OFFICIAL THE WORLD BANK DOCUMENTS IBRD* IDA I WORLDBANKGROUP PATCHAMUTHU ILLANGOVAN Country Director, Pakistan South Asia Region Date: June 14, 2018 Mr. Syed Ghazanfar Abbas Jilani Secretary Economic Affairs Division Ministry of Finance, Revenue and Economic Affairs Islamic Republic of Pakistan Islamabad, Pakistan Re: IDA Financing No. 6207-PK (Housing Finance Project) Additional Instructions: Disbursement and Financial Information Letter (DFIL). Excellency: I refer to the Financing Agreement between Islamic Republic of Pakistan (the "Recipient") and the International Development Association (the "Association") for the above-referenced project. The General Conditions, as defined in the Financing Agreement, provide that the Recipient may request withdrawals of Financing funds in accordance with the instructions as the Association may specify by notice to the Recipient. The General Conditions also provide that the Disbursement and Financial Information Letter ("DFIL") may set out Project specific financial reporting requirements. This letter constitutes such DFIL, and as revised from time to time, provides such additional requirements. The Disbursement Guidelines for Investment Project Financing dated February 2017, (the "Disbursement Guidelines") are available in the Association's public website at https://www.worldbank.org and its secure website "Client Connection" at https://clientconnection.worldbank.org. The Disbursement Guidelines are an integral part of this Disbursement and Financial Reporting Letter, and the manner in which the provisions in the guidelines apply to the Financing is specified below. I. Disbursement Arrangements, Withdrawal of Financing Funds and Reporting of Uses of Financing Funds. (i) Disbursement Arrangements: * General Provisions (Schedule 1). The table in Schedule I sets out the disbursement methods which may be used by the Recipient, conditions, information on registration of authorized signatures, processing of withdrawal applications (including minimum value of applications), instructions on supporting documentation, and frequency of reporting. * Special Provision (Advances). Currently the method "Advance" is not available for the country. If during implementation it becomes available, this letter will be updated to incorporate special provisions for advances through Designated Accounts. (ii) Electronic Delivery. Section 10.01 (c) of the General Conditions: The Association may permit the Recipient to electronically deliver applications (with supporting documents) through the Association's web-based portal (https://clientconnection.worldbank.or ) THE WORLD BANK IBRD* IDA I WORLD BANKOROUP "Client Connection". This option may be effected if: (a) the Recipient has designated in writing, its officials who are authorized to sign and deliver Applications and to receive Secure Identification Credentials ("SIDC") from the Association for the purpose of delivering such Applications by electronic means; and (b) all such officials designated by the Recipient have registered as users of "Client Connection". The designated officials may deliver Applications electronically by completing the Form 2380, which is accessible through "Client Connection". The Recipient may continue to exercise the option of preparing and delivering Applications in paper form. The Association reserves the right and may, in its sole discretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient. By designating officials to use SIDC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, available in the Association's public website at https://worldbank.org and "Client Connection"; and (b) to cause such official to abide by those terms and conditions. II. Financial Reports and Audits. (i) Financial Reports. The Recipient shall prepare and furnish to the Association not later than forty five (45) days after the end of each calendar semester, interim unaudited financial reports (IFR) for the Project covering the semester. (ii) Audits. Each audit of the Financial Statements shall cover the period of one fiscal year of the Recipient, commencing with the fiscal year in which the first withdrawal was made. The audited Financial Statements for each such period shall be furnished to the Association not later than six (6) months after the end of such period. III. Other Important Information (i) Client Connection. For additional information on disbursement arrangements, please refer to the Loan Handbook available on the Association's public website and "Client Connection". The Association recommends that you register as a user of "Client Connection". From this website you will be able to prepare and deliver Applications, monitor the near real-time status of the Financing, and retrieve related policy, financial, and procurement information. For more information about the website and registration arrangements, please contact the Association by email at clientconnection(@worldbank.or. (ii) Other. If you have any queries in relation to the above, please contact Victor Ordonez, Senior Finance Officer at vcondeaworldbank.or , with copy to Daisy Zita, Finance Analyst at dzita(&worldbank.org using the above reference. Yours sincerely, Patchamuthu Ill ngova Country Director, Istan South Asia egion Attachments 1. Form of Authorized Signatory Letter 2. Interim unaudited Financial Report (IFR) Schedule 1 to DFIL Disbursement Arrangements Country Islamic Republic of Pakistan Closing Date Section III.B.2. of Schedule 2 to Credit -Recipient/Beneficiary Islamic Republic of Pakistan the Financing Agreement. Credit -PK Name of the Project Housing Finance Project Disbursement Four months after the closing Number Deadline Date date. Subsection 3.7 ** Disbursement Methods Methods Supporting Documentation Section 2 (**) Subsections 4.3 and 4.4 (**) Direct Payment Yes Copy of records Reimbursement Yes Interim unaudited Financial Report (IFR) in the format provided in Attachment 2 of the DFIL Designated Account No Currently not available, therefore PMRC will establish a Project Account (PA-A) for Part 1 of the Project Subordinated Loan, and Part 2(b) of the Project Risk Sharing Facility. After advances become available, this DFIL will be amended to allow the processing through Interim unaudited Financial Reports (IFR) in the format provided in Attachment 2 as follows: * The implementing agencies will maintain foreign currency designated accounts (DAs) at the National Bank of Pakistan, following the Foreign Currency Assignment account procedures issued by the MOF, * Project Account A (PA-A) may be converted into DA-A, * PMRC will establish a Designated Account (DA-B) for Part 2(a) of the Project Line of Credit, *The Planning Commission will establish a Designated Account (DA-C) for Part 3 of the ProjetCapacity Building. Special Commitments Yes Couy of Letter of Credit Th methd "Advance" currently is not available. The minimum value of a lications for Reimbursement, Direct Pa ment, and S ecial Commitment is USD 500,000 e uivalent. The World Bank/Association Attention: Loan Operations Unit (WFACS) Pakistan through Mr. Anwar 20-A, Shahrah-e-Jamhuriate Ali Bhatti at SACPK. Ramna, G-5/1, Islamabad Islamic Republic of Pakistan ** Sections and subsections relate to the "Disbursement Guidelines for Investment Project Financing", dated February 2017. Attachment 1 - Form of Authorized Signatory Letter [Letterhead] Ministry of Finance [Street address] [City] [Country] [DATE] The World Bank 1818 H Street, N.W. Washington, D.C. 20433 United States of America Attention: Mr. Patchamuthu Illangovan, Country Director Re: Financing No. - (Housing Finance Project) I refer to the Financing Agreement ("Agreement") between the International Development Association (the "Association") and [name of Recipient] (the "Recipient"), dated , providing the above Financing. For the purposes of Section 2.02 of the General Conditions as defined in the Agreement, any '[one] of the persons whose authenticated specimen signatures appear below is authorized on behalf of the Recipient to sign applications for withdrawal [and applications for a special commitment] under this Financing. For the purpose of delivering Applications to the Association, 2[each] of the persons whose authenticated specimen signatures appears below is authorized on behalf of the Recipient, acting 3[individually] 4[ointly], to deliver Applications, and evidence in support thereof on the terms and conditions specified by the Association. 5[This confirms that the Recipient is authorizing such persons to accept Secure Identification Credentials (SIDC) and to deliver the Applications and supporting documents to the Association by electronic means. In full recognition that the Association shall rely upon such I Instruction to the Recipient: Stipulate if more than one person needs to sign Applications, and how many or which positions, and if any thresholds apply. Please delete this footnote in final letter that is sent to the Association. 2 Instruction to the Recipient: Stipulate if more than one person needs to jointly sign Applications, if so, please indicate the actual number. Please delete this footnote in final letter that is sent to the Association. Instruction to the Recipient: Use this bracket if any one of the authorized persons may sign; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. 4 Instruction to the Recipient: Use this bracket only if several individuals must jointly sign each Application; if this is not applicable, please delete. Please delete this footnote in final letter that is sent to the Association. Instruction to the Recipient: Add this paragraph if the Recipient wishes to authorize the listed persons to accept Secure Identification Credentials and to deliver Applications by electronic means; if this is not applicable, please delete the paragraph. Please delete this footnote in final letter that is sent to the Association. representations and warranties, including without limitation, the representations and warranties contained in the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation ("Terms and Conditions of Use of SIDC"), the Recipient represents and warrants to the Association that it will cause such persons to abide by those terms and conditions.] This Authorization replaces and supersedes any Authorization currently in the Association records with respect to this Agreement. [Name], [position] Specimen Signature: [Name], [position] Specimen Signature: [Name], [position] Specimen Signature: Yours truly, / signed / [Position] Attachment 2 - Interim unaudited Financial Statements (IFR) Section A - IFR for Pakistan Mortgage Refinancing Company/ PMRC IDA Credit No. Pakistan Housing Finance Project Interim Financial Report for the Semester ended mm/dd/yyyy STATEMENT OF SOURCES AND USES OF FUNDS For the Semester Cumulative - For the Semester Cumulative - Particulars ended mm/dd/yyyy Inception to Date ended mm/dd/yyyy Inception to Date Pak Rs. Us$ OPENING BALANCE (As per Break Up given Below) SOURCES OF FUNDS Designated Account Receipts - IDA Reimbursements - IDA Direct Payments - IDA Total Receipts USES OF FUNDS: Supporting PMRC to Strengthen its Capital Base (USS60 million) Invested in: Total Component I Supporting the Expansion ofMortgage Loans (US$80 million) Line of Credit Risk Sharing Facility Total Component 2 Total IBRD Usage of Funds by SBP Total Expenditure CLOSING BALANCE (As per Break up given below) Breakup of'Opening and Closing Cash Balance Opening Balance Closing Balance Opening Balance Closing Balance Pak Rupees USS Designated Account Balance Advances with PFIs Total IDA Credit No. Pakistan Housing Finance Project Interim Financial Report for the Semester ended mm/dd/yyyy VARIANCE ANALYSIS OF USE OF FUNDS Semester (mm/ddlyyyy) Cumulative - Inception to Date (Pak Rs) Component Details Planned Rs Actual Rs A ariance Planned Rs Actual Rs A ariance Amount Rs %age Amount Rs %age Component 1 TIER 2 Capital Sub Total - Component 1 Component 2 LoC RSF Sub Total - Component 2 Grand Totall Provide Resons for all Variances beyond 15% IDA Credit No. Pakistan Housing Finance Project Interim Financial Report for the Semester ended mm/dd/yyyy CASH FORECAST FOR SEMESTER ENDING mm/dd/yyyy Cash Requirements Cash Requirements for Next Six Particulars Quarter ended Quarter ended Months mm/ddlyyyy mm/ddlyyyy Pak Rs. Pak Rs. Pak Rs. USD Component I Sub Total - Component 1 Component 2 Risk Sharing facility Line of Credit Sub Total - Component 2 - - - TOTAL - _-__ Section B - IFR for Pakistan Planning Commission IDA Credit No. P162095 - Pakistan Housing Finance Project - Planning Commission Component Interim Financial Report for the Semester ended mm/dd/yyyy STATEMENT OF SOURCES AND USES OF FUNDS For the Semester Cumulative - For the Semester Cumulative - Particulars ended mm/dd/yyyy Inception to Date ended mm/dd/yyyy Inception to Date Pak Rs. US$ OPENING BALANCE (As per Break Up given Below) SOURCES OF FUNDS Designated Account Receipts - IDA Reimbursements - IDA Direct Payments - IDA Total Receipts USES OF FUNDS: Disbursement Category 4 IDA Usage of Funds Component 3: Capacity Building for Housing Policy and Analytics (US$5 Goods (Hardware and Software) Non-Consulting Services Consultants' Services (Individuals and Firms) Trainings and Workshops Incremental operating cost Total Component 2 Total Disbursement Category 3 CLOSING BALANCE (As per Break up given below) Breakup of Opening and Closing Cash Balance Opening Balance Closing Balance Opening Balance Closing Balance Pak Rupees USs Designated Account Balance - IDA Cash in Hand (if any) - IDA Advances with Implementing Partners (if any) - IDA Total IDA Credit No. P162095 - Pakistan Housing Finance Project - Planning Commission Component Interim Financial Report for the Semester ended mm/dd/yyyy VARIANCE ANALYSIS OF USE OF FUNDS Semester (mm/ddlyyyy) Cumulative - Inception to Date (Pak Rs) Component Details Planned Rs Actual Rs A ariance %ag Planned Rs Actual Rs A ariance Amount Rs O/oage A m ount Rs %ag Component 3 Goods (Hardware and Softwarw) Non-Consulting Services Consultants' Services (Individuals and Firms) Trainings and Workshops Sub Total - Component 31 Grand Totall Provide Resons for all Variances beyond 15% IDA Credit No. P162095 - Pakistan Housing Finance Project - Planning Commission Component Interim Financial Report for the Semester ended mm/dd/yyyy CASH FORECAST FOR SEMESTER ENDING mm/dd/ Cash Requirements Cash Requirements for Next Six Particulars Quarter ended Quarter ended Months mm/dd/yyyy mm/ddlyyyy Pak Rs. Pak Rs. Pak Rs. USD Component 3 Goods (Hardware and Software) Non-Consulting Services Consultants' Services (Individuals and Firms) Trainings and Workshops Incremental Operating cost Sub Total - Component 2 - - - - TOTAL -_-_-_- IDA Credit No. P162095 - Pakistan Housing Finance Project - Planning Commission Component Interim Financial Report for the Semester ended mm/dd/yyyy DESIGNATED ACCOUNT ACTIVITY STATEMENT - IDA I 11 Ill Note US$ US$ I. Advances to the end of current semester 2. Expenditure to the end of last semester 3. Outstanding Advances to be accounted for (Line I minus Line 2) 4. DA balance at beginning of semester 5. Subtract: Cumulative Adjustments (if any) 6. Advances from IDA during the semester 7. Sub total of Advances and Adjustments (5+6) 8. Outstanding Advances to be accounted for (Line 4 plus Line 7) 9. DA balance at end of semester 10. Subtract: Cumulative Adjustments (if any) 11. Expenditure for current reporting Semester a) Disbursement Category 3 12. Sub total of Adjustments and Expenditure (10+11) 13. Advances accounted for (Add Line 9 and Line 12) 14. Difference if any (Line 8 minus Line 13) 15. Total forecasted amount to be paid by IDA 16. Less: Closing DA balance 17. Forecasted Direct Payments 18. Sub total of closing DA balance and forecasted payments (Line 16 plus Line 17) 19. Cash requirement from IDA for the next reporting period (Line 15 minus Line 18) Note 1: Cumulative Adjustments (if any) - Line 5 20. Petty Cash with the Planning Commission at mm-dd-yyyy 21. Advances with partnering institution as at mm-dd-yyyy 22. Total pet cash balance and Advance at the start of the semester Note 2: Cumulative Adjustments (if any) - Line 10 23. Petty Cash with the Planning Commission at mm-dd-yyyy 24. Advances with the implementing partner as at mm-dd-yyyy 25. Total pet cash balance and Advance at the end of the semester Note: Bank reconciliation statement and copy of the bank statement for the period should be attached � � � ��т :г`� � ° $g:- � ь$ � о � д Е � Z 4 С г� С Е � �„L �t � °. ь `� 8 с. f С ё � г а о'V т` � $ т Ё t о ' � U 5 е о �CL �С о�� дь а ��� ~� � tц � ` E Z � Z 4 G � � � _ ' Ех� t�.�д �v� s ь�"ё �д�� �¢�� осz „ � � у � � ё � Е 3 -� � L � � - t � i 2 3 t $ J _ 8 ? еу Е г°g д � € Е � У о у IDA Credit No. P162095 - Pakistan Housing Finance Project - Planning Commission Component Interim Financial Report for the semester ended mm/dd/yyyy Designated Account Expenditures for Contracts NOT Subie toPriorReview Disbursement Component Description Total Expenditure % age Financed Eligible for IDA STEP Check IDA Share paid from Designated Category by IDA Financing Account du rin Z the semester Rupees Rupees Rupees US Dollar PKR US$ Total Prior Review expenditure Total Post Review expenditure Designated Account Expenditures Direct Payment Total