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.
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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
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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)
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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
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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).
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Related illustrative tables are also
provided in this handbook (Appendix 3B).

This Ingenious Machine Turns Feces Into Drinking Water

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The loan agreementis an agreement between ADB and a borrower and sets out
the loan’s terms and conditions.
ȕ A guarantee agreementis an agreement between ADB and a borrowing member
country as guarantor of the loan when ADB lends directly to a nonmember entity.
ȕ A project agreementis an agreement between ADB and the project executing
agency (EA) or implementing agency of the borrower specifying requirements
related to, among other things, physical implementation of the project,
procurement provisions, and financial aspects, including the maintenance of
project financial statements and audit arrangements.
Loan Milestone Event Dates
3.6  Major loan milestone event dates include the following:
ȕ The approval dateis the date the loan is approved by ADB’s Board of Directors.
This date is also used for determining the loan amortization schedule as shown
in Schedule 2 of the loan agreement. For a loan under a multitranche financing
facility (MFF), the approval date is the date the subproject or loan is approved
by Management.
ȕ The signing dateis the date the loan agreement is signed by the borrower and
ADB. For ordinary capital resources loans, commitment charges will start to
accrue on the 60th day after the loan signing date.
ȕ The effective dateis the date when ADB advised the borrower that all conditions
of effectiveness of the loan agreement have been fulfilled by the borrower and
disbursements may be made from the loan account (Section 4.6).
ȕ The project completion dateis the date on which the project is considered
physically completed. This date precedes the loan closing date (normally
6 months before).
ȕ The loan closing dateis the date ADB may terminate the right of the borrower
to make withdrawals from the loan account. Expenditures incurred after the
loan closing date will not be financed under the loan (see Sections 4.15–4.24 for
matters related to loan closing).
Retroactive Financing
3.7  Retroactive financing is the financing of project expenditures incurred by the borrower
before a loan agreement becomes effective.
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3.8  ADB may approve retroactive financing, at the borrower’s request, to finance
expenditures incurred prior to loan effective date but generally no earlier than
12 months before signing the loan agreement. A period longer than 12 months may be
allowed if justified in the RRP.