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Supranationals Special Edition 2020 Says Multilateral Lenders Are Addressing Challenges From COVID-19

STOCKHOLM (S&P Global Ratings) Oct. 20, 2020--S&P Global Ratings has published its yearly report on multilateral lending institutions (MLIs) and other nonbank supranational institutions, a publication that started in 1986, "Supranationals Special Edition 2020."

"MLIs have been called on to address the challenges resulting from the COVID-19 pandemic and its lasting impacts on society, health systems, and the global economy--given their unique roles and mandates encompassing a variety of social objectives," said S&P Global Ratings credit analyst Alexis Smith-Juvelis.

MLI ratings have held up well as a result of strong balance sheets going into the crisis with significant buffers available. "We believe the sector will continue to hold up amid ongoing credit pressures, as indicated by our current outlooks," Ms. Smith-Juvelis said.

MLI financing is becoming ever more critical, particularly for the most vulnerable countries. Many MLIs announced important financing packages, which largely represent a reallocation of existing resources, as lending capacity is generally balanced by capital considerations, and a large number of institutions are anchored by conservative risk tolerances. MLI's capital positions are robust and can withstand significant credit pressures, though capital and rating resiliency is mostly contingent on their preferred creditor treatment, which has been upheld by most borrowing members.

While there may be some reprioritization of sector lending to meet specific health and social objectives, these will continue to be anchored firmly within the Sustainable Development Goals 2030 objectives. Environmental sustainability and addressing climate change will also continue to be prioritized as these are cross-cutting principles built into their lending activities.

The report includes summaries of rated supranationals, our criteria for rating supranationals, rating histories, and comparative data. We have published the report's introduction and comparative data tables (see "Introduction To Supranationals Special Edition 2020" and "Supranationals Special Edition 2020: Comparative Data For Multilateral Lending Institutions").

This report does not constitute a rating action.

The report is available to subscribers of RatingsDirect at www.capitaliq.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-7280 or sending an e-mail to research_request@spglobal.com. Ratings information can also be found on S&P Global Ratings' public website by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.

Primary Credit Analysts:Alexander Ekbom, Stockholm (46) 8-440-5911;
alexander.ekbom@spglobal.com
Alexis Smith-juvelis, New York + 1 (212) 438 0639;
alexis.smith-juvelis@spglobal.com
Research Contributor:Prajakta Rege, CRISIL Global Analytical Center, an S&P affiliate, Mumbai
Media Contact:Miriam Hespanhol, New York + 1 (212) 438 1406;
miriam.hespanhol@spglobal.com

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