In response to the deepening global financial crisis and to boost its capacity of reducing poverty, the Asian Development Bank (ADB) said on Thursday that its Board of Governors had approved the largest capital increase in the 43-year history of the lender.

The plan to triple ADB's capital base -- from US$55 billion to a staggering US$165 billion -- won the votes of overwhelming majority of its 67 members. It is also the first capital increase since 1994.

"This substantial increase is a resounding vote of confidence from our shareholders for what we can achieve as a premier development partner in the region," said ADB President Haruhiko Kuroda.

The 200 percent increase will help ADB boost its support to countries affected by the global downturn, enabling it to provide an additional US$10 billion from its Ordinary Capital Resources over the next few years for crisis-related assistance.

"We must do all we can to prevent the reversal of hard won gains for our region in social and economic development, and in poverty reduction," Kuroda said.

The decision comes two days before ADB begins its 42nd Annual Meeting in Bali, Indonesia. Around 4,000 government leaders, businesspeople, analysts and representatives from academia, civil society organizations, and media from around the world will gather on Saturday for a four-day annual meeting of lender.

The ADB President said earlier that because only four percent of the increase needed to be committed by cash and in the span of five years, the plan would not incur significant cost on the donor country's budget.

The global financial crisis continued to take its toll on developing Asia, where ADB estimates more than 60 million people will be trapped in absolute poverty this year, and nearly 100 million more in 2010.

In a recent study, ADB projected bleak outlook for developing Asia in the coming two years, with economic growth dropping to 3.4 percent this year, down form 6.3 percent in 2008. Economic powerhouses in the past such as South Korea, Singapore, Thailand and Malaysia, among others, would inevitably slide into recession, according to the report.

The capital increase will also give ADB the financial capability to pursue longer term development priorities in the region. Even before the crisis, ADB's developing member countries faced an estimated resource gap of US$53 billion a year for meeting the Millennium Development Goals.

About a quarter of the total population of ADB's developing member countries have no access to electricity, many have piped water access ratio of less than 20 percent and access to improved sanitation is as low as eight percent in some countries. In addition, more than 30 percent of the rural populations in the developing countries lack access to all-weather roads.

ADB is known to be dedicated to reducing poverty in the Asia and Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it has 67 member countries -- 48 from the region. In 2008, it approved US$10.5 billion of loans, 811.4 million of grant projects, and technical assistance amounting to US$274.5 million.