36053 - Consorcio RE

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Summary of Investment Information

Project Number

36053

Company Name

Banco Consorcio

Date SPI Disclosed

Mar 17, 2015

Country

Chile

Region

Latin America and the Caribbean

Projected Board Date

Apr 20, 2015

Environmental Category

FI-1 - Significant

Status

Active

Last Updated Date

Nov 30, 2016

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : May 1, 2015
Signed : May 14, 2015
Invested : Aug 31, 2015

Sector

Commercial Banking - General

Project Description

The proposed transaction aims to support Banco Consorcio in Chile (“the Bank”) through a senior loan which would facilitate resources for sustaining the Bank’s capacity to provide project financing for smaller Non-Conventional Renewable Energy (“NCRE”) projects that IFC cannot reach directly.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	60.0
Equity

Development Impact

The Project will foster the creation of new NCRE sources that have a low environmental impact (solar, wind, small-hydro and geo-thermal) with lower GHG emissions.

Financing for additional energy sources will help mitigate the energy shortage and improve energy self-sufficiency in Chile.

The Project is also expected to have a strong impact on job creation, both directly and indirectly. Renewable energy projects require substantial construction work, a strong job generator especially for people in the bottom of the social pyramid.

The project is expected to create the following benefits, which would not be possible without IFC''s support:
- The funds will be destined in its entirety to a pipeline of NCRE projects which may otherwise not receive adequate funding.
- IFC will be supporting and establishing a long term relationship with a medium-sized player in the Chilean Banking sector, 100% locally-owned, with a clear environmental impact agenda.
- IFC can potentially contribute to the enhancement of the Bank''s Environmental and Social practices. Through its participation, IFC can ensure that only projects that meet IFC''s stringent performance standards are financed.

E&S Category Rationale / Risks and Mitigation

The Project has been classified as Category FI-1 according to IFC''s Environmental and Social Review Procedures. Renewable Energy (RE) Loans currently represent under 5% of the total loan portfolio. Existing RE sub-projects are of medium E&S risk nature, however the potential pipeline includes sub-projects such as hydro power plants, wind and solar power generation facilities. These likely entail potential significant adverse environmental or social risk and impacts that are diverse, irreversible or unprecedented.

The key risks and impacts derive from Banco Consorcio's capacity to implement a management system able to identify and manage the potential environmental and social risks associated to sub-projects. Risks may include but are not limited to: (i) air emissions, waste management, hazardous materials; (ii) OHS (occupational health and safety) risks such as process safety, gas releases, chemical hazards and fire and explosions; (iii) community issues such as land acquisition, health, safety and security; potential impacts on indigenous and other vulnerable communities; (iv) biodiversity conservation and stakeholder engagement. Currently, the Bank does not have a formal ESMS or E&S capacity.

Contacts

For Inquiries About the Project, Contact

Ignacio Ossa
CEO
El Bosque Sur 130, Piso 7
Las Condes, Chile
Telephone: + 56 2 2787 1800

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IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

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Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

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Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

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Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

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CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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Task Title & Description	Anticipated Completion Date
Nominate officers	05/15/2015
Establish SEMS	06/15/2015
Formalize procedures	06/15/2015
Develop guidelines	06/15/2015
Staff Training	12/12/2015
SEMS Implementation Test Phase	03/11/2016

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