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Panama City, Panama, June 12, 2014
— IFC, a member of the World Bank Group, provided a $40 million loan to Panama’s Multibank Inc. to expand access to finance for small and medium enterprises and support climate-friendly initiatives, including energy efficiency upgrades and small-size renewable energy projects.
Panama’s banking sector is the largest in Central America in terms of assets. However, few small and medium enterprises have access to longer-term financing required to make capital investments. IFC’s seven year senior loan will allow Multibank to provide its clients with longer-term funding, enabling them to undertake projects with more appropriate financing structures.
With IFC’s support, Multibank will also be able to offer loans to promote climate-smart projects that can lower greenhouse gas emissions and encourage more efficient energy use. Despite abundant hydropower resources, Panama’s high electricity demand means that it is still reliant on expensive, thermal energy sources such as diesel and fuel oil for nearly half of its electricity generation. Reducing energy consumption is important to raising the efficiency of Panama’s private sector.
“We are excited to expand our strategic partnership with IFC,” said Isaac Btesh, President of Multibank. “In addition to financing, IFC brings global and technical experience that will strengthen our position in Panama’s financial system, particularly for small and medium enterprises and in climate smart projects.”
This is IFC’s second transaction with Multibank. The bank became an IFC client in 2009 when it joined IFC’s Global Trade Finance Program with a $65 million trade line, which has since been increased to $75 million.
“This new operation shows IFC’s commitment to working with key players that contribute to Panama’s social and economic development and support a more inclusive financial marketplace,” said Angela Maria Fonseca, IFC’s Country Head for Panama. “The proposed investment is well aligned with IFC’s strategy and fills important gaps, particularly for entrepreneurs who need financing to grow their businesses, and for financing climate-friendly projects.”
IFC’s committed portfolio in Panama amounts to $602 million. In Panama, IFC is supporting financial intermediaries, infrastructure and education, by increasing access to finance for micro, small, and medium enterprises, improving cellular networks, and supporting the expansion of the Panama Canal. IFC is also engaged in fostering renewable energy, with hydro, geothermal and wind-based energy projects to help transition Central American countries to a cleaner and more efficient energy matrix.
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
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About Multibank, Inc.
Multibank Inc. is a universal bank that was established in 1990. Today, the Bank provides a broad range of commercial and retail banking services to its customers. Multibank Inc. has 7 local subsidiaries that provide factoring, leasing, insurance and brokerage services. Multibank Inc. ranks third and ninth by total assets and loans, respectively, among local private owned banks, with a market share of 3.7% in total assets and 4.1% in loans as of December 2013. As of December 2013, Multibank Inc. employs 1,470 professionals, has 28 branches in Panamá, and also operates subsidiaries in Colombia, Costa Rica, and representative offices in Peru and Colombia. Multibank Inc. has outstanding bond issues and preferred shares, registered and publicly traded on the Panama Security Exchange. Currently Multibank Inc.’s long term international risk rating by Standard & Poor’s stands at BB+, with a positive perspective and by Fitch Rating NY stands at BB+, with a stable perspective, only one notch from investment grade. For more information, visit
https://www.multibank.com.pa/en/default.html
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