Private/Public and Sovereign/Sovereign-guaranteed lending publications are out.
Press release, FAQs on GEMs institutional developments and new report on investor perceptions of GEMs are out.

Global Emerging Markets

Risk Database Consortium

Leveraging data from Multilateral Development Banks and Development Finance Institutions to support investment and development

IN THE SPOTLIGHT

News

BDEAC joins the GEMs Consortium

GEMs is delighted to announce that BDEAC has joined as a new member in October 2024.

Two new publications with granular statistics are out

GEMs has made available to the public two new publications, showcasing default and recovery statistics disaggregated per country, sector and region/sector combinations.

DBSA joins the GEMs Consortium

GEMs is delighted to announce that DBSA has joined as a new member in June 2024.

The first publication with the recovery rates is out

GEMs has now made available its first publication with recovery statistics for private and public counterparts.

CDP joins the GEMs Consortium

At the occasion of the GEMs Working Groups Annual Meeting, on February 2024

The new publications with the default rates are out

GEMs has now made available to the wider public an updated version of its credit default statistics for private and public counterparties and for the  sovereign counterparties

Proparco joins the GEMs Consortium

At the occasion of the GEMs Annual Meeting, on November 2023

NDB joins the GEMs Consortium

At the occasion of the GEMs Virtual Working Group Annual Meetings, on February 2021

CABEI joins the GEMs Consortium

At the occasion of the GEMs Virtual Annual Meetings, on September 2020

IBRD joins the GEMs Consortium

At the occasion of the World Bank-IMF Spring Meetings in Washington, DC, on April 20

MIGA joins the GEMs Consortium

At the occasion of the GEMs Steering Committee Meeting in Washington, D.C., on 19 October 2019

IFAD joins the GEMs Consortium

GEMs is pleased to welcome IFAD as a new member in 2018

BOAD joins the GEMs Consortium

GEMs is pleased to welcome BOAD as a new member in 2018

Events

New publications launched in Washington, D.C.

GEMs publications with new granular statistics were presented during the WBG Annual Meetings in October 2024

GEMs 2024 General Assembly Annual Meeting in Tokyo

GEMs Consortium members gathered for 3 days of productive exchanges and technical discussions, also addressing the upcoming publications.

GEMs 2024 Working Groups Annual Meeting in Bogotá

The GEMs Team coordinated a four-day event in Bogotá, providing insights into the upcoming publication and its results and engaging participants in methodological discussions and technical exchanges

GEMs 2023 General Assembly Annual Meeting in Cairo

The GEMs Team arranged a 3 days event in Cairo involving technical knowledge exchanges, discussions, and social gatherings

GEMs 2023 General Assembly Annual Meeting in Cairo

The GEMs Team arranged a 3 days event in Cairo involving technical knowledge exchanges, discussions, and social gatherings

GEMs 2023 Rome Working Groups Annual Meeting

3 days meeting in which the GEMs’ consortium discussed and shared its views on various topics.

GEMs 2022 Luxembourg General Assembly Annual Meeting

3 days of discussions, exchanges and social events organized by the GEMs Team

GEMs 2022 Virtual Working Group Annual Meetings

2 days of virtual technical exchanges and inter-institutions team building organized by the GEMs Team

GEMs 2021 Virtual General Assembly Annual Meetings

3 days of discussions, collaboration forum and inter-institutions team building organized by the GEMs Team

GEMs 2021 Virtual Working Group Annual Meetings

5 days of virtual technical exchanges and inter-institutions team building organized by the GEMs Team

GEMs 2020 Working Group Annual Meetings in Côte d'Ivoire

Hosted by the African Development Bank (AfDB) in February 2020

GEMs 2019 General Assembly Annual Meetings in Moscow

Hosted by the International Investment Bank (IIB) in July 2019

Celebrating 10 Years of GEMs Collaboration in Luxembourg

GEMs Working Group Annual Meetings hosted by the European Investment Bank (EIB) in January 2019

Miscellaneous

Report on investor perceptions of GEMs is out

GEMs has made available to the public the new report which provides an in-depth analysis of investor perception of GEMs. It highlights the market demand for, and potential uses of, current GEMs credit statistics. Additionally, the report suggests new statistics that GEMs could develop to better serve the needs of the private sector.

IFC research note is out

The note reassess risk in emerging market lending using data from the GEMs consortium.

International Fora

GEMs participates at Hamburg Sustainability Conference

First-ever HSC unites policymakers and business leaders to accelerate SDG performance, with GEMs participating in discussions on data and risk pricing

GEMs presents its product offering at SOS Meeting in Helsinki

MDBs address restructurings of special operations with GEMs presenting the consolidated performance of its statistics

GEMs participates at SDG Impact Finance Initiative Event in London

Discussion on scaling up impact investing in developing markets and addressing the perception of risk and lack of liquidity

Finance In Common: GEMs in a new public database

GEMs is a key consortium in the new development banks database by AFD and Peking University

GEMs participates in the Paris Peace Forum 2020

GEMs was one of the project selected on the Multilateral Data Collaboration to Support Emerging Markets

GEMs participates in G20 IWG infrastructure discussion in Moscow

PRESS RELEASE

New publications by GEMs Consortium offer further insights into emerging market credit risk

Two new publications by Global Emerging Markets Risk Database (GEMs) Consortium provide granular default and recovery patterns for over three decades of development finance, and highlight the key drivers of investment risk in emerging markets and developing economies (EMDEs).

Luxembourg, October 15, 2024 — Two new publications released today by the GEMs Consortium – a group of 26 multilateral development banks (MDBs) and development finance institutions (DFIs) – provide further insights on the level of credit risk in EMDEs according to the investment experience of Consortium members.

The first publication covers the credit performance of lending to private and public counterparts. The average annual default rate of lending to private entities at 3.56% is broadly aligned with many non-investment grade firms in advanced economies, and the average recovery rate of 72.2% is higher than many global benchmarks. Although the GEMs statistics reflect the unique experience of MDBs and DFIs, these results provide valuable information on the investment risk in EMDEs, an area characterized by a lack of available credit risk data.

The second publication provides default rates and – for the first time – recovery rates for sovereign and sovereign-guaranteed lending based on an expanded range of 40 years of data. Results shows an average annual default rate of 1.06% and an average recovery rate of 94.9% and complement the GEMs statistics on private and public counterparts to provide a comprehensive view on EMDEs credit risks.

These increasingly granular statistical publications by the GEMs Consortium address the call by the G20 and other stakeholders to provide investors greater insights into credit risks in emerging markets, thereby allowing them to better guide their asset allocations. The new publications provide statistics at the country and sector level, as well as a range of newly introduced metrics.

“The availability of credit statistics is critical to mobilizing more private investment into emerging markets and developing economies by helping investors better understand the risk profile of such investments,” said Román Escolano, Group Chief Risk Officer, European Investment Bank. “The updated publications, with greater disaggregation and analysis, address feedback from our key stakeholders, and GEMs plans to continue publishing such statistics in a timely manner.”

EMDEs generally receive less investment than advanced economies. At the same time, developing countries need $4 trillion of annual investment to achieve the Sustainable Development Goals by 2030, and $2.8 trillion of annual clean energy investment by next decade to meet both rising energy demands and climate targets.

“The GEMs statistics challenge the conventional view that emerging markets are high-risk destinations for investment,” said Federico Galizia, Vice President, Risk and Finance, International Finance Corporation. “With 30 years of default frequencies and recovery rates, and now even further levels of disaggregation, GEMs shows that emerging market investments should be within the risk appetite of a broad range of investors.”

The GEMs publications include default and recovery rates for over three decades of lending by Consortium members to private, public, and sovereign borrowers. The disclosed historic default and recovery rates can be used by investors and credit rating agencies to refine their risk assessment and asset allocation, and provide a useful benchmark for risk and pricing models. Both new publications are available on the GEMs website (www.gemsriskdatabase.org).

About GEMs

Global Emerging Markets Risk Database (GEMs) Consortium is one of the largest credit risk databases for the emerging markets operations of its member institutions – multilateral development banks and development finance institutions. It pools anonymized data on credit defaults on the loans extended by Consortium members the migrations of their clients’ credit rating and the recoveries on defaulted projects in emerging markets and developing economies, thus providing an insight into geographies that are otherwise relatively poorly served in terms of empirical credit information.

GEMs was established in 2009 as a bilateral initiative between the European Investment Bank and the International Finance Corporation (World Bank Group). Since then, the GEMs Consortium has grown to include 26 members: African Development Bank (AfDB), Agence Française de Développement (AFD), Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), Black Sea Trade and Development Bank (BSTDB), Banque Ouest Africaine de Développement (BOAD), British International Investment (BII), Council of Europe Development Bank (CEB), Central American Bank for Economic Integration (CABEI), European Bank for Reconstruction and Development (EBRD), European Investment Bank Group (EIB), GuarantCo, Inter-American Development Bank (IDB), Inter-American Investment Corporation (IDB Invest), International Finance Corporation (IFC), International Bank for Reconstruction and Development (IBRD), International Fund for Agricultural Development (IFAD), Islamic Development Bank (IsDB), Kreditanstalt für Wiederaufbau (KfW), Multilateral Investment Guarantee Agency (MIGA), Netherlands Development Finance Company (FMO), U.S. International Development Finance Corporation (DFC), New Development Bank (NDB), Proparco, Cassa Depositi e Prestiti (CDP) and Development Bank of Southern Africa (DBSA).

FAQs

This section provides answers to the most common questions about GEMs institutional developments ant its products.

ABOUT US

GEMs, the Global Emerging Markets Risk Database, is one of the world’s largest credit risk databases for the emerging markets operations of its member institutions, that are Multilateral Development Banks (MDBs) and Development Finance Institutions (DFIs). It pools data on credit defaults on the loans extended by consortium members, the migrations of their clients’ credit rating and the recoveries on defaulted projects.

GEMs was established in 2009 as a joint initiative between the European Investment Bank (EIB) and the International Finance Corporation (IFC – World Bank Group). Since then, the GEMs consortium has grown to include all major MDBs and DFIs worldwide.

The Consortium members contribute anonymized data on their projects’ credit events notably in emerging markets and developing economies. In return, members gain access to aggregate GEMs statistics on observed default rates, rating migration matrixes and recovery rates by geography, sector, time-period and various other dimensions.

GEMs statistics thus provide members with an insight into geographies that are otherwise relatively poorly served in terms of empirical credit information.

Institutions

Years of data

Counterparts

Contracts

For lower income countries, fragile and conflict states and frontier markets, GEMs in many cases contains the most exhaustive database of credit data, both in number of data points and length of coverage. The consortium members apply the GEMs statistics in their various internal risk management processes, such as benchmarking, provisioning estimates, probability of default (PD) and loss given default (LGD) models calibration, regulatory and economic capital calculations and the validation on PD & LGD assumptions.

OUR GUIDING PRINCIPLES

Cooperation

GEMs is not only a data-driven cooperation among peer institutions but also offers a forum for discussion and exchange among experts. It is a concrete example of how MDBs and DFIs can work together as a system to collectively achieve more than they could do alone – improving risk management practices across the IFI industry by exchanging on methodology topics and pooling data.
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Confidentiality

The GEMs cooperation is based on a strict confidentiality agreement. The consortium has jointly developed an anonymized data collection process and methodology which supports the protection data confidentiality and allows for the generation of  output statistics on the consortium level.

Data Quality

The GEMs methodology and data process, developed over more than 10 years now, ensures data harmonisation and a high level of data quality. The complete GEMs historical dataset is submitted annually leading to updates to previous data and addition of new data. Thus, over time, data quality continuously improves.

DATA COLLECTION AND REPORTING

GOVERNANCE

Steering Committee

The Steering Committee, co-chaired by the European Investment Bank Group and the World Bank Group, represents the interests of the members and defines the strategic and operational priorities. Additionally, the Steering Committee decides on the admission of any additional member institutions into the consortium. The Steering Committee currently is comprised of seven multilateral development banks: European Investment Bank (EIB), International Finance Corporation (IFC), International Bank for Reconstruction and Development (IBRD), African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD) and Inter-American Development Bank (IDB).

Román Escolano

Román Escolano

Group Chief Risk Officer, European Investment Bank
Lakshmi Shyam-Sunder

Lakshmi Shyam-Sunder

Vice President and Chief Risk Officer, World Bank Group
Federico Galizia

Federico Galizia

Vice President, Risk and Finance, International Finance Corporation
Rachel Robboy

Rachel Robboy

Chief Risk Officer,
Inter-American Investment Corporation
David Coleman

David Coleman

Vice President, Chief Risk Officer​, European Bank for Reconstruction and Development
Stephen O'Leary

Stephen O'Leary

Head of Office of Risk Management, Asian Development Bank
Ifedayo Orimoloye

Ifedayo Orimoloye

Group Chief Risk Officer, African Development Bank

SECRETARIAT

GEMs Secretariat

The Consortium has entrusted the European Investment Bank (EIB) to perform the functions of GEMs Secretariat. GEMs Secretariat is hosted by the European Investment Bank (EIB) and is formed of GEMs Secretary General and several staff members. It facilitates the workflows of the Consortium and coordinates the collaboration with the member institutions. GEMs Secretariat maintains the data submission templates, documentation framework and credit risk methodologies, and coordinates their evolutions in close collaboration with member institutions’ delegates. It steers the production of the Consortium’s internal reports and publications, and oversees the development of the GEMs Webtool, which hosts the database and allows member institutions’ delegates to perform statistical queries. GEMs Secretariat also facilitates the cooperation within the member institutions by organising annual meetings for the general assembly and working groups and running working group activities throughout the year. Moreover, it provides support to the member institutions’ delegates on questions related to the application of the output statistics, provides advice and decision support services to the GEMs Steering Committee, and implements the further development of GEMs according to the Steering Committee’s guidance.
Gregor Cigüt

Gregor Cigüt

GEMs Secretary General (act.)

Head of Unit, EIB
Frank Sperling

Frank Sperling

GEMs Secretariat

Senior Consultant, EIB
Amine Amesrouh

Amine Amesrouh

GEMs Secretariat

Consultant, EIB
Pierre-Alexandre Robert

Pierre-Alexandre Robert

GEMs Secretariat

Consultant, EIB

Membership

Representatives of the member institutions of the consortium, meet twice a year: at the beginning of the year for a Working Group Annual Meeting and mid-year for a General Assembly Annual Meeting. The General Assembly consists of risk management professionals from the respective member institutions and is concerned with the technical developments around data collection and application of GEMs output statistics, methodology, reporting and other developments as guided by the GEMs Steering Committee. The member institutions of the consortium currently include:

They talk about GEMs:

“GEMs is the jewel of the international development banking community. (…) I’m convinced that the participation of IBRD, as part of the World Bank Group, will further strengthen our cooperation to achieve the objectives set by the UN in the field of the Sustainable Development Goals” –Werner Hoyer, President of the European Investment Bank (EIB)

Full article on the EIB website

They talk about GEMs:

“GEMs fulfills a vital role in overcoming informational hurdles. High-quality data must be readily available, accessible and standardized for an adequate assessment of risks to spur cross-border investment in EMDEs. I am very happy that IBRD is joining the consortium.” –Joaquim Levy the Managing Director and Chief Financial Officer of the World Bank

Full article on the World Bank website

They talk about GEMs:

Introductory Guide to Infrastructure Guarantee Products from Multilateral Development Banks: “A possible way around the scarce historical data is to use MDBs’ portfolio information. In this regard (…) A study comparing infrastructure projects’ PD and LGD from GEMs database to those obtained from commercial datasets could provide further evidence of the halo effect …”

Full publication on the IDB website

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Membership eligibility criteria

As outlined in the GEMs Cooperation Agreement,  the GEMs membership is currently limited to:

– Entities within or funded by the public sector (such as MDBs) which have as their role and function the financing and development of emerging markets and are International Financial Institutions established by treaty.

If you’d like to inquire about the membership, please contact the GEMs Secretariat via the form below. The final decision on applications for membership will be made by the GEMs Steering Committee.

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You are an eligible institution? Why should you join GEMs?

To have access to the GEMs database webtool

That enables to clean, update and analyse your data and the consortium overall data as well as calculate credit default rates, recoveries and rating migrations.

To receive the GEMs Annual Report

Which presents the latest credit risk statistics calculated out of the most recent available data set

To benefit from the GEMs User Guide

Which presents the latest credit risk statistics calculated out of the most recent available data set

To receive guidance on data and methodology

From  the GEMs Secretariat on your own data set and the application of the GEMs statistics in your internal risk management processes

To Network and stay up-to-date

On the most recent discussions on IFI risk management best practices during regular working groups calls and bi-annual in-person meetings

Default and recovery statistics- Private and public lending

GEMs default statistics publication on private and public lending 1994-2023

Default and Recovery Statistics for private and public lending for the period 1994 – 2023 discloses for the first time:
(i) default and recovery statistics in a single report, as opposed to separate reports previously;
(ii) disaggregation of statistics by countries, granular sector cuts, and region/sector combinations, not available in previous reports;
(iii) statistical quantities such as medians and distributions, in addition to averages reported previously.

GEMs is pleased to make its Private and public lending publication freely available. Please just fill the form below to download the report. We look forward to receiving feedback from the readers and working with the stakeholders to improve the focus and content of the future reports.

Default and recovery statistics- Sovereign and sovereign-guaranteed lending

GEMs default statistics publication on sovereign and sovereign guaranteed lending 1984-2023

Default and Recovery Statistics for sovereign and sovereign guaranteed lending for the period 1984-2023 discloses for the first-time:
(i) statistics derived from 40 years of pooled data, which is more than a decade more than previously; (ii) recovery statistics;
(iii) statistical quantities such as medians and distributions, in addition to averages reported previously.

GEMs is pleased to make its Sovereign and Sovereign-guaranteed publication freely available. Please just fill the form below to download the report. We look forward to receiving feedback from the readers and working with the stakeholders to improve the focus and content of the future reports.

Articles

Reassessing Risk in Emerging Market Lending: Insights from GEMs Consortium Statistics

Federico Galizia and Susan Lund[1]


[1] International Finance Corporation. Federico Galizia is Vice President, Risk and Finance. Susan Lund is Vice President, Economics and Private Sector Development. Contributions by Rapti Goonesekere, Paolo Mauro, Cesaire Meh, Florian Moelders, Mohammed Saleh are gratefully acknowledged.

Master Scale

GEMs reference probabilities of default (PD) curve known as the GEMs master scale
The GEMs master scale is the common language regarding the creditworthiness of GEMs member institutions’ lending counterparties (borrowers): it is a 1-year Probability of Default (PD) rating scale built partially based on GEMs observed default rates.

Disclaimer

Neither GEMs nor any GEMs consortium member or their respective constituents represents or warrants as to the accuracy, reliability or completeness of the content included in this work, or for the conclusions or judgments described herein. Moreover, neither GEMs nor any of its members shall have any responsibility or liability whatsoever to any recipient or to any other party in connection with or arising in any way from such content, conclusions or judgments, or for any omissions or errors (including, without limitation, typographical errors and technical errors) included therein or for reliance thereon. Neither GEMs nor any GEMs consortium member or their respective constituents has an obligation to independently verify the information upon which the work is based, or to update the work for any reason including in the event of changes in that underlying information.

The contents of this work are intended for general informational purposes only. This work and its contents shall not constitute and should not be construed as an offer, a guarantee, an opinion regarding the appropriateness of any investment, or a solicitation or invitation of any type. This work and its contents are not intended to provide, and should not be relied on as providing, financial, accounting, legal, securities, investment or any other type of advice.

Contact

Get in touch with the GEMs Secretariat:

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