The World Bank is not actually a bank in the traditional sense. Instead, it's a group of organizations. The term "World Bank" generally refers to the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), whereas the World Bank Group is used to refer to the institutions collectively. The World Bank is a component of the World Bank Group, and a member of the United Nations Development Group. The Bank came into formal existence on December 27, 1945.
The job of the World Bank is to help developing nations. Areas of assistance include health, education, rebuilding, agriculture, water, economics and stabilizing government. The World Bank has 10,000 employees in 109 countries and is based in Washington, D.C.
The primary difference between the World Bank and the International Monetary Fund, or IMF, lies in their respective purposes and functions. The the World Bank's goal is to reduce poverty while the IMF exists primarily to stabilize exchange rates. Both are institutions in the United Nations system. They share the same goal of raising living standards in their member countries.
The World Bank's money comes from a number of different sources. The International Bank for Reconstruction and Development (IBRD), which provides loans to middle-income countries and to poorer countries able to repay loans at terms based on market rates, raises most of its funds on the world's financial markets by selling World Bank bonds to investors.
During fiscal year 2013, The World Bank Group* provided $10.2 billion in low-interest loans, interest-free credit and grants to low-income countries. The region’s growth is expected to reach 2.8 percent in 2013, 3.8 percent in 2014, and 4.2 percent in 2015. The World Bank also provides technical expertise. The bank says it funds more education programs than any other outside government or agency and more AIDS/HIV education than anyone else. The World Bank is a major source of funding for combating AIDS in poor countries. In a recent six year period, it committed about $2 billion through grants, loans and credits for programs to fight HIV/AIDS.
A board of executive directors oversees day-to-day operations while it’s headed by the bank president. By tradition, the United States, the largest shareholder in the bank, names the World Bank president. The nominee is subject to confirmation by the Board of Governors and serves a five-year, renewable term. The World Bank has 24 executive directors. Of the 24, five are selected, one each, by France, Germany, Japan, the United Kingdom and the United States with the other 19 elected by country groups every two years. The World Bank has 184 member nations. Each has a role in policy and how money is spent.
The five agencies of the World Bank are:
- International Bank for Reconstruction and Development (IBRD)
- International Development Association (IDA)
- International Finance Corporation (IFC)
- Multilateral Investment Guarantee Agency (MIGA)
- International Centre for Settlement of Investment Disputes (ICSID)