World Bank Group

The World Bank, formally the International Bank for Reconstruction and Development (IBRD), was also created at Bretton Woods in 1944, as the IMF's sister institution — where the IMF addresses short-term monetary stability, the World Bank finances long-term development.

Objectives: to assist the reconstruction of member economies after the war; to promote long-term capital investment for productive purposes; to encourage international investment by guaranteeing loans made by private investors; and, in its later mandate, to reduce poverty and promote sustainable development in low- and middle-income countries.

Functions: the World Bank lends to member governments (and, with government guarantee, to public agencies) for infrastructure, agriculture, education, health, and institutional-reform projects, funded by borrowing on international capital markets and by member subscriptions.

Over time, the "World Bank" came to mean not just the IBRD but a group of five affiliated institutions, each with a distinct purpose:

• IBRD — lends to creditworthy middle-income and lower-income government borrowers at near-market terms.
• IDA (International Development Association), 1960 — provides interest-free or very-low-interest loans and grants to the world's poorest countries, which cannot afford IBRD terms.
• IFC (International Finance Corporation), 1956 — supports private-sector investment in developing countries, without needing a government guarantee.
• MIGA (Multilateral Investment Guarantee Agency), 1988 — provides political-risk insurance to encourage foreign direct investment into developing countries. …