DPL2

TERMS:
o The Borrower selected a US denominated, Commitment-linked IBRD
o Flexible Loan with a variable spread, with level repayments on June 1 and December 1 of each
year, with a Grace Period of 10 years and a Final Maturity of 25 years, with all conversion
options selected.
o The Front EndFee and the Premia for Interest Rate Caps and Collars will be capitalized.
o The Lending Rate for the Loan would be US$ 6 month LIBOR + variable spread (resets every 6
months). The Lending Rate would be approximately:
0.344% (US$ 6 month LIBOR) + 0.47% (variable spread) = 0.814% based on today's rates.


PROPOSED QUICK-DISBURSING BUDGET SUPPORT OPERATION
This document describes a proposed US$500 million Supplemental Financing to the second operation in
the programmatic development policy lending series (DPL2). The Philippines DPL series, launched in
2011, aims to support the Governments objective of fostering more inclusive growth. The proposed
Supplemental Financing to the DPL2 will assist in addressing the unanticipated financing gap caused by
the unprecedented magnitude of the typhoon which could jeopardize the Government's reform
program.

A new investment operation to support medium-term reconstruction needs. Based on the
Governments reconstruction plans, still to be defined, the Bank could prepare a new investment or
results-based (Program for Results) operation to support post-recovery and reconstruction efforts by
national and local governments. A typical package could include financing of: (i) critical infrastructure
and lifelines such as water supply, sanitation, roads, electricity transmission, or temporary housing; (ii)
reconstruction of and retrofitting to new standards of public buildings (e.g. schools, hospitals,
emergency response facilities); (iii) livelihood restoration; and (iv) restoration of urban and rural housing
and settlements, including through voucher grant financing to poor and vulnerable households.

In parallel, the Bank will continue to provide technical assistance to manage the risk from natural
hazards and future catastrophic events. It would achieve this through: (i)\ prioritization and retrofitting
of key public buildings (schools and hospitals) and utilities (water, gas, electricity supply and distribution
infrastructure); (ii) improving the preparedness and capacities for disaster risk management and
response; 12 (iii) strengthening risk-informed land use and development planning at the disaster-prone
LGUs; (iv) enhancing disaster risk financing capacity through support to the institutional strengthening
and contingent liability risk transfer tools in order to achieve fiscal resilience in times of calamity.

The IFC is also ready to provide advisory and financing support for the private sector. The IFC is in
contact with its client banks (universal banks, thrift/rural banks, and microfinance institutions) to
develop specific programs to facilitate private sector recovery. Financing facilities including risk share
facilities and advisory services could be extended to private sector banks in order to help small and
medium size companies in the affected areas recover. IFC is also reaching out by extending financing to
power transmission and generation companies to repair damage caused by the typhoon, as well as for
rebuilding of hotel and retail facilities in the affected areas.

World Bank
(IBRD)
Bangko Sentral
ng Pilipinas in
US $
Tranferred to
Government
Account
Available to
Finance
Budgeted
Expenditures
Account in
Philippine
General Fund
Borrower's
Budget System
in PH
Fund Now
Available for
Budget
Expenditures
Written
Confirmation
of Accounting
Completion to
WB
IFC is also planning to conduct an Emerging Market Mapping and Analysis (EMMA). This is a market
analysis to determine the best approach for humanitarian groups to carry out emergency responses as
well as determine the appropriate delivery of investments or advisory services to restore private sector
activities.

For instance, the DOF has been working with the Bank on catastrophe risk modeling. The model can
evaluate options for risk transfer (e.g., insurance, catastrophe pool) in order to minimize and efficiently
manage the fiscal burden of disaster impacts.


FUNDS FLOW AND AUDITING REQUIREMENTS FOR THE SUPPLEMENTAL FINANCING
The proceeds from the loan will be deposited into a deposit account in US dollars at the Central Bank or
Bangko Sentral ng Pilipinas (BSP). The equivalent local currency amount will immediately be transferred
to an account of the government available to finance budgeted expenditures. After disbursement of the
loan, the Government will ensure that the equivalent Peso amount of this loan amount is promptly
accounted for (in Philippine Pesos) in the Borrowers budget system in the General Fund, and thereby be
available to finance budgetexpenditures. The Borrower will provide to the Bank a written confirmation
that this accounting has been completed.

Disbursement of the loan will not be linked to any specific purchases and no procurement requirements
have to be satisfied. The proceeds of the operation would not be used to finance expenditures excluded
under the Loan Agreement. If, after being deposited in a government account, the proceeds of the loan
are used for ineligible purposes as defined in the Loan Agreement, the Bank will require the Borrower to
refund the amount directly to the Bank.











(KALAHI-CIDSS National Community Driven Development Project)

Part 1. Barangay (Community) Sub-Grants for Planning and Investment
(a) Provision of Sub-grants to beneficiary Barangays to: (i) carry out specific
activities for the orientation, consultation, participatory priority-setting, action planning,
review and approval of Sub-projects at Barangay and inter-Barangay (municipal) levels,
including the provision of technical assistance to ensure the quality of design and
development of community infrastructure, facilities, services and other priority activities
identified by communities; and (ii) develop and/or improve community-identified priority
infrastructure, facilities and services and other priority activities identified by
communities, including activities in response to an Eligible Crisis or Emergency, as
needed.
(b) Provision of training and other technical support to strengthen the
capacity of community volunteers to facilitate the implementation of Sub-projects.
Part 2. Local Capacity Building and Implementation Support
Carrying out of specific activities to strengthen the capacity of local government
units and area coordination teams to conduct poverty reduction action planning, budget
execution and public financial management, including to facilitate and oversee the
planning and implementation of Sub-projects; carrying out of specific activities to
strengthen the capacity of relevant sector and sub-national units and staff of national
government agencies to enhance their community based activities; and review and
revision of legal instruments, policies and guidelines to integrate and mainstream
community-driven development principles.
Part 3. Project Administration, Monitoring and Evaluation
Carrying out of the day-to-day coordination, administration, procurement,
financial management, environmental and social management; communication and
dissemination of information to sensitize stakeholders to the Project's objectives,
strategies and lessons learned; monitoring, evaluation and audit of the Project at the
national, regional and sub-regional levels, including the carrying out of relevant studies-6-
for the purposes of the Project such as reviews of the technical quality of infrastructure,
economic rates of return on investments, process monitoring of procedural variations in
different contexts (conflict, disasters, indigenous populations), and analyses of outcomes
of different methodological approaches; and provision of operational assistance to
regional and municipal offices of DSWD in disaster affected areas to reestablish
operational capacity.