29 DE JULHO DE 1988

1891

v) In making or guaranteeing a loan, the Bank shall pay due regard to the prospects that the borrower, and if the borrower is not a member, that the guarantor, will be in position to meet its obligations under the loan; and the Bank shall act prudently in the interests both of the particular member in whose territories the project is located and of the members as a whole;

vi) In guaranteeing a loan made by other investors, the Bank receives suitable compensation for its risk;

vii) Loans made or guaranteed by the Bank shall, except in special circumstances, be for the purpose of specific projects of reconstruction or development.

Seciion 5

Use of loans guaranteed, participated In or made by the Bank

a) The Bank shall impose no conditions that the proceeds of a loan shall be spent in the territories of any particular member or members.

b) The Bank shall make arrangements to ensure that the proceeds of any loan are used only for the purposes for which the loan was granted, with due attention to considerations of economy and efficiency and without regard to political or other non-economic influences or considerations.

c) In the case of loans made by the Bank, it shall open an account in the name of the borrower and the amount of the loan shall be credited to this account in the currency or currencies in which the loan is made. The borrower shall be permitted by the Bank to draw on this account only to meet expenses in connection with the project as they are actually incurred.

Section 6

Loans to the International Finance Corporation*

a) The Bank may make, participate in, or guarantee loans to the International Finance Corporation, an affiliate of the Bank, for use in its lending operations. The total amount outstanding of such loans, participations and guarantees shall not be increased if, at the time or as a result thereof, the aggregate amount of debt (including the guarantee of any debt) incurred by the said Corporation from any source and then outstanding shall exceed an amount equal to four times its unimpaired subscribed capital and surplus.

b) The provisions of article ill, sections 4 and 5, c), and of article iv, section 3, shall not apply to loans, participations and guarantees authorized by this section.

0 Section added by amendment effective December 17, 1965.

ARTICLE IV Operations

Section t

Methods of making or facilitating loans

a) The Bank may make or facilitate loans which satisfy the general conditions of article m in any of the following ways:

/) By making or participating in direct loans out of its own funds corresponding to its unimpaired paid-up capital and surplus and, subject to section 6 of this article, to its reserves;

if) By making or participating in direct loans out of funds raised in the market of a member, or otherwise borrowed by the Bank;

Hi) By guaranteeing in whole or in part loans made by private investors through the usual investment channels.

b) The Bank may borrow funds under a), if), above or guarantee loans under a), Hi), above only with the approval of the member in whose markets the funds are raised and the member in whose currency the loan is denominated, and only if those members agree that the proceeds may be exchanged for the currency of any other member without restriction.

Section 2

Availability and transferability of currencies

a) Currencies paid into the Bank under article n, section 7, 0. shall be loaned only with the approval in each case of the member whose currency is involved; provided, however, that if necessary, after the Bank's subscribed capital has been entirely called, such currencies shall, without restriction by the members whose currencies are offered, be used or exchanged for the currencies required to meet contractual payments of interest, other charges or amortization on the Bank's own borrowings, or to meet the Bank's liabilities with respect to such contractual payments on loans guaranteed by the Bank.

b) Currencies received by the Bank from borrowers or guarantors in payment on account of principal of direct loans made with currencies referred to in a) above shall be exchanged for the currencies of other members or reloaned only with the approval in each case of the members whose currencies are involved; provided, however, that if necessary, after the Bank's subscribed capital has been entirely called, such currencies shall, without restriction by the members whose currencies are offered, be used or exchanged for the currencies required to meet contractual payments of interest, other charges or amortization on the Bank's own borrowings, or to meet the Bank's liabilities with respect to such contractual payments on loans guaranteed by the Bank.

c) Currencies received by the Bank from borrowers or guarantors in payment on account of principal of direct loans made by the Bank under section 1, a), if),