Managua, Nicaragua, April 3, 2014
— IFC, a member of the World Bank Group, announced an investment of $15 million for Banco de Finanzas (BDF), Nicaragua’s fourth largest bank and market leader in residential mortgages, to strengthen the bank’s capital base and support growth in its portfolio for lending to small and medium enterprises.
The IFC Capitalization Fund (Subordinated Debt), which is managed by the IFC Asset Management Company, is investing $11.25 million. IFC is also providing an additional $3.75 million subordinated debt to the bank.
"We are happy to partner with BDF as it continues to grow and improve access to finance by expanding its lending operations,” said Marcos Brujis, Head of the IFC Capitalization Fund, a $3 billion fund which was made possible by commitments from IFC and Japan Bank for International Cooperation (JBIC).
IFC’s long-standing relationship with BDF dates back to 2007, when IFC extended a senior housing loan to BDF. This was followed by a trade finance line, which helped the bank support trade flows during the global financial crisis, and a credit line for small and medium enterprises (SMEs). This investment is expected to further strengthen the relationship by financing growth while promoting sustainable business practices across multiple projects. The increased access to financing to underserved SMEs in Nicaragua will allow Banco de Finanzas to expand and improve operations.
“This new investment will allow us to continue supporting our customers’ businesses and help fund the expanding housing sector, an area that needs financing in Nicaragua,” said Juan Carlos Arguello, BDF’s CEO. BDF serves more than 108,000 clients and has 29 branches across the country.
Nicaragua became an IFC member in 1956. Since then, IFC has invested $577 million in the country’s private sector, including $152 million in mobilization. IFC’s strategy in Nicaragua focuses on promoting access to finance for micro, small, and medium enterprises and supporting the expansion of leading firms throughout the region.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
.
About IFC Asset Management Company
IFC Asset Management Company LLC, a wholly-owned subsidiary of IFC, invests third-party capital, enabling outside investors to benefit from IFC’s expertise in achieving strong equity returns, as well as positive development impact in the countries in which it invests. It manages $6.3 billion of capital across six investment funds.
About the IFC Capitalization Fund
The IFC Capitalization Fund is a global equity and subordinated debt fund supported by commitments from IFC and JBIC. It aims to strengthen banks considered vital to the financial system of emerging markets.
About JBIC
Japan Bank for International Cooperation (JBIC) is a policy-based financial institution wholly owned by the Japanese government, which has the objective of contributing to the sound development of Japan and the international economy and society, by conducting financial operation in the following four fields: Promoting the overseas development and securement of resources which are important for Japan; Maintaining and improving the international competitiveness of Japanese industries; Promoting the overseas business having the purpose of preserving the global environment, such as preventing global warming; Preventing disruptions to international financial order or taking appropriate measures with respect to damages caused by such disruption. For more information, visit
www.jbic.go.jp/en
.
