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In recent years, bilateral aid channeled through multilateral organizations like the World Bank has become an important vehicle for concessional finance for development. At the end of FY09, the World Bank held USD 23.9 billion in trust, an amount that has doubled since FY05. While much of the growth reflects the increase in large Financial Intermediary Funds (FIFs), there has also been a rapid increase in Recipient Executed Trust Funds (RETFs). This paper aims to inform internal Bank audiences and stimulate discussion on some selected issues - primarily the growing importance of RETFs as a source of finance and relevance to Bank's country level operations. The report also examines briefly the link between RETF allocations and country performance. The report finds that disbursements of RETFs grew by twenty percent over FY03-FY09. Over this period the trends in regional disbursement shares shifted away from East Asia and Pacific and South Asia Regions to Africa Region. Recipient country concentration is evident: fifty percent of the disbursements have been from six countries - Afghanistan, West Bank and Gaza, Ethiopia, Vietnam, Indonesia and China. RETF disbursements, as a share of the combined International Bank for Reconstruction and Development (IBRD), International Development Association (IDA), and RETF, grew from five percent in FY03 to twelve percent in FY08, while that of IBRD and IDA fluctuated. The bulk of the disbursements from RETF grants were from IDA eligible countries. RETFs appear to have substituted for IDA in fragile and conflict affected states. Disbursements from RETF grants and IDA credits were broadly aligned by sector. There may be some correlation between RETF grants allocation and country performance but the results are not conclusive. The report identifies some areas for further examination: whether RETFs should complement or substitute for Bank operations in specific cases; and whether RETF allocations should be made on the basis of some need or performance based country priorities, outcomes and results.

Access to Finance --- Accounting --- Advisory Services --- Aid Effectiveness --- Bankruptcy and Resolution of Financial Distress --- Capacity Building --- Country Assistance Strategies --- Debt --- Debt Markets --- Development Economics & Aid Effectiveness --- Finance and Financial Sector Development --- Financial Crisis --- Financial Services --- Governance --- Human Resources --- International Finance --- International Governmental Organizations --- Jurisdiction --- Macroeconomics and Economic Growth --- Nutrition --- Official Development Assistance --- Operating Costs --- Social Development --- Technical Assistance --- Transport