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Business executive Ajay Banga took over as president of World Bank Group on Friday — officially becoming the first Indian-American and South Asian to hold the post.
His leadership for a five-year term comes as the bank pivots to face climate change, a crucial transition that the former Mastercard chief sees as closely tied to vanquishing inequality -- and he has big plans for the private sector's role in that task.
Born into a Sikh family in the Indian city of Pune, in the state of Maharashtra, Banga is a naturalised US citizen. The 63-year-old grew up in different parts of the country due to his father's job as an army officer, before starting out at the Indian subsidiary of Nestle in the early 1980s.
He went on to have a successful business career in India, and later relocated to the United States.
Banga ran the payments company Mastercard for more than a decade between 2010 and 2021, and has also served on the boards of the American Red Cross, Kraft Foods and Dow Inc. More recently, he was vice chairman at private equity firm General Atlantic.
His expertise in finance and development will play a key role for the bank as it realigns to face the challenge of a warming planet. Nominated by US President Joe Biden, the Indian-born finance and development expert was the sole contender for the job.
US Treasury Secretary Janet Yellen on Thursday told Banga to "get the most out of the bank's balance sheet" and mobilise more private capital for climate finance and global development objectives.
In a meeting a day before the executive took office, Yellen "conveyed her strong desire for Treasury to continue close collaboration" with him on the lender's evolution to address climate change and other global challenges.
That includes continuing to implement recommendations from last year's G20 report on capital adequacy, which argued that changes to multilateral development banks could unlock hundreds of billions of dollars in new lending.
Under Banga's predecessor, Malpass, the bank's shareholders in April approved an initial round of balance sheet changes to boost lending by $50 billion over 10 years while maintaining its top-tier AAA credit rating. But Yellen has insisted that further lending reforms and other changes be made on a "rolling basis" in coming months.
Yellen said continuing to implement these reforms would "get the most out of the Bank's balance sheet," and mobilise more private capital "for our shared development objectives and to refine the operating model to increase the responsiveness and agility of the bank," the Treasury said.
She also said the World Bank needed to work more closely with its sister development banks.
"Secretary Yellen stressed the need to support the poorest of the banks' member countries as they continue to face multiple crises, including continuing global macroeconomic headwinds exacerbated by Russia's war in Ukraine," the Treasury added.
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