34115 - RCBC Short Term

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Summary of Investment Information

Project Number

34115

Company Name

RIZAL COMMERCIAL BANKING CORPORATION

Date SPI Disclosed

Oct 11, 2013

Country

Philippines

Region

East Asia and the Pacific

Projected Board Date

Nov 15, 2013

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : Feb 6, 2014
Signed : Nov 5, 2014
Invested : Nov 13, 2014

Sector

Commercial Banking - SME Finance

Project Description

The proposed investment is part of IFC’s effort to support Rizal Commercial Banking Corporation (“RCBC” or the “Bank”), an existing IFC client, to increase its capacity to lend to small and medium enterprises (“SMEs”). The proposed project will allow RCBC to expand the volume and maturity of its US$-denominated SME loan portfolio. The proposed project is also consistent with both IFC’s Philippines and Financial Markets strategy of promoting an inclusive financial services industry by supporting lending to SMEs and micro-enterprises.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	30.0
Equity

Development Impact

1. Increased access to finance is indispensable to grow the competitiveness of SMEs. By directly financing the medium term US$ liquidity needs of local banks to support SME foreign currency requirements, the facility will support SMEs and will have a positive impact on economic activity in the country.
2. Continuing to contribute to the strengthening of environmental and social management practices in the country''s banking system.

IFC''s track record in investment and advisory services can guide the banks in their strategic expansion to other markets. IFC has a broad range of institutional and financial sector building experience in emerging markets, especially with regards to SME banking.
1. Supporting increased access to finance to underserved sectors of the economy, namely SMEs. IFC is providing medium-term US dollar financing to help the Bank grow its SME portfolio, thus providing the Bank with additional US dollar resources to on-lend to local SMEs.
2. Using its presence as a lender of the Bank to continue to bring best practices in areas of risk management and environmental and social management. As a partner, IFC could also strengthen the Bank''s SME lending strategy with its best practices through advisory services and access to IFC''s global knowledge on SME lending to improve the Bank''s capacity.

E&S Category Rationale / Risks and Mitigation

This transaction involves a senior loan aimed to support the client''s local SME business and the overall portfolio risk is considered to be limited. The project has therefore been categorized as FI-2 in accordance with IFC’s Environmental and Social Review Procedure. The bank''s total SME lending accounts for approximately 10% of the total portfolio and the main focus is on wholesale and retail. For this project the client will be required to screen and monitor its lending SME''s activities against the IFC Exclusion List and the applicable E&S laws and regulations.

Contacts

For Inquiries About the Project, Contact

Carlos C. B. Mercado
Senior Vice President / Head of Trading
RCBC Head Office, 8/F Yuchengco Tower I, RCBC Plaza
6819 Ayala Avenue, Makati City 0727
Philippines
+632 894-9016

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