hedged as borrowers’ inter-

est payments are matched to ADB’s borrowing expenses.

Therefore, the borrower assumes the risk of fluctuating

interest rates whereas ADB’s margin remains largely con-

stant. ADB monitors and manages interest rate risks in

the Treasury portfolio by employing various quantitative

methods. It marks all positions to market, monitors inter-

est rate risk metrics, and employs stress testing and sce-

nario analysis.

ADB principally uses two metrics to measure interest

rate risk, duration and interest rate value-at-risk (VaR). Du-

ration is the estimated percentage change in the portfolio’s

value in response to a 1% parallel change in interest rates.

During 2008, interest rate risk as measured by duration re-

mained essentially constant. Although the portfolio’s asset

composition shifted from deposits to government securi-

ties the aggregate maturity of the assets did not materially

change. Interest rate VaR is a measure of possible loss at a

given confidence level in a given timeframe due to changes in

interest rates. ADB uses a 95% confidence level and a 1-year

time horizon. In other words, ADB would expect to lose at

least this amount once every 20 years due to fluctuations in

interest rates. Unlike duration, which ADB uses to measure

interest rate risk across the Treasury portfolio, ADB only uses

VaR for the Prudential Liquidity Portfolio, which is the most

exposed to interest rate risk. In 2008, interest rate risk in the

Prudential Liquidity Portfolio increased primarily due to the

increase in interest rate volatility.

Foreign Exchange. In line with the Charter, ADB ensures

that its operations assume a minimum exposure to ex-

change rate risk. In both the operations and Treasury port-

folios, ADB is required to match its loans and investments

to the same currencies in which funds are received. Bor-

rowed funds or funds to be invested may only be converted

into other currencies provided that they are fully hedged

through cross currency swaps or forward exchange agree-

ments. Given its multicurrency operations, however, ADB

is exposed to fluctuations in reported US dollar results

due to currency translation adjustments.

Equity Price. Equity price risk arises through ADB’s invest-

ments in equity securities and private equity funds. ADB’s

Table 18: Interest Rate RiskAs of 31 December 2008 and 2007 (%)

2008 2007

Duration 1.6 1.5Interest Rate VaR 4.9 3.5

VaR = value-at-risk.

Table 17: Issuer and Counterparty Exposure by Asset ClassAs of 31 December 2008 and 2007 (%)

2008 2007

Government Securities 45 27Government Sponsored Entity Securities 25 12Deposits 10 39Corporate Securities 9 9Derivative Exposures 3 7Asset- and Mortgage-Backed Securities 4 4Cash 3 2


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Charter limits equity investments to 10% of unimpaired

paid-in capital, reserves, and surplus less special reserves.

Additionally, private equity funds are limited to 5% of this

sum. ADB manages equity price risk using the same due

diligence and monitoring procedures as described under

nonsovereign credit risk.

Liquidity Risk

ADB’s liquidity policy ensures the availability of sufficient

cash flows to meet all financial and operational commit-

ments despite uncertain borrowing conditions. Under the

current framework, ADB holds sufficient liquidity to fund

18 months of operations. ADB’s liquidity requirements

are primarily determined by expected loan disburse-

ments, loan amortization prepayments, debt payments,

and cash from net income.

In addition, ADB holds discretionary liquidity to provide

flexibility in funding and debt redemptions. Liquidity levels

and net cash requirements are monitored on an ongoing basis

and reviewed by the Board of Directors quarterly.

Operational Risk

Operational risk is the risk of loss resulting from inadequate

or failed internal processes, people and systems, or from ex-

ternal events. ADB is exposed to many types of operational

risk, which it mitigates through sound internal controls. ADB

has a rigorous process for approving transactions to minimize

errors in the lending function. ADB has also adopted a strat-

egy to strengthen business continuity, and particularly in-

formation technologies, to reduce the impact of disruptions.

Capital Adequacy

Capital is a financial institution’s ultimate protection

against unexpected losses that may arise from various

risks. In ADB’s context, it also protects shareholders from

the possibility of having to contribute callable or addition-

al paid-in capital. ADB uses stress testing to assess its capi-

tal adequacy on a regular basis. Throughout 2008, ADB’s

capital position remained strong.

The capital stress test assesses ADB’s ability to absorb

credit shocks, which are the institution’s principal risk, while

supporting continued lending in line with its development

mandate. The desired outcome of the stress test is that ADB

should have sufficient capital to (i) absorb an income loss

due to the credit shock, and (ii) generate sufficient income

to support post-shock loan growth. For the stress test, ADB

generates thousands of potential portfolio scenarios and im-

poses credit shocks that are large enough to account for 99%

of those scenarios. ADB then assesses the impact of these

shocks on its capital by modeling its equity-to-loan ratio over

the next 10 years. With an equity-to-loan ratio of 38% at the

end of 2008, the current stress test results comfortably ex-

ceeded the desired outcome described above.

Asset and Liability Management. The objectives of asset

and liability management for ADB is to safeguard ADB’s

net worth and overall capital adequacy, promote steady

growth in ADB’s risk bearing capacity, and define sound

financial policies to undertake acceptable levels of finan-

cial risks to provide resources for developmental lend-

ing purposes at the lowest and most stable funding cost

to the borrowers along with the most reasonable lending

terms, while safeguarding ADB’s financial strength. The

asset and liability management safeguards net worth from

foreign exchange rate risks, protects net interest margin

from fluctuation in interest rates, and provides sufficient

liquidity to meet ADB’s operations. ADB also adheres to

cost pass-through pricing policy for the loans to sovereign

borrowers, and allocates the most cost efficient borrow-

ings to fund the loans. The asset and liability management

objectives and practices were clarified and formalized in

2006 through the Board-approved comprehensive asset

and liability management policy framework. The frame-

work has formalized the guiding principles for manag-

ing OCR financial assets and liabilities, and provided the

governing framework to guide all asset and liability man-

agement-related financial policies, including liquidity, in-

vestments, equity management, and capital adequacy.

Internal Control Over Financial Reporting

In line with global best practices on corporate governance,

ADB’s management carried out an evaluation of the ade-

quacy and effectiveness of internal control over financial

reporting using criteria established in Internal Control -

Integrated Framework issued by the Committee of the

Sponsoring Organization of the Treadway Commission

(COSO). The evaluation includes test of key controls

over financial reporting, and ADB’s external auditors con-

curred that ADB maintained effective internal control

over financial reporting for 2008.

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Summary of Financial Performance

Net Income. Net income before net unrealized gains was

$675.8 million, compared with $711.4 million in 2007.

The decrease of $35.6 million (5.0%) was predominantly

due to the following:

�� -

ly due to $65.8 million net decrease in interest in-

come and other loan charges, $22.0 million increase in

expenses on asset swaps hedging loan products, and

$2.9 million decrease in provision for loan losses. De-

spite a higher outstanding loan portfolio, overall loan

income decreased because of lower US dollar LIBOR

compared with the same period in 2007;

�� -

ing from lower investment returns associated with

the decrease in the interest rate environment;

�� -

ments resulting mainly from $60.0 million reduction

in the proportionate share of income from private

equity funds, which are accounted for under equity

method, $17.0 million decrease in net realized gains

on disposal of equity investments, and recognition of

$8.7 million impairment loss mostly associated with

restructured accounts, net of $5.0 million increase in

dividend income;

�� !"� ��-

located to OCR. This was driven by the $15.9 million

increase in overall administrative expenses ($363.7

million in 2008; $347.8 million in 2007) mainly attrib-

uted to increases in salaries ($9.5 million), business

travel ($3.3 million), and contractual services ($2.2

million). This was offset by $1.5 million decrease in

deferred loan origination costs related to new loans

and guarantees;

�� # �� -

ber countries following the $10.0 million grant pro-

vided to the Java Reconstruction Fund; and

�� &�� '��* +�� -

lated expenses resulting mainly from declining inter-

est rates in some markets compared with the same

period in 2007.

Net unrealized gains of $450.6 million for the year

ended 31 December 2008 ($53.8 million in 2007) are pri-

marily the favorable result of FAS 133, 155, and 159 ap-

plication totaling $451.0 million ($57.5 million in 2007),

increasing the net income to $1,126.3 million for the year

ended 31 December 2008 from $765.2 million for the year

ended 31 December 2007.

Net Unrealized Gains and Losses on Financial Instruments as per FAS 133, 155, and 159. ADB posted net unrealized gain

of $1,441.7 million on derivatives used for hedging trans-

actions compared to net unrealized loss of $351.1 million

in 2007. Corresponding unrealized loss on the hedged

borrowings were $1,522.9 million in 2008 compared to an

unrealized gain of $408.6 million in 2007. The gain on de-

rivatives were primarily due to significant downward shift

of the short to medium-term yield curves of the major cur-

rencies, partially offset by the weakening of most major

currencies (with the exception of Japanese yen) against

the US dollar in 2008. The effect of declining interest

rates coupled with strengthening of the US dollar during

the period had a net effect of increasing the borrowing re-

lated derivatives value, i.e. swaps. The impact was largely

felt on the swaps relating to non-structured debts which

are designed to behave as long-term fixed assets denom-

inated in the hedged-borrowings in original currencies.

The liability portion of the swaps would behave similar to

long-term US dollar LIBOR-based liabilities.

Effective 1 January 2008, ADB adopted FAS 159

for non-structured swapped borrowings. The adoption

of FAS 159 resulted in a favorable adjustment of $227.5

million, which was recorded as an adjustment to the be-

ginning balance of reserves. Fair valuation of the non-

structured swapped borrowings resulted in an unrealized

loss of $2,035.9 million for 2008 offsetting the gain on the

hedged swap position of $2,001.4 million. However, the

liquidity crisis resulting from the current global financial

situation led to widening of the funding spreads resulting

in a net gain of $531.7 million from the application of cred-

it spread (FAS 157) to the entire portfolio that are carried

at fair value, including structured borrowings.

The appreciation of Japanese yen against the US dol-

lar in 2008 affected the structured debt portfolio to a cer-

tain extent. The decrease in value of the underlying debts

outweighed the increase in the value of the embedded de-

rivatives, which are highly sensitive to the expected foreign

exchange rates movements. On an after-swap basis, the

change in fair value of the structured debts led to an unreal-

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ized gain of $140.0 million for the year ended 31 December

2008. The unrealized gains were due mainly to movements

of foreign exchanges and interest rates. As the structured

instruments are fully hedged, the swaps would economi-

cally offset any foreign exchange and interest rate risks of

the instruments (Note M of OCR Financial Statements).

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Significant accounting policies are contained in Note B of

OCR’s financial statements. As disclosed in the financial

statements, Management estimates the fair value of fi-

nancial instruments. Estimates by their nature are based

on judgment and available information; therefore, actual

results may differ and might have a material impact on the

financial statements.

Fair Value of Financial Instruments. Under statutory report-

ing, ADB carries its financial instruments and derivatives,

as defined by FAS 133 and FAS 159, on a fair value basis.

These financial instruments include embedded derivatives

that are valued and accounted for in the balance sheet as

a whole. Fair values are usually based on quoted market

prices. If market prices are not readily available, fair values

are usually determined using market-based pricing models

incorporating readily observable market data and require

judgment and estimates.

The pricing models used for determining fair values

of ADB’s financial instruments are based on discounted

expected cash flows using observable market data. ADB

reviews the pricing models to assess the appropriateness

of assumptions to reasonably reflect the valuation of the

financial instruments. In addition, the fair values derived

from the models are subject to ongoing internal and ex-

ternal verification and review. The models use market-

sourced inputs such as interest rates, exchange rates, and

option volatilities. Selection of these inputs may involve

some judgment and may impact net income. ADB believes

that the estimates of fair values are reasonable given exist-

ing controls and processes.

Financial Accounting Standards Board issued FAS 157–

Fair Value Measurements, in September 2006, and FAS

159–Fair Value Option for Financial Assets and Financial

Liabilities, in February 2007. FAS 157 emphasizes the def-

inition and methods for measuring fair value, and expands

disclosure requirements for financial reporting purposes,

while FAS 159 expands the scope of financial instruments

that may be carried at fair value. These are discussed in

more detail in Note B of OCR’s financial statements.

Provision for Loan Losses. Provision against loan losses for

impaired loans reflects management’s judgment and esti-

mate of the present value of expected future cash flows dis-

counted at the loan’s effective interest rate. ADB considers

a loan impaired when, based on current information and

events, it is probable that ADB will be unable to collect all

the amounts due according to the loan’s contractual terms.

In 2006, the Board approved the revision of the loan loss

provisioning methodology for ADB’s nonsovereign operations

to a risk-based model. The assessment applies the concept of

expected loss to establish loss provision and loss reserve, simi-

lar to the concept applied to ADB’s sovereign operations ap-

proved in 2004. The provisioning estimate is performed by the

Risk Management Unit on a quarterly basis.

In the revised methodology, ADB uses an internal risk

rating system to estimate the probability of default based

on its past loan loss experience and various tools available

in the market. Loans that are considered impaired based

on the probability of default are provisioned through the

income statement. Those that are not impaired will be

provisioned through the establishment of a loss reserve in

the equity section as an allocation of net income subject

to the approval of the Board of Governors.

SPECIAL FUNDS

ADB is authorized by its Charter to establish and adminis-

ter special funds. These are the Asian Development Fund,

Technical Assistance Special Fund, Japan Special Fund,

ADB Institute Special Fund, the Asian Tsunami Fund, the

Pakistan Earthquake Fund, the Regional Cooperation and

Integration Fund, and the Climate Change Fund. Finan-

cial statements for each fund are prepared in accordance

with generally accepted accounting principles except for

ADF’s which are special purpose financial statements pre-

pared in accordance with ADF Regulations.

Asian Development Fund

ADF is ADB’s concessional financing window for devel-

oping member countries with low per capita gross na-

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tional product and limited debt repayment capacity. It

is the only multilateral source of concessional assistance

dedicated exclusively to reducing poverty and to improv-

ing the quality of life in Asia and the Pacific. Thirty-two

donor members (regional and nonregional) have contrib-

uted to the fund. Cofinancing with bilateral and multi-

lateral development partners complement ADB’s ADF

resources.

In August 2008, the Board of Governors adopted the

resolution providing for the ninth replenishment of the

ADF (ADF X) and the fourth regularized replenishment

of the TASF. The resolution provides for a substantial re-

plenishment of the ADF to finance ADB’s concessional

program for the 4-year period from January 2009, and for a

replenishment of the TASF in conjunction with the ADF

replenishment, to finance technical assistance operations

under the TASF. Total replenishment size is special

drawing rights (SDR) 7.1 billion ($11.3 billion), consist-

ing of SDR6.9 billion for ADF X and SDR0.2 billion for

TASF. About 37% of the replenishment will be financed

from new donor contributions amounting to SDR2.6 bil-

lion ($4.2 billion equivalent). The replenishment shall be

effective upon receipt of the Instruments of Contribu-

tion for Unqualified Contribution commitments in an ag-

gregate amount equivalent to at least SDR1.3 billion, and

such date should not be later than 1 July 2009.

Currency Management. Effective 1 January 2006, the new

currency management framework for ADF, which was ap-

proved by the Board of Directors in October 2005, was

implemented. Under this new framework, the practice of

managing ADF resources in as many as 15 currencies was

discontinued, and an approach based on special drawing

rights (SDR) basket of currencies was introduced. ADF

donor contributions and loan reflows received in curren-

cies that do not constitute SDR are immediately convert-

ed into one of SDR currencies to maintain SDR-based

liquidity portfolio. In addition, the borrower’s obligations

for new ADF loans are now determined in SDR.

Loan Conversion. In July 2007, as an application of the

Board-approved new currency management framework,

ADB offered a full-fledged special drawing rights (SDR)

approach to ADF legacy loans by providing ADF borrow-

ers the option to convert their existing liability (i.e., dis-

bursed and outstanding loan balance) in various currencies

into SDR, while the undisbursed portions will be treated

as new loans. The conversion will shorten the time horizon

to achieve the full benefits, reduce exchange rate volatility

associated with legacy ADF loans, and provide a consistent

debt portfolio management framework across peer multi-

lateral banks and all ADF loans. The conversion was made

available beginning 1 January 2008. A series of workshops

were conducted from late 2007 to October 2008 to promote

borrowers’ awareness of the conversion option, and assist

borrowers in making informed decisions. As of December

2008, 16 out of 30 ADF borrowing countries have signified

their agreement to the conversion and $11.5 billion of out-

standing legacy loans had been converted to SDR loans.

Revised Framework for Grants and Hard-Term Facility. In

September 2007, the Board of Directors approved the

revised ADF grant framework which limits grants eligi-

bility to ADF-only countries and introduced a new hard-

term ADF lending facility. The facility will have a fixed

interest rate of 150 basis points below the weighted av-

erage of the 10-year fixed swap rates of the special draw-

ing rights component currencies plus the OCR lending

spread, or the current ADF rate, whichever is higher.

Other terms are similar to those of regular ADF loans.

In general, blend countries with per capita income not

exceeding the International Development Association

operational cutoff for more than 2 consecutive years and

an active ordinary capital resources lending program are

eligible to borrow from this new facility. The interest

rate will be reset every January through a board informa-

tion paper. The rate will apply to all hard-term loans ap-

proved that year and will be fixed for the life of the loan.

For hard-term ADF loans approved in 2008, the interest

rate was set at 3.15%. Three loans were approved under

this new facility in 2008.

Financial Framework. In December 2007, the Board of Di-

rectors approved a new ADF financial framework that aims

to enhance the long-term financial capacity of ADF and im-

prove prudential financial management practices. The new

framework establishes tranching of liquidity to improve the

liquidity management and prudential minimum liquidity

level ADF should maintain. The new framework allows

ADF to have a higher and more stable commitment author-

ity for future replenishments and ensure that liquidity is

managed in a transparent and efficient manner.

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Heavily Indebted Poor Countries (HIPC) Debt Relief. ADF

donors requested ADB’s participation in the HIPC debt

relief. In line with this, ADB Board of Governors adopted

Board Resolution No. 329 on 7 April 2008 for ADB to par-

ticipate in the HIPC debt relief, and to provide Afghan-

istan with debt relief. The estimated principal amount

of Afghanistan’s ADF debt to be forgiven and charged

against ADF income is $89.8 million.6

The HIPC Initiative was launched in 1996 by the In-

ternational Development Association and International

Monetary Fund to reduce the excessive debt burden faced

by the world’s poorest countries. A “sunset clause” was

stipulated to prevent the HIPC debt relief from becoming

a permanent facility, minimize moral hazard, and encour-

age early adoption of reform programs. This has been ex-

tended several times with the latest “sunset clause” being

end-2006 with a “ring-fence” of its application to coun-

tries satisfying the income and indebtedness criteria using

end-2004 data. Thus far, Afghanistan is the only ADF bor-

rower that has qualified for HIPC debt relief. While other

ADF borrowers have met the HIPC indebtedness crite-

ria, it is not possible to currently estimate whether these

countries will qualify for HIPC debt relief.

Under the policy, upon approval of debt relief for a

country by the Board of Directors, the principal compo-

nent of the estimated debt relief costs will be recorded

as a reduction of the disbursed and outstanding loans on

a provisional basis and charged against ADF income. The

International Development Association and Internation-

al Monetary Fund boards will decide when a country has

satisfied the conditions for reaching the completion point.

Upon reaching the completion point the debt relief will

become irrevocable. The accumulated provision for HIPC

debt relief will be reduced when debt relief is provided on

the loan service payment date. As of 31 December 2008,

provision of $0.5 million has been written off under this

arrangement, bringing the balance to $87.5 million, at 31

December 2008 exchange rate.

Contributed Resources. During the eighth replenishment of

the ADF (ADF IX), donors recommended a replenishment

of $7.0 billion, consisting of $3.3 billion in new contributions

from donors and $3.7 billion from internal resources based on

the exchange rate specified in the Resolution of the Board

of Governors. ADF IX, which covers the 4-year period from

2005 to 2008, became effective in April 2005 after instru-

ments of contribution deposited with ADB for unqualified

contribution exceeded 50% of all pledged contributions. As

of 31 December 2008, 30 donors have committed a total of

$3.7 billion7 to ADF IX, including contributions of Ireland

($32.5 million) and Brunei Darussalam ($9.5 million). Total

deposited installment payments amounting to $3.4 billion7

include $3.0 billion for ADF operations, $0.2 billion for Tech-

nical Assistance Special Fund, and $0.2 billion for financing

forgone interest of grants. The remaining unpaid contribu-

tions under ADF VIII as of 31 December 2008 amounted to

$168.8 million7 (For details of amounts released for opera-

tional commitment in 2008, see the column labeled “Addi-

tion” in Statistical Annex 23.)

In May 2008, the Board of Governors approved the

transfer of $40 million to ADF as part of OCR’s net in-

come allocation ($40 million in 2007). In addition, a to-

tal of $1,133.3 million from loan savings and cancellations

have been included in the commitment authority. This

resulted from Management’s continuous assessment of

6 Based on the disbursed and outstanding debt as of 20 March 2006, converted to US dollar using the exchange rate as of 7 April 2008.7 US dollar equivalent at 31 December 2008 exchange rates.

Table 19: Asian Development Fund Commitment Authoritya

31 December 2008 and 2007 ($ Million)

2008 2007

Carryover from ADF VIII Commitment Authorityb 124.4 126.9

ADF IX Contributionsc 2,976.5 2,144.4

ADF VIII Contributions 161.6 164.6

OCR Net Income Transfer 160.0 120.0

Expanded Advance Commitment Authority 3,895.7 2,979.7

Loans Savings and Cancellation 1,133.3 890.8

Credits from Accelerated Note Encashment Program 63.0 –

Provision for Disbursement Riskd (158.4) (157.9)

Provision for Foreign Exchange Volatilitye 15.2 –

Total ADF IX Commitment Authority 8,371.3 6,268.5

Loans and Grants Committed 8,248.7 5,833.1

ADF Commitment Authority Available for Future Commitments 122.6 435.4

( ) = negative, ADF = Asian Development Fund, OCR = ordinary capital resources.a The schedule reflects cumulative commitment authority for ADF IX.b The US dollar equivalent of SDR80.4 million at each year-end exchange rates.c Contributions received to finance forgone interest of grants are excluded as they

have been incorporated as cash inflows in the computation of Expanded Advance Commitment Authority.

d Applies to contribution and net income transfer received prior to the adoption of the new ADF Financial Framework in December 2007.

e Represents an allowance to cover the shortfall in the commitment authority due to exchange rate fluctuation during the last 3 months of 2008.

Note: Total may not add due to rounding.

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opportunities for freeing committed resources through

cancellations of unused loan balances. During 2008, prom-

issory notes totaling $603.1 million have been encashed,

$58.6 million of which was transferred to the Technical

Assistance Special Fund.

Loan Approvals, Disbursements, and Repayments. In 2008,

36 ADF loans totaling $1.8 billion were approved com-

pared with 36 loans totaling $1.9 billion in 2007. Dis-

bursements during 2008 totaled $2.0 billion, an increase

of 26.3% from $1.6 billion in 2007. At the end of the year,

cumulative disbursements from ADF resources were

$27.0 billion. Loan repayments during the year amount-

ed to $676.9 million. At year-end, outstanding ADF loans

amounted to $26.4 billion.

Status of Loans. At the end of the year, 28 sovereign loans to

Myanmar with total principal outstanding of $565.8 mil-

lion were in non-accrual status representing about 2.1% of

the total outstanding ADF loans.

Investment Portfolio Position. The ADF investment port-

folio8 amounted to $6.3 billion at 31 December 2008 com-

pared with $7.0 billion in 2007. About 16% of the portfolio

was invested in bank deposits, and 84% was invested in

fixed income securities. The annualized rate of return on

ADF investments including unrealized gains and losses

was 5.2% (4.7% in 2007).

Grants. With the introduction of grant financing in ADF

IX, 27 grants (24 in 2007) were approved in 2008 totaling

$707.4 million ($519.3 million in 2007), while 27 grants

(17 in 2007) totaling $539.8 million ($377.8 million in

2007) became effective.

Cofinancing for Loans. In 2008, $87.0 million was mobilized

in official loan cofinancing for two loan projects totaling

$126.0 million.

Technical Assistance Special Fund

The Technical Assistance Special Fund was established

to provide technical assistance on a grant basis to devel-

oping member countries of the Asian Development Bank

and regional technical assistance.

In August 2008, the Board of Governors adopted the

resolution providing for the ninth replenishment of the

ADF (ADF X) and the fourth regularized replenishment

of the Technical Assistance Special Fund (TASF). Con-

sidering the demand estimate and the availability of funds

from other sources, the donors agreed to contribute 3% of

the total replenishment size as the fourth replenishment

of the TASF. The replenishment will cover the 4-year pe-

riod 2009 to 2012 (see related notes under ADF).

Contributed Resources. As of 31 December 2008, 28 do-

nors committed a total of $219.5 million to TASF, as part

of the ADF IX and the third regularized replenishment

of TASF. Of the total commitment, $202.9 million have

been received.

During the year, India made a direct voluntary con-

tribution amounting to $0.25 million, and Pakistan, $0.07

million. In addition, $23.0 million was allocated to TASF

as part of OCR’s 2007 net income allocation, and a total

of $7.0 million regularized replenishment was received.

At the end of 2008, total TASF resources amounted to

$1,402.6 million, of which $1,299.9 million was commit-

ted, leaving an uncommitted balance of $102.7 million

(Statistical Annex 24).

Operations. Technical assistance (TA) commitments

(approved and effective) increased from $77.5 million

in 2007 to $108.2 million in 2008 for 156 TA projects that

were made effective during the year, net of $15.6 mil-

lion ($11.9 million in 2007) write back of undisbursed

commitments for completed and cancelled TA projects.

Undisbursed commitments for technical assistance in-

creased to $222.7 million as of 31 December 2008 ($183.7

Table 20: Technical Assistance Special Fund Cumulative Resources($ Million)

2008 2007

Regularized Replenishment Contributions 432.6 425.7Allocations from OCR Net Income 706.0 683.0Direct Voluntary Contributions 89.2 88.8Income from Investment and Other Sources 178.3 167.3Transfers from the TASF to the ADF (3.5) (3.5)

TOTAL 1,402.6 1,361.3

( ) = negative, ADF = Asian Development Fund, OCR = ordinary capital resources, TASF = Technical Assistance Special Fund.

8 Includes securities purchased under resale arrangement.

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million as of 31 December 2007). TASF financed 43.5%

of all TA activities approved in 2008.

Investment Position. As of 31 December 2008, total TASF

investment portfolio, including securities purchased un-

der resale arrangement, amounted to $295.7 million,

slightly higher than the $295.1 million as of year-end of

2007. Despite a higher investment portfolio in 2008, to-

tal revenue from investments decreased to $10.9 million,

from $14.2 million during the same period in 2007, due

mainly to the decrease in yield on US dollar placements.

Japan Special Fund

The Japan Special Fund was established in 1988 when

ADB acting as the administrator, entered into a financial

arrangement with Japan, who agreed to make the initial

contribution, to help developing member countries of

ADB restructure their economies and broaden the scope

of opportunities for new investments, mainly through

technical assistance operations.

Contributed Resources. In January 2008, Japan contributed

¥1.9 billion ($17.4 million equivalent) as a regular contri-

bution to Japan Special Fund. As of 31 December 2008,

Japan’s cumulative contribution to the fund since its in-

ception in 1988 amounted to ¥112.9 billion (about $973.7

million equivalent) comprising regular contributions of

¥94.8 billion ($822.9 million equivalent) and supplemen-

tary contributions of ¥18.1 billion ($150.8 million equiv-

alent). The uncommitted balance including approved

technical assistance but not yet effective as of 31 Decem-

ber 2008 was $86.8 million.

Operations. The technical assistance (TA) grants financed

by Japan Special Fund continued to support ADB opera-

tions aimed at reducing poverty. In 2008, 57 TA projects

totaling $55.0 million were approved, and 69 TA projects

totaling $59.6 million became effective. The undisbursed

TA commitments increased to $95.8 million as of 31 De-

cember 2008 ($82.9 million as of 31 December 2007).

Sector Activities. In 2008, the Japan Special Fund (JSF)

financed 20% of the total amount of technical assis-

tance (TA) that ADB approved, including 47% of the

total amount of project preparatory TA during the year.

Table 21 illustrates the breakdown of JSF approvals by

sector.

Investment position. As of 31 December 2008, total Japan

Special Fund investment portfolio amounted to $198.9

million, lower than the balance of $215.1 million as of 31

December 2007. With this, and with lower yield on US

dollar placements, revenue from investments decreased,

from $11.8 million in 2007 to $6.5 million in 2008.

ADB Institute Special Fund

The ADB Institute was established in 1996 as a subsid-

iary body of ADB, whose objectives are the identification

of effective development strategies and capacity improve-

ments for sound development management in developing

member countries.

The costs for operating the ADB Institute are met

from the ADB Institute Special Fund which is adminis-

tered by ADB in accordance with the Statute of ADB In-

stitute. In 2008, Japan committed its 13th contribution

in the amount of ¥0.70 billion ($7.8 million equivalent),

which was reported as Due from Contributors.

As of 31 December 2008, cumulative contributions

committed amounted to ¥16.5 billion (about $141.2 mil-

lion equivalent) excluding translation adjustments. Of

the total contributions received, $125.5 million had been

used by the end of the year mainly for research and ca-

pacity-building activities including organizing symposia,

forums, and trainings; preparing research reports, publi-

cations, and websites; and for associated administrative

expenses. The balance of net current assets (excluding

property, furniture, and equipment) available for future

projects and programs was about $15.6 million.

Table 21: Japan Special Fund Technical Assistance by Sector, 2008

$ Milliona %

Agriculture and Natural Resources 13.5 25Transport and Communications 10.1 18Multisector 9.1 17Education 4.5 8Law, Economic Management and Public Policy 4.4 8Energy 4.4 8Industry and Trade 3.8 7Finance 2.9 5Water Supply, Sanitation and Waste Management 1.9 3Health, Nutrition, and Social Protection 0.4 1

TOTAL 55.0 100a Totals may not add due to rounding.

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Asian Tsunami Fund

The Asian Tsunami Fund was established on 11 Febru-

ary 2005 in response to the special circumstances sur-

rounding the developing member countries that were

stricken by the effects of the tsunami on 26 December

2004.

Contributed Resources. ADB contributed $600 million

to the fund, of which, $50 million unutilized funds

were transferred back to OCR ($40 million in Novem-

ber 2005 and $10 million in June 2006). In addition,

Australia contributed $3.8 million, and Luxembourg,

$1.0 million. As of 31 December 2008, total resources

of the fund amounted to $625.9 million, $579.5 million

of which has been utilized, leaving an uncommitted bal-

ance of $46.4 million ($40.0 million as of 31 December

2007).

Operations. There were no technical assistance or grants

that were approved or made effective during the year. The

balance of undisbursed commitments as of 31 December

2008 amounted to $248.3 million, compared with $389.1

million as of year-end of 2007.

Investment position. As of 31 December 2008, Asian Tsuna-

mi Fund’s investment portfolio amounted to $251.3 mil-

lion ($366.5 million as of 31 December 2007). With the

lower portfolio, and lower yield on US dollar placements,

revenue from investments decreased, from $22.3 million

in 2007 to $9.1 million in 2008.

Pakistan Earthquake Fund

The Pakistan Earthquake Fund was established in No-

vember 2005 in response to the special needs of Pakistan

subsequent to the earthquake on 8 October 2005. The

dedicated fund is to deliver emergency grant financing for

investment projects and technical assistance to support

immediate reconstruction, rehabilitation and associated

development activities.

Contributed Resources. ADB contributed $80 million to

the fund. In addition, Australia contributed $15.0 mil-

lion; Belgium, $14.3 million; Finland, $12.3 million; and

Norway, $20.0 million. As of 31 December 2008, total re-

sources of the fund amounted to $142.4 million, $140.2

million of which has been utilized, leaving an uncommit-

ted balance of $2.2 million (negative $3.5 million as of 31

December 2007).

The contributions of Belgium and Norway were in

the form of debt-for-development swap agreements. The

agreements involved the conversion of Pakistan’s loan

service payments to the two countries for their loans to

Pakistan of up to €9.9 million and $20.0 million, respec-

tively, into Belgium’s and Norway’s contributions to the

Pakistan Earthquake Fund. Belgium’s contributions were

made in three equal installments of €3.3 million from 2007

to 2008, while Norway’s contributions were undertaken

in four equal installments of $5.0 million in 2006–2008.

Operations. There were no technical assistance or grants

that were approved or made effective during the year. The

balance of undisbursed commitments as of 31 December

2008 amounted to $66.2 million, compared with $73.2

million as of year-end of 2007.

Investment position. As of 31 December 2008, Pakistan

Earthquake Fund’s investment portfolio amounted to

$61.3 million ($60.7 million as of 31 December 2007).

With the increase in the average investment portfolio, rev-

enue from investments for 2008 increased to $3.1 million

from $2.4 million in 2007.

Regional Cooperation and Integration Fund

The Regional Cooperation and Integration Fund was es-

tablished in February 2007 in response to the increasing

demand for regional cooperation and integration activities

among ADB’s member countries in Asia and the Pacific.

Its main objective is to improve regional cooperation and

integration (RCI) in Asia and the Pacific by facilitating the

pooling and provision of additional financial and knowl-

edge resources to support RCI activities.

Contributed Resources. ADB contributed $40 million to the

fund as part of the 2006 OCR net income allocation. As of

31 December 2008, total resources of the fund amounted

to $42.5 million, $17.9 million of which has been utilized,

leaving an uncommitted balance of $24.6 million ($33.8

million as of 31 December 2007).

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Operations. In 2008, 13 technical assistance totaling $10.5

million became effective (four technical assistance and

one supplementary approval totaling $7.4 million in

2007). The balance of undisbursed commitments as of

31 December 2008 amounted to $16.6 million, compared

with $7.4 million as of year-end of 2007.

Investment position. As of 31 December 2008, Regional

Cooperation and Integration Fund’s investment port-

folio amounted to $39.3 million ($39.9 million as of 31

December 2007). With the increase in average volume of

investments, which was offset by lower yield on US dollar

placements, revenue from investments for 2008 was just

slightly higher than the revenue for 2007 ($1.24 million in

2008; $1.19 million in 2007).

Climate Change Fund

The Climate Change Fund was established in April 2008

to facilitate greater investments in DMCs to address the

causes and consequences of climate change alongside

ADB’s own assistance in various related sectors.

Contributed Resources. ADB provided the initial contribu-

tion of $40.0 million in May 2008, as part of OCR’s 2007

net income allocation. With accumulated investment in-

come of $0.5 million, total resources of the fund as of 31

December 2008 amounted to $40.5 million, $3.1 million

of which has been utilized, leaving an uncommitted bal-

ance of $37.4 million.

Operations. In 2008, one technical assistance amounting

to $3.0 million was approved and became effective. There

has been no disbursement yet for this technical assistance.

Investment position. As of 31 December 2008, Climate

Change Fund’s investment portfolio amounted to $38.9

million, providing $0.5 million revenue for the period.

GRANT COFINANCING

Trust funds and project-specific grants are key instruments

to mobilize and channel grants from external sources to fi-

nance technical assistance and components of investment

projects. They play an important role in complementing

ADB’s own resources to meet capacity development and

other specific demands from DMCs. Multilateral, bilateral,

and private sector partners have contributed more than $2.0

billion in grants to ADB operations (Table 22). In 2008, a

total of $154.2 million in grant cofinancing was mobilized

comprising $84.2 million for 76 technical assistance proj-

ects and $70.0 million for 17 investment projects. By year-

end, there were 29 trust funds under active administration

by ADB which included 19 active single donor trust funds

to finance activities in various sectors or for specific themes,

and 10 multidonor trust funds to finance activities with a

thematic focus, including poverty reduction, governance,

gender and development, managing for development re-

sults, HIV/AIDS, water, energy, education, information

and communications technology, and trade and finance.

Initially, trust funds were established through donor-

specific channel financing agreements, for a wide range

of sectors, focused primarily on financing technical assis-

tance operations. More recently, in response to the chang-

ing needs of developing member countries and consistent

with ADB’s financing partnership strategy9 and harmoniza-

tion efforts, ADB has established some trust funds based

on common agreements with development partners and

financing through instruments of contribution. These are

established under an umbrella facility of sector- and theme-

focused financing partnership, and finance technical assis-

tance and grant components of investment projects.

Technical Assistance and Grant Funds under Financing Part-nership Facilities and Special Initiatives. ADB has estab-

lished two multidonor and three single donor trust funds

under the financing partnership facilities framework, to

support both technical assistance and grant components

of investment projects in priority sectors consistent with

Strategy 2020. Since 2006, about $100.0 million has been

mobilized from bilateral sources to finance activities in

the water sector, for clean energy, and for regional coop-

eration and integration.

Japan made its initial contributions of $23.1 million

to the Asian Clean Energy Fund and $11.5 million to the

Investment Climate Facilitation Fund, the two new ini-

tiatives that were established last year under the Clean

Energy Financing Partnership Facility and Regional Co-

9 ADB. 2006. ADB’s Financing Partnership Strategy. Manila.

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operation and Integration Facility. Austria and Spain each

contributed $5 million to the Multidonor Water Trust

Fund. Spain and Sweden made their first contributions of

$5 million and $4.7 million respectively, to the Multido-

nor Clean Energy Fund. Australia expressed its intent to

make a total additional contribution of A$25 million each

to these multidonor funds by 2011.

Under ADB’s Carbon Market Initiative, the Future

Carbon Fund was established in 2008 complementing the

existing Asia Pacific Carbon Fund. The fund will provide

financing up front for ADB-supported projects that will

continue to generate carbon credits after 2012. The initial

target size of the fund is $100 million and may be increased

to $200 million if there is sufficient demand.

Japan Fund for Poverty Reduction

The Japan Fund for Poverty Reduction (JFPR) was estab-

lished in May 2000 as a trust fund to support poverty re-

duction and social development activities that can add

substantial value to ADB projects. Since 2000, Japan has

contributed $360.4 million in total. To date, $300.3 million

for 116 projects has been approved, of which 13 projects val-

ued at $34.0 million were approved in 2008 (www.adb.org/

JFPR; Statistical Annex 27). A number of projects have been

completed this year and these are the subjects of knowledge-

sharing sessions organized by ADB. In 2008, the JFPR publi-

cation series was launched which will focus on the impact and

outcomes, and lessons learned from JFPR projects.

Japan Scholarship Program

The Japan Scholarship Program (JSP) was established in

1988 to provide an opportunity for well-qualified citizens

of developing member countries to undertake postgradu-

ate studies in economics, management, science and tech-

nology, and other development-related fields at selected

educational institutions in Asia and the Pacific. JSP is

funded by Japan and administered by ADB. Currently, 20

institutions in 10 countries participate.

Between 1988 and 2008, Japan contributed $100.1

million. A total of 2,417 scholarships has been awarded

to recipients from 35 member countries. Recently, an av-

erage of about 150 scholarships have been awarded each

year. Of the total, 2,053 have completed their courses.

Women have received 823 scholarships.

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Table 22: Schedule of Contributions and Net AssetsGrants from External SourcesAs of 31 December 2008 ($ Million)

Contribution Net Assetsa

Administered by ADB

Country

Australia 161.3 13.6 Austria 6.0 3.3 Belgium 29.2 27.1 Brunei Darussalam 0.6 (0.0) Canada 124.1 51.6 China, People’s Republic of 20.2 8.3 Denmark 24.7 2.9 European Community 250.0 93.9 Finland 56.8 31.5 France 33.4 4.1 Ireland 2.2 0.5 Italy 2.7 0.9 Japanb 526.8 214.2 Korea, Republic of 20.1 13.9 Luxembourg 18.2 15.5 The Netherlands 370.1 126.8 New Zealand 31.6 0.6 Norway 117.5 43.6 Portugal 15.0 15.1 Spain 47.6 37.8 Sweden 142.2 49.9 Switzerland 40.0 28.0 United Kingdom and Northern Ireland 491.9 139.8 United States 1.8 0.4

Subtotal 2,534.0 923.3

Others

Cities Alliance 0.5 (0.0) Global Environment Fund 76.0 28.3 Nordic Development Fund 11.0 (0.4) Private Sector/Foundations 3.0 0.1 Public Private Infrastructure Advisory Facility 0.4 (0.0) Trust Fund for Forest (Viet Nam) 17.2 1.5 United Nation Development Programme 111.2 0.3

Subtotal 219.3 29.8

Not Administered by ADB

Country Switzerland 25.7 6.6 Kuwait 15.0 1.0

Subtotal 40.7 7.6

Grand Total 2,794.1 960.7

Note: Figures may not add to total due to rounding.( ) Negative; 0.0 is less than $50,000. a Excludes projects approved but not yet effective. b Includes Japan Fund for Poverty Reduction, Japan Scholarship Program, Japan Fund for Information, Communication and Technology, and Japan Fund for Public Policy Training.

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ES33Annual Report 2008

ORDINARY CAPITAL RESOURCES

Management's Report on Internal Control over Financial Reporting

The management of Asian Development Bank (“ADB”) is responsible for establishing and

maintaining adequate internal control over financial reporting. ADB's internal control over

financial reporting is a process designed to provide reasonable assurance regarding the reliabil-

ity of financial reporting and the preparation of financial statements for external purposes in

accordance with generally accepted accounting principles in the United States of America.

ADB's internal control over financial reporting includes those policies and procedures that

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly re-

flect the transactions and dispositions of the assets of ADB; (ii) provide reasonable assurance

that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures

of ADB are being made only in accordance with authorizations of management and directors

of ADB; and (iii) provide reasonable assurance regarding prevention or timely detection of

unauthorized acquisition, use or disposition of ADB's assets that could have a material effect

on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent

or detect misstatements. Also, projections of any evaluation of effectiveness to future periods

are subject to the risk that controls may become inadequate because of changes in conditions,

or that the degree of compliance with the policies or procedures may deteriorate.

ADB's management assessed the effectiveness of ADB's internal control over financial report-

ing as of 31 December 2008. In making this assessment, ADB's management used the criteria

set forth by the Committee of Sponsoring Organizations of the Treadway Commission in

Internal Control – Integrated Framework. Based on that assessment, management believes that as

of 31 December 2008, ADB's internal control over financial reporting is effective based upon

the criteria established in Internal Control – Integrated Framework.

Haruhiko Kuroda

President

Bindu N. Lohani

Vice President (Finance and Administration)

Hong-Sang Jung

Controller

5 March 2009

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ESAsian Development Bank34

Report of Independent Auditors to the Asian Development Bank

In our opinion, the accompanying balance sheets and the related statements of income and expenses,

cash flows, and changes in capital and reserves present fairly, in all material respects, the financial

position of the Asian Development Bank (“ADB” or “the Bank”)—Ordinary Capital Resources at

31 December 2008 and 2007, and the results of its operations and its cash flows for the years then

ended, in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, management’s assertion that ADB maintained effective internal control over

financial reporting as of 31 December 2008 is fairly stated, in all material respects, based on criteria

established in Internal Control—Integrated Framework issued by the Committee of Sponsoring

Organizations of the Treadway Commission (COSO). The management of ADB is responsible for

these financial statements, for maintaining effective internal control over financial reporting and for

its assertion of the effectiveness of internal control over financial reporting, included in the accom-

panying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to

express opinions on these financial statements and on ADB’s internal control over financial report-

ing based on our integrated audit in 2008 and financial statement audit in 2007. We conducted our

audits of the financial statements in accordance with auditing standards generally accepted in the

United States of America and our audit of internal control over financial reporting in accordance

with attestation standards established by the American Institute of Certified Public Accountants.

Those standards require that we plan and perform the audits to obtain reasonable assurance about

whether the financial statements are free of material misstatement and whether effective internal

control over financial reporting was maintained in all material respects. Our audits of the financial

statements included examining, on a test basis, evidence supporting the amounts and disclosures

in the financial statements, assessing the accounting principles used and significant estimates made

by management, and evaluating the overall financial statement presentation. Our audit of internal

control over financial reporting included obtaining an understanding of internal control over financial

reporting, assessing the risk that a material weakness exists, and testing and evaluating the design

and operating effectiveness of internal control based on the assessed risk. Our audits also included

performing such other procedures as we considered necessary in the circumstances. We believe that

our audits provide a reasonable basis for our opinions.

PricewaterhouseCoopers LLPpwc.com/sg 8 Cross Street #17-00PWC BuildingSingapore 048424Telephone (65) 6236 3388Facsimile (65) 6236 3300

GST No.: M90362193L Reg. No.: T09LL0001D

PricewaterhouseCoopers LLP (Registration No. T09LL0001D) is an accounting limited liability partnership registered in Singapore under the Limited Liability Partner-ships Act (Chapter 163A). It was converted from a partnership (with the name “PricewaterhouseCoopers” and Registration no. 000640) to an accounting limited liability partnership on 1 January 2009. PricewaterhouseCoopers LLP is part of the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.

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Our audits were conducted for the purpose of forming an opinion on the basic financial statements

taken as a whole. The accompanying summary statements of loans and of borrowings as at 31 De-

cember 2008 and 2007, and of statement of subscriptions to capital stock and voting power as at 31

December 2008 are presented for purposes of additional analyses and are not required parts of the

basic financial statements. Such information has been subjected to the auditing procedures applied in

the audits of the basic financial statements and in our opinion, is fairly stated in all material respects

in relation to the basic financial statements taken as a whole.

A company’s internal control over financial reporting is a process effected by those charged with

governance, management, and other personnel, designed to provide reasonable assurance regarding

the preparation of reliable financial statements in accordance with accounting principles generally

accepted in the United States of America. A company’s internal control over financial reporting in-

cludes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable

detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of

financial statements in accordance with generally accepted accounting principles, and that receipts and

expenditures of the company are being made only in accordance with authorizations of management

and those charged with governance; and (iii) provide reasonable assurance regarding prevention, or

timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could

have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect

misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to

the risk that controls may become inadequate because of changes in conditions, or that the degree

of compliance with the policies or procedures may deteriorate.

PricewaterhouseCoopers LLP

Public Accountants and Certified Public Accountants

Singapore

5 March 2009

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ASIAN DEVELOPMENT BANK—ORDINARY CAPITAL RESOURCES

BALANCE SHEET 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

A S S E T S

2008 2007

DUE FROM BANKS (Notes B and C) $ 142,238 $ 108,821

INVESTMENTS (Notes B, C, D, L, and P) Government and government-guaranteed obligations $ 6,485,000 $ 2,343,130 Time deposits 1,481,370 7,491,886 Other securities 7,446,149 15,412,519 3,461,927 13,296,943

SECURITIES TRANSFERRED UNDER REPURCHASE AGREEMENT (Notes B and P) 309,358 5,041,387

SECURITIES PURCHASED UNDER RESALE ARRANGEMENT (Notes B and P) 511,756 427,132

LOANS OUTSTANDING (OCR-5) (Notes A, B, E, and Q) (Including FAS 133 adjustment of $451– 2008 and $538 – 2007; net unamortized loan origination costs of $68,262 – 2008 and $42,130 – 2007) Sovereign 34,256,740 29,008,793 Nonsovereign 1,662,494 1,289,129

35,919,234 30,297,922

Less—provision for loan losses 9,174 35,910,060 15,043 30,282,879

EQUITY INVESTMENTS (Notes A, B, G, and P) 641,427 808,157

ACCRUED REVENUE On investments 131,880 143,785 On loans 299,184 431,064 320,514 464,299

RECEIVABLE FROM MEMBERS (Note K) Nonnegotiable, noninterest-bearing demand obligations (Note C) 144,514 174,805

RECEIVABLE FROM SWAPS (Notes B, H, P, and Q) Borrowings 23,831,087 17,968,867 Others 882,793 24,713,880 512,089 18,480,956

OTHER ASSETS Property, furniture, and equipment (Notes B and I) 158,235 154,239 Investment related receivables 229,390 138,149 Unamortized issuance cost of borrowings 2,781 58,869 Miscellaneous (Note N) 114,530 504,936 112,536 463,793

TOTAL $78,721,752 $69,549,172

The accompanying notes are an integral part of these financial statements (OCR-8).

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OCR-1

LIABILITIES, CAPITAL, AND RESERVES

2008 2007 BORROWINGS (OCR-6) (Notes B, H, J, and P) At amortized cost $ 4,627,521 $28,615,661 At fair value 31,012,976 $35,640,497 2,954,704 $31,570,365

ACCRUED INTEREST ON BORROWINGS 385,949 388,935

PAYABLE FOR SWAPS (Notes B, H, J, P, and Q) Borrowings $24,867,815 $16,936,964 Others 1,198,781 26,066,596 583,320 17,520,284

PAYABLE UNDER SECURITIES REPURCHASE AGREEMENT (Note B) 301,759 5,092,316

ACCOUNTS PAYABLE AND OTHER LIABILITIES Investment related payables 275,066 230,114 Undisbursed technical assistance commitments (Note M) 10,489 2,318 Accrued pension and postretirement medical benefit costs (Note O) 635,300 368,284 Miscellaneous (Notes B, F, I, and N) 136,626 1,057,481 121,686 722,402

TOTAL LIABILITIES 63,452,282 55,294,302

CAPITAL AND RESERVES (OCR-4) Capital stock (OCR-7) (Notes B and K) Authorized and subscribed (SDR35,463,110,000 – 2008 and 2007) 54,890,156 55,977,810 Less—”callable” shares subscribed 51,029,546 52,040,702

“Paid-in” shares subscribed 3,860,610 3,937,108 Less—subscription installments not due 9,848 19,664

Subscription installments matured 3,850,762 3,917,444 Less—capital transferred to the Asian Development Fund 73,691 75,151

3,777,071 3,842,293

Net notional amounts required to maintain value of currency holdings (Notes B and K) (564,383) (661,197) Ordinary reserve (Note L) 9,532,487 9,245,332 Special reserve (Note L) 209,723 202,847 Loan loss reserve (Note L) 195,062 182,100 Surplus (Note L) 894,594 616,300 Cumulative revaluation adjustments account (Note L) (23,336) (110,959) Cumulative effect of FAS 157/159 adoption (Note B) 227,500 – Net income after appropriation (OCR-2) (Note L) 1,119,473 760,174 Accumulated other comprehensive income (OCR-4) (Notes B and L) (98,721) 15,269,470 177,980 14,254,870

TOTAL $78,721,752 $69,549,172

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OCR-2


STATEMENT OF INCOME AND EXPENSES For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

REVENUE (Note M) From loans (Notes B and E) Interest $1,316,105 $1,385,036 Commitment charge 59,668 55,206 Other (17,792) $1,357,981 2,096 $1,442,338

From investments (Notes B and D) Interest 677,175 683,212

From guarantees (Notes B and F) 6,876 5,049

From equity investments 3,737 58,897

From other sources—net (Notes E and R) 18,685 18,835

TOTAL REVENUE $2,064,454 $2,208,331

EXPENSES (Note M) Borrowings and related expenses (Note J) 1,208,391 1,389,778 Administrative expenses (Note M) 141,047 127,327 Technical assistance to member countries 8,357 (683) Provision for losses (Notes B and E) (3,467) (579) Other expenses 6,272 3,998

TOTAL EXPENSES 1,360,600 1,519,841

NET REALIZED GAINS (LOSSES) From loans 525 3,980 From investments (Notes D and M) (24,837) (2,801) From equity investments (Note M) (3,884) 21,793 From borrowings 70 (106) Others 30 39

NET REALIZED (LOSSES) GAINS (28,096) 22,905

NET UNREALIZED GAINS (Note M) 450,591 53,828

NET INCOME $1,126,349 $ 765,223


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OCR-3 ASIAN DEVELOPMENT BANK—ORDINARY CAPITAL RESOURCES

STATEMENT OF CASH FLOWS For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007 CASH FLOWS FROM OPERATING ACTIVITIES Interest and other charges on loans received $ 1,230,411 $ 1,202,933 Interest on investments received 633,155 635,459 Interest received for securities purchased under resale arrangement 5,634 17,080 Interest and other financial expenses paid (913,351) (1,236,490) Administrative expenses paid (118,517) (95,784) Technical assistance disbursed (136) (1,477) Others—net 49,153 13,452

Net Cash Provided by Operating Activities 886,349 535,173

CASH FLOWS FROM INVESTING ACTIVITIES Sales of investments 7,979,848 8,205,482 Maturities of investments 152,126,260 176,587,583 Purchases of investments (162,198,163) (184,797,477) Net receipts (payments) on future contracts 1,082 (372) Net (payments for) receipts from securities purchased under resale arrangement (61,122) 1,990 Principal collected on loans 1,919,052 1,454,419 Loans disbursed (6,340,161) (5,074,927) Net currency and interest rate swaps 2,097 (8,329) Property, furniture, and equipment acquired (20,302) (9,569) Purchases of equity investments (125,697) (115,603) Sales of equity investments 53,550 112,107

Net Cash Used in Investing Activities (6,663,556) (3,644,696)

CASH FLOWS FROM FINANCING ACTIVITIES Net proceeds of new borrowings 11,803,386 11,874,946 Borrowings redeemed (6,301,308) (9,137,838) Matured capital subscriptions collected1 4,618 4,618 Borrowing issuance expenses paid (13,030) (30,506) Demand obligations of members encashed 9,255 8,068 Net currency and interest rate swaps 408,500 368,067 Resources transferred to ADF (40,000) (40,000) Resources transferred to TASF (23,000) – Resources transferred to CCF (40,000) – Resources transferred to RCIF – (40,000)

Net Cash Provided by Financing Activities 5,808,421 3,007,355

Effect of Exchange Rate Changes on Due from Banks 2,203 5,571

Net Increase (Decrease) in Due from Banks 33,417 (96,597)

Due from Banks at Beginning of Year 108,821 205,418

Due from Banks at End of Year $ 142,238 $ 108,821

RECONCILIATION OF NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES: Net Income (OCR-2) $ 1,126,349 $ 765,223 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 301,985 81,127 Provision for losses written back—net (3,467) (579) Net realized losses (gains) from investments and other borrowings 19,963 (18,886) Proportionate share in losses (earnings) on equity investments 12,160 (47,827) Net unrealized gains (450,591) (53,828) Change in accrued revenue from loans, investments, and other swaps (116,103) (252,022) Change in receivable from ADF - allocation of administrative expenses (2,973) (2,902) Change in accrued interest on borrowings and swaps, and other expenses 224,249 144,002 Change in undisbursed technical assistance commitments 8,171 (2,409) Change in pension and postretirement benefit liability (259,835) (60,171) Others—net 26,441 (16,555)

Net Cash Provided by Operating Activities $ 886,349 $ 535,173

1 Supplementary disclosure of noncash financing activities: Nonnegotiable, noninterest-bearing demand promissory notes amounting to $2,726 ($2,738 - 2007) were received from members.


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STATEMENT OF CHANGES IN CAPITAL AND RESERVES For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Notes B and K)

Cumulative Accumulated Net Notional Revaluation Net Income Other Capital Maintenance Ordinary Special Loan Loss Adjustments After Comprehensive Stock of Value Reserve Reserve Reserve Surplus Account Appropriations Income Total

Balance- 1 January 2007 $3,652,800 $(672,899) $8,993,737 $197,799 $130,100 $330,117 $ 27,519 $565,886 $ (82,160) $13,142,899

Comprehensive income for the year 2007 (Note L) 765,223 260,140 1,025,363 Appropriation of guarantee fees to Special Reserve (Note L) 5,049 (5,049) –Change in SDR value of paid-in shares subscribed 185,667 185,667 Change in subscription installments not due (2,889) (2,889)Additional paid-in shares subscribed during the year 10,242 10,242 Change in SDR value of capital transferred to Asian Development Fund (3,527) (3,527)Change in notional maintenance of value (Note K) 11,702 11,702 Allocation of 2006 net income to ordinary reserve, loan loss reserve and surplus and transfer from cumulative revaluation account (Note L) 286,183 52,000 286,183 (138,479) (485,886) – Allocation of 2006 net income to ADF and RCIF (Note L) (80,000) (80,000)Charge to ordinary reserve for change in SDR value of capital stock (Note L) (34,587) (34,587)

Balance- 31 December 2007 $3,842,293 $(661,197) $9,245,332 $202,847 $182,100 $616,300 $(110,959) $760,174 $177,980 $14,254,870

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Cumulative Accumulated Net Notional Revaluation Net Income Other Capital Maintenance Ordinary Special Loan Loss Adjustments After Comprehensive Stock of Value Reserve Reserve Reserve Surplus Account Appropriations Income Total

Balance- 31 December 2007 $ 3,842,293 $ (661,197) $ 9,245,332 $ 202,847 $ 182,100 $ 616,300 $(110,959) $ 760,174 $177,980 $ 14,254,870

Cumulative effect of FAS 157/159 adoption 227,500 227,500 Comprehensive income for the year 2008 (Note L) 1,126,349 (276,701) 849,648 Appropriation of guarantee fees to Special Reserve (Note L) 6,876 (6,876) – Change in SDR value of paid-in shares subscribed (74,035) (74,035)Change in subscription installments not due 7,353 7,353 Change in SDR value of capital transferred to Asian Development Fund 1,460 1,460 Change in notional maintenance of value (Note K) 96,814 96,814 Allocation of 2007 net income to ordinary reserve, loan loss reserve and surplus and transfer to cumulative revaluation account (Note L) 278,294 12,962 278,294 87,623 (657,174) – Allocation of 2007 net income to ADF, TASF and CCF (Note L) (103,000) (103,000)Charge to ordinary reserve for change in SDR value of capital stock (Note L) 8,860 8,860

Balance- 31 December 2008 $3,777,071 $(564,383) $9,532,487 $209,723 $195,062 $894,594 $(23,336) $1,346,973 $(98,721) $15,269,470

Note: Figures may not add to total due to rounding.

Accumulated Other Comprehensive Income (Note L) For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollar (Note B)

Pension/ FAS 133 Accumulated Unrealized Postretirement Accumulated Other Adjustments and Translation Investment Liability Adjustment- Comprehensive Amortization Adjustments Holding Gains FAS 158 Income

2008 2007 2008 2007 2008 2007 2008 2007 2008 2007

Balance, 1 January $ (289) $ (1,154) $(113,385) $(200,039) $433,376 $200,584 $(141,722) $(81,551) $177,980 $(82,160)Amortization (669) 865 – – – – – – (669) 865 Other comprehensive income for the year – – (43,420) 86,654 27,223 232,792 (259,835) (60,171) (276,032) 259,275

Balance, 31 December $ (958) $ (289) $(156,805) $(113,385) $460,599 $433,376 $(401,557) $(141,722) $(98,721) $177,980


OCR-4

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SUMMARY STATEMENT OF LOANS 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

Undisbursed Loans Loans Balances of Not Yet Total Percent of Borrowers/Guarantors Outstanding1 Effective Loans2 Effective Loans Total Loans

Afghanistan $ 72,745 $ 31,667 $ – $ 104,412 0.18Azerbaijan 55,328 235,552 215,400 506,280 0.90Bangladesh 517,884 822,182 82,000 1,422,066 2.52Bhutan – – 51,000 51,000 0.09Cambodia 7,000 – – 7,000 0.01 China, People’s Rep. of 8,464,133 4,223,072 1,658,852 14,346,057 25.38Cook Islands – – 8,630 8,630 0.02Fiji Islands 94,832 24,565 – 119,397 0.21Georgia 25,000 – – 25,000 0.04India 6,453,809 4,289,109 1,563,480 12,306,398 21.77Indonesia 10,160,917 545,360 95,000 10,801,277 19.11Kazakhstan 216,529 25,128 390,000 631,657 1.12Korea, Rep. of 108,847 – – 108,847 0.19Lao People’s Dem. Rep. 62,743 7,257 – 70,000 0.12Malaysia 212,368 – – 212,368 0.38Maldives 1,500 10,500 – 12,000 0.02Marshall Islands 3,142 – – 3,142 0.01Micronesia, Fed. States of 101 4,699 – 4,800 0.01Mongolia 12,500 2,000 – 14,500 0.03Myanmar – – – – – Nauru 1,214 – – 1,214 0.00Nepal 16,929 – – 16,929 0.03Pakistan 4,345,421 2,003,171 599,300 6,947,892 12.29Papua New Guinea 123,821 113,878 – 237,699 0.42Philippines 3,891,694 171,821 490,000 4,553,515 8.06Sri Lanka 319,722 566,342 7,500 893,564 1.58Thailand 51,145 – – 51,145 0.09Uzbekistan 440,428 301,006 85,000 826,434 1.46Viet Nam 173,220 425,787 1,552,200 2,151,207 3.84

35,832,972 13,803,096 6,798,362 56,434,430 99.88Regional 18,000 14,500 32,500 65,000 0.12

TOTAL – 31 December 2008 35,850,972 13,817,596 6,830,862 56,499,430 100.00 Provision for loan losses (9,174) – – (9,174) Unamortized loan origination cost – net 68,262 – – 68,262

NET BALANCE – 31 December 2008 $35,910,060 $13,817,596 $6,830,862 $56,558,518

Made up of: Sovereign Loans $34,252,384 $13,099,342 $5,498,830 $52,850,556 Nonsovereign Loans Private Sector 1,573,676 718,254 1,032,032 3,323,962 Public Sector 84,000 – 300,000 384,000

Net balance – 31 December 2008 $35,910,060 $13,817,596 $6,830,862 $56,558,518

TOTAL – 31 December 2007 $30,255,792 $12,971,665 $6,039,610 $49,267,067 Provision for loan losses (15,043) – – (15,043) Unamortized front-end fee 42,130 – – 42,130

NET BALANCE – 31 December 2007 $30,282,879 $12,971,665 $6,039,610 $49,294,154

Made up of: Sovereign Loans $29,003,104 $12,814,137 $5,061,815 $46,879,056 Nonsovereign Loans Private Sector 1,248,775 113,528 797,795 2,160,098 Public Sector 31,000 44,000 180,000 255,000

Net balance – 31 December 2007 $30,282,879 $12,971,665 $6,039,610 $49,294,154

1 Amounts outstanding on the multicurrency fixed lending rate loans totaled $33,734 ($38,049 - 2007), on pool-based loans totaled $10,257,327 ($10,861,527 - 2007) and on LIBOR-based loans and market-based loans totaled $25,559,911 ($19,356,215 - 2007). The average yield on loans was 3.84% (5% - 2007).

2 Of the undisbursed balances, ADB has made irrevocable commitments to disburse various amounts totaling $333,541 ($361,280 - 2007).

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MATURITY OF EFFECTIVE LOANS

Twelve Months Five Years Ending Ending 31 December Amount 31 December Amount 2009 $ 1,987,970 2018 14,245,184 2010 2,370,739 2023 11,685,193 2011 2,641,966 2028 7,521,777 2012 2,935,736 2033 3,086,366 2013 3,152,033 over 2033 41,604 Total $49,668,568 3

SUMMARY OF CURRENCIES RECEIVABLE ON LOANS OUTSTANDING

Currency 2008 2007 Currency 2008 2007 Chinese yuan $ 83,098 $ 23,001 Kazakhstan tenge 39,727 49,776 Euro – 920 Pakistan rupee 131 –Japanese yen 5,566,126 4,607,011 Philippine peso 81,011 42,856 Indian rupee 190,354 143,024 Swiss franc 3,247 3,502 Indonesian rupiah 10,762 – United States dollar 29,876,516 25,385,702

Total $35,850,972 $30,255,792

3 Includes undisbursed commitment relating to Revolving Credit Facility of Trade Financing Facilitation Program amounting to $14,500.


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SUMMARY STATEMENT OF BORROWINGS 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

Borrowings Swap Arrangements2

Principal Outstanding1 Payable (Receivable)3

2008 2007 2008 2007

Australian dollar $ 6,010,372 $ 5,729,446 $ (6,094,769) $(5,463,460)Canadian dollar 1,327,790 1,526,591 (1,496,399) (1,521,721)Chinese yuan 145,574 136,909 28,805 14,363 (31,718) Euro 42,851 47,117 (45,899) (45,819)Hong Kong dollar 365,694 345,983 (367,466) (353,274)Indian rupee 100,867 126,791 26,779 16,384 (27,398) Japanese yen 3,639,786 4,607,002 4,472,977 2,706,761 (3,285,653) (3,220,956)Kazakhstan tenge 39,727 49,776 – –Malaysian ringgit 472,027 421,941 (447,571) (421,221)Mexican peso 121,615 155,913 (123,482) (153,378)New Taiwan dollar 153,801 146,437 (154,063) (146,437)New Zealand dollar 402,099 463,271 (413,403) (464,535)Philippine peso 150,736 168,824 3,584 (130,271) (121,092) Pound sterling 882,641 695,816 (767,883) (517,914)Singapore dollar 400,826 380,307 (404,681) (392,574)South African rand 2,469,917 1,850,334 (2,483,788) (1,742,132)Swiss franc 414,266 374,924 Thai baht 327,484 349,708 (329,481) (356,683)Turkish lira 1,416,566 474,746 (1,334,657) (483,611)United States dollar 16,787,230 13,517,474 20,335,670 14,199,456 (5,901,684) (2,554,881)

Subtotal 35,671,869 31,569,310 $ 1,036,728 $(1,031,903)

Unamortized discounts/ premiums and transition adjustments (31,372) 1,055ATAFAS 133 Adjustments

Total $35,640,497 $31,570,365

MATURITY STRUCTURE OF BORROWINGS OUTSTANDING5

Twelve Months Ending Five Years Ending 31 December Amount 31 December Amount

2009 6,877,509 2018 8,233,829 2010 6,723,106 2023 215,601 2011 4,981,028 2028 2,237,164 2012 3,262,047 2033 39,247 2013 3,102,338 over 2034 –

Total $35,671,869

1 Reported at Fair Value upon adoption of FAS 157/159 effective 1 January 2008, except for unswapped borrowings which are reported at net of principal amount and unamortized discount/premium of zero coupon bonds. The aggregate face amounts and discounted values of zero coupon and deep discount borrowings (in United States dollar equivalents) are:

Aggregate Face Amount Discounted Value

2008 2007 2008 2007 Australian dollar $1,188,688 $1,506,016 $1,040,308 $1,258,707 Canadian dollar 657,516 814,913 554,656 660,746 Philippine peso 52,615 60,643 44,914 47,538 South African rand 386,809 161,672 305,381 125,014 Swiss franc 461,212 434,223 320,561 286,703 Turkish lira 712,080 255,334 552,518 217,699 United States dollar 1,898,326 1,977,963 1,445,211 1,229,074

2 Include currency and interest rate swaps. At 31 December 2008, the remaining maturity of swap agreements ranged from less than one year to 35 years. Ap-proximately 81.57% of the swap receivables and 87.29% of the payables are due before 1 January 2014.

3 Adjusted by the cumulative effect of the adoption of FAS 133 effective 1 January 2001.

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OCR-6

Net Currency Obligation3 Weighted Average

2008 2007 Cost (%) After Swaps4

$ (84,397) $ 265,986 (11.75) (168,609) 4,870 3.67 142,661 151,272 4.43

(3,048) 1,298 0.63 (1,772) (7,291) 0.18 100,248 143,175 7.39

4,827,110 4,092,807 1.18

39,727 49,776 6.69 24,456 720 0.47 (1,867) 2,535 0.05 (262) – 0.10 (11,304) (1,264) (6.50) 33,228 38,553 3.11

114,758 177,902 11.80 (3,855) (12,267) 1.93 (13,871) 108,202 3.88 414,266 374,924 5.33 (1,997) (6,975) 30.17 81,909 (8,865) (0.06) 31,221,216 25,162,049 3.62

$ 36,708,597 $ 30,537,407 3.32

2.54 (1.75)

4.11

INTEREST RATE SWAP ARRANGEMENTS Average Rate (%)

Notional Receive Pay Amount Fixed Floating6 Maturing Through7

Receive Fixed Swaps: Australian dollar8 $ 55,350 2.64 0.66 2027-2032 Chinese yuan 146,299 3.34 4.26 2015 Euro9 110,699 4.40 3.62 2010 Indian rupee 103,167 5.40 7.77 2014 Philippine peso 34,362 4.92 2010 United States dollar 11,151,658 3.51 2.64 2009-2043 United States dollar10 55,350 2.14 0.60 2016-2027

Receive Floating Swaps: Japanese yen 742,237 0.88 0.62 0.59 2009-2032 United States dollar 1,000,000 1.91 2.82 2011

Total $13,399,122

4 Calculation is based on average carry book value of borrowings net of fair value of swaps. Thus, the weighted average cost may be negative if the related swaps payable exposure is in a different currency and the fair value of swaps receivable exceeds the carry book value of borrowings.

5 Bonds with put and call options were considered maturing on the first put or call date. 6 Represent average current floating rates, net of spread. 7 Swaps with early termination date were considered maturing on the first termination date. 8 Consists of dual currency swaps with interest receivable in Australian dollar and interest payable in Japanese yen. 9 Consists of dual currency swap with interest receivable in Euro and interest payable in Japanese yen. 10 Consists of dual currency swaps with interest receivable in United States dollar and interest payable in Japanese yen. The accompanying notes are an integral part of these financial statements (OCR-8).

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STATEMENT OF SUBSCRIPTIONS TO CAPITAL STOCK AND VOTING POWER 31 December 2008Expressed in Thousands of United States Dollars (Note B)

SUBSCRIBED CAPITAL VOTING POWER

Number of Percent Par Value Of Shares Number of Percent MEMBERS Shares of Total Total Callable Paid-in Votes of Total

REGIONAL Afghanistan 1,195 0.034 $ 18,496 $ 12,584 $ 5,913 14,427 0.325 Armenia 10,557 0.298 163,402 151,918 11,485 23,789 0.537 Australia 204,740 5.773 3,168,986 2,947,061 221,925 217,972 4.917 Azerbaijan 15,736 0.444 243,563 226,429 17,134 28,968 0.653 Bangladesh 36,128 1.019 559,193 520,033 39,160 49,360 1.114 Bhutan 220 0.006 3,405 3,049 356 13,452 0.303 Brunei Darussalam 12,462 0.351 192,888 179,329 13,559 25,694 0.580 Cambodia 1,750 0.049 27,087 22,474 4,612 14,982 0.338 China, People’s Rep. of 228,000 6.429 3,529,007 3,281,806 247,201 241,232 5.442 Cook Islands 94 0.003 1,455 1,362 93 13,326 0.301 Fiji Islands 2,406 0.068 37,240 34,625 2,616 15,638 0.353 Georgia 12,081 0.341 186,991 173,850 13,141 25,313 0.571 Hong Kong, China 19,270 0.543 298,263 277,368 20,895 32,502 0.733 India 224,010 6.317 3,467,249 3,224,444 242,805 237,242 5.352 Indonesia 192,700 5.434 2,982,630 2,773,768 208,861 205,932 4.646 Japan 552,210 15.571 8,547,162 7,948,593 598,569 565,442 12.756 Kazakhstan 28,536 0.805 441,683 410,742 30,941 41,768 0.942 Kiribati 142 0.004 2,198 2,043 155 13,374 0.302 Korea, Republic of 178,246 5.026 2,758,909 2,565,727 193,182 191,478 4.320 Kyrgyz Republic 10,582 0.298 163,789 152,320 11,469 23,814 0.537 Lao PDR 492 0.014 7,615 6,795 820 13,724 0.310 Malaysia 96,350 2.717 1,491,315 1,386,869 104,446 109,582 2.472 Maldives 142 0.004 2,198 2,043 155 13,374 0.302 Marshall Islands 94 0.003 1,455 1,362 93 13,326 0.301 Micronesia, Fed. States of 142 0.004 2,198 2,043 155 13,374 0.302 Mongolia 532 0.015 8,234 7,662 573 13,764 0.310 Myanmar 19,270 0.543 298,263 277,368 20,895 32,502 0.733 Nauru 142 0.004 2,198 2,043 155 13,374 0.302 Nepal 5,202 0.147 80,517 74,868 5,650 18,434 0.416 New Zealand 54,340 1.532 841,080 782,186 58,894 67,572 1.524 Pakistan 77,080 2.174 1,193,052 1,109,501 83,551 90,312 2.037 Palau 114 0.003 1,765 1,641 124 13,346 0.301 Papua New Guinea 3,320 0.094 51,387 47,812 3,575 16,552 0.373 Philippines 84,304 2.377 1,304,866 1,213,499 91,367 97,536 2.200 Samoa 116 0.003 1,795 1,610 186 13,348 0.301 Singapore 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Solomon Islands 236 0.007 3,653 3,405 248 13,468 0.304 Sri Lanka 20,520 0.579 317,611 295,369 22,242 33,752 0.761 Taipei,China 38,540 1.087 596,526 554,766 41,760 51,772 1.168 Tajikistan 10,134 0.286 156,855 145,819 11,036 23,366 0.527 Thailand 48,174 1.358 745,642 693,419 52,223 61,406 1.385 Timor-Leste 350 0.010 5,417 5,030 387 13,582 0.306 Tonga 142 0.004 2,198 2,043 155 13,374 0.302 Turkmenistan 8,958 0.253 138,653 128,902 9,751 22,190 0.501 Tuvalu 50 0.001 774 712 62 13,282 0.300 Uzbekistan 23,834 0.672 368,905 343,072 25,833 37,066 0.836 Vanuatu 236 0.007 3,653 3,405 248 13,468 0.304 Viet Nam 12,076 0.341 186,914 165,476 21,437 25,308 0.571

Total Regional (Forward) 2,247,995 63.390 34,794,691 32,341,552 2,453,140 2,883,131 65.040

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SUBSCRIBED CAPITAL VOTING POWER

Number of Percent Par Value Of Shares Number of Percent MEMBERS Shares of Total Total Callable Paid-in Votes of Total

Total Regional (Forward) 2,247,995 63.390 34,794,691 32,341,552 2,453,140 2,883,131 65.040

NONREGIONAL Austria 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Belgium 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Canada 185,086 5.219 2,864,780 2,664,168 200,612 198,318 4.474 Denmark 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Finland 12,040 0.340 186,356 173,308 13,048 25,272 0.570 France 82,356 2.322 1,274,714 1,185,437 89,278 95,588 2.156 Germany 153,068 4.316 2,369,202 2,203,277 165,925 166,300 3.752 Ireland 12,040 0.340 186,356 173,246 13,110 25,272 0.570 Italy 63,950 1.803 989,824 920,498 69,326 77,182 1.741 Luxembourg 12,040 0.340 186,356 173,246 13,110 25,272 0.570 The Netherlands 36,294 1.023 561,762 522,432 39,330 49,526 1.117 Norway 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Portugal 12,040 0.340 186,356 173,246 13,110 25,272 0.570 Spain 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Sweden 12,040 0.340 186,356 173,308 13,048 25,272 0.570 Switzerland 20,650 0.582 319,623 297,226 22,397 33,882 0.764 Turkey 12,040 0.340 186,356 173,308 13,048 25,272 0.570 United Kingdom 72,262 2.038 1,118,478 1,040,159 78,319 85,494 1.929 United States 552,210 15.571 8,547,162 7,948,593 598,569 565,442 12.756

Total Nonregional 1,298,316 36.610 20,095,465 18,687,995 1,407,470 1,549,724 34.960

TOTAL 3,546,311 100.000 $54,890,156 $51,029,546 $3,860,610 4,432,855 100.000

Note: Figures may not add due to rounding.


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NOTES TO FINANCIAL STATEMENTS31 December 2008 and 2007

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NOTE A—NATURE OF OPERATIONS AND LIMITATIONS ON LOANS, GUARANTEES AND EQUITY INVESTMENTS

Nature of Operations

The Asian Development Bank (ADB), a multilateral de-

velopment financial institution, was established in 1966

with its headquarters in Manila, Philippines. ADB and its

operations are governed by the Agreement Establishing

the Asian Development Bank (the Charter). Its purpose

is to foster economic development and co-operation in

the Asian and Pacific region and to contribute to the

acceleration of the process of economic development

of the developing member countries (DMCs) in the

region, collectively and individually. With the adoption

of its poverty reduction strategy at the end of 1999,

ADB made reducing poverty in the region its main goal.

ADB provides financial and technical assistance (TA) for

projects and programs, which will contribute to achieving

this purpose.

Mobilizing financial resources, including

cofinancing, is an integral part of ADB's operational

activities. In addition, ADB, alone or jointly, administers

on behalf of donors, including members, their agencies

and other development institutions, funds restricted for

specific uses, which include TA grants as well as regional

programs.

ADB's ordinary operations comprise loans, equity

investments, and guarantees. During the years 2001 and

2002, limited technical assistance to member countries

to support high priority TA programs was included. ADB

finances its ordinary operations through borrowings,

paid-in capital, and reserves.

Limitations on Loans, Guarantees, and Equity Investments

Article 12, paragraph 1 of the Charter provides that the

total amount outstanding of loans, equity investments,

and guarantees made by ADB shall not exceed the total

of ADB's unimpaired subscribed capital, reserves, and

surplus, exclusive of the special reserve. In December

2008, the Board of Directors approved the revised pol-

icy on ADB’s lending limitations, which limits the total

amount of disbursed loans, approved equity investments,

and the maximum amount that could be demanded from

ADB under its guarantee portfolio, to the total amount

of ADB's unimpaired subscribed capital, reserves and

surplus. At 31 December 2008 and 2007, the total of such

loans, equity investments, and guarantees aggregated

approximately 55.7% and 46.9%, respectively, of the

total subscribed capital, reserves, and surplus as defined,

based on this new policy.

Article 12, paragraph 3 of the Charter provides

that equity investments shall not exceed 10% of the

unimpaired paid-in capital together with reserves

and surplus, exclusive of the special reserve. At 31

December 2008, such equity investments represented

approximately 6.1% (7.6% - 2007) of the paid-in capital,

reserves, and surplus, as defined.

NOTE B—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Functional Currencies and Reporting Currency

The currencies of members are all functional currencies

as these are the currencies of the primary economic envi-

ronment in which ADB generates and expends cash. The

reporting currency is the United States dollar (USD).

Translation of Currencies

ADB adopts the use of daily exchange rates for account-

ing and financial reporting purposes. This allows transac-

tions in currencies other than USD to be translated to

the reporting currency using exchange rates applicable at

the time of transactions. At the end of each accounting

month, translations of assets, liabilities, capital, and re-

serves denominated in non-USD are adjusted using the

applicable rates of exchange at the end of the reporting

period. These translation adjustments, other than those

relating to the non-functional currencies (Note M) and

to the maintenance of Special Drawing Right (SDR)

capital values (Notes K and L), are charged or credited to

“Accumulated translation adjustments” and reported in

“CAPITAL AND RESERVES” as part of “Accumulated

other comprehensive income.”

Valuation of Capital Stock

The authorized capital stock of ADB is defined in Article

4, paragraph 1 of the Charter “in terms of United States

dollars of the weight and fineness in effect on 31 January

1966” (the 1966 dollar) and the value of each share is

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defined as 10,000 1966 dollars. The capital stock had his-

torically been translated into the current United States

dollar (ADB's unit of account) on the basis of its par value

in terms of gold. From 1973 until 31 March 1978, the rate

arrived at on this basis was $1.20635 per 1966 dollar. Since

1 April 1978, at which time the Second Amendment to

the Articles of Agreement of the International Monetary

Fund (IMF) came into effect, currencies no longer have

par values in terms of gold. Pending ADB's selection of

the appropriate successor to the 1966 dollar, the capital

stock has been valued for purposes of these financial

statements in terms of the SDR at the value in current

United States dollars as computed by the IMF, with each

share valued at SDR10,000.

As of 31 December 2008, the value of the SDR in

terms of the current United States dollar was $1.54781

($1.57848 – 2007) giving a value for each share of ADB's

capital equivalent to $15,478.10 ($15,784.80 – 2007).

However, ADB could decide to fix the value of each share

at $12,063.50 based on the 31 March 1978 par value of

the United States dollar in terms of gold.

Derivative Financial Instruments

ADB reports all derivative transactions in accordance

with Statement of Financial Accounting Standards

(FAS) No. 133, “Accounting for Derivative Instruments

and Hedging Activities,” along with its amendments,

collectively referred as FAS 133. FAS 133 requires that

derivative instruments be recorded in the Balance Sheet

as either assets or liabilities measured at fair value. The

initial application of FAS 133 in January 2001 gave rise to

a transition loss of $81,657,000 in other comprehensive

income and a gain of $34,656,000 was reported in net

income. The amount recorded in other comprehensive

income as transition loss is being reclassified into earn-

ings in the same period or periods in which the underlying

transactions affect earnings.

In applying FAS 133 for purposes of financial

statement reporting, ADB has elected not to define any

qualifying hedging relationships. Rather, all derivative

instruments, as defined by FAS 133, have been marked

to fair value, and all changes in fair value have been

recognized in net income. ADB has elected not to

define any qualifying hedging relationships, not because

economic hedges do not exist, but rather because the

application of FAS 133 hedging criteria does not make

fully evident ADB’s risk management strategies.

In February 2006, the Financial Accounting

Standards Board issued FAS 155, “Accounting for Certain

Hybrid Financial Instruments, an amendment of FASB

Statements No. 133 and 140.” ADB decided to early adopt

the provisions which allow hybrid financial instruments

that contain embedded derivatives requiring bifurcation

under FAS 133 to be measured at fair value, effective 1

January 2006. With this, FAS 133 as presented in ADB’s

financial statements incorporates the provisions of FAS

155.

ADB issues hybrid instruments, i.e. structured

debts, to lower its cost of borrowings, which are generally

fully hedged through derivative transactions. ADB

measures and reports any of its qualified bifurcable

structured debts and their corresponding derivatives at

fair value with changes in fair value recognized in net

income. This consistent accounting treatment would

fully capture the economic hedging relationship between

the hybrid instruments and their derivatives.

Investments

All investment securities and negotiable certificate of

deposits held by ADB other than derivative instruments

are considered by Management to be “Available for

Sale” and are reported at estimated fair value, which

represents their fair market value. Time deposits are

reported at cost, which is a reasonable estimate of

fair value. Unrealized gains and losses are reported in

“CAPITAL AND RESERVES” as part of “Accumulated

other comprehensive income.” Realized gains and

losses are included in income from investments and are

measured by the difference between amortized cost

and the net proceeds of sales. With respect to exchange

traded futures, realized gains or losses are reported based

on daily settlement of the net cash margin.

Interest income on investment securities and time

deposits is recognized as earned and reported, net of

amortizations of premiums and discounts.

Unrealized losses on investment securities are

assessed to determine whether the impairment is

deemed to be other than temporary. If the impairment

is deemed to be other than temporary, the investment is

written down to the impaired value, which becomes the

new cost basis of the investments. Impairment losses are

not reversed for subsequent recoveries in the value of

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Securities Transferred Under Repurchase Agreement and Securities Purchased Under Resale Arrangement

ADB accounts for transfers of financial assets in ac-

cordance with FAS 140, “Accounting for Transfers and

Servicing of Financial Assets and Extinguishments

of Liabilities - a replacement of FAS 125.” In general,

transfers are accounted for as sales when control over

the transferred assets has been relinquished. Otherwise

the transfers are accounted for as repurchase/resale

agreements and collateralized financing arrangements.

Under repurchase agreements, securities transferred are

recorded as assets and reported at estimated fair value

and cash collateral received are recorded as liabilities.

ADB monitors the fair value of the securities transferred

under repurchase agreements and the collateral. Under

resale arrangements, securities purchased are recorded

as assets, while securities received are not recorded as

liabilities and are not re-pledged. All outstanding securi-

ties as of 31 December 2008 and 2007 classified under

securities transferred under repurchase agreement cor-

rectly reflect the nature of the transactions.

Loans

ADB's loans are made to or guaranteed by members, with

the exception of nonsovereign loans, and have maturities

ranging between 3 and 32 years. ADB requires its borrow-

ers to absorb exchange risks attributable to fluctuations

in the value of the currencies which it has disbursed.

Loan interest income and loan commitment fees are

recognized on accrual basis. In line with ADB's principle

of cost pass through pricing, any variation in the actual

cost of borrowings is passed to LIBOR-based borrowers

as surcharge or rebate.

It is the policy of ADB to place loans in non-accrual

status for which principal, interest, or other charges

are overdue by six months. Interest and other charges

on non-accruing loans are included in income only to

the extent that payments have been received by ADB.

ADB maintains a position of not taking part in debt

rescheduling agreements with respect to sovereign loans.

In the case of nonsovereign loans, ADB may agree to debt

rescheduling only after alternative courses of action have

been exhausted.

ADB determines that a loan is impaired and

therefore subject to provisioning when principal or

interest is in arrears for one year for sovereign loans

(unless there is clear and convincing evidence warranting

the deferment or acceleration of such provisioning) and

six months for nonsovereign loans. If the present value

of expected future cash flows discounted at the loan’s

effective interest rate is less than the carrying value

of the loan, a valuation allowance is established with a

corresponding charge to provision for loan losses.

ADB’s periodic evaluation of the adequacy of the

provision for loan losses is based on its past loan loss

experience, known and inherent risks in existing loans,

and adverse situations that may affect a borrower’s ability

to repay.

In December 2006, the Board approved the

application of the concept of expected loss for

nonsovereign credit exposure to establish loss provision

and loss reserve, the same concept that was applied to

sovereign operations in 2004. In line with accounting

principles generally accepted in the United States of

America, the amount of expected loss pertaining to

credit exposures that are impaired and rated substandard

or worse is charged to the income statement, following

the discounted cash flow method described above, while

those that are better are recorded as loss reserve in the

equity section of the balance sheet. Any adjustment

to loan loss reserve following this new methodology is

subject to the approval of the Board of Governors.

Effective 2000, ADB levies front-end fees on all new

sovereign loans. These fees are deferred and amortized

over the life of the loans after offsetting deferred direct

loan origination costs. In 2004, ADB waived the entire

front-end fee on all new sovereign loans approved during

the year. Subsequently, the policy was extended to

cover the period up to June 2009. In December 2007,

the Board approved the elimination of front-end fees on

sovereign LIBOR-based loans negotiated on and after 1

October 2007.

ADB levies a commitment charge on the

undisbursed balance of effective loans. Unless otherwise

provided by the loan agreement, the charges take effect

commencing on the 60th day after the loan signing date

and are credited to loan income.

Guarantees

ADB extends guarantees to sovereign and nonsovereign

borrowers. Guarantees are regarded as outstanding when

the underlying financial obligation of the borrower is

incurred. ADB would be required to perform under its

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guarantees if the payments guaranteed were not made

by the debtor, and the guaranteed party called the guar-

antee by demanding payments from ADB in accordance

with the term of the guarantee.

Prior to 1 January 2003, guarantees in the absence

of any call, were not reflected in the financial statements

but disclosed as a note to the financial statements (Note F) in accordance with the provisions of FASB No. 5,

Accounting for Contingencies. FASB Interpretation No.

45 (FIN 45), “Guarantor’s Accounting and Disclosure

Requirements for Guarantees, Including Indirect

Guarantees of Indebtedness to Others,” which came

into effect in 2003, requires the recognition of two types

of liabilities that are associated with guarantees: (a)

the stand-by ready obligation to perform, and (b) the

contingent liability. ADB recognizes at the inception

of a guarantee, a liability for the stand-by ready

obligation to perform on guarantees issued and modified

after 31 December 2002. The liability is included in

“Miscellaneous liabilities.”

Front-end fee income on guarantees received is

deferred and amortized over the term of the guarantee

contract and the unamortized balance of deferred front-

end fee of guarantee is included in “Miscellaneous

liabilities.”

Equity Investments

All equity investments are considered as “Available for

Sale” and are reported at estimated fair value.

Investments in equity securities with readily

determinable market price are reported at fair value,

with unrealized gains and losses reported in “CAPITAL

AND RESERVES” as part of “Accumulated other

comprehensive income.”

Investments in equity securities without readily

determinable fair values are reported at cost or at

impaired value, for investments where the impairment

is deemed other than temporary. These investments

are assessed each quarter to reflect the amount that

can be realized using valuation techniques appropriate

to the market and industry of each investment. When

impairment is identified and is deemed to be other than

temporary, the equity investment is written down to the

impaired value, which becomes the new cost basis of the

equity investments. Impairment losses are not reversed

for subsequent recoveries in the value of the equity

investments, until it is sold.

ADB applies the equity method of accounting to

investments in limited liability partnerships (LLPs) and

certain limited liability companies (LLCs) that maintain

a specific ownership account for each investor.

Variable Interest Entities

ADB complies with FIN 46R, “Consolidation of Variable

Interest Entities – an interpretation of ARB No. 51,

Consolidated Financial Statements.” FIN 46 requires an

entity to consolidate and provide disclosures for any VIE

for which it is the primary beneficiary. An entity that will

absorb a majority of VIE’s expected losses or receive a

majority of expected residual return is deemed to be the

primary beneficiary of the VIE. Variable interests can arise

from equity investments, loans, and guarantees. ADB is

required to disclose information about its involvement in

VIE where ADB holds significant variable interest (Note

S).

Property, Furniture, and Equipment

Property, furniture, and equipment are stated at cost

and, except for land, depreciated over estimated useful

lives on a straight-line basis. Maintenance, repairs, and

minor betterments are charged to expense.

Borrowings

Borrowings are generally reported on the balance sheet at

their carrying book value, adjusted for any unamortized

discounts or premium. As part of its borrowing strat-

egy, ADB issues various types of contractual obligations,

which include structured debts containing embedded

derivatives in order to minimize the cost of borrowings.

ADB simultaneously enters into currency and/or interest

rate swaps to fully hedge the debt.

Upon the adoption of FAS 155 on 1 January 2006,

ADB no longer bifurcates and fair values the embedded

derivatives (the debt was valued at its carrying book

value) in the structured debt portfolio that meet the

bifurcation criteria under FAS 133. Instead, ADB

measures and reports at fair value any structured debt

that contains embedded derivatives that would otherwise

be bifurcated under FAS 133 as a whole, with changes in

fair value reported in net income.

Effective 1 January 2008, ADB adopted the

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swapped. Further information relating to the adoption of

FAS 159 and the reasons for electing FAS 159 for these

financial instruments are discussed in detail in Note P.

Borrowing valuations are further adjusted for the credit

spread by currency.

Accounting Estimates

The preparation of the financial statements in con-

formity with generally accepted accounting principles

requires Management to make reasonable estimates and

assumptions that affect the reported amounts of assets

and liabilities and disclosure of contingent liabilities at

the end of the year and the reported amounts of revenues

and expenses during the year. The actual results could

differ from those estimates.

Accounting and Reporting Developments

Effective 1 January 2008, ADB adopted FAS 157 and FAS

159. FAS 157 defines fair value (FV) which focuses on the

price that would be received to sell the asset or paid to

transfer the liability (exit price) and establishes a frame-

work for measuring FV through a FV hierarchy that ranks

the quality and reliability of the data used in FV measure-

ments. FAS 159 expands the scope of financial instruments

that may be carried at FV. It offers an irrevocable option to

carry the majority of financial assets and liabilities at FV,

on an instrument-by-instrument basis, with changes in FV

recognized in earnings. Fair Value Option may be elected

at the time an entity recognizes an eligible financial asset

or liability. FAS 159 also allows a one time election for

existing financial assets and liabilities, on an instrument-

by-instrument basis, at the initial adoption date. The

adoption of FAS 157 and 159 was applied prospectively

and the cumulative effect of changes in valuation of the

financial assets and liabilities for which the Fair Value

Option have been elected were reported as an adjustment

to the 1 January 2008 balance of reserves.


Board (FASB) issued Statement No. 161 “Disclosures

about Derivative Instruments and Hedging Activities

– an amendment of FASB Statement No. 133,” which

will be applicable for fiscal years beginning after 15

November 2008 and interim periods within those

fiscal years. This statement amends and expands the

disclosure requirements of FAS 133 to provide users

with better understanding of (i) how and why an entity

uses derivatives; (ii) how derivative instruments and

related hedged items are accounted for under FAS 133

and its related interpretations; and (iii) how derivative

instruments and hedged items affect an entity’s financial

position, performance, and cash flows. ADB is currently

assessing the impact of this standard on its financial

statements.

In December 2008, the FASB issued FASB Staff

Position (FSP) FAS 132(R)-1, which amends 132(R)

to require more detailed disclosures about employers'

plan assets, including employers' investment strategies,

major categories of plan assets, concentration of risk

within plan assets, and valuation techniques used to

measure the fair value of plan assets. This aims to

address financial statement users' concerns “about the

lack of transparency surrounding the types of assets and

associated risks in an employer's defined benefit pension

or other postretirement plan and events in the economy

and markets that could have a significant effect on the

value of the plan assets.” An entity must provide the

FSP's disclosures in financial statements for fiscal years

ending after 15 December 2009.

Statement of Cash Flows

For the purposes of the Statement of Cash Flows, ADB

considers that its cash and cash equivalents are limited

to “DUE FROM BANKS.”

Reclassification

Certain non-material reclassifications of prior year’s

amounts and information have been made to conform to

the current year’s presentation.

NOTE C—RESTRICTIONS ON USE OF CURRENCIES AND DEMAND OBLIGATIONS OF MEMBERS

In accordance with Article 24, paragraph 2(i) of the Charter,

the use by ADB or by any recipient from ADB of certain

currencies may be restricted by members to payments for

goods or services produced and intended for use in their

territories. With respect to the currencies of 42 DMCs

for 2008 (44 - 2007), cash in banks (due from banks) and

demand obligations totaling $70,095,000 ($65,915,000

– 2007) and $144,515,000 ($174,805,000 – 2007), respec-

tively, may be, but are not currently so restricted.

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In accordance with Article 24, paragraphs 2(i)

and (ii) of the Charter, one member (one - 2007) has

restricted the use by ADB or by any recipient from ADB

of its currency to payments for goods or services produced

in its territory. As such, cash in banks (due from banks)

and investments totaling $20,000 ($20,000 - 2007) and

$3,182,000 ($3,082,000 - 2007), respectively, have been

restricted. None of the demand obligations held by ADB

in 2008 and in 2007 was restricted.

NOTE D—INVESTMENTS

The main investment management objective is to main-

tain security and liquidity. Subject to these parameters,

ADB seeks the highest possible return on its investments.

Investments are governed by the Investment Authority

approved by the Board of Directors in 1999, and reviewed

in 2006. The review endorsed a portfolio strategy that is

largely consistent with the 1999 approach.

ADB may purchase and sell exchange traded financial

futures and option contracts, and enter into currency

and interest rate swaps, and forward rate agreements.

Exposure to interest rate risk may be adjusted within

defined bands to reflect changing market conditions.

These adjustments are made through the purchase and

sale of securities, and financial futures. Accordingly,

financial futures are held for risk management purposes.

At 31 December 2008, the notional amount of outstanding

purchase and sales futures contracts were $6,300,000 and

$7,000,000, respectively, ($99,300,000 and $54,200,000,

respectively – 2007).

Included in “Other securities” as of 31 December

2008 were corporate bonds and other obligations of banks

amounting to $6,688,083,000 ($2,622,373,000 – 2007)

and asset/mortgage-backed securities of $758,066,000

($838,716,000 – 2007).

The currency compositions of the investment

portfolio as of 31 December 2008 and 2007 expressed in

United States dollars are as follows:

Currency 2008 2007

Australian dollar $ 412,599,000 $ 462,654,000 Canadian dollar 261,180,000 306,592,000 Euro 898,121,000 854,590,000 Japanese yen 1,277,485,000 928,670,000 Pound sterling 208,158,000 288,721,000 Swiss franc 463,590,000 457,381,000 United States dollar 11,407,590,000 9,480,057,000 Others 483,796,000 518,278,000

Total $15,412,519,000 $13,296,943,000

The estimated fair value and amortized cost of the

investments by contractual maturity at 31 December

2008 are as follows:

Estimated Amortized Fair Value Cost Due in one year or less $ 6,119,336,000 $ 6,100,549,000 Due after one year through five years 6,802,245,000 6,595,104,000 Due after five years through ten years 2,490,938,000 2,393,526,000 Total $15,412,519,000 $15,089,179,000

Additional information relating to investments in

government and government-guaranteed obligations

and other securities are as follows:

2008 2007 As of 31 December:Amortized cost $13,607,809,000 $5,770,063,000 Estimated fair value 13,931,149,000 5,805,057,000 Gross unrealized gains 364,824,000 60,811,000 Gross unrealized losses (41,484,000) (25,817,000) For the years ended 31 December: Change in net unrealized gains from prior year 288,346,000 76,994,000 Proceeds from sales 7,979,848,000 8,205,482,000 Gross gain on sales 53,508,000 13,466,000 Gross loss on sales (81,408,000) (19,411,000)




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As of 31 December 2008, gross unrealized losses

amounted to $41,484,000 ($25,817,000 – 2007) from

government and government-guaranteed obligations,

corporate bonds, and mortgage/asset-backed securities.

One government and government-guaranteed obligation

(12 – 2007), five corporate obligations (32 - 2007), and 11

mortgage/asset-backed securities (75 – 2007) sustained

unrealized losses for over one year, representing 3.70%

(9.34% - 2007) of the total investments. Comparative

details for 2008 and 2007 are as follows:

One year or less Over one year Total

For the year 2008 Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses

Government and government - guaranteed obligations $ 67,243,000 $ 215,000 $ 239,844,000 $ 897,000 $ 307,087,000 $ 1,112,000 Corporate bonds 546,087,000 6,431,000 320,160,000 2,552,000 866,247,000 8,983,000 Mortgage/Asset-backed securities 255,292,000 23,525,000 10,241,000 7,864,000 265,533,000 31,389,000

Total $868,622,000 $30,171,000 $ 570,245,000 $11,313,000 $1,438,867,000 $41,484,000



Government and government- guaranteed obligations $290,291,000 $ 5,814,000 $ 460,364,000 $ 6,816,000 $ 750,655,000 $12,630,000 Corporate bonds 507,085,000 3,835,000 627,532,000 3,301,000 1,134,617,000 7,136,000 Mortgage/Asset-backed securities 119,347,000 2,980,000 153,954,000 3,021,000 273,301,000 6,001,000 Options 300,000 50,000 – – 300,000 50,000

Total $917,023,000 $12,679,000 $1,241,850,000 $13,138,000 $2,158,873,000 $25,817,000

Asset/Mortgage-backed Securities: Asset/Mortgage-

backed securities are instruments whose cash flow is

based on the cash flows of a pool of underlying assets or

mortgage loans managed by a trust.

Exchange Traded Futures: Futures are contracts

for delayed delivery of securities or money market

instruments in which the seller agrees to make delivery

at a specified future date of a specified instrument at a

specified price or yield. Initial margin requirements are

met with cash or securities, and changes in the market

prices are generally settled daily in cash. ADB generally

closes out open positions prior to maturity. Therefore,

cash receipts or payments are limited to the change in

market value of the future contracts. As of 31 December

2008, net receipts on future contracts amounted to

$1,082,000 ($372,000 net payments – 2007).

NOTE E—LOANS

Loans

ADB does not sell its sovereign loans, nor does it believe

there is a market for its sovereign loans. The estimated

fair value of all loans is based on the estimated cash flows

from principal repayments, interest and other charges

discounted at the applicable market yield curves for

ADB’s borrowing cost plus lending spread.

The carrying amount and estimated fair value of

loans outstanding at 31 December 2008 and 2007 are as

follows:

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Prior to 1 July 1986, the lending rate of ADB was

based on a multicurrency fixed lending rate system under

which loans carried interest rates fixed at the time of loan

approval for the entire life of the loans. Effective 1 July

1986, ADB adopted a multicurrency pool-based variable

lending rate system. In addition, in July 1992, ADB

introduced a United States dollar pool-based variable

lending rate system, and in November 1994, a market-

based lending rate system was made available to financial

intermediaries of sovereign and nonsovereign borrowers.

The outstanding balances of pool-based

multicurrency loans were subsequently transformed

into pool-based single currency loans in Japanese yen,

effective 1 January 2004.

Commencing 1 July 2001, ADB offered LIBOR-based

loans (LBLs) in the following currencies – Euro, Japanese

yen, and United States dollar. The LBL lending facility offers

borrowers the flexibility of (i) choice of currency and interest

rate basis; (ii) change the original loan terms (currency and

interest rate basis) at any time during the life of the loan;

and (iii) options to cap or collar the floating lending rate at

any time during the life of the loan. With the introduction

of LBLs, all other loan windows are no longer offered to

borrowers. In November 2002, ADB offered local currency

loans (LCLs) to nonsovereign borrowers. In August 2005,

ADB also offered LCLs to sovereign borrowers. In November

2006, ADB introduced series of enhancements to sovereign

LBLs negotiated after 1 January 2007, offering additional

major currencies that ADB can efficiently intermediate, and

additional repayment options including (i) annuity method

with various discount factors, (ii) straight-line repayment,

(iii) bullet repayment, and (iv) custom-tailored repayment.

In 2008, ADB received prepayments for 11 loans

(6 loans – 2007) amounting to $277,053,000 ($80,139,000

– 2007) and collected prepayment premiums of $3,937,000

($210,000 - 2007). Ninety percent of the prepaid amounts in

2008 were pool-based single currency US dollar and Japanese

yen loans compared to 87% for pool-based single currency US

dollar loans in 2007.

Loan Charges

Since 1988, ADB has charged front-end fees for non-

sovereign loans. Effective 1 January 2000, ADB levied

front-end fee of 1% for sovereign loans for which the loan

negotiations are completed after that date. In addition, a

flat commitment fee of 0.75% was charged for new pro-

gram loans and a progressive commitment fee of 0.75%

was maintained for project loans. Effective 1 January

2000, the lending spread applied to all outstanding pool-

based sovereign loans and new sovereign market-based

loans was increased from 0.4% to 0.6%.

In 2004, the Board approved the waiver of the

entire 1% front-end fee on all new sovereign loans

approved during 1 January 2004 to 30 June 2005 (waiver

of 50 basis points on sovereign loans approved in 2003)

and waiver of 20 basis points of the lending spread on

sovereign loans outstanding from 1 July 2004 – 30 June

2005 for borrowers that do not have loans in arrears.

Subsequently, the policy was extended to cover the

period up to June 2009.

The front-end fees received on nonsovereign loans

for the year ended 31 December 2008 were $10,987,000

($4,576,000 – 2007). Administrative expenses relating to

direct loan origination of $35,540,000 for the year ended

31 December 2008 ($34,080,000 – 2007) were deferred

and offset against front-end fees received. The excess, if

any, is amortized over the life of each loan.

In November 2006, the Board approved a change in

the commitment charge policy for all sovereign project

2008 2007

Carrying Estimated Carrying Estimated Value Fair Value Value Fair Value

Fixed rate multicurrency loans $ 22,246,000 $ 27,157,000 $ 22,462,000 $ 28,279,000 Pool-based single currency (JPY) loans 3,202,996,000 3,683,699,000 3,138,612,000 3,594,501,000 Pool-based single currency (US$) loans 7,049,324,000 8,609,127,000 7,716,536,000 8,537,918,000 LIBOR-based loans 25,219,728,000 25,084,442,000 19,135,910,000 19,012,074,000 Fixed rate loans 11,470,000 12,806,000 15,587,000 17,811,000 Local currency loans 404,296,000 413,728,000 253,772,000 270,787,000

Total $35,910,060,000 $37,830,959,000 $30,282,879,000 $31,461,370,000




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LIBOR-based loans negotiated after 1 January 2007, from

75 basis points on a progressive structure of undisbursed

loan balances to a flat fee of 35 basis points on the full

amount of undisbursed balances. Further to this, the Board

also approved in April 2007, the waiver of 10 basis points

of the commitment charge on the undisbursed balances

of sovereign project loans negotiated after 1 January 2007

and 50 basis points of the commitment charge on the

undisbursed balances of sovereign program loans.

In December 2007, the Board approved the revision

of loan charges for sovereign LIBOR-based loans negotiated

on and after 1 October 2007 by a) providing a credit of

0.4% for the duration of the loan, resulting to an effective

contractual spread of 0.2%; b) reducing the commitment

charge from 0.75% and 0.35% for sovereign program and

project loans to 0.15% for both sovereign program and

project loans; and c) eliminating front-end fees.

Undisbursed loan commitments and an analysis of

loans by borrowing member countries as of 31 December

2008 are shown in OCR-5. The carrying amounts of loan

outstanding by loan products at 31 December 2008 and


2008 2007

Sovereign Loans Fixed rate multicurrency loans $ 22,246,000 $ 22,462,000 Pool-based single currency (JPY) loans 3,202,996,000 3,136,766,000 Pool-based single currency (US$) loans 7,054,332,000 7,722,916,000 LIBOR-based loans 23,901,052,000 18,078,713,000

34,180,626,000 28,960,857,000

Provision for loan losses (4,356,000) (5,689,000) Unamortized direct loan origination cost 76,114,000 47,936,000

71,758,000 42,247,000

Subtotal 34,252,384,000 29,003,104,000

Nonsovereign Loans Pool-based single currency (JPY) loans – 1,846,000 Fixed rate loans 11,488,000 15,586,000 LIBOR-based loans 1,253,775,000 1,018,846,000 Local currency loans 404,952,000 258,657,000 Others 131,000 –

1,670,346,000 1,294,935,000

Provision for loan losses (4,818,000) (9,354,000) Unamortized front-end fee (7,852,000) (5,806,000)

(12,670,000) (15,160,000)

Subtotal 1,657,676,000 1,279,775,000

Total $35,910,060,000 $30,282,879,000

Loans in Non-accrual Status

One nonsovereign loan was in non-accrual status as of 31

December 2008 (four – 2007). The principal outstand-

ing at that date was $1,674,000 ($16,507,000 – 2007) of

which $1,315,000 ($9,659,000 - 2007) was overdue. Loans

in non-accrual status resulted in $151,000 ($3,223,000

– 2007) not being recognized as income from nonsover-

eign loans for the year ended 31 December 2008, and a

total of $525,000 as of 31 December 2008 ($8,314,000

– 2007). The significant decrease resulted mainly from

the waiver of loan charges totaling $4,735,000 due to sale

of two loans in January 2008 and restructuring of one

loan in April 2008, and recovery of $2,717,000 from the

restructured loan.

In 2008, one sovereign loan was restored to accrual

status and loan charges of $1,130,000 for 2007 was

recognized as income for the current year.

Loan Loss Provision

ADB has not suffered any losses of principal on sovereign

loans. During the year, $1,333,000 loan loss provision was

written back on two loans ($427,000 on one loan – 2007).

Accumulated loan loss provision for sovereign loans as of

31 December 2008 was $4,356,000 ($5,689,000 – 2007).

Loan loss provisions for nonsovereign loans totaling

$4,968,000 were written back/off mainly due to sale of

two loans. This reduced the balance of accumulated loan

loss provision for nonsovereign loans to $4,818,000 as of

31 December 2008 ($9,354,000 – 2007).

Information pertaining to loans which were subject

to loan loss provisions at 31 December 2008 and 2007 is

as follows: 2008 2007

Loans not subject to loss provisions $35,841,044,000 $30,233,596,000 Loans subject to loss provisions 9,928,000 22,196,000

Total $35,850,972,000 $30,255,792,000

Average amount of loans subject to loss provisions $ 11,325,000 $ 30,019,000 Related interest income on such loans recognized in the year $ 4,946,000 $ 921,000 Cash received on related interest income on such loans $ 4,933,000 $ 782,000

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The changes in the provision for loan losses during 2008 and 2007 are as follows:

2008 2007

Sovereign Nonsovereign Sovereign Nonsovereign Loans Loans Total Loans Loans Total

Balance 1 January $5,689,000 $9,354,000 $15,043,000 $6,116,000 $22,223,000 $28,339,000 Provision written back - net (1,333,000) (2,134,000) (3,467,000) (427,000) (152,000) (579,000)Provision written off – (2,400,000) (2,400,000) – (12,717,000) (12,717,000)Translation adjustment – (2,000) (2,000) – – –

Balance 31 December $4,356,000 $4,818,000 $9,174,000 $5,689,000 $9,354,000 $15,043,000

Cofinancing

ADB functions as lead lender in cofinancing arrangements

with other participating financial institutions who also

provide funds to ADB’s sovereign and nonsovereign bor-

rowers. In such capacity, ADB provides loan administra-

tion services, which include loan disbursements and loan

collections. The participating financial institutions have

no recourse to ADB for their outstanding loan balances.

Loans administered by ADB on behalf of

participating institutions as at 31 December 2008 and


2008

No.of Amount Loans Sovereign loans $503,017,000 36Nonsovereign loans 403,517,000 10 Total $906,534,000 46

2007

No.of Amount Loans Sovereign loans $527,247,000 32Nonsovereign loans 432,865,000 12

Total $960,112,000 44

During the year ended 31 December 2008, a total of

$115,000 ($490,000 - 2007) was received as compensation

for arranging and administering such loans. This amount

has been included in “Income from other sources.”

NOTE F—GUARANTEES

ADB extends guarantees to public sector and private

sector borrowers. Such guarantees include (i) partial

credit guarantees where only certain principal and/or

interest payments are covered; and (ii) political risk

guarantees, which provide coverage against well-defined

sovereign risks. While counterguarantees from the host

government are required for all public sector guarantees,

guarantees for private sector projects may be provided

with or without a host government counterguarantee. A

counterguarantee takes the form of a member govern-

ment agreement to indemnify ADB for any payments it

makes under the guarantee. In the event that a guarantee

is called, ADB has the contractual right to require pay-

ment from the government, on demand, or as ADB may

otherwise direct.

Guaranteed payments under partial credit

guarantees are generally due 10 or more years from

the loan inception date. ADB’s political risk guarantee

is callable when a guaranteed event has occurred and

such an event has resulted in debt service default to the

guaranteed lender.

In October 2008, ADB paid a total of PKR10,375,000

($127,000 equivalent) under a partial credit guarantee

agreement. The amount was booked as a loan arising from

a guarantee call with a corresponding 100% provision for

losses.




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The committed and outstanding amounts of these guarantee obligations as of 31 December 2008 and 2007

covered:

None of the outstanding amounts as of 31

December 2008 were subject to call. The committed

amount represents the maximum potential amount

of undiscounted future payment that ADB could be

required to make, inclusive of standby portion for

which ADB is committed but not currently at risk. The

outstanding amount represents the guaranteed amount

utilized under the related loans, which have been

disbursed as of the end of a reporting period, exclusive

of the standby portion. ADB estimates that the present

value of guarantees outstanding at 31 December 2008

was $1,130,777,000 ($965,849,000 – 2007).

As of 31 December 2008, a total liability of

$23,257,000 ($13,668,000 – 2007) relating to stand-by

ready obligation for seven partial credit risk guarantees

(five – 2007) and two political risk guarantees (two -

2007) has been included in “Miscellaneous liabilities”

on the balance sheet for all guarantees issued after

31 December 2002.

NOTE G—EQUITY INVESTMENTS

ADB's investments in equity securities issued by private

enterprises located in DMCs include $208,071,000

($212,463,000 – 2007) investments in limited liability

2008 2007

Committed Outstanding Committed Outstanding Amount Amount Amount Amount

Partial Credit Guarantees with counterguarantee $1,164,044,000 $1,097,258,000 $1,001,492,000 $ 962,160,000 without counterguarantee 432,363,000 363,075,000 280,863,000 271,881,000

1,596,407,000 1,460,333,000 1,282,355,000 1,234,041,000

Political Risk Guarantees with counterguarantee 145,156,000 129,419,000 146,813,000 134,210,000 without counterguarantee 30,070,000 24,899,000 30,462,000 27,306,000

175,226,000 154,318,000 177,275,000 161,516,000 Others 950,000 950,000 950,000 950,000

Total $1,772,583,000 $1,615,601,000 $1,460,580,000 $1,396,507,000

partnership and limited liability companies. Such eq-

uity investments are accounted for under the equity

method.

As of 31 December 2008, there were six (six

– 2007) equity investments which were reported at fair

value totaling $238,497,000 ($462,115,000 – 2007). One

investment (nil – 2007) sustained unrealized losses of

$106,816,000 as of year end of 2008.

Accumulated net unrealized gains on equity

investments reported at market value were $116,895,000

at 31 December 2008 ($340,958,000 – 2007) and were

reported in “CAPITAL AND RESERVES” as part of

“Accumulated other comprehensive income.”

Approved equity investment facility that has not

been disbursed was $275,740,000 at 31 December

2008 ($344,046,000 – 2007).

NOTE H—DERIVATIVE INSTRUMENTS

The fair value of outstanding currency and interest rate

swap agreements is determined at the estimated amount

that ADB would receive or pay to terminate the agree-

ments using market-based valuation models. The basis

of valuation is the present value of expected cash flows

based on observable market data.

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Interest rate swaps: Under a typical interest

rate swap agreement, one party agrees to make periodic

payments based on a notional principal amount and an

interest rate that is fixed at the outset of the agreement.

The counterparty agrees to make floating rate payments

based on the same notional principal amount. The terms

of ADB's interest rate swap agreements usually match

the terms of particular borrowings.

Currency swaps: Under a typical currency swap

agreement, one party agrees to make periodic payments

in one currency while the counterparty agrees to make

periodic payments in another currency. The payments

may be fixed at the outset of the agreement or vary based

on interest rates. A receivable is created for the currency

swapped out, and a payable is created for the currency

swapped in. The terms of ADB's currency swap agreements

usually match the terms of particular borrowings.

Included in Receivable/Payable from Swaps-Others

are interest rate and currency swaps that ADB has entered

into for the purpose of hedging specific investments and

loans. The loan related swaps were executed to better

align the composition of certain outstanding loans with

funding sources.

NOTE I—PROPERTY, FURNITURE, AND EQUIPMENT

In 1991, under the terms of an agreement with the

Philippines (Government), ADB returned the former

headquarters premises, which had been provided by the

Government. In accordance with the agreement as sup-

plemented by a memorandum of understanding, ADB

was compensated $22,657,000 for the return of these

premises. The compensation is in lieu of being provided

premises under the agreement and accordingly, is de-

ferred and amortized over the estimated life of the new

headquarters building as a reduction of occupancy ex-

pense. The amortization for the year ended 31 December

2008 amounted to $386,000 ($387,000 – 2007) reducing

depreciation expense for the new headquarters build-

ing from $4,427,000 ($4,471,000 – 2007) to $4,041,000

($4,084,000 – 2007). At 31 December 2008, the un-

amortized deferred compensation balance (included in

“ACCOUNTS PAYABLE AND OTHER LIABILITIES

- Miscellaneous”) was $8,218,000 ($9,529,000 – 2007).

At 31 December 2008 accumulated depreciation for

property, furniture, and equipment was $158,259,000

($147,999,000 – 2007).

NOTE J—BORROWINGS

The key objective of ADB’s borrowing strategy is to raise

funds at the lowest possible cost for the benefit of its

borrowers. ADB uses financial derivative instruments

in connection with its borrowing activities to increase

cost efficiency, while achieving risk management objec-

tives. Currency swaps enable ADB to raise operationally

needed currencies in a cost-efficient way and to maintain

its borrowing presence in the major capital markets.

Interest rate swaps are used generally to reduce interest

rate mismatches arising from lending operations.

NOTE K—CAPITAL STOCK, CAPITAL TRANSFERRED TO ASIAN DEVELOPMENT FUND, MAINTENANCE OF VALUE OF CURRENCY HOLDINGS, AND MEMBERSHIP

Capital Stock

The authorized capital stock of ADB as of the end of 2008

and 2007 consists of 3,546,311 shares, all of which have

been subscribed by members. Of the subscribed shares,

3,296,887 are “callable” and 249,424 are “paid-in.” The

“callable” share capital is subject to call by ADB only as

and when required to meet ADB's obligations incurred on

borrowings of funds for inclusion in its Ordinary Capital

Resources (OCR) or on guarantees chargeable to such

resources. The “paid-in” share capital has been paid or is

payable in installments, partly in convertible currencies

and partly in the currency of the subscribing member

which may be convertible. In accordance with Article 6,

paragraph 3 of the Charter, ADB accepts non-negotiable,

non-interest-bearing demand obligations in satisfaction

of the portion payable in the currency of the member,

provided such currency is not required by ADB for the

conduct of its operations. The settlement of such amounts

is not determinable and, accordingly, it is not practicable

to determine a fair value for these receivables.

As of 31 December 2008, all matured installments

amounting to $3,850,762,000 ($3,917,444,000 - 2007)

were received. Installments not due aggregating

$9,848,000 ($19,664,000 - 2007) are as follows:

For the Year ending 31 December:

2009 $6,563,000 2010 $3,285,000




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Capital Transferred to Asian Development Fund

Pursuant to the provisions of Article 19, paragraph 1(i)

of the Charter, the Board of Governors has authorized

the setting aside of 10% of the unimpaired “paid-in”

capital paid by members pursuant to Article 6, paragraph

2(a) of the Charter and of the convertible currency por-

tion paid by members pursuant to Article 6, paragraph

2(b) of the Charter as of 28 April 1973 to be used as

a part of the Special Funds of ADB. The resources so

set aside amounting to $73,691,000 as of 31 December

2008 ($75,151,000 - 2007) expressed in terms of the

SDR on the basis of $1.54781 ($1.57848 - 2007) per

SDR ($57,434,000 in terms of $1.20635 per 1966 dol-

lar—Note B), were allocated and transferred to the Asian

Development Fund.

Maintenance of Value of Currency Holdings

Prior to 1 April 1978, the effective date of the Second

Amendment to the IMF Articles, ADB implemented

maintenance of value (MOV) in respect of holdings of

member currencies in terms of 1966 dollars, in accord-

ance with the provisions of Article 25 of the Charter and

relevant resolutions of the Board of Directors. Since then,

settlement of MOV has been put in abeyance.

In as much as the valuation of ADB's capital stock

and the basis of determining possible MOV obligations

are still under consideration, notional amounts have

been calculated provisionally as receivable from or

payable to members in order to maintain the value of

currency holdings in terms of the SDR. In view thereof,

the notional MOV amounts of receivables and payables

are offset against one another and shown as net notional

amounts to maintain value of currency holdings in the

“CAPITAL AND RESERVES” portion of the Balance

Sheet. The carrying book value for such receivables and

payables approximates its fair value.

The net notional amounts as of 31 December

2008 consisted of (a) the increase of $740,985,000

($806,160,000 – 2007) in amounts required to maintain

the value of currency holdings to the extent of matured

and paid capital subscriptions due to the increase in the

value of the SDR in relation to the United States dollar

during the period from 1 April 1978 to 31 December 2008

and (b) the net increase of $176,602,000 ($144,963,000

- 2007) in the value of such currency holdings in relation

to the United States dollar during the same period. In

terms of receivable from and payable to members, they

are as follows:

2008 2007

Notional MOV Receivables $957,549,000 $853,546,000 Notional MOV Payables 393,166,000 192,349,000

Total $564,383,000 $661,197,000

Membership

As of 31 December 2008, ADB’s shareholders consist of

67 member countries, 48 countries from the region and

19 countries from outside the region (OCR–7).

NOTE L—RESERVES

Ordinary Reserve and Net Income

Under the provisions of Article 40 of the Charter, the

Board of Governors shall determine annually what part

of the net income shall be allocated, after making provi-

sion for reserves, to surplus and what part, if any, shall be

distributed to the members.

In May 2008, the Board of Governors approved

the allocation of 2007 net income of $760,174,000

to Cumulative Revaluation Adjustments account for

$87,623,000, to Loan Loss Reserve for $12,962,000, to

Surplus and Ordinary Reserve for $278,294,000 each, to

Technical Assistance Special Fund for $23,000,000, and

to Asian Development Fund (ADF) and Climate Change

Fund for $40,000,000 each.

In 2007, the 2006 net income of $565,886,000 and

additions from Cumulative Revaluation Adjustments

account of $138,479,000 were allocated to Loan Loss

Reserve for 52,000,000, to Surplus and Ordinary Reserve

for $286,183,000 each, and to ADF and Regional

Cooperation and Integration Fund for $40,000,000 each.

The restatement of the capital stock for purposes

of these financial statements on the basis of the SDR

instead of the 1966 dollar (Note B) resulted in a net credit

of $8,860,000 to the Ordinary Reserve during the year

ended 31 December 2008 (net charge of $34,587,000 -

2007). That credit is the decrease in the value of the

matured and paid capital subscriptions caused by the

change during the year in the value of the SDR in relation

to the United States dollar not allocated to members as

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notional maintenance of value adjustments in accordance

with resolutions of the Board of Directors.

Cumulative Revaluation Adjustments Account

In May 2002, the Board of Governors approved the al-

location of net income representing the cumulative net

unrealized gains (losses) on derivatives, as required by

FAS 133 to a separate category of Reserves - “Cumulative

Revaluation Adjustments Account.” Beginning 2008, the

unrealized portion of net income from equity invest-

ments accounted under equity method is also transferred

to this account. During the year, the 2007 net unrealized

gains on derivatives of $57,508,000 and on income from

equity investments accounted under equity method of

$30,115,000 reduced the credit balance of the Cumulative

Revaluation Adjustments account at 31 December 2008

to $23,336,000 ($110,959,000 – 2007).

Special Reserve

The Special Reserve includes commissions on loans

and guarantee fees on guarantees set aside pursuant to

Article 17 of the Charter. Special Reserve assets consist

of term deposits and government and government-guar-

anteed obligations and are included under the heading

“INVESTMENTS.” For the year ended 31 December

2008, guarantee fees amounting to $6,876,000 ($5,049,000

– 2007) were appropriated to Special Reserve.

Loan Loss Reserve

In 2004, the Board of Directors approved the creation of

Loan Loss Reserve through an allocation of $218,800,000

out of prior year net income. The Loan Loss Reserve forms

part of Capital and Reserves to be used as a basis for capital

adequacy against the estimated expected loss in ADB’s

sovereign loans and guarantees portfolio. In December

2006, the Board of Directors approved the adoption of

this policy to nonsovereign credit exposures.

In 2008, the estimated loan loss reserve requirement

was $195,062,000 resulting to an increase of $12,962,000.

The estimated expected loss is determined using ADB’s

credit risk model net of loan loss provisions taken up

in accordance with generally accepted accounting

principles.

Surplus

Surplus represents funds for future use to be deter-

mined by the Board of Governors. In the first half of

2008, the Board of Governors approved the allocation

of $278,294,000 out of 2007 net income to Surplus

($286,183,000 – 2007).

Comprehensive Income

Comprehensive income has two major components: net

income and other comprehensive income comprising

gains and losses affecting equity that, under accounting

principles generally accepted in the United States of

America, are excluded from net income. Other compre-

hensive income includes such items as the effects of the

implementation of FAS 133, unrealized gains and losses

on available-for-sale securities and listed equity invest-

ments, currency translation adjustments, and pension

and post-retirement liability adjustment.

NOTE M—INCOME AND EXPENSES

Total income from loans for the year ended 31 December

2008 was $1,358,506,000 ($1,446,318,000 – 2007). The

average yield on the loan portfolio during the year was

3.84% (5.00% - 2007), excluding premium received on

prepayment and other loan income. Premium on prepaid

loans during 2008 amounted to $3,915,000 ($232,000

– 2007).

Total income from investments including net

realized losses on sales, net unrealized losses on

derivatives, and interest earned for securities transferred

under repurchase agreements and resale arrangements

for the year ended 31 December 2008 was $564,059,000

($676,230,000 – 2007). The annualized rate of return

on the average investments held during the year, based

on the portfolio held at the beginning and end of each

month, was 3.20% (4.68% – 2007) excluding unrealized

gains and losses on investments and 4.63% (5.79% – 2007)

including unrealized gains and losses on investments.

Including net realized losses, equity investment

operations resulted to a net loss of $147,000 ($80,690,000

income – 2007) for the year ended 31 December 2008.

This included a total of $12,160,000 share in the net losses

of investee companies accounted under equity method

and $8,688,000 impairment losses mostly associated

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gains on disposals, and other income of $15,823,000,

$4,804,000, and $75,000 respectively.

Income from other sources primarily included

income received as executing agency amounting to

$9,979,000 ($9,843,000 – 2007), interests earned on

bank accounts and on staff accounts totaling $1,369,000

($645,000 – 2007) and $1,682,000 ($2,265,000 – 2007),

respectively, and reversals of expenses charged to prior

years of $4,335,000 ($4,719,000 – 2007).

Total interest expense incurred for the year

ended 31 December 2008 amounted to $1,181,410,000

($1,368,177,000 – 2007). Other borrowings and related

expenses consisted of amortization of borrowings’

issuance costs and other expenses of $26,981,000

($21,601,000 – 2007).

Administrative expenses (other than those

pertaining directly to ordinary operations and special

operations) for the year ended 31 December 2008 were

apportioned between OCR and ADF in proportion of

the relative volume of operational activities of each fund.

Of the total administrative expenses of $363,724,000

($347,803,000 – 2007), $187,138,000 ($186,396,000

– 2007) was accordingly charged to ADF. The balance of

administrative expenses after allocation was reduced by

the deferral of direct loan origination costs of $35,539,000

($34,080,000 – 2007) related to new loans that became

effective for the year ended 31 December 2008 (Notes B and E).

In November 2008, following the approval by the

Board of Directors in September 2007, ADB entered into

a Trust fund Grant Arrangement with International Bank

for Reconstruction and Development and International

Development Association, to provide $10,000,000 as

a contribution to the Java Reconstruction Fund. This

was charged to OCR current income as “TECHNICAL

ASSISTANCE TO MEMBER COUNTRIES.” Net of

write-back for the year totaling $1,643,000 ($683,000

– 2007) representing cancellations of the undisbursed

amounts of completed TA projects committed in prior

periods, technical assistance for the year amounted to

$8,357,000.

As of 31 December 2008, the net cumulative amount

of TA commitments that had been charged to OCR net

income amounted to $76,205,000 ($67,848,000 – 31

December 2007) out of which $65,716,000 ($65,530,000

– 2007) had been disbursed.

For the year ended 31 December 2008, total write-

back of provision for losses amounted to $3,467,000

($579,000 - 2007). This corresponded to $1,333,000 for

two sovereign loans and $2,134,000 for a nonsovereign

loan, resulting mainly from repayments and loan

restructuring.

Other expenses of $6,271,000 ($3,998,000 – 2007)

included non-borrowings related financial expenses

such as fees paid to external asset managers and bank

charges.

Net unrealized gains incorporated $429,000

net losses ($3,680,000 – 2007) from the translation

adjustments of financial instruments denominated in

non-functional currencies (South African Rand and

Mexican Peso), and net unrealized gains on derivatives

of $451,020,000 ($57,508,000 – 2007), which were made

up of:

2008 2007

Unrealized gains (losses) on: Hybrid financial instruments and related swaps* $387,136,000 $ (5,322,000) Non-hybrid financial instruments and related swaps* 249,942,000 108,028,000 Investments related swaps (88,279,000) (4,182,000) Loan related swaps (98,625,000) (38,089,000) FX Forward 263,000 (1,958,000)Amortization of the FAS 133 transition adjustment 583,000 (969,000)

Total $451,020,000 $ 57,508,000

*Figures are not comparable due to the adoption of FAS 157 and 159 effective 1 January 2008, where (a) credit risk (spread) were incorporated in fair valuing the outstanding financial instruments, and (b) non-hybrid swapped borrowings which were recorded at amortized cost in 2007, were recorded at fair value in 2008.

NOTE N—OTHER ASSETS AND LIABILITIES— MISCELLANEOUS

At 31 December 2008 and 2007, ADB had the follow-

ing receivables from/payables to special funds and trust

funds resulting from administrative arrangements and

operating activities:

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2008 2007

Amounts receivable from:

Asian Development Fund (Note M) $31,743,000 $28,750,000

Technical Assistance Special Fund – 14,000 Japan Special Fund 145,000 159,000 Asian Tsunami Fund 669,000 343,000 Pakistan Earthquake Fund 4,000 5,000 Regional Cooperation and Integration Fund 15,000 – Climate Change Fund 6,000 – Asian Development Bank Institute Special Fund 847,000 341,000 Staff Retirement Plan – 11,012,000 Agency Trust Funds (net) 842,000 1,984,000

Total $34,271,000 $42,608,000

Amounts payable to:

Technical Assistance Special Fund $ 12,000 $ – Staff Retirement Plan 14,205,000 –

Total $14,217,000 $ –

NOTE O—STAFF RETIREMENT PLAN AND POSTRETIREMENT MEDICAL BENEFITS

Staff Retirement Plan

ADB has a contributory defined benefit Staff Retirement

Plan (the Plan). Every employee, as defined under the

Plan, shall, as a condition of service, become a participant

from the first day of service, provided that at such a date,

the employee has not reached the normal retirement age

of 60. The Plan applies also to members of the Board of

Directors who elect to join the Plan. Retirement ben-

efits are based on length of service and highest average

remuneration during two years of eligible service. The

Plan assets are segregated and are not included in the

accompanying Balance Sheet. The costs of administering

the Plan are absorbed by ADB, except for fees paid to

the investment managers and related charges, including

custodian fees, which are borne by the Plan.

Participants hired on or before 30 September 2006

are required to contribute 9 1/3% of their salary to the

Plan while those hired after that date do not anymore

contribute to the plan. Participants may also make

additional voluntary contributions. ADB's contribution

is determined at a rate sufficient to cover that part of

the costs of the Plan not covered by the participants'

contributions.

Expected Contributions

The expected amount of contributions to the Plan for

2009 amounts to $51,499,000 ($43,291,000 – 2007)

representing ADB’s contributions of $29,394,000

($22,902,000 – 2007), based on budgeted contribu-

tion rate of 19% (16% - 2007), participants’ mandatory

contributions of $11,605,000 ($11,889,000 – 2007) and

discretionary contributions of $10,500,000 ($8,500,000

– 2007).

Investment Strategy

Contributions in excess of current benefits payments

are invested in international financial markets and in a

variety of investment vehicles. The Plan employs nine

external asset managers and one global custodian who

function within the guidelines established by the Plan’s

Investment Committee. The investment of these assets,

over the long term, is expected to produce higher returns

than short-term investments. The investment policy

incorporates the Plan’s package of desired investment re-

turn and tolerance for risk, taking into account the nature

and duration of the Plan’s liabilities. The Plan’s assets are

diversified among different markets and different asset

classes. The use of derivatives for speculation, leverage or

taking risks is prohibited. Selected derivatives are used

for hedging and transactional efficiency purposes.

The Plan’s investment policy is periodically

reviewed and revised to reflect the best interest of the

Plan’s participants and beneficiaries. The current policy,

adopted in January 2003, specifies an asset-mix structure

of 70% of assets in equities and 30% in fixed income

securities. At present, investments of the Plan’s assets

are divided into three categories: US equity, Non-US

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As of 31 December 2008 and 2007, the breakdown

of the fair value of plan assets held are as follows:

2008

Amount Percentage

Equity Securities US $ 320,303,000 Non-US 215,489,000

535,792,000 58.6%Fixed Income Securities 362,584,000 39.6 Other Assets (Liabilities) – net 16,254,000 1.8

Total $ 914,630,000 100.0%

2007

Amount Percentage

Equity Securities US $ 541,837,000 Non-US 407,222,000

949,059,000 72.9%Fixed Income Securities 362,646,000 27.9 Other Assets (Liabilities) – net (10,150,000) (0.8)

Total $1,301,555,000 100.0%

All investments excluding time deposits are

valued using market prices. Time deposits are reported

at cost which is a reasonable estimate of fair value.

Fixed income securities include US government and

government guaranteed obligations, corporate bonds and

time deposits. Other assets include forward exchange

contracts in various foreign currencies transacted to

hedge currency exposure in the investment portfolio,

which are reported at fair value.

For the year ended 31 December 2008 the net return

on the Plan assets was -29.5% (6.0% – 2007). ADB expects

the long-term rate of return on the assets to be 8%.

Assumptions

The assumed overall rate of return takes into account

long-term return expectations of the underlying as-

set classes within the investment portfolio mix, and

the expected duration of the Plan’s liabilities. Return

expectations are forward looking and, in general, not

much weight is given to short-term experience. Unless

there is a drastic change in investment policy or market

environment, the assumed investment return of 8% on

the Plan’s assets is expected to remain broadly the same,

year to year.

Postretirement Medical Benefits Plan

In 1993, ADB adopted a cost-sharing plan for retirees’

medical insurance premiums. Under the plan, ADB is

obligated to pay 75% of the Group Medical Insurance

Plan premiums for retirees, including retired members

of the Board of Directors, and their eligible dependents

who elected to participate. The cost-sharing plan is cur-

rently unfunded.

Generally accepted accounting principles require

an actuarially determined assessment of the periodic

cost of postretirement medical benefits.

The following table sets forth the pension and

postretirement medical benefits at 31 December 2008

and 2007:

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For measurement purposes, a 9.0% annual rate of

increase in the per capita cost of covered health care

benefits was assumed for the valuation as at 31 December

Pension Benefits Postretirement Medical Benefits

2008 2007 2008 2007

Change in projected benefit obligation: Projected benefit obligation at beginning of year $1,476,832,000 $1,336,833,000 $ 193,008,000 $ 187,030,000 Service cost 38,077,000 38,564,000 8,432,000 8,823,000 Interest cost 89,682,000 81,558,000 11,969,000 11,634,000 Plan participants’ contributions 30,831,000 27,186,000 – – Transfers – (232,000) – – Actuarial (gain) loss (163,591,000) 59,287,000 (57,563,000) (11,952,000) Amendments – – – – Benefits paid (75,032,000) (66,364,000) (2,715,000) (2,527,000)

Projected benefit obligation at end of year $1,396,799,000 $1,476,832,000 $ 153,131,000 $ 193,008,000 Change in plan assets: Fair value of plan assets at beginning of year $1,301,555,000 $1,235,346,000 $ – $ – Actual return on plan assets (381,940,000) 73,905,000 – – Employer’s contribution 39,216,000 31,714,000 2,715,000 2,527,000 Plan participants’ contributions 30,831,000 27,186,000 – – Transfers – (232,000) – – Benefits paid (75,032,000) (66,364,000) (2,715,000) (2,527,000)

Fair value of plan assets at end of year $ 914,630,000 1,301,555,000 $ – – Funded status $ (482,169,000) $ (175,277,000) $ (153,131,000) $(193,008,000) Amounts recognized in the Balance sheet consist of: Current liabilities – – (4,183,000) (3,907,000) Noncurrent liabilities (482,169,000) (175,277,000) (148,948,000) (189,101,000) Net amount recognized $ (482,169,000) $ (175,277,000) $ (153,131,000) $(193,008,000) Amounts recognized in the Accumulated other comprehensive income consist of: Net actuarial loss (gain) $ 425,385,000 $ 110,605,000 $ (15,660,000) $ 43,853,000 Prior service cost (credit) 11,833,000 15,912,000 (20,002,000) (28,648,000) Total amount recognized $ 437,218,000 $ 126,517,000 $ (35,662,000) $ 15,205,000 Weighted-average assumptions as of 31 December Discount rate 7.25% 6.00% 7.25% 6.00% Expected return on plan assets 8.00% 8.00% N/A N/A Rate of compensation increase varies with age and averages 5.05% 4.65% 5.05% 4.65%

2008. The rate was assumed to decrease gradually to

5.0% for 2013 and remain at the level thereafter.




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The accumulated benefit obligation of the pension

plan as of 31 December 2008 was $1,306,323,000

($1,374,738,000 – 2007).

The estimated net loss and prior service cost for

the defined benefit pension plans that will be amortized

from accumulated other comprehensive income into

net periodic benefit cost over the next fiscal year are

US$8,940,000 and US$4,079,000, respectively. The

estimated net loss and prior service credit for the other

postretirement benefits plan that will be amortized

from accumulated other comprehensive income into

net periodic benefit cost over the next fiscal year is

US$(27,000) and US$(8,646,000), respectively.

A one-percentage-point change in assumed health

care trend rates would have the following effects:

1-Percentage- 1-Percentage- Point Increase Point Decrease

Effect on total service and interest cost components $ 5,234,000 $ (3,953,000)Effect on postretirement benefit obligation 27,449,000 (21,903,000)

Estimated Future Benefits Payments

The following table shows the benefit payments expected

to be paid in each of the next five years and subsequent

five years. The expected benefit payments are based

on the same assumptions used to measure the benefit

obligation at 31 December 2008:

Pension Postretirement Benefits Medical Benefits

2009 $ 68,830,000 $ 4,183,000 2010 66,041,000 4,802,000 2011 71,501,000 5,475,000 2012 76,081,000 6,137,000 2013 78,628,000 6,780,000 2014-2018 460,645,000 43,674,000

NOTE P—FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amounts and estimated fair values of ADB's

significant financial instruments as of 31 December 2008

and 2007 are summarized in the next page.

The Fair Value Option

Effective 1 January 2008, ADB elected the Fair Value

Option on all borrowings with associated derivative

instruments. This election allows ADB to mitigate the

earnings volatility in its statutory reporting that is caused

by the different accounting treatment of the borrowing

and its related derivative without having to apply the

complex hedge accounting requirements of FAS 133.

Fair Value Measurement

FAS 157 defines fair value as the price that would be

received to sell an asset or paid to transfer a liability at

measurement date (exit price) in an orderly transaction

among willing participants with an assumption that the

transaction takes place in the entity’s principal market,

the most advantageous market for the asset or liability.

The most advantageous market is the market where the

sale of the asset or transfer of liability would maximize the

amount received for the asset or minimize the amount

paid to transfer the liability. The fair value measurement

is not adjusted for transaction cost.

ADB determines fair values using inputs based on

quoted or observable market prices and cash flow models.

Inputs for the models are based on observable market

data such as yield curves, interest rates, volatilities, and

foreign exchange rates. Parameters and models used for

valuation are subject to internal review and periodic

external validation.

Pension Benefits Postretirement Medical Benefits

2008 2007 2008 2007

Components of net periodic benefit cost:

Service cost $38,077,000 $38,564,000 $ 8,432,000 $ 8,823,000 Interest cost 89,682,000 81,558,000 11,969,000 11,634,000 Expected return on plan assets (98,293,000) (88,047,000) – – Amortization of prior service cost 4,079,000 4,079,000 (8,646,000) (8,646,000) Recognized actuarial loss 1,862,000 2,569,000 1,950,000 3,304,000

Net periodic benefit cost $35,407,000 $38,723,000 $13,705,000 $15,115,000

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Following guidelines are applied in determining

the fair values of financial instruments:

Borrowings and associated derivative instruments. Structured borrowings issued by ADB are valued by using

the discounted cash flow models based on embedded

options such as caps, floors, calls, and credit spread. These

models use pay-off profiles within the realm of accepted

market practices such as Hull-White, Black and Scholes,

Libor Market Model as applicable. Non-structured

swapped borrowings, forward foreign exchange, interest

rate, and cross currency swap contracts are fair valued

with observable market inputs using discounted cash

flow models. Market observable inputs, such as yield

curves, foreign exchange rates, basis spreads, credit

spreads, cross currency rates, and volatilities are applied

to the models to determine fair value of borrowings.

Classified under Level 2 are swapped borrowings and the

related derivatives for which ADB can obtain observable

market inputs in the form of primary broker quotes for

similar debt instruments. Included in Level 3 category

are swapped borrowings fair-valued using significant

unobservable inputs.

Investments, asset swaps, repurchase agreements and resale arrangements. Readily marketable investments

are fair valued using active market quotes in Level 1

category. Level 2 category includes investments and

repurchase agreements fair valued with significant other

market observable inputs. Included in Level 3 category

are insignificant portfolio of investments fair valued

using significant unobservable inputs including prices

provided by third parties such as the custodians and

asset managers. Forward foreign exchange, interest rate,

and cross currency swap contracts are fair valued with

observable market inputs using discounted cash flow

models. Market observable inputs, such as yield curves,

foreign exchange rates, basis spreads, credit spreads,

cross currency rates, and volatilities are applied to the

models to determine fair value of investments.

2008 2007

Carrying Estimated Carrying Estimated Amounta Fair Value Amounta Fair Value

On-balance sheet financial instruments:

ASSETS:

Due from banks $ 142,238,000 $ 142,238,000 $ 108,821,000 $ 108,821,000 Investments (Note D) 15,412,519,000 15,412,519,000 13,296,943,000 13,296,943,000 Securities transferred under repurchase agreement 309,358,000 309,358,000 5,041,387,000 5,041,387,000 Securities purchased under resale arrangement 511,756,000 511,756,000 427,132,000 427,132,000 Loans outstanding (Note E) 35,910,060,000 37,830,959,000 30,282,879,000 31,461,370,000 Equity investments (Note G) 641,427,000 641,427,000 808,157,000 808,157,000 Other assets Non-negotiable, non-interest-bearing demand obligations 144,514,000 93,724,000 174,805,000 105,027,000 Receivable from swaps – others (Note H) 882,793,000 882,793,000 512,089,000 512,089,000 Receivable from swaps – borrowings (Note H) 23,831,087,000 23,831,087,000 17,968,867,000 17,968,867,000 Future guarantee receivable 23,257,000 23,257,000 13,668,000 13,668,000

LIABILITIES:

Borrowings (Note J) 36,026,446,000 37,848,839,000 31,959,299,000 32,023,669,000 Other liabilities Payable for swaps – others (Note H) 1,198,781,000 1,198,781,000 583,321,000 583,321,000 Payable for swaps – borrowings (Note H) 24,867,815,000 24,867,815,000 16,936,964,000 16,936,964,000 Guarantee liability 23,257,000 23,257,000 13,668,000 13,668,000

2008 2007

Outstanding Present Outstanding Present Amount Value Amount Value

Off-balance sheet financial instruments: Guarantees (Note F) $ 1,189,851,000 $ 769,204,000 $ 1,060,328,000 $ 689,145,000

a The carrying amount for borrowings and swaps are inclusive of accrued interest.




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Equity Investments. Readily marketable equity

investments are fair valued using quoted prices in active

markets.

Fair Value Hierarchy

FAS 157 establishes a fair value hierarchy that gives the

highest priority to quoted prices in active markets for

identical assets or liabilities (Level 1), next priority to

observable market inputs or market corroborated data

(Level 2), and the lowest priority to unobservable inputs

without market corroborated data (Level 3). FAS 157

requires the fair value measurement to maximize the use

of market observable inputs.

Assets and liabilities measured at fair value on a

recurring basis:

The fair value of the following financial assets and liabilities as of 31 December 2008 were reported based on the following:

Fair Value Measurements

Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs 31 December 2008 (Level 1) (Level 2) (Level 3)

Assets

Investments $15,412,519,000 $6,410,116,000 $ 8,978,004,000 $ 24,399,000 Securities transferred under repurchase agreement 309,358,000 309,358,000 – – Securities purchased under resale arrangement 511,756,000 – 511,756,000 – Investments related swaps 544,796,000 – 544,796,000 – Loans related swaps 337,997,000 – 337,997,000 – Borrowings related swaps 23,831,087,000 – 23,831,087,000 – Equity investments 238,497,000 238,497,000 – –

Total $41,186,010,000 $6,957,971,000 $34,203,640,000 $ 24,399,000

Liabilities

Borrowings $31,012,976,000 – $24,528,881,000 $6,484,095,000 Borrowings related swaps 24,867,815,000 – 24,867,815,000 – Investments related swaps 745,289,000 – 745,289,000 – Loans related swaps 453,492,000 – 453,492,000 –

Total $57,079,572,000 $ – $50,595,477,000 $6,484,095,000

Assets (liabilities) measured at fair value on a recurring basis using significant unobservable inputs (level 3):

Investments Borrowings

Balance, 1 January 2008 $127,442,000 $(5,034,939,000) Total gains (losses) – (realized/unrealized) Included in earnings 52,000 384,233,000 Included in other comprehensive income (8,652,000) 550,965,000 Purchases, sales, and paydowns 1,262,000 – Issuances, redemptions, and maturities – (2,384,354,000) Transfers out of Level 3 (95,705,000) –

Balance, 31 December 2008 $ 24,399,000 $(6,484,095,000)

The amount of net losses for the period included in earnings attributable to the change in net unrealized gains relating to assets/liabilities still held at the reporting date $ – $ 282,466,000

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The following table provides the effect of the initial adoption of FAS 157 and FAS 159.

Carrying value Carrying value 1 January 2008, Net gain 1 January 2008, prior to adoption upon adoption after adoption Borrowings $31,959,300,000 $(227,500,000) $31,731,800,000

Cumulative effect to 1 January 2008 balance of reserves $227,500,000

The fair value of borrowings for which the fair value

option has been elected exceeds the aggregate principal

balance by $1,541,598,000.

The estimated gain from fair value changes included

in earnings that are attributable to the widening of the

credit spreads was $531,665,000 for the year ended 31

December 2008. Changes in fair value resulting from

changes in instrument-specific credit risk were estimated

by incorporating ADB's current observable credit spread

by currency into the relevant valuation technique used

to value the borrowing instruments.

The related interest expense continues to be

measured based on the contractual interest rates

and reported as such in the Statement of Income and

Expenses.

NOTE Q—CREDIT RISK

ADB is exposed to risk if the borrowers fall in arrears on

payments. ADB manages country risk for lending opera-

tions through continuous monitoring of creditworthiness

of the borrowers and rigorous capital adequacy frame-

work. Guarantees involve elements of credit risk which

are also not reflected on the balance sheet. Credit risk

represents the potential loss due to possible nonperform-

ance by obligors and counterparties under the terms of

the contract.

As of 31 December 2008, ADB has a significant

concentration of credit risk to Asian and the Pacific region

associated with loan and guarantee products with credit

exposure determined based on fair value of loans and

outstanding guarantees amounting to $39,446,560,000

($32,857,877,000 – 2007).

ADB undertakes derivative transactions with its

eligible counterparties and transacts in various financial

instruments as part of liquidity and asset/liability

management purposes that may involve credit risks.

For all investment securities and their derivatives, ADB

manages credit risks by following the guidelines set forth

in the Investment Authority (Note D).ADB has a potential risk of loss if the swap

counterparty fails to perform its obligations. In order to

reduce such credit risk, ADB only enters into long-term

swap transactions with counterparties eligible under

ADB's swap guidelines which include a requirement

that the counterparties have a credit rating of A-/A3 or

higher and requires certain counterparties with executed

Credit Support Annex, to provide collateral in form of

cash or other approved liquid securities based on mark-

to-market exposure.

As of 31 December 2008, ADB had received

collateral of $418,995,000 ($461,017,000 – 2007) in

connection with the swap agreements. ADB has also

entered into master swap agreements which contain

legally enforceable close-out netting provisions for all

counterparties with outstanding swap transactions.

NOTE R—SPECIAL AND TRUST FUNDS

ADB's operations include special operations, which are

financed from special fund resources, consisting of the

Asian Development Fund, the Technical Assistance

Special Fund, Japan Special Fund, the Asian Development

Bank Institute Special Fund, the Asian Tsunami Fund,

the Pakistan Earthquake Fund, the Regional Cooperation

and Integration Fund, and the Climate Change Fund.

The OCR and special fund resources are at all

times used, committed, and invested entirely separate

from each other. The Board of Governors may approve

allocation of the net income of OCR to special funds,

based on the funding and operational requirements for

the funds. The administrative and operational expenses

pertaining to the OCR and special funds are charged

to the respective special funds. The administrative

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expenses of ADB are allocated amongst OCR and special

funds and are settled on a regular basis between the

OCR and the special funds.

In addition, ADB, alone or jointly with donors,

administers on behalf of the donors, including members

of ADB, their agencies and other development

institutions, projects/programs supplementing ADB's

operations. Such projects/programs are funded with

external funds administered by ADB and with external

funds not under ADB's administration. ADB charges

administrative fees for external funds administered by

ADB. The funds are restricted for specific uses including

technical assistance to borrowers and technical assistance

2008 2007

Total Net No.of Total Net No.of Assets Funds Assets Funds Special Funds Asian Development Fund $33,479,348,000 1 $31,949,604,000 1 Technical Assistance Special Fund 102,707,000 1 193,119,000 1 Japan Special Fund 142,116,000 1 171,558,000 1 Asian Development Bank Institute Special Fund 15,723,000 1 18,292,000 1 Asian Tsunami Fund 46,387,000 1 40,008,000 1 Pakistan Earthquake Fund 2,203,000 1 (3,453,000) 1 Regional Cooperation and Integration Fund 24,588,000 1 33,817,000 1 Climate Change Fund 37,427,000 1 –

Subtotal 33,850,499,000 8 32,402,945,000 7

Trust Funds Funds administered by ADB 953,075,000 66 1,130,226,000 64 Funds not administered by ADB 7,660,000 2 7,337,000 2

Subtotal 960,735,000 68 1,137,563,000 66

Total $34,811,234,000 76 $33,540,508,000 73

for regional programs. The responsibilities of ADB under

these arrangements range from project processing to

project implementation including the facilitation of

procurement of goods and services. These funds are held

in trust with ADB, and are held in a separate investment

portfolio, which is not commingled with ADB’s funds,

nor are they included in the assets of ADB.

Special funds and funds administered by ADB

on behalf of the donors are not included in the assets

of OCR. The breakdown of the total of such funds

together with the funds of the special operations as of 31

December 2008 and 2007 is as follows:

During the year ended 31 December 2008, a total

of $9,573,000 ($9,310,000 – 2007) was recorded as

compensation for administering projects/programs under

Trust Funds. The amount has been included in “Revenue

from Other Sources - net.”

NOTE S—VARIABLE INTEREST ENTITIES

As of 31 December 2008, ADB did not identify any VIE in

which ADB is the primary beneficiary, requiring consolida-

tion in OCR financial statements. ADB may hold signifi-

cant variable interests in VIE, which requires disclosures.

The review of ADB’s loan, equity investments,

and guarantee portfolio, has identified 2 (2 – 2007)

investments in VIEs in which ADB is not the primary

beneficiary, but in which it is reasonably possible that

ADB could be deemed to hold significant variable

interest. ADB’s total committed investment in these

entities, comprising disbursed and undisbursed balances,

corresponded to the maximum exposure to loss totaling

$143,700,000 as of 31 December 2008 ($109,200,000

– 2007). Based on the most recent available information

from these VIEs, the assets of these VIEs totaled

$422,912,000 ($376,785,000 – 2007).

OCR-8

71Annual Report 2008A

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ASIAN DEVELOPMENT FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

Asian Development Bank72A

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In our opinion, the accompanying special purpose statements of assets, liabilities, fund balances and

the related special purpose statements of revenues and expenses, cash flows and changes in fund

balances present fairly, in all material respects, the financial position of Asian Development Bank

(“ADB” or “the Bank”)—Asian Development Fund at 31 December 2008 and 2007 and the results of

its operations and its cash flows for the years then ended, in conformity with accounting principles

generally accepted in the United States of America, with the exception of loan loss provisioning which

has been eliminated with the adoption of special purpose financial statements. Also in our opinion,

management’s assertion that ADB maintained effective internal control over financial reporting as of

31 December 2008 is fairly stated, in all material respects, based on criteria established in Internal

Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Tread-

way Commission (COSO). The management of ADB is responsible for these financial statements, for

maintaining effective internal control over financial reporting and for its assertion of the effectiveness

of internal control over financial reporting, included in the accompanying Management’s Report on

Internal Control over Financial Reporting. Our responsibility is to express opinions on these financial

statements and on ADB’s internal control over financial reporting based on our integrated audit in

2008 and financial statement audit in 2007. We conducted our audits of the financial statements in

accordance with auditing standards generally accepted in the United States of America and our audit

of internal control over financial reporting in accordance with attestation standards established by

the American Institute of Certified Public Accountants. Those standards require that we plan and

perform the audits to obtain reasonable assurance about whether the financial statements are free of

material misstatement and whether effective internal control over financial reporting was maintained

in all material respects. Our audits of the financial statements included examining, on a test basis,

evidence supporting the amounts and disclosures in the financial statements, assessing the accounting

principles used and significant estimates made by management, and evaluating the overall financial

statement presentation. Our audit of internal control over financial reporting included obtaining an

understanding of internal control over financial reporting, assessing the risk that a material weakness

exists, and testing and evaluating the design and operating effectiveness of internal control based on

the assessed risk. Our audits also included performing such other procedures as we considered neces-

sary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.




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Our audits were conducted for the purpose of forming an opinion on the special purpose financial

statements taken as a whole. The accompanying special purpose statements of loans as at 31 Decem-

ber 2008 and 2007, and of resources as at 31 December 2008 are presented for purposes of additional

analyses and are not required parts of the special purpose financial statements. Such information

has been subjected to the auditing procedures applied in the audits of the special purpose financial

statements and in our opinion is fairly stated in all material respects in relation to the special purpose

financial statements taken as a whole.



















Singapore

5 March 2009


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ADF-1

ASIAN DEVELOPMENT BANK—ASIAN DEVELOPMENT FUND

SPECIAL PURPOSE STATEMENT OF ASSETS, LIABILITIES, AND FUND BALANCES 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007 ASSETS

DUE FROM BANKS (Note B) $ 7,974 $ 2,945

INVESTMENTS (Notes B, C, and L) Government and government-guaranteed obligations $ 2,912,159 $ 688,654 Time deposits 687,147 6,054,661 Corporate bonds 2,401,231 6,000,537 151,409 6,894,724

SECURITIES PURCHASED UNDER RESALE ARRANGEMENT (Notes B, C, and L) 322,361 58,178

LOANS OUTSTANDING (ADF-5) (Notes B, D, L, and M) Sovereign 26,427,289 24,017,992 Less—provision for HIPC Debt Relief 87,471 26,339,818 – 24,017,992

ACCRUED REVENUE On investments 56,659 32,618 On loans 56,045 112,704 59,077 91,695

DUE FROM CONTRIBUTORS (Notes B, E, and L) 1,928,941 1,678,404

RECEIVABLE FROM FORWARD CONTRACTS 307,811 –

OTHER ASSETS 41,270 36,495 TOTAL $35,061,416 $32,780,433 LIABILITIES AND FUND BALANCES

PAYABLE TO RELATED FUNDS (Notes F and H) $ 31,743 $ 30,170

ADVANCE PAYMENTS ON CONTRIBUTIONS (ADF-6) (Note B) 124,473 117,573

UNDISBURSED COMMITMENTS (Notes B, K, and L) 1,052,333 682,582

PAYABLE FOR FORWARD CONTRACTS 373,041 –

OTHER LIABILITIES (Note G) 478 504

TOTAL LIABILITIES 1,582,068 830,829

FUND BALANCES Amounts available for operational commitments (ADF-6) Contributed Resources (Notes B and G) $31,089,051 $28,725,096 Unamortized Discount (ADF-6) (Note B) (44,645) (46,711)

31,044,406 28,678,385 Set-Aside Resources (Note I) 73,691 75,151 Transfers from Ordinary Capital Resources and Technical Assistance Special Fund (Note A) 743,823 703,986

31,861,920 29,457,522 Accumulated surplus (ADF-4) 3,719,782 2,243,408

Accumulated other comprehensive income (ADF-4) (Notes B and J) (2,102,354) 33,479,348 248,674 31,949,604 TOTAL $35,061,416 $32,780,433

The accompanying notes are an integral part of these special purpose financial statements (ADF-7).


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ADF-2


SPECIAL PURPOSE STATEMENT OF REVENUE AND EXPENSES For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

REVENUE From loans (Notes B and D) $ 250,568 $ 218,761 From investments (Notes B and C) 258,880 317,579 From other sources—net 1,066 $ 510,514 1,277 $ 537,617 EXPENSES Grants (Notes B and K) 539,800 377,760 Administrative expenses (Note H) 187,138 186,396 Amortization of discounts on contributions (Notes B and G) 6,547 4,237 Provision for HIPC Debt Relief (Notes D and M) 89,788 – Other expenses 17 823,290 25 568,418 NET REALIZED GAINS From loans (Note B) 2,088,211 – From investments 362 2,088,573 – – NET UNREALIZED (LOSSES) GAINS (Note B) (299,423) 13,486 REVENUE IN EXCESS OF (LESS THAN) EXPENSES $1,476,374 $ (17,315)



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SPECIAL PURPOSE STATEMENT OF CASH FLOWS For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

CASH FLOWS FROM OPERATING ACTIVITIES Interest charges on loans received $ 228,544 $ 185,569 Interest on investments received 201,334 302,569 Interest received from securities under resale arrangement 939 2,022 Cash received from other sources 1,066 1,247 Administrative expenses paid (184,109) (183,664) Grants disbursed (177,466) (62,804) Financial expenses paid (16) (24)

Net Cash Provided by Operating Activities 70,292 244,915

CASH FLOWS FROM INVESTING ACTIVITIES Sales of investments 362 – Maturities of investments 132,364,873 135,378,128 Purchases of investments (131,564,370) (135,503,687) Net payments for securities purchased under resale arrangement (247,866) (3,863) Net payments for forward contracts (12,644) – Principal collected on loans 676,889 586,409 Loans disbursed (2,015,224) (1,592,955)

Net Cash Used in Investing Activities (797,980) (1,135,968)

CASH FLOWS FROM FINANCING ACTIVITIES Contributions received and encashed1 698,028 847,961 Cash received from Ordinary Capital Resources 40,000 40,000

Net Cash Provided by Financing Activities 738,028 887,961

Effect of Exchange Rate Changes on Due from Banks (5,311) 3,435

Net Increase in Due from Banks 5,029 343

Due from Banks at Beginning of Year 2,945 2,602

Due from Banks at End of Year $ 7,974 $ 2,945

RECONCILIATION OF REVENUE IN EXCESS OF (LESS THAN) EXPENSES TO NET CASH PROVIDED BY OPERATING ACTIVITIES:

Revenue in excess of (less than) expenses (ADF-2) $ 1,476,374 $ (17,315) Adjustments to reconcile revenue in excess of (less than) expenses to net cash provided by operating activities: Amortization of discounts/premiums on investments (26,222) (18,570) Amortization of discounts/premiums on forward contracts (3,089) – Amortization of discount under ANE 6,547 4,237 Grants approved and effective 539,800 377,760 Capitalized charges on loans (27,421) (24,675) Net loss on sales of investments (362) – Provision for HIPC debt relief 89,788 – Change in disbursed grants (170,098) (51,051) Change in advances under TA grants (7,333) (11,801) Change in accrued revenue on investments and loans (21,898) (2,934) Change in accrued expenses 2,993 2,780 Change in other assets (0) (30) Translation adjustments (1,788,787) (13,486)

Net Cash Provided by Operating Activities $ 70,292 $ 244,915

0 – Less than $500.1 Supplementary disclosure on noncash financing activities: Nonnegotiable, noninterest-bearing demand promissory notes amounting to $823,323 ($783,246 - 2007) were received from contributing members.The accompanying notes are an integral part of these special purpose financial statements (ADF-7).


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ADF-4


SPECIAL PURPOSE STATEMENT OF CHANGES IN FUND BALANCES For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

Accumulated Transfers Other Contributed Set-Aside from OCR Accumulated Comprehensive Resources Resources & TASF Surplus Income Total

Balance - 1 January 2007 $25,963,646 $71,624 $663,614 $2,260,723 $287,863 $29,247,470

Comprehensive income for the year 2007 (Note J) (17,315) (39,189) (56,504) Change in amounts available for operational commitments Contributed Resources 2,727,913 2,727,913 Unamortized Discount (13,174) (13,174) Transfer from ordinary capital resources 40,000 40,000 Change in SDR value of set-aside resources 3,527 3,527 Change in value of transfers from Technical Assistance Special Fund 372 372

Balance - 31 December 2007 $28,678,385 $75,151 $703,986 $2,243,408 $248,674 $31,949,604

Comprehensive income for the year 2008 (Note J) 1,476,374 (2,351,028) (874,654) Change in amounts available for operational commitments Contributed Resources 2,363,955 2,363,955 Unamortized Discount 2,066 2,066 Transfer from ordinary capital resources 40,000 40,000 Change in SDR value of set-aside resources (1,460) (1,460) Change in value of transfers from Technical Assistance Special Fund (163) (163)

Balance - 31 December 2008 $31,044,406 $73,691 $743,823 $3,719,782 $(2,102,354) $33,479,348

Accumulated Other Comprehensive Income (Note J) For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

Accumulated Translation Unrealized Investment Accumulated Other Adjustments Holding Gains (Losses) Comprehensive Income

2008 2007 2008 2007 2008 2007

Balance, 1 January $ 241,638 $ 288,700 $ 7,036 $ (837) $ 248,674 $287,863 Other comprehensive income for the year (2,451,641) (47,062) 100,613 7,873 (2,351,028) (39,189)

Balance, 31 December $(2,210,003) $ 241,638 $107,649 $ 7,036 $(2,102,354) $248,674



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SPECIAL PURPOSE SUMMARY STATEMENT OF LOANS 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

Undisbursed Loans Loans Balances of Not Yet Total Percent of Borrowers/Guarantors1 Outstanding Effective Loans2 Effective2 Loans Total Loans

Afghanistan $ 463,601 $ 324,022 $ – $ 787,623 2.39 Armenia 8,100 59,343 17,337 84,780 0.26 Azerbaijan 26,558 31,570 – 58,128 0.18 Bangladesh 5,743,777 1,156,028 84,850 6,984,655 21.16 Bhutan 115,992 56,852 29,148 201,992 0.61 Cambodia 812,591 215,568 – 1,028,159 3.11 Cook Islands 26,770 76 7,002 33,848 0.10 Georgia 72,560 38,141 – 110,701 0.34 Indonesia 1,130,869 463,476 80,500 1,674,845 5.07 Kazakhstan 7,353 525 – 7,878 0.02 Kiribati 14,520 – – 14,520 0.04 Kyrgyz Republic 570,858 53,359 – 624,217 1.89 Lao PDR 1,129,607 75,169 – 1,204,776 3.65 Maldives 67,199 24,061 7,078 98,338 0.30 Marshall Islands 67,748 – – 67,748 0.21 Micronesia, Fed. States of 48,699 19,100 – 67,799 0.21 Mongolia 575,286 90,020 – 665,306 2.02 Myanmar 565,751 – – 565,751 1.71 Nepal 1,564,986 328,870 – 1,893,856 5.74 Pakistan 6,403,379 763,024 230,229 7,396,632 22.41 Papua New Guinea 301,809 68,417 104,146 474,372 1.44 Philippines 907,770 – – 907,770 2.75 Samoa 84,867 41,645 2,647 129,159 0.39 Solomon Islands 56,169 – – 56,169 0.17 Sri Lanka 2,614,832 403,603 61,996 3,080,431 9.33 Tajikistan 237,101 146,593 – 383,694 1.16 Thailand 45,870 – – 45,870 0.14 Tonga 44,317 – – 44,317 0.13 Tuvalu 6,989 990 – 7,979 0.02 Uzbekistan 26,126 113,257 45,504 184,887 0.56 Vanuatu 53,816 – – 53,816 0.16 Viet Nam 2,630,421 1,107,475 330,708 4,068,604 12.33 Regional 998 593 – 1,591 –

TOTAL – 31 December 2008 26,427,289 5,581,777 1,001,145 33,010,211 100.00 Provision for HIPC Debt Relief (87,471) – – (87,471)

NET BALANCE – 31 December 2008 $ 26,339,818 $ 5,581,777 $ 1,001,145 $ 32,922,740

NET BALANCE – 31 December 2007 $ 24,017,992 $ 6,127,364 $ 1,048,872 $ 31,194,228

1 Loans other than those made directly to a member or to its central bank have been guaranteed by the member.2 Loans negotiated before 1 January 1983 were denominated in current United States dollars. Loans negotiated after that date are denominated in Special Drawing

Rights (SDR) for the purpose of commitment. The undisbursed portions of such SDR loans are translated into United States dollars at the applicable exchange rates as of the end of a reporting period. Of the undisbursed balances, ADB has entered into irrevocable commitments to disburse various amounts totaling $27,601 ($49,996 - 2007).


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MATURITY OF EFFECTIVE LOANS

Twelve Months Five Years Ending 31 December Amount Ending 31 December Amount 2009 $ 1,135,914 2018 7,094,027 2010 945,246 2023 7,272,100 2011 1,059,334 2028 5,751,782 2012 1,136,702 2033 4,000,091 2013 1,214,380 2038 1,805,918 2043 436,212 2048 157,360

Total $ 32,009,066

SUMMARY OF CURRENCIES RECEIVABLE ON LOANS OUTSTANDING

Currency 2008 2007 Currency 2008 2007

Australian dollar $ 59,046 $ 230,396 Norwegian krone 112,091 279,628 Canadian dollar 278,119 921,698 Pound sterling 189,337 497,311 Danish krone 36,809 82,874 Singapore dollar 86 2,603 Euro 2,235,000 5,051,792 Swedish krona 98,374 296,379 Japanese yen 6,262,394 11,740,188 Swiss franc 128,826 356,988 Korean won 24,536 96,630 Thai baht 863 4,103 Malaysian ringgit 875 6,923 United States dollar 2,101,757 3,911,724 New Zealand dollar 1,279 12,958 Special Drawing Rights3 14,897,897 525,797

Total $26,427,289 $24,017,992

3 Basket of currencies defined by the International Monetary Fund consisting of the Euro, Japanese yen, Pound sterling and US dollar.


ADF-5


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SPECIAL PURPOSE STATEMENT OF RESOURCES 31 December 2008 Expressed in Thousands of United States Dollars (Note B)

Effective Effective Amounts Amounts Amounts Committed Not Yet Amounts Committed At Exchange At 31 December 2008 Available Available During Rates Per Exchange For Operational For Operational Amounts Amounts 2008 Resolutions Rates Commitments Commitments Received Receivable

CONTRIBUTED RESOURCES

Australia $ – $ 1,528,867 $ 1,317,489 $ – $ 1,317,489 $ 1,317,489 $ – Austria – 196,897 271,000 17,512 253,488 253,488 – Belgium – 181,749 234,752 1,814 232,938 232,938 – Brunei Darussalam1 9,500 9,500 9,500 – 9,500 9,500 – Canada 5,934 1,581,659 1,638,863 18,205 1,620,657 1,620,657 – China, People’s Republic of – 28,004 28,004 – 28,004 28,004 – Denmark 1,198 211,781 268,061 3,804 264,257 264,257 – Finland 614 132,515 148,550 1,907 146,644 146,644 – France – 1,096,317 1,359,361 – 1,359,361 1,359,361 – Germany – 1,479,254 2,036,586 104,845 1,931,741 1,931,741 – Hong Kong – 54,459 54,459 – 54,459 54,459 – Indonesia – 14,960 14,960 – 14,960 14,960 – Ireland – 28,046 32,470 – 32,470 32,470 – Italy 112,428 916,215 915,630 – 915,630 915,630 – Japan – 8,602,366 15,759,886 – 15,759,886 15,759,886 – Korea, Rep. of 1,400 267,256 220,135 2,541 217,594 217,594 – Luxembourg – 38,328 47,818 – 47,818 47,818 – Malaysia – 14,667 12,435 – 12,435 12,435 – Nauru – 1,933 1,933 – 1,933 1,433 500 The Netherlands – 587,468 798,349 – 798,349 798,349 – New Zealand 295 113,174 100,894 561 100,334 100,334 – Norway – 200,475 187,696 4,255 183,440 183,440 – Portugal – 65,994 93,709 – 93,709 93,709 – Singapore – 7,734 9,130 – 9,130 9,130 – Spain – 295,384 384,090 4,879 379,211 379,211 – Sweden 1,674 338,996 284,391 5,197 279,194 279,194 – Switzerland – 288,698 444,559 – 444,559 444,559 – Taipei,China – 63,475 60,990 – 60,990 60,990 – Thailand – 9,470 9,019 – 9,019 9,019 – Turkey – 110,520 110,520 2,524 107,996 107,996 – United Kingdom – 1,051,133 868,016 – 868,016 868,016 – United States – 3,767,249 3,767,249 278,054 3,489,195 3,489,195 –

Total 133,042 2 23,284,544 31,490,504 3 446,098 4 31,044,406 5 31,043,906 6 500

SET-ASIDE RESOURCES – 73,691 – 73,691 73,691 –

TRANSFER FROM ORDINARY CAPITAL RESOURCES 40,000 740,000 – 740,000 740,000 –

TRANSFERS FROM TECHNICAL ASSISTANCE SPECIAL FUND7 – – 3,823 – 3,823 3,823 –

TOTAL $173,042 $23,284,544 $32,308,018 $446,098 $31,861,920 $31,861,420 $500

Note: Figures may not add due to rounding.1 Became a member of ADB in June 2006, and have committed and fully paid its contribution to ADF IX in June 2008. 2 Except for Brunei and Italy, amounts committed during the year represents the discount due to the accelerated note encashment (ANE).3 Represents amounts committed per Instrument of Contribution including discount on donor’s contributions due to the ANE for ADF IX totaling $56,758.4 Includes the balance of unamortized discount on donor’s contributions due to the ANE for ADF IX totaling $44,645.5 Includes the amortized discount on donor’s contributions due to the ANE for ADF IX totaling $12,113 and the foregone interest received.6 Excludes advance payments received from donors totaling $124,473, which have not been made available for operational commitments as of 31 December

2008. 7 Includes translation adjustments amounting to $352 as of 31 December 2008.


ADF-7

81Annual Report 2008


NOTES TO SPECIAL PURPOSE FINANCIAL STATEMENTS31 December 2008 and 2007

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NOTE A—NATURE OF OPERATIONS

The Asian Development Fund (ADF) was established

on 28 June 1974 to more effectively carry out the special

operations of the Asian Development Bank (ADB) by

providing resources on concessional terms which are

made available almost exclusively to the least developed

borrowing countries.

The resources of ADF have been subsequently

augmented by eight replenishments, the most recent

of which became effective in April 2005 consisting

of $3,302,547,000 in contributions from donors and

$3,700,000,000 from internal resources to cover the

operational requirements for the four-year period from

January 2005. Under this replenishment, ADB was

authorized to provide financing in the form of grants for

projects and programs of high developmental priority.

In August 2008, the Board of Governors approved

the resolution providing for the ninth replenishment of

the Asian Development Fund (ADF X) and the fourth

regularized replenishment of the Technical Assistance

Special Fund (TASF). The resolution provides for a

substantial replenishment of the ADF to finance ADB’s

concessional program for the four-year period from January

2009, and for a replenishment of the TASF in conjunction

with the ADF replenishment, to finance technical

assistance operations under the fund. Total replenishment

size is SDR7,111,290,000, of which SDR2,641,290,000

will come from new donor contributions. Donors

agreed to allocate 3% of the total replenishment size

(equivalent to 8% of total donor contributions) to TASF.

The replenishment shall be effective upon receipt

of the Instruments of Contribution for Unqualified

Contribution commitments in an aggregate amount

equivalent to at least SDR1,320,645,000, and such date

should not be later than 1 July 2009.

NOTE B— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

In May 2001, the Board of Directors approved the

adoption of the special purpose financial statements for

ADF. Due to the nature and organization of ADF, these

financial statements have been prepared for the spe-

cific purpose of reflecting the sources and applications

of member contributions and are presented in US dollar

equivalents at the reporting dates. With the adoption

of the special purpose financial statements, loan loss

provisioning has been eliminated. With the exceptions

of the aforementioned, the ADF financial statements

are prepared in accordance with accounting principles

generally accepted in the United States of America.

In November 2005, to improve ADF currency

management practices, the Board of Governors accepted

a resolution to adopt a full-fledged special drawing rights

(SDR) approach to facilitate resource administration and

operational planning for the benefit of borrowers. The

currency management framework was implemented on 1

January 2006 whereby ADB is authorized to convert ADF

resources held in various currencies into the currencies

which constitute the SDR, to value disbursements,

repayments and loan charges in terms of SDR, and to

determine the value of contributors’ paid-in contributions

and all other resources of the Fund in terms of SDR, in

case of withdrawal of a Contributor or termination of

ADF.

In July 2007, as an application of the Board-approved

currency management exercise, ADB decided to offer

a full-fledged special drawing rights (SDR) approach

to ADF legacy loans by providing ADF borrowers the

option to convert their existing liability (i.e., disbursed

and outstanding loan balance) in various currencies into

SDR, while the undisbursed portions will be treated as

new loans. The conversion was made available beginning

1 January 2008, and as of 31 December 2008, 16 out

of 30 ADF borrowing countries have opted to convert

their loans, which were carried out on the nearest loan

service payment dates from their concurrence. The

conversion resulted in a realized gain of $2,088,211,000

with a corresponding reduction in other comprehensive

income.

Functional Currencies and Reporting Currency

The implementation of the full-fledged SDR framework

is expected to change the primary economic environment

of ADF. Until this process is completed, and a significant

change in the primary economic environment becomes

evident, the currencies of contributing member countries

are functional currencies as these represent the curren-

cies of the primary economic environment in which ADF

generates and expends cash. The United States dollar is

the reporting currency of the fund.




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ADB adopts the use of daily exchange rates for accounting

and financial reporting purposes. This allows transactions

in currencies other than USD to be translated to the

reporting currency using exchange rates applicable at the

time of transactions. At the end of each accounting month,

translations of assets, liabilities, and amounts available for

operational commitments denominated in non-USD are

adjusted using the applicable rates of exchange at the end

of the reporting period. Translation adjustments relating

to set-aside resources (Note I) are recorded as notional

amounts receivable from or payable to OCR. Translation

adjustments relating to the maintenance of SDR loans

are charged or credited to “Unrealized Gains/Losses” and

reported in the Statement of Revenue and Expenses. All

other translation adjustments are charged or credited to

“accumulated translation adjustments” and reported in

“FUND BALANCES” as part of “Accumulated Other

Comprehensive Income.”

Investments

Investment securities and negotiable certificate of

deposits are classified as “Available for Sale” and are re-

ported at estimated fair value, which represents their fair

market value. Unrealized gains and losses are reported

in “FUND BALANCES” as part of “Accumulated Other

Comprehensive Income.” Realized gains and losses are

measured by the difference between amortized cost and

the net proceeds of sales. Time deposits are reported at

cost, which is a reasonable estimate of fair value.


deposits is recognized as realized and reported, net of


Securities Transferred Under Repurchase Agreement and Securities Purchased Under Resale Arrangement

ADF accounts for transfers of financial assets in ac-


Servicing of Financial Assets and Extinguishments

of Liabilities - a replacement of FAS 125.” In general,

transfers are accounted for as sales when control over

the transferred assets has been relinquished. Otherwise

the transfers are accounted for as repurchase/resale

agreements and collateralized financing arrangements.

Under repurchase agreements, securities transferred are

recorded as assets and reported at estimated fair value

and cash collateral received are recorded as liabilities.

ADB monitors the fair value of the securities transferred

under repurchase agreements and the collateral. Under

resale arrangements, securities purchased are recorded

as assets, while securities received are not recorded as

liabilities and are not re-pledged.

There were no outstanding securities transferred

under repurchase agreement as of 31 December 2008

and 2007.

Loans

Loan interest income is recognized on accrual basis. It

is the policy of ADF to place in non-accrual status loans

made to eligible borrowing member countries if the prin-

cipal or interest with respect to any such loans is overdue

by six months. Interest on non-accruing loans is included

in revenue only to the extent that payments have actu-

ally been received by ADF. ADB maintains a position of

not taking part in debt rescheduling agreements with

respect to sovereign loans. In the case of nonsovereign

loans, ADB may agree to debt rescheduling only after

alternative courses of action have been exhausted. When

ADB decides that a particular loan is no longer collect-

ible, the entire amount is expensed during the period.

Contributed Resources

Contributions by donors are included in the financial

statements as amounts committed and are reported in

“Contributed Resources” as part of Fund Balances from

the date Instruments of Contribution are deposited and

related formalities are completed and made available for

operational commitments.

Contributions are generally received in the currency

of the contributor either in cash or notes.

Under ADF IX, contributors have the option to pay

their contributions under accelerated note encashment

(ANE) program and receive a discount. ADF invests the

cash generated from this program and the investment

income is used to finance operations. The related

contributions are recorded at the full undiscounted

amount, and the discount is amortized over the standard

encashment period of 10 years.




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Advanced Payments on Contributions

Payments received in advance or as qualified contribu-

tions that cannot be made available for operational com-

mitment are recorded as advance payments and included

under “Liabilities.”

Grants and Undisbursed Commitments

Grants are recognized in the financial statements when

the grant is approved and becomes effective. Upon

completion of a project or cancellation of a grant, any

undisbursed amount is written back as a reduction in the

grants for the year and the corresponding undisbursed

commitment is eliminated accordingly.


The preparation of special purpose financial statements

in conformity with generally accepted accounting princi-

ples requires Management to make reasonable estimates

and assumptions that affect the reported amounts of

assets, liabilities, and fund balances as at the end of the

year and the reported amounts of revenue and expenses

during the year. The actual results could differ from

those estimates.



Board (FASB) issued Statement No. 161 “Disclosures

about Derivative Instruments and Hedging Activities

– an amendment of FASB Statement No. 133,” which

will be applicable for fiscal years beginning after 15

November 2008 and interim periods within those fiscal

years. This statement amends and expands the disclosure

requirements of FAS 133 to provide users with better

understanding of (i) how and why an entity uses deriva-

tives; (ii) how derivative instruments and related hedged

items are accounted for under FAS 133 and its related

interpretations; and (iii) how derivative instruments

and hedged items affect an entity’s financial position,

performance, and cash flows. ADB is currently assessing

the impact of this standard on its financial statements.

Special Purpose Statement of Cash Flows

For the purposes of the Special Purpose Statement of

Cash Flows, ADF considers that its cash and cash equiva-

lents are limited to “DUE FROM BANKS.”

NOTE C—INVESTMENTS








The net unrealized gains on the outstanding ANE

portfolio amounted to $19,069,000 ($7,135,000 - 2007).

The currency composition of the investment



Currency 2008 2007

Australian dollar $ – $ 71,531,000Canadian dollar – 44,620,000Euro 2,581,915,000 2,806,481,000Japanese yen 583,470,000 366,715,000Pound sterling 604,228,000 995,227,000United States dollar 2,230,923,000 2,610,150,000 Total $6,000,536,000 $6,894,724,000

The estimated fair value and amortized cost of the

investments as of 31 December 2008 are as follows:

Estimated Amortized Fair Value Cost

Due in one year or less $3,754,777,000 $3,747,964,000Due in one year through five years 2,165,685,000 2,071,155,000Due after five years through ten years 80,074,000 73,768,000

Total $6,000,536,000 $5,892,887,000

ADF-7

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government and government-guaranteed obligations and

corporate bonds is as follows:

2008 2007

As of 31 December: Amortized cost $5,205,740,000 $833,026,000Estimated fair value 5,313,389,000 840,063,000Gross unrealized gains 110,118,000 8,402,000Gross unrealized losses (2,469,000) (1,365,000) For the years ended 31 December: Change in net unrealized gains (losses) from prior year 100,613,000 7,874,000Proceeds from sales 14,350,000 –Gross gain on sales 365,000 –

The rate of return on the average investments held

during the year, including securities transferred under

securities lending arrangement and securities purchased

under resale arrangement, based on the portfolio held

at the beginning and end of each month, was 3.72%

(4.60% - 2007) excluding unrealized gains and losses

on investment securities, and 5.17% (4.72% – 2007)

including unrealized gains and losses on investments.

As of 31 December 2008, gross unrealized losses

amounted to $2,469,000 ($1,365,000 – 2007) from

government and government-guaranteed obligations

and corporate bonds, resulting from market movements.

There are no positions in 2008 that sustained unrealized

losses for over one year, (fifteen positions representing

1.64% of the investments in 2007). Comparative details

for 2008 and 2007 are as follows:



Government and government- guaranteed obligations $ 28,416,000 $ 4,000 $ – $ – $ 28,416,000 $ 4,000Corporate bonds 205,417,000 2,465,000 – – 205,417,000 2,465,000

Total $233,833,000 $ 2,469,000 $ – $ – $ 233,833,000 $ 2,469,000



Government and government- guaranteed obligations $ 44,608,000 $ 18,000 $ 82,419,000 $ 1,168,000 $ 127,027,000 $ 1,186,000Corporate bonds 31,361,000 36,000 30,989,000 143,000 62,350,000 179,000

Total $ 75,969,000 $ 54,000 $113,408,000 $ 1,311,000 $ 189,377,000 $ 1,365,000

NOTE D—LOANS AND LOAN LOSS PROVISION

Loans

Prior to 1 January 1999, loans of ADF were extended

to eligible borrowing member countries, which bore

a service charge of 1% and required repayment over

periods ranging from 35 to 40 years. On 14 December

1998, the Board of Directors approved an amendment

to ADF loan terms, as follows: (i) for loans to finance

specific projects, the maturity was shortened to 32 years

including an 8-year grace period; (ii) for program loans

to support sector development, the maturity was short-

ened to 24 years including an 8-year grace period; and

(iii) all new loans bear a 1% interest charge during the

grace period, and 1.5% during the amortization period,

with equal amortization. The revised ADF lending terms

took effect on 1 January 1999 for loans for which formal

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loan negotiations were completed on or after 1 January

1999. ADF requires borrowers to absorb exchange risks

attributable to fluctuations in the value of the currencies

disbursed.

In September 2007, the Board of Directors approved

a new hard-term ADF lending facility. The facility will

have a fixed interest rate of 150 basis points below the

weighted average of the ten-year fixed swap rates of the

special drawing rights component currencies plus the

OCR lending spread, or the current ADF rate, whichever

is higher. Other terms are similar to those of regular ADF

loans. The interest rate will be reset every January and

will apply to all hard-term loans approved that year and

will be fixed for the life of the loan. For hard-term ADF

loans approved in 2008, the interest rate was set at 3.15%

(3.85% – 2007). Three loans were approved under this

facility in 2008 (nil – 2007).

ADB believes that there is no comparable market,

nor ADB intends to sell ADF loans. The use of market

data to arrive at the loan at fair value will give meaningless

results. As such, the fair value of loans is determined based

on the terms at which a similar loan would currently be

made by ADB to a similar borrower. For such loans, fair

value approximates the carrying amount. The estimated

fair value of loans is not affected by credit risks because

the amount of any such adjustment is not considered to

have a material effect based on ADB's experience with

its borrowers.

Undisbursed loan commitments and an analysis of

loans by country as of 31 December 2008 are shown in

ADF-5.

As of 31 December 2008 and 2007, loans to borrowers

that exceeded 5% of the total loans outstanding were as

follows:

2008 2007

Pakistan $ 6,403,379,000 $ 5,444,555,000Bangladesh 5,743,777,000 5,399,187,000Vietnam, Socialist Republic of 2,630,421,000 2,298,804,000Sri Lanka 2,614,832,000 2,539,657,000Nepal 1,564,986,000 1,486,034,000Others (individually less than 5% of total loans) 7,469,894,000 6,849,755,000

Total Outstanding Loans 26,427,289,000 $24,017,992,000

Provision for HIPC Debt Relief (87,471,000) –

Net Outstanding Loans $26,339,818,000 $24,017,992,000

The principal amount outstanding of sovereign

loans in non-accrual status as of 31 December 2008

was $565,751,000 ($488,901,000 – 2007) of which

$263,444,000 ($209,477,000 - 2007) was overdue. Loans

in non-accrual status resulted in $5,176,000 ($4,691,000

– 2007) not being recognized as income from loans for

the year ended 31 December 2008. The accumulated

interest on these loans that was not recognized as income

as of 31 December 2008 would have totaled $63,802,000

($50,260,000 – 2007). The loans in non-accrual status

as of 31 December 2008 were 28 loans to Myanmar

representing 2.1% of the total outstanding loans (28

loans to Myanmar – 2007).

During the period, provision for HIPC debt relief

amounting to $89,788,000 relating to the Afghanistan

debt relief under the HIPC initiative was recognized and

charged to income. Of this amount, a total of $527,000 was

written-off as the loan service payments of some affected

loans fell due. This brought the balance of Provision for

HIPC debt relief as of 31 December 2008, including the

effects of translation adjustments, to $87,471,000 (nil

– 31 December 2007) (See Note M).

NOTE E—DUE FROM CONTRIBUTORS

Included in “Due From Contributors” are notes of

contributors and contributions receivable. Notes of

contributors are non-negotiable, non-interest-bearing

and, subject to certain restrictions imposed by applicable

Board of Governors' resolutions, encashable by ADB at

par upon demand.

ADB currently expects that the notes outstanding

at 31 December 2008 will be encashed in varying amounts

over a six-year period ending 31 December 2014.

The fair value of notes of contributors is determined

based on the terms at which notes are currently being

accepted from contributors. On this basis, the fair value

of outstanding notes of contributors approximates their

carrying amount.

NOTE F—PAYABLE TO RELATED FUNDS

The OCR and special fund resources are at all times

used, committed, and invested entirely separate from

each other. The administrative and operational expenses

pertaining to the OCR and ADF are allocated based on

operational activities and are settled regularly. Under

ADF IX and third regularized replenishment of Technical

CONTINUED




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D Assistance Special Fund (TASF), a specific portion of

the total contributions are to be allocated to TASF. ADF

receives all contributions of members and subsequently

transfers TASF’s portion to TASF.

As of 31 December 2008, $31,743,000 representing

administration charges was payable to OCR ($28,750,000

– 2007). No payable to TASF was outstanding in 2008

while $1,419,000 in 2007 corresponds to contributions

from donors incorporated in ADF IX for the third

regularized replenishment of TASF.

NOTE G—CONTRIBUTED RESOURCES/ OTHER LIABILITIES

As of 31 December 2008, contributions from 30 donors to-

taling $3,431,219,000 (28 donors totaling $3,290,116,000

– 2007) were committed for ADF IX. Of these, contribu-

tions totaling $3,153,949,000 ($2,270,884,000 – 2007),

including amortized discount totaling $12,112,000

($7,523,000 – 2007), were received and made available

for operational commitment. These were recorded in

“Contributed Resources.”

In May 2008, the Board of Governors approved the

allocation of $40,000,000 from OCR's 2007 net income

to ADF.

As of 31 December 2008, Italy's promissory note

received under ADF VI has a remaining balance of

€342,000 ($481,000 equivalent). This was recorded in

Deferred Credits and included in “Other liabilities.”

NOTE H—ADMINISTRATIVE EXPENSES AND ADMINISTRATION CHARGE

Administrative expenses represent administration charge

from OCR which is an apportionment of all administra-

tive expenses of ADB (other than those pertaining

directly to ordinary operations and special operations),

in the proportion of the relative volume of operational

activities of each fund.

NOTE I—SET-ASIDE RESOURCES

Pursuant to the provisions of Article 19, paragraph 1(i)

of the Articles of Agreement Establishing the Asian

Development Bank (the Charter), the Board of Governors

has authorized the setting aside of 10% of the unimpaired

“paid-in” capital paid by member countries pursuant

to Article 6, paragraph 2(a) of the Charter and of the

convertible currency portion paid by member countries

pursuant to Article 6, paragraph 2(b) of the Charter as of

28 April 1973, to be used as a part of the Special Funds

of ADB. The capital so set aside was allocated and trans-

ferred from the OCR to ADF as Set-Aside Resources.

The capital stock of ADB is defined in Article 4,

paragraph 1 of the Charter, “in terms of United States

dollars of the weight and fineness in effect on 31 January

1966” (the 1966 dollar). Therefore, Set-Aside Resources

had historically been translated into the current United

States dollar (ADB's unit of account), on the basis of its

par value in terms of gold. From 1973 until 31 March

1978, the rate arrived at on this basis was $1.20635

per 1966 dollar. Since 1 April 1978, at which time the

Second Amendment to the Articles of Agreement of the

International Monetary Fund (IMF) came into effect,

currencies no longer had par values in terms of gold.

Pending ADB's selection of the appropriate successor to

the 1966 dollar, the Set-Aside Resources have been valued

for purposes of the accompanying financial statements in

terms of the Special Drawing Right (SDR), at the value

in current United States dollars as computed by the IMF.

As of 31 December 2008, the value of the SDR in terms of

the current United States dollar was $1.54781 ($1.57848

- 2007). On this basis, Set-Aside Resources amounted to

$73,691,000 ($75,151,000 - 2007). If the capital stock of

ADB as of 31 December 2008 had been valued in terms

of $12,063.50 per share, Set-Aside Resources would have

been $57,434,000.

NOTE J—COMPREHENSIVE INCOME

Comprehensive Income has two major components:

revenue in excess of (less than) expenses and other

comprehensive income. Other Comprehensive Income

includes unrealized gains and losses on “Available for

Sale” securities and translation adjustments of functional

currencies.

NOTE K—GRANTS AND UNDISBURSED COMMITMENTS

The ADF IX introduced financing in the form of grants

for the first time. As of 31 December 2008 and 2007, 27

grants amounting to $707,360,000 and 24 grants amount-

ing to $519,340,000 were approved, respectively. During

the year, grants totaling $539,800,000 ($377,760,000

– 2007) became effective.

ADF-7




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The fair value of undisbursed commitments

approximates the amount outstanding, because ADB

expects that disbursements will substantially be made for

all the projects/programs covered by the commitments.

NOTE L—FAIR VALUE MEASUREMENTS












FAS 157 also establishes a fair value hierarchy

that gives the highest priority to quoted prices in

active markets for identical assets or liabilities (Level

1), next priority to observable market inputs or market

corroborated data (Level 2), and the lowest priority to

unobservable inputs without market corroborated data

(Level 3). FAS 157 requires the fair value measurement

to maximize the use of market observable inputs.

The following guidelines are applied in determining


Investments, forward contracts, and securities purchased under resale arrangements

Readily marketable investments are fair valued using ac-

tive market quotes in Level 1 category. Level 2 category

includes investments, resale arrangements, and forward

contracts which are fair valued with significant other

market observable inputs. Forward foreign exchange

contracts are fair valued using discounted cash flow

models.

The fair value of the following financial assets of

ADF as of 31 December 2008 were reported based on

the following:

CONTINUED

Fair Value Measurements Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs 31 December 2008 (Level 1) (Level 2) (Level 3)

Assets Investments $6,000,536,000 $3,951,007,000 $2,049,529,000 $ – Securities purchased under resale arrangement 322,361,000 – 322,361,000 – Receivable - forward contracts 307,811,000 – 307,811,000 –

Total $6,630,708,000 $3,951,007,000 $2,679,701,000 $ – Liabilities Payable - forward contracts $ 373,041,000 $ – $ 373,041,000 $ –

See Notes C, D, E, and K for discussions relating

to investments, loans, due from contributors, and

undisbursed commitments. In all other cases, the

carrying amounts of ADF's assets, liabilities, and fund

balances are considered to approximate fair values for all

significant financial instruments.

NOTE M—HEAVILY INDEBTED POOR COUNTRIES (HIPC) INITIATIVE

In April 2008, the Board of Governors adopted the

resolution on Providing Heavily Indebted Poor Countries

(HIPC) Relief from Asian Development Fund Debt, for

ADB to participate in the HIPC debt relief initiative.




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D The HIPC debt relief initiative was launched in

1996 by the International Development Association

(IDA) and International Monetary Fund (IMF) to

address the debt problems of heavily indebted poor

countries to ensure that reform efforts in these countries

are not put at risk due to their high external debt burden.

Under the HIPC debt relief initiative, all bilateral and

multilateral creditors provide debt relief for countries

that demonstrated good policy performance over an

extended period to bring their debt service burden to

sustainable level. As of 31 December 2008, Afghanistan

is the only borrower that has qualified for HIPC debt

relief.

ADF-7

89Annual Report 2008TEC

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TECHNICAL ASSISTANCE SPECIAL FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

Asian Development Bank90TE

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In our opinion, the accompanying statements of financial position and the related statements of ac-

tivities and changes in net assets and cash flows present fairly, in all material respects, the financial

position of the Asian Development Bank (“ADB” or “the Bank”)—Technical Assistance Special Fund

at 31 December 2008 and 2007, and the results of its activities and changes in net assets and its cash

flows for the years then ended, in conformity with accounting principles generally accepted in the

United States of America. Also in our opinion, management’s assertion that ADB maintained effective

internal control over financial reporting as of 31 December 2008 is fairly stated, in all material respects,

based on criteria established in Internal Control – Integrated Framework issued by the Committee of

Sponsoring Organizations of the Treadway Commission (COSO). The management of ADB is respon-

sible for these financial statements, for maintaining effective internal control over financial reporting

and for its assertion of the effectiveness of internal control over financial reporting, included in the

accompanying Management's Report on Internal Control over Financial Reporting. Our responsibil-

ity is to express opinions on these financial statements and on ADB’s internal control over financial

reporting based on our integrated audit in 2008 and financial statement audit in 2007. We conducted

our audits of the financial statements in accordance with auditing standards generally accepted in

the United States of America and our audit of internal control over financial reporting in accordance





statements included examining, on a test basis, evidence supporting the amounts and disclosures in

the financial statements, assessing the accounting principles used and significant estimates made











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Our audits were conducted for the purpose of forming an opinion on the basic financial state-

ments taken as a whole. The accompanying statement of resources as at 31 December 2008

and summary statement of technical assistance approved and effective for the year ended

31 December 2008 are presented for purposes of additional analyses and are not required parts of

the basic financial statements. Such information has been subjected to the auditing procedures ap-

plied in the audits of the basic financial statements and in our opinion, is fairly stated in all material

respects in relation to the basic financial statements taken as a whole.



















Singapore

5 March 2009


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TASF-1

ASIAN DEVELOPMENT BANK—TECHNICAL ASSISTANCE SPECIAL FUND

STATEMENT OF FINANCIAL POSITION 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

ASSETS

DUE FROM BANKS (Note B) $ 1,692 $ 1,306 INVESTMENTS (Notes B, C, and G) Time deposits $156,114 $295,078 Corporate bonds 139,429 295,543 – 295,078 SECURITIES PURCHASED UNDER RESALE ARRANGEMENT (Notes B and G) 111 – ACCRUED REVENUE 124 788 DUE FROM CONTRIBUTORS (Notes B and F) 17,304 68,489 OTHER ASSETS (Note D) 10,674 11,264 TOTAL $325,448 $376,925

LIABILITIES AND UNCOMMITTED BALANCES

MISCELLANEOUS LIABILITIES (Note D) $ 19 $ 88

UNDISBURSED COMMITMENTS (Notes B, E, and G) 222,722 183,718

UNCOMMITTED BALANCES (TASF-2 and TASF-4) (Notes B and F), represented by: Unrestricted net assets 102,707 193,119

TOTAL $325,448 $376,925

The accompanying notes are an integral part of these financial statements (TASF-6).


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STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Years Ended 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

2008 2007

CHANGES IN UNRESTRICTED NET ASSETS

CONTRIBUTIONS (TASF-4) (Notes B and F) $ 30,269 $ 52

REVENUE From investments (Notes B and C) 10,880 14,162 From other sources—net (Note E) 138 195

Total 41,287 14,409

EXPENSES Technical assistance—net (TASF-5) (Notes B and E) 108,159 77,532 Financial expenses 8 5

Total 108,167 77,537

CONTRIBUTIONS AND REVENUE LESS THAN EXPENSES (66,880) (63,128)

EXCHANGE (LOSSES) GAINS—net (Note B) (23,532) 35,714

DECREASE IN NET ASSETS (90,412) (27,414)

NET ASSETS AT BEGINNING OF YEAR 193,119 220,533

NET ASSETS AT END OF YEAR $102,707 $193,119



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TASF-3



2008 2007 CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ 85,526 $ 51,698 Interest on investments received 9,972 14,721 Cash received from other sources 172 199 Technical assistance disbursed (70,044) (77,872) Financial expenses paid (9) (5) Net Cash Provided by (Used in) Operating Activities 25,617 (11,259) CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 11,780,926 3,513,304 Purchases of investments (11,804,622) (3,502,634) Net payments for securities purchased under resale arrangement (290) (198) Net Cash (Used in) Provided by Investing Activities (23,986) 10,472 Effect of Exchange Rate Changes on Due from Banks (1,245) 265 Net Increase (Decrease) in Due from Banks 386 (522) Due from Banks at Beginning of Year 1,306 1,828 Due from Banks at End of Year $ 1,692 $ 1,306 RECONCILIATION OF DECREASE IN NET ASSETS TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES:

Decrease in net assets (TASF-2) $ (90,412) $ (27,414) Adjustments to reconcile decrease in net assets to net cash provided by (used in) operating activities: Amortization of discounts/premiums on investments (1,529) – Change in accrued revenue 622 558 Change in due from contributors 47,187 49,918 Change in other assets (826) 35 Change in miscellaneous liabilities (64) (29) Change in undisbursed commitments 39,004 (344) Translation adjustments 31,635 (33,983) Net Cash Provided by (Used in) Operating Activities $ 25,617 $ (11,259)



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STATEMENT OF RESOURCES 31 December 2008Expressed in Thousands of United States Dollars (Note B)

Contributions Direct Committed Voluntary Regularized Total During 2008 Contributions Replenishment1 Contributions

DIRECT VOLUNTARY CONTRIBUTIONS

Australia $ – $ 2,484 $ 29,368 $ 31,852 Austria – 159 3,793 3,952 Bangladesh – 47 – 47 Belgium – 1,394 3,207 4,601 Canada – 3,346 26,638 29,984 China, People’s Rep. of – 1,600 1,996 3,596 Denmark – 1,963 4,034 5,997 Finland – 237 2,058 2,295 France – 1,698 20,969 22,667 Germany – 3,315 26,642 29,957 Hong Kong, China – 100 1,397 1,497 India 250 3,310 – 3,310 Indonesia – 250 40 290 Italy 6,950 774 16,320 17,094 Japan – 47,710 157,606 205,316 Korea, Rep. of – 1,900 8,104 10,004 Luxembourg – – 238 238 Malaysia – 909 333 1,242 Nauru – – 67 67 The Netherlands – 1,338 11,823 13,161 New Zealand – 1,096 2,234 3,330 Norway – 3,279 4,308 7,587 Pakistan 70 1,736 – 1,736 Portugal – – 1,344 1,344 Singapore – 1,100 266 1,366 Spain – 190 6,189 6,379 Sri Lanka – 6 – 6 Sweden – 861 6,855 7,716 Switzerland – 1,035 5,463 6,498 Taipei,China – 200 1,710 1,910 Thailand – – 202 202 Turkey – – 2,720 2,720 United Kingdom – 5,617 21,662 27,279 United States – 1,500 65,031 66,531

Total $ 7,269 $ 89,154 $ 432,617 $ 521,771

Transfers to Asian Development Fund (3,472)

Allocation from OCR Net Income 23,000 706,000

Other Resources2 178,257

TOTAL $30,269 $1,402,556

Note: Figures may not add to total due to rounding.1 Represents TASF portion of contributions to the replenishment of the Asian Development Fund and the Technical Assistance Special Fund authorized by Governors’

Resolution Nos. 182, 214 and 300 at historical values.2 Represents income, repayments, and reimbursement accruing to TASF since 1980.



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SUMMARY STATEMENT OF TECHNICAL ASSISTANCE APPROVED AND EFFECTIVE For the Year Ended 31 December 2008 Expressed in Thousands of United States Dollars (Note B)

Project Project Implementation/ Recipient Preparation Advisory Total

Afghanistan $ (1,122) $ (2,322) $ (3,444)Armenia 970 600 1,570 Azerbaijan 903 (149) 754 Bangladesh 335 3,791 4,126 Bhutan (6) 1,608 1,602 Cambodia 750 1,995 2,745 China, People’s Rep. of 7,576 9,390 16,966 Cook Islands 125 214 339 Fiji Islands 121 (96) 25 Georgia 600 – 600 India 3,475 9,616 13,091 Indonesia (161) 3,462 3,301 Kazakhstan 300 – 300 Kiribati (47) – (47)Kyrgyz Republic 1,250 (96) 1,154 Lao PDR 500 2,142 2,642 Malaysia – (3) (3)Maldives (57) – (57)Marshall Islands – (47) (47)Micronesia, Fed. States of – (44) (44)Mongolia 367 – 367 Nauru – 225 225 Nepal 180 5,365 5,545 Pakistan 2,121 1,487 3,608 Papua New Guinea (10) 225 215 Philippines – 1,903 1,903 Samoa – (81) (81)Solomon Islands – (161) (161)Sri Lanka 150 541 691 Tajikistan 121 (5) 116 Thailand 270 1,199 1,469 Timor-Leste – (30) (30)Tonga – (45) (45)Tuvalu – 800 800 Uzbekistan 182 903 1,085 Vanuatu – (24) (24)Viet Nam 3,440 1,875 5,315

Total $ 22,333 $ 44,238 66,571

Regional Activities 41,588

TOTAL $ 108,159

Notes: Figures may not add to total due to rounding. Negative amounts represent net undisbursed commitments written back to balances available for future commitments (Notes B and E).


TASF-6





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The Technical Assistance Special Fund (TASF) was

established to provide technical assistance on a grant

basis to developing member countries (DMCs) of the

Asian Development Bank (ADB) and for regional techni-

cal assistance. TASF resources consist of direct voluntary

contributions by members, allocations from the net

income of Ordinary Capital Resources (OCR) and Asian

Development Fund (ADF) contributions, and revenue

from investments and other sources.

The eighth replenishment of the Asian Devel-

opment Fund (ADF IX) and the third regularized

replenishment of the Technical Assistance Special Fund

(TASF) became effective in April 2005. Under the

resolution, a specific portion of the contribution is to be

allocated to TASF.

In August 2008, the Board of Governors adopted

the resolution providing for the ninth replenishment of

the Asian Development Fund (ADF X) and the fourth

regularized replenishment of the TASF. In conjunction

with the ADF replenishment, the resolution provides

for a replenishment of the TASF to finance technical

operations under the fund. Total replenishment size is

SDR7,111,290,000, of which SDR2,641,290,000 will

come from new donor contributions. Donors agreed to

allocate 3% of the total replenishment size (equivalent

to 8% of total donor contributions) to TASF. The

ADF X replenishment shall be effective upon receipt

of the Instruments of Contribution for Unqualified

Contribution commitments in an aggregate amount

equivalent to at least SDR1,320,645,000, and such date

should not be later than 1 July 2009.


Presentation of the Financial Statements

The financial statements of the TASF are presented on

the basis of those for not-for-profit organizations.

TASF reports donors’ contributions of cash and

other assets as unrestricted assets as these are made

available to TASF without conditions other than for the

purpose of pursuing its objectives.

Functional and Reporting Currency

The United States dollar is the functional and report-

ing currency, representing the currency of the primary

economic operating environment of TASF.




tions denominated in non-US dollar to be translated to

the reporting currency using exchange rates applicable

at the time of transactions. Contributions included in

the financial statements during the year are recognized

at applicable exchange rates as of the respective dates

of commitment. At the end of each accounting month,

translations of assets, liabilities, and uncommitted

balances which are denominated in non-US dollar are

adjusted using the applicable rates of exchange at the

end of the reporting period. These translation adjust-

ments are accounted for as exchange gains or losses and

are credited or charged to operations.

Investments

All investment securities held by TASF are reported at

estimated fair value, which represents their fair market

value. Realized and unrealized gains and losses are in-

cluded in revenue. Time deposits are reported at cost

which is a reasonable estimate of fair value.


deposits are recognized as realized and reported, net of


Securities Purchased Under Resale Arrangements

TASF accounts for transfer of financial assets in ac-


Servicing of Financial Assets and Extinguishments of

Liabilities – a replacement of FAS 125.” In general,

transfers are accounted for as sales under FAS 140 when

control over the transferred assets has been relinquished.

Otherwise, the transfers are accounted for as repurchase/

resale arrangements and collateralized financing arrange-

ments. Securities purchased under resale arrangement

are recorded as assets while securities received are not

recorded as liabilities and are not re-pledged.




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Contributions

The contributions from donors and the allocations from

OCR net income are included in the financial statements,

from the date of effectivity of the contribution agreement,

and the Board of Governors’ approval, respectively.

Technical Assistance to Member Countries and Undisbursed Commitments

Technical assistance is recognized in the financial state-

ments when the project is approved and becomes effec-

tive. Upon completion or cancellation of a TA project,

any undisbursed amount is written back as a reduction

in technical assistance for the year and the corresponding

undisbursed commitment is eliminated accordingly.


The preparation of financial statements in conformity

with generally accepted accounting principles requires

Management to make reasonable estimates and assump-

tions that affect the reported amounts of assets and

liabilities and uncommitted balances as at the end of the



those estimates.


For the purposes of the Statement of Cash Flows, the

TASF considers that its cash and cash equivalents are

limited to “DUE FROM BANKS.”









Investment securities and negotiable certificate

of deposits held as of 31 December 2008 are considered

“Available for Sale” and are reported at fair value, which

represents their fair market value. Unrealized gains and

losses are included in revenue from investments.

The currency composition of the investment



Currency 2008 2007

Australian dollar $ 25,642,000 $ 26,278,000Canadian dollar 42,759,000 155,810,000Euro 16,327,000 6,479,000United States dollar 199,591,000 92,493,000Others 11,224,000 14,018,000 Total $295,543,000 $295,078,000

The annualized rate of return on the average

investments held during the year, based on the portfolio

held at the beginning and end of each month was 3.60%

(4.90% – 2007).

NOTE D—RELATED PARTY TRANSACTIONS

The OCR and special fund resources are at all times used,

committed, and invested entirely separate from each other.

Under ADF IX and the third regularized replenishment

of TASF, a specific portion of the total contributions are

to be allocated to TASF. ADF receives all contributions

of members and subsequently transfers TASF’s portion

to TASF. Regional technical assistance projects and

programs may be combined activities between special and

trust funds. Interfund accounts are settled on a regular

basis between TASF and the other funds.

The interfund account balances included in other

assets and miscellaneous liabilities are as follows:

2008 2007Receivable from: OCR $ 12,000 $ – ADF – 1,419,000 JSF 21,000 2,000 RCIF 22,000 – Agency Trust Funds – Net 73,000 –

Total $ 128,000 $1,421,000 Payable to: OCR $ – $ 14,000 Agency Trust Funds – Net – 35,000

Total $ – $ 49,000

TASF-6





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TASF-6

NOTE E—UNDISBURSED COMMITMENTS

Undisbursed commitments are denominated in United

States dollars and represent effective ongoing grant-

financed TA projects/programs which are not yet

disbursed as of the end of the year. During 2008, an

amount of $15,646,000 ($11,875,000 – 2007) represent-

ing completed and canceled TA projects was written

back as a reduction in technical assistance of the period

and the corresponding undisbursed commitment was

eliminated. The fair value of undisbursed commitments

approximates the amounts undisbursed, because ADB

expects that disbursements will be made for all projects/

programs covered by the commitments.

NOTE F— CONTRIBUTIONS AND UNCOMMITTED BALANCES

Since inception in 1967, direct contributions have been

made by 29 member countries. India and Pakistan made

direct and voluntary contribution in 2008 of Rs10,000,000

($250,000 equivalent) and $70,000 respectively.

In 1986, 1992 and 2005, the Board of Governors

of ADB, in authorizing replenishments of the ADF,

provided for allocations to the TASF in aggregate

amounts equivalent to $72,000,000, $141,000,000 and

$220,000,000, respectively, to be used for technical

assistance to ADF borrowing DMCs and for regional

technical assistance. The total amount received for ADF

IX replenishment for the years ended 31 December 2008

and 2007 amounted to $52,434,000 and $51,622,000

respectively, leaving a total of $17,304,000 as due from

contributors ($68,489,000 – 2007).

In 2008, $23,000,000 was allocated out of OCR net

income to TASF bringing the accumulated allocation out

of OCR net income to $706,000,000.

Some of the direct contributions received can be

subject to restricted procurement sources, while some

are given on condition that the technical assistance be

made on a reimbursable basis. The total contributions

received for the years ended 31 December 2008 and

2007 were without restrictions.

Uncommitted balances comprised of amounts which

have not been committed by ADB as at 31 December

2008 and 2007. These balances include approved TA

projects/programs that are not yet effective.

NOTE G—FAIR VALUE MEASUREMENTS






















Investments and securities purchased under resale arrangements



includes investments and securities purchased under

resale arrangements which are fair valued with significant

other market observable inputs.

CONTINUED




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The fair value of the following financial assets of TASF as of 31 December 2008 were reported based on the

following:

See Notes C and E for discussions with respect

to investments and undisbursed commitments,

respectively. In all other cases, the carrying amounts of

TASF's assets, liabilities, and uncommitted balances are

considered to approximate fair values for all significant

financial instruments.


Assets Investments $295,543,000 $ – $295,543,000 $ – Securities purchased under resale arrangement 111,000 – 111,000 –

Total $295,654,000 $ – $295,654,000 $ –

TASF-6

101Annual Report 2008JA

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JAPAN SPECIAL FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

Asian Development Bank102JA

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position of the Asian Development Bank (“ADB” or “the Bank”)—Japan Special Fund at 31 December

2008 and 2007, and the results of its activities and changes in net assets and its cash flows for the

years then ended, in conformity with accounting principles generally accepted in the United States of

America. Also in our opinion, management’s assertion that ADB maintained effective internal control

over financial reporting as of 31 December 2008 is fairly stated, in all material respects, based on

criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsor-

ing Organizations of the Treadway Commission (COSO). The management of ADB is responsible

for these financial statements, for maintaining effective internal control over financial reporting and

for its assertion of the effectiveness of internal control over financial reporting, included in the ac-

companying Management’s Report on Internal Control over Financial Reporting. Our responsibility

is to express opinions on these financial statements and on ADB’s internal control over financial


















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A company’s internal control over financial reporting is a process effected by those charged

with governance, management, and other personnel, designed to provide reasonable assur-

ance regarding the preparation of reliable financial statements in accordance with accounting

principles generally accepted in the United States of America. A company’s internal control

over financial reporting includes those policies and procedures that (i) pertain to the main-

tenance of records that, in reasonable detail, accurately and fairly reflect the transactions and

dispositions of the assets of the company; (ii) provide reasonable assurance that transactions

are recorded as necessary to permit preparation of financial statements in accordance with

generally accepted accounting principles, and that receipts and expenditures of the company

are being made only in accordance with authorizations of management and those charged with

governance; and (iii) provide reasonable assurance regarding prevention, or timely detection of

unauthorized acquisition, use, or disposition of the company’s assets that could have a material

effect on the financial statements.







Singapore

5 March 2009


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JSF-1 ASIAN DEVELOPMENT BANK—JAPAN SPECIAL FUND

STATEMENT OF FINANCIAL POSITION 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

JSF JSF Regular & Regular & ACCSF Supplementary Total ACCSF Supplementary Total

ASSETS

DUE FROM BANKS (Note B) $ 224 $ 489 $ 713 $ 564 $ 185 $ 749 INVESTMENTS (Notes A, B, C, and G) Time deposits 16,133 60,908 77,041 34,958 215,146 250,104 Corporate Obligations 20,009 137,943 157,952 – – –

36,142 198,851 234,993 34,958 215,146 250,104 ACCRUED REVENUE 85 378 463 44 247 291 OTHER ASSETS (Notes B and D)1 – 2,273 2,231 18 4,497 4,428

TOTAL1 $36,451 $201,991 $238,400 $35,584 $220,075 $255,572


ACCOUNTS PAYABLE AND OTHER LIABILITIES (Note D)1 $ 42 $ 236 $ 236 $ 87 $ 296 $ 296 UNDISBURSED COMMITMENTS (Notes B, E, and G) Technical assistance 223 95,825 96,048 793 82,925 83,718 TOTAL LIABILITIES1 265 96,061 96,284 880 83,221 84,014 NET ASSETS (JSF-2) (Note B), represented by: Uncommitted balances (Notes B and F) Unrestricted – 105,930 105,930 – 136,854 136,854 Temporarily restricted 28,009 – 28,009 27,545 – 27,545 28,009 105,930 133,939 27,545 136,854 164,399 Net accumulated investment income (Notes B and F) Temporarily restricted 8,177 – 8,177 7,159 – 7,159 36,186 105,930 142,116 34,704 136,854 171,558

TOTAL1 $36,451 $201,991 $238,400 $35,584 $220,075 $255,572

The accompanying notes are an integral part of these financial statements (JSF-4).

1 Totals may not add up due to elimination of interfund account of $42,000 ($87,000 - 2007).


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JSF-2

ASIAN DEVELOPMENT BANK—JAPAN SPECIAL FUND

STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007



CONTRIBUTIONS (Notes B and F) $ – $ 17,373 $ 17,373 $ – $ 27,674 $ 27,674 REVENUE FROM INVESTMENTS (Notes B and C) – 6,459 6,459 – 11,807 11,807 REVENUE FROM OTHER SOURCES – 91 91 – 198 198 NET ASSETS REVERTED BACK TO TEMPORARILY RESTRICTED ASSETS (Notes B and F) (437) – (437) (26) – (26)

Total (437) 23,923 23,486 (26) 39,679 39,653 EXPENSES Technical assistance—net (Notes B, E, and F) (449) 53,812 53,363 (37) 32,521 32,484 Administrative expenses (Note F) 12 1,278 1,290 11 1,235 1,246 Financial expenses 0 0 0 – 0 0

Total (437) 55,090 54,653 (26) 33,756 33,730 CONTRIBUTIONS AND REVENUE (LESS THAN) IN EXCESS OF EXPENSES – (31,167) (31,167) – 5,923 5,923

EXCHANGE GAINS (LOSSES) (Note B) – 243 243 – (12) (12) (DECREASE) INCREASE IN UNRESTRICTED NET ASSETS – (30,924) (30,924) – 5,911 5,911

CHANGES IN TEMPORARILY RESTRICTED NET ASSETS

REVENUE FROM INVESTMENTS AND OTHER SOURCES (Notes B and C) 1,045 – 1,045 1,829 – 1,829

NET ASSETS REVERTED BACK TO TEMPORARILY RESTRICTED ASSETS (Notes B and F) 437 – 437 26 – 26

INCREASE IN TEMPORARILY RESTRICTED NET ASSETS 1,482 – 1,482 1,855 – 1,855

INCREASE (DECREASE) IN NET ASSETS 1,482 (30,924) (29,442) 1,855 5,911 7,766

NET ASSETS AT BEGINNING OF YEAR 34,704 136,854 171,558 32,849 130,943 163,792

NET ASSETS AT END OF YEAR $36,186 $105,930 $142,116 $34,704 $136,854 $171,558

0 – Less than $500.



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JSF-3


STATEMENT OF CASH FLOWS For the Years Ended 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

2008 2007


CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ – $ 17,373 $ 17,373 $ – $ 27,674 $ 27,674 Interest on investments received 952 5,559 6,511 1,750 12,727 14,477 Technical assistance disbursed (148) (38,669) (38,817) (380) (35,178) (35,558) Administrative expenses paid (12) (1,337) (1,349) (11) (1,172) (1,183) Financial expenses paid (0) (0) (0) – (0) (0) Cash received from other sources 15 89 104 90 254 344

Net Cash Provided by (Used in) Operating Activities 807 (16,985) (16,178) 1,449 4,305 5,754

CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 1,075,733 5,521,344 6,597,077 630,096 3,221,747 3,851,843 Purchases of investments (1,076,880) (5,504,281) (6,581,161) (632,846) (3,228,829) (3,861,675) Net receipts from (payments for) securities purchased under resale arrangement – 264 264 – (78) (78)

Net Cash (Used in) Provided by Investing Activities (1,147) 17,327 16,180 (2,750) (7,160) (9,910)

Effect of Exchange Rate Changes on Due from Banks – (38) (38) – 5 5

Net (Decrease) Increase in Due from Banks (340) 304 (36) (1,301) (2,850) (4,151)

Due from Banks at Beginning of Year 564 185 749 1,865 3,035 4,900

Due from Banks at End of Year $ 224 $ 489 $ 713 $ 564 $ 185 $ 749

RECONCILIATION OF INCREASE (DECREASE) IN NET ASSETS TO NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES: Increase (decrease) in net assets (JSF-2) $ 1,482 $ (30,924) $ (29,442) $ 1,855 $ 5,911 $ 7,766 Adjustments to reconcile increase (decrease) in net assets to net cash provided by (used in) operating activities: Amortization of discounts on investments (4) (613) (617) – – – Unrealized investment gains (33) (156) (189) – – – Change in undisbursed commitments (571) 12,901 12,330 (466) (2,592) (3,058) Translation adjustment – (244) (244) – 67 67 Others-net (67) 2,051 1,984 60 919 979

Net Cash Provided by (Used in) Operating Activities $ 807 $ (16,985) $ (16,178) $ 1,449 $ 4,305 $ 5,754

0 – Less than $500.


JSF-4




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The Japan Special Fund (JSF) was established in

March 1988 when Government of Japan and the Asian

Development Bank (ADB) entered into a financial ar-

rangement whereby Government of Japan agreed to make

an initial contribution and ADB became the administra-

tor. The purpose of JSF is to help developing member

countries (DMCs) of ADB restructure their economies

and broaden the scope of opportunities for new invest-

ments, thereby assisting the recycling of funds to DMCs

of ADB. While JSF resources are used mainly to finance

technical assistance (TA) operations, these resources

may also be used for equity investment operations in

ADB’s DMCs. Under the agreement between ADB and

Japan, ADB may invest the proceeds of JSF pending

disbursement.

In March 1999, the Board approved the acceptance

and administration by ADB of the Asian Currency Crisis

Support Facility (ACCSF) to assist Asian currency

crisis-affected member countries (CAMCs). Funded by

Government of Japan, ACCSF was established within

JSF to assist in the economic recovery of CAMCs through

interest payment assistance (IPA) grants, TA grants, and

guarantees. With the general fulfillment of the purpose

of the facility, Government of Japan and ADB agreed to

terminate the ACCSF on 22 March 2002. The ACCSF

account is to be kept open until the completion of all TA

disbursements and the settlement of all administrative

expenses.



The financial statements of JSF are presented on the

basis of those for not-for-profit organizations and as

unrestricted and temporarily restricted net assets.

ACCSF funds are separately reported in the financial

statements.

JSF reports the contributions of cash and other

assets as restricted support if they are received with

donor stipulations that limit the use of the donated

assets. When the donor restriction expires, that is, when

a stipulated time or purpose restriction is accomplished,

temporarily restricted net assets are reclassified to

unrestricted net assets and reported in the Statement of

Activities and Changes in Net Assets as “NET ASSETS

RELEASED FROM RESTRICTIONS.”




economic operating environment of JSF.
















Investments

All investment securities held by JSF are reported at









JSF accounts for transfer of financial assets in accordance

with FAS 140, “Accounting for Transfers and Servicing

of Financial Assets and Extinguishments of Liabilities

– a replacement of FAS 125.” In general, transfers are

accounted for as sales under FAS 140 when control over

the transferred assets has been relinquished. Otherwise,

the transfers are accounted for as repurchase/resale ar-

rangements and collateralized financing arrangements.

Securities purchased under resale arrangement are




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recorded as assets while securities received are not

recorded as liabilities and are not re-pledged.

There were no outstanding securities purchased

under resale arrangements as of 31 December 2008 and

2007.

Contributions

Contributions by Japan are included in the financial state-

ments from the date indicated by Japan that funds are

expected to be made available. Contributions which are

restricted by the donor for specific TA projects/programs

or for IPA grants are classified as temporarily restricted

contributions. Those without any stipulation as to spe-

cific use are accounted for and reported as unrestricted

contributions.

Technical Assistance and Undisbursed Commitments

Technical assistance is recognized in the financial state-

ments when the project is approved and becomes effec-

tive. Upon completion of a TA project or cancellation

of a grant, any undisbursed amount is written back as a

reduction in the TA for the year and the corresponding

undisbursed commitment is eliminated accordingly.

Advances are provided from technical assistance

grant funds to the executing agency or co-operating

institution, for the purpose of making payments

for eligible expenses. The advances shall be subject

to liquidation and charged against undisbursed

commitment, any unutilized portion shall be refunded

to the fund. These are included in other assets.




Management to make reasonable estimates and as-

sumptions that affect the reported amounts of assets

and liabilities as at the end of the year and the reported

amounts of income and expenses during the year. The

actual results could differ from those estimates.


For the purposes of the Statement of Cash Flows, the JSF

considers that its cash and cash equivalents are limited to

“DUE FROM BANKS.”














The annualized rates of return on the average

investments held under ACCSF and JSF funds during

the year, based on the portfolio held at the beginning and

end of each month were 2.90% and 2.94%, respectively

(5.24% and 5.26%, respectively - 2007).


The Ordinary Capital Resources (OCR) and special fund

resources are at all times used, committed, and invested

entirely separate from each other. The administrative

and operational expenses pertaining to OCR and special

fund resources are charged to the respective funds. The

administrative expenses of JSF are settled on a regular ba-

sis between OCR and JSF. Regional technical assistance

projects and programs may be combined activities between

special and trust funds. Interfund accounts are settled on

a regular basis between JSF and the other funds.

The interfund balances between other funds,

which are included in other assets and liabilities are as

follows:

2008 2007Amounts Receivable by:

JSF from: ACCSF $ 42,000 $ 87,000 Agency Trust Funds 19,000 –

Total $ 61,000 $ 87,000

Amounts Payable by:

JSF to: OCR $145,000 $159,000 TASF 21,000 2,000 Agency Trust Funds – 24,000

Total $166,000 $185,000

ACCSF to: JSF $ 42,000 $ 87,000

JSF-4




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States dollars and represent effective TA projects/pro-

grams not yet disbursed. Completed but partially can-

celled TA projects amounting to $6,883,000 was written

back as a reduction in technical assistance during 2008

($4,749,000 – 2007), and the corresponding undisbursed

commitments was eliminated. Out of this amount,

$449,000 ($37,000 – 2007) corresponds to ACCSF. The

fair value of undisbursed commitments approximates

the amounts outstanding, because ADB expects that

disbursements will substantially be made for all the

projects/programs covered by the commitments.

NOTE F—CONTRIBUTIONS AND UNCOMMITTED BALANCES

All contributions for the years ended 31 December 2008

and 2007 were received during the respective years.

Effective 31 December 2002, all remaining

temporarily restricted net assets under JSF were

transferred and integrated into the unrestricted regular

net assets, as concurred by Japan, in order to optimize

the use of JSF. Similarly, Japan lifted the restriction

over the use of net accumulated investment income,

which under the original terms of agreement between

ADB and Japan, may only be used for defraying JSF’s

administrative expenses. Japan agreed to use the net

accumulated investment income as additional resources

for funding future ADB operations.

Uncommitted balances comprised of amounts

which have not been committed by ADB as at

31 December 2008 and 2007. These balances include

approved TA projects/programs that are not yet

effective.

As of 31 December 2008 and 2007 these balances

are as follows:

2008 2007

JSF JSF Regular and Regular and ACCSF Supplementary Total ACCSF Supplementary Total Uncommitted balances $28,009,000 $105,930,000 $133,939,000 $27,545,000 $136,854,000 $164,399,000

TA projects/programs approved by Japan and ADB but not yet effective – (14,840,000) (14,840,000) – (20,135,000) (20,135,000)

TA projects/programs approved by Japan and not yet effective – (4,300,000) (4,300,000) – (12,925,000) (12,925,000)

Uncommitted balances available for new commitments $28,009,000 $86,790,000 $114,799,000 $27,545,000 $103,794,000 $131,339,000

The temporarily restricted uncommitted balance

remaining available as of 31 December 2008 corresponds

to funds under ACCSF of $28,009,000 ($27,545,000

- 2007) to cover completion of TA disbursements and

the amount of net accumulated investment income of

$8,177,000 ($7,159,000 – 2007) for settlement of all

administrative expenses.

Net assets reverted back to temporarily restricted

assets under ACCSF relate to savings on financially

completed technical assistance net of amount from

accumulated investment income, released from

restrictions to defray the administrative expenses of

ACCSF.

CONTINUED




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Assets Investments $234,993,000 $12,185,000 $222,808,000 $ –






























JSF as of 31 December 2008 were reported based on the

following:

See Notes C and E for discussions relating to

investments and undisbursed commitments. In all other

cases, the carrying amounts of JSF’s assets, liabilities, and

uncommitted balances are considered to approximate

fair values for all significant financial instruments.

JSF-4


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In our opinion, the accompanying statement of financial position and the related statements of ac-

tivities and changes in net assets, and cash flows present fairly, in all material respects, the financial

position of the Asian Development Bank (“ADB” or “the Bank”)—Asian Development Bank Institute

Special Fund at 31 December 2008 and 2007, and the results of its operations and its cash flows for

the years then ended, in conformity with accounting principles generally accepted in the United

States of America. These financial statements are the responsibility of the management of the Asian

Development Bank Institute. Our responsibility is to express an opinion on these financial state-

ments based on our audits. We conducted our audits of these statements in accordance with auditing

standards generally accepted in the United States of America. Those standards require that we plan

and perform the audit to obtain reasonable assurance about whether the financial statements are

free of material misstatement. An audit includes examining, on a test basis, evidence supporting the

amounts and disclosures in the financial statements, assessing the accounting principles used and

significant estimates made by management, and evaluating the overall financial statement presenta-

tion. We believe that our audits provide a reasonable basis for our opinion.



Singapore

5 March 2009





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ADBISF-1

ASIAN DEVELOPMENT BANK—ASIAN DEVELOPMENT BANK INSTITUTE SPECIAL FUND

STATEMENT OF FINANCIAL POSITION 31 December 2008 and 2007Expressed in Thousands of United States Dollars (Note B)

2008 2007

ASSETS

DUE FROM BANKS (Note B) $ 304 $ 603

INVESTMENTS (Notes B, C, and D) Time deposits – 6,749

SECURITIES PURCHASED UNDER RESALE ARRANGEMENT (Notes B, C, and D) 10,405 1,157

PROPERTY, FURNITURE, AND EQUIPMENT (Notes B and E) One-time Establishment Cost and Furnitures $3,398 $2,733 Less–allowance for depreciation 3,398 – 2,733 –

Leased Property 243 196 Less–allowance for depreciation 146 97 78 118

DUE FROM CONTRIBUTORS (Note F) 7,759 11,716

OTHER ASSETS 2,512 2,024

TOTAL $21,077 $22,367


ACCOUNTS PAYABLE AND OTHER LIABILITIES (Notes B, E, and H) $ 5,354 $ 4,075

UNCOMMITTED BALANCES (ADBISF-2) Unrestricted net assets 15,723 18,292

TOTAL $21,077 $22,367

The accompanying notes are an integral part of these financial statements (ADBISF-4)


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ADBISF-2



2008 2007


CONTRIBUTIONS (Notes B and F) $ 7,759 $ 11,716 REVENUE Income from investments (Notes B and C) 85 71 Income from other sources (Note G) 256 7

Total 8,100 11,794 EXPENSES Administrative expenses 9,743 8,782 Program expenses 3,814 2,388

Total 13,557 11,170 CONTRIBUTIONS AND REVENUE (LESS THAN) IN EXCESS OF EXPENSES (5,457) 624 EXCHANGE LOSSES—NET (159) (93) TRANSLATION ADJUSTMENTS (Note B) 3,337 730 EFFECT OF FASB STATEMENT NO. 158 (Note I) (290) (377) (DECREASE) INCREASE IN UNRESTRICTED NET ASSETS (2,569) 884 NET ASSETS AT BEGINNING OF YEAR 18,292 17,408

NET ASSETS AT END OF YEAR $ 15,723 $ 18,292

The accompanying notes are an integral part of these financial statements (ADBISF-4).


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ADBISF-3



2008 2007

CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ 12,163 $ 11,144 Interest on investments received 87 70 Expenses paid (13,009) (10,839) Others—net 97 (86) Net Cash (Used in) Provided by Operating Activities (662) 289 CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 220,580 155,105 Purchases of investments (212,945) (156,267) Net (payments for) receipts from securities under resale arrangement (7,406) 511 Net Cash Provided by (Used in) Investing Activities 229 (651) Effect of Exchange Rate Changes on Due from Banks 134 269 Net Decrease in Due from Banks (299) (93) Due from Banks at Beginning of Year 603 696 Due from Banks at End of Year $ 304 $ 603 RECONCILIATION OF (DECREASE) INCREASE IN UNRESTRICTED NET ASSETS TO NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES: (Decrease) Increase in unrestricted net assets (ADBISF-2) $ (2,569) $ 884 Adjustments to reconcile (decrease) increase in unrestricted net assets to net cash (used in) provided by operating activities: Depreciation 48 177 Change in due from contributors 4,404 (572) Change in other assets (488) (233) Change in accounts payable and other liabilities 1,279 808 Translation adjustments (3,337) (730) Others—net 1 (45) Net Cash (Used in) Provided by Operating Activities $ (662) $ 289

The accompanying notes are an integral part of these financial statements (ADBISF-4).

ADBISF-4




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In 1996, the Asian Development Bank (ADB) approved

the establishment of the Asian Development Bank

Institute (the Institute) in Tokyo, Japan as a subsidiary

body of ADB. The Institute commenced its operations

upon the receipt of the first funds from Japan on 24 March

1997, and it was inaugurated on 10 December 1997. The

Institute’s funds may consist of voluntary contributions,

donations, and grants from ADB member countries,

non-government organizations, and foundations. The

objectives of the Institute, as defined under its Statute,

are the identification of effective development strate-

gies and capacity improvement for sound development

management in developing member countries.



The financial statements of the Institute are presented

on the basis of those for not-for-profit organizations.

The Institute reports donor’s contributed cash

and other assets as unrestricted support as these are

made available to the Institute without conditions other

than for the purposes of pursuing the objectives of the

Institute.

Functional Currency and Reporting Currency

The functional currency of the Institute is the Japanese

yen. The reporting currency is the United States dollar.


Assets, liabilities, and uncommitted balances are trans-

lated from the functional currency to the reporting

currency at the applicable rates of exchange at the end

of a reporting period. Commitments included in the

financial statements during the year are recognized at

the applicable exchange rates as of the respective dates

of commitment. Revenue and expense amounts in cur-

rency other than the United States dollar are translated

for each semi-monthly period generally at the applicable

rates of exchange at the beginning of each period; such

practice approximates the application of average rates in

effect during the period. Translation adjustments are ac-

counted for as exchange gains or losses and are credited

or charged to operations.

Investments

All investment securities held by the Institute are re-

ported at estimated fair value which represents their fair

market value. Realized and unrealized gains and losses

are included in revenue. Time deposits are reported at

cost which is a reasonable estimate of fair value.


ADBI accounts for transfer of financial assets in accordance

with FAS 140, “Accounting for Transfers and Servicing

of Financial Assets and Extinguishments of Liabilities

– a replacement of FAS 125.” In general, transfers are

accounted for as sales under FAS 140 when control over

the transferred assets has been relinquished. Otherwise,

the transfers are accounted for as repurchase/resale ar-

rangements and collateralized financing arrangements.

Securities purchased under resale arrangement are

recorded as assets and reported at estimated fair value,

while securities received are not recorded as liabilities

and are not re-pledged.

Property, Furniture, and Equipment

Property, furniture, and equipment are stated at cost and

depreciated over their estimated useful lives using the

straight-line method. Maintenance, repairs and minor

betterments are charged to expense.

The Institute distinguishes between capital

leases and operating leases based on the objective of

the expenditure. Expenditures amounting to more

than $30,000 for a single asset or a combination of

assets forming an integral part of a separate asset are

capitalized.

Contributions

Contributions from donors are included in the financial

statements from the date committed.


The preparation of the financial statements in conformity





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Management to make estimates and assumptions that

affect the reported amounts of assets and liabilities as at

the end of the year and the reported amounts of revenue

and expenses during the year. Actual results could differ

from those estimates.


In December 2008, the FASB issued FASB Staff Position

(FSP) FAS 132(R)-1, which amends 132(R) to require

more detailed disclosures about employers' plan assets,

including employers' investment strategies, major cat-

egories of plan assets, concentration of risk within plan

assets, and valuation techniques used to measure the fair

value of plan assets. This aims to address financial state-

ment users' concerns “about the lack of transparency

surrounding the types of assets and associated risks in an

employer's defined benefit pension or other postretire-

ment plan and events in the economy and markets that

could have a significant effect on the value of the plan

assets.” An entity must provide the FSP's disclosures

in financial statements for fiscal years ending after 15

December 2009.


For the purposes of the Statement of Cash Flows, the

Institute considers that its cash and cash equivalents are

limited to “DUE FROM BANKS.”

Reclassification

Certain non-material reclassifications of prior year’s

amounts and information have been made to conform to

the current year’s presentation.


The main investment management objective is to

maintain security and liquidity. Subject to these param-

eters, ADB administers the Institute’s investments and

seeks the highest possible return on its investments.



in 2006. The review endorsed a portfolio approach that is


The investment portfolio was composed wholly

of investments denominated in Japanese yen as of 31

December 2007. All such investments were due within

one year. The total investment income reported as of

31 December 2008 consisted of interest income earned

during the year.


investments held during the year including receivable

for securities purchased under resale arrangement, based

on the portfolio held at the beginning and end of each

month was 0.58% (0.58% - 2007).

NOTE D—FAIR VALUE MEASUREMENTS





























ADBISF as of 31 December 2008 were reported based

on the following:

ADBISF-4




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See Note B for discussions relating to investments

and securities purchased under resale arrangements. In

all other cases, the carrying amounts of ADBISF's assets,

liabilities, and uncommitted balances are considered

to approximate fair values for all significant financial

instruments.

NOTE E—LEASED ASSETS

On 6 January 2006, the Institute concluded an agreement

regarding the lease of a server, which requires ADBI to

pay a total amount of $205,000 over the period of 60

months for the lease of the server.

The following is a schedule by years of future

minimum lease payments under capital lease together

with present value of the net minimum lease payment as

of 31 December 2008:

Year ending 31 December 2009 $ 53,000 2010 53,000

Total minimum lease payment 106,000 Less: Amount representing interest 3,000

Present value of net minimum lease payments $103,000

NOTE F—CONTRIBUTIONS

In 2008, the Government of Japan committed its 13th

contribution to ADBI amounting to ¥700,900,000

($7,759,000 equivalent), which was transferred to the

Fund on 15 January 2009. The amount contributed was

reported in 31 December 2008 balance sheet as “Due

from Contributors.”

NOTE G—INCOME FROM OTHER SOURCES

Income from other sources in 2008 primarily consists

of sublease rental income of $171,000, received accord-

ing to a space sharing agreement with the Japanese

Representative Office of ADB. The transactions with

ADB were made in the ordinary course of business and

were negotiated at arm's length.

NOTE H—DUE TO ADB

Accounts payable and other liabilities include amounts

due to ADB of $847,000 and $341,000 at 31 December

2008 and 2007, respectively. The payable results from

transactions in the normal course of business.

NOTE I—STAFF RETIREMENT PLAN AND POSTRETIREMENT MEDICAL BENEFITS

Staff Retirement Plan

The Institute participates in the contributory defined

benefit Staff Retirement Plan (the Plan) of ADB. Every

employee, as defined under the Plan, shall, as a condi-

tion of service, become a participant from the first day of

service, provided that at such a date, the employee has

not reached the normal retirement age of 60. Retirement

benefits are based on length of service and highest aver-

age remuneration during two years of eligible service. The

Plan assets are segregated and are not included in the

accompanying Balance Sheet. The costs of administering

the Plan are absorbed by ADB, except for fees paid to

the investment managers and related charges, including

custodian fees, which are borne by the Plan.

Participants hired on or before 30 September 2006

are required to contribute 9 1/3% of their salary to the

Plan while those hired after that date do not anymore


Assets Securities purchased under resale arrangement $10,405,000 $ – $10,405,000 $ –

CONTINUED




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contribute to the plan. Participants may also make

additional voluntary contributions. ADBI's contribution

is determined at a rate sufficient to cover that part of

the costs of the Plan not covered by the participants'

contributions.

Expected Contributions

The expected amount of contributions to the Plan for

2009, based on the Institute’s contribution rate for the

coming year of 19%, and the participants’ mandatory con-

tribution are $221,000 and $62,000, respectively (2007

- $158,000 and $58,000).

Investment Strategy

Contributions in excess of current benefits payments

are invested in international financial markets and in a

variety of investment vehicles. The Plan employs nine

external asset managers and one global custodian who

function within the guidelines established by the Plan’s

Investment Committee. The investment of these assets,

over the long term, is expected to produce higher returns

than short-term investments. The investment policy

incorporates the Plan’s package of desired investment re-

turn, and tolerance for risk, taking into account the nature

and duration of the Plan’s liabilities. The Plan’s assets are

diversified among different markets and different asset

classes. The use of derivatives for speculation, leverage or

taking risks is prohibited. Selected derivatives are used

for hedging and transactional efficiency purposes.

The Plan’s investment policy is periodically

reviewed and revised to reflect the best interest of the

Plan’s participants and beneficiaries. The current policy,

adopted in January 2003, specifies an asset-mix structure

of 70% of assets in equities and 30% in fixed income

securities.

At present, investments of the Plan’s assets are

divided into three categories: US equity, Non-US equity,

and US fixed income.

As of 31 December 2008 and 2007, the breakdown

of the fair value of plan assets held is as follows:

2008 2007

Amount Percentage Amount Percentage

Equity Securities US $ 770,000 $1,139,000 Non-US 518,000 856,000

1,288,000 58.6% 1,995,000 73.0%

Fixed income securities 872,000 39.7 762,000 27.9 Other Assets (Liabilities)—net 38,000 1.7 (24,000) (0.9)

Total $2,198,000 100.0% $2,733,000 100.0%

All investments, excluding time deposits, are

valued using market prices. Time deposits are reported

at cost which is the reasonable estimate of the fair value.

Fixed income securities include US government and

government guaranteed obligations, corporate bonds and

time deposits. Other assets include forward exchange

contracts in various foreign currencies transacted to

hedge currency exposure in the investment portfolio,

which are reported at fair value.

For the year ended 31 December 2008 the net

return on the Plan assets was -29.5% (6.0% – 2007). ADB

expects the long-term rate of return on the assets to be

8%.

Assumptions

The assumed overall rate of return takes into account

long-term return expectations of the underlying as-

set classes within the investment portfolio mix, and

the expected duration of the Plan’s liabilities. Return

expectations are forward looking and, in general, not

much weight is given to short-term experience. Unless

there is a drastic change in investment policy or market

environment, the assumed investment return of 8% on

the Plan’s assets is expected to remain broadly the same,

year to year.

ADBISF-4




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Postretirement Medical Benefits Plan

The Institute participates in the cost-sharing plan of

ADB for retirees’ medical insurance premiums. Under

the plan, the Institute is obligated to pay 75% of the

Group Medical Insurance Plan premiums for retirees

and their eligible dependents who elected to participate.

The cost-sharing plan is currently unfunded.

Generally accepted accounting principles require

an actuarially determined assessment of the periodic

cost of postretirement medical benefits.

The following table sets forth the pension and

postretirement benefits at 31 December 2008 and

31 December 2007:

Postretirement Pension Benefits Medical Benefits

2008 2007 2008 2007

Change in benefit obligation: Projected benefit obligation at beginning of year $ 4,960,000 $ 4,269,000 $ 98,000 $ 231,000 Service cost 163,000 126,000 20,000 14,000 Interest cost 305,000 258,000 7,000 15,000 Plan participants’ contributions 322,000 49,000 – – Transfers – 232,000 – – Actuarial (gain) loss (818,000) 430,000 (8,000) (152,000) Benefits paid (88,000) (404,000) (21,000) (10,000)

Projected benefit obligation at end of year $ 4,844,000 $ 4,960,000 $ 96,000 $ 98,000

Change in plan assets: Fair value of plan assets at beginning of year $ 2,733,000 $ 2,623,000 $ – $ – Actual return on plan assets (851,000) 149,000 – – Employer’s contribution 82,000 84,000 21,000 10,000 Plan participants’ contributions 322,000 49,000 – – Transfers – 232,000 – – Benefits paid (88,000) (404,000) (21,000) (10,000)

Fair value of plan assets at end of year $ 2,198,000 $ 2,733,000 $ – $ –

Funded Status $(2,646,000) $(2,227,000) $ (96,000) $ (98,000)

Amounts recognized in the Balance sheet consist of: Current liability $ – $ – $ – $ – Non-current liability (2,646,000) (2,227,000) (96,000) (98,000)

Net amount recognized $(2,646,000) $(2,227,000) $ (96,000) $ (98,000)

Amounts recognized in the Unrestricted net assets consist of: Net actuarial loss (gain) $ 994,000 $ 761,000 $ (395,000) $ (426,000) Prior service cost (credit) 10,000 15,000 (1,000) (32,000)

Net amount recognized $ 1,004,000 $ 776,000 $ (396,000) $ (458,000)

Weighted-average assumptions as of 31 December Discount rate 7.25% 6.00% 7.25% 6.00% Expected return on plan assets 8.00% 8.00% N/A N/A Rate of compensation increase varies with age and averages 5.05% 4.65% 5.05% 4.65%

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For measurement purposes, a 9.0% annual rate of

increase in the per capita cost of covered health care

benefits was assumed for the valuation as at 31 December

2008. The rate was assumed to decrease gradually to

5.0% for 2013 and remain at that level thereafter.


2008 2007 2008 2007

Components of net periodic benefit cost: Service cost $163,000 $126,000 $ 20,000 $ 14,000 Interest cost 305,000 258,000 7,000 15,000 Expected return on plan assets (226,000) (198,000) – – Amortization of prior service cost 5,000 5,000 (31,000) (31,000) Recognized actuarial loss 26,000 – (39,000) (24,000) Net periodic benefit cost $273,000 $191,000 $(43,000) $(26,000)

The accumulated benefit obligation of the pension

plan as of 31 December 2008 was $4,635,000 ($4,726,000

– 2007).

A one-percentage-point change in assumed health

care cost trend rates would have the following effects:

1-Percentage- 1-Percentage- Point Increase Point Decrease

Effect on total service and interest cost components $ 7,000 $ (5,000)Effect on postretirement benefit obligation 22,000 (19,000)

Estimated Future Benefits Payments

The following table shows the benefit payments expected

to be paid in each of the next five years and subsequent

five years. The expected benefit payments are based

on the same assumptions used to measure the benefit

obligation at 31 December 2008:


2009 $ 215,000 $ –2010 179,000 –2011 209,000 –2012 241,000 –2013 272,000 1,0002014-2018 1,671,000 12,000

ADBISF-4


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ASIAN TSUNAMI FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009


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position of the Asian Development Bank (“ADB” or “the Bank”)—Asian Tsunami Fund at 31 December

2008 and 2007, and the results of its activities and changes in net assets and its cash flows for the

years then ended, in conformity with accounting principles generally accepted in the United States of

America. Also in our opinion, management’s assertion that ADB maintained, effective internal control

over financial reporting as of 31 December 2008 is fairly stated, in all material respects, based on

criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsor-

ing Organizations of the Treadway Commission (COSO). The management of ADB is responsible

for these financial statements, for maintaining effective internal control over financial reporting and

for its assertion of the effectiveness of internal control over financial reporting, included in the ac-

companying Management's Report on Internal Control over Financial Reporting. Our responsibility

is to express opinions on these financial statements and on ADB’s internal control over financial re-

porting based on our integrated audit in 2008 and financial statement audit in 2007. We conducted



















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Singapore

5 March 2009


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ATF-1

ASIAN DEVELOPMENT BANK—ASIAN TSUNAMI FUND


2008 2007

ASSETS

DUE FROM BANKS (Note B) $ 383 $ 161

INVESTMENTS (Notes B, C, and G) Time deposits $ 93,032 $366,524 Corporate bonds 158,256 251,288 – 366,524

ACCRUED REVENUE 731 375

ADVANCES FOR GRANTS (Note B) 43,017 62,443

TOTAL $295,419 $429,503


ACCOUNTS PAYABLE AND OTHER LIABILITIES (Note D) $ 694 $ 363


UNCOMMITTED BALANCES (ATF-2) (Notes B and F), represented by: Unrestricted net assets 46,387 40,008

TOTAL $295,419 $429,503

The accompanying notes are an integral part of these financial statements (ATF-4).


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ATF-2



2008 2007


REVENUE From investments (Notes B and C) $ 9,125 $ 22,257 From other sources 215 $ 9,340 389 $ 22,646

EXPENSES Technical assistance (Notes B and E) – (115) Administrative expenses (Note D) 2,849 2,218 Financial expenses 2 2,851 1 2,104

REVENUE IN EXCESS OF EXPENSES 6,489 20,542

EXCHANGE LOSSES (Note B) (110) (16) INCREASE IN NET ASSETS 6,379 20,526 NET ASSETS AT BEGINNING OF YEAR 40,008 19,482 NET ASSETS AT END OF YEAR $ 46,387 $ 40,008



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ATF-3



2008 2007 CASH FLOWS FROM OPERATING ACTIVITIES Interest on investments received $ 7,622 $ 22,644 Grants / Technical assistance disbursed (121,820) (128,707) Administrative expenses paid (2,178) (2,107) Cash received from other sources 216 387 Net Cash Used in Operating Activities (116,160) (107,783) CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 9,337,364 9,180,041 Purchases of investments (9,220,982) (9,072,380) Net Cash Provided by Investing Activities 116,382 107,661 Net Increase (Decrease) in Due from Banks 222 (122) Due from Banks at Beginning of Year 161 283 Due from Banks at End of Year $ 383 $ 161 RECONCILIATION OF INCREASE IN NET ASSETS TO NET CASH USED IN OPERATING ACTIVITIES:

Increase in net assets (ATF-2) $ 6,379 $ 20,526 Adjustments to reconcile increase in net assets to net cash used in operating activities: Amortization of discounts/premiums on investments (834) – Change in accrued revenue (357) 386 Change in advances for grants 19,427 (20,543) Change in accounts payable and other liabilities 331 110 Change in undisbursed commitments (140,794) (108,262) Change in unrealized investment gains (312) – Net Cash Used in Operating Activities $ (116,160) $ (107,783)


ATF-4




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NOTE A— NATURE OF OPERATIONS

The Asian Tsunami Fund (ATF) was established on 11

February 2005 in response to the special circumstances

surrounding the developing member countries (DMCs)

that were stricken by the effects of the tsunami on 26

December 2004. The purpose of ATF is to provide

emergency grant financing promptly and effectively to

affected DMCs in the form of technical assistance (TAs)

and investment projects to support reconstruction,

rehabilitation and associated development activities fol-

lowing the tsunami disaster.

ATF will serve as a dedicated source of grant

financing to support priority rehabilitation and

reconstruction needs on a multi-sector basis. Resources

from the Fund will be available to central governments

and other suitable entities including non-governmental

organizations.

ATF’s resources may consist of allocations from the

net income of Ordinary Capital Resources (OCR) and

contributions from bilateral, multilateral and individual

sources.



The financial statements of the ATF are presented on


ATF reports donors’ contributions of cash and other

assets as unrestricted assets as these are made available

to ATF without conditions other than for the purpose of

pursuing its objectives.




economic operating environment of ATF.
















Investments

All investment securities held by ATF are reported at








Contributions





Technical Assistance, Grants and Undisbursed Commitments

Technical Assistance and grants are recognized in the

financial statements when the project is approved and

becomes effective. Upon completion of the TA project

or cancellation of a grant, any undisbursed amount is

written back as a reduction in technical assistance or

grants for the year and the corresponding undisbursed

commitment is eliminated accordingly.



institution, for the purpose of making payments for

eligible expenses. The advances shall be subject to

liquidation and charged against undisbursed commitment,

any unutilized portion shall be refunded to the fund.




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those estimates.


For the purposes of the Statement of Cash Flows, ATF











Investment securities and negotiable certificate of

deposits held as of 31 December 2008 are classified as







(5.27% – 2007).





pertaining to ATF are settled on a regular basis between

OCR and ATF. As of 31 December 2008, $669,000

($343,000 – 2007) was payable to OCR which is included

in accounts payable and other liabilities.



States dollars and represent effective technical assist-

ance and grants not yet disbursed. The fair value of

undisbursed commitments approximates the amounts

outstanding, because ADB expects that disbursements

will substantially be made for all the projects/programs

covered by the commitments.

In 2008, there were no undisbursed commitments

on closed TA projects that were written back as a

reduction of technical assistance ($115,000 – 2007).


In April and May 2005, ADB contributed $600,000,000

from OCR surplus to ATF. Contributions were also

received from Australia and Luxembourg amounting to

$3,796,000 and $1,000,000, respectively. In November

2005, following the establishment of Pakistan Earthquake

Fund (PEF) in response to the special circumstances

surrounding the 8 October 2005 earthquake in Pakistan,

unutilized ATF fund of $40,000,000 was transferred

back to OCR, which was subsequently transferred to

PEF. Another $10,000,000 was returned to OCR in June

2006 and was committed as ADBs contribution to the

Java Reconstruction Fund in November 2008, to support

post-disaster management, rehabilitation, immediate

construction, and urgent vital development activities in

Yogyakarta and Central Java in Indonesia.

No contributions were received in 2008 and 2007.


which have not been committed by ADB as at 31

December 2008 and 2007.










ATF-4




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ATF-4














Investments

Readily marketable investments are fair valued using

active market quotes in Level 1 category. Level 2 cat-

egory includes investments which are fair valued with

significant other market observable inputs.


ATF as of 31 December 2008 were reported based on

the following:


investments and undisbursed commitments. In all

other cases, the carrying amounts of the ATF's assets,


Assets Investments $251,288,000 $88,455,000 $162,833,000 $ –

liabilities, and uncommitted balances are considered

to approximate fair values for all significant financial

instruments.

CONTINUED

Asian Development Bank130PA

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PAKISTAN EARTHQUAKE FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

131Annual Report 2008PA

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position of the Asian Development Bank (“ADB” or “the Bank”)—Pakistan Earthquake Fund at 31

December 2008 and 2007, and the results of its activities and changes in net assets and its cash flows

for the years then ended, in conformity with accounting principles generally accepted in the United

States of America. Also in our opinion, management’s assertion that ADB maintained effective inter-

nal control over financial reporting as of 31 December 2008 is fairly stated, in all material respects,

based on criteria established in Internal Control - Integrated Framework issued by the Committee of

Sponsoring Organizations of the Treadway Commission (COSO). The management of ADB is respon-

sible for these financial statements, for maintaining effective internal control over financial reporting

and for its assertion of the effectiveness of internal control over financial reporting, included in the

accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibil-

ity is to express opinions on these financial statements and on ADB’s internal control over financial




















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Singapore

5 March 2009


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PEF-1

ASIAN DEVELOPMENT BANK—PAKISTAN EARTHQUAKE FUND


2008 2007 ASSETS

DUE FROM BANKS (Note B) $ 823 $ 1,601

INVESTMENTS (Notes B, C, and G) Government or government-guaranteed obligations $ 8,066 $ – Time deposits 53,237 61,303 60,690 60,690


DUE FROM CONTRIBUTORS (Notes B and F) 2,973 6,395

ADVANCES FOR GRANTS (Note B) 3,187 1,007

TOTAL $68,397 $69,814




UNCOMMITTED BALANCES (PEF-2) (Notes B and F), represented by: Unrestricted net assets 2,203 (3,453)

TOTAL $68,397 $ 69,814

The accompanying notes are an integral part of these financial statements (PEF-4).


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PEF-2


STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Years Ended 31 December 2008 and 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007


CONTRIBUTIONS (Notes B and F) $ 10,225 $ 19,123 REVENUE From investments (Notes B and C) $ 3,078 $ 2,387 From other sources 171 3,249 201 2,588

Total 13,474 21,711

EXPENSES Grants (Note B) – 30,000 Technical assistance (Notes B and E) – 2,000 Administrative expenses (Note D) 171 171 70 32,070

CONTRIBUTIONS AND REVENUE IN EXCESS OF (LESS THAN) EXPENSES 13,303 (10,359)

NET EXCHANGE (LOSSES) GAINS (Note B) (7,647) 860

INCREASE (DECREASE) IN NET ASSETS 5,656 (9,499)

NET ASSETS AT BEGINNING OF YEAR (3,453) 6,046

NET ASSETS AT END OF YEAR $ 2,203 $ (3,453)



KISTAN

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PEF-3



2008 2007

CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ 13,094 $ 25,100 Interest on investments received 2,940 2,331 Cash received from other sources 171 201 Grants and technical assistance disbursed (9,256) (1,980) Administrative and financial expenses paid (168) (40) Net Cash Provided by Operating Activities 6,781 25,612 CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 1,134,641 767,960 Acquisition of investments (1,141,160) (793,545) Net Cash Used in Investing Activities (6,519) (25,585) Effect of Exchange Rate Changes on Due from Banks (1,040) (44) Net Decrease in Due from Banks (778) (17) Due from Banks at Beginning of Year 1,601 1,618 Due from Banks at End of Year $ 823 $ 1,601

RECONCILIATION OF INCREASE (DECREASE) IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES:

Increase (decrease) in net assets (PEF-2) $ 5,656 $ (9,499) Adjustments to reconcile increase (decrease) in net assets to net cash provided by operating activities: Amortization of discounts/premiums on investments (97) – Change in accrued revenue 10 (56) Change in due from contributors 2,255 5,257 Change in advances for grants (2,180) (717) Change in miscellaneous liabilities 4 30 Change in undisbursed commitments (7,077) 30,737 Translation adjustments 8,261 (140) Change in unrealized investment holding gains (51) – Net Cash Provided by Operating Activities $ 6,781 $ 25,612





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The Pakistan Earthquake Fund (PEF) was established

on 14 November 2005 in response to the special circum-

stances confronted by Pakistan resulting from the effects

of an earthquake on 8 October 2005. The objective of the

PEF is to deliver emergency grant financing promptly and

effectively to Pakistan in the form of technical assistance

(TA) and investment projects to support reconstruction,

rehabilitation, and associated development activities.

PEF resources will be available to the Government

of Pakistan and other suitable entities acceptable to the

Government of Pakistan and ADB, including, where

appropriate, non-government organizations.

PEF’s resources may consist of allocations from the

net income of Ordinary Capital Resources (OCR) and

contributions from bilateral, multilateral, and individual

sources.



The financial statements of the PEF are presented on


PEF reports donors’ contributions of cash and other


to PEF without conditions other than for the purpose of





economic operating environment of PEF.
















Investments

All investment securities held by PEF are reported at








Contributions






Technical assistance and grants are recognized in the

financial statements when the project is approved and

becomes effective. Upon completion of a TA project or

cancellation of a grant, any undisbursed amount is writ-

ten back as a reduction in technical assistance or grants

for the year and the corresponding undisbursed commit-

ment is eliminated accordingly.








The preparation of financial statements in conform-

ity with generally accepted accounting principles requires


tions that affect the reported amounts of assets and liabili-

ties and uncommitted balances as at the end of the year and

PEF-4




KISTAN

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CONTINUED

the reported amounts of revenue and expenses during the

year. The actual results could differ from those estimates.


For the purposes of the Statement of Cash Flows, PEF












of deposits as of 31 December 2008 are considered




The currency compositions of the investment



Currency 2008 2007

Pakistan rupee $25,087,000 $22,689,000United States dollar 36,216,000 38,001,000 Total $61,303,000 $60,690,000




(5.81% – 2007).





pertaining to PEF are settled on a regular basis between

OCR and PEF. As of 31 December 2008, $4,000 was

payable to OCR ($5,000 – 2007) which is included in

miscellaneous liabilities.



States dollars and represent effective grants not yet

disbursed. The fair value of undisbursed commitments

approximates the amounts outstanding, because ADB




In November 2005, ADB transferred $80,000,000 from

OCR Surplus to PEF. Contributions were also received

from Australia and Finland amounting to $15,036,000

and $12,261,000, respectively.

In 2006 and 2007, instruments of contributions

were received from the Government of Norway and

the Kingdom of Belgium which undertook to make

contributions to the PEF a maximum amount of

$20,000,000 and €9,924,000, respectively. This is by

way of a debt-for development swap arrangement with

Pakistan, where Pakistan shall match the value of debt

and debt service cancellations with equivalent amounts

in Pakistan rupees, which shall be transferred to the Fund

as Norway’s and Belgium’s contributions. In 2008, PEF

received the remaining contributions due from Norway

and Belgium amounting to $5,000,000 and €3,308,000

($5,225,000 equivalent), respectively.

In 2006, the Government of Australia committed

A$20,000,000 ($15,036,000 equivalent). Of this amount,

A$4,300,000 ($2,973,000 equivalent) has not been

received as of 31 December 2008 and was recorded as

“Due from Contributors.”



December 2008, and committed amount which exceeded

cumulative resources as of 31 December 2007. This

shortfall was covered by additional contributions from

Norway and Belgium in 2008.










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PEF-4

















Investments






PEF as of 31 December 2008 were reported based on

the following:


Assets Investments $61,303,000 $ – $61,303,000 $ –



cases, the carrying amount of PEF’s assets, liabilities and



139Annual Report 2008REG

ION

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REGIONAL COOPERATION AND INTEGRATION FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

Asian Development Bank140RE

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position of the Asian Development Bank (“ADB” or “the Bank”)—Regional Cooperation and Integra-

tion Fund at 31 December 2008 and 2007, and the results of its activities and changes in net assets

and its cash flows for the year ended 31 December 2008 and for the period from 26 February 2007

(establishment of the Fund) to 31 December 2007, in conformity with accounting principles gener-

ally accepted in the United States of America. Also in our opinion, management’s assertion that ADB

maintained effective internal control over financial reporting as of 31 December 2008 is fairly stated,

in all material respects, based on criteria established in Internal Control - Integrated Framework issued

by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The manage-

ment of ADB is responsible for these financial statements, for maintaining effective internal control

over financial reporting and for its assertion of the effectiveness of internal control over financial

reporting, included in the accompanying Management’s Report on Internal Control over Financial

Reporting. Our responsibility is to express opinions on these financial statements and on ADB’s

internal control over financial reporting based on our integrated audit in 2008 and financial state-

ment audit in 2007. We conducted our audits of the financial statements in accordance with auditing

standards generally accepted in the United States of America and our audit of internal control over

financial reporting in accordance with attestation standards established by the American Institute of

Certified Public Accountants. Those standards require that we plan and perform the audits to obtain

reasonable assurance about whether the financial statements are free of material misstatement and

whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the financial statements included examining, on a test basis, evidence supporting the

amounts and disclosures in the financial statements, assessing the accounting principles used and

significant estimates made by management, and evaluating the overall financial statement presenta-

tion. Our audit of internal control over financial reporting included obtaining an understanding of

internal control over financial reporting, assessing the risk that a material weakness exists, and test-

ing and evaluating the design and operating effectiveness of internal control based on the assessed

risk. Our audits also included performing such other procedures as we considered necessary in the

circumstances. We believe that our audits provide a reasonable basis for our opinions.



ION

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Singapore

5 March 2009


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RCIF-1

ASIAN DEVELOPMENT BANK—REGIONAL COOPERATION AND INTEGRATION FUND


2008 2007

ASSETS

DUE FROM BANKS (Note B) $ 1,446 $ 1,240

INVESTMENTS (Notes B, C, and G) Government and government-guaranteed obligations $ 6,104 $ – Time deposits 8,199 39,925 Corporate bonds 24,973 39,276 – 39,925


ADVANCES FOR GRANTS (Note B) 335 –

TOTAL $41,211 $41,226




UNCOMMITTED BALANCES (RCIF-2) (Notes B and F), represented by: Unrestricted net assets 24,588 33,817

TOTAL $41,211 $41,226

The accompanying notes are an integral part of these financial statements (RCIF-4).


ION

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RCIF-2


STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Year Ended 31 December 2008 and For the Period 26 February to 31 December 2007Expressed in Thousands of United States Dollars (Note B)

2008 2007


CONTRIBUTIONS (Notes B and F) $ – $ 40,000

REVENUE From investments (Notes B and C) $ 1,244 $ 1,186 From other sources 34 1,278 40 1,226

Total 1,278 41,226

EXPENSES Technical assistance (Notes B and E) 10,458 7,400 Administrative expenses (Note D) 41 10,499 9 7,409

CONTRIBUTIONS AND REVENUE (LESS THAN) IN EXCESS OF EXPENSES (9,221) 33,817

NET EXCHANGE LOSSES (Note B) (8) –

(DECREASE) INCREASE IN NET ASSETS (9,229) 33,817

NET ASSETS AT BEGINNING OF YEAR 33,817 –

NET ASSETS AT END OF YEAR $ 24,588 $ 33,817



GIO

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RCIF-3


STATEMENT OF CASH FLOWS For the Year Ended 31 December 2008 and For the Period 26 February to 31 December 2007 Expressed in Thousands of United States Dollars (Note B)

2008 2007

CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ – $ 40,000 Interest on investments received 962 1,125 Cash received from other sources 34 40 Technical assistance disbursed (1,600) – Administrative and financial expenses paid (28) – Net Cash (Used in) Provided by Operating Activities (632) 41,165 CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 730,875 579,875 Acquisition of investments (730,037) (619,800) Net Cash Provided by (Used in) Investing Activities 838 (39,925) Net Increase in Due from Banks 206 1,240 Due from Banks at Beginning of Year 1,240 – Due from Banks at End of Year $ 1,446 $ 1,240

RECONCILIATION OF (DECREASE) INCREASE IN NET ASSETS TO NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES: (Decrease) Increase in net assets (RCIF-2) $ (9,229) $ 33,817 Adjustments to reconcile (decrease) increase in net assets to net cash (used in) provided by operating activities: Amortization of discounts/premiums on investments (132) – Change in accrued revenue (93) (61) Change in accrued expenses 6 9 Change in interfund payables 37 – Change in advances for grants (343) – Change in undisbursed commitments 9,171 7,400 Change in unrealized investment holding gains (57) – Translation adjustments 8 – Net Cash (Used in) Provided by Operating Activities $ (632) $ 41,165





RCIF-4

REGIO

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INTEG

RATION

FUN

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The Regional Cooperation and Integration Fund (RCIF),

together with Regional Cooperation and Integration

(RCI)Trust Funds, was established on 26 February

2007 under the “umbrella” of Regional Cooperation and

Integration Financing Partnership Facility (RCIFPF),

in response to the increasing demand for regional coop-

eration and integration activities among ADB’s member

countries in Asia and the Pacific. Its main objective is to

enhance regional cooperation and integration in Asia and

the Pacific by facilitating the pooling and provision of

additional financial and knowledge resources to support

RCI activities.

Financial assistance will be provided in the form

of untied grants for technical assistance (TA), including

advisory, project preparatory, and regional TA.

RCIF’s resources may consist of contributions from

ADB and other bilateral, multilateral, and individual

sources, including companies and foundations.

NOTE B—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


The financial statements of the RCIF are presented on


RCIF reports donors’ contributions of cash and

other assets as unrestricted assets as these are made

available to RCIF without conditions other than for the

purpose of pursuing its objectives.




economic operating environment of RCIF.
















Investments

All investment securities held by RCIF are reported at








Contributions

The contributions from donors and allocations from the

net income of Ordinary Capital Resources are included

in the financial statements, from the date of effectivity of

the contributions agreement, and the Board of Governors’

approval, respectively.


Technical assistance is recognized in the financial

statements when the project is approved and becomes

effective. Upon completion of the project or cancellation

of a technical assistance, any undisbursed amount is writ-

ten back as a reduction in technical assistance for the

year and the corresponding undisbursed commitment is

eliminated accordingly.













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UN

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those estimates.


For the purposes of the Statement of Cash Flows, RCIF

















investments held during the period ended 31 December

2008, based on the portfolio held at the beginning and

end of each month, was 3.12% (5.31% - 2007).




each other. Regional technical assistance projects and

programs may be combined activities between special

and trust funds. The administrative and operational ex-

penses pertaining to RCIF are settled on a regular basis

between RCIF and the other funds. As of 31 December

2008, $15,000 (nil-2007) and $22,000 (nil-2007) was pay-

able to OCR and TASF, respectively, which are included

in miscellaneous liabilities.

NOTE E— TECHNICAL ASSISTANCE AND UNDISBURSED COMMITMENTS

During the year, there were thirteen (four technical as-

sistance (TA) and one supplementary approval – 2007)

TA grants totaling $10,458,000 ($7,400,000 – 2007)

which became effective.

Undisbursed commitments are denominated

in United States dollars and represent technical

assistance not yet disbursed. The fair value of

undisbursed commitments approximates the amounts

outstanding, because ADB expects that disbursements

will substantially be made for all the projects/programs

covered by the commitments.



location of $40,000,000 to the RCIF from the 2006 OCR

net income.



December 2008.


























RCIF-4

REGIO

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N A

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INTEG

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FUN

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Assets Investments $39,276,000 $ – $39,276,000 $ –

Investments







cases, the carrying amount of RCIF’s assets, liabilities

The fair values of the following financial assets of

RCIF as of 31 December 2008 were reported based on

the following:

and uncommitted balances are considered to approximate


CONTINUED

Asian Development Bank148C

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CLIMATE CHANGE FUND


























Haruhiko Kuroda

President

Bindu N. Lohani


Hong-Sang Jung

Controller

5 March 2009

149Annual Report 2008C

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In our opinion, the accompanying statements of financial position and the related statements of activities

and changes in net assets and cash flows present fairly, in all material respects, the financial position

of the Asian Development Bank (“ADB” or “the Bank”)—Climate Change Fund at 31 December 2008,

and the results of its activities and changes in net assets and its cash flows for the period from 7 April

2008 (establishment of the Fund) to 31 December 2008, in conformity with accounting principles

generally accepted in the United States of America. Also in our opinion, management’s assertion that

ADB maintained, effective internal control over financial reporting as of 31 December 2008 is fairly

stated, in all material respects, based on criteria established in Internal Control – Integrated Frame-

work issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

The management of ADB is responsible for these financial statements, for maintaining effective

internal control over financial reporting and for its assertion of the effectiveness of internal control

over financial reporting, included in the accompanying Management's Report on Internal Control over

Financial Reporting. Our responsibility is to express opinions on these financial statements and on

ADB’s internal control over financial reporting based on our integrated audit in 2008. We conducted



















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Singapore

5 March 2009


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CCF-1

ASIAN DEVELOPMENT BANK—CLIMATE CHANGE FUND

STATEMENT OF FINANCIAL POSITION 31 December 2008Expressed in Thousands of United States Dollars (Note B)

ASSETS

DUE FROM BANKS (Note B) $ 1,564

INVESTMENTS (Notes B, C, and G) Time deposits $ 10,921 Corporate obligations 27,973 38,894

ACCRUED REVENUE 50

TOTAL $ 40,508


MISCELLANEOUS LIABILITIES (Note D) $ 81

UNDISBURSED COMMITMENTS (Notes B, E, and G) 3,000

UNCOMMITTED BALANCES (CCF-2) (Notes B and F), represented by: Unrestricted net assets 37,427

TOTAL $ 40,508

The accompanying notes are an integral part of these financial statements (CCF-4).


LIM

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CCF-2


STATEMENT OF ACTIVITIES AND CHANGES IN NET ASSETS For the Period 7 April to 31 December 2008 Expressed in Thousands of United States Dollars (Note B)


CONTRIBUTIONS (Notes B and F) $ 40,000

REVENUE From investments (Notes B and C) 545 From other sources 9

Total 40,554 EXPENSES Administrative expenses (Note D) 124 Technical assistance (Note B) 3,000

Total 3,124 CONTRIBUTIONS AND REVENUE IN EXCESS OF EXPENSES 37,430 NET EXCHANGE LOSSES (Note B) (3)

NET ASSETS AT END OF PERIOD $ 37,427

The accompanying notes are an integral part of these financial statements (CCF-4).


LIMA

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CCF-3


STATEMENT OF CASH FLOWS For the Period 7 April to 31 December 2008 Expressed in Thousands of United States Dollars (Note B)

CASH FLOWS FROM OPERATING ACTIVITIES Contributions received $ 40,000 Interest on investments received 315 Administrative expenses paid (46) Cash received from other sources 9 Net Cash Provided by Operating Activities 40,278 CASH FLOWS FROM INVESTING ACTIVITIES Maturities of investments 336,872 Acquisition of investments (375,586) Net Cash Used in Investing Activities (38,714) Due from Banks at End of Period $ 1,564

RECONCILIATION OF INCREASE IN NET ASSETS TO NET CASH PROVIDED BY OPERATING ACTIVITIES:

Increase in net assets (CCF-2) $ 37,427 Adjustments to reconcile increase in net assets to net cash provided by operating activities: Amortization of discounts on investments (180) Change in accrued revenue (50) Change in miscellaneous assets (0) Change in miscellaneous liabilities 78 Change in undisbursed commitments 3,000 Translation adjustments 3 Net Cash Provided by Operating Activities $ 40,278

0 - Less than $500.The accompanying notes are an integral part of these financial statements (CCF-4).


NOTES TO FINANCIAL STATEMENTSFor the Period 7 April to 31 December 2008


LIM

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The Climate Change Fund (CCF) was established on 7

April 2008 to facilitate greater investments in developing

member countries (DMCs) to address the causes and

consequences of climate change alongside ADB’s own

assistance in various related sectors. The CCF will be a

key mechanism to pool resources within ADB to address

climate change through (i) technical assistance (TA),

(ii) investment components for both private and public

sector projects, and (iii) any other form of cooperation

that partners and ADB may agree upon for a defined

program of activities.

Financial assistance will be provided in the form

of untied grants for components of investment projects,

for advisory, project preparatory, and regional technical

assistance (TA); as well as for any other activities that

may be agreed between external contributors and ADB.

CCF’s resources may consist of contributions from

ADB and other bilateral, multilateral, and individual

sources, including companies and foundations.



The financial statements of the CCF are presented on


CCF reports donors’ contributions of cash and other


to CCF without conditions other than for the purpose of





economic operating environment of CCF.
















Investments

All investment securities held by CCF are reported at








Contributions


net income of Ordinary Capital Resources are included

in the financial statements, from the date of effectivity of

the contributions agreement, and the Board of Governors'

approval, respectively.

Technical Assistance and Undisbursed Commitments

Technical assistance is recognized in the financial

statements when the project is approved and becomes

effective. Upon completion of the project or cancellation

of a technical assistance, any undisbursed amount is writ-

ten back as a reduction in technical assistance for the

year and the corresponding undisbursed commitment is

eliminated accordingly.









those estimates.

CCF-4




LIMATE C

HA

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E FUN

D


For the purposes of the Statement of Cash Flows, CCF
















Interest on investment securities and time

deposits are recognized as realized and reported net of



investments held during the period ended 31 December

2008, based on the portfolio held at the beginning and

end of each month, was 2.59%.


The OCR and special fund resources are at all times used,

committed, and invested entirely separate from each

other. The administrative and operational expenses per-

taining to CCF are settled on a regular basis between OCR

and CCF. As of 31 December 2008, $6,000 was payable to

OCR which is included in miscellaneous liabilities.



States dollars and represent technical assistance not yet

disbursed. The fair value of undisbursed commitments

approximates the amounts outstanding, because ADB





location of $40,000,000 to the CCF from the 2007 OCR

net income.



December 2008.























Investments





CONTINUED




LIM

ATE

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The fair value of the following financial assets of CCF as of 31 December 2008 were reported based on the

following:

Fair Value Measurements Quoted Prices in Significant Significant Active Markets for Other Observable Unobservable Identical Assets Inputs Inputs 31 December 2008 (Level 1) (Level 2) (Level 3) Assets Investments $38,894,000 $ – $38,894,000 $ –

CCF-4



cases, the carrying amount of CCF’s assets, liabilities and



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EXES157Annual Report 2008

STATISTICAL ANNEXES

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Statistical Annex 1 SOVEREIGN AND NONSOVEREIGN LOAN APPROVALS BY COUNTRY, 2008 ($ million)

Total Date OCR ADF Total Project Costa Approved

SOVEREIGN Armenia Rural Road Sector (Supplementary) – 17.32 17.32 23.44 7 Nov

Subtotal – 17.32 17.32 23.44

Azerbaijan

Road Network Development Program – Tranche 2 55.40 – 55.40 73.90 22 Aug Power Transmission Enhancement 160.00 – 160.00 240.00 10 Sep

Subtotal 215.40 – 215.40 313.90

Bangladesh Emergency Disaster Damage Rehabilitation (Sector) – 120.00 120.00 220.00 31 Jan Skills Development – 50.00 50.00 66.70 6 Jun Emergency Assistance for Food Security – 170.00 170.00 1,293.00 22 Jul Public-Private Infrastructure Development Facility 82.00 83.00 165.00 925.00 2 Oct Second Urban Governance and Infrastructure Improvement (Sector) – 87.00 87.00 167.50 28 Oct

Subtotal 82.00 510.00 592.00 2,672.20

Bhutan Green Power Development 51.00 29.00 80.00 234.45 29 Oct

Subtotal 51.00 29.00 80.00 234.45

Cambodia Road Asset Management – 6.00 6.00 58.35 21 Jan Emergency Food Assistance – 17.50 17.50 40.08 2 Oct Financial Sector Program II Cluster (Subprogram 2) – 10.30 10.30 10.30 5 Dec Promoting Economic Diversification Program (Subprogram 1) – 20.00 20.00 22.00 5 Dec

Subtotal – 53.80 53.80 130.73

China, People’s Republic of Gansu Baiyin Urban Development 80.00 – 80.00 161.53 23 Jan Gansu Heihe Rural Hydropower Development Investment Program – Tranche 2: Dagushan Hydropower Project 28.00 – 28.00 61.92 28 Jan Xinjiang Municipal Infrastructure and Environmental Improvement 105.00 – 105.00 190.90 23 Apr Guangdong Energy Efficiency and Environment Improvement Investment Program – Tranche 1 35.00 – 35.00 50.00 9 Jun Integrated Ecosystem and Water Resources Management in the Baiyangdian Basin 100.00 – 100.00 273.38 24 Jun Ningxia Integrated Ecosystem and Agricultural Development 100.00 – 100.00 221.02 29 Aug Central Yunnan Roads Development 200.00 – 200.00 745.00 25 Sep Lanzhou–Chongqing Railway Development 300.00 – 300.00 8,608.90 18 Nov Dryland Sustainable Agriculture 83.00 – 83.00 204.69 25 Nov Chongqing–Lichuan Railway Development 150.00 – 150.00 3,071.10 8 Dec Songhua River Basin Water Pollution Control and Management 200.00 – 200.00 396.33 11 Dec Guangxi Wuzhou Urban Development 100.00 – 100.00 263.40 15 Dec Qingdao Water Resources and Wetland Protection 45.00 – 45.00 105.80 17 Dec

Subtotal 1,526.00 – 1,526.00 14,353.96

– = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Total project cost includes financing by ADB, governments, beneficiaries, and subborrowers; cofinancing from official, export credit, and commercial sources; equity

sponsors; and local participating private companies and financial institutions.

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CONTINUED

Cook Islands Avatiu Port Development 8.63 6.88 15.51 18.19 20 Nov

Subtotal 8.63 6.88 15.51 18.19

Georgia Municipal Services Development – 40.00 40.00 63.25 12 Sep Emergency Assistance for Post-Conflict Recovery – 70.00 70.00 70.00 12 Nov

Subtotal – 110.00 110.00 133.25

India Uttarakhand Urban Sector Development Investment Program – Tranche 1 60.00 – 60.00 85.70 1 Feb Rural Roads Sector II Investment Program – Tranche 2 77.65 – 77.65 100.46 17 Mar National Power Grid Development Investment Program – Tranche 1 400.00 – 400.00 429.42 28 Mar Assam Governance and Public Resource Management Sector Development Program (Subprogram II) 100.00 – 100.00 100.00 17 Sep Bihar State Highways 420.00 – 420.00 468.00 18 Sep Orissa Integrated Irrigated Agriculture and Water Management Investment Program – Tranche 1 47.20 – 47.20 67.50 26 Sep Rural Roads Sector II Investment Program – Tranche 3 130.00 – 130.00 168.80 26 Sep Khadi Reform and Development Program 150.00 – 150.00 150.00 2 Oct Urban Water Supply and Environmental Improvement in Madhya Pradesh (Supplementary) 71.00 – 71.00 108.00 13 Oct Uttarakhand State-Road Investment Program – Tranche 2 140.00 – 140.00 200.00 22 Oct Himachal Pradesh Clean Energy Development Investment Program – Tranche 1 150.00 – 150.00 224.80 27 Oct Uttarakhand Power Sector Investment Program – Tranche 2 62.40 – 62.40 89.14 23 Dec

Subtotal 1,808.25 – 1,808.25 2,191.82 Indonesia Vocational Education Strengthening – 80.00 80.00 115.00 31 Mar Rural Infrastructure Support to PNPM Mandiri – 50.00 50.00 62.50 29 Sep Infrastructure Reform Sector Development Program (Subprogram 2) 280.00 – 280.00 280.00 27 Nov Second Local Government Finance and Governance Reform Program Cluster (Subprogram 1) 350.00 – 350.00 350.00 4 Dec Fourth Development Policy Support Program 200.00 – 200.00 200.00 16 Dec Integrated Citarum Water Resources Management Investment Program – Tranche 1 20.00 30.00 50.00 88.63 22 Dec

Subtotal 850.00 160.00 1,010.00 1,096.13

Kazakhstan CAREC Transport Corridor I (Zhambyl Oblast Section) [Western Europe–Western People’s Republic of China International Transit Corridor] Investment Program – Tranche 1 340.00 – 340.00 400.00 30 Dec

Subtotal 340.00 – 340.00 400.00

Maldives Private Sector Development – 7.50 7.50 7.80 20 Jun

Subtotal – 7.50 7.50 7.80

– = nil, ADF = Asian Development Fund, CAREC = Central Asia Regional Economic Cooperation, OCR = ordinary capital resources, PNPM = Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment).a Total project cost includes financing by ADB, governments, beneficiaries, and subborrowers; cofinancing from official, export credit, and commercial sources; equity


STATISTIC

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Pakistan Barani Integrated Water Resources Sector 55.00 20.00 75.00 104.50 3 Mar Preparing the Lahore Rapid Mass Transit System – 6.00 6.00 7.50 4 Jun Power Distribution Enhancement Investment Program – Tranche 1 242.00 10.00 252.00 327.00 12 Sep Accelerating Economic Transformation Program (Subprogram 1) 300.00 200.00 500.00 500.00 30 Sep Second Balochistan Resource Management Program (Subprogram 1) 45.00 55.00 100.00 100.00 11 Dec Sindh Growth and Rural Revitalization Program (Subprogram 1) – 100.00 100.00 100.00 11 Dec Punjab Millennium Development Goals Program (Subprogram 1) – 100.00 100.00 100.00 11 Dec Sindh Cities Improvement Investment Program – Tranche 1 – 38.00 38.00 50.00 19 Dec

Subtotal 642.00 529.00 1,171.00 1,289.00

Papua New Guinea Highlands Region Road Improvement Investment Program – Tranche 1b – 100.00 100.00 140.00 22 Dec

Subtotal – 100.00 100.00 140.00

Philippines Development Policy Support Program (Subprogram 2) 250.00 – 250.00 250.00 30 Sep Agrarian Reform Communities Project II 70.00 – 70.00 208.40 27 Oct Governance in Justice Sector Reform Program (Subprogram 1) 300.00 – 300.00 300.00 16 Dec

Subtotal 620.00 – 620.00 758.40

Samoa Sanitation and Drainage (Supplementary) – 2.78 2.78 7.81 12 Sep

Subtotal – 2.78 2.78 7.81

Sri Lanka Southern Transport Development (Supplementary) 90.00 – 90.00 179.10 6 Mar Dry Zone Urban Water and Sanitation – 59.78 59.78 113.33 28 Nov

Subtotal 90.00 59.78 149.78 292.43

Uzbekistan Surkhandarya Water Supply and Sanitation – 30.00 30.00 40.00 3 Nov Water Resources Management Sector 85.00 15.00 100.00 148.00 17 Dec

Subtotal 85.00 45.00 130.00 188.00

Viet Nam Song Bung 4 Hydropower 196.00 – 196.00 267.30 26 Jun Ho Chi Minh City–Long Thanh–Dau Giay Expressway Construction 410.20 – 410.20 932.40 30 Sep Greater Mekong Subregion Sustainable Tourism Development – 10.00 10.00 11.11 15 Oct Greater Mekong Subregion: Ha Noi–Lang Son, Greater Mekong Subregion: Ha Long–Mong Cai, and Ben Luc-Long Thanh Expressways Technical Assistance – 26.00 26.00 30.80 23 Oct Health Care in the South Central Coast Region – 72.00 72.00 80.00 7 Nov Emergency Rehabilitation of Calamity Damage (Supplementary) – 25.50 25.50 30.00 8 Dec Support for the Implementation of the Poverty Reduction Program V (Subprogram 1) – 25.00 25.00 32.14 8 Dec

Subtotal 606.20 158.50 764.70 1,383.75

Total Sovereign 6,924.48 1,789.56 8,714.04 25,635.26 – = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Total project cost includes financing by ADB, governments, beneficiaries, and subborrowers; cofinancing from official, export credit, and commercial sources; equity

sponsors; and local participating private companies and financial institutions.b Consists of two ADF loans.

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CONTINUED

NONSOVEREIGN Afghanistan Roshan Expansion (Phase III) 60.00 – 60.00 175.00 29 Jul

Subtotal 60.00 – 60.00 175.00

China, People’s Republic of Municipal District Energy Infrastructure Development 200.00 – 200.00 1,285.14 2 Jun Inner Mongolia Wind Power 24.08 – 24.08 73.42 4 Sep

Subtotal 224.08 – 224.08 1,358.56

India Gujarat Paguthan Wind Energy Financing Facility (Samana Phase I) 45.00 – 45.00 67.64 17 Apr Mundra Ultra Mega Power 450.00 – 450.00 4,226.75 17 Apr CLP Wind Farms Private Limited (Samana Phase II and the Saundatti Project) 60.00 – 60.00 169.13 17 Apr GTL Infrastructure Limited Phase II Telecommunication Infrastructure 150.00 – 150.00 1,184.54 23 May National Highway 1 Panipat–Jalandhar Toll Road 100.00 – 100.00 1,067.00 23 Oct Columbia Asia Hospitals Development 38.64 – 38.64 154.55 10 Nov Rural Electrification Corporation of India 225.00 – 225.00 225.00 27 Nov

Subtotal 1,068.64 – 1,068.64 7,094.61

Indonesia Bank Mandiri (Persero) 75.00 – 75.00 300.00 29 Jul

Subtotal 75.00 – 75.00 300.00

Maldives Housing Development Finance Corporation 7.50 – 7.50 33.00 9 Apr

Subtotal 7.50 – 7.50 33.00

Philippines Acquisition and Rehabilitation of the Masinloc Coal-Fired Thermal Power Plant 200.00 – 200.00 1,100.00 15 Jan Privatization and Refurbishment of the Calaca Coal-Fired Thermal Power Plant 120.00 – 120.00 890.00 2 Jun

Subtotal 320.00 – 320.00 1,990.00

Viet Nam Saigon Thuong Tin Bank (Sacombank) 25.00 – 25.00 25.00 10 Dec

Subtotal 25.00 – 25.00 25.00

Total Nonsovereign 1,780.23 – 1,780.23 10,976.18

TOTAL 8,704.71 1,789.56 10,494.27 36,611.44 – = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Total project cost includes financing by ADB, governments, beneficiaries, and subborrowers; cofinancing from official, export credit, and commercial sources; equity


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Statistical Annex 2 GRANT-FINANCED PROJECT APPROVALS BY COUNTRY, 2008 ($ million)

Date ADF Other Sourcesa Total Approved

Afghanistan Agriculture Market Infrastructure 30.00 – 30.00 21 Nov Development of Mini Hydropower Plants in Badakhshan and Bamyan Provinces – 12.00 JFPR 12.00 28 Nov Energy Sector Development Investment Program – Tranche 1 164.00 – 164.00 2 Dec Road Network Development Investment Program – Tranche 1 60.00 – 60.00 2 Dec

Subtotal 254.00 12.00 266.00

Bangladesh Emergency Disaster Damage Rehabilitation (Sector)a – 10.00 Canada 10.00 28 Mar Post-Literacy and Continuing Education (Supplementary)a – 2.50 Switzerland 2.50 1 Jul Skills Developmenta – 6.00 Switzerland 6.00 17 Dec

Subtotal – 18.50 18.50

Bhutan Green Power Developmenta 25.28 – 25.28 29 Oct Green Power Developmenta – 1.00 ACEF-CEFPF 1.00 26 Dec

Subtotal 25.28 1.00 26.28

Cambodia Road Asset Managementa – 4.80 Australia 4.80 21 Jan Health Sector Support (Supplementary)a – 1.80 United Kingdom 1.80 31 Mar Emergency Food Assistancea 17.50 – 17.50 2 Oct Public Financial Management for Rural Development Program (Subprogram 1) 6.71 – 6.71 4 Dec Public Financial Management for Rural Development Project 4.10 – 4.10 4 Dec Capacity Development in Sanitary and Phytosanitary Standards Management Systemsa 2.00 – 2.00 5 Dec

Subtotal 30.31 6.60 36.91

China, People’s Republic of Capacity Building for Energy Efficiency Implementation – 0.80 CEF-CEFPF 0.80 4 Jun Ningxia Integrated Ecosystem and Agricultural Developmenta – 4.55 GEF 4.55 29 Aug Dryland Sustainable Agriculturea – 0.35 Spain 0.35 25 Nov

Subtotal – 5.70 5.70

Kyrgyz Republic Southern Agriculture Area Development (Supplementary)a – 2.50 GEF 2.50 15 May Investment Climate Improvement Program (Subprogram 1) 12.50 – 12.50 3 Nov Investment Climate Improvement Program System Support Project 2.90 – 2.90 3 Nov Community-Based Infrastructure Services Sector 30.00 – 30.00 3 Nov CAREC Transport Corridor 1 (Bishkek–Torugart Road) 20.00 – 20.00 14 Nov

Subtotal 65.40 2.50 67.90

Lao People’s Democratic Republic Alternative Livelihood for Upland Ethnic Groups in Houaphanh Province – 1.82 JFPR 1.82 13 Feb Greater Mekong Subregion Sustainable Tourism Developmenta 10.00 – 10.00 15 Oct

Subtotal 10.00 1.82 11.82

Micronesia, Federated States of Weno Water Supply Well Remediation – 0.98 JFPR 0.98 17 Jul


Mongolia Western Regional Road Corridor Development – Phase I 37.60 – 37.60 26 Feb Community-Based Local Road Upgrading and Maintenance in the Western Region of Mongolia – 2.00 JFPR 2.00 10 Jul Water Point and Extension Station Establishment for Poor Herding Families – 2.00 JFPR 2.00 30 Jul Poverty Reduction through Community-Based Natural Resource Management – 2.00 JFPR 2.00 5 Aug Energy Conservation and Emissions Reduction from Poor Households – 2.00 JFPR 2.00 23 Sep Agriculture and Rural Development 14.72 – 14.72 29 Sep

– = nil, ACEF-CEFPF = Asian Clean Energy Fund (Japan) under the Clean Energy Financing Partnership Facility, ADF = Asian Development Fund, CAREC = Central Asia Regional Economic Cooperation, CEF-CEFPF = Clean Energy Fund under the Clean Energy Financing Partnership Facility, GEF = Global Environment Facility, JFPR = Japan Fund for Poverty Reduction. a Grant component of a loan project.

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CONTINUED

Education Sector Reform 10.00 – 10.00 21 Nov Food and Nutrition Social Welfare Program 9.00 – 9.00 10 Dec Food and Nutrition Social Welfare – Capacity Development Project 3.00 – 3.00 10 Dec

Subtotal 74.32 8.00 82.32

Nepal Education Sector Program Cluster (Subprogram II) 8.00 – 8.00 24 Jan Information and Communication Technology Development 25.00 – 25.00 28 Jan Governance Support Program (Subprogram 1) 106.30 – 106.30 22 Oct Rural Reconstruction and Rehabilitation Sector Development Project (Supplementary) – 20.00 United Kingdom 20.00 11 Nov

Subtotal 139.30 20.00 159.30

Philippines Developing Microinsurance – 1.00 JFPR 1.00 15 Feb


Samoa Sanitation and Drainagea 2.22 – 2.22 12 Sep

Subtotal 2.22 – 2.22

Solomon Islands Road Improvement Sector (Supplementary) – 0.47 Australia 0.47 30 Apr Domestic Maritime Support (Sector) 14.00 5.25 EC 19.25 25 Nov

Subtotal 14.00 5.72 19.72

Sri Lanka Improvement of Rural Access Roads and Livelihood Development for the Poor – 2.00 JFPR 2.00 21 Jan Dry Zone Urban Water and Sanitationa 23.22 2.00 NET-WFPF 25.22 28 Nov

Subtotal 23.22 4.00 27.22

Tajikistan Rural Development (Supplementary)a – 3.50 GEF 3.50 15 May Community Participatory Flood Management – 3.00 JFPR 3.00 8 Sep Nurek 500 kV Switchyard Reconstruction 54.77 – 54.77 17 Nov

Subtotal 54.77 6.50 61.27

Tonga Integrated Urban Development Sector 11.30 – 11.30 27 May

Subtotal 11.30 – 11.30

Tuvalu Improved Financial Management Program 3.24 – 3.24 16 Dec

Subtotal 3.24 – 3.24

Uzbekistan Land Improvementa – 3.00 GEF 3.00 09 Jan Surkhandarya Water Supply and Sanitationa – 1.50 MDTF-WFPF 1.50 3 Nov


Viet Nam Community-Based Early Childhood Care and Development – 1.90 JFPR 1.90 19 Feb Livelihood Improvement of Vulnerable Ethnic Minority Communities Affected by the Song Bung 4 Hydropower Project in Quang Nam Provincea – 2.00 JFPR 2.00 26 Jun Demand-Driven Skills Training for Poverty Reduction in the Cuu Long (Mekong) River Delta – 1.30 JFPR 1.30 18 Jul

Subtotal – 5.20 5.20 TOTAL 707.36 104.01 811.37

– = nil, ADF = Asian Development Fund, EC = European Commission, GEF = Global Environment Facility, JFPR = Japan Fund for Poverty Reduction, MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility, NET-WFPF = The Netherlands Trust Fund for the Water Financing Partnership Facility.a Grant component of a loan project.

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Statistical Annex 3 LOAN APPROVALS BY SECTOR: 3-YEAR MOVING AVERAGES, 1968-1970–2006-2008

Law, Water Health, Economic Transport Supply, Total Agriculture Nutrition, Management, and Sanitation, Lendinga and Natural and Social Industry and Public Commu- and Waste Multi- ($ million) Resources Education Energy Finance Protection and Trade Policy nications Management sector

Average during (percent of total lending) 1968–1970 128.44 18.32 0.78 11.98 14.27 – 24.92 – 24.03 5.32 0.38 1969–1971 199.25 19.16 0.50 25.38 13.45 – 15.89 – 21.68 3.70 0.25 1970–1972 271.92 13.86 0.82 33.06 10.71 – 9.95 – 21.48 9.93 0.18

1971–1973 330.53 12.72 1.02 32.18 11.29 – 7.68 – 23.88 11.23 – 1972–1974 428.42 14.17 0.79 26.71 12.73 – 8.46 – 21.32 13.33 2.49 1973–1975 543.15 16.57 1.28 23.03 13.35 – 16.03 – 17.68 9.16 2.89

1974–1976 661.29 17.48 0.73 20.74 14.67 – 14.53 – 16.61 9.06 6.18 1975–1977 774.22 17.85 1.49 21.50 13.09 – 12.17 – 16.97 8.43 8.51 1976–1978 940.36 17.56 2.95 21.11 11.01 1.36 10.16 – 15.98 8.97 10.90

1977–1979 1,098.92 19.65 5.13 22.84 9.54 1.17 9.55 – 12.10 8.71 11.31 1978–1980 1,282.01 22.81 5.56 23.74 7.71 1.41 8.42 – 12.39 8.05 9.93 1979–1981 1,454.96 24.70 5.35 26.21 7.29 1.72 9.21 – 9.41 7.67 8.45

1980–1982 1,598.97 29.52 4.41 27.61 6.04 2.01 7.43 – 11.53 5.87 5.59 1981–1983 1,751.46 31.78 5.19 26.60 6.61 2.91 8.00 – 7.52 6.87 4.52 1982–1984 1,937.03 34.36 5.34 28.98 4.09 1.88 4.05 – 12.12 5.94 3.25

1983–1985 1,978.52 31.63 5.27 24.63 4.48 2.42 3.75 – 12.75 8.36 6.71 1984–1986 2,013.77 32.17 4.95 25.26 3.82 2.02 2.23 – 14.40 6.02 9.11 1985–1987 2,081.84 27.37 3.97 17.47 7.80 2.19 7.53 – 20.54 4.75 8.38

1986–1988 2,512.17 22.78 5.20 18.76 8.07 1.60 12.68 – 23.12 1.47 6.32 1987–1989 3,053.72 19.80 4.97 16.07 12.42 1.91 12.30 – 23.47 3.42 5.65 1988–1990 3,564.93 22.53 6.33 20.48 11.10 1.35 7.43 – 20.68 3.38 6.71

1989–1991 4,115.49 22.51 5.25 25.79 9.55 1.43 6.67 – 17.93 3.09 7.77 1990–1992 4,610.39 18.03 5.00 28.91 7.96 1.14 6.40 – 20.60 2.04 9.91 1991–1993 5,022.89 11.37 5.18 31.01 6.60 1.26 8.48 0.09 23.46 3.07 9.47

1992–1994 4,665.65 9.19 4.90 29.63 6.11 1.56 5.08 0.09 29.31 4.43 9.70 1993–1995 4,791.51 10.83 5.74 31.66 5.61 1.13 3.58 0.09 26.79 6.34 8.22 1994–1996 4,806.49 14.06 5.64 27.54 6.15 1.65 1.52 1.77 25.64 5.63 10.39

1995–1997 6,718.17 10.34 6.71 18.66 30.08 1.70 1.29 1.84 16.33 5.21 7.85 1996–1998 6,883.72 7.34 5.46 11.67 34.80 5.50 1.19 2.02 18.49 3.87 9.67 1997–1999 6,776.72 5.50 4.64 9.76 34.15 6.76 1.97 4.38 16.84 4.92 11.08

1998–2000 5,499.56 7.77 4.01 13.94 12.54 8.09 4.64 5.30 23.49 4.64 15.58 1999–2001 5,284.95 10.68 4.96 15.92 3.60 3.58 5.02 10.96 23.99 4.22 17.07 2000–2002 5,526.40 10.94 5.35 17.02 8.60 1.58 3.83 9.51 27.04 2.98 13.15

2001–2003 5,693.81 9.03 4.10 14.27 7.44 1.35 2.61 10.40 33.23 5.33 12.24 2002–2004 5,593.92 6.53 4.29 14.79 7.63 2.65 3.03 8.65 37.43 4.99 10.01 2003–2005 5,628.15 5.28 2.93 15.03 3.83 2.74 2.30 9.84 37.50 7.49 13.05

2004–2006 6,021.31 7.20 3.25 17.03 11.82 1.83 1.01 8.76 28.71 7.12 13.26 2005–2007 7,663.50 5.43 1.97 16.41 13.32 0.47 0.37 9.47 30.80 7.24 14.52 2006–2008 9,241.38 5.01 1.90 18.61 10.52 0.94 0.82 12.06 29.19 5.22 15.71

Cumulativea $ million (1968–2008) 143,528.39 17,063.03 6,023.83 28,502.50 16,690.00 3,292.22 5,715.04 7,741.44 35,115.60 7,311.66 16,073.08

– = nil. a Totals may not add because of rounding.

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Statistical Annex 4 LOAN APPROVALS BY SECTOR, 2008

$ Million

OCR ADF Total

AGRICULTURE AND NATURAL RESOURCES CAM Emergency Food Assistance – 17.50 17.50 IND Orissa Integrated Irrigated Agriculture and Water Management Investment Program – Tranche 1 47.20 – 47.20 PHI Agrarian Reform Communities Project II 70.00 – 70.00 PRC Ningxia Integrated Ecosystem and Agricultural Development 100.00 – 100.00 PRC Dryland Sustainable Agriculture 83.00 – 83.00 UZB Water Resources Management Sector 85.00 15.00 100.00 VIE Emergency Rehabilitation of Calamity Damage (Supplementary) – 25.50 25.50

Subtotal 385.20 58.00 443.20 EDUCATION BAN Skills Development – 50.00 50.00 INO Vocational Education Strengthening – 80.00 80.00

Subtotal – 130.00 130.00 ENERGY AZE Power Transmission Enhancement 160.00 – 160.00 BHU Green Power Development 51.00 29.00 80.00 IND Gujarat Paguthan Wind Energy Financing Facilitya (Samana Phase I) 45.00 – 45.00 IND Mundra Ultra Mega Powera 450.00 – 450.00 IND CLP Wind Farms Private Limiteda (Samana Phase II and the Saundatti Project) 60.00 – 60.00 IND National Power Grid Development Investment Program – Tranche 1 400.00 – 400.00 IND Himachal Pradesh Clean Energy Development Investment Program – Tranche 1 150.00 – 150.00 IND Uttarakhand Power Sector Investment Program – Tranche 1 62.40 – 62.40 PAK Power Distribution Enhancement Investment Program – Tranche 1 242.00 10.00 252.00 PHI Acquisition and Rehabilitation of the Masinloc Coal-Fired Thermal Power Planta 200.00 – 200.00 PHI Privatization and Refurbishment of the Calaca Coal-Fired Thermal Power Planta 120.00 – 120.00 PRC Municipal District Energy Infrastructure Developmenta 200.00 – 200.00 PRC Inner Mongolia Wind Powera 24.08 – 24.08 PRC Gansu Heihe Rural Hydropower Development Investment Program – Tranche 2: Dagushan Hydropower 28.00 – 28.00 PRC Guangdong Energy Efficiency and Environment Improvement Investment Program – Tranche 1 35.00 – 35.00 VIE Song Bung 4 Hydropower 196.00 – 196.00

Subtotal 2,423.48 39.00 2,462.48 FINANCE CAM Financial Sector Program II Cluster (Subprogram 2) – 10.30 10.30 INO Bank Mandiri (Persero)a 75.00 – 75.00 MLD Housing Development Finance Corporationa 7.50 – 7.50 VIE Saigon Thuong Tin Bank (Sacombank)a 25.00 – 25.00

Subtotal 107.50 10.30 117.80 HEALTH, NUTRITION, AND SOCIAL PROTECTION IND Columbia Asia Hospitals Developmenta 38.64 – 38.64 PAK Punjab Millennium Development Goals Program (Subprogram 1) – 100.00 100.00 VIE Health Care in the South Central Coast Region – 72.00 72.00

Subtotal 38.64 172.00 210.64

– = nil, ADF = Asian Development Fund, AZE = Azerbaijan, BAN = Bangladesh, BHU = Bhutan, CAM = Cambodia, IND = India, INO = Indonesia, MLD = Maldives, OCR = ordinary capital resources, PAK = Pakistan, PHI = Philippines, PRC = People’s Republic of China, UZB = Uzbekistan, VIE = Viet Nam.a Nonsovereign Loan.

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$ Million OCR ADF Total

CONTINUED

INDUSTRY AND TRADE IND Khadi Reform and Development Program 150.00 – 150.00 MLD Private Sector Development – 7.50 7.50 VIE Greater Mekong Subregion Sustainable Tourism Development – 10.00 10.00

Subtotal 150.00 17.50 167.50 LAW, ECONOMIC MANAGEMENT, AND PUBLIC POLICY CAM Promoting Economic Diversification Program (Subprogram 1) – 20.00 20.00 IND Assam Governance and Public Resource Management Sector Development Program (Subprogram II) 100.00 – 100.00 INO Second Local Government Finance and Governance Reform Program Cluster (Subprogram 1) 350.00 – 350.00 INO Fourth Development Policy Support Program 200.00 – 200.00 PAK Accelerating Economic Transformation Program (Subprogram 1) 300.00 200.00 500.00 PAK Second Balochistan Resource Management Program (Subprogram 1) 45.00 55.00 100.00 PAK Sindh Growth and Rural Revitalization Program (Subprogram 1) – 100.00 100.00 PHI Development Policy Support Program (Subprogram 2) 250.00 – 250.00 PHI Governance in Justice Sector Reform Program (Subprogram 1) 300.00 – 300.00 VIE Support for the Implementation of the Poverty Reduction Program V (Subprogam 1) – 25.00 25.00

Subtotal 1,545.00 400.00 1,945.00 TRANSPORT AND COMMUNICATIONS ARM Rural Road Sector (Supplementary) – 17.32 17.32 AZE Road Network Development Program – Tranche 2 55.40 – 55.40 CAM Road Asset Management – 6.00 6.00 COO Avatiu Port Development 8.63 6.88 15.51 IND GTL Infrastructure Limited Phase II Telecommunication Infrastructurea 150.00 – 150.00 IND National Highway 1 Panipat-Jalandhar Toll Roada 100.00 – 100.00 IND Rural Roads Sector II Investment Program – Tranche 2 77.65 – 77.65 IND Bihar State Highways 420.00 – 420.00 IND Rural Roads Sector II Investment Program – Tranche 3 130.00 – 130.00 IND Uttarakhand State-Road Investment Program – Tranche 2 140.00 – 140.00 KAZ CAREC Transport Corridor I (Zhambyl Oblast Section) [Western Europe- Western People’s Republic of China International Transit Corridor] Investment Program – Tranche 1 340.00 – 340.00 PAK Preparing the Lahore Rapid Mass Transit System – 6.00 6.00 PNG Highlands Region Road Improvement Investment Program – Tranche 1b – 100.00 100.00 PRC Central Yunnan Roads Development 200.00 – 200.00 PRC Lanzhou–Chongqing Railway Development 300.00 – 300.00 PRC Chongqing–Lichuan Railway Development 150.00 – 150.00 SRI Southern Transport Development (Supplementary) 90.00 – 90.00 VIE Ho Chi Minh City–Long Thanh–Dau Giay Expressway Construction 410.20 – 410.20 VIE Greater Mekong Subregion: Ha Noi–Lang Son, Greater Mekong Subregion: Ha Long-Mong Cai, and Ben Luc–Long Thanh Expressways Technical Assistance – 26.00 26.00

Subtotal 2,571.88 162.20 2,734.08

– = nil, ADF = Asian Development Fund, ARM = Armenia, AZE = Azerbaijan, CAM = Cambodia, CAREC = Central Asia Regional Economic Cooperation, COO = Cook Islands, IND = India, INO = Indonesia, KAZ = Kazakhstan, MLD = Maldives, OCR = ordinary capital resources, PAK = Pakistan, PHI = Philippines, PNG = Papua New Guinea, PRC = People’s Republic of China, SRI = Sri Lanka, VIE = Viet Nam.a Nonsovereign Loan.b Consists of two ADF loans.

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WATER SUPPY, SANITATION, AND WASTE MANAGEMENT IND Urban Water Supply and Environmental Improvement in Madhya Pradesh (Supplementary) 71.00 – 71.00 PAK Sindh Cities Improvement Investment Program – Tranche 1 – 38.00 38.00 PRC Songhua River Basin Water Pollution Control and Management 200.00 – 200.00 SAM Sanitation and Drainage (Supplementary) – 2.78 2.78 SRI Dry Zone Urban Water and Sanitation – 59.78 59.78 UZB Surkhandarya Water Supply and Sanitation – 30.00 30.00

Subtotal 271.00 130.56 401.56 MULTISECTOR AFG Roshan Expansion (Phase III)a 60.00 – 60.00 BAN Emergency Disaster Damage Rehabilitation (Sector) – 120.00 120.00 BAN Emergency Assistance for Food Security – 170.00 170.00 BAN Public-Private Infrastructure Development Facility 82.00 83.00 165.00 BAN Second Urban Governance and Infrastructure Improvement (Sector) – 87.00 87.00 GEO Municipal Services Development – 40.00 40.00 GEO Emergency Assistance for Post-Conflict Recovery – 70.00 70.00 IND Uttarakhand Urban Sector Development Investment Program – Tranche 1 60.00 – 60.00 IND Rural Electrification Corporation of Indiaa 225.00 – 225.00 INO Rural Infrastructure Support to PNPM Mandiri – 50.00 50.00 INO Infrastructure Reform Sector Development Program (Subprogram 2) 280.00 – 280.00 INO Integrated Citarum Water Resources Management Investment Program – Tranche 1 20.00 30.00 50.00 PAK Barani Integrated Water Resources Sector 55.00 20.00 75.00 PRC Gansu Baiyin Urban Development 80.00 – 80.00 PRC Xinjiang Municipal Infrastructure and Environmental Improvement 105.00 – 105.00 PRC Integrated Ecosystem and Water Resources Management in the Baiyangdian Basin 100.00 – 100.00 PRC Guangxi Wuzhou Urban Development 100.00 – 100.00 PRC Qingdao Water Resources and Wetland Protection 45.00 – 45.00

Subtotal 1,212.00 670.00 1,882.00 TOTAL 8,704.71 1,789.56 10,494.27

– = nil, ADF = Asian Development Fund, AFG = Afghanistan, BAN = Bangladesh, GEO = Georgia, IND = India, INO = Indonesia, OCR = ordinary capital re-sources, PAK = Pakistan, PNPM = Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment), PRC = People’s Republic of China, SAM = Samoa, SRI = Sri Lanka, UZB = Uzbekistan.a Nonsovereign loan.

$ Million OCR ADF Total

CONTINUED

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Statistical Annex 5 SECTORAL DISTRIBUTION OF LOANS,a 2008, 1967–2008

2008 Loans OCR ADF Total Cumulative as of 2008

No. of No. of No. of No. of Sector Loans $ Million Loans $ Million Projectsb $ Million Projectsb $ Million %

Agriculture and Natural Resources 5 385.2 3 58.0 7 443.2 453 17,063.0 12Education – – 2 130.0 2 130.0 143 6,023.8 4Energy 16 2,423.5 2 39.0 15 2,462.5 317 28,502.5 20Finance 3 107.5 1 10.3 4 117.8 185 16,690.0 12Health, Nutrition, and Social Protection 1 38.6 2 172.0 3 210.6 62 3,292.2 2Industry and Trade 1 150.0 2 17.5 3 167.5 151 5,715.0 4Law, Economic Management, and Public Policy 7 1,545.0 5 400.0 10 1,945.0 56 7,741.4 5Transport and Communications 14 2,571.9 7 162.2 18 2,734.1 378 35,115.6 24Water Supply, Sanitation, and Waste Management 2 271.0 4 130.6 6 401.6 155 7,311.7 5Multisector 12 1,212.0 9 670.0 18 1,882.0 247 16,073.1 11

TOTALc 61 8,704.7 37 1,789.6 86 10,494.3 2,147 143,528.4 100

SECTORAL DISTRIBUTION OF GRANTSd, 2008, 1967–2008

2008 Grants

ADF Other Sources Total Cumulative as of 2008

No. of No. of No. of No. of Grants $ Million Grants $ Million Projectse $ Million Projectse $ Million %

Agriculture and Natural Resources 3 62.2 9 22.9 12 85.1 57 461.6 11Education 2 18.0 3 9.8 5 27.8 30 631.9 15Energy 3 244.1 4 15.8 5 259.9 15 328.7 8Finance – – 1 1.0 1 1.0 13 86.8 2Health, Nutrition, and Social Protection 2 12.0 2 3.7 3 15.7 37 262.0 6Industry and Trade 1 10.0 – – 1 10.0 7 30.5 1Law, Economic Management, and Public Policy 5 122.4 – – 4 122.4 16 226.3 6Transport and Communications 5 156.6 4 12.5 7 169.1 27 705.8 17Water Supply, Sanitation, and Waste Management 3 55.4 3 4.5 5 59.9 15 103.6 3Multisector 3 26.7 4 33.8 6 60.5 46 1,247.3 31

TOTALc 27 707.4 30 104.0 49 811.4 263 4,084.5 100

– = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Includes count for an earlier approved loan with supplementary financing in the current year. b A project with multiple loans is counted as one project. c Totals may not add up because of rounding. d Refers to grant-financed projects. Includes count for an earlier approved grant with supplementary financing in the current year.e A project with multiple grants is counted as one project.

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Statistical Annex 6 LOAN AND ADF GRANT APPROVALS, BY COUNTRY AND SOURCE OF FUNDS, 2008 (amounts in $ million)

OCR ADF Loan Loan Grant Total %

Sovereign Afghanistan – – 254.0 254.0 2.3 Armenia – 17.3 – 17.3 0.2 Azerbaijan 215.4 – – 215.4 1.9 Bangladesh 82.0 510.0 – 592.0 5.3 Bhutan 51.0 29.0 25.3 105.3 0.9 Cambodia – 53.8 30.3 84.1 0.8 China, People’s Republic of 1,526.0 – – 1,526.0 13.6 Cook Islands 8.6 6.9 – 15.5 0.1 Georgia – 110.0 – 110.0 1.0 India 1,808.3 – – 1,808.3 16.1 Indonesia 850.0 160.0 – 1,010.0 9.0 Kazakhstan 340.0 – – 340.0 3.0 Kyrgyz Republic – – 65.4 65.4 0.6 Lao People’s Democratic Republic – – 10.0 10.0 0.1 Maldives – 7.5 – 7.5 0.1 Mongolia – – 74.3 74.3 0.7 Nepal – – 139.3 139.3 1.2 Pakistan 642.0 529.0 – 1,171.0 10.5 Papua New Guinea – 100.0 – 100.0 0.9 Philippines 620.0 – – 620.0 5.5 Samoa – 2.8 2.2 5.0 0.0 Solomon Islands – – 14.0 14.0 0.1 Sri Lanka 90.0 59.8 23.2 173.0 1.5 Tajikistan – – 54.8 54.8 0.5 Tonga – – 11.3 11.3 0.1 Tuvalu – – 3.2 3.2 0.0 Uzbekistan 85.0 45.0 – 130.0 1.2 Viet Nam 606.2 158.5 – 764.7 6.8 Subtotal 6,924.5 1,789.6 707.4 9,421.4 84.1 Nonsovereign Afghanistan 60.0 – – 60.0 0.5 China, People’s Republic of 224.1 – – 224.1 2.0 India 1,068.6 – – 1,068.6 9.5 Indonesia 75.0 – – 75.0 0.7 Maldives 7.5 – – 7.5 0.1 Philippines 320.0 – – 320.0 2.9 Viet Nam 25.0 – – 25.0 0.2 Subtotal 1,780.2 – – 1,780.2 15.9 TOTALa 8,704.7 1,789.6 707.4 11,201.6 100.0

– = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Totals may not add up because of rounding.

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Statistical Annex 7 PROJECTS INVOLVING COFINANCING,a 2008 ($ million)

Cofinancing

Official ADB Grants Loans Commercial Source of Cofinancing

CENTRAL AND WEST ASIA 187.30 10.50 20.00 10.00 DVA cofinancing 10.50 – 10.00 Non-DVA cofinancing – 20.00 – Afghanistan Roshan Expansion (Phase III)b 60.00 10.00c, d Commercial lender with ADB political risk guarantee 20.00 Société de Promotion et de Participation pour la Coopération Economique, France

Kyrgyz Republic Southern Agriculture Area Development (Supplementary)e 20.00 2.50c Global Environment Facility (GEF)

Tajikistan Rural Development (Supplementary)e 17.10 3.50c GEF

Uzbekistan Land Improvemente 60.20 3.00c GEF Surkhandarya Water Supply and Sanitation 30.00 1.50c Multidonor Trust Fund under the Water Financing Partnership Facility EAST ASIA 1,572.08 5.70 – 6,381.52 DVA cofinancing 5.70 – 200.00 Non-DVA cofinancing – – 6,181.52 China, People’s Republic of Central Yunnan Roads Development 200.00 211.50 Industrial and Commercial Bank of China (ICBC), People’s Republic of China (PRC) Chongqing–Lichuan Railway Development 150.00 1,385.60 China Construction Bank (CCB), PRC Dryland Sustainable Agriculture 83.00 0.35c Spain Gansu Baiyin Urban Development 80.00 12.08 Domestic banks Capacity Building for Energy Efficiency Clean Energy Fund under the Clean Energy Financing Implementation 35.00 0.80c Partnership Facility Guangxi Wuzhou Urban Development 100.00 80.90 CCB, PRC Inner Mongolia Wind Powerb 24.08 25.00 ICBC, PRC Integrated Ecosystem and Water Resources Management in the Baiyangdian Basin 100.00 4.60 CCB, PRC Lanzhou–Chongqing Railway Development 300.00 3,166.40 CCB, PRC 838.00 ICBC, PRC Municipal District Energy Infrastructure Developmentb 200.00 200.00c Commercial lenders under ADB B-loan 457.14 Commercial banks Ningxia Integrated Ecosystem and Agricultural Development 100.00 4.55c GEF Songhua River Basin Water Pollution Control and Management 200.00 0.30 Domestic banks PACIFIC 14.00 5.72 – – DVA cofinancing 5.72 – – Non-DVA cofinancing – – – Solomon Islands Domestic Maritime Support (Sector) 14.00 5.25c European Commission Road Improvement Sector (Supplementary)e – 0.47c Australian Agency for International Development (AusAID), Australia

– = nil, DVA = direct value-added. a List excludes technical assistance projects. b Nonsovereign private sector loan. c DVA cofinancing.d Cancelled/not made effective.e Anchor ADB project was approved in prior years with cofinancing arranged this year.

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SOUTH ASIA 1,838.80 166.30 1,420.00 4,650.56 DVA cofinancing 41.50 370.00 140.00 Non-DVA cofinancing 124.80 1,050.00 4,510.56

Bangladesh Emergency Disaster Damage Rehabilitation (Sector) 120.00 10.00c Canadian International Development Agency, Canada 60.00c Japan Bank for International Cooperation (JBIC), Japan 20.00c OPEC Fund for International Development (OFID) Post-Literacy and Continuing Education (Supplementary)e – 2.50c Swiss Agency for Development and Cooperation (SDC), Switzerland Public–Private Infrastructure Development Facility 165.00 100.00 Islamic Development Bank Second Urban Governance and Infrastructure Improvement (Sector) 87.00 4.70 Deutsche Gesellschaft für Technische Zusammenarbeit, Germany 36.10 Kredinstalt für Wiederaufbau (KfW), Germany Skills Development 50.00 6.00c SDC Bhutan Green Power Development 105.30 1.00c Asian Clean Energy Fund (Japan) under the Clean Energy Financing Partnership Facility 55.46 Oesterreichische Kontrollbank Aktiengessellschaft, Austria

India Infrastructure Project Financing Facilitye 300.00 2,124.00 Commercial lenders Mundra Ultra Mega Powerb, f 450.00 450.00 International Finance Corporation (IFC) A Loan 1,470.10 Domestic banks 300.00 Korea Export Insurance Corporation (KEIC), Republic of Korea 500.00 The Export–Import Bank of Korea (KEXIM), Republic of Korea National Highway 1 Panipat–Jalandhar Toll Roadb 100.00 140.00c,d Commercial lenders under ADB B-loan 561.00 Domestic banks Orissa Integrated Irrigated Agriculture and Water Management Investment Program 47.20 30.00c OFID Rural Electrification Corporation of Indiag 225.00 80.00c Agence Française de Developpement, France 100.00c European Investment Bank 80.00c KfW

Nepal Governance Support Program (Subprogram 1) 106.30 12.00 Denmark 30.00 Department for International Development (DFID), United Kingdom 6.60 Norway 3.40 SDC 2.25 United Nations Capital Development Fund 4.70 United Nations Development Programme 9.15 United Nations Population Fund 13.90 United Nations Children’s Fund 0.50 Unted Nations Volunteers Rural Reconstruction and Rehabilitation Sector Development Project (Supplementary)e – 20.00c DFID 1.50 SDC

Sri Lanka Dry Zone Urban Water and Sanitation 83.00 2.00c The Netherlands Trust Fund for the Water Financing Partnership Facility

CONTINUED

Cofinancing

Official

ADB Grants Loans Commercial Source of Cofinancing

– = nil, DVA = direct value-added. a List excludes technical assistance projects. b Nonsovereign private sector loan. c DVA cofinancing. d Cancelled/not made effective. e Anchor ADB project was approved in prior years with cofinancing arranged this year.f Includes a tranche of up to $200 million funded by ADB to KEXIM through a risk participation agreement.g Nonsovereign public sector loan.

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SOUTHEAST ASIA 1,361.20 6.60 2,134.60 800.00 DVA cofinancing 6.60 554.60 225.00 Non-DVA cofinancing 1,580.00 575.00 Cambodia Health Sector Support (Supplementary)e – 1.80c DFID Road Asset Management 6.00 4.80c AusAID 30.00 International Development Agency 7.00c OFIDIndonesia Bank Mandiri (Persero)g 75.00 225.00c Commercial lenders under ADB B loan Fourth Development Policy Support Program 200.00 100.00 JBIC 750.00 World Bank (WB) Infrastructure Reform Sector Development Program (Subprogram 2) 280.00 100.00 JBIC 200.00 WB Philippines Acquisition and Rehabilitation of the Masinloc Coal-Fired 200.00 250.00 IFC A-loan Thermal Power Plantb 265.00 Commercial banks Agrarian Reform Communities Project II 70.00 30.00c OFID Privatization and Refurbishment of the Calaca Coal-Fired 120.00 150.00 IFC A-loan Thermal Power Plantb 100.00 Commercial lenders under IFC B-loan 210.00 Domestic banks Viet Nam Ho Chi Minh City–Long Thanh–Dau Giay Expressway Construction 410.20 517.60 c JBIC TOTAL 4,973.38 194.81 3,574.60 11,842.08 DVA cofinancing 70.01 924.60 575.00

Non-DVA cofinancing 124.80 2,650.00 11,267.08 – = nil, DVA = direct value-added. a List excludes technical assistance projects. b Nonsovereign private sector loan. c DVA cofinancing. d Cancelled/not made effective. e Anchor ADB project was approved in prior years with cofinancing arranged this year.f Includes a tranche of up to $200 million funded by ADB to KEXIM through a risk participation agreement.g Nonsovereign public sector loan.

Cofinancing

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Statistical Annex 9a PROGRAM LOAN DISBURSEMENTS, 2008 ($ million)

OCR ADF Total

Afghanistan – 2.53 2.53 Bangladesh – 96.94 96.94 Cambodia – 47.37 47.37 India 290.00 – 290.00 Indonesia 830.00 – 830.00 Lao People’s Democratic Republic – 8.66 8.66 Nepal – 2.59 2.59 Pakistan 1,011.42 508.19 1,519.62 Philippines 587.55 – 587.55 Sri Lanka 15.00 – 15.00 Viet Nam – 47.01 47.01

TOTALa 2,733.98 713.30 3,447.28

– = nil, ADF = Asian Development Fund, OCR = ordinary capital resources.a Totals may not add up because of rounding.

Statistical Annex 8 LOAN DISBURSEMENTS, 2007 and 2008 (amounts in $ thousand)

2 0 0 7

% of % of % of Total Total Total OCR OCR ADF ADF Total Disbursements

Projecta Nondevelopment Finance Institution 1,931,730 37 906,931 56 2,838,661 41 Development Finance Institution 17,178 – – – 17,178 –

Total Project Loans 1,948,908 37 906,931 56 2,855,839 41 Programb 1,972,574 38 566,069 35 2,538,643 37Sectorc 821,662 16 144,630 9 966,292 14 Private Sectord 490,627 9 – – 490,627 7

TOTALe 5,233,771 100 1,617,630 100 6,851,401 100

2 0 0 8

% of % of % of % Change

Total Total Total (2008/2007) OCR OCR ADF ADF Total Disbursements OCR ADF Total

Projecta Nondevelopment Finance Institution 2,256,882 35 1,170,673 57 3,427,555 40 17 29 21 Development Finance Institution 127,860 2 – – 127,860 2 644 – 644

Total Project Loans 2,384,742 37 1,170,673 57 3,555,415 42 22 29 24 Programb 2,733,977 42 713,296 35 3,447,273 40 39 26 36 Sectorc 759,288 12 158,665 8 917,953 11 (8) 10 (5) Private Sectord 594,382 9 – – 594,382 7 21 – 21

TOTALe 6,472,389 100 2,042,634 100 8,515,023 100 24 26 24

– = nil, ( ) = negative, ADF = Asian Development Fund, OCR = ordinary capital resources.a A project loan is provided to finance specific projects. ADB uses development finance institutions in its developing member countries (DMCs) as vehicles to finance

small to medium-sized projects in the private sector.b A program loan is provided to support DMCs’ efforts to improve the policy, institutional, and investment environment of sector development. It helps meet short-

term costs that policy adjustments entail. c A sector loan is provided to develop a specific sector or subsector. It finances a large number of subprojects in a single sector or subsector.d Includes nonsovereign public sector loans and excludes equity investments.e Totals may not add up because of rounding.

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Statistical Annex 9b TRENDS IN PROGRAM LENDING AND GRANT, 1998–2008

Program Loan and ADF Grant Project Loan and ADF Grant Total

Year $ Million % $ Million % $ Million

1998 2,627.5 44 3,355.0 56 5,982.5 1999 1,694.0 34 3,239.6 66 4,933.6 2000 1,102.0 20 4,480.6 80 5,582.6 2001 1,583.0 30 3,755.7 70 5,338.7 2002 1,702.2 30 3,955.7 70 5,657.9 2003 1,139.5 19 4,945.3 81 6,084.8 2004 1,121.4 22 3,917.6 78 5,039.0 2005 1,143.5 19 4,863.7 81 6,007.2 2006 3,204.6 43 4,331.6 57 7,536.2 2007 2,521.0 24 7,963.9 76 10,484.9 2008 2,631.1 23 8,570.6 77 11,201.6

ADF = Asian Development Fund.

Statistical Annex 10 NONSOVEREIGN APPROVALS AND TOTAL PROJECT COSTS BY COUNTRY,a 2008 ($ million)

Equity Total Complementary Partial Political Swap Total Project Invest- ADB Loan Credit Risk with ADB Cost/ Loan ment Funds (B-Loan) Guarantee Guarantee DMCs Approvals Fund Size

Afghanistan Roshan Expansion (Phase III) 60.00 – 60.00 – – 10.00 – 70.00 175.00

China, People’s Republic of Municipal District Energy Infrastructure Development 200.00 – 200.00 200.00 – – – 400.00 1,285.14 Inner Mongolia Wind Power 24.08 – 24.08 – – – – 24.08 73.42

India Mundra Ultra Mega Power 450.00 – 450.00 – – – – 450.00 4,226.75 Gujarat Paguthan Wind Energy Financing Facilityb 105.00 – 105.00 – – – – 105.00 236.77 India Mortgage Guarantee Company – 18.58 18.58 – – – – 18.58 27.87 Columbia Asia Hospitals Development 38.64 – 38.64 – – – – 38.64 154.55 GTL Infrastructure Limited Phase II Telecommunication Infrastructure 150.00 – 150.00 – – – – 150.00 1,184.54 National Highway 1 Panipat–Jalandhar Toll Road 100.00 – 100.00 140.00 – – – 240.00 1,067.00 Rural Electrification Corporation of India 225.00 – 225.00 – – – – 225.00 225.00

Indonesia Bank Mandiri (Persero) 75.00 – 75.00 225.00 – – – 300.00 300.00

Maldives Housing Development Finance Corporation 7.50 4.50 12.00 – – – – 12.00 33.00

Philippines Acquisition and Rehabilitation of the Masinloc Coal-Fired Power Project 200.00 – 200.00 – – – – 200.00 1,100.00 Privatization and Refurbishment of the Calaca Coal-Fired Thermal Power Plant 120.00 – 120.00 – – – – 120.00 890.00

Viet Nam Saigon Thuong Tin Bank (Sacombank) 25.00 – 25.00 – – – – 25.00 25.00

Regional Asian Clean Energy Private Equity Funds – 100.00 100.00 – – – – 100.00 1,100.00

TOTAL 1,780.23 123.08 1,903.31 565.00 – 10.00 – 2,478.30 12,104.05

– = nil, DMC = developing member country.a Includes projects processed by the Private Sector Operations Department and regional departments of ADB. b This project is composed of two loans: (i) Gujarat Paguthan Wind Energy Financing Facility (Samana Phase I - loan amount: $45.0 million; and (ii) CPL Wind Farms

Private Limited (Samana Phase II and the Saundatti Project) - loan amount: $60.0 million.

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Statistical Annex 11 NONSOVEREIGN APPROVALS AND TOTAL PROJECT COSTS BY SECTOR,a 2008 ($ million)

Total Complementary Partial Political Swap Total Total Equity ADB Loan Credit Risk with ADB Project Sector Loan Investment Funds (B-Loan) Guarantee Guarantee DMCs Approvals Cost

Infrastructure 1,634.08 100.00 1,734.08 340.00 – 10.00 – 2,084.08 11,563.63

Investment Funds and Financial Institutions 107.50 23.08 130.58 225.00 – – – 355.58 385.87

Health 38.64 – 38.64 – – – – 38.64 154.55

TOTALb 1,780.23 123.08 1,903.31 565.00 – 10.00 – 2,478.30 12,104.05

– = nil, DMC = developing member country.a Includes projects processed by the Private Sector Operations Department and regional departments of ADB.b Totals may not add up because of rounding.

Statistical Annex 12 NONSOVEREIGN APPROVALS BY YEAR,a, b 1983–2008 (amounts in $ million)

Total Complementary Partial Political Swap Total Total No. of Equity ADB Loan Credit Risk with ADB Project Year Projects Loan Investmentc Funds (B-Loan) Guarantee Guarantee DMCs Approvals Cost

1983 2 – 2.96 2.96 – – – – 2.96 36.001984 1 – 0.42 0.42 – – – – 0.42 2.801985 3 – 3.40 3.40 – – – – 3.40 26.501986 4 6.46 6.01 12.47 – – – – 12.47 20.321987 7 20.50 27.61 48.11 5.00 – – – 53.11 519.241988 12 58.00 35.67 93.67 – – – – 93.67 502.321989 16 95.70 67.59 163.29 51.10 – – – 214.39 1,038.661990 17 78.85 35.94 114.79 24.00 – – – 138.79 2,026.131991 10 156.80 20.52 177.32 – – – – 177.32 1,325.181992 4 50.00 5.42 55.42 81.50 – – – 136.92 402.291993 9 182.10 20.70 202.80 19.30 – – – 222.10 1,505.701994 9 – 48.70 48.70 – – – – 48.70 919.201995 8 68.00 99.41 167.41 5.83 – – – 173.24 1,050.321996 7 98.50 80.15 178.65 91.50 – – – 270.15 1,788.771997 6 45.00 49.50 94.50 – 50.00 – – 144.50 1,239.691998 6 136.12 39.44 175.56 151.08 65.00 – – 391.64 1,152.701999 3 101.50 7.40 108.90 61.50 – – – 170.40 847.702000 9 152.00 77.65 229.65 45.00 – 122.00 – 396.65 1,629.842001 6 37.50 30.36 67.86 – – – – 67.86 648.002002 6 110.00 25.53 135.53 – – 60.00 – 195.53 1,136.602003 7 167.00 35.65 202.65 170.00 170.00 – – 542.65 2,300.002004 14 92.50 164.37 256.87 – – 10.00 – 266.87 2,227.702005 13 513.02 176.50 689.52 – 18.40 50.00 – 757.92 8,676.422006 18 450.00 230.50 680.50 330.00 109.80 15.00 – 1,135.30 7,678.342007 23 725.27 79.75 805.02 200.00 376.00 – – 1,381.02 3,644.542008 16 1,780.23 123.08 1,903.31 565.00 – 10.00 – 2,478.31 12,104.05

TOTAL 236 5,125.05 1,494.23 6,619.28 1,800.81 789.20 267.00 – 9,476.29 54,449.01

– = nil, DMC = developing member country. a Includes nonsovereign projects processed by the Private Sector Operations Department and regional departments of ADB. Regional departments started nonsovereign

operations in 2007. b Net of facilities canceled in full before signing.c Includes equity investments, lines of equity, and equity underwriting.

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Statistical Annex 13 NONSOVEREIGN APPROVALS BY COUNTRY,a, b 1983–2008 (amounts in $ million)

Total Complementary Partial Political Swap Total Total No. of Equity ADB Loan Credit Risk with ADB Project Projects Loan Investmentc Funds (B-Loan) Guarantee Guarantee DMCs Approvals Cost

Afghanistan 6 135.00 8.10 143.10 30.00 – 35.00 – 208.10 650.70 Azerbaijan 4 66.00 – 66.00 – – – – 66.00 66.00 Bangladesh 8 137.20 14.98 152.18 20.00 – 70.00 – 242.18 890.36 Bhutan 1 – 0.53 0.53 – – – – 0.53 0.79 Cambodia 1 8.00 – 8.00 – – – – 8.00 32.00 China, People’s Republic of 21 571.30 369.30 940.60 646.50 107.00 – – 1,694.10 6,519.28 Georgia 1 25.00 – 25.00 – – – – 25.00 125.00 India 37 1,660.61 237.31 1,897.92 370.00 – – – 2,267.92 15,690.85 Indonesia 15 557.00 23.85 580.85 288.50 9.80 – – 879.15 7,472.02 Kazakhstan 5 225.00 – 225.00 – 325.00 – – 550.00 1,050.00 Korea, Republic of 3 – 8.96 8.96 – – – – 8.96 288.00 Lao People’s Democratic Republic 1 50.00 – 50.00 – – 50.00 – 100.00 1,450.00 Malaysia 2 10.00 2.00 12.00 – – – – 12.00 29.24 Maldives 2 12.00 4.50 16.50 – – – – 16.50 37.50 Mongolia 2 14.50 1.60 16.10 – – – – 16.10 50.00 Nepal 4 49.55 3.26 52.81 5.83 – – – 58.64 218.03 Pakistan 27 429.10 53.38 482.48 129.90 109.00 – – 721.38 2,997.01 Philippines 28 595.32 40.85 636.17 113.58 18.40 – – 768.15 4,688.72 Samoa 1 – 0.40 0.40 – – – – 0.40 1.60 Sri Lanka 13 99.50 13.58 113.08 – 115.00 52.00 – 280.08 543.48 Thailand 10 71.46 77.07 148.53 170.00 – – – 318.53 3,067.55 Viet Nam 8 218.50 – 218.50 26.50 – 60.00 – 305.00 1,520.00 Regional 36 190.00 634.57 824.57 – 105.00 – – 929.57 7,060.87

TOTAL 236 5,125.05 1,494.23 6,619.28 1,800.81 789.20 267.00 – 9,476.30 54,449.01 – = nil, DMC = developing member country. a Includes nonsovereign projects processed by the Private Sector Operations Department and regional departments of ADB. Regional departments started nonsovereign

operations in 2007. b Net of facilities canceled in full before signing.c Includes equity investments, lines of equity, and equity underwriting.

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Statistical Annex 14 NUMBER OF LOANS AND PROJECTS APPROVED AND UNDER ADMINISTRATION, PROJECT COMPLETION REPORTS (PCRs) CIRCULATED, PROJECTS COMPLETED, LOANS CLOSED, AND PROJECT/PROGRAM PERFORMANCE EVALUATION REPORTS (PPERs) CIRCULATED (as of 31 December 2008)

Cumulative Cumulative Cumulative Cumulative Cumulative Cumulative No. of No. of No. of No. of No. of No. of Loans Effective Projects Blended Supplementary Cofinanced Approveda Loans Approvedb Loans Loans Projectsc

Afghanistan 23 22 21 1 1 5Armenia 3 2 2 – 1 –Azerbaijan 13 11 9 3 – –Bangladesh 192 188 169 14 4 26Bhutan 25 23 22 2 – 1Cambodia 46 46 36 2 1 9China, People’s Republic of 154 142 151 – – 21Cook Islands 15 13 14 1 – –Fiji Islands 16 16 16 – – 1Georgia 3 3 3 – – –Hong Kong, China 5 5 5 – – –India 130 119 106 3 2 15Indonesia 297 293 261 25 2 26Kazakhstan 17 15 12 2 – 3Kiribati 6 6 6 – – –Korea, Republic of 81 81 80 – – –Kyrgyz Republic 26 26 20 – – 4Lao People’s Democratic Republic 68 68 60 1 3 9Malaysia 77 77 75 1 1 –Maldives 19 17 19 – – 2Marshall Islands 12 12 11 1 – –Micronesia, Federated States of 8 8 6 1 – –Mongolia 41 41 35 – – 2Myanmar 32 32 28 2 2 6Nauru 1 1 1 – – –Nepal 116 116 104 2 9 20Pakistan 284 272 214 45 5 38Papua New Guinea 63 61 48 12 2 8Philippines 204 200 173 18 4 33Samoa 33 31 28 – 4 3Singapore 14 14 14 – – –Solomon Islands 16 16 15 – – 3Sri Lanka 143 141 121 11 7 26Taipei,China 12 12 12 – – –Tajikistan 23 22 17 3 – 5Thailand 84 84 80 2 2 7Timor-Leste – – – – – –Tonga 15 14 15 – – 1Turkmenistan – – – – – –Tuvalu 3 3 2 – 1 –Uzbekistan 29 25 24 4 – 4Vanuatu 9 9 8 – 1 –Viet Nam 98 86 84 4 1 15Regional 7 6 20f 1 – 1 TOTAL 2,463 2,379 2,147 161 53 294

– = 0. a Includes nonsovereign loans but excludes terminated loans.b A project with multiple loans is counted as one project. Supplementary loans, special implementation assistance loans, and subprogram loans of program loan

clusters are not counted as separate projects.c These are non-ADB funds generated by ADB’s financing partnership operations including loans, credit enhancements, and grants, fully or partially administered by

ADB, and/or cofinanced under cooperation/sector-wide approach arrangements. d Includes projects/loans which have been approved but awaiting effectivity, inactive loans, fully disbursed nonsovereign loans, but still under administration; excludes

projects/loans exclusively financed from other sources.

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No. of No. of No. of No. of No. of No. of Cumulative Projects Loans of PCRs PPERs Loans Under Projects Under No. of PCRs Completed Closed Circulated Circulated Administrationd Administrationa,d,g Circulatedg in 2008e,g in 2008 in 2008g in 2008g

13 13 – – – – – Afghanistan 3 2 – – – – – Armenia 13 9 – 1 – – – Azerbaijan 53 42 125 2 2 5 – Bangladesh 6 4 16 – 1 1 – Bhutan 20 19 17 6 4 5 1 Cambodia 62 60 84 3 7 6 2 China, People’s Republic of 3 2 12 – – – – Cook Islands 2 2 11 – 1 1 – Fiji Islands 3 3 – – – – – Georgia – – 5 – – – – Hong Kong, China 56 46 52 – 3 8 2 India 36 30 203 6 6 12 – Indonesia 8 6 8 1 – – – Kazakhstan – – 5 – 1 1 – Kiribati – – 61 – – – – Korea, Republic of 7 7 16 – 2 3 – Kyrgyz Republic 18 16 42 3 6 5 1 Lao People’s Democratic Republic 1 1 56 – – – – Malaysia 10 10 8 1 – – – Maldives – – 10 – – 1 – Marshall Islands 4 3 3 – – – – Micronesia, Federated States of 13 12 19 2 2 1 2 Mongolia – – 26 – – – – Myanmar – – 1 – – – – Nauru 24 22 82 2 1 4 – Nepal 65 46 141 9 15 8 – Pakistan 10 6 36 1 5 1 1 Papua New Guinea 17 17 134 3 6 2 – Philippines 5 4 22 1 – – – Samoa – – 7 – – – – Singapore – – 14 – 1 – – Solomon Islands 46 36 80 6 4 4 1 Sri Lanka – – 1 – – – – Taipei,China 13 13 7 1 1 1 – Tajikistan 1 1 59 – – – – Thailand – – 5 – – 1 – Timor-Leste – – 16 – – – – Tonga – – – – – – – Turkmenistan 2 1 1 – – – – Tuvalu 19 17 7 – – 2 – Uzbekistan – – 8 – – – – Vanuatu 43 39 37 1 7 9 3 Viet Nam 3 3 5 – – 1 1 Regional 579 492 1,442 49 75 82 14 TOTAL

e Projects which were physically completed in 2008.f Includes the regional projects—Greater Mekong Subregion (GMS): Phnom Penh to Ho Chi Minh City Highway (Cambodia and Viet Nam loan components); GMS:

East–West Corridor (Lao People’s Democratic Republic [Lao PDR] and Viet Nam loan components); Almaty–Bishkek Regional Road Rehabilitation (Kazakhstan and Kyrgyz Republic loan components); GMS: Mekong Tourism Development (Cambodia, Lao PDR, and Viet Nam loan components); Regional Power Transmission Modernization (Tajikistan and Uzbekistan loan components); Regional Trade Facilitation and Customs Cooperation Program (Kyrgyz Republic and Tajikistan loan components); Asian Finance and Investment Corporation, Ltd.; Trade Finance Facilitation Program; Establishment of the Pacific Aviation Safety Office Project; Regional Power Transmission Interconnection (Afghanistan and Tajikistan loan components); Micro and Small Enterprise Financing Facility; and GMS Sustainable Tourism Development (Viet Nam loan component and Lao PDR grant component).

g Regional projects with loans to multiple countries are reported separately.

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Statistical Annex 15 AMOUNT OF LOANS APPROVED, CONTRACTS AWARDED, AND DISBURSEMENTS ($ million; as of 31 December 2008)

Cumulative Cumulative Loans Cumulative Net Contracts Contracts Approveda Effective Loansb, c Awarded in 2008c, d, e Awardedc, d, e

Afghanistan 952.28 925.19 53.21 608.84 Armenia 83.92 67.37 22.90 22.90 Azerbaijan 585.40 373.00 31.80 85.35 Bangladesh 9,857.49 8,833.74 506.21 6,811.09 Bhutan 256.06 173.44 18.78 135.87 Cambodia 1,001.14 1,005.91 109.59 857.67 China, People’s Republic of 21,004.18 17,960.92 1,312.17 14,069.07 Cook Islands 45.01 27.99 – 30.18 Fiji Islands 249.90 217.09 6.18 193.63 Georgia 135.00 133.00 69.86 69.86 Hong Kong, China 101.50 94.50 – 94.50 India 20,586.50 16,548.83 1,006.44 13,231.83 Indonesia 23,523.30 19,418.06 1,031.96 17,029.71 Kazakhstan 1,066.60 646.52 10.56 449.40 Kiribati 15.14 13.70 0.07 14.49 Korea, Republic of 6,338.33 5,560.33 – 5,572.55 Kyrgyz Republic 603.50 605.51 9.57 546.20 Lao People’s Democratic Republic 1,211.34 1,216.76 30.85 1,103.55 Malaysia 1,997.54 1,413.98 – 1,422.40 Maldives 116.31 106.04 4.46 78.74 Marshall Islands 78.13 64.15 – 65.12 Micronesia, Federated States of 75.14 70.15 1.56 48.71 Mongolia 676.54 671.49 18.86 576.46 Myanmar 530.86 411.83 – 418.77 Nauru 5.00 2.30 – 2.30 Nepal 2,300.98 2,032.93 64.61 1,717.87 Pakistan 19,761.84 17,057.83 1,804.11 14,137.67Papua New Guinea 1,126.99 892.88 16.36 725.78 Philippines 10,772.83 8,597.89 627.95 7,650.91 Samoa 159.37 149.93 9.58 119.51 Singapore 181.08 144.44 – 130.22 Solomon Islands 79.31 65.82 0.02 65.39 Sri Lanka 4,355.53 4,141.72 605.84 3,553.77 Taipei,China 100.39 91.14 – 90.28 Tajikistan 372.54 369.70 67.09 292.69 Thailand 5,388.07 4,207.65 – 4,158.08 Tonga 57.79 52.26 – 58.18 Tuvalu 7.82 8.15 0.04 7.67 Uzbekistan 1,230.90 948.27 58.63 548.57 Vanuatu 51.25 48.99 – 47.91 Viet Nam 6,294.12 4,219.83 372.58 2,677.82 Regionalg 191.50 174.61 0.67 1.28

TOTALh 143,528.39 119,765.84 7,872.48 99,522.80

– = nil or data not applicable. a Data include nonsovereign loans but exclude terminated loans. The US dollar equivalent is in accordance with the exchange rate prevailing within ADB at the time

of loan approval. b Net refers to effective loan amounts less cancellations. c The US dollar equivalent is in accordance with the exchange rate prevailing in ADB on 31 December 2008. d Data exclude nonsovereign loans. e Contracts awarded for development finance institutions/credit loans are based on the amount of subloan disbursements.

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% of Cumulative % of Cumulative Contracts Awarded Disbursements to Cumulative Net Disbursements Cumulative to Cumulative Net Effective Loansc in 2008 Disbursementsf Effective Loans

65.81 80.54 559.50 60.47 Afghanistan 33.99 8.03 8.03 11.92 Armenia 22.88 20.76 87.88 23.56 Azerbaijan 77.10 615.64 6,856.05 77.61 Bangladesh 78.34 4.27 116.59 67.22 Bhutan 85.26 113.45 789.34 78.47 Cambodia 78.33 1,292.81 13,437.54 74.82 China, People’s Republic of 107.81 1.34 27.91 99.69 Cook Islands 89.19 9.67 192.53 88.69 Fiji Islands 52.52 69.86 94.86 71.32 Georgia 100.00 – 94.50 100.00 Hong Kong, China 79.96 1,655.63 12,005.42 72.55 India 87.70 1,003.15 18,400.99 94.76 Indonesia 69.51 8.31 619.04 95.75 Kazakhstan 105.74 – 13.70 100.00 Kiribati 100.22 – 5,560.32 100.00 Korea, Republic of 90.20 27.11 552.15 91.19 Kyrgyz Republic 90.70 52.51 1,134.33 93.23 Lao People’s Democratic Republic 100.60 – 1,413.98 100.00 Malaysia 74.25 2.72 71.49 67.41 Maldives 101.51 – 64.15 100.00 Marshall Islands 69.44 3.56 46.35 66.07 Micronesia, Federated States of 85.85 34.68 579.47 86.30 Mongolia 101.68 – 411.83 100.00 Myanmar 100.00 – 2.30 100.00 Nauru 84.50 61.66 1,703.70 83.80 Nepal 82.88 1,923.34 14,234.56 83.45 Pakistan 81.28 19.88 710.59 79.58 Papua New Guinea 88.99 853.17 8,389.48 97.58 Philippines 79.71 2.63 108.29 72.22 Samoa 90.15 – 144.44 100.00 Singapore 99.35 0.07 65.82 100.00 Solomon Islands 85.80 259.54 3,161.71 76.34 Sri Lanka 99.06 – 91.14 100.00 Taipei,China 79.17 50.01 223.10 60.35 Tajikistan 98.82 – 4,207.65 100.00 Thailand 111.32 – 52.26 100.00 Tonga 94.12 0.60 7.16 87.86 Tuvalu 57.85 48.97 534.00 56.31 Uzbekistan 97.80 – 48.99 100.00 Vanuatu 63.46 264.56 2,633.66 62.41 Viet Nam 0.73 26.55 162.84 93.26 Regional

83.10 8,515.02 99,619.63 83.18 TOTAL

f The cumulative disbursements may exceed the cumulative contracts awarded due to disbursed amount without procurement contract summary sheet, e.g., interest during construction, contingencies, and nonsovereign loans which do not require procurement.

g Data include regional loan on Establishment of the Pacific Aviation Safety Office and private sector loans to Asian Finance and Investment Corporation Ltd., Trade Finance Facilitation Program, and Micro and Small Enterprise Financing Facility.

h Totals may not add up because of rounding.

Asian Development Bank182ST

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Statistical Annex 16 TECHNICAL ASSISTANCE GRANT APPROVALS BY COUNTRY AND REGIONAL ACTIVITIES,a, b 1967–2008, 2007, 2008 (amounts in $ thousand)

1 9 6 7 – 2 0 0 8 2 0 0 7

TASF JSF PEF RCIF Other No. Amount % No. Financing Financing Financing Financing Sources Total %

Afghanistan 60 65,647.70 1.85 2 2,800.00 – – – 1,700.00 4,500.00 1.78Armenia 5 2,200.00 0.06 3 900.00 – – – – 900.00 0.36Azerbaijan 22 12,122.00 0.34 – – – – – – – – Bangladesh 331 183,156.17 5.17 8 4,867.85 1,825.00 – – 1,000.00 7,692.85 3.04

Bhutan 105 42,443.15 1.20 4 1,080.00 1,600.00 – – – 2,680.00 1.06Brunei Darussalam 1 600.00c 0.02 – – – – – – – – Cambodia 151 99,384.60 2.80 5 1,259.00 475.00 – – 1,250.00 2,984.00 1.18China, People’s Republic of 563 310,321.65 8.75 33 17,314.00 – – – 3,168.00 20,482.00 8.10

Cook Islands 29 9,995.00 0.28 1 – 500.00 – – 200.00 700.00 0.28Fiji Islands 80 27,349.80 0.77 1 250.00 – – – – 250.00 0.10Georgia 2 720.00 0.02 1 120.00 – – – – 120.00 0.05

India 254 181,634.86 5.12 11 3,500.00 6,800.00 – – 500.00 10,800.00 4.27Indonesia 498 276,609.17d 7.80 9 14,510.00d 900.00 – – 750.00 16,160.00 6.39Kazakhstan 58 26,177.00 0.74 1 60.00 – – – – 60.00 0.02Kiribati 36 12,840.70 0.36 – – – – – – – –

Korea, Republic of 33 5,010.15 0.14 – – – – – – – – Kyrgyz Republic 71 40,951.40 1.15 3 1,200.00 – – – 500.00 1,700.00 0.67Lao People’s Democratic Republic 234 118,107.08 3.33 5 1,350.00 2,293.00 – – 500.00 4,143.00 1.64

Malaysia 93 25,352.30 0.71 – – – – – – – – Maldives 56 19,525.00 0.55 – – – – – – – – Marshall Islands 46 18,757.00 0.53 – – – – – – – –

Micronesia, Federated States of 42 24,428.00 0.69 1 – 400.00 – – – 400.00 0.16Mongolia 134 69,370.65 1.96 3 450.00 2,100.00 – – – 2,550.00 1.01Myanmar 38 10,716.00 0.30 – – – – – – – –

Nauru 7 1,946.81 0.05 – – – – – – – – Nepal 279 132,139.70 3.73 10 4,850.00 1,950.00 – 300.00 120.00 7,220.00 2.86Pakistan 325 187,931.13 5.30 10 5,733.00 1,000.00 2,000.00 – 11,500.00 20,233.00 8.00Palau, Republic of 3 2,100.00 0.06 2 – 1,700.00 – – – 1,700.00 0.67

Papua New Guinea 137 54,651.12 1.54 5 160.00 1,500.00 – – 213.52 1,873.52 0.74Philippines 334 158,264.25 4.46 4 1,300.00 1,350.00 – – – 2,650.00 1.05Samoa 85 27,081.50 0.76 3 105.00 1,100.00 – – 1,250.00 2,455.00 0.97

Singapore 2 577.42 0.02 – – – – – – – – Solomon Islands 59 18,245.24 0.51 2 800.00 2,000.00 – – – 2,800.00 1.11Sri Lanka 229 96,398.10 2.72 1 – – – – 600.00 600.00 0.24

Taipei,China 1 100.00 0.003 – – – – – – – – Tajikistan 58 33,886.06 0.96 5 1,661.06 600.00 – – 1,000.00 3,261.06 1.29Thailand 159 60,299.60 1.70 2 300.00 700.00 – – – 1,000.00 0.40

Timor-Leste 30 28,550.90 0.81 1 3,000.00 – – – 12,000.00 15,000.00 5.93Tonga 55 16,051.50 0.45 – – – – – – – – Turkmenistan 4 715.00 0.02 1 150.00 – – – – 150.00 0.06Tuvalu 20 5,914.75 0.17 – – – – – – – –

Uzbekistan 71 37,080.00 1.05 2 1,400.00 – – – – 1,400.00 0.55Vanuatu 55 16,364.76 0.46 1 – 600.00 – – – 600.00 0.24Viet Nam 235 177,804.46 5.01 20 3,295.00 6,745.00 – – 3,085.00 13,125.00 5.19

All DMCs 5,090 2,639,521.68 74.44 160 72,414.90 36,138.00 2,000.00 300.00 39,336.52 150,189.43 59.40Regional 1,509 906,254.61 25.56 82 38,277.25 6,950.00 – 7,100.00 50,325.70 102,652.95 40.60

TOTAL 6,599 3,545,776.29 100.00 242 110,692.15 43,088.00 2,000.00 7,400.00 89,662.22 252,842.38 100.00

– = nil or data not applicable, CCF = Climate Change Fund, DMC = developing member country, JSF = Japan Special Fund, PEF = Pakistan Earthquake Fund, RCIF = Regional Cooperation and Integration Fund, TASF = Technical Assistance Special Fund.a Excludes technical assistance financed under loans that are included in ADB’s loan data.b Data are adjusted to exclude technical assistance projects withdrawn by governments.c Reimbursable technical assistance.d Includes $10 million from ordinary capital resources as a contribution to the Java Reconstruction Fund.

183Annual Report 2008STA

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TASF JSF RCIF CCF Other No. Financing Financing Financing Financing Sources Total %

3 1,155.00 1,800.00 – – – 2,955.00 1.08 Afghanistan 1 1,000.00 – – – – 1,000.00 0.36 Armenia 2 1,150.00 – – – – 1,150.00 0.42 Azerbaijan 8 2,925.00 990.00 – 600.00 – 4,515.00 1.64 Bangladesh

3 950.00 650.00 888.00 – – 2,488.00 0.91 Bhutan 1 – – – – 600.00 c 600.00 0.22 Brunei Darussalam 8 3,221.00 1,800.00 – – – 5,021.00 1.83 Cambodia China, People’s 31 15,900.00 – – 1,400.00 2,150.00 19,450.00 7.09 Republic of

2 350.00 – – – – 350.00 0.13 Cook Islands 2 125.00 – – – – 125.00 0.05 Fiji Islands 1 600.00 – – – – 600.00 0.22 Georgia

25 14,165.00 9,800.00 – – 3,450.00 27,415.00 9.99 India 8 3,950.00 1,300.00 – – 7,700.00 12,950.00 4.72 Indonesia 1 300.00 – – – – 300.00 0.11 Kazakhstan 1 – 800.00 – – – 800.00 0.29 Kiribati

– – – – – – – – Korea, Republic of 3 1,250.00 – – – – 1,250.00 0.46 Kyrgyz Republic Lao People’s 9 3,545.00 600.00 – – 977.00 5,122.00 1.87 Democratic Republic

– – – – – – – – Malaysia – – – – – – – – Maldives – – – – – – – – Marshall Islands

Micronesia, Federated 1 – 750.00 – – – 750.00 0.27 States of 6 1,300.00 3,200.00 – – 1,000.00 5,500.00 2.00 Mongolia – – – – – – – – Myanmar

1 225.00 – – – – 225.00 0.08 Nauru 10 2,600.00 1,300.00 – – 646.00 4,546.00 1.66 Nepal 10 6,202.00 1,600.00 – – 80.00 7,882.00 2.87 Pakistan 1 – 400.00 – – – 400.00 0.15 Palau, Republic of

4 225.00 2,800.00 – – – 3,025.00 1.10 Papua New Guinea 11 3,850.00 3,160.00 – – 2,400.00 9,410.00 3.43 Philippines 1 – 1,200.00 – – – 1,200.00 0.44 Samoa

– – – – – – – – Singapore 1 1,000.00 – – – 600.00 1,600.00 0.58 Solomon Islands 6 1,550.00 300.00 – – 50.00 1,900.00 0.69 Sri Lanka

– – – – – – – – Taipei,China 2 240.00 – 650.00 – – 890.00 0.32 Tajikistan 4 1,270.00 – – – 1,500.00 2,770.00 1.01 Thailand

2 – 1,300.00 – – – 1,300.00 0.47 Timor-Leste 1 – 700.00 – – – 700.00 0.26 Tonga – – – – – – – – Turkmenistan 2 800.00 – – – 327.75 1,127.75 0.41 Tuvalu

3 350.00 1,200.00 – – – 1,550.00 0.56 Uzbekistan – – – – – – – – Vanuatu 22 6,465.00 5,600.00 – – 14,790.00 26,855.00 9.78 Viet Nam

197 76,663.00 41,250.00 1,538.00 2,000.00 36,270.75 157,721.75 57.46 All DMCs 102 42,641.97 13,700.00 8,920.00 3,000.00 48,517.63 116,779.60 42.54 Regional

299 119,304.97 54,950.00 10,458.00 5,000.00 84,788.38 274,501.35 100.00 TOTAL


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Statistical Annex 17 TECHNICAL ASSISTANCE GRANT APPROVALS, 2008 ($ thousand)

TA Type Sector TASF JSF RCIF CCF Others Source Total

Afghanistan Water Resources Development PP AG – 1,800.00 – – – 1,800.00 Security Plan for Project Implementation AD LW 995.00 – – – – 995.00 Development of Wind Energy AD EN 160.00 – – – – 160.00

Subtotal 1,155.00 1,800.00 – – – 2,955.00

Armenia North–South Road Corridor Development Program PP TC 1,000.00 – – – – 1,000.00

Subtotal 1,000.00 – – – – 1,000.00

Azerbaijan Power Transmission Enhancement PP EN 150.00 – – – – 150.00 Railways Sector Development Program PP TC 1,000.00 – – – – 1,000.00

Subtotal 1,150.00 – – – – 1,150.00

Bangladesh Urban Primary Health Care Sector Development Program (Supplementary) PP HL 400.00 – – – – 400.00 Financial Management and Monitoring AD MS 200.00 – – – – 200.00 Strengthening the Government’s Institutional Capacity for Improving Food Security AD MS 600.00 – – – – 600.00 Capacity Development for the Infrastructure Development Company Limited AD MS 500.00 – – – – 500.00 Primary Education Sector Development Program PP ED – 990.00 – – – 990.00 Strengthening the Resilience of the Water Sector in Khulna to Climate Change AD MS – – – 600.00 – 600.00 Capacity Development for Madrasah Education AD ED 1,000.00 – – – – 1,000.00 Supporting the Establishment of Khulna Water Supply and Sewerage Authority AD WS 225.00 – – – – 225.00

Subtotal 2,925.00 990.00 – 600.00 – 4,515.00

Bhutan Strengthening of the Credit Information Bureau AD FI 350.00 – – – – 350.00 Road Network II PP TC – 650.00 – – – 650.00 Promotion of Clean Power Export Development AD EN 600.00 – 888.00 – – 1,488.00

Subtotal 950.00 650.00 888.00 – – 2,488.00

Brunei Darussalam Development of the Capital Market and a Modernized Payment and Settlement Systema AD FI – – – – 600.00 Brunei 600.00 Darussalam

Subtotal – – – – 600.00 600.00

Cambodia Enhancing the Resettlement Legal Framework and Institutional Capacity (Supplementary) AD HL 71.00 – – – – 71.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; ED = education; EN = energy; FI = finance; HL = health, nutrition, and social protection; JSF = Japan Special Fund; LW = law, economic management, and public policy; MS = multisector; PP = project prepara-tory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.a Approved by the President on a reimbursable basis by the Government of Brunei Darussalam.


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Private Sector and Small and Medium-Sized Enterprise Development Program PP LW 550.00 – – – – 550.00 Second Rural Water Supply and Sanitation Sector PP WS – 500.00 – – – 500.00 Strengthening Technical and Vocational Education and Training PP ED – 800.00 – – – 800.00 Strengthening Institutional Capacity for Emergency Response to Food Crisis and Improving Food Security AD AG 1,500.00 – – – – 1,500.00 Implementation of Key Policy Triggers of Subprogram 3 AD FI 300.00 – – – – 300.00 Enhancing Private Sector Competitiveness AD LW 800.00 – – – – 800.00 Provincial/Rural Road Asset Management PP TC – 500.00 – – – 500.00

Subtotal 3,221.00 1,800.00 – – – 5,021.00

China, People’s Republic of Western Yunnan Roads Development II (Supplementary) PP TC 100.00 – – – – 100.00 Lanzhou Sustainable Urban Transport (Supplementary) PP TC 150.00 – – – – 150.00 Asset-Backed Securitization for Expressway Financing and Corporate Debt Restructuring in Yunnan Province AD FI 150.00 – – – – 150.00 Providing Emergency Response to Sichuan Earthquake AD MS 1,000.00 – – – – 1,000.00 Urban Wastewater Reuse and Sludge Utilization Policy Study AD WS 700.00 – – – 300.00 MDTF-WFPF 1,000.00 People’s Republic of China: Supporting Fiscal Reforms in High Priority Sectors AD LW 1,000.00 – – – – 1,000.00 Qinghai Rural Water Resources Management PP AG 700.00 – – – – 700.00 Chongqing Urban–Rural Infrastructure Development Demonstration PP MS 900.00 – – – – 900.00 Strengthening the Capacity of the Judiciary to Implement Economic Laws AD LW 400.00 – – – – 400.00 Heilongjiang Road Development II (Yichun to Nenjiang) PP TC 600.00 – – – – 600.00 Anhui Road Network Development PP TC 600.00 – – – – 600.00 River Basin Water Resources Allocation and Management Policy AD AG 500.00 – – – 250.00 MDTF-WFPF 750.00 Capacity Strengthening in Planning and Implementation of Integrated Gasification Combined Cycle Plan AD EN 200.00 – – – – 200.00 Enhancing the Competitiveness and Efficiency of Railway Passenger Operations AD TC 500.00 – – – – 500.00 New Models for Civil Society Participation in Poverty Reduction AD HL 400.00 – – – – 400.00 Guangxi Border Cities Development PP MS 800.00 – – – – 800.00 Improvement of Public Employment Service System in the Western Region AD HL 400.00 – – – – 400.00 Chongqing–Guiyang Railway Development PP TC 500.00 – – – – 500.00 Provincial Development Strategies for Two Northeastern Provinces AD MS 800.00 – – – – 800.00 Railway Sector Energy Efficiency Strategy AD TC – – – – 800.00 CEF 800.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; CEF = Clean Energy Fund; ED = education; EN = energy; FI = finance; HL = health, nutrition, and social protection; JSF = Japan Special Fund; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Transport Efficiency through Logistics Development Policy Study AD TC 500.00 – – – – 500.00 Rural Finance Development and Supervision AD FI 400.00 – – – – 400.00 Wuhan Urban Environmental Improvement PP WS 700.00 – – – – 700.00 Jiangxi Sustainable Forest Ecosystem Development PP AG 700.00 – – – – 700.00 Preparing National Guidelines for Eco- Compensation in River Basins and a Framework for Soil Pollution Management AD AG 400.00 – – – 400.00 MDTF-WFPF 800.00 Design of the National Sulfur Dioxide Emission Trading System AD EN 500.00 – – – – 500.00 Fiscal Policy Support for Economic Development in Henan AD LW 400.00 – – – – 400.00 Utilization of Foreign Capital to Promote Energy Conservation and Energy-Efficient Power Generation Scheduling AD EN 600.00 – – 900.00 – 1,500.00 China Clean Development Mechanism Fund Capacity Development AD EN 300.00 – – 500.00 – 800.00 Promoting a More Inclusive and Effective Disaster Risk Management System AD MS 650.00 – – – – 650.00 Enabling the Protection of Jiaozhou Bay Water Quality and Wetland Ecosystem AD MS 350.00 – – – 400.00 MDTF-WFPF 750.00

Subtotal 15,900.00 – – 1,400.00 2,150.00 19,450.00

Cook Islands Infrastructure Development (Supplementary) PP MS 125.00 – – – – 125.00 Public Sector Review and Improvement AD LW 225.00 – – – – 225.00

Subtotal 350.00 – – – – 350.00

Fiji Islands Fourth Road Upgrading (Sector) (Supplementary) PP TC 50.00 – – – – 50.00 Preparing Economic Restructuring Program Loan (Supplementary) PP LW 75.00 – – – – 75.00

Subtotal 125.00 – – – – 125.00

Georgia Ajara Bypass Roads Development PP TC 600.00 – – – – 600.00

Subtotal 600.00 – – – – 600.00

India Chhattisgarh State Roads Sector Development (Supplementary) PP TC 990.00 – – – – 990.00 Mainstreaming Public–Private Partnerships at State Level (Supplementary) AD LW 2,000.00 – – – – 2,000.00 Capacity Development of the National Capital Region Planning Board AD MS 2,000.00 – – – – 2,000.00 Developing the Power System Master Plan for Bihar AD EN 600.00 – – – – 600.00 Knowledge Management for Enhanced Operational Effectiveness AD MS 1,000.00 – – – – 1,000.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; EN = energy; FI = finance; JSF = Japan Special Fund; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Energy Efficiency Enhancement Project in Assam PP EN – 1,000.00 – – – 1,000.00 Integrated Renewable Energy Development PP EN 1,400.00 – – – – 1,400.00 Bihar Urban Development PP WS – 1,000.00 – – – 1,000.00 National Capital Region Planning Board PP MS – 700.00 – – – 700.00 Integrated Flood and River Erosion Management – Arunachal Pradesh PP AG 150.00 – – – 750.00 MDTF-WFPF 900.00 Supporting the Assam Governance and Public Resource Management Sector Development Program (Subprogram II) AD LW – 600.00 – – – 600.00 Institutional Strengthening of the Bihar Road Sector AD TC 1,000.00 – – – – 1,000.00 Institutional Development of Integrated Water Resources Management in Orissa AD AG – – – – 250.00 MDTF-WFPF 250.00 Preparing and Enhancing Readiness of Proposed North Eastern State Roads Investment Program PP TC 800.00 – – – – 800.00 Integrated Flood and Riverbank Erosion Risk Management – Assam (Phase 2): Processing and Institutional Strengthening PP AG 150.00 – – – 750.00 MDTF-WFPF 900.00 Capacity Building for Reforming the Khadi and Village Industry Subsector AD IN – 2,000.00 – – – 2,000.00 Promoting Inclusive Urban Development in Indian Cities AD MS 1,000.00 – – – – 1,000.00 Public–Private Partnerships Pilot Projects Initiative (Mainstreaming Public–Private Partnerships) PP MS – 2,000.00 – – – 2,000.00 Facilitating the Operations of the Energy Conservation Fund “Energy Smart” in Madhya Pradesh AD EN – – – – 1,700.00 DEN-E2 1,700.00 Capacity Building for Himachal Pradesh Power Sector Agencies AD EN 900.00 – – – – 900.00 Capacity Development Programs for Executing Agency Staff of India Projects AD MS 225.00 – – – – 225.00 Agribusiness Infrastructure Development Investment Program (Phase 2) PP AG 1,000.00 – – – – 1,000.00 Bihar State Highways II PP TC 700.00 – – – – 700.00 Dedicated Freight Corridor PP TC – 1,500.00 – – – 1,500.00 Preparing Nonsovereign Urban Infrastructure Projects PP MS 250.00 1,000.00 – – – 1,250.00

Subtotal 14,165.00 9,800.00 – – 3,450.00 27,415.00

Indonesia Integrated Citarum Water Resources Management (Supplementary) PP AG – – – – 200.00 GEF 200.00 Metropolitan Sanitation Management and Health (Supplementary) PP WS – – – – 500.00 MDTF-WFPF 500.00 Enhance Continuing Skills Development AD ED 500.00 – – – – 500.00 Regional Roads Development PP TC – 1,300.00 – – – 1,300.00 Strengthening Environmental Practices for Road Network Development in Kalimantan AD TC 150.00 – – – – 150.00 Local Government Finance and Governance Reform AD LW 1,500.00 – – – – 1,500.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; DEN-E2 = Second Danish Cooperation Fund for Renewable Energy and Energy Efficiency in Rural Areas; ED = education; EN = energy; GEF = Global Environment Facility; IN = industry and trade; JSF = Japan Special Fund; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Institutional Strengthening for Integrated Water Resources Management in the 6 Cis MDTF- River Basin Territory AD MS 1,000.00 – – – 7,000.00 WFPF/The 8,000.00 Netherlands Social Security Reform and Economic Modeling Capacity Building AD MS 800.00 – – – – 800.00

Subtotal 3,950.00 1,300.00 – – 7,700.00 12,950.00

Kazakhstan CAREC Transport Corridor I (Zhambyl Oblast Section) PP TC 150.00 – – – – 150.00 CAREC Transport Corridor I (Zhambyl Oblast Section) (Supplementary) PP TC 150.00 – – – – 150.00

Subtotal 300.00 – – – – 300.00

Kiribati Economic Management and Public Sector Reform AD LW – 800.00 – – – 800.00

Subtotal – 800.00 – – – 800.00

Kyrgyz Republic CAREC Transport Corridor I (Bishkek–Torugart Road) PP TC 150.00 – – – – 150.00 Investment Climate Improvement Program PP MS 500.00 – – – – 500.00 Implementation Support for Investment Climate Reform PP MS 600.00 – – – – 600.00

Subtotal 1,250.00 – – – – 1,250.00

Lao People’s Democratic Republic Sector-Wide Approach in Education Sector Development (Supplementary) AD ED – – – – 477.00 Australia 477.00 Agriculture and Natural Resources Sector Needs Assessment (Supplementary) AD AG 245.00 – – – – 245.00 Piloting Community e-Centers for Better Health AD HL – – – – 500.00 EAKPF 500.00 Strengthening Public Financial Management AD LW 1,100.00 – – – – 1,100.00 Greater Mekong Subregion Nam Theun 2 Hydroelectric Project – Social Safeguards Monitoring AD EN 400.00 – – – – 400.00 Strengthening Higher Education PP ED – 600.00 – – – 600.00 Health Sector Development Program PP HL 500.00 – – – – 500.00 Building Lao PDR’s Capacity to Develop Special Economic Zones AD LW 700.00 – – – – 700.00 Capacity Strengthening for Enhancing Aid Effectiveness AD LW 600.00 – – – – 600.00

Subtotal 3,545.00 600.00 – – 977.00 5,122.00

Micronesia, Federated States of Strengthening Public Sector Performance AD LW – 750.00 – – – 750.00

Subtotal – 750.00 – – – 750.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CAREC = Central Asia Regional Economic Cooperation; CCF = Climate Change Fund; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; ED = education; EN = energy; HL = health, nutrition, and social protection; JSF = Japan Special Fund; Lao PDR = Lao People’s Democratic Republic; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications.


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Mongolia Regional Logistics Development PP TC 400.00 – – – – 400.00 Capital Markets Development AD FI 500.00 – – – – 500.00 Agricultural Marketing and Brand Development AD AG – 2,000.00 – – – 2,000.00 Urban Transport Development PP TC – 1,200.00 – – – 1,200.00 HIV/AIDS Prevention in ADB Infrastructure Projects and the Mining Sector AD HL – – – – 1,000.00 HIV 1,000.00 Southeast Gobi Urban and Border Town Development PP WS 400.00 – – – – 400.00

Subtotal 1,300.00 3,200.00 – – 1,000.00 5,500.00

Nauru Nauru Trust Fund AD FI 225.00 – – – – 225.00

Subtotal 225.00 – – – – 225.00

Nepal Capacity Building in Rural Finance Institutions (Supplementary) AD FI – 600.00 – – – 600.00 Transmission and Distribution Project PP EN 150.00 – – – – 150.00 Knowledge Transfer for Public Procurement AD LW – – – – 500.00 EAKPF 500.00 Enhancing Project Readiness for North-South Fast Track Road Connectivity (PPP) AD TC 225.00 – – – – 225.00 Strengthening Capacity for Managing for Development Results AD LW 500.00 – – – – 500.00 Strengthening Capacity for Macroeconomic Analysis AD LW 675.00 – – – – 675.00 Strengthening Capacity for Managing Climate Change and the Environment AD LW 500.00 – – – – 500.00 Electricity Connectivity and Energy Efficiency I PP EN 150.00 – – – – 150.00 Secondary Towns Integrated Urban Environmental Improvement PP MS – 700.00 – – 146.00 NET-WFPF 846.00 Rural Finance Sector Development Cluster Program (Subprogram II) PP FI 400.00 – – – – 400.00

Subtotal 2,600.00 1,300.00 – – 646.00 4,546.00

Pakistan Sindh Basic Urban Services (Supplementary) PP WS 202.00 – – – 80.00 CFWS 282.00 Competitiveness and Structural Transformation in Pakistan AD LW 350.00 – – – – 350.00 Sustainable Energy Efficiency Development Program PP EN 600.00 – – – – 600.00 Lahore Rapid Mass Transit System PP TC 150.00 – – – – 150.00 Accelerating Economic Transformation Program PP LW 800.00 – – – – 800.00 Sindh Water Resouce Development and Management Investment Program PP AG – 800.00 – – – 800.00 Improving Efficiency and Accountability of North Sindh Urban Services Corporation Limited AD WS 2,500.00 – – – – 2,500.00 Market Infrastructure PP AG – 800.00 – – – 800.00 Supporting the Second Balochistan Resource Management Program PP LW 800.00 – – – – 800.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF =Climate Change Fund; CFWS = Cooperation Fund for the Water Sec-tor; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; EN = energy; FI = finance; HIV = Cooperation Fund for Fighting HIV/AIDS in Asia and the Pacific; HIV/AIDS = human immunodeficiency virus/acquired immunodeficiency syndrome; HL = health, nutrition, and social protection; JSF = Japan Special Fund; LW = law, economic management, and public policy; MS = multisector; NET-WFPF = The Netherlands Trust Fund for the Water Financing Partnership Facility; PP = project preparatory; PPP = public-private partnership; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Improving Private Sector Participation and Public Expenditure Management AD LW 800.00 – – – – 800.00

Subtotal 6,202.00 1,600.00 – – 80.00 7,882.00

Palau, Republic of Development of a Sustainable Health Financing Scheme AD HL – 400.00 – – – 400.00

Subtotal – 400.00 – – – 400.00

Papua New Guinea Power Sector Development PP EN – 1,200.00 – – – 1,200.00 Pilot Border Trade and Investment Development PP IN – 900.00 – – – 900.00 Support for Development Planning AD LW 225.00 – – – – 225.00 National Transport Development Plan (2011–2020) AD TC – 700.00 – – – 700.00

Subtotal 225.00 2,800.00 – – – 3,025.00

Philippines Capacity Building for Housing Microfinance (Supplementary) AD MS – – – – 500.00 EAKPF 500.00 Philippines Basic Urban Services Sector PP MS – 650.00 – – – 650.00 Strengthening Provincial and Local Planning and Expenditure Management Phase 2 AD LW 650.00 – – – – 650.00 Pasuquin East Wind Farm Development PP EN – – – – 200.00 CEF 200.00 Road Sector Improvement PP TC – 660.00 – – – 660.00 Integrated Natural Resources and Environmental Management Sector Development Program PP AG – 850.00 – – – 850.00 Water District Development Sector PP WS – – – – 1,200.00 MDTF-WFPF 1,200.00 Improving Public Expenditure Management AD LW 800.00 – – – – 800.00 Irrigation System Operation Efficiency Improvement PP AG – 1,000.00 – – – 1,000.00 Harmonization and Development Effectiveness AD LW 900.00 – – – – 900.00 Supporting Governance in Justice Sector Reform in the Philippines AD LW 1,500.00 – – – 500.00 GDCF 2,000.00

Subtotal 3,850.00 3,160.00 – – 2,400.00 9,410.00

Samoa Afulilo Environmental Enhancement PP EN – 1,200.00 – – – 1,200.00

Subtotal – 1,200.00 – – – 1,200.00

Solomon Islands Establishment of the Solomon Islands Maritime Safety Administration AD TC 1,000.00 – – – 600.00 EC 1,600.00

Subtotal 1,000.00 – – – 600.00 1,600.00

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; CEF = Clean Energy Fund; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; EC = European Commission; EN = energy; GDCF = Gender and Development Cooperation Fund; HL = health, nutri-tion, and social protection; IN = industry and trade; JSF = Japan Special Fund; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Sri Lanka Independent External Monitoring of Resettlement Activities of the Southern Transport Development Project (Supplementary) AD TC 175.00 – – – – 175.00 Land Use Planning of the Southern Highway Corridor AD TC 300.00 – – – – 300.00 Institutional Strengthening for Decentralized Service Delivery in the Water Sector AD WS 700.00 – – – 50.00 CFWS 750.00 Deepening of Fiscal Management Reforms PP LW – 300.00 – – – 300.00 Assessing Colombo Municipality Wastewater Systems PP WS 150.00 – – – – 150.00 Establishment of a Central Procurement Unit in the Road Development Authority AD TC 225.00 – – – – 225.00

Subtotal 1,550.00 300.00 – – 50.00 1,900.00

Tajikistan Cotton Sector Restructuring (Supplementary) PP AG 240.00 – – – – 240.00 CAREC Transport Corridor III (Dushanbe–Uzbekistan Border Road) PP TC – – 650.00 – – 650.00

Subtotal 240.00 – 650.00 – – 890.00

Thailand Greater Mekong Subregion Highway Expansion PP TC 150.00 – – – – 150.00 Greater Mekong Subregion Highway Expansion (Supplementary) PP TC 120.00 – – – – 120.00 Capital Market Development Phase II AD FI 1,000.00 – – – – 1,000.00 Capacity Building and School Networking for Educational Services (e-Learning) in Thailand AD ED – – – – 500.00 EAKPF 500.00 Mainstreaming Energy Efficiency Measures in Thai Municipalities AD EN – – – – 1,000.00 CEF 1,000.00

Subtotal 1,270.00 – – – 1,500.00 2,770.00

Timor-Leste Road Network Development PP TC – 800.00 – – – 800.00 Capacity Building to Strengthen Public Sector Management and Governance Skills, Phase III AD ED – 500.00 – – – 500.00

Subtotal – 1,300.00 – – – 1,300.00

Tonga Urban Planning and Management System AD MS – 700.00 – – – 700.00

Subtotal – 700.00 – – – 700.00

Tuvalu Capacity Building for Taxation Reforms (Supplementary) AD LW – – – – 270.00 Australia 270.00 Capacity Development for Public Financial Management AD LW 800.00 – – – 57.75 Australia 857.75

Subtotal 800.00 – – – 327.75 1,127.75

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CAREC = Central Asia Regional Economic Cooperation; CCF = Climate Change Fund; CEF = Clean Energy Fund; CFWS = Cooperation Fund for the Water Sector; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; ED = education; EN = energy; FI = finance; JSF = Japan Special Fund; LW = law, economic management, and public policy; MS = multisector; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.


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Uzbekistan Djizzak and Surkhandarya Rural Water Supply and Sanitation Sector (Supplementary) PP WS 200.00 – – – – 200.00 Eligibility of State-Owned Road Enterprises for Participation in ADB-Financed Projects AD TC 150.00 – – – – 150.00 Water Resources Management Sector PP AG – 1,200.00 – – – 1,200.00

Subtotal 350.00 1,200.00 – – – 1,550.00

Viet Nam Support for Public–Private Development of the O Mon Thermal Power Complex (Supplementary) PP EN 740.00 – – – – 740.00 Developing Benefit Sharing Mechanisms for People Adversely Affected by Power Generation Projects (Supplementary) AD EN – – – – 240.00 MDTF-WFPF 240.00 Ho Chi Minh City Metro Rail System (Supplementary) PP TC 500.00 – – – – 500.00 Health Care in the South Central Coast Region (Supplementary) PP HL 500.00 – – – – 500.00 Viet Nam Water Sector Review (Supplementary) AD MS – – – – 550.00 The 550.00 Netherlands Making Markets Work Better for the Poor Phase 2 AD IN 400.00 – – – 8,000.00 United 8,400.00 Kingdom Second Small and Medium-Sized Enterprise Development Program PP LW – 500.00 – – – 500.00 Skills Enhancement PP ED – 600.00 – – – 600.00 Support for Developing Capital Markets and Building Capacity in the Financial Sector AD FI 1,000.00 – – – – 1,000.00 Hue Water Supply PP WS – – – – 1,500.00 NET-WFPF 1,500.00 Ho Chi Minh City Water Supply PP WS – – – – 1,500.00 France 1,500.00 Higher Education Sector Development PP ED – 1,000.00 – – – 1,000.00 Strengthening Water Management and Irrigation Systems Rehabilitation PP AG – 1,000.00 – – – 1,000.00 Supporting Civil Service Reform AD LW 1,000.00 – – – – 1,000.00 Central Region Rural Water Supply and Sanitation Sector PP WS 600.00 – – – – 600.00 Da Nang Water Supply PP WS – – – – 1,500.00 MDTF-WFPF 1,500.00 Hai Phong Water Supply PP WS – – – – 1,000.00 NET-WFPF 1,000.00 Greater Mekong Subregion Ha Noi–Lang Son and Ha Long–Mong Cai Expressway PP TC 1,500.00 – – – – 1,500.00 Ben Luc–Long Thanh Expressway PP TC – 1,500.00 – – – 1,500.00 Geo-Information Technology for Hazard Risk Assessment AD AG – – – – 500.00 EAKPF 500.00 Sustainable Rural Infrastructure Development Project in the Northern Mountain Provinces PP MS – 1,000.00 – – – 1,000.00 Capacity Building of the National Power Transmission Corporation in a Competitive Power Market Environment AD EN 225.00 – – – – 225.00

Subtotal 6,465.00 5,600.00 – – 14,790.00 26,855.00 TOTAL 76,663.00 41,250.00 1,538.00 2,000.00 36,270.75 157,721.75

– = nil or data not applicable; AD = advisory; AG = agriculture and natural resources; CCF = Climate Change Fund; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; ED = education; EN = energy; FI = finance; HL = health, nutrition, and social protection; IN = industry and trade; JSF = Japan Special Fund; LW = law, economic management, and public policy; MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility; MS = multisector; NET-WFPF = The Netherlands Trust Fund for the Water Financing Partnership Facility; PP = project preparatory; RCIF = Regional Cooperation and Integration Fund; TA = technical assistance; TASF = Technical Assistance Special Fund; TC = transport and communications; WS = water supply, sanitation, and waste management.

CONTINUED



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Statistical Annex 18 TECHNICAL ASSISTANCE GRANT APPROVALS BY SECTOR,a, b 1967–2008, 2007, 2008

1967–2008 2007 2008

No. $ thousand % No. $ thousand % No. $ thousand %

Agriculture and Natural Resources 1,099 542,097.02 20.54 18 10,647.00 7.09 21 18,135.00 11.50

Education 299 146,625.72 5.56 5 2,505.00 1.67 10 6,967.00 4.42

Energy 533 264,196.11 10.01 28 21,609.06 14.39 23 16,503.00 10.46

Finance 449 215,405.72 8.16 6 5,530.00 3.68 11 5,525.00 3.50

Health, Nutrition, and Social Protection 183 97,328.42 3.69 9 13,202.52 8.79 9 4,171.00 2.64

Industry and Trade 265 119,130.00 4.51 – – – 3 11,300.00 7.16

Law, Economic Management, and Public Policy 963 498,492.30 18.89 39 39,505.00 26.30 34 24,922.75 15.80

Transport and Communications 669 336,798.30 12.76 26 16,552.85 11.02 40 25,445.00 16.13

Water Supply, Sanitation, and Waste Management 272 134,168.45 5.08 11 10,128.00 6.74 18 15,507.00 9.83

Multisector 358 285,279.65 10.81 18 30,510.00 20.31 28 29,246.00 18.54

TOTAL 5,090 2,639,521.68 100.00 160 150,189.43 100.00 197 157,721.75 100.00

– = nil. a Excludes technical assistance financed under loans that are included in ADB’s loan data and regional activities.b Data are adjusted to exclude technical assistance projects withdrawn by governments.

Statistical Annex 19 CONSULTING SERVICES FINANCED THROUGH LOANS BY SECTOR, 2008 (amounts in $ million)

Sector Loan %

Agriculture and Natural Resources 19.64 8.02

Education 5.34 2.18

Energy 26.69 10.90

Finance – –

Health, Nutrition, and Social Protection 3.55 1.45

Industry and Trade 3.92 1.60

Law, Economic Management, and Public Policy – –

Transport and Communications 117.66 48.06

Water Supply, Sanitation, and Waste Management 11.15 4.55

Multisector 56.87 23.23

TOTAL 244.82 100.00

– = nil.


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Statistical Annex 20 REGIONAL TECHNICAL ASSISTANCE ACTIVITIES, 2008 ($ thousand)

TASF JSF RCIF CCF Others Source Total

CONFERENCE Supporting the Boao Forum for Asia – – – – 500.00 PRC RPRF 500.00 Supporting Regional Capacities for Financial Asset and Liability and Risk Management – – 320.00 – – 320.00 Supporting the Third High–Level Forum on Aid Effectiveness and its Preparatory Consultation Process 500.00 – – – – 500.00 Natural Catastrophe Risk Insurance Mechanisms for the Asia and Pacific Region – 800.00 – – – 800.00 South Asian Bond Markets Conference 66.00 – – – – 66.00 South Asia Forum on the Impact of Global Economic and Financial Crisis 800.00 – – – – 800.00 Public Debt and Risk Management Forum 650.00 – – – – 650.00 Strengthening Capacity of the Developing Member Countries for Managing Credit Enhancement Products 500.00 – – – – 500.00

Subtotal 2,516.00 800.00 320.00 – 500.00 4,136.00 RESEARCH Establishment of Regional Knowledge Hubs (Supplementary) 150.00 – – – – 150.00 Bond Financing for Infrastructure Projects in the ASEAN+3 Region – 700.00 – – – 700.00 Developing Securitization Markets in ASEAN+3 – 700.00 – – – 700.00 Strategic Partnerships for Policy Development and Action to Foster Regional Cooperation in South Asia – – 700.00 – – 700.00 Promoting Energy Efficiency in the Pacific – – – – 1,200.00 CEF 1,200.00 Asian Development Outlook 2009 460.00 – – – – 460.00 Knowledge Sharing on Infrastructure Public-Private Partnerships in Asia – – – – 500.00 EAKPF 500.00 Quantifying the Costs and Benefits of Regional Economic Integration in Asia 910.00 – – – – 910.00 Minimizing Foreign Exchange Settlement Risk in the ASEAN+3 Region: Support for Group of Experts – – – – 850.00 ICFF 850.00 Enterprise Development and the Challenge of Inclusive Growth 500.00 – – – – 500.00

Subtotal 2,020.00 1,400.00 700.00 – 2,550.00 6,670.00 STUDY Central Asia Regional Economic Cooperation: Transport Sector Strategy Study (Supplementary) 325.00 – – – – 325.00 Enhancing Effective Regulation of Water and Energy Infrastructure and Utility Services (Supplementary) – – – – 700.00 Australia 700.00 A Development Framework for Sustainable Urban Transport (Supplementary) – – – – 220.00 United 220.00 Kingdom Development Study of GMS Economic Corridors (Supplementary) 200.00 – – – 400.00 PRC RPRF 600.00 Managing the Cities in Asia (Supplementary) – – – – 2,000.00 Spain 2,000.00

– = nil or data not applicable; ASEAN+3 = Association of Southeast Asian Nations, plus the People’s Republic of China, Japan, and Republic of Korea; CCF = Climate Change Fund; CEF = Clean Energy Fund; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; GMS = Greater Mekong Subregion; ICFF = Investment Climate Facilitation Fund; JSF = Japan Special Fund; PRC RPRF = People’s Republic of China Regional Cooperation and Poverty Reduction Fund; RCIF = Regional Cooperation and Integration Fund; TASF = Technical Assistance Special Fund.


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ASEAN+3 Regional Guarantee and Investment Mechanism Phase 2 (Supplementary) 400.00 – – – – 400.00 Improving the Implementation of Environmental Safeguards for ADB Projects in Central and West Asia 150.00 – – – – 150.00 Equity in the Delivery of Public Services in Selected Developing Member Countries 500.00 – – – – 500.00 Strengthening Pacific Economic Analysis and Policy Development 1,500.00 – – – 400.00 Australia 1,900.00 Selected Evaluation Studies for 2008 1,493.00 – – – – 1,493.00 Managing Water in Asia’s River Basins: Charting Progress and Facilitating Investment – 2,000.00 – – – 2,000.00 Strengthening Coastal and Marine Resources Management in the Coral Triangle of the Pacific (Phase 1) – – – – 850.00 Finland/ 850.00 GEF South Asian Regional Cooperation in 2030: The Potential Role of India and Pakistan – – 750.00 – – 750.00 Preparing a Response in the Pacific to High Prices 225.00 – – – – 225.00 Addressing Climate Change in the Asia and Pacific Region 1,250.00 – – – – 1,250.00 Improving Price Collection of Non–Household Expenditure Components and Updating Purchasing Power Parity Estimates for Selected Developing Member Countries 600.00 – – – – 600.00 Adopting the Supply and Use Framework Towards 1993 System of National Accounts Compliance in Selected Developing Member Countries 800.00 – – – – 800.00 Developing a Computable General Equilibrium Modeling Framework for Analyzing the Impacts of Power Trading Between Mongolia and the People’s Republic of China – – – – 150.00 PRC RPRF 150.00 Harmonization of Bond Standards in ASEAN+3 – – – – 950.00 EAKPF/ICFF 950.00 Attracting and Managing Foreign Direct Investments in the Transitional Economies of Southeast Asia 225.00 – – – – 225.00 Macroprudential Framework for the Early Detection of Financial Vulnerabilities 225.00 – – – – 225.00

Subtotal 7,893.00 2,000.00 750.00 – 5,670.00 16,313.00

TRAINING Greater Mekong Subregion Phnom Penh Plan for Development Management III (Supplementary) – – – – 900.00 PRC RPRF/ 900.00 New Zealand Strengthening Pro-Poor Policy in the Pacific (Supplementary) 24.00 – – – 232.00 Australia 256.00 Anticorruption Seminars, 2008–2009 450.00 – – – – 450.00 Enhancing Collaboration with Supreme Audit Institutions through Project Procurement– Related Audits 140.00 – – – – 140.00 Capacity Building and Institutional Strengthening of the Free Trade Agreement Units of Selected ASEAN Member Countries – – – – 500.00 PRC RPRF 500.00


– = nil or data not applicable; ASEAN = Association of Southeast Asian Nations; ASEAN+3 = Association of Southeast Asian Nations, plus the People’s Republic of China, Japan, and Republic of Korea; CCF = Climate Change Fund; EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund; GEF = Global Environment Facility; ICFF = Investment Climate Facilitation Fund; JSF = Japan Special Fund; PRC RPRF = People’s Republic of China Regional Cooperation and Poverty Reduction Fund; RCIF = Regional Cooperation and Integration Fund; TASF = Technical Assistance Special Fund.


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Capacity Building for Bond Market Development in ASEAN+3 – – 500.00 – – 500.00 Strengthening the Asian Ombudsman Association 900.00 – – – – 900.00 Pacific Financial Technical Assistance Centre 2008–2011 1,000.00 – – – – 1,000.00 Strengthening Governance and Accountability in Pacific Island Countries (Phase 2) – 1,500.00 – – 400.00 Australia 1,900.00 Targeted Capacity Building for Mainstreaming Indigenous Peoples Concerns in Development 600.00 – – – – 600.00 Promoting South Asian Regional Economic Cooperation II 1,500.00 – – – – 1,500.00

Subtotal 4,614.00 1,500.00 500.00 – 2,032.00 8,646.00 OTHERS Core Environment Program and Biodiversity Conservation Corridors Initiative in the Greater Mekong Subregion (Supplementary) 400.00 – – – 6,200.00 PRC RPRF/ 6,600.00 Finland/The Netherlands Development Partnership Program for South Asia (Supplementary) – – – – 588.00 Norway/ 588.00 Sweden Strengthening Country Safeguard Systems (Supplementary) 597.97 – – – – 597.97 Enhancing Gender and Development Capacity in Developing Member Countries – Phase 2 (Supplementary) – – – – 1,000.00 GDCF 1,000.00 Promoting Gender Equality and Women’s Empowerment (Supplementary) – – – – 1,000.00 GDCF 1,000.00 Fighting HIV/AIDS in Asia and the Pacific (Supplementary) – – – – 1,300.00 HIV 1,300.00 Enhancement of Subregional Cooperation in BIMP–EAGA and IMT–GT (Supplementary) 121.00 – – – – 121.00 Energy Sector Strategy and Development 2007 (Supplementary) 1,000.00 – – – – 1,000.00 Private Sector Development Initiative (Supplementary) – – – – 300.00 Australia 300.00 Mainstreaming Environment for Poverty Reduction (Supplementary) – – – – 2,600.00 Poverty and 2,600.00 Environment Fund Rolling Out Air Quality Management in Asia (Supplementary) – – – – 484.63 Sweden 484.63 Promoting Effective Water Management Policies and Practices – Phase 5 (Supplementary) – – – – 1,219.00 CFWS 1,219.00 Promoting South Asian Regional Economic Cooperation (Supplementary) 80.00 – – – – 80.00 Implementation of the Seed Capital Assistance Facility – – – – 4,200.00 GEF 4,200.00 Energy for All Initiative – – – – 2,300.00 The 2,300.00 Netherlands


CONTINUED

– = nil or data not applicable; ASEAN = Association of Southeast Asian Nations; ASEAN+3 = Association of Southeast Asian Nations, plus the People’s Republic of China, Japan, and Republic of Korea; BIMP-EAGA = Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area; CCF = Climate Change Fund; CFWS = Cooperation Fund for the Water Sector; GDCF = Gender and Development Cooperation Fund; GEF = Global Environment Facility; HIV = Cooperation Fund for Fighting HIV/AIDS in Asia and the Pacific; HIV/AIDS = human immunodeficiency virus/acquired immunodeficiency syndrome; IMT-GT = Indonesia-Malaysia-Thailand Growth Triangle; JSF = Japan Special Fund; PRC RPRF = People’s Republic of China Regional Cooperation and Poverty Reduction Fund; RCIF = Regional Cooperation and Integration Fund; TASF = Technical Assistance Special Fund.


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Support for Implementation of the Second Governance and Anticorruption Action Plan – – – – 2,600.00 GCF 2,600.00 Strengthening Sound Environmental Management in the Brunei Darussalam, Indonesia, Malaysia, and Philippines East ASEAN Growth Area 1,500.00 – – – – 1,500.00 Strengthening Sound Environmental Management in the Brunei Darussalam, Indonesia, Malaysia, and Philippines East ASEAN Growth Area (Supplementary) – – – – 500.00 GEF 500.00 Integrating Human Trafficking and Safe Migration Concerns for Women and Children into Regional Cooperation – – 1,000.00 – – 1,000.00 Enhancing Transport and Trade Facilitation in the Greater Mekong Subregion – – 1,000.00 – 750.00 Australia/ 1,750.00 PRC RPRF Pyanj River Basin Flood Management 1,600.00 – – – – 1,600.00 Greater Mekong Subregion Flood and Drought Risk Management and Mitigation – 2,000.00 – – – 2,000.00 Comprehensive Midterm Review of the Brunei Darussalam–Indonesia–Malaysia–Philippines East ASEAN Growth Area Road Map to Development 300.00 – – – – 300.00 Asia Regional Integration Center, Phase II 900.00 – – – – 900.00 Institutional Development for Enhanced Subregional Cooperation in the aSEA Region 3,800.00 – – – – 3,800.00 Asian Bonds Online Website Project, Phase II – 900.00 – – – 900.00 HIV Prevention and Infrastructure: Mitigating Risk in the Greater Mekong Subregion – – – – 6,000.00 Australia 6,000.00 Strengthening Southeast Asian Financial Markets – – 650.00 – – 650.00 Enhancing Engagement with Pacific Developing Member Countries 1,500.00 – – – – 1,500.00 Second Northern Greater Mekong Subregion Transport Network Improvement – 1,300.00 – – – 1,300.00 Enhancing Social Protection Initiatives in Developing Member Countries 1,000.00 – – – – 1,000.00 Ban Sok–Pleiku Power Transmission Project in the Greater Mekong Subregion – 1,000.00 – – – 1,000.00 Mekong Water Supply and Sanitation – 400.00 500.00 – 300.00 NET-WFPF 1,200.00 Improved Management of Water Resources in Central Asia – – – – 998.00 MDTF-WFPF 998.00 Central Asia Regional Economic Cooperation Institute, 2009–2012 4,000.00 – 500.00 – 500.00 PRC RPRF 5,000.00 Thirteenth Agriculture and Natural Resources Research at International Agricultural Research Centers 3,000.00 – – – – 3,000.00 Assessing the Socioeconomic Effects of the Greater Mekong Subregion Projects 950.00 – – – – 950.00 Gender-Responsive Decentralized Governance in Asia 500.00 – – – – 500.00 Strengthening Evidence-Based Policy-Making in the Pacific: Support for Development of National Health Accounts – 1,000.00 – – – 1,000.00 Regional Partnerships for Climate Change Adaptation and Disaster Preparedness – – 1,000.00 – – 1,000.00 Capacity Building for Regional Trade Integration and Facilitation – 900.00 – – – 900.00


– = nil or data not applicable, aSEA = archipelagic Southeast Asia, ASEAN = Association of Souteast Asian Nations, CCF = Climate Change Fund, GCF = Governance Coperation Fund, GGEF = Global Environment Facility, HIV = human immunodeficiency virus, JSF = Japan Special Fund, MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility, NET-WFPF = The Netherlands Trust Fund for the Water Financing Partnership Facility, PRC RPRF = People’s Republic of China Regional Cooperation and Poverty Reduction Fund, RCIF = Regional Cooperation and Integration Fund, TASF = Technical Assistance Special Fund.


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Knowledge and Innovation Support for ADB’s – – – – 2,000.00 NET-WFPF/ 2,000.00 Water Financing Program MDTF-WFPF Expanding the Implementation of the Energy Efficiency Initiative in Developing Member Countries – – – 3,000.00 – 3,000.00 Regional Knowledge and Partnership Networks for Poverty Reduction and Inclusive Growth – – – – 1,000.00 EAKPF/ 1,000.00 PRC RPRF Capturing and Transferring Air Quality Management Knowledge in Asia – 500.00 – – – 500.00 Improving Connectivity and Destination Management of Cultural and Natural Resources in the South Asia Subregion – – 2,000.00 – – 2,000.00 Enhancing Financial Disclosure Standards in Armenia, Azerbaijan, and Georgia – – – – 600.00 ICFF 600.00 Strengthening Public Financial Management in Pacific Developing Member Countries 1,500.00 – – – – 1,500.00 Regional Stocktaking and Mapping of Disaster Risk Reduction Interventions for Asia and the Pacific 400.00 – – – – 400.00 Rural Information and Communication Technology Policy Advocacy, Knowledge Sharing, and Capacity Building – – – – 500.00 EAKPF 500.00 Impact of Maternal and Child Health Private Expenditure on Poverty and Inequity 300.00 – – – 326.00 Australia 626.00 Promoting Inclusive Growth through Business Development at the Base of the Pyramid 650.00 – – – – 650.00 Accelerating the Implementation of the Core Agriculture Support Program 1,500.00 – – – 500.00 PRC RPRF 2,000.00

Subtotal 25,598.97 8,000.00 6,650.00 3,000.00 37,765.63 81,014.60 TOTAL 42,641.97 13,700.00 8,920.00 3,000.00 48,517.63 116,779.60 – = nil or data not applicable, CCF = Climate Change Fund, EAKPF = Republic of Korea e-Asia and Knowledge Partnership Fund, ICFF = Investment Climate Facilitation Fund, JSF = Japan Special Fund, MDTF-WFPF = Multidonor Trust Fund under the Water Financing Partnership Facility, NET-WFPF = The Netherlands Trust Fund for the Water Financing Partnership Facility, PRC RPRF = People’s Republic of China Regional Cooperation and Poverty Reduction Fund, RCIF = Regional Cooperation and Integration Fund, TASF = Technical Assistance Special Fund.


CONTINUED


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Statistical Annex 21 NET TRANSFER OF RESOURCES (ORDINARY CAPITAL RESOURCES AND ASIAN DEVELOPMENT FUND),a, b 2006–2008 ($ million)

OCR ADF

2006 2007 2008 2006 2007 2008

Afghanistan 9.54 4.92 8.37 63.62 91.08 46.78 Armenia – – – – – 8.03 Azerbaijan 3.92 42.35 2.87 4.03 12.98 8.62 Bangladesh 53.00 20.07 87.47 53.64 79.19 237.99

Bhutan (1.90) – – 2.37 6.43 0.87 Cambodia – – 6.95 45.06 45.65 89.16 China, People’s Republic of 517.25 607.60 703.60 – – –

Cook Islands – – – (0.34) (0.72) 0.40 Fiji Islands 2.62 1.89 1.69 – – – Georgia – 24.75 (1.76) – – 69.86 Hong Kong, China – – – – – –

India 264.28 1,154.77 1,246.38 – – – Indonesia 12.15 156.68 (69.88) 67.44 91.50 13.37 Kazakhstan 118.29 35.15 (47.04) (1.51) (49.32) (0.26)

Kiribati – – – (0.10) (0.25) (0.29)Korea, Republic of (19.32) (20.47) (26.23) – – – Kyrgyz Republic – – – 35.76 21.35 11.19

Lao People’s Democratic Republic 11.49 14.77 0.72 49.21 47.60 13.86 Malaysia (66.85) (37.11) (51.10) – – – Maldives – 1.46 (0.18) 3.63 3.72 0.56

Marshall Islands (0.22) (0.68) (0.47) (0.51) (2.17) (1.24)Micronesia, Federated States of – – 0.05 1.94 2.83 2.22 Mongolia (5.00) (0.68) 7.17 18.36 12.02 8.97

Myanmar – – – – – – Nauru – – (2.32) – – – Nepal (5.99) (6.11) (11.93) 62.45 43.98 (2.40)

Pakistan 404.94 345.29 1,037.63 56.07 228.84 377.72 Papua New Guinea (38.76) (30.21) (2.62) 3.31 (5.92) (10.90)Philippines 302.15 80.96 237.15 (33.70) (35.08) (42.14)

Samoa – – – (1.99) (2.47) (1.81)Singapore – – – – – – Solomon Islands – – – 2.35 1.70 (2.23)

Sri Lanka 6.99 (15.54) 67.38 66.39 58.07 52.24 Taipei,China – – – – – – Tajikistan – – – 34.05 36.80 46.87

Thailand (117.43) (50.87) (13.56) (3.35) (4.19) (4.63)Timor-Leste – – – – – –Tonga – – – (1.46) (1.55) (1.63)

Turkmenistan – – – – – – Tuvalu – – – 1.14 1.07 0.28 Uzbekistan 27.59 12.81 7.01 (0.05) (0.03) 2.51

Vanuatu – – – (1.08) (1.28) (1.74)Viet Nam (7.31) 27.55 (14.34) 139.44 138.85 187.03 Regional 14.20 7.71 17.63 0.15 0.31 0.55

TOTALc 1,485.65 2,377.04 3,190.63 666.33 820.98 1,109.79

– = nil, ( ) = negative, ADF = Asian Development Fund, OCR = ordinary capital resources. a Net transfer of resources for OCR defined as loan disbursements less principal repayments/prepayments and interest/charges received. Includes nonsovereign loans

and net equity investments. b Net transfer of resources for ADF defined as loan disbursements less principal repayments and interest/charges received. c Totals may not add up because of rounding.


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Statistical Annex 22 NET TRANSFER OF RESOURCES (ORDINARY CAPITAL RESOURCES AND ASIAN DEVELOPMENT FUND),a 1999–2008 ($ million)

1999–2003 Average 2004 2005 2006 2007 2008

Afghanistan 27.51 42.13 54.17 73.16 96.00 55.15 Armenia – – – – – 8.03 Azerbaijan – – 0.50 7.95 55.33 11.49 Bangladesh 117.84 19.54 81.17 106.64 99.26 325.46

Bhutan 5.79 5.28 10.34 0.47 6.43 0.87 Cambodia 53.07 70.87 76.73 45.06 45.65 96.11 China, People’s Republic of (164.87) 0.49 544.64 517.25 607.60 703.60

Cook Islands 0.10 1.14 0.53 (0.34) (0.72) 0.40 Fiji Islands (2.62) 4.11 8.30 2.62 1.89 1.69 Georgia – – – – 24.75 68.10 Hong Kong, China – – – – – –

India (291.90) (1,036.01) 457.20 264.28 1,154.77 1,246.38 Indonesia 75.35 (253.74) 142.80 79.59 248.18 (56.51)Kazakhstan (12.25) (85.45) (153.85) 116.78 (14.17) (47.30)

Kiribati 1.04 2.32 1.36 (0.10) (0.25) (0.29)Korea, Republic of (621.21) (66.84) (1,756.33) (19.32) (20.47) (26.23)Kyrgyz Republic 39.80 50.36 25.10 35.76 21.35 11.19

Lao People’s Democratic Republic 38.61 31.00 72.84 60.70 62.37 14.58 Malaysia (47.15) (59.48) (52.99) (66.85) (37.11) (51.10)Maldives 2.47 0.94 3.66 3.63 5.18 0.38

Marshall Islands 6.55 0.40 (0.26) (0.73) (2.85) (1.71)Micronesia, Federated States of 2.93 0.63 1.24 1.94 2.83 2.27 Mongolia 31.81 38.54 20.56 13.36 11.34 16.14

Myanmar (0.30) – – – – – Nauru 0.42 – – – – (2.32)Nepal 25.65 (23.35) (2.79) 56.46 37.87 (14.33)

Pakistan 43.79 (862.98) 242.91 461.01 574.13 1,415.35 Papua New Guinea (6.66) (14.67) (9.52) (35.45) (36.13) (13.52)Philippines (160.89) (218.54) (118.94) 268.45 45.88 195.01

Samoa (0.91) (0.17) (0.35) (1.99) (2.47) (1.81)Singapore – – – – – – Solomon Islands (1.04) (0.71) 1.16 2.35 1.70 (2.23)

Sri Lanka 94.77 116.30 122.70 73.38 42.53 119.62 Taipei,China – – – – – – Tajikistan 10.56 19.00 25.22 34.05 36.80 46.87

Thailand (426.45) (102.22) (394.42) (120.78) (55.06) (18.19)Timor-Leste – – – – – – Tonga 2.45 (1.26) (1.37) (1.46) (1.55) (1.63)

Turkmenistan – – – – – – Tuvalu 0.79 0.01 0.06 1.14 1.07 0.28 Uzbekistan 30.26 70.82 69.49 27.54 12.78 9.52

Vanuatu 3.37 (0.92) (0.93) (1.08) (1.28) (1.74)Viet Nam 216.88 167.59 181.62 132.13 166.40 172.69 Regional 1.63 (6.32) (27.65) 14.35 8.02 18.18

TOTALb (902.80) (2,091.19) (375.08) 2,151.98 3,198.02 4,300.42

– = nil, ( ) = negative.a Net transfer of resources defined as loan disbursements less principal repayments/prepayments and interest/charges received. Includes private sector loans and net

equity investments.b Totals may not add up because of rounding.


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Statistical Annex 23 ASIAN DEVELOPMENT FUND RESOURCES AND COMMITMENT AUTHORITY

ADF-CONTRIBUTED RESOURCES ($ million; as of 31 December 2008) Change in 2008

Valued as of Exchange Rate Net Valued as of 31 December 2007 Addition Adjustment Change 31 December 2008 ($ equivalent) ($ equivalent) ($ equivalent) ($ equivalent) ($ equivalent) (SDR equivalenta)

Australia 1,608.81 66.08 (357.40) (291.32) 1,317.49 851.20Austria 263.21 2.34 (12.06) (9.72) 253.49 163.77Belgium 237.41 7.04 (11.51) (4.47) 232.94 150.50Brunei – 9.50 – 9.50 9.50 6.14Canada 1,956.37 50.47 (386.18) (335.71) 1,620.66 1,047.06China, People’s Republic of 21.00 7.00 – 7.00 28.00 18.09Denmark 267.76 9.54 (13.04) (3.50) 264.26 170.73Finland 148.61 5.33 (7.30) (1.97) 146.64 94.74France 1,370.27 48.90 (59.81) (10.91) 1,359.36 878.25Germany 2,009.17 14.41 (91.84) (77.43) 1,931.74 1,248.05Hong Kong, China 49.98 4.48 – 4.48 54.46 35.18Indonesia 14.96 0.00 – – 14.96 9.67Ireland 25.51 9.10 (2.14) 6.96 32.47 20.98Italy 841.34 122.57 (48.28) 74.29 915.63 591.56Japan 12,414.47 299.40 3,046.02 3,345.42 15,759.89 10,182.05Korea, Republic of 267.95 29.88 (80.24) (50.36) 217.59 140.58Luxembourg 49.08 1.02 (2.28) (1.26) 47.82 30.89Malaysia 11.69 1.41 (0.67) 0.74 12.43 8.03Nauru 1.93 0.00 – – 1.93 1.25The Netherlands 808.74 29.78 (40.17) (10.39) 798.35 515.79New Zealand 127.80 4.96 (32.43) (27.47) 100.33 64.82Norway 227.65 10.63 (54.84) (44.21) 183.44 118.52Portugal 92.46 6.14 (4.89) 1.25 93.71 60.54Singapore 7.97 1.17 (0.01) 1.16 9.13 5.90Spain 379.13 18.84 (18.76) 0.08 379.21 245.00Sweden 325.34 14.30 (60.45) (46.15) 279.19 180.38Switzerland 407.56 12.13 24.87 37.00 444.56 287.22Taipei,China 55.83 5.16 – 5.16 60.99 39.40Thailand 9.52 0.84 (1.34) (0.50) 9.02 5.83Turkey 107.63 0.36 – 0.36 108.00 69.77United Kingdom 1,149.60 52.20 (333.78) (281.58) 868.02 560.80United States 3,419.61 69.58 – 69.58 3,489.20 2,254.28

TOTAL 28,678.39 914.54 1,451.48 2,366.02 31,044.41 20,056.97

ADF COMMITMENT AUTHORITY ($ million; as of 31 December 2008)

2007 2008

Carryover from ADF VIII Commitment Authorityb 126.89 124.43 ADF IX Contributionsc 2,144.38 2,976.46 ADF VIII Contributions 164.58 161.62 OCR Net Income Transfer 120.00 160.00 Expanded Advance Commitment Authority 2,979.70 3,895.73 Loan Savings and Cancellations 890.82 1,133.27 Credits from Accelerated Note Encashment Program – 62.97 Less: Provision for Disbursement Riskd 157.88 158.42 Provision for Foreign Exchange Volatilitye – 15.23 Total ADF IX Commitment Authority 6,268.49 8,371.29 Less: Loans and Grants Committedf 5,833.10 8,248.68

ADF Commitment Authority Available for Future Commitments 435.39 122.61

– = data not applicable, ADF = Asian Development Fund, OCR = ordinary capital resources. Note: Totals may not add up because of rounding.a Refers to the special drawing rights (SDR) equivalent of the US dollar amount valued at the rate of $1.547810 per SDR as of 31 December 2008.b The US dollar equivalent of SDR80.39 million at each year-end exchange rates.c Contributions received to finance forgone interest of grants are excluded as they have been incorporated in the computation of the Expanded Advance Commitment

Authority.d Applies to contribution and net income transfer received prior to the adoption of the new ADF Financial Framework approved in December 2007.e Represents an allowance to cover the shortfall in the commitment authority due to exchange rate fluctuation during the last 3 months of 2008. f Loans and grants approved from 1 January 2005 to 31 December 2008.


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Statistical Annex 24 TECHNICAL ASSISTANCE SPECIAL FUND ($ thousand; as of 31 December 2008)

Total Amount Contributions Utilized

Direct Voluntary Contributions Australia 2,484 2,484 Austria 159 159 Bangladesh 47 47

Belgium 1,394 1,394 Canada 3,346 3,346 China, People’s Republic of 1,600 1,600

Denmark 1,963 1,963 Finland 237 237 France 1,698 1,698

Germany 3,315 3,315 Hong Kong, China 100 100 India 3,310 3,310

Indonesia 250 250 Italy 774 774 Japan 47,710 47,710

Korea, Republic of 1,900 1,900 Malaysia 909 909 The Netherlands 1,338 1,338

New Zealand 1,096 1,096 Norway 3,279 3,279 Pakistan 1,736 1,736

Singapore 1,100 1,100 Spain 190 190 Sri Lanka 6 6

Sweden 861 861 Switzerland 1,035 1,035 Taipei,China 200 200

United Kingdom 5,617 5,617 United States 1,500 1,500

Subtotal 89,154 89,154

Regularized Replenishment Contributionsa 432,617 415,934

Transfer to Asian Development Fund (3,472) (3,472)

Allocation from OCR Net Incomeb 884,257 798,234

Subtotal 1,313,402 1,210,696

TOTAL 1,402,556 1,299,850

( ) = negative, OCR = ordinary capital resources. a Represents Technical Assistance Special Fund (TASF) portion of contributions to the replenishment of the Asian Development Fund and the TASF authorized by

Board of Governors’ Resolutions 182, 214, and 300 at historical values. b Includes income, repayments, and reimbursements to the TASF since 1980, including investment holding gains (losses).


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Statistical Annex 25 JAPAN SPECIAL FUND—Regular and Supplementary Contributions Statement of Activities and Change in Net Assets ($ million)

1988–2002a 2003 2004 2005 2006 2007 2008 Total

Contributions Committed 836.0 16.6 24.2 27.3 24.5 27.7 17.4 973.7 Revenue 129.0 3.3 4.3 7.1 10.7 12.0 6.6 173.0

Total 965.0 19.9 28.5 34.4 35.2 39.7 24.0 1,146.7

Transfer to Cooperation Fund for Regional Trade and Financial Security Initiative – – (1.0) – – – – (1.0)Expenses 767.2 39.6 19.7 35.9 51.1 33.7 55.1 1,002.3 Exchange Gain (Loss) (25.2) (0.3) 1.2 (0.8) (0.1) – 0.2 (25.0)Translation Adjustments (12.5) – – – – – – (12.5)

Change in Net Assets 160.1 (20.0) 9.0 (2.3) (16.0) 6.0 (30.9) 105.9

– = nil, ( ) = negative.a Prior years’ amounts have been restated to conform with the 1995 presentation.

Statistical Annex 26 JAPAN SPECIAL FUND—Asian Currency Crisis Support Facility Statement of Activities and Change in Net Assets ($ million)

1999–2003 2004 2005 2006 2007 2008 Total

Contributions Committed 241.0a – – – – – 241.0 Revenue 2.8 0.5 1.1 1.7 1.8 1.1 9.0

Total 243.8 0.5 1.1 1.7 1.8 1.1 250.0

Transfer to Japan Fund for Poverty Reduction (90.0) – – – – – (90.0)Interest Payment Assistance Written Back 33.2 – – – – – 33.2 Expenses 131.5 (0.9) (0.8) (0.4) – (0.4) 129.0 Exchange Gain (Loss) (1.7) – – – – – (1.7)Translation Adjustments (26.3) – – – – – (26.3)

Change in Net Assets 27.5 1.4 1.9 2.1 1.8 1.5 36.2

– = nil, ( ) = negative. a A guarantee facility is provided under the Asian Currency Crisis Support Facility for which the Government of Japan has made available noninterest-bearing, non-

negotiable notes in the amount of 360 billion yen, encashable by ADB at any time to meet a call on any guarantee. In the absence of any concluded guarantee, the note was returned to the Government of Japan on 25 March 2002.


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Statistical Annex 27 JAPAN FUND FOR POVERTY REDUCTION, 2008

Amount Project Name ($ thousand)

Afghanistan Development of Mini Hydropower Plants in Badakhshan and Bamyan Provinces 12,000 Lao People’s Democratic Republic Alternative Livelihood for Upland Ethnic Groups in Houaphanh Province 1,820 Micronesia, Federated States of Weno Water Supply Well Remediation 980 Mongolia Energy Conservation and Emissions Reduction from Poor Households 2,000 Poverty Reduction through Community-Based Natural Resource Management 2,000 Water Point and Extension Station Establishment for Poor Herding Families 2,000 Community-Based Local Road Upgrading and Maintenance in the Western Region of Mongolia 2,000 Philippines Developing Microinsurance 1,000 Sri Lanka Improvement of Rural Access Roads and Livelihood Development for the Poor 2,000 Tajikistan Community Participatory Flood Management 3,000 Viet Nam Demand–Driven Skills Training for Poverty Reduction in the Cuu Long (Mekong) River Delta 1,300 Livelihood Improvement of Vulnerable Ethnic Minority Communities Affected by the Song Bung 4 Hydropower Project in Quang Nam Province 2,000 Community-Based Early Childhood Care and Development 1,900 TOTAL 34,000


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Statistical Annex 28 PROJECTS WITH ADB-ADMINISTERED GRANT FINANCING, 2008 APPROVALS

Amount ($ thousand)

Project Name Technical Soft Loan Assistance Component

BILATERAL TRUST FUNDS

Australia CAM Road Asset Management 4,800.00 LAO Sector-Wide Approach in Education Sector Development (Supplementary) 477.00 SOL Road Improvement Sector (Supplementary) 469.88 TUV Capacity Building for Taxation Reforms (Supplementary) 270.00 TUV Capacity Building for Public Financial Management 57.75 REG Enhancing Effective Regulation of Water and Energy Infrastructure and Utility Services (Supplementary) 700.00 REG Enhancing Transport and Trade Facilitation in the Greater Mekong Subregion 250.00 REG HIV Prevention and Infrastructure: Mitigating Risk in the Greater Mekong Subregion 6,000.00 REG Impact of Maternal and Child Health Private Expenditure on Poverty and Inequity 326.00 REG Strengthening Governance and Accountability in Pacific Island Countries (Phase 2) 400.00 REG Strengthening Pro-Poor Policy in the Pacific (Supplementary) 232.00 REG Private Sector Development Initiative (Supplementary) 300.00 REG Strengthening Pacific Economic Analysis and Policy Development 400.00

Subtotal 9,412.75 5,269.88

Canada BAN Emergency Disaster Damage Rehabilitation (Sector) 10,000.00

Subtotal 10,000.00

Second Danish Cooperation Fund for Renewable Energy and Energy Efficiency in Rural Areas IND Facilitating the Operations of the Energy Conservation Fund “Energy Smart” in Madhya Pradesh 1,700.00

Subtotal 1,700.00

Finland REG Strengthening Coastal and Marine Resources Management in the Coral Triangle of the Pacific (Phase 1) 550.00 REG Core Environment Program and Biodiversity Conservation Corridors Initiative in the Greater Mekong Subregion (Supplementary) 4,900.00

Subtotal 5,450.00

France VIE Ho Chi Minh City Water Supply 1,500.00

Subtotal 1,500.00

Japan–Asian Clean Energy Fund under the Clean Energy Financing Partnership Facility BHU Green Power Development 1,000.00

1,000.00 Republic of Korea e-Asia and Knowledge Partnership Fund LAO Piloting Community e-Centers for Better Health 500.00 NEP Knowledge Transfer for Public Procurement 500.00 PHI Capacity Building for Housing Microfinance (Supplementary) 500.00 THA Capacity Building and School Networking for Educational Services (e-Learning) in Thailand 500.00 VIE Geo-Information Technology for Hazard Risk Assessment 500.00 REG Harmonization of Bond Standards in ASEAN+3 500.00 REG Knowledge Sharing on Infrastructure Public–Private Partnerships in Asia 500.00 REG Rural Information and Communication Technology Policy Advocacy, Knowledge Sharing, and Capacity Building 500.00 REG Regional Knowledge and Partnership Networks for Poverty Reduction and Inclusive Growth 500.00

Subtotal 4,500.00

ASEAN+3 = Association of Southeast Asian Nations plus the People’s Republic of China, Japan, and Republic of Korea; BAN = Bangladesh; BHU = Bhutan; CAM = Cambodia; IND = India; LAO = Lao People’s Democratic Republic; NEP = Nepal; PHI = Philippines; REG = regional; SOL = Solomon Islands; THA = Thailand; TUV = Tuvalu; VIE = Viet Nam.


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The Netherlands INO Instititutional Strengthening for Integrated Water Resources Management in the 6 Cis River Basin Territory 5,000.00 VIE Viet Nam Water Sector Review 550.00 REG Core Environment Program and Biodiversity Conservation Corridors Initiative in the Greater Mekong Subregion (Supplementary) 800.00 REG Energy for All Initiative 2,300.00

Subtotal 8,650.00

The Netherlands Trust Fund for the Water Financing Partnership Facility NEP Secondary Towns Integrated Urban Environmental Improvement 146.00 SRI Dry Zone Urban Water and Sanitation 2,000.00 VIE Hue Water Supply 1,500.00 VIE Hai Phong Water Supply 1,000.00 REG Mekong Water Supply and Sanitation 300.00 REG Knowledge and Innovation Support for ADB’s Water Financing Program 800.00

Subtotal 3,746.00 2,000.00

New Zealand REG Greater Mekong Subregion Phnom Penh Plan for Development Management III (2nd Supplementary) 400.00

Subtotal 400.00

Norway REG Development Partnership Program for South Asia (Supplementary) 300.00

Subtotal 300.00

People’s Republic of China Regional Cooperation and Poverty Reduction Fund REG Developing a Computable General Equilibrium Modeling Framework for Analyzing the Impacts of Power Trading between Mongolia and the People’s Republic of China 150.00 REG Central Asia Regional Economic Cooperation Institute, 2009–2012 500.00 REG Development Study of GMS Economic Corridors (Supplementary) 400.00 REG Enhancing Transport and Trade Facilitation in the Greater Mekong Subregion 500.00 REG Capacity Building and Institutional Strengthening of the Free Trade Agreement Units of Selected ASEAN Member Countries 500.00 REG Greater Mekong Subregion Phnom Penh Plan for Development Management III (Supplementary) 500.00 REG Supporting the Boao Forum for Asia 500.00 REG Core Environment Program and Biodiversity Conservation Corridors Initiative in the Greater Mekong Subregion (Supplementary) 500.00 REG Regional Knowledge and Partnership Networks for Poverty Reduction and Inclusive Growth 500.00 REG Accelerating the Implementation of the Core Agriculture Support Program 500.00

Subtotal 4,550.00

Spain PRC Dryland Sustainable Agriculture 350.00 REG Managing the Cities in Asia (Supplementary) 2,000.00

Subtotal 2,000.00 350.00

ASEAN = Association of Southeast Asian Nations, GMS = Greater Mekong Subregion, INO = Indonesia, NEP = Nepal, PRC = People’s Republic of China, REG = regional, SRI = Sri Lanka, VIE = Viet Nam.


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Sweden REG Development Partnership Program for South Asia (Supplementary) 288.00 REG Rolling Out Air Quality Management in Asia (Supplementary) 484.63

Subtotal 772.63 Switzerland BAN Post Literacy and Continuing Education (Supplementary) 2,500.00 BAN Skills Development 6,000.00

Subtotal 8,500.00

United Kingdom CAM Health Sector Support (Supplementary) 1,800.00 NEP Rural Reconstruction and Rehabilitation Sector Development Project (Supplementary) 20,000.00 VIE Making Markets Work Better for the Poor (Phase 2) 8,000.00 REG A Development Framework for Sustainable Urban Transport (Supplementary) 120.00 REG A Development Framework for Sustainable Urban Transport (2nd Supplementary) 100.00

Subtotal 8,220.00 21,800.00

MULTIDONOR COOPERATION FUNDS/PARTNERSHIPS

Clean Energy Fund PHI Pasuquin East Wind Farm Development 200.00 PRC Railway Sector Energy Efficiency Strategy 800.00 PRC Capacity Building for Energy Efficiency Implementation 800.00 THA Mainstreaming Energy Efficiency Measures in Thai Municipalities 1,000.00 REG Promoting Energy Efficiency in the Pacific 1,200.00

Subtotal 3,200.00 800.00 Cooperation Fund for Fighting HIV/AIDS in Asia and the Pacific MON HIV/AIDS Prevention in ADB Infrastructure Projects and the Mining Sector 1,000.00 REG Fighting HIV/AIDS in Asia and the Pacific (Supplementary) 1,000.00 REG Fighting HIV/AIDS in Asia and the Pacific (2nd Supplementary) 300.00

Subtotal 2,300.00

Cooperation Fund for the Water Sector PAK Sindh Basic Urban Services (Supplementary) 80.00 SRI Institutional Strengthening for Decentralized Service Delivery in the Water Sector 50.00 REG Promoting Effective Water Management Policies and Practices – Phase 5 (Supplementary) 1,219.00

Subtotal 1,349.00

European Commission SOL Domestic Maritime Support (Sector) 5,250.00 SOL Establishment of the Solomon Islands Maritime Safety Administration 600.00

Subtotal 600.00 5,250.00

Gender and Development Cooperation Fund PHI Supporting Governance in Justice Sector Reform in the Philippines 500.00 REG Enhancing Gender and Development Capacity in Developing Member Countries – Phase 2 (Supplementary) 1,000.00 REG Promoting Gender Equality and Women’s Empowerment (Supplementary) 1,000.00

Subtotal 2,500.00

BAN = Bangladesh, CAM = Cambodia, HIV/AIDS = human immunodeficiency virus/acquired immunodeficiency syndrome, MON = Mongolia, NEP = Nepal, PAK = Pakistan, PHI = Philippines, PRC = People’s Republic of China, REG = regional, SOL = Solomon Islands, SRI = Sri Lanka, THA = Thailand, VIE = Viet Nam.


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Governance Cooperation Fund REG Support for Implementarion of the Second Governance and Anticorruption Action Plan 2,600.00

Subtotal 2,600.00

Global Environment Facility INO Integrated Citarum Water Resources Management (Supplementary) 200.00 KGZ Southern Agriculture Area Development (Supplementary) 2,500.00 PRC Ningxia Integrated Ecosystem and Agricultural Development 4,545.00 TAJ Rural Development (Supplementary) 3,500.00 UZB Land Improvement 3,000.00 REG Implementation of the Seed Capital Assistance Facility 4,200.00 REG Strengthening Coastal and Marine Resources Management in the Coral Triangle of the Pacific (Phase 1) 300.00 REG Strengthening Sound Environmental Management in the Brunei Darussalam, Indonesia, Malaysia, and Philippines East ASEAN Growth Area (Supplementary) 500.00

Subtotal 5,200.00 13,545.00 Investment Climate Facilitation Fund REG Harmonization of Bond Standards in ASEAN+3 450.00 REG Minimizing Foreign Exchange Settlement Risk in the ASEAN+3 Region: Support for Group of Experts 850.00 REG Enhancing Financial Disclosure Standards in Armenia, Azerbaijan, and Georgia 600.00

Subtotal 1,900.00 Poverty and Environment Fund REG Mainstreaming Environment for Poverty Reduction (Supplementary) 2,600.00

Subtotal 2,600.00 Water Financing Partnership Facility IND Instititutional Development of Integrated Water Resources Management in Orissa 250.00 IND Integrated Flood and River Erosion Management – Arunachal Pradesh 750.00 IND Integrated Flood and Riverbank Erosion Risk Management – Assam (Phase 2): Processing and Institutional Strengthening 750.00 INO Metropolitan Sanitation Management and Health (Supplementary) 500.00 INO Instititutional Strengthening for Integrated Water Resources Management in the 6 Cis River Basin Territory 2,000.00 PHI Water District Development Sector 1,200.00 PRC Enabling the Protection of Jiaozhou Bay Water Quality and Wetland Ecosystem 400.00 PRC Preparing National Guidelines for Eco-Compensation in River Basins and a Framework for Soil Pollution Management 400.00 PRC River Basin Water Resources Allocation and Management Policy 250.00 PRC Urban Wastewater Reuse and Sludge Utilization Policy Study 300.00 UZB Surkhandarya Water Supply and Sanitation 1,500.00 VIE Da Nang Water Supply 1,500.00 VIE Developing Benefit Sharing Mechanisms for People Adversely Affected by Power Generation Projects (Supplementary) 240.00 REG Improved Management of Water Resources in Central Asia 998.00 REG Knowledge and Innovation Support for ADB’s Water Financing Program 1,200.00

Subtotal 10,738.00 1,500.00

TOTAL 84,188.38 70,014.88

ASEAN = Association of Southeast Asian Nations; ASEAN+3 = ASEAN plus the People’s Republic of China, Japan, and Republic of Korea; IND = India; INO = Indonesia; KGZ = Kyrgyz Republic; PHI = Philippines; PRC = People’s Republic of China; REG = regional; TAJ = Tajikistan; UZB = Uzbekistan; VIE = Viet Nam.


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Statistical Annex 29 CONTRACTS AWARDED BY COUNTRY OF ORIGIN,a 2008 PROJECT LOANS—ORDINARY CAPITAL RESOURCES (amounts in $ million) Goods, Related Services, and Civil Works Consulting Services Total Procurement

Amount % Distribution Amount % Distribution Amount % Distribution

Afghanistan – – – – – – Armenia – – – – – – Australia 0.28 0.01 5.47 5.99 5.75 0.18 Austria – – – – – – Azerbaijan 7.84 0.26 – – 7.84 0.25 Bangladesh 7.24 0.24 – – 7.24 0.23 Belgium 0.70 0.02 – – 0.70 0.02 Bhutan – – – – – – Brunei Darussalam – – – – – – Cambodia – – – – – – Canada 1.95 0.06 1.64 1.79 3.58 0.12 China, People’s Republic of 1,236.83 40.99 2.46 2.69 1,239.29 39.86 Cook Islands – – – – – – Denmark 0.98 0.03 – – 0.98 0.03 Fiji Islands 6.18 0.20 – – 6.18 0.20 Finland 3.71 0.12 – – 3.71 0.12 France 0.41 0.01 6.78 7.42 7.19 0.23 Georgia – – – – – – Germany 122.20 4.05 1.36 1.49 123.56 3.97 Hong Kong, China 1.20 0.04 1.67 1.83 2.87 0.09 India 695.93 23.06 28.03 30.68 723.96 23.29 Indonesia 106.10 3.52 4.51 4.93 110.60 3.56 Ireland – – – – – – Italy 2.75 0.09 – – 2.75 0.09 Japan 64.67 2.14 0.68 0.74 65.35 2.10 Kazakhstan 10.57 0.35 – – 10.57 0.34 Kiribati – – – – – – Korea, Republic of 286.99 9.51 1.16 1.27 288.16 9.27 Kyrgyz Republic – – 0.01 0.01 0.01 0.00 Lao People’s Democratic Republic – – – – – – Luxembourg 0.37 0.01 – – 0.37 0.01 Malaysia 28.80 0.95 1.06 1.16 29.86 0.96 Maldives – – – – – – Marshall Islands – – – – – – Micronesia, Federated States of – – – – – – Mongolia – – – – – – Myanmar – – – – – – Nauru – – – – – – Nepal – – – – – – The Netherlands 1.31 0.04 2.00 2.18 3.31 0.11 New Zealand – – 0.06 0.06 0.06 0.00 Norway 0.02 0.00 – – 0.02 0.00 Pakistan 151.45 5.02 10.22 11.19 161.67 5.20 Palau – – – – – – Papua New Guinea 10.87 0.36 – – 10.87 0.35 Philippines 25.09 0.83 0.50 0.55 25.59 0.82 Portugal – – – – – – Samoa – – – – – – Singapore 5.44 0.18 3.34 3.65 8.78 0.28 Solomon Islands – – – – – – Spain – – – – – – Sri Lanka 124.39 4.12 6.11 6.69 130.50 4.20 Sweden 0.75 0.02 – – 0.75 0.02 Switzerland 0.32 0.01 – – 0.32 0.01 Taipei,China 0.69 0.02 – – 0.69 0.02 Tajikistan – – – – – – Thailand 11.98 0.40 – – 11.98 0.39 Timor-Leste – – – – – – Tonga – – – – – – Turkey 0.35 0.01 – – 0.35 0.01 Turkmenistan – – – – – – Tuvalu – – – – – – United Kingdom 0.98 0.03 10.44 11.43 11.42 0.37 United States 8.28 0.27 3.47 3.80 11.75 0.38 Uzbekistan 16.14 0.53 0.39 0.43 16.53 0.53 Vanuatu – – – – – – Viet Nam 74.03 2.45 – – 74.03 2.38 Regional – – – – – – International – – – – – –

TOTALb 3,017.74 100.00 91.36 100.00 3,109.09 100.00

– = nil, 0.00 = % is less than 0.01.a Represents the country of origin where the goods are mined, produced, grown, and/or manufactured, based on US dollar value equivalent of contract.b Totals may not add up because of rounding.


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Statistical Annex 30 CONTRACTS AWARDED BY COUNTRY OF ORIGIN,a 2008 PROJECT LOANS—ASIAN DEVELOPMENT FUND (amounts in $ million) Goods, Related Services, and Civil Works Consulting Services Total Procurement


Afghanistan 3.49 0.28 0.01 0.00 3.50 0.25 Armenia 19.45 1.57 2.02 1.47 21.47 1.56 Australia 3.78 0.31 6.07 4.40 9.85 0.71 Austria – – – – – – Azerbaijan 14.30 1.15 3.29 2.39 17.59 1.28 Bangladesh 165.97 13.38 11.45 8.30 177.43 12.88 Belgium 0.05 0.00 – – 0.05 0.00 Bhutan 17.23 1.39 – – 17.23 1.25 Brunei Darussalam – – – – – – Cambodia 13.35 1.08 4.28 3.11 17.64 1.28 Canada 0.08 0.01 3.31 2.40 3.39 0.25 China, People’s Republic of 80.60 6.50 1.11 0.80 81.71 5.93 Cook Islands – – – – – – Denmark – – – – – – Fiji Islands – – – – – – Finland 0.11 0.01 – – 0.11 0.01 France 15.46 1.25 1.40 1.01 16.86 1.22 Georgia 69.86 5.63 – – 69.86 5.07 Germany 1.50 0.12 0.43 0.31 1.93 0.14 Hong Kong, China 0.98 0.08 – – 0.98 0.07 India 97.72 7.88 1.75 1.27 99.47 7.22 Indonesia 40.79 3.29 23.41 16.97 64.20 4.66 Ireland – – – – – – Italy 1.16 0.09 – – 1.16 0.08 Japan 11.90 0.96 13.06 9.47 24.96 1.81 Kazakhstan 0.06 0.00 – – 0.06 0.00 Kiribati 0.07 0.01 – – 0.07 0.00 Korea, Republic of 2.21 0.18 8.07 5.85 10.28 0.75 Kyrgyz Republic 8.51 0.69 0.66 0.48 9.16 0.66 Lao People’s Democratic Republic 18.74 1.51 0.82 0.59 19.56 1.42 Luxembourg – – – – – – Malaysia 0.86 0.07 1.14 0.83 2.00 0.15 Maldives 2.74 0.22 0.26 0.19 3.00 0.22 Marshall Islands 0.02 0.00 – – 0.02 0.00 Micronesia, Federated States of 0.98 0.08 – – 0.98 0.07 Mongolia 5.72 0.46 0.13 0.09 5.84 0.42 Myanmar 0.30 0.02 – – 0.30 0.02 Nauru – – – – – – Nepal 37.39 3.02 2.34 1.69 39.73 2.88 The Netherlands 0.45 0.04 3.42 2.48 3.88 0.28 New Zealand 2.53 0.20 0.74 0.53 3.26 0.24 Norway – – – – – – Pakistan 196.79 15.87 4.54 3.29 201.33 14.61 Palau – – – – – – Papua New Guinea 4.28 0.35 0.24 0.17 4.53 0.33 Philippines 0.21 0.02 0.09 0.07 0.31 0.02 Portugal 0.01 0.00 – – 0.01 0.00 Samoa 3.54 0.29 0.61 0.44 4.15 0.30 Singapore 9.09 0.73 – – 9.09 0.66 Solomon Islands 0.02 0.00 – – 0.02 0.00 Spain 0.02 0.00 – – 0.02 0.00 Sri Lanka 89.59 7.23 1.35 0.98 90.95 6.60 Sweden – – 2.30 1.67 2.30 0.17 Switzerland 0.04 0.00 0.10 0.07 0.14 0.01 Taipei,China 0.69 0.06 4.98 3.61 5.67 0.41 Tajikistan 23.50 1.90 – – 23.50 1.71 Thailand 34.83 2.81 – – 34.83 2.53 Timor-Leste – – – – – – Tonga – – – – – – Turkey – – – – – – Turkmenistan – – – – – – Tuvalu – – – – – – United Kingdom 0.50 0.04 8.57 6.21 9.07 0.66 United States 5.89 0.48 22.80 16.53 28.69 2.08 Uzbekistan 1.88 0.15 – – 1.88 0.14 Vanuatu 0.05 0.00 – – 0.05 0.00 Viet Nam 230.70 18.60 3.17 2.30 233.86 16.97 Regional – – – – – – International – – – – – –

TOTALb 1,239.99 100.00 137.92 100.00 1,377.90 100.00

– = nil, 0.00 = % is less than 0.01.a Represents the country or origin where the goods are mined, produced, grown and/or manufactured, based on US dollar value equivalent of contract.b Totals may not add up because of rounding.


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Statistical Annex 31 CONTRACTS AWARDED BY COUNTRY OF ORIGIN,a 2008 PROJECT LOANS—ORDINARY CAPITAL RESOURCES AND ASIAN DEVELOPMENT FUND COMBINED (amounts in $ million) Goods, Related Services, and Civil Works Consulting Services Total Procurement


Afghanistan 3.49 0.08 0.01 0.00 3.50 0.08 Armenia 19.45 0.46 2.02 0.88 21.47 0.48 Australia 4.06 0.10 11.54 5.03 15.60 0.35 Austria – – – – – – Azerbaijan 22.13 0.52 3.29 1.44 25.43 0.57 Bangladesh 173.21 4.07 11.45 5.00 184.66 4.12 Belgium 0.76 0.02 – – 0.76 0.02 Bhutan 17.23 0.40 – – 17.23 0.38 Brunei Darussalam – – – – – – Cambodia 13.35 0.31 4.28 1.87 17.64 0.39 Canada 2.03 0.05 4.95 2.16 6.98 0.16 China, People’s Republic of 1,317.42 30.94 3.57 1.56 1,321.00 29.44 Cook Islands – – – – – – Denmark 0.98 0.02 – – 0.98 0.02 Fiji Islands 6.18 0.15 – – 6.18 0.14 Finland 3.82 0.09 – – 3.82 0.09 France 15.88 0.37 8.18 3.57 24.06 0.54 Georgia 69.86 1.64 – – 69.86 1.56 Germany 123.69 2.91 1.80 0.78 125.49 2.80 Hong Kong, China 2.17 0.05 1.67 0.73 3.84 0.09 India 793.64 18.64 29.78 12.99 823.42 18.35 Indonesia 146.89 3.45 27.92 12.18 174.81 3.90 Ireland – – – – – – Italy 3.91 0.09 – – 3.91 0.09 Japan 76.57 1.80 13.74 5.99 90.30 2.01 Kazakhstan 10.62 0.25 – – 10.62 0.24 Kiribati 0.07 0.00 – – 0.07 0.00 Korea, Republic of 289.20 6.79 9.23 4.03 298.43 6.65 Kyrgyz Republic 8.51 0.20 0.67 0.29 9.17 0.20 Lao People’s Democratic Republic 18.74 0.44 0.82 0.36 19.56 0.44 Luxembourg 0.37 0.01 – – 0.37 0.01 Malaysia 29.66 0.70 2.20 0.96 31.87 0.71 Maldives 2.74 0.06 0.26 0.11 3.00 0.07 Marshall Islands 0.02 0.00 – – 0.02 0.00 Micronesia, Federated States of 0.98 0.02 – – 0.98 0.02 Mongolia 5.72 0.13 0.13 0.05 5.84 0.13 Myanmar 0.30 0.01 – – 0.30 0.01 Nauru – – – – – – Nepal 37.39 0.88 2.34 1.02 39.73 0.89 The Netherlands 1.77 0.04 5.42 2.36 7.19 0.16 New Zealand 2.53 0.06 0.79 0.35 3.32 0.07 Norway 0.02 0.00 – – 0.02 0.00 Pakistan 348.24 8.18 14.76 6.44 363.00 8.09 Palau – – – – – – Papua New Guinea 15.15 0.36 0.24 0.11 15.39 0.34 Philippines 25.30 0.59 0.60 0.26 25.89 0.58 Portugal 0.01 0.00 – – 0.01 0.00 Samoa 3.54 0.08 0.61 0.27 4.15 0.09 Singapore 14.53 0.34 3.34 1.46 17.87 0.40 Solomon Islands 0.02 0.00 – – 0.02 0.00 Spain 0.02 0.00 – – 0.02 0.00 Sri Lanka 213.98 5.03 7.47 3.26 221.45 4.94 Sweden 0.75 0.02 2.30 1.00 3.05 0.07 Switzerland 0.36 0.01 0.10 0.04 0.45 0.01 Taipei,China 1.37 0.03 4.98 2.17 6.35 0.14 Tajikistan 23.50 0.55 – – 23.50 0.52 Thailand 46.81 1.10 – – 46.81 1.04 Timor-Leste – – – – – – Tonga – – – – – – Turkey 0.35 0.01 – – 0.35 0.01 Turkmenistan – – – – – – Tuvalu – – – – – – United Kingdom 1.48 0.03 19.01 8.29 20.49 0.46 United States 14.17 0.33 26.28 11.46 40.45 0.90 Uzbekistan 18.01 0.42 0.40 0.17 18.41 0.41 Vanuatu 0.05 0.00 – – 0.05 0.00 Viet Nam 304.72 7.16 3.17 1.38 307.89 6.86 Regional – – – – – – International – – – – – –

TOTALb 4,257.72 100.00 229.28 100.00 4,487.00 100.00

– = nil, 0.00 = % is less than 0.01.a Represents the country or origin where the goods are mined, produced, grown and/or manufactured, based on US dollar value equivalent of contract.b Totals may not add up because of rounding.


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Statistical Annex 32 ESTIMATES OF PAYMENT TO SUPPLYING COUNTRIES FOR FOREIGN PROCUREMENT UNDER PROGRAM LENDING,a 2008 Ordinary Capital Resources (OCR) Asian Development Fund (ADF) Combined OCR and ADF

$ million % Distribution $ million % Distribution $ million % Distribution

Afghanistan 2.68 0.10 1.01 0.16 3.70 0.11 Armenia – – – – – – Australia 90.04 3.28 5.88 0.91 95.92 2.83 Austria 9.45 0.34 2.11 0.33 11.55 0.34 Azerbaijan 0.66 0.02 – – 0.66 0.02 Bangladesh 3.67 0.13 0.94 0.15 4.61 0.14 Belgium 37.61 1.37 4.25 0.66 41.86 1.24 Bhutan 0.24 0.01 0.10 0.02 0.35 0.01 Brunei Darussalam 11.45 0.42 – – 11.45 0.34 Cambodia 0.01 0.00 0.17 0.03 0.17 0.01 Canada 53.69 1.96 22.65 3.52 76.34 2.25 China, People’s Republic of 359.35 13.11 94.37 14.66 453.71 13.40 Cook Islands – – – – – – Denmark 5.44 0.20 1.44 0.22 6.88 0.20 Fiji Islands 0.01 0.00 – – 0.01 0.00 Finland 12.27 0.45 2.03 0.31 14.30 0.42 France 41.30 1.51 8.36 1.30 49.66 1.47 Georgia 0.02 0.00 – – 0.02 0.00 Germany 112.38 4.10 18.36 2.85 130.75 3.86 Hong Kong, China 57.94 2.11 18.69 2.90 76.62 2.26 India 50.90 1.86 38.56 5.99 89.45 2.64 Indonesia 101.55 3.70 50.86 7.90 152.41 4.50 Ireland 11.82 0.43 0.59 0.09 12.41 0.37 Italy 84.34 3.08 38.98 6.05 123.31 3.64 Japan 417.28 15.22 105.23 16.34 522.51 15.43 Kazakhstan 0.51 0.02 0.19 0.03 0.70 0.02 Kiribati – – – – – – Korea, Republic of 131.52 4.80 20.99 3.26 152.51 4.50 Kyrgyz Republic 0.01 0.00 – – 0.01 0.00 Lao People’s Democratic Republic 0.01 0.00 0.18 0.03 0.18 0.01 Luxembourg 0.28 0.01 0.16 0.02 0.44 0.01 Malaysia 183.39 6.69 64.20 9.97 247.59 7.31 Maldives 0.39 0.01 0.18 0.03 0.57 0.02 Marshall Islands – – – – – – Micronesia, Federated States of – – – – – – Mongolia – – 0.05 0.01 0.05 0.00 Myanmar 3.65 0.13 0.92 0.14 4.56 0.13 Nauru – – – – – – Nepal 1.55 0.06 0.07 0.01 1.62 0.05 The Netherlands 34.46 1.26 4.91 0.76 39.36 1.16 New Zealand 12.64 0.46 1.08 0.17 13.72 0.41 Norway 4.14 0.15 1.29 0.20 5.43 0.16 Pakistan 3.99 0.15 1.70 0.26 5.70 0.17 Palau – – – – – – Papua New Guinea 3.25 0.12 0.01 0.00 3.25 0.10 Philippines 8.65 0.32 2.35 0.36 11.00 0.32 Portugal 1.15 0.04 0.68 0.11 1.83 0.05 Samoa – – – – – – Singapore 326.81 11.92 27.07 4.20 353.88 10.45 Solomon Islands 0.01 0.00 – – 0.01 0.00 Spain 13.13 0.48 2.16 0.34 15.29 0.45 Sri Lanka 4.57 0.17 0.86 0.13 5.43 0.16 Sweden 22.16 0.81 6.68 1.04 28.84 0.85 Switzerland 24.87 0.91 6.88 1.07 31.75 0.94 Taipei,China – – – – – – Tajikistan 0.05 0.00 0.10 0.02 0.15 0.00 Thailand 95.64 3.49 29.87 4.64 125.50 3.71 Timor-Leste – – – – – – Tonga 0.01 0.00 – – 0.01 0.00 Turkey 17.44 0.64 9.26 1.44 26.70 0.79 Turkmenistan 0.51 0.02 0.23 0.04 0.74 0.02 Tuvalu – – – – – – United Kingdom 62.43 2.28 11.97 1.86 74.40 2.20 United States 302.62 11.04 28.65 4.45 331.27 9.79 Uzbekistan 0.47 0.02 2.03 0.31 2.49 0.07 Vanuatu 0.10 0.00 – – 0.10 0.00 Viet Nam 17.11 0.62 4.62 0.72 21.73 0.64 Regional – – – – – – International – – – – – –

TOTALb 2,741.60 100.00 643.89 100.00 3,385.48 100.00

– = nil, 0.00 = % is less than 0.01.a Estimates are based on import data drawn from the latest information available on borrowers’ trade statistics compiled by the International Monetary Fund Direction

of Trade Statistics.b Totals may not add up because of rounding.


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Statistical Annex 33 CUMULATIVE CONTRACTS AWARDED BY COUNTRY OF ORIGINa TECHNICAL ASSISTANCE OPERATIONS (amounts in $ million, as of 31 December 2008) ADB’s % Administered % Japan % Total % Own Distri- Trust Distri- Special Distri- Contracts Distri- Resources bution Funds bution Fund bution Awarded bution

Afghanistan 1.25 0.09 1.63 0.31 0.02 0.00 2.91 0.11 Armenia 0.66 0.05 – – – – 0.66 0.02 Australia 163.39 12.31 64.11 12.15 126.09 13.89 353.57 12.80 Austria 1.35 0.10 – – 0.95 0.10 2.30 0.08 Azerbaijan 0.47 0.04 0.25 0.05 0.02 0.00 0.74 0.03 Bangladesh 15.81 1.19 5.13 0.97 6.36 0.70 27.30 0.99 Belgium 4.48 0.34 1.10 0.21 2.26 0.25 7.84 0.28 Bhutan 0.43 0.03 0.07 0.01 0.15 0.02 0.64 0.02 Cambodia 1.90 0.14 3.17 0.60 0.48 0.05 5.55 0.20 Canada 97.52 7.35 45.50 8.62 67.93 7.49 210.91 7.63 China, People’s Republic of 20.15 1.52 4.98 0.94 7.95 0.88 33.09 1.20 Cook Islands 0.09 0.01 0.16 0.03 – – 0.24 0.01 Denmark 12.66 0.95 5.07 0.96 17.95 1.98 35.68 1.29 Fiji Islands 1.27 0.10 0.72 0.14 0.23 0.03 2.22 0.08 Finland 10.22 0.77 6.45 1.22 9.03 1.00 25.71 0.93 France 29.76 2.24 17.88 3.39 23.32 2.57 70.95 2.57 Georgia 0.01 0.00 – – – – 0.01 0.00 Germany 25.46 1.92 16.24 3.08 35.76 3.94 77.45 2.80 Hong Kong, China 30.58 2.30 6.15 1.17 22.02 2.43 58.75 2.13 India 59.91 4.51 24.69 4.68 21.79 2.40 106.42 3.85 Indonesia 18.28 1.38 11.35 2.15 12.33 1.36 41.96 1.52 Ireland 0.20 0.02 – – – – 0.20 0.01 Italy 5.14 0.39 0.84 0.16 2.68 0.30 8.65 0.31 Japan 30.32 2.28 12.06 2.29 28.48 3.14 70.87 2.57 Kazakhstan 1.14 0.09 1.31 0.25 0.13 0.01 2.58 0.09 Kiribati 0.01 0.00 0.05 0.01 0.01 0.00 0.06 0.00 Korea, Republic of 5.03 0.38 1.56 0.30 4.03 0.44 10.61 0.38 Kyrgyz Republic 1.45 0.11 0.48 0.09 0.23 0.02 2.14 0.08 Lao People’s Democratic Republic 3.17 0.24 1.88 0.36 0.98 0.11 6.04 0.22 Malaysia 12.77 0.96 1.37 0.26 4.21 0.46 18.34 0.66 Maldives 0.11 0.01 0.05 0.01 0.03 0.00 0.18 0.01 Marshall Islands 0.19 0.01 0.19 0.04 0.01 0.00 0.38 0.01 Micronesia 0.01 0.00 – – 0.02 0.00 0.03 0.00 Mongolia 1.51 0.11 0.59 0.11 0.75 0.08 2.85 0.10 Myanmar 0.94 0.07 0.71 0.13 0.01 0.00 1.66 0.06 Nauru 0.01 0.00 0.01 0.00 – – 0.02 0.00 Nepal 10.94 0.82 5.04 0.95 2.46 0.27 18.38 0.67 The Netherlands 23.24 1.75 20.34 3.86 28.38 3.13 71.96 2.60 New Zealand 68.19 5.14 20.00 3.79 64.07 7.06 152.26 5.51 Norway 5.34 0.40 4.52 0.86 3.36 0.37 13.21 0.48 Pakistan 27.17 2.05 11.62 2.20 3.81 0.42 42.57 1.54 Palau 0.03 0.00 – – – – 0.03 0.00 Papua New Guinea 1.22 0.09 0.40 0.08 1.51 0.17 3.13 0.11 Philippines 96.42 7.26 24.93 4.72 33.85 3.73 155.28 5.62 Portugal 0.10 0.01 – – 0.09 0.01 0.19 0.01 Samoa 0.86 0.06 0.04 0.01 0.87 0.10 1.77 0.06 Singapore 17.78 1.34 2.96 0.56 10.69 1.18 31.42 1.14 Solomon Islands 0.50 0.04 0.19 0.04 0.22 0.02 0.91 0.03 Spain 5.75 0.43 2.90 0.55 1.02 0.11 9.68 0.35 Sri Lanka 13.17 0.99 3.51 0.66 3.86 0.43 20.50 0.74 Sweden 7.53 0.57 5.77 1.09 9.29 1.02 22.59 0.82 Switzerland 11.21 0.84 6.54 1.24 11.81 1.30 29.56 1.07 Taipei,China 1.08 0.08 0.07 0.01 2.71 0.30 3.85 0.14 Tajikistan 0.47 0.04 1.25 0.24 0.16 0.02 1.88 0.07 Thailand 14.17 1.07 8.19 1.55 12.07 1.33 34.43 1.25 Timor-Leste 0.74 0.06 0.18 0.03 0.10 0.01 1.03 0.04 Tonga 0.32 0.02 0.03 0.01 0.14 0.02 0.49 0.02 Turkey 0.42 0.03 0.27 0.05 0.05 0.01 0.73 0.03 Turkmenistan 0.10 0.01 0.05 0.01 – – 0.15 0.01 Tuvalu 0.06 0.00 – – – – 0.06 0.00 United Kingdom 175.47 13.22 66.50 12.60 134.93 14.87 376.89 13.64 United States 254.94 19.20 87.71 16.63 172.57 19.02 515.26 18.65 Uzbekistan 0.95 0.07 0.33 0.06 0.83 0.09 2.12 0.08 Vanuatu 0.75 0.06 0.01 0.00 1.20 0.13 1.96 0.07 Viet Nam 4.23 0.32 6.21 1.18 3.21 0.35 13.63 0.49 Regional 3.49 0.26 8.22 1.56 3.12 0.34 14.82 0.54 International Organizations 23.21 1.75 4.07 0.77 4.90 0.54 32.17 1.16

TOTALb 1,327.48 100.00 527.54 100.00 907.49 100.00 2,762.46 100.00

– = nil, 0.00 = % is less than 0.01.a Represents the country of origin where the goods are mined, produced, grown and/or manufactured, based on US dollar value equivalent of contract.b Totals may not add up because of rounding.


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Statistical Annex 34 CONTRACTS AWARDED BY COUNTRY OF ORIGIN,a 2006–2008 TECHNICAL ASSISTANCE OPERATIONS (amounts in $ million) 2006 2007 2008

Amount % Amount % Amount %

Afghanistan 0.39 0.25 0.85 0.46 0.26 0.17Armenia 0.30 0.19 0.23 0.12 0.10 0.06Australia 19.07 12.25 32.33 17.46 23.72 15.62Austria 1.30 0.83 – – 0.08 0.05Azerbaijan 0.14 0.09 – – 0.01 0.01Bangladesh 2.47 1.59 1.98 1.07 3.85 2.54Belgium 0.17 0.11 0.07 0.04 0.37 0.24Bhutan 0.01 0.00 0.10 0.06 0.09 0.06Brunei Darussalam – – – – – –Cambodia 1.29 0.83 0.37 0.20 0.77 0.51Canada 10.84 6.96 10.63 5.74 8.84 5.82China, People’s Republic of 4.39 2.82 5.05 2.73 3.33 2.20Cook Islands 0.01 0.01 – – 0.10 0.06Denmark 2.75 1.76 0.35 0.19 1.46 0.96Fiji Islands 0.09 0.06 0.19 0.10 0.30 0.20Finland 2.60 1.67 0.30 0.16 0.85 0.56France 1.09 0.70 3.58 1.93 11.04 7.27Georgia – – – – – –Germany 4.28 2.75 1.39 0.75 8.84 5.82Hong Kong, China 4.46 2.86 4.46 2.41 1.91 1.26India 9.80 6.29 17.59 9.50 11.51 7.58Indonesia 3.82 2.45 5.47 2.95 2.13 1.40Ireland – – 0.12 0.06 0.05 0.03Italy 0.07 0.04 0.11 0.06 0.29 0.19Japan 2.43 1.56 3.52 1.90 6.13 4.04Kazakhstan 0.38 0.24 0.17 0.09 0.12 0.08Kiribati 0.01 0.01 0.02 0.01 – –Korea, Republic of 0.44 0.28 0.26 0.14 0.45 0.30Kyrgyz Republic 0.36 0.23 0.16 0.08 0.22 0.14Lao People’s Democratic Republic 0.14 0.09 0.83 0.45 0.19 0.12Luxembourg – – – – – –Malaysia 1.39 0.89 1.48 0.80 1.90 1.25Maldives 0.03 0.02 0.04 0.02 – –Marshall Islands 0.08 0.05 0.04 0.02 0.04 0.03Micronesia, Federated States of 0.02 0.01 – – – –Mongolia 0.25 0.16 0.32 0.17 0.20 0.13Myanmar 0.01 0.01 0.22 0.12 – –Nauru – – – – – –Nepal 2.28 1.47 2.97 1.60 2.06 1.35The Netherlands 2.75 1.76 2.17 1.17 0.95 0.63New Zealand 8.53 5.48 7.91 4.27 8.74 5.75Norway 0.89 0.57 0.12 0.06 0.11 0.07Pakistan 5.44 3.50 4.78 2.58 4.15 2.73Palau – – 0.02 0.01 – –Papua New Guinea 0.35 0.23 0.08 0.05 0.28 0.18Philippines 10.62 6.82 11.74 6.34 6.80 4.48Portugal – – 0.07 0.04 – –Samoa 0.01 0.01 0.03 0.02 0.01 0.01Singapore 2.65 1.70 2.31 1.25 0.88 0.58Solomon Islands – – 0.18 0.10 0.12 0.08Spain 1.36 0.87 1.03 0.56 1.53 1.00Sri Lanka 0.76 0.49 1.96 1.06 0.65 0.43Sweden 1.04 0.67 2.79 1.51 1.71 1.13Switzerland 2.73 1.75 0.24 0.13 0.19 0.13Taipei,China 0.03 0.02 – – 0.66 0.44Tajikistan 0.30 0.19 0.94 0.51 0.04 0.03Thailand 1.95 1.25 2.62 1.41 1.19 0.78Timor-Leste – – 0.03 0.02 0.11 0.07Tonga 0.01 0.00 0.03 0.01 0.06 0.04Turkey 0.07 0.04 0.04 0.02 0.10 0.06Turkmenistan 0.02 0.01 0.04 0.02 – –Tuvalu – – – – – –United Kingdom 12.51 8.03 15.39 8.31 12.57 8.28United States 24.95 16.03 26.87 14.51 16.84 11.09Uzbekistan 0.37 0.24 0.72 0.39 0.26 0.17Vanuatu – – 0.01 0.00 – –Viet Nam 1.23 0.79 2.23 1.20 2.10 1.38Regional – – 5.67 3.06 – –International Organizations – – – – 0.59 0.39

TOTALb 155.69 100.00 185.17 100.00 151.83 100.00

– = nil, 0.00 = % is less than 0.01.a Represents the country of origin where the goods are mined, produced, grown, and or manufactured based on US dollar value equivalent of contract.b Totals may not add up because of rounding.

The Annual Report 2008 is printed using vegetable oil-based inks on recycled paper. The paper is made using a totally chlorine-free process.

About the front coverResidents of Kinjipi village in Papua New Guinea’s Western Highlands stop a basketball game to discuss how life will change when they have a paved road. ADB has financed the upgrading of several roads in the area.

Photo CreditsCover: Ian Gill; 6: Michael Hanson/Aurora Photos/Corbis; 158: Jonathan Blair/Corbis

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Annual Report 2008 - Asian Development Bank

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