Washington, D.C., March 30, 2010
—IFC, a member of the World Bank Group, today signed an agreement to invest up to $19 million in Panamanian-based QBE del Istmo Compañía de Reaseguros, Inc. to help the reinsurance company strengthen its capital base, improve corporate governance standards, and offer new products such as microinsurance and health insurance.
QBE del Istmo operates in more than 20 countries in Latin America and the Caribbean. IFC’s investment includes up to $9 million in common equity stock, or up to a 7.5 percent capital share, and up to $10 million in preferred stock, part of a $27 million joint financing package being provided with the Inter-American Investment Corporation. The money will support the company’s strategic regional expansion.
Giri Jadeja, Senior Manager for IFC Financial Markets, said, “This project is part of IFC’s strategy to scale up our insurance business in the Latin American and Caribbean regions. We consider QBE del Istmo as a reliable and strategic insurance partner to help us promote international best practices in risk management and boost the level of reinsurance and insurance access in the regions.”
Ramon Fernandez Q., Chairman of the Board of QBE del Istmo, said: "IFC's investment is a vote of confidence in QBE del Istmo and in the future of the Latin American and Caribbean insurance industry. IFC’s financial strength and experience will be invaluable as the region strives to develop its financial infrastructure.”
The investment in QBE del Istmo is part of IFC’s broader strategy to create opportunities for growth. Economic growth and sustainable development in Latin America and the Caribbean is hurt by the limited availability of affordable insurance and reinsurance products for individuals and local businesses. IFC works to provide equity and capacity-building services to locally based insurance and reinsurance companies that have a regional focus.
IFC is the only international financial institution focused exclusively on the private sector, the engine of sustainable development in emerging markets. Along with IBRD, it is currently seeking a capital increase to strengthen its ability to create opportunity for the poor in developing countries—including by helping extend insurance access in Latin America and the Caribbean.
MBA Lazard acted as exclusive financial advisor to QBE del Istmo on this transaction.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing capital for private enterprise, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit
www.ifc.org
.
About QBE del Istmo
QBE del Istmo is a full-line reinsurer with over 30 years in the Latin American market. Headquartered in Panama, the company has reinsurance, insurance, brokerage, and dental service operations throughout Latin America. As of December 2009, QBE del Istmo had written premiums of about $164.5 million and shareholder’s equity of $81.9 million. The company’s business model is based on serving small to midsize local insurance companies in Latin America and the Caribbean, where its technical expertise is sought. For more information, visit
www.istmore.com
.
