The Asian Development Bank (ADB) announced on Tuesday the launch of the Innovative Finance Facility for Climate in Asia and the Pacific (IF-CAP), a new program aimed at mobilizing as much as $15 billion in financing to fund climate-focused projects in Asia and Pacific countries.

The ADB is a regional multilateral development bank that provides loans, technical assistance, grants, and equity investments aimed at promoting social and economic development in Asia and the Pacific, and to eradicate extreme poverty.

The new IF-CAP program is designed to provide a new way to mobilize financing for investment in climate action in developing countries. Under the new initiative, donor countries, and potentially philanthropies, will provide grants for project preparation, along with guarantees for parts of ADB’s loan portfolios. The guarantees effectively takes the sovereign loans off of ADB’s books, freeing up capital to invest in climate projects.

According to ADB, the leveraged guarantee mechanism amplifies the bank’s ability by up to five times through reduced risk exposure. With an initial ambition to reach $3 billion in guarantees, the ADB expects to create up to $15 billion in new loans for climate projects aimed at reducing greenhouse gas emissions and increasing climate resilience.

Initial partners in the program include Denmark, Japan, the Republic of Korea, Sweden, the U.S. and the UK.

Introducing the new program at ADB’s 56th Annual Meeting, ADB President Masatsugu Asakawa said:

“Climate change is the critical issue of our lifetime and here in Asia and the Pacific we are on the frontlines of that battle. The climate events we have experienced over the past 12 months will only increase in intensity and frequency, so we must take bold action now. IF-CAP is an exciting, innovative program that will have a real impact. And it is another example of how ADB serves as the climate bank for Asia and the Pacific.”