36917 - Pichincha SL

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Summary of Investment Information

Project Number

36917

Company Name

BANCO PICHINCHA S A

Date SPI Disclosed

Jul 7, 2015

Country

Colombia

Region

Latin America and the Caribbean

Projected Board Date

Aug 7, 2015

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : Aug 27, 2015
Signed : Dec 1, 2015
Invested : Dec 18, 2015

Sector

Commercial Banking - General

Project Description

The purpose of the proposed transaction is to support Banco Pichincha S.A in Colombia (“the Bank” or “Pichincha”) through subscription to bonds to be issued by the Bank, which would facilitate resources for existing operations and expansion of its lending to small and medium enterprises (“SME”) and students.

Pichincha has its origins in 1964 as a non-bank regulated financial company. It was acquired by Grupo Pichincha C.A. (the “Group”) in 1998 and renamed Inversora Pichincha. After achieving national coverage and a critical mass of clients, Inversora Pichincha was finally transformed into a commercial bank in 2011. Pichincha has positioned itself as a consumer focused bank, with education and payroll-deduction loans as its main products. The Bank’s corporate lending focuses mostly on SMEs rather than large companies.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	50.0
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Straight Senior Loan	Loans to SME Borrowers

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

The development impact of IFC''s investment in this project is expected to be high given that it will improve the Bank''s capacity to support SMEs and students, which will in turn stimulate growth, employment and poverty reduction. The Bank will be able to increase its outreach and sustainability, incorporating thousands of new entrepreneurs to the formal financial sector. The transaction, which will be structured as a bond, will also contribute to the development of Colombia''s capital markets.

IFC''s long-term funding would enable the Bank to diversify its funding. Furthermore, IFC will introduce international best practices in environmental policies, strengthening the Banks'' environmental management system.

The project will also enable IFC to strengthen its long term relationship with the Group, supporting its regional expansion and consolidating its local presence in the different countries across South America.

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
CORE - E and S Management Systems (Y/N)	Compliance/Enhancement		Not Available	Not Available	Not Available

E&S Category Rationale / Risks and Mitigation

The project involves IFC support to lending activities in the SME and education sectors. Pichincha has a diversified SME portfolio, with emphasis on sectors such as commerce, transport, industry and construction. The portfolio supported through this project is expected to include business activities that have potential limited adverse environmental or social risks or impacts that are few in number, generally site specific, largely reversible, and readily addressed through mitigation measures. The project has therefore been categorized as FI-2 in accordance with IFC’s Environmental and Social Review Procedure. For this project the Bank will be required to ensure that all loans in the asset classes supported comply with the IFC Exclusion List and the E&S local laws.

Contacts

For Inquiries About the Project, Contact

Javier Alfonso Garcia Diaz
Banco Pichincha S.A. Colombia
Cra. 11 No. 92-09
Bogotá, Colombia
Tel: +57-1-6501050
Web: http://www.bancopichincha.com.co

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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.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

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

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

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.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

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.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

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.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Task Title & Description	Anticipated Completion Date
Nominate officers	09/07/2015
Establish SEMS	09/07/2015
Enhance Grienvance Mechanism	12/06/2015

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