2011 OPIC ANNUAL REPORT 1

3 LETTER FROM 

THE PRESIDENT

4 INTRODUCTION

7 BY THE NUMBERS

10 OPIC AT 40

12 PRIORITIES

18 CLIENTS

24 REGIONS

30 DEVELOPMENT 

IMPACT RESULTS

32 INVESTMENTS

38 COUNTRIES

39 FINANCIAL STATEMENTS

TABLE OF CONTENTS

INVESTING WITH 

IMPACT FOR 40 YEARS


4 2011 OPIC ANNUAL REPORT

The challenges facing the developing world today are great, far greater than any government or 

nonprofi t entity can address on its own. Since 1971, OPIC has been making a major diff erence in 

developing countries and post-confl ict regions by leveraging private sector capital, and off ering 

innovative fi nance and insurance tools to encourage investment in emerging markets. OPIC’s loans, 

guaranties, political risk insurance and support for investment funds have helped improve access to 

food, housing, health care, fi nancial services and clean energy around the world. The agency’s support 

of infrastructure projects has laid the foundation for future growth and stability, turning isolated regions 

into U.S. trading partners and markets for American goods and services.

OPIC’s development fi nance model is as effi cient as it is eff ective. Operating out of Washington, D.C. 

with a staff of just 205, OPIC has projects in 107 countries. In fi scal year 2011, the agency invested in 

projects from Cambodia to India, Peru, Haiti, Kenya, Egypt and Jordan, in sectors from solar power to 

construction, agriculture, housing and small business lending. By partnering with the private sector, 

OPIC can do more with less, and achieve a powerful multiplier eff ect. From off ering long-term lending 

to protecting against the risks of political instability, OPIC fi nance and insurance products are uniquely 

tailored to assist the private sector in some of the world’s most challenging places.

This year, the occasion of marking OPIC’s 40th anniversary, reminds us that OPIC’s development 

fi nance model endures in a world where the political landscape has changed dramatically. Countries 

that once lacked basic infrastructure are now focused on expanding access to energy and health care, 

building low-income housing and supporting small businesses, and they are increasingly conscious 

of growing in a sustainable manner. Technology has transformed the way the world communicates, 

making it possible to connect with smaller businesses and communities in remote areas. And the 

political landscape has shifted many times in sudden and surprising ways, requiring a quick response to 

foster stability. Over those 40 years, OPIC has supported nearly $200 billion of investment in more than 

4,000 development projects in emerging markets. This development work has produced a number of 

positive byproducts. Since 1971, OPIC’s project commitments have supported $75 billion in U.S. exports 

and more than 276,000 U.S. jobs.

Each dollar of OPIC support has catalyzed, on average, almost $2.70 in private investment. New project 

commitments totaling $3.2 billion in fi nancing and insurance in 2011 brought OPIC’s portfolio to 

$14.5 billion. This means that OPIC’s small and dedicated staff manages the highest level of exposure 

per employee of any governmental or multilateral development fi nance institution in the world. Some 

of the world’s most successful companies boast about “profi t per employee.” OPIC’s 2011 profi t worked 

out to $1.3 million per employee.

OPIC: INVESTING WITH 

IMPACT FOR 40 YEARS

INTRODUCTION
2011 OPIC ANNUAL REPORT 5

A UNIQUE INSTITUTION

OPIC requires projects to be commercially 

viable and measurably developmental. OPIC 

will go the extra mile to devise the creative and 

accommodating structures often required for 

successful frontier investing.

Unlike private-sector lenders and insurers, OPIC 

can provide fi nancing with much longer terms, 

even beyond 20 years, particularly in challenging 

sectors such as infrastructure, water or power 

generation that need longer tenors. OPIC can 

also support a very wide range of projects with 

transaction sizes as small as $100,000 and as large 

as $400 million.

In providing its fi nancial products and services, 

OPIC complements, rather than competes with the 

private sector, explicitly avoiding any transaction 

that private markets could do on their own. At 

the same time, OPIC ensures that the projects 

it supports adhere to the most forward-leaning 

environmental, labor and human rights policies in 

the fi eld of development fi nance.

OPIC is mandated by its charter to be selfsustaining. The interest, fees, and premiums 

charged for its products enable OPIC to operate 

at no net cost to American taxpayers. In fact, OPIC 

has made money for the U.S. government for 

34 consecutive years. In fi scal year 2011, OPIC 

generated net income of $269 million.

RISING TO THE CHALLENGE

The events of 2011, a pivotal year in American 

foreign policy, demonstrated why the United 

States must take a strategic approach to foreign 

investment. We must invest in regions and 

projects where we can make a diff erence, and 

continuously monitor our investments to ensure 

they are working as designed. We must recognize 

that many new or emerging democracies present 

economic opportunities as well as economic 

and political challenges, and that all of our most 

formidable trade competitors are working to gain 

a foothold in these new and emerging markets. 

Photo by: Tu Xuong, CGAP Photo Contest Second Prize, 2011
6 2011 OPIC ANNUAL REPORT

economies by supporting U.S.-sponsored projects 

in renewable resources, including energy, water, 

forest sustainability, agriculture and bio-diversity. 

In addition, in one of the largest initiatives by the 

U.S. government to support international eff orts 

to mitigate climate change, OPIC approved nearly 

$500 million in fi nancing for fi ve new investment 

funds that could ultimately invest more than $1.5 

billion in the renewable resources sectors of 

South and Southeast Asia and Africa. OPIC also 

supported $1.1 billion in long-term fi nance and 

insurance for renewable resource projects in 2011, 

roughly triple the support provided in 2010. These 

commitments represented more than one-third 

of all U.S. Fast Start climate 

fi nancing targeted under 

the Copenhagen Climate 

Accord. A large portion 

of those commitments 

went to renewable energy 

projects. The combined 

728 megawatts of OPICsupported renewable generating capacity 

represented a ten-fold increase over the 

year before.

EXPANDING OPPORTUNITIES FOR 

U.S. SMALL BUSINESS

Small businesses are at the heart of America’s 

economy and provide two out of every three jobs. 

OPIC is committed to putting them at the heart of 

the global economy as well. Small fi rms are often 

best equipped to bring entrepreneurial skills and 

know-how to grassroots projects in the developing 

world. Projects with small business participation 

received nearly $1 billion in OPIC support in 2011 

and represented 78 percent of all new OPIC 

DELIVERING IMMEDIATE SUPPORT FOLLOWING 

THE ARAB SPRING

Immediately after the revolution in Tunisia, OPIC 

President Elizabeth Littlefi eld traveled to Tunisia 

and Egypt with Secretary of State Hillary Clinton 

to meet with the interim governments, youth 

groups, revolutionary leaders and civil society. 

Within just three months, OPIC progressed from a 

conversation in Cairo in which young people asked 

for help to create jobs, to OPIC Board approval of 

a $250 million small business lending facility that 

will do just that. This was only the fi rst project out 

of the $2 billion of OPIC support for the Middle 

East and North Africa pledged 

by Secretary Clinton during 

that visit. It was followed by 

approval of $150 million in 

fi nancing for investment in 

the region’s consumer goods, 

manufacturing and fi nancial 

services sectors through a 

guaranty to Citi (CitiBank). The Citi guaranty will 

cover a loan to an Egyptian private equity fi rm and 

$52.5 million in fi nancing with co-investors for the 

Maghreb Investment Fund in Tunis. These funds 

will eventually invest up to $250 million in small 

and medium-sized high-growth companies. 

President Obama later announced an additional 

$1 billion of new OPIC support specifi cally for 

private investment and job creation in Egypt.

SUPPORTING INNOVATIVE AND EFFICIENT 

USE OF ALL NATURE’S RESOURCES

OPIC is increasingly focused on helping 

developing countries make the transition to 

environmentally sustainable, lower carbon 

OPIC generated net income 

of $269 million in fi scal year 

2011, helping to reduce the 

federal budget defi cit for 

the 34th consecutive year.


2011 OPIC ANNUAL REPORT 9


12 2011 OPIC ANNUAL REPORT

INVESTING ACROSS DIVERSE SECTORS

In fulfi lling its statutory mandate to mobilize participation of U.S. 

private capital and skills in the economic and social development 

of low-income countries, OPIC places priority on projects that are 

most likely to stimulate local economies and contribute to sustained 

economic growth. Projects in energy — especially the growing 

renewable energy sector — and fi nancial services combined represent 

the most signifi cant share of OPIC’s $14.5 billion portfolio. Through 

project loans, guaranties and insurance, as well as debt fi nancing 

for privately managed investment funds, OPIC also invests in 

infrastructure, manufacturing, transportation, agriculture, health and 

education: sectors in which commercially sustainable projects can 

most broadly and effi ciently extend signifi cant developmental benefi ts.

ENCOURAGING USE OF 

RENEWABLE RESOURCES

Development of renewable resources is not only an urgent global need 

but also a signifi cant investment opportunity. Encouraging U.S. private 

sector investment in renewable resources and helping developing 

countries eff ectively transition to lower carbon economies are key 

areas of focus for OPIC.

In 2011, OPIC approved $1.1 billion in new support for the renewable 

resources sector and for innovative projects in renewable energy, 

including solar, wind, hydro, geothermal and biomass. These 

environmentally-friendly and sustainable projects are expected to 

avoid the emission of 931,312 tons of CO2 per year — about the yearly 

emissions from more than 165,000 passenger vehicles.

A $16 million small business loan — representing OPIC’s fi rst fi nancing 

in wind power — will support construction of a wind generating facility 

on St. Kitts, helping the island reduce both its carbon footprint and its 

fuel costs. The plant will deliver the fi rst wind-powered energy on the 

island, which is currently powered exclusively by diesel generators, and 

could reduce electricity costs by as much as 40 percent. In Georgia, 

a $58 million OPIC loan is fi nancing construction of a 46-megawatt 

hydropower plant that will increase the country’s energy independence 

without increasing its carbon footprint, while also generating electricity 

for export to neighboring Turkey.

PRIORITIES
2011 OPIC ANNUAL REPORT 13

2011 OPIC ANNUAL REPORT 15

Following an initial loan in 2008, OPIC in 2011 

approved a second loan to Buchanan Renewables 

Fuel, a partially U.S.-owned Liberian enterprise 

that is turning end-of-life rubber trees into wood 

chips for export as biomass fuel to Europe for 

the generation of electricity. Buchanan will use 

$90 million in new OPIC fi nancing to increase 

wood chip production from 100,000 metric tons 

to more than 2 million metric tons per year by 

2017. While rubber is Liberia’s leading export, years 

of civil war interrupted production, destroying 

60 to 70 percent of the nation’s rubber trees 

and leaving farmers without a source of income 

or the means to remove old trees and resume 

production. Buchanan is turning that waste into an 

exportable commodity and paying farmers to clear 

the old trees.

To catalyze and facilitate even greater private 

capital driven development of renewable 

resources, OPIC in 2011 approved nearly $500 

million in fi nancing for fi ve 

new investment funds that 

could ultimately invest more 

than $1.5 billion in renewable 

resources in emerging 

markets.

In addition to OPIC’s 

traditional suite of fi nance 

and insurance off erings, and support for private 

equity funds, some of the agency’s newer services 

have been tailored for renewable energy investors. 

These include long-term subordinated debt 

fi nance for the adoption of energy effi ciency 

programs and insurance against regulatory 

changes such as changes in the regulation of 

carbon credits.

EXPANDING ACCESS 

TO CREDIT

Economic growth is dependent on the availability 

of aff ordable credit for consumers, home buyers, 

small businesses and developers of infrastructure. 

But many countries in the developing world lack 

the fi nancial systems that borrowers in developed 

nations take for granted. That is why many of 

OPIC’s projects and investment funds are designed 

to provide the liquidity or guarantees necessary 

to stimulate lending in countries where credit is in 

short supply.

In January 2011, a fi rst-of-its-kind OPIC project 

that guaranteed a bond issuance in local capital 

markets was named 2010 Deal of the Year for Best 

Structured Financing and Best Financing Innovation 

by LatinFinance magazine and was also named 

the Latin America Domestic Currency Bond Deal 

of the Year by International Financing Review. In 

that project, OPIC provided 

a guaranty of up to $250 

million supporting pesodenominated bonds issued 

in association with the 

modernization of the State 

of Mexico’s public property 

registry. The modernized 

system will speed the recording of local home 

ownership, vastly improving legal certainty of 

property title and improving homeowners’ access 

to credit. Enabled through U.S. sponsor MBIA Inc., 

the transaction marked the fi rst time OPIC has 

guaranteed the raising of local-currency capital by 

a sub-sovereign entity.

Microfi nance loans will become more readily 

available to low-income individuals and small 

businesses around the world through OPIC’s 

continuing partnership with Citi. A new OPIC 

guaranty for Citi will support its loan to Tameer 

OPIC’s development fi nance 

model endures in a world

where the political

landscape has changed

dramatically.
16 2011 OPIC ANNUAL REPORT

18 2011 OPIC ANNUAL REPORT

FROM HOUSEHOLD NAMES TO LOCAL 

BUSINESSES: EXPANDING PARTICIPATION 

IN THE GLOBAL ECONOMY

In supporting the investment of private capital in developing nations, 

OPIC recognizes that projects of any size — from the largest 

infrastructure program to the smallest microfi nance startup — can 

have a signifi cant developmental impact. OPIC also believes that 

businesses both large and small can play an important role in bringing 

the benefi ts of development to emerging economies. Diff erent 

projects have diff erent challenges that may be best addressed by an 

international fi nancial institution or company, a fl exible small business 

or a member of a diaspora community who has strong roots in a 

particular country. That is why OPIC works with a range of clients, 

from large corporations to small- and medium-sized enterprises; from 

private investment fi rms to individual investors.

For example, a Massachusetts small business, QuantumID 

Technologies (QID), will use an OPIC loan to expand the use of its 

award-winning RFID-based cargo tracking technology to airports 

throughout India. One QID client, a major Indian passenger airline and 

cargo operator, will use the Airline Cargo Tracking solution to expand 

service from seven airport locations to 65, covering 100 cities with 425 

warehouse locations. It will also enable door-to-door services for 72 

cities. A second client is considering QID’s product for 30 warehouses 

and more than 300 pick-up and delivery locations. RFID technology 

enables reading of transponder tags attached to movable or stationary 

assets, which the project’s U.S. sponsor equates to moving “from the 

tollbooth to the E-Z Pass lane.”

At the other end of the business spectrum, OPIC’s partnership with 

the energy operating and development company ContourGlobal 

of New York is helping to increase the use of sustainable, energyeffi cient technologies in Africa. Some $37.8 million in OPIC political 

risk insurance will support the company’s construction and operation 

of three combined heat and power generation plants for the Nigeria 

Bottling Company (NBC). ContourGlobal’s unique QuadGenTM process 

will enable NBC — an affi liate of Coca-Cola Hellenic Bottling Co. — to 

reduce its energy consumption and CO2

 emissions and then recycle 

the captured and purifi ed gas into its carbonated beverages.

CLIENTS

20 2011 OPIC ANNUAL REPORT

MICROFINANCE FOR 

ENTREPRENEURS, FARMERS 

AND HOMEBUYERS

With loans ranging from $100,000 to $400 million, OPIC’s fi nancing 

programs are well-tailored to the needs of the agency’s U.S. clients. But 

many businesses in emerging markets could fi nance their ventures with 

just a few thousand dollars — or less. To provide access to capital for such 

borrowers, OPIC supports targeted investment funds and provides loans to 

organizations that are better positioned to support microfi nance programs. 

OPIC’s $45 million loan to the Habitat for Humanity subsidiary MicroBuild 

I will help thousands of low-income families around the world to build, 

improve and maintain decent homes. OPIC’s fi nancing will enable 

MicroBuild to make loans to microfi nance institutions, which in turn will 

make home improvement loans to low-income families that have little or 

no access to the formal banking sector or mortgage loans.

New OPIC fi nancing in the agency’s continuing partnership with Lafi se 

Group Panama Inc., a holding company organized by two U.S. citizens, 

will expand availability 

of long-term credit for 

small- and medium-sized 

enterprises (SMEs) in 

Costa Rica, Honduras and 

Panama. Strengthened 

by its $25 million OPIC 

loan, Lafi se Group Panama 

Inc., through its local banks in these countries, will provide small farmers, 

manufacturers and retail business owners in underserved Central American 

markets with access to the credit that can help them grow more quickly 

and contribute to their local economies. Lafi se is a regional fi nancial group 

that has operated in Central America and the Caribbean for more than 

26 years.

In a similar fashion, a $10 million OPIC guaranty for WorldBusiness 

Capital Inc. will support a loan that MuganBank Open Stock Company of 

Azerbaijan will use to increase lending for SME borrowers in construction, 

agriculture, transportation and other services.

And a $3 million OPIC investment guaranty will enable the Jordanian 

company Millennium Energy Industries to expand its design, installation 

and fi nancing services for large-scale solar heating and cooling systems 

for customers in Algeria, Egypt, Jordan, Lebanon, Morocco and Tunisia.

OPIC fi nancing will 

support lending to low 

income families who have 

little or no access to 

traditional mortgage loans.

22 2011 OPIC ANNUAL REPORT

24 2011 OPIC ANNUAL REPORT

MOBILIZING INVESTMENT THROUGHOUT 

THE DEVELOPING WORLD

OPIC is a development fi nance institution global in scale, created 

to encourage the fl ow of private capital into regions and countries 

where the private sector might lack the confi dence to invest even 

though genuine opportunities await. A country that has only begun the 

transition from a controlled economy to one based on free markets 

and competition, may lack the stability of a well-established fi nancial 

infrastructure. Or it might be recovering from years of confl ict, 

corruption or unrest. OPIC aims to be active in countries such as 

these, which are in most need of development and where the markets 

are most diffi cult. To that end, OPIC is currently focusing much of 

its work on North Africa and the Middle East, Sub-Saharan Africa and 

Southeast Asia — all places that present signifi cant challenges and 

signifi cant opportunities.

MIDDLE EAST AND NORTH AFRICA: 

EVENTS CALL FOR U.S. ENGAGEMENT

As public dissent toppled long-entrenched regimes in 2011, 

populations across the Middle East and North Africa (MENA) gained 

new hope that they may soon enjoy more political and economic 

freedom. Events of the Arab Spring also presented the United 

States with important new opportunities to help these nations seek 

peaceful transformations.

And OPIC is taking a leading role. In separate speeches, President 

Obama and Secretary of State Hillary Clinton announced that OPIC 

will be providing a total of $3 billion in new fi nancing to support 

infrastructure and the small- and medium-sized enterprises (SMEs) 

that generate 97 percent of the jobs in emerging economies. OPIC’s 

board moved quickly to begin fulfi lling Secretary Clinton’s pledge of 

$2 billion in support throughout the MENA region. Within 90 days 

of that announcement, OPIC conceived, structured and approved 

$500 million in fi nancial guaranties to alleviate the shortage of SME 

credit in Egypt and Jordan. In addition to the project’s partial risk 

guaranties from OPIC that will be managed by U.S. partner CHF 

International, the U.S. Agency for International Development provided 

critical grant funding for operating and technical assistance.

REGIONS
2011 OPIC ANNUAL REPORT 25

2011 OPIC ANNUAL REPORT 27

In addition to the $2 billion MENA commitment, 

another $1 billion in OPIC support specifi cally for 

Egypt was announced by President Obama in a 

May 19 speech. Over the next few years, OPIC will 

be working with the Egyptian government, other 

U.S. agencies and international organizations to 

attract private investment for priority projects in 

infrastructure, housing and other key sectors in 

Egypt.

These latest commitments will build on OPIC’s 

long history of supporting projects in the MENA 

region, including the 2011 NETKETABi deal (Arabic 

for “my netbook”) to help tens of thousands of 

Palestinian school children in the West Bank 

purchase netbook computers. The NETKETABi 

project sponsor is Global Catalyst Foundation, 

a California foundation that was instrumental in 

establishing Partners for Sustainable Development 

(PSD), a Palestinian nongovernmental organization. 

PSD will use a $10 million OPIC loan to buy 

the netbooks and sell 

them to parents through 

a lending program 

facilitated by the local 

microfi nance institution, 

Alrafah Microfi nance Bank. 

The NETKETABi project is 

also providing training to 

students and teachers to 

access educational content. 

NETKETABi is strengthening 

local knowledge transfer 

by engaging with six Palestinian universities 

on training methods and development of local 

educational content.

SUB-SAHARAN AFRICA: A 

LONGSTANDING PRIORITY

The recipient of nearly $6.7 billion of OPIC support 

in 441 projects since 1974, Africa has been a 

priority region for OPIC throughout most of the 

agency’s history. OPIC remains committed to 

providing the support that enables U.S. investors 

to participate in meeting Africa’s developmental, 

social and environmental needs. At the same time, 

OPIC is also working to create awareness of the 

new reality that makes Africa such an attractive 

region for impact investment: to date in the 21st 

Century, investment in Africa has off ered some of 

the highest returns of any emerging market in the 

world.

In 2011, 34 percent of OPIC’s commitments 

were to projects in Sub-Saharan Africa. OPICsupported projects in the region are designed to 

encourage use of renewable resources, build out 

infrastructure (especially 

in the agricultural sector), 

help meet the growing 

need for modern health 

care services and expand 

access to fi nance by 

small and medium-sized 

enterprises.

In the renewable energy 

sector, OPIC fi nancing 

will help to double the 

generating capacity of a geothermal power plant 

in Kenya, provide low-carbon-footprint combined 

heat and power technology to a beverage bottler 

in Nigeria and transform wood chips from warravaged Liberian rubber tree plantations into 

exportable biomass fuel.

“We’re changing how we 

defi ne development ... 

we need to harness all the tools 

at our disposal — from our 

diplomacy to our trade 

and investment policies.”

— President Barack Obama




32 2011 OPIC ANNUAL REPORT

INVESTMENTS
2011 OPIC ANNUAL REPORT 33

AFRICA AND THE MIDDLE EAST

ANGOLA

Plant-Tech Concrete Solutions LLC Tivannah Global, Limitada Sand and gravel for construction purposes $2,781,010 Insurance

CAMEROON

Access Africa Fund, LLC Advans Cameroon Loan $1,500,000 Insurance

COTE D’ IVOIRE

International Rescue Committee International Rescue Committee Individual and family social services $2,081,735 Insurance

GHANA

Belstar Development, LLC Ministry of Health of Ghana Supply of modern medical equipment at technical 

training to equip 100 hospitals

$246,067,200 Insurance

IRAQ

Northern Gulf Partners, LLC Northern Gulf Rentals Ltd Heavy equipment leasing $20,500,000 Finance

JORDAN

ENNIS RIMAWI Intl. Co. for Energy Technology 

Industries

Solar thermal technology services $3,000,000 Finance

K&M Group of Companies, LLC Fujeij Wind IPP Wind IPP $225,000 Insurance

KENYA

David Gacheru Eco-Metropolitan 

Development Co. Ltd.

Housing construction $1,330,000 Finance

Ormat International Orpower 4 Geothermal 52 MW expansion of geothermal power plant $310,000,000 Finance

Access Africa Fund, LLC Milango Financial Services Limited Loan $500,000 Insurance

LIBERIA

Broad Cove Partners Broad Cove Ecohomes Liberia, Inc Construction fi nance for 70 home project $1,900,000 Finance

James Steele and Chris Jorgensen Buchanan Renewables Fuel, Inc. Expansion of rubber wood harvesting and wood chip 

supply business

$90,000,000 Finance

MADAGASCAR

Seaboard Corporation LMM Farine, S.A. Flour mill operation $11,627,086 Insurance

MALI

American International School 

of Bamako

American International School 

of Bamako

School $3,960,000 Insurance

NIGERIA

Citibank N/A Bel Papyrus Ltd Paper production mill $15,000,000 Finance

Keffi Group, Rohatyn Group, & 

Discover Global Citizens Bank

Union Global Partners Ltd Tier II recapitalization plan for Union Bank of Nigeria $250,000,000 Finance

TANZANIA

World Business Capital, Inc. African Banking Corporation 

Tanzania Ltd

Expansion of the borrower’s SME lending portfolio. $9,750,000 Finance

UGANDA

Microvest I, LP Pearl Microfi nance Limited Microfi nance $750,000 Insurance

Access Africa Fund, LLC Pearl Microfi nance Limited Microfi nance $250,000 Insurance

Access Africa Fund, LLC Ugafode Microfi nance Limited Microfi nance $500,000 Insurance

Chemonics International Not Applicable Consulting services $281,250 Insurance

WEST BANK

Global Catalyst Foundation Partners for Sustainable 

Development - Netketabi

Netbooks for schoolchildren in the West Bank $10,000,000 Finance

Massar International Siraj Palestine Fund I Closed-end investment fund $30,000,000 Investment Funds

AFRICA AND MIDDLE EAST REGIONAL

Accelerator Technology and 

Innovation Capital Partners, L.P.

Accelerator Technology and 

Innovation Fund

Closed-end investment fund $25,000,000 Investment Funds

Care USA Access Africa Fund Microfi nance investment vehicle for loans in Africa $20,000,000 Finance

US SPONSOR/

INSURED INVESTOR PROJECT NAME PROJECT DESCRIPTION

2011 OPIC ANNUAL REPORT 35

GEORGIA

Bankworld JSC BasisBank Expansion of SME lending in Georgia 

(Senior loan)

$2,925,000 Finance

Bankworld JSC BasisBank II Funding of Tier II Capital (Subordinated loan) $1,950,000 Finance

Firebird Avrora Fund JSC POPULI Expansion of chain of retail grocery stores $21,000,000 Finance

Bank of New York Mellon 

Corporation

Firebird Avrora Advisors LLC

Firebird Management LLC

Mtkvari HPP, LLC Development & operation of hydropower 

generating facility

$58,000,000 Finance

Firebird Avrora Advisors, LLC JSC Teliani Valley Expansion of winery and vino-tourism $8,000,000 Finance

Edward Raupp & Nicholas Alasania University of Georgia Acquisition and renovation of new building in Tbilisi $8,050,000 Finance

Microvest I, LP JSC MFO Crystal Microfi nance $250,000 Insurance

Microvest Short-Duration Fund, LP JSC MFO Crystal Microfi nance $1,000,000 Insurance

KAZAKHSTAN

Microvest Short-Duration Fund, LP Limited Liability Partnership 

MicroCredit Organization Arnur

Credit company $750,000 Insurance

KOSOVO

Microvest Short-Duration Fund, LP World Relief (known as Beselidjha/

Zavet Micro)

Microfi nance $355,125 Insurance

MOLDOVA

Development Alternatives, Inc Not Applicable Assets and vehicles $8,000,000 Insurance*

RUSSIA

Firebird Avrora Advisors LLC OJSC SDM-Bank (II) Expansion of the borrower’s SME lending portfolio $4,875,000 Finance

Western Retail Development LLC PJ Western Retail 

Investments Ltd II

Expansion of 17 Papa John’s franchise stores in Moscow $2,735,900 Finance

TURKEY

Citibank N.A. BankPozitif Kredi ve Kalkınma 

Bankası A.Ş.

Expansion of SME lending portfolio $30,000,000 Finance

Citibank, N.A. Sekerbank T.A.S. Expansion of microfi nance portfolio $7,000,000 Finance

UZBEKISTAN

O&S Consulting, LLC Bukhara Malikhasi, LLC Hotel renovation $764,100 Insurance

LATIN AMERICA AND THE CARIBBEAN

ARGENTINA

Jomada Trust Argentina Olive Ranch, S.A. Land development for olive plantations & processing $10,000,000 Finance

Jamada Distributing, LLC Argentina Olive Ranch, S.A. Olive orchard for olive oil production $4,007,739 Insurance

BRAZIL

Wachovia, a Wells Fargo Company Banco Safra Expansion of SME portfolio $18,000,000 Finance

Terremark Worldwide, Inc. Terremark Do Brazil, LTDA Expansion of existing data storage facility $9,000,000 Finance

COLOMBIA

Joshi Technologies 

International Inc.

Joshi Technologies 

International Inc. III

Oil fi eld expansion $18,000,000 Finance

Sharon Gurtler Parks and 

Charles D. Parks

Parko Services S.A. Oil well expansion $6,400,000 Finance

DOMINICAN REPUBLIC

Chemonics International Not Applicable Consulting services $525,000 Insurance

US SPONSOR/

INSURED INVESTOR PROJECT NAME PROJECT DESCRIPTION

* This is one of four Development Alternative Projects (Afghanistan, Bangladesh, Azerbaijan, and Moldova) that share a cap of $8,000,000.

**

**Information has temporarily been redacted, including to protect the safety of implementing partners.
36 2011 OPIC ANNUAL REPORT

ECUADOR

Citibank, N.A. Banco Procredit S.A. Expansion of microfi nance portfolio $7,000,000 Finance

Microvest I, LP Fundacion para el Desarrollo 

Microempresarial Mision Alianza

Political risk insurance for a loan to a microfi nance 

institution

$2,000,000 Insurance

EL SALVADOR

Chemonics International Not Applicable Consulting services $1,397,500 Insurance

HAITI

Michael W. Acra Haiti 360 LLC Ready-mix concrete production, earthquake rubble 

recycling, cement additive production

$6,000,000 Finance

International Rescue Committee International Rescue Committee Offi ce equipment/support services $1,040,209 Insurance

Seaboard Corporation Les Moulins D’Haiti S.E.M (LMH) Reconstruction of fl our mill $7,367,469 Insurance

MEXICO

Alsis Mexico International 

Holdings, LLC

Alsis Mexico Opportunities Fund 

Holdings, LP

Mortgage fi nance and securitizations $22,800,000 Investment Funds

Alta Growth Capital Mexico 

Fund LP

Analistas De Recursos Globales 

Sapi DE CV

Expansion of rental and leasing activities to SME’s $7,312,500 Finance

Brysam II LLC Apoyo Economico Familiar 

SA DE C.V.SOFOM

Support expansion of borrower’s microfi nance 

loan portfolio

$9,750,000 Finance

The Alta Group, LLC Operadora De Servicios Mega, 

S.A. DE C.

Expansion of SME leasing portfolio in Mexico $9,750,000 Finance

Microvest Short-Duration Fund, LP 

(Forjadores)

Forjadores de Negocios, SA de CV 

loan portfolio

Political risk insurance for a loan to a microfi nance 

institution

$500,000 Insurance

PANAMA

Citibank N.A. Global Bank Corporation Expansion of SME and consumer lending portfolios $30,000,000 Finance

Roberto Zamora Lafi se Group

Panama Inc.

Tier II capital for the expansion of lending activities $25,000,000 Finance

Chemonics International Not Applicable Consulting services $125,000 Insurance

PARAGUAY

Citibank, N.A. Grupo Internacional De 

Finanzas SAECA

Expansion of microfi nance portfolio $2,333,100 Finance

PERU

GK Financing, LLC Gamma Knife Peru Installation/operation of stereotactic radiosurgery $2,057,460 Finance

Assured Guaranty GTS Majes S.A.C. AND GTS 

Reparticion S.A.C.

Construction and operation of a utility-scale 

solar project 

$123,000,000 Finance

ST. CHRISTOPHER-NEVIS

North Star International North Star St. Kitts, Ltd. 5.4 MW wind power project $16,090,000 Finance

ALL OPIC COUNTRIES

Wells Fargo HSBC Trade Bank Air Drilling Associates Contracting of geothermal drilling services to 

resource owners

$10,000,000 Finance

Grassroots Business Fund Grassroots Business Investors 

Fund I. L.P. 

Facility for making loans to projects $20,000,000 Finance

Minlam Asset Management, LLC Minlam Microfi nance Fund Expansion of existing microfi nance investment vehicle $28,000,000 Finance

Root Capital Root Capital Lending vehicle for loans to projects in developing 

countries

$20,000,000 Finance

US SPONSOR/

INSURED INVESTOR PROJECT NAME PROJECT DESCRIPTION
2011 OPIC ANNUAL REPORT 37

INVESTMENT FUNDS PORTFOLIO ACTIVITIES Asia Development Partners III, L.P. Vishwa Infrastructure and Services Ltd Water and waste water India

Southeast Europe Equity Fund II, L.P. Propak Ambalaj Üretim ve Pazarlama A.S. Flexible packaging Turkey

SAWHF PVE (SA) Stuttafords Housing South Africa

Protea Glen Housing South Africa

Jukskei View Housing South Africa

Summerset Housing South Africa

Greatermans Building Housing South Africa

Carnival City Housing South Africa

Paladin Realty Latin America Investors III, L.P. A-PIMA Homebuilding Platform

Viver Incorporadora e Construtora SA

Low-income housing

Middle-income housing

Brazil

Brazil

Palamar Homebuilding Platform Low-income housing Brazil

QuadCity Homebuilding Platform Middle-income housing Brazil

YP Homebuilding Platform Middle-income housing Brazil

Alsis Latin America Fund L.P. Afi ver Consumer loans Mexico

Integradora de Apoyo Municipal Financial services to state 

and municipal governments

Mexico

COUNTRY/

FUND NAME PORTFOLIO COMPANY DESCRIPTION REGION

*

*Information has temporarily been redacted, including to protect the safety of implementing partners.

2011 OPIC ANNUAL REPORT 39

FINANCIAL STATEMENTSD

Independent Auditors’ Report on Financial Statements 

To the Board of Directors 

Overseas Private Investment Corporation 

We have audited the accompanying balance sheet of the Overseas Private Investment 

Corporation (OPIC) as of September 30, 2011, and the related statements of income, capital 

and retained earnings, and cash flows for the year then ended. These financial statements are 

the responsibility of OPIC’s management. Our responsibility is to express an opinion on these 

financial statements based on our audit. The financial statements of OPIC as of September 30, 

2010, were audited by other auditors whose report dated November 15, 2010, expressed an 

unqualified opinion on those statements. 

We conducted our audit in accordance with auditing standards generally accepted in the United 

States of America; the standards applicable to financial audits contained in Government 

Auditing Standards, issued by the Comptroller General of the United States; and the applicable 

provisions of Office of Management and Budget (OMB) Bulletin No. 07-04, Audit Requirements 

for Federal Financial Statements, as amended. Those standards require that we plan and

perform the audit to obtain reasonable assurance about whether the financial statements are 

free of material misstatement. An audit also includes examining, on a test basis, evidence 

supporting the amounts and disclosures in the financial statements. An audit also includes 

assessing the accounting principles used and significant estimates made by management, as 

well as evaluating the overall financial statement presentation. We believe that our audit 

provides a reasonable basis for our opinion. 

In our opinion, the financial statements referred to above present fairly, in all material respects, 

the financial position of the Overseas Private Investment Corporation as of September 30, 2011, 

and the results of operations, and its cash flows for the year then ended in conformity with 

accounting principles generally accepted in the United States of America. 

In accordance with Government Auditing Standards, we have also issued our report dated 

November 14, 2011, on our consideration of OPIC’s internal control over financial reporting and 

our tests of its compliance with certain provisions of laws and regulations and other matters. 

The purpose of that report is to describe the scope of our testing of internal control over financial 

reporting and compliance and the results of that testing, and not to provide an opinion on the 

internal control over financial reporting or on compliance. That report is an integral part of an 

audit performed in accordance with Government Auditing Standards and should be read in 

D

conjunction with this report in assessing the results of our audit. 

Calverton, Maryland 

November 14, 2011 

K
40 2011 OPIC ANNUAL REPORT

D

Independent Auditors’ Report on Internal Control Over Financial Reporting and 

Compliance with Laws and Regulations and Other Matters

The Board of Directors 

Overseas Private Investment Corporation 

We have audited the financial statements of the Overseas Private Investment Corporation 

(OPIC) as of and for the year ended September 30, 2011, and have issued our report thereon 

dated November 14, 2011. We conducted our audit in accordance with auditing standards 

generally accepted in the United States of America; the standards applicable to financial audits 

contained in Government Auditing Standards, issued by the Comptroller General of the United 

States; and the applicable provisions of Office of Management and Budget (OMB) Bulletin No. 

07-04, Audit Requirements for Federal Financial Statements, as amended. 

INTERNAL CONTROL OVER FINANCIAL REPORTING AND COMPLIANCE 

In planning and performing our audit, we considered OPIC’s internal control over financial 

reporting as a basis for designing our auditing procedures, and to comply with OMB audit 

guidance for the purpose of expressing our opinion on the financial statements but not for the 

purpose of expressing an opinion on the effectiveness of OPIC’s internal control over financial 

reporting. Accordingly, we do not express an opinion on the effectiveness of OPIC’s internal 

control over financial reporting. 

A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to 

prevent, or detect and correct misstatements on a timely basis. 

A material weakness is a deficiency, or a combination of deficiencies, in internal control, such 

that there is a reasonable possibility that a material misstatement of the entity’s financial 

statements will not be prevented, or detected and corrected on a timely basis. 

A significant deficiency is a control deficiency or a combination of deficiencies in internal control 

that is less severe than a material weakness, yet important enough to merit attention by those 

charged with governance. 

Our consideration of internal control over financial reporting was for the limited purpose 

described in the first paragraph of this section and would not necessarily identify all deficiencies 

in internal control over financial reporting that might be significant deficiencies or material 

weaknesses. We did not identify any deficiencies in internal control over financial reporting and 

compliance that we consider to be a material weakness or significant deficiency, as defined 

above. 

K
2011 OPIC ANNUAL REPORT 41

COMPLIANCE WITH LAWS AND REGULATIONS AND OTHER MATTERS 

As part of obtaining reasonable assurance about whether OPIC’s financial statements are free 

of material misstatements, we performed tests of its compliance with certain provisions of laws 

and regulations, noncompliance with which could have a direct and material effect on the 

determination of financial statement amounts and certain other laws and regulations specified in 

OMB guidance, including the requirements referred to in the Federal Financial Management 

Improvement Act of 1996 (FFMIA). However, providing an opinion on compliance with those 

provisions was not an objective of our audit, and accordingly, we do not express such an 

opinion. The results of our tests disclosed no instances of noncompliance or other matters that 

are required to be reported under generally accepted government audit standards and OMB 

guidance. Additionally, the results of our tests disclosed no instances in which OPIC’s financial 

management systems did not substantially comply with FFMIA. 

We noted certain matters that we reported to management of OPIC in a separate letter dated 

November 14, 2011. 

This report is intended solely for the information and use of OPIC’s management, OPIC’s Board 

of Directors, OMB, the Government Accountability Office, and the United States Congress and 

is not intended to be and should not be used by anyone other than these specified parties. 

D

Calverton, Maryland 

November 14, 2011 
42 2011 OPIC ANNUAL REPORT

Assets 2011 2010

Fund Balance with U.S. Treasury (notes 2 and 4) $ 707,257 $ 566,172

U.S. Treasury securities, at amortized cost plus related receivables (notes 2 and 7) 5,188,527 5,049,091

Direct loans outstanding, net (notes 2 and 10) 1,326,292 1,076,217

Accounts receivable resulting from investment guaranties, net (notes 2 and 11) 59,602 63,231

Assets acquired in insurance claims settlements, net (notes 2 and 11) 1,507 16,782

Guaranty receivable (notes 2 and 19) 456,130 273,686

Accrued interest and fees and other, net (notes 2 and 10) 29,481 26,699

Furniture, equipment and leasehold improvements at cost less accumulated depreciation and

 amortization of $15,742 in FY2011 and $14,881 in FY2010 (note 2) 6,649 6,011

 Total assets $ 7,775,445 $ 7,077,889

Liabilities, Capital, and Retained Earnings

Liabilities:

 Reserve for political risk insurance (note 9) $ 275,000 $ 275,000

 Reserve for investment guaranties (notes 10) 573,331 650,229

 Accounts payable and accrued expenses 4,984 7,025

 Guaranty liability (notes 2 and 19) 456,130 273,686

 Customer deposits and deferred income 47,465 45,775

 Borrowings from U.S. Treasury, and related interest (note 6) 1,827,691 1,402,915

 Unearned premiums 8,144 9,662

 Deferred rent & rent incentives from lessor of $5,779 and $5,416 net of accumulated 

 amortization of $2,421 and $2,065 in FY2011 and FY2010 (note 14) 3,358 3,351

 Total liabilities 3,196,103 2,667,643

Contingent liabilities (notes 2 and 17)

Capital and retained earnings:

 Contributed capital 50,000 50,000

 Credit funding (note 5) 105,788 106,338

 Interagency transfers (Note 2) 16,354 8,902

 Retained earnings and reserves:

 Insurance (notes 9 and 12) 790,887 705,410

 Guaranty (notes 10 and 12) 3,616,313 3,539,596

4,579,342 4,410,246

 Total liabilities, capital, and retained earnings $ 7,775,445 $ 7,077,889

BALANCE SHEETS

Overseas Private Investment Corporation—Years ended September 30, 2011 and 2010 ($ in thousands)

See accompanying notes to fi nancial statements.
2011 OPIC ANNUAL REPORT 43

Revenues 2011 2010

Political risk insurance premiums and fees (note 9) $ 14,281 $ 15,419

Investment fi nancing interest and fees 218,164 170,151

Interest on fi nance program deposits 31,059 33,410

Interest on U.S. Treasury securities 170,364 178,516

 Total revenues 433,868 397,496

Expenses

Provisions for reserves:

 Political risk insurance (notes 2 and 9) (9,750) (26,394)

 Investment fi nancing (notes 2, 10 and 11) 34,720 35,271

Salaries and benefi ts (note 15) 31,608 30,574

Rent, communications and utilities (note 14) 6,953 7,581

Contractual services 13,596 14,812

Travel 3,949 3,298

Interest on borrowings from U.S. Treasury (note 6) 80,824 70,343

Depreciation and amortization (note 2) 885 315

Other general and administrative expenses 1,627 1,821

Total expenses 164,412 137,621

Net income $ 269,456 $ 259,875

STATEMENTS OF INCOME

Overseas Private Investment Corporation—Years ended September 30, 2011 and 2010 ($ in thousands)

See accompanying notes to fi nancial statements.
44 2011 OPIC ANNUAL REPORT

See accompanying notes to fi nancial statements.

STATEMENTS OF CAPITAL AND RETAINED EARNINGS

Overseas Private Investment Corporation—Years ended September 30, 2011 and 2010 ($ in thousands)

Equity reserves

Contributed

capital

Credit

funding

Interagency

transfers

Insurance 

(notes 9 & 12)

Guaranty 

(notes 10 & 12)

Retained 

earnings

Total

Balance, Sept. 30, 2009 $ 50,000 $ 111,056 $ 10,810 $ 839,271 $ 3,322,941 $ — $ 4,334,078

Net income — — — (121,793) 381,668 — 259,875

Return credit funding

 to U.S. Treasury — — — — (199,594) — (199,594)

Credit funding (net) received from:

 Accumulated earnings — 45,361 — (13,975) — (31,386) —

 Credit appropriations — 15,888 — — — — 15,888

Credit funding used — (65,967) — — 34,581 31,386 —

Interagency transfers — — (1,908) 1,907 — — (1)

Balance, Sept. 30, 2010 $ 50,000 $ 106,338 $ 8,902 $ 705,410 $ 3,539,596 $ — $ 4,410,246

Net income — — — 101,008 168,448 — 269,456

Return credit funding

 to U.S. Treasury — — — — (292,376) — (292,376)

Credit funding (net) received from:

 Accumulated earnings — 49,465 — (18,079) — (31,386) —

 Credit appropriations — 182,016 — — — — 182,016

Credit funding used — (232,031) — — 200,645 31,386 —

Interagency transfers — — 7,452 2,548 — — 10,000

Balance, Sept. 30, 2011 $ 50,000 $ 105.788 $ 16,354 $ 790,887 $ 3,616,313 $ — $ 4,579,342
2011 OPIC ANNUAL REPORT 45

See accompanying notes to fi nancial statements.

2011 2010

Cash fl ows from operating activities:

 Net income 269,456 $ 259,875

 Adjustments to reconcile net income to net cash provided by operating activities:

 Provisions for:

 Political risk insurance (9,750) (26,395)

 Investment fi nancing 34,720 35,271

 Amortization of premiums on U.S. securities 15,023 15,029

 Accretion of discounts on U.S. securities (5,302) (6,359)

 Amortization of deferred rent and rental incentives 2 85

 Increase in rent incentives 5 —

 Depreciation and amortization 885 315

 (Increase) decrease in operating assets:

 Accrued interest and fees and other (33,596) 1,744

 Guaranty receivable (182,444) (39,727)

 Assets acquired in insurance claims settlements (1,034) —

 Recoveries on assets acquired in insurance claims settlements 26,059 25,559

 Assets acquired in fi nance claims settlements (59,787) (69,800)

 Recoveries on assets acquired in fi nance claims settlements 15,891 14,094

 Increase (decrease) in operating liabilities:

 Accounts payable and accrued expenses (2,041) 1,039

 Customer deposits and deferred income 1,690 5,258

 Guaranty liability 182,444 39,727

 Unearned premiums (1,518) (928)

 Cash provided by operating activities 250,703 254,787

Cash fl ows from investing activities:

 Sale and maturity of U.S. Treasury securities 512,025 1,289,188

 Purchase of U.S. Treasury securities (661,646) (1,451,385)

 Repayment of direct loans 135,670 167,844

 Disbursement of direct loans (418,560) (454,163)

 Acquisition of furniture and equipment (1,523) (2,257)

 Cash used in investing activities (434,034) (450,773)

Cash fl ows from fi nancing activities:

 Return credit funding to U.S. Treasury (292,376) (199,594)

 Interagency transfers 10,000 (1)

 Credit appropriations 182,016 15,888

 Credit reform borrowings from U.S. Treasury 424,776 396,395

 Cash provided by (used in) fi nancing activities 324,416 212,688

Net increase in cash 141,085 16,702

Fund Balance with U.S. Treasury at beginning of year 566,172 549,470

Fund Balance with U.S. Treasury at end of year $ 707,257 $ 566,172

STATEMENTS OF CASH FLOWS

Overseas Private Investment Corporation—Years ended September 30, 2011 and 2010 ($ in thousands)
46 2011 OPIC ANNUAL REPORT

NOTES TO FINANCIAL STATEMENTS 

Overseas Private Investment Corporation—Years ended September 30, 2011 and 2010

(1) Statement of Corporate Purpose 

The Overseas Private Investment Corporation (OPIC) is a selfsustaining U.S. Government corporation created under the 

Foreign Assistance Act of 1961 (FAA), as amended. OPIC facilitates 

U.S. private investment in developing countries and emerging 

market economies, primarily by offering political risk insurance, 

investment guaranties, and direct loans. As a government corporation, OPIC is not subject to income tax. 

(2) Summary of Signifi cant Accounting Policies 

Basis of Presentation: These fi nancial statements have been 

prepared to report the fi nancial position, results of operations, 

and cash fl ows of OPIC. OPIC’s accounting policies conform to 

accounting principles generally accepted in the United States of 

America. OPIC’s fi nancial statements are presented on the accrual basis of accounting. Under the accrual basis, revenues are 

recognized when earned, and expenses are recognized when a liability is incurred, without regard to receipt or payment of cash. 

Fund Balance with U.S. Treasury: Substantially all of OPIC’s 

receipts and disbursements are processed by the U.S. Treasury 

which, in effect, maintains OPIC’s bank accounts. For purposes of 

the Statement of Cash Flows, Fund Balance with U.S. Treasury is 

considered cash. 

Investment in U.S. Treasury Securities: By statute, OPIC is 

authorized to invest funds derived from fees and other revenues 

related to its insurance and preinvestment programs in U.S. 

Treasury securities. Investments are carried at face value, net of 

unamortized discount or premium, and are held to maturity. OPIC 

has the ability and intent to hold its investments until maturity 

or until the carrying cost can be otherwise recovered. 

Assets Acquired in Investment Guaranty and Insurance 

Claims Settlements: Assets acquired in claims settlements are 

valued at the lower of management’s estimate of the net realizable value of recovery or the cost of acquisition. 

OPIC acquires foreign currency in settlement of inconvertibility 

claims when an insured foreign enterprise is unable to convert 

foreign currency into U.S. dollars, as well as in some direct loan 

and investment guaranty collection efforts. The initial U.S. dollar 

equivalent is recorded and revalued annually until the foreign 

currency is utilized by OPIC or other agencies of the United 

States Government, or until it is exchanged for U.S. dollars by the 

foreign government. 

Allowances: The allowances are based on management’s 

periodic evaluations of the underlying assets. In its evaluation, 

management considers numerous factors, including, but not 

limited to, general economic conditions, asset composition, prior 

loss experience, the estimated fair value of any collateral, and 

the present value of expected future cash fl ows. OPIC writes off 

a loan when it believes that viable collection efforts have been 

exhausted and no further recovery is expected. 

Depreciation and Amortization: OPIC capitalizes property 

and equipment at historical cost for acquisitions exceeding 

$5,000. Depreciation and amortization of fi xed assets, leasehold 

improvements, and lease incentives are computed using the 

straight-line method over the estimated useful life of the asset 

or lease term, whichever is shorter, with periods ranging from 5 

to 15 years. 

Reserves for Political Risk Insurance and Investment 

Guaranties: The reserves for political risk insurance and 

investment guaranties provide for losses inherent in those 

operations using the straight-line method. These reserves are 

general reserves, available to absorb losses related to the total 

insurance and guaranties outstanding, which are off-balancesheet commitments. The reserves are increased by provisions 

charged to expense and decreased for claims settlements. The 

provisions for political risk insurance and investment guaranties 

are based on management’s evaluation of the adequacy of the 

related reserves. This evaluation encompasses consideration of 

past loss experience, changes in the composition and volume of 

the insurance and guaranties outstanding, worldwide economic 

and political conditions, and project-specifi c risk factors. Also, 

in the political risk insurance reserve evaluation, OPIC takes into 

consideration losses incurred but not yet reported. 

FASB Accounting Standards Codifi cation Topic 460 for the 

Guarantee Topic (FASB ASC 460): FASB ASC 460 requires 

that upon issuance of a guaranty, the guarantor must disclose 

and recognize a liability for the fair value of the obligation it 

assumes under that guaranty. The initial recognition and measurement requirement of FASB ASC 460 applies only to guaranties issued or modifi ed after December 31, 2002. OPIC’s initial 

guarantee obligation reported, represents the fair value of the 

investment guaranties. This obligation is reduced over the term 

of the investment guarantee agreements, as OPIC is released 

from its obligation. 

Revenue Recognition: Facility fees are received in advance 

and recognized as deferred income, then amortized over the 

applicable loan period using the straight-line method. Interest on loans and guaranty fees on investment guaranties are 

accrued based on the principal amount outstanding. Prior to 

fi scal year 2011, revenue from both loan interest payments 

and guaranty fees that was more than 90 days past due was 

recognized only when cash was received. During FY 2011, OPIC 

implemented a loans accounting system that provided transactional support for recording the revenues associated with 

these non-performing projects. Revenue from political risk 

insurance premiums is recognized over the contract coverage 
2011 OPIC ANNUAL REPORT 47

period. Accretion of premium and discount on investment securities is amortized into income under a method approximating 

the effective yield method. 

Interagency transfers: OPIC periodically receives funding from 

other U.S. Government agencies to be used to support various 

programs and initiatives. 

Use of Estimates: The preparation of fi nancial statements 

requires management to make estimates and assumptions 

that affect the reported amounts of assets and liabilities, the 

disclosure of contingent assets and liabilities at the date of the 

fi nancial statements, and the reported amounts of revenue and 

expenses during the reporting period. Actual results could differ 

from these estimates. 

Commitments and Contingencies: Liabilities from loss contingencies, other than those related to political risk insurance and 

investment guaranties, arising from claims, assessments, litigation, fi nes and penalties, and other sources, are recorded when it 

is probable that a liability has been incurred and the amount of 

the assessment and/or remediation can be reasonably estimated. Loss contingencies that do not meet these criteria, but 

are reasonably possible and estimable are not accrued, but are 

disclosed in Note 17. 

(3) Intragovernmental Financial Activities 

OPIC, as a U.S. Government corporation, is subject to fi nancial 

decisions and management controls of the Offi ce of Management 

and Budget. As a result of this relationship, OPIC’s operations 

may not be conducted, nor its fi nancial position reported, as 

they would be if OPIC were not a government corporation. Furthermore, in accordance with international agreements relating 

to its programs, foreign currency acquired by OPIC can be used 

for U.S. Government expenses. This constitutes an additional 

means, which would otherwise be unavailable, by which OPIC can 

recover U.S. dollars with respect to its insurance and investment 

fi nancing programs. 

(4) Fund Balance with U.S. Treasury 

OPIC is restricted in its uses of certain cash balances, as 

described below. The fund balance with U.S. Treasury as of 

September 30, 2011 and 2010 consists of the following (dollars 

in thousands): 

 2011 2010 

Restricted: 

 Pre-Credit reform $ 10 10 

 Credit reform 692,712 557,751

 Interagency fund transfers 10,000 — 

Unrestricted 4,535 8,411 

 Total $ 707,257 566,172

The Federal Credit Reform Act of 1990 established separate 

accounts for cash fl ows associated with investment fi nancing activity approved prior to implementation of the Act and 

investment fi nancing activity subject to the Act. With the advent 

of Credit Reform, OPIC is not permitted to invest its pre-Credit 

Reform cash balances. These balances grow over time, and when 

they are determined to be no longer needed for the liquidation 

of the remaining pre-Credit Reform direct loans and investment 

guaranties, they are transferred to OPIC’s unrestricted noncredit 

insurance account. OPIC made transfers totaling $30,000 and 

$1,556,369 to the noncredit insurance account in 2011 and 2010, 

respectively. Credit Reform balances are also maintained in the 

form of uninvested funds. The U.S. Treasury pays OPIC interest 

on those cash balances except for undisbursed credit funding. 

(5) Credit Funding 

OPIC’s fi nance activities are subject to the Federal Credit Reform 

Act of 1990, which was implemented as of October 1, 1991. Credit 

Reform requires agencies to estimate the long-term cost to the 

government of each fi scal year’s new credit transactions and 

to obtain funding through the appropriations process equal to 

the net present value of such costs at the beginning of the year. 

OPIC’s credit funding is available for three years. In addition, 

the Act requires the administrative costs related to its credit 

program to be displayed. 

In fi scal year 2011, OPIC’s appropriations legislation authorized 

the corporation to use $18.1 million of its accumulated earnings to cover the future costs of credit transactions committed 

in fi scal years 2011 through 2013. In fi scal year 2010, OPIC was 

authorized to use $29 million to cover commitments in fi scal years 2010 through 2012. In addition to the credit funding 

allocated directly to OPIC through the appropriations process, 

OPIC received a total of $67 million in net transfers from other 

agencies to be used exclusively to fi nance projects in the New 

Independent States (NIS). 

The following table shows the status of funding for credit activities (dollars in thousands): 

 2011 2010 

Balance carried forward $ 106,338 111,056

Upward reestimates 182,016 15,888 

Transferred from earnings (net of returns) 49,465 45,361 

Expired credit funding — — 

Credit funding used (232,031) (65,967) 

 Credit funding remaining $ 105,788 106,338 

Changes in fi nancial and economic factors over time can affect 

the subsidy estimates made at the time of loan and guaranty 

commitments. Therefore, in accordance with OMB guidelines, 

OPIC reestimates subsidy costs for each group of loans and 

guaranties obligated in a given fi scal year to account for those 

changing factors. Reestimates that result in increases to subsidy 

costs are funded with additional appropriated funds that are 

made automatically available, while decreases to subsidy costs 

result in excess funds that are transferred to the U.S. Treasury. 
48 2011 OPIC ANNUAL REPORT

OPIC incurred increased subsidy costs of $182 million and $15.9 

million and decreases in subsidy costs of $216.6 million and 

$123.4 million in fi scal years 2011 and 2010, respectively. During 

fi scal year 2010, OPIC received permission from OMB to return 

expired credit funding to the source of the original funds, OPIC’s 

unrestricted noncredit insurance account, rather than to the 

U.S. Treasury. No credit funding expired during fi scal year 2011; 

however, expired credit funding of $15 million was transferred 

back to the noncredit account earnings during fi scal year 2010. 

(6) Borrowings From the U.S. Treasury 

In accordance with the Federal Credit Reform Act of 1990, the 

portion of investment fi nancing activities not funded through 

the appropriations process must be funded by borrowings from 

the U.S. Treasury. Borrowings for Credit Reform fi nancings totaled $578 million in 2011 and $593.5 million in 2010, all of which 

have been disbursed. OPIC paid a total of $80.8 million and $70.3 

million in interest to the U.S. Treasury during fi scal years 2011 

and 2010, resp ectively. Repayments of borrowings from the U.S. 

Treasury totaled $153.2 million in 2011 and $197.1 million in 2010. 

Future payments for borrowing outstanding at September 30, 

2011 are as follows (dollars in thousands): 

Amount Due 

Payment due in: 

 Fiscal year 2012 $ 13,166 

 Fiscal year 2013 51,161 

 Fiscal year 2014 117,434 

 Fiscal year 2015 421,760 

 Fiscal year 2016 105,730 

 Thereafter 1,118,440 

 Total $ 1,827,691 

(7) Investment in U.S. Treasury Securities 

The composition of investments and related receivables at September 30, 2011 and 2010 is as follows (dollars in thousands): 

 2011 2010 

Investments, amortized cost $ 5,151,261 5,011,361

Interest receivable 37,266 37,730 

 Total $ 5,188,527 5,049,091 

The amortized cost and estimated fair value of investments in 

U.S. Treasury securities are as follows (dollars in thousands): 

 Amortized Unrealized Unrealized Estimated 

 Cost Gains Losses Fair Value 

At September 30, 2011 $ 5,151,261 488,780 — 5,640,041 

At September 30, 2010 $ 5,011,361 474,943 — 5,486,304 

At September 30, 2011, the securities held had an interest range 

of 1.125% to 9.875% and a maturity period from two weeks to 

almost 17 years. 

OPIC holds its securities to maturity. The amortized cost and estimated fair value of U.S. Treasury securities at September 30, 2011, 

by contractual maturity, are shown below (dollars in thousands): 

 Amortized Estimated 

 Cost Fair Value 

Due in one year or less $ 732,434 741,441 

Due after one year through fi ve years 3,053,638 3,254,290 

Due after fi ve years through 10 years 1,196,514 1,403,738 

Due after 10 years 168,675 240,572 

 Total $ 5,151,261 5,640,041 

(8) Statutory Limitations on the Issuance of 

Insurance and Finance 

OPIC issues insurance and fi nancing under a single limit for both 

programs, currently $29 billion, fi xed by statute in the FAA. At 

September 30, 2011, OPIC’s insurance and fi nance programs have 

collectively utilized $14.5 billion. 

(9) Political Risk Insurance 

Insurance revenues include the following components for the 

years ended September 30 (dollars in thousands): 

 2011 2010 

Political risk insurance premiums $ 14,281 15,419 

Miscellaneous insurance income — —

 Total insurance revenue $ 14,281 15,419 

OPIC’s capital, allowance, retained earnings, and reserves 

available for insurance at September 30, 2011 and 2010 totaled 

$1.1 billion and $1 billion, respectively. Charges against retained 

earnings could arise from (A) outstanding political risk insurance 

contracts, (B) pending claims under insurance contracts, and 

guaranties issued in settlement of claims arising under insurance contracts. 

(a) Political Risk Insurance 

OPIC insures investments for up to 20 years against three 

different risks: inconvertibility of currency, expropriation, 

and political violence. Insurance coverage against inconvertibility protects the investor from increased restrictions on the 

investor’s ability to convert local currency into U.S. dollars. 

Inconvertibility insurance does not protect against devaluation of a country’s currency. 

Expropriation coverage provides compensation for losses 

due to confi scation, nationalization, or other governmental 

actions that deprive investors of their fundamental rights in 

the investment. 

Insurance against political violence insures investors 

against losses caused by politically motivated acts of violence (war, revolution, insurrection, or civil strife, including 

terrorism and sabotage). 
2011 OPIC ANNUAL REPORT 49

Under most OPIC insurance contracts, investors may obtain 

all three coverages, but claim payments may not exceed the 

single highest coverage amount. Claim payments are limited 

by the value of the investment and the amount of current 

coverage in force at the time of the loss and may be reduced 

by the insured’s recoveries from other sources. In addition, in 

certain contracts, OPIC’s requirement to pay up to the single 

highest coverage amount is further reduced by stop-loss and 

risk-sharing agreements. Finally, losses on insurance claims 

may be reduced by recoveries by OPIC as subrogee of the 

insured’s claim against the host government. Payments made 

under insurance contracts that result in recoverable assets 

are reported as assets acquired in insurance settlements. 

OPIC’s Maximum Contingent Liability at September 30, 2011 and 

2010 was $2.6 billion and $2.3 billion, respectively. This amount 

is OPIC’s estimate of maximum exposure to insurance claims, 

which includes standby coverage for which OPIC is committed 

but not currently at risk. A more realistic measure of OPIC’s 

actual exposure to insurance claims is the sum of each single 

highest “current” coverage for all contracts in force, or Current 

Exposure to Claims (CEC). OPIC’s CEC at September 30, 2011 and 

2010 was $1.7 billion and $1.6 billion, respectively. 

(b) Pending Claims 

At both September 30, 2011 and 2010 OPIC had no material 

pending insurance claims. In addition to requiring formal 

applications for claimed compensation, OPIC’s contracts 

generally require investors to notify OPIC promptly of host 

government action that the investor has reason to believe is 

or may become a claim. Compliance with this notice provision 

sometimes results in the fi ling of notices of events that do not 

mature into claims. 

OPIC does not record a specifi c liability related to such notices 

in its fi nancial statements, due to the highly speculative nature of such notices, both as to the likelihood that the events 

referred to will ripen into any claims, and the amounts of compensation, if any, that may become due. Any claims that might 

arise from these situations are factored into the reserves for 

political risk insurance. 

Changes in the reserve for political risk insurance during fi scal years 2011 and 2010 were as follows (dollars in thousands): 

 2011 2010 

 Beginning balance $ 275,000 300,000 

 Amounts charged off — 0 

 Increase/(Decrease) in provisions 29 (26,394) 

 Transfers (to)/from other reserves (29) 1,394 

 Ending balance $ 275,000 275,000 

(10) Investment Financing 

OPIC is authorized to provide investment fi nancing to projects 

through direct loans and investment guaranties. Project fi nancing provides medium-to long-term funding through direct loans 

and investment guaranties to ventures involving signifi cant equity and/or management participation by U.S. businesses. Project 

fi nancing looks for repayment from the cash fl ows generated 

by projects, and as such, sponsors need not pledge their own 

general credit beyond the required project completion period. 

Investment funds use direct loans and investment guaranties 

to support the creation and capitalization of investment funds 

that make direct equity and equity-related investments in new, 

expanding, or privatizing companies in emerging market economies. The fund managers, selected by OPIC, are experienced, 

private investment professionals. OPIC’s participation in a fund 

takes the form of long-term, secured loans and loan guaranties that supplement the fund’s privately raised equity. OPIC’s 

guaranty may be applied only to the debt portion of the fund’s 

capital and, for certain funds, to accrued interest on that debt. 

OPIC does not guaranty any of the fund’s equity, and all equity 

investments in OPIC-backed funds are fully at risk. 

OPIC’s authorization to make direct loans and investment 

guaranties can be found in sections 234(c) and 234(b) of the FAA, 

respectively. Direct loans and investment guaranties are committed in accordance with the Federal Credit Reform Act of 1990, 

pursuant to which loan disbursements and any claim payments 

for these commitments have been funded through appropriations actions, borrowings from the U.S. Treasury, and the accumulation of earnings or collection of fees. In fi scal years 2011 

and 2010, $18.1 million and $29 million, respectively, was made 

available for credit funding costs. OPIC is in compliance with all 

relevant limitations and credit funding appropriations guidance. 

OPIC’s capital, allowances, retained earnings, and reserves available for claims on its investment fi nancing at September 30, 2011 

and 2010 totaled $4.5 billion and $4.3 billion, respectively. 

Direct Loans: Direct loans are made for projects in developing and other eligible countries involving U.S. small business 

or cooperatives, on terms and conditions established by OPIC. 

Direct loan exposure at September 30, 2011 totaled $3.6 billion, 

of which approximately $1.5 billion was outstanding. Direct loan 

exposure at September 30, 2010 totaled $3.2 billion, of which approximately $1.2 billion was outstanding. Prior to FY2011, interest 

income was not accrued on direct loans that had payments that 

were more than 90 days past due. If interest income had been 

accrued on those loans, it would have approximated $6.5 million 

in FY2010. Interest collected on those delinquent loans and 

recorded as income when received in fi scal year 2010 amounted 

to $18.1 million. In FY2011, interest income was accrued on those 

direct loans and has been reserved in full. Interest accrued on 

those loans during fi scal year 2011 was $25.2 million. Loans with 

payments more than 90 days past due totaled $192.5 million at 

September 30, 2011 and $127 million at September 30, 2010. 
50 2011 OPIC ANNUAL REPORT

Direct loans outstanding were as follows (dollars in thousands): 

 2011 2010

Direct loans outstanding $ 1,488,487 1,215,903

Allowance for uncollectible loans (162,195) (139,686)

Direct loans outstanding, net $ 1,326,292 1,076,217

Changes in the allowance for uncollectible loans during fi scal 

years 2011 and 2010 were as follows (dollars in thousands): 

 2011 2010 

Beginning balance $ 139,686 120,226 

Amounts charged off (8,987) (900) 

Recoveries 12 15 

Increase in provisions 31,484 20,345 

Ending balance $ 162,195 139,686 

Investment Guaranties: OPIC’s investment guaranty covers the 

risk of default for any reason. In the event of a claim on OPIC’s 

guaranty, OPIC makes payments of principal and interest to the 

lender. These payments are recorded as accounts receivable 

resulting from investment guaranties. The loans that are guaranteed can bear either fi xed or fl oating rates of interest and are 

payable in U.S. dollars. OPIC’s losses on payment of a guaranty 

are reduced by the amount of any recovery from the borrower, 

the host government, or through disposition of assets acquired 

upon payment of a claim. Guaranties extend from 5 to 21 years 

for project fi nance and from 10 to 18 years for investment funds. 

Credit risk represents the maximum potential loss due to possible nonperformance by borrowers under terms of the contracts. 

OPIC’s exposure to credit risk under investment guaranties, 

including claim-related assets, was $8.3 billion at September 

30, 2011, of which $5 billion was outstanding. Of the $8.3 billion 

of exposure, $5.7 billion was related to project fi nance and $2.6 

billion was related to investment fund guarantees. Of the $5 

billion outstanding, $4.1 billion related to project fi nance and 

$.9 billion related to investment fund guaranties. Included in 

the $2.6 billion of investment fund exposure is $241.8 million of 

estimated interest that could accrue to the guaranty lender. This 

interest generally accrues over a 10-year period, payable upon 

maturity. Upon complete nonperformance by the borrower, OPIC 

would be liable for principal outstanding and interest accrued on 

disbursed investment funds. At September 30, 2011, $112.9 million 

of the $241.8 million had actually accrued to the guaranteed 

lender on disbursed investment funds; the remainder represents 

an estimate of interest that could accrue to the guaranteed 

lender over the remaining investment fund term. 

At September 30, 2010, OPIC’s exposure to credit risk under 

investment guaranties, including claim-related assets, was $8.5 

billion, of which $5.1 billion was outstanding. Of the $8.5 billion 

of exposure, $6.1 billion was related to project fi nance and $2.4 

billion was related to investment fund guarantees. Of the $5.1 

billion outstanding, $4.2 billion related to project fi nance and 

$.9 million related to investment fund guaranties. Included in 

the $2.4 billion of investment fund exposure is $309 million of 

estimated interest that could accrue to the guaranty lender. This 

interest generally accrues over a 10-year period, payable upon 

maturity. Upon complete nonperformance by the borrower, OPIC 

would be liable for principal outstanding and interest accrued 

on disbursed investment funds. At September 30, 2010, $91 million of the $309 million had actually accrued to the guaranteed 

lender on disbursed investment funds; the remainder represents 

an estimate of interest that could accrue to the guaranteed 

lender over the remaining investment fund term. 

Changes in the reserve for investment guaranties during fi scal 

years 2011 and 2010 were as follows: 

 2011 2010

Beginning balance $ 650,229 676,422

Decrease in provisions (76,898) (26,193)

Ending balance $ 573,331 650,229

Accrued Interest, Fees and Other, net of Allowance: Prior to fi scal 

year 2011, Interest, Fee and other income was not accrued on 

direct loans and guarantees that had payments that were more 

than 90 days past due. Revenue collected was recorded as income when received. During fi scal year 2011, OPIC implemented a 

loans accounting system that provided transactional support for 

recording the revenues associated with these non-performing 

projects. These income transactions are reserved in full. 

 2011 2010 

Accrued Interest, Fees and Other, Gross $ 56,921 26,699 

Less Allowance (27,440) — 

Net $ 29,481 26,699 

(11) Accounts Receivable from Investment 

Guaranties and Assets Acquired in Insurance 

Claims Settlements (Claim-Related Assets) 

Claim-related assets may result from payments on claims under 

either the investment fi nancing program or the insurance program. Under the investment fi nancing program, when OPIC pays 

a guaranteed party, a receiva ble is created. Under the insurance program, similar receivables refl ect the value of assets, 

generally shares of stock, local currency, or host country notes, 

that may be acquired as a result of a claim settlement. These 

receivables are generally collected over a period of 1 to 15 years. 

Accounts receivable resulting from investment guaranties were 

as follows (dollars in thousands): 

2011 2010 

Accounts receivable resulting from 

investment guaranties $ 162,590 127,495 

Allowance for doubtful recoveries (102,988) (64,264) 

Accounts receivable, net $ 59,602 63,231 
2011 OPIC ANNUAL REPORT 51

Changes in the allowance for doubtful recoveries for assets 

resulting from investment guaranties during fi scal years 2011 

and 2010 were as follows (dollars in thousands): 

 2011 2010 

Beginning balance $ 64,264 21,283 

Amounts charged off (8,801) (16) 

Increase in provisions 47,525 42,997 Recoveries — — 

Ending balance $ 102,988 64,264 

Assets acquired in insurance claims settlements were as follows 

(dollars in thousands): 

2011 2010 

Assets acquired in insurance

 claims settlements $ 3,014 18,260 

Allowance for doubtful recoveries (1,507) (1,478) 

Accounts receivable, net $ 1,507 16,782 

Changes in the allowance for doubtful recoveries for assets 

acquired in insurance claims settlements during fi scal years 2011 

and 2010 were as follows (dollars in thousands): 

2011 2010 

Beginning balance $ 1,478 2,873 

Amounts charged off — — 

Transfers (to)/from other reserves 29 (1,395) 

Ending balance $ 1,507 1,478 

(12) Reserves and Full Faith and Credit 

Section 235(c) of the FAA established a fund which shall be 

available for discharge of liabilities under insurance or reinsurance or under similar predecessor guaranty authority. This fund 

consists of the Insurance Reserve and the Guaranty Reserve for 

the respective discharge of potential future liabilities arising 

from insurance or from guaranties issued under Section 234(b) 

of the FAA. These amounts may be increased by transfers from 

retained earnings or by appropriations. In fi scal years 2011 and 

2010, OPIC’s retained earnings were allocated to these reserves 

on the basis of maximum exposure outstanding for insurance 

and guaranties respectively, thereby refl ecting OPIC’s increased 

ability to absorb potential losses without having to seek appropriated funds. 

All valid claims arising from insurance and guaranties issued 

by OPIC constitute obligations on which the full faith and credit 

of the United States of America is pledged for full payment. At 

September 30, 2011 and 2010, the Insurance Reserve totaled 

$791 million and $705 million, and the Guaranty Reserve totaled 

$3.6 billion and $3.5 billion, respectively. Should funds in OPIC’s 

reserves not be suffi cient to discharge obligations arising under 

insurance, and if OPIC exceeds its $100 million borrowing authority authorized by statute for its insurance program, funds would 

have to be appropriated to fulfi ll the pledge of full faith and 

credit to which such obligations are entitled. Standing authority 

for such appropriations is contained in Section 235(f) of the FAA. 

The Federal Credit Reform Act of 1990 authorizes permanent, 

indefi nite appropriations and borrowings from the U.S. Treasury, 

as appropriate, to carry out all obligations resulting from the 

investment fi nancing program. 

(13) Disclosures About Fair Value of Financial 

Instruments 

The estimated values of each class of fi nancial instrument for 

which it is practicable to estimate a fair value at September 30, 

2011 are as follows (dollars in thousands): 

 Carrying Fair

 Amount Value

Financial assets:

 Cash $ 707,257 707,257

 U.S. Treasury securities 5,151,261 5,640,041

 Interest receivable on securities 37,266 37,266

 Direct loans 1,326,292 1,326,292

 Accounts receivable from 

 investment guaranties 59,602 59,602

 Assets acquired in insurance 

 claims settlements 1,507 1,507

Financial liabilities:

 Borrowings from the U.S. Treasury 1,827,691 1,776,314

The methods and assumptions used to estimate the fair value of 

each class of fi nancial instrument are described below: 

Cash: The carrying amount approximates fair value because of 

the liquid nature of the cash, including restricted cash. 

U.S. Treasury Securities: The fair values of the U.S. Treasury 

securities are estimated based on quoted prices for Treasury 

securities of the same maturity available to the public. OPIC is 

not authorized, however, to sell its securities to the public, but is 

instead restricted to direct transactions with the U.S. Treasury. 

Interest receivable on the securities is due within 6 months and 

is considered to be stated at its fair value. 

Direct Loans, Accounts Receivable Resulting from Investment Guaranties, and Assets Acquired in Insurance Claims 

Settlements: These assets are stated on the balance sheet at 

the present value of the amount expected to be realized. This 

value is based on management’s quarterly review of the portfolio and considers specifi c factors related to each individual 

receivable and its collateral. The stated value on the balance 

sheet is also management’s best estimate of fair value for 

these instruments. 

Borrowings from the U.S. Treasury: The fair value of borrowings from the U.S. Treasury is estimated based on the face value 

of borrowings discounted over their term at year-end rates. 

These borrowings were required by the Federal Credit Reform 
52 2011 OPIC ANNUAL REPORT

Act, and repayment terms are fi xed by the U.S. Treasury in accordance with that Act. 

Investment Guaranties Committed and Outstanding: OPIC’s 

investment guaranties are intended to provide a means of 

mobilizing private capital in markets where private lenders 

would be unwilling to lend without the full faith and credit of the 

U.S. Government. Given the absence of a market for comparable 

instruments, OPIC determined that the fair value is the present 

value of future fees expected to be collected. 

(14) Operating Lease 

OPIC negotiated a new building lease during fi scal year 2004. 

Under the lease terms, OPIC received interest-bearing tenant improvement allowances for space refurbishment. Total incentives 

offered by the lessor to cover these costs were $3.4 million. The 

value of these incentives is deferred in the balance sheet and is 

amortized to reduce rent expense on a straight-line basis over 

the 15-year life of the lease. 

Rental expense for fi scal years 2011 and 2010 was approximately 

$4.2 million and $4.1 million, respectively. Minimum future rental 

payments under the 15-year lease at 1100 New York Avenue, N.W. 

are approximately $4.7 million annually, with additional adjustments tied to the consumer price index. 

(15) Pensions 

OPIC’s permanent employees are covered by the Civil Service Retirement System (CSRS) or the Federal Employee Retirement System (FERS). For CSRS, OPIC withheld 7% of employees’ gross 2011 

earnings and contributed 7% of employees’ 2011 gross earnings. 

The sums were transferred to the Civil Service Retirement Fund 

from which this employee group will receive retirement benefi ts. 

For FERS, OPIC withheld 0.80% of employees’ gross earnings. 

OPIC transferred this sum to the FERS fund from which the employee group will receive retirement benefi ts. An additional 6.2% 

of the FERS employees’ gross earnings is withheld, and that, plus 

matching contributions by OPIC, are sent to the Social Security 

System from which the FERS employee group will receive social 

security benefi ts. OPIC occasionally hires employees on temporary appointments, and those employees are covered by the 

social security system under which 6.2% of earnings is withheld 

and matched by OPIC. For calendar year 2011, a special reduction 

of 2% is being applied to the Social Security withholding rate, 

pursuant to the “Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010”. 

FERS and CSRS employees may elect to participate in the Thrift 

Savings Plan (TSP). In January 2006 the TSP contributions limits 

were eliminated. In 2011 both CSRS and FERS employees could 

elect to contribute up to $16,500, the IRS elective deferral limit 

for the tax year. FERS employees receive an automatic 1% contribution from OPIC. Amounts withheld for FERS employees are 

matched by OPIC, up to an additional 4%, for a total of 5%. 

The amount of employer contributions to these plans for the 

year ended September 30, 2011 was $3.8 million. 

Although OPIC funds a portion of employee pension benefi ts 

under the CSRS, the FERS, and the TSP, and makes necessary 

payroll withholdings, it has no liability for future payments to 

employees under these programs. Furthermore, separate information related to OPIC’s participation in these plans is not available for disclosure in the fi nancial statements. Paying retirement 

benefi ts and reporting plan assets and actuarial information is 

the responsibility of the U.S. Offi ce of Personnel Management 

and the Federal Retirement Thrift Investment Board, which 

administer these plans. Data regarding the CSRS and FERS 

actuarial present value of accumulated benefi ts, assets available 

for benefi ts, and unfunded pension liability are not allocated to 

individual departments and agencies. 

(16) Concentration of Risk 

OPIC is subject to certain risks associated with fi nancial 

instruments not refl ected in its balance sheet. These fi nancial 

instruments include political risk insurance, loan guaranties, and 

committed-but-undisbursed direct loans. 

With respect to political risk insurance, OPIC insures against 

currency inconvertibility, expropriation of assets, and political violence. Additionally, OPIC provides investment fi nancing 

through direct loans and investment guaranties. 

OPIC’s credit policy is to take a senior security position in the assets of the projects or transactions it guaranties. The nature and 

recoverable value of the collateral pledged to OPIC varies from 

transaction to transaction and may include tangible assets, cash 

collateral or equivalents, and/or a pledge of shares in the project 

company as well as personal and corporate guaranties. OPIC 

takes all necessary steps to protect its position in such collateral 

and retains the ability to enforce its rights as a secured lender if 

such action becomes necessary. 

The following is a summary of OPIC’s off-balance-sheet risk at 

September 30, 2011 and 2010 (dollars in thousands): 

2011 

Unused

 Total Outstanding Commitments

Guaranties $ 8,096,076 4,867,358 3,228,718

Undisbursed 

 direct loans 2,119,809 — 2,119,809

Insurance 2,595,376 1,662,057 933,319
2011 OPIC ANNUAL REPORT 53

2010

Unused

 Total Outstanding Commitments

Guaranties $ 8,372,377 4,968,684 3,403,693

Undisbursed 

 direct loans 1,976,376 — 1,976,376

Insurance 2,330,144 1,649,619 680,525

OPIC’s off-balance-sheet fi nance and insurance exposure 

involves coverage outside of the United States. The following is a 

breakdown of such total commitments at September 30, 2011 by 

major geographical area (dollars in thousands): 

 Undisbursed 

 Loan Portion on 

 Guaranties Direct Loans Insurance 

Africa $ 1,576,507 272,695 825,315 

Asia 999,045 307,456 475,364 

Europe 836,192 60,045 7,998 

Latin America 2,433,681 277,204 389,163 

Middle East 1,218,431 644,523 595,614 

NIS (New Independent 

 States) 695,716 271,836 359,219 

Worldwide 336,504 281,250 —

Insurance stop 

 loss adjustment — — (57,297) 

 $ 8,096,076 2,115,009 2,595,376 

OPIC has several client-specifi c contracts with stop-loss limits 

that are less than the aggregate coverage amounts. The insurance stop-loss adjustment represents the difference between 

the aggregate coverage amount and OPIC’s actual exposure 

under these contracts. 

At September 30, 2011, OPIC’s largest fi nance and insurance 

exposure was in the following countries and sectors (dollars in 

thousands): 

Country 

Jordan $ 674,228 

Russia 656,276 

Nigeria 574,307 

Turkey 543,133 

West Bank & Gaza 507,729 

Sector

Financial services $ 7,310,362

Energy — Power 2,839,728

Services 1,316,070

Energy — Oil and Gas 1,005,577

Transportation 621,494

(17) Other Contingencies 

OPIC is currently involved in certain legal claims and has 

received notifi cations of potential claims in the normal course 

of business. There are substantial factual and legal issues that 

might bar any recovery in these matters. It is not possible to 

evaluate the likelihood of any unfavorable outcome, nor is it 

possible to estimate the amount of compensation, if any, that 

may be determined to be owed in the context of a settlement. 

Management believes that the resolution of these claims will not 

have a material adverse impact on OPIC. 

(18) Subsequent Events 

Management evaluated subsequent events through November 

14, 2011, the date the fi nancial statements were available to be 

issued. Events or transactions occurring after September 30, 

2011, but prior to November 14, 2011, that provided additional 

evidence about conditions that existed at September 30, 2011, 

have been recognized in the fi nancial statements for the period 

ended September 30, 2011. Events that provided evidence about 

conditions that did not exist at September 30, 2011, but arose 

before the fi nancial statements were available to be issued, have 

not been recognized in the fi nancial statements for the period 

ended September 30, 2011. 

(19) Accounting and Disclosure Requirements 

for Guaranties 

In FY 2011 and FY 2010 pursuant to the requirement of FASB ASC 

460, OPIC recognized a guaranty liability and a guaranty fee 

receivable of $456.1 million and $273.7 million, respectively. OPIC 

collected $81.8 million and $73.4 million of guaranty fees in FY 

2011 and FY 2010, respectively, on the investment guaranties 

issued since December 31, 2002. 

(20) Statutory Covenants 

OPIC’s enabling statute stipulates both operating and fi nancial 

requirements with which OPIC must comply. In management’s 

opinion, OPIC is in compliance with all such requirements. 
54 2011 OPIC ANNUAL REPORT

BOARD OF DIRECTORS

EXECUTIVE STAFF

Elizabeth L. Littlefi eld

Chairman of the Board 

President and Chief Executive Offi cer

Overseas Private Investment Corp.

Demetrios J. Marantis

Deputy U.S. Trade Representative,

Offi ce of the U.S. Trade Representative

Rajiv Shah

Administrator 

U.S. Agency for International 

Development

Francisco J. Sanchez

Under Secretary of Commerce for 

International Trade

U.S. Department of Commerce

Seth D. Harris

Deputy Secretary

U.S. Department of Labor

Robert D. Hormats

Under Secretary for Economic, Energy 

& Agricultural Aff airs

U.S. Department of State

Lael Brainard

Under Secretary for International 

Aff airs

U.S. Department of the Treasury

Samuel E. Ebbesen

Chief Executive Offi cer

Omni Systems Inc.

C. William Swank

Retired Executive Vice President

Ohio Farm Bureau Federation

Michael J. Warren

Principal

Albright Stonebridge Group LLC

Kevin G. Nealer

Principal & Partner

The Scowcroft Group

Patrick J. Durkin

Managing Director

Barclays Capital

Dianne Ingles Moss

President and Owner

Cartera Investment Corp.

Elizabeth L. Littlefi eld

President and Chief Executive Offi cer

Mimi Alemayehou

Executive Vice President

Matthew Schneider

Chief of Staff

Jacqueline Strasser

Deputy Chief of Staff and Senior Advisor 

to the President

John Moran

Managing Director, Investment Development 

and Coordination

Deborah Burand

Vice President and General Counsel

Allan Villabroza

Acting Vice President and Chief Financial Offi cer

John E. Morton

Vice President, Offi ce of Investment Policy 

Judith Pryor

Vice President, Offi ce of External Aff airs

Jay L. Koh

Head of Investment Funds and Chief 

Investment Strategist

Rod Morris

Vice President of Insurance

Robert B. Drumheller

Vice President, Structured Finance

James C. Polan

Vice President, Small and Medium 

Enterprise Finance

Operating out of Washington with a staff of just 205, 

OPIC has projects in 107 countries around the world.

These lists refelect positions held at the end of the fi scal year, on September 30, 2011
NOTES

OVERSEAS PRIVATE INVESTMENT CORPORATION

THE U.S. GOVERNMENT’S DEVELOPMENT FINANCE INSTITUTION

1100 NEW YORK AVENUE, NW

WASHINGTON , DC 20527

202-336-8400

WWW.OPIC.GOV