Washington, US: The World Bank is investigating the handling of a $1 billion loan from China to help fund poor countries, sources familiar with the matter told AFP Wednesday.

The global development lender was quick to stress that the probe did not implicate Beijing, which increasingly is an important force in the bank's activities.

But the probe will examine how key bank units, including the International Development Association and International Finance Corporation, created an unusual structure to accommodate the Chinese loan.

World Bank President Jim Yong Kim confirmed the probe in an internal message to staff Tuesday that was obtained by AFP.

He noted that some staff ‘have raised concerns over the handling of transactions related to a concessional loan’.

Kim stressed that the review is looking at internal processes and policy compliance, with ‘no suggestion’ of staff misconduct.

The probe, to be conducted by the Locke Lord Edwards law firm, will come on top of months of turmoil within the bank over the reforms Kim has introduced since becoming president in July 2012.

The bank's treasurer, Madelyn Antoncic, first raised questions in December over the handling of China's decision in 2013 to loan $1 billion to the IDA, the bank's funding arm for the poorest countries.

The bank then created a structure for the IDA to service the loan: it combined the Chinese funds and bought a $1.179 billion bond issued by the IFC, which is the bank's arm to finance private sector development activities.

Last year revelations that Badre had both a huge salary and bonus sparked widespread criticism by bank staff, and eventually he did not accept part of the bonus.