III.

Affiliates

The bank has two affiliates: the International Finance Corporation (IFC), established in 1956; and the International Development Association (IDA), established in 1960. Membership in the bank is a prerequisite for membership in either the IFC or the IDA. All three institutions share the same president and boards of governors and executive directors.

IDA is the bank's concessionary lending affiliate, designed to provide development finance for those countries that do not qualify for loans at market-based interest rates. IDA soft loans, or “credits”, are longer term than those of the bank and bear no interest; only an annual service charge of 0.75 per cent is made. The IDA depends for its funds on subscriptions from its most prosperous members and on transfers of income from the bank.

All three institutions are legally and financially separate, but the bank and IDA share the same staff; IFC has its own operating and legal staff, but uses administrative and other services of the bank. Membership in the International Monetary Fund is a prerequisite for membership in the World Bank and its affiliates.