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Bancóldex Emergency Line for MSMES

Project number 13100-01
Country Colombia
Sector Financial Institutions
Status In implementation

Basic information

Company name
Banco Comercio Exterior de Colombia S.A. ("Bancóldex")
Investment type Loan
E&S category
FI-3
Disclosed date
Projected board date
Approval date
Signed date
Team Leader
Acuna Cubillos, Piedad Lucia

Financial Summary

Syndicated Amount $ 20,000,000
Financing amount $ 100,000,000
Financing Currency
USD

Client
information

Client Contact Name: Claudia González
Title: Financial Vice-President
Phone Number: +57 436-3000

PROJECT
SCOPE
AND
OBJECTIVE

The project consists of supporting Banco de Comercio Exterior de Colombia S.A. (“Bancóldex”), with a senior loan. The total amount of the loan is up to US$170 million, composed as follows: (i) A loan from IDB Invest for an amount of up to US$100 million; (ii) US$50 million mobilized through possible co-financing to be financed by IDB Invest in its capacity as administrator of the China Co-financing Fund for Latin America and the Caribbean (the “China Fund”); and (iii) Co-loan from Development Finance Institute Canada (FinDev Canada) for an amount of up to US$20 million. The resources will be used to support MSME’s needs through the emergency line Program “Colombia Responde para Todos” or through other financial instruments created to alleviate the current COVID-19 situation.

"Colombia Responde para Todos" is an emergency line which seeks to expand financing to MSME’s from different economic sectors, through financial intermediaries. IDB Invest loan and support is key to provide liquidity and short to medium term resources to MSMEs so it’s sustainability and feasibility is ensured in a context of cash flow pressure due to the lockdown and economic activity paralysis.

Environmental
and
Social
Review

  1. Overview of Scope of IDB Invest E&S Review The environmental and social review of the proposed transaction was carried out through desk research and phone calls with the client.  Bancóldex is an existing IDB Invest client. 
  2. Environmental and Social Categorization and Rationale The proposed operation is classified as an FI-3 according to the IDB Invest Sustainability Policy. Bancóldex has requested an emergency credit line to support micro and SME client’s sub-borrowers primarily through short term working capital funding to address immediate financing needs as a result of the COVID-19 pandemic. Roughly 55% of the funding will go to micro and small enterprises, and the remaining to medium sized enterprises. The dominant sectors within this segment include commerce (37%) and small manufacturing (36%).  Average loan sizes are US$17K, US$56K, and US$164K for micro, small and medium sized enterprises respectively.  The average tenor is 2.5 years. As a second-tier bank, Bancóldex will channel funds through approved Colombian financial intermediaries in reaching the target MSME clients.   
  3. Environmental and Social Risks and Impacts The main E&S risks of this project are associated with Bancóldex’s capacity to identify and manage the E&S risks associated with its lending activities. Bancóldex has a well-developed Environmental and Social Management System that it applies at the level of direct operations and through Financial intermediary clients. The environmental, social, health and safety (“ESHS”) impacts and risks associated with sub-loans through this emergency credit line are expected to be minimal in nature.
  4. Mitigation Measures Bancóldex will be required to apply local law, the IDB Invest list of excludes activities, and their existing ESMS in operations for which a more detailed E&S review is required. Additionally, Bancóldex will undertake IDB Invest’s online training course.
  5. E&S Action Plan: N/A
  6. Contact Information For project inquiries, including environmental and social questions related to an IDB Invest transaction please contact the client (see Investment Summary tab), or IDB Invest using the email divulgacionpublica@iadb.org. As a last resort, affected communities have access to the IDB Invest Independent Consultation and Investigation Mechanism by writing to mecanismo@iadb.org or MICI@iadb.org, or calling +1(202) 623-3952.
For inquiries, comments and requests about the project

For inquiries, comments and requests about the project

Information Request