Guatemala, February 2, 2022.- IFC, a member of the World Bank Group, is partnering with Banco G&T Continental in Guatemala to launch the Bank's climate finance business, expand access to finance for small and medium enterprises (SMEs), and offer affordable housing for Guatemalan families.
Guatemala is among the ten most affected countries in the world by extreme climate events, which hinders economic growth and affects social conditions, also triggering migration and increased poverty levels. Limited access to finance for climate-smart assets in the country further hampers sustainable and inclusive growth in the country. IFC's US $80 million-dollar funding will help G&T launch its climate finance business, a first in the country, focusing on financing green buildings and green housing projects.
SMEs account for 40 percent of Guatemala's GDP and 77 percent of employment, but the financing gap for this segment is estimated at US$15 billion, according to the World Bank. IFC's financing has a strong focus on pressing forward the Bank's strategy to expand access to finance for SMEs and help them remain competitive. In the same way, it aims to increase G&T's housing loans for low and middle-income households, addressing the country's low mortgage penetration rate of 1.8 percent, very low even when compared with other countries in Latin America.
"The COVID-19 pandemic hit the Guatemalan services, manufacturing, and construction sectors the hardest. But we are proud to see this year's economic output with indexes that surpassed pre-pandemic levels. The key is to continue supporting the private sector to accelerate recovery and ensure small businesses can keep operating and creating jobs," said Sanaa Abouzaid, IFC Country manager for Central America.
Marcelo Castellanos, Regional Manager for the Financial Institutions Group in Latin America, said that there are many business opportunities for financial institutions to offer innovative products to the SME segment, which remains underserved. "We've been working with G&T since 2008 and are excited to see them enter the climate finance business, exploring opportunities to boost climate-smart solutions in the country."
Enrique Rodriguez, CEO of Grupo Financiero G&T Continental, added that "the bank has always been characterized by its innovative quality and we are proud to be an important economic engine for Guatemala. We are aware that betting on sustainability generates benefits for our environment, society and also the economy and we gladly accept the challenge of promoting climate-smart solutions for the Guatemalan market."
IFC's financing is paired with advisory services aimed at offering its global expertise to help Banco G&T Continental establish its climate finance business.
About IFC
IFC, a member of the World Bank Group, is the world's largest private sector-focused development institution in emerging markets. We work in more than 100 countries, using our capital, experience and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 trillion to private companies and financial institutions in developing countries, harnessing the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit https://www.ifc.org.
Sobre Grupo Financiero G&T Continental
It is a Guatemalan financial organization, which is among the leaders in this market with a history of more than 60 years. Currently, the group is made up of several companies in the financial sector, including Banco G&T Continental, Financiera G&T Continental and Seguros G&T, S.A. However, it concentrates its largest commercial activity through the G&T Continental bank. The strength of the group is evidenced by its figures, which refer to a total of 1.5 million customers; more than Q63 billion in assets. Its human team has more than 5 thousand employees and the organization was accredited in 2020 with the ISO 9001/2015 Certification. G&TContinental's organizational culture is identified by its adaptation to change and continuous improvement; for its products and services, which seek to simplify the daily management of its clients' finances, the solvency of a large organization and a technological platform in constant evolution.
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