The Asian Development Bank (ADB) is a multilateral development finance institution
founded in 1966 to promote social and economic progress in its developing member
countries in Asia and the Pacific (see ADB’s website: http://www.adb.org/about/main).
2.2 ADB’s principal functions are
- lending funds,
- providing grants,
- providing technical assistance and advisory services,
- promoting investments for development purposes, and
- assisting in coordinating the development policies and plans of developing
member countries.
Inquiries
2.3 Loan disbursement is handled by the Loan Administration Division of the Controller’s
Department.
2.4 For loan service payments and billing matters, inquiries are addressed to the
Accounting Division of the Controller’s Department.
Loan or Grant Regulations
3.4 The regulations4
further set out conditions for the use of loan or grant proceeds
financed by ADB, or proceeds administered by ADB.
5
These documents are expressly
incorporated in the associated loan agreement, guarantee agreement, or grant
agreement. If any provision of a loan agreement, guarantee agreement, or grant
agreement is inconsistent with a provision of these regulations, the provision of the
loan agreement, guarantee agreement, or grant agreement governs.
Loan Documents
3.5 Loan documents
6
include the following documents and agreements:
ȕ Thereport and recommendation of the President to the Board of Directors
(RRP) presents the project proposal for consideration by the ADB Board.
ȕ Theproject administration manual (PAM)
7
includes all the information and
schedules describing project implementation and project readiness filters
covering major preproject implementation actions (e.g., government approvals,
procurement, and resettlement) to ensure a rapid start-up and enable early
disbursement. It is mandatory
8
that the PAM be referenced in the RRP and in
the loan (or facility) agreements, is presented as a stand-alone linked document
to the RRP, and serves as the main document describing implementation details.
The PAM is prepared in the course of loan processing and initially agreed with
the government at the loan fact-finding stage. At loan negotiations, the borrower
and ADB shall review and confirm the PAM agreed during loan fact-finding to
ensure consistency with the loan agreement, and such confirmation shall be
reflected in the minutes of the loan negotiations. The detailed cost estimate by
financier (one schedule included in the PAM) is prepared based on Section J6 of
the ADB Operations Manual (Appendix 3A).
9
Related illustrative tables are also
provided in this handbook (Appendix 3B).

on behalf of the borrower, together with the authenticated

8:05 AM    

reviews Schedule 3 of the loan agreement
4
which provides details of ADB
financing such as amount, disbursement percentages (Sections 4.8–4.9), items of
financing, and applicable conditions of financing;
ȕ maintains records (see Section 4.29 for retention period) for all signed contracts
in a contract ledger for reference; and
ȕ takes proper actions for procurement in accordance with ADB guidelines.
5


Basic Requirements for Disbursement
4.6  The first withdrawal from the loan account requires the following:
ȕ ADB declared the loan effective;
ȕ the borrower submitted to ADB sufficient evidence of the authority of the
person(s) who will sign withdrawal applications (WAs) (Chapter 5) on behalf
of the borrower, together with the authenticated specimen signature of
each authorized person (Appendix 4B); any subsequent change in the list of
authorized representatives must be reported immediately and authenticated
specimen signatures of new representatives must also be provided; and
ȕ conditions for withdrawal (i.e., disbursement conditions [Appendix 3A]),
if specified in the loan agreement, were met as appropriate.
Eligible and Ineligible Expenditures
4.7  ADB will only finance eligible expenditures (Appendix 4C). Expenditures eligible for
financing are generally detailed in the loan agreement (e.g., attachment to Schedule 3,
allocation and withdrawal of loan proceeds, also referred to as the “allocation table”)
and the PAM.
Disbursement Percentage and Financing Percentage
4.8  The disbursement percentage6
is the ratio or proportion of ADB financing
7
which is
applied to expenditure claimed under a particular expenditure category, as specified
in the allocation table or other part of the loan agreement.
4.9  The disbursement percentage in the allocation table is derived from ADB’s financing
percentage as presented in the detailed cost estimate by financier provided in the PAM.
Disallowances and Nonpayments
4.10  Where ADB disallows or adjusts the amount of withdrawal the borrower requested,
ADB sends an advice in writing by fax, email, or other means such as the Loan
Financial Information System website (Chapter 14) to the borrower and/or EA citing
4
The reference to Schedule 3 of the loan agreement in this handbook also means similar schedule as provided
in the grant agreement or the financing agreement.
5
Refer to ADB’s Procurement Guidelines (2010, as amended from time to time) and Guidelines on the Use of
Consultants (2010, as amended from time to time).
6
Formerly, this was also called the “percentage for ADB financing” or “percentage and basis for withdrawal
from loan account.”
7
It also applies to external funding sources administered by ADB.