S&P warns of US withdrawal risk for World Bank

S&P Global has joined the list of leading credit rating agencies cautioning that an ‘unprecedented’ withdrawal by the United States from the World Bank and other major multilateral lenders could jeopardise their coveted triple-A credit ratings.

Last week, President Donald Trump signed an Executive Order mandating a six-month review of U.S. support for all international intergovernmental organisations to determine whether the country should withdraw from them or push for their reform.

S&P stated that the current triple-A ratings of the World Bank and other leading development banks are based on the assumption that the U.S. will maintain its support. Consequently, should Washington decide to ‘limit’ its backing, any resulting rating adjustment would likely be negative.

S&P’s lead analyst for multilateral development banks, Alexander Ekbom, noted that the ultimate impact would depend on how the financial position of each institution is affected and whether other major shareholders step in to fill the gap left by the U.S.

“Should the U.S. leave, which would be unprecedented, it is difficult to predict how any reallocation would be managed,” he said.