WASHINGTON, D.C., June 2, 1999 — IFC has approved up to US$50 million in financing for Corporación Financiera Nacional y Suramericana S.A. ("Corfinsura"), a development finance company (DFC) in Colombia, to help meet the company's long-term capital needs at a time when Colombia is experiencing a severe capital shortage.
IFC's financing package consists of $25 million in equity and a 10-year revolving credit facility of up to $25 million. The equity investment will enable the company to rebalance its capital structure, while the credit facility will allow the company to improve its asset-liability management when the market is volatile and to provide the industrial sectors with greater access to longer-term funding.
This investment in Corfinsura reflects IFC's continued confidence in Colombia despite a difficult economic environment over the last two years, said Karl Voltaire, IFC's Director of Latin America and the Caribbean. As Corfinsura revamps its operations in response to the country's newly de-regulated financial sector, focusing on merchant banking and corporate financing, it will serve as an example for other financial institutions, particularly DFCs, he predicted.
With Corfinsura's client base of more than 1,000 large and medium-sized industrial companies, the company can be an important element in the economic recovery of the Colombian corporate sector. Corfinsura will focus on strengthening its investment banking and advisory and financial services, benefiting local industries and the financial sector as a whole.
The mission of IFC, part of the World Bank Group, is to promote private sector investment in developing countries, which will reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses.
