38049 - Vitas Leb II

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Summary of Investment Information

Project Number

38049

Company Name

VITAS SAL

Date SPI Disclosed

Apr 25, 2016

Country

Lebanon

Region

Middle East

Projected Board Date

May 31, 2016

Environmental Category

FI-3 - No Impact

Status

Completed

Last Updated Date

Jun 12, 2021

Department

Regional Industry FIG MCT

Industry

Financial Markets

Previous Events

Approved : Aug 5, 2016
Signed : Aug 22, 2016
Invested : Oct 17, 2016

Sector

Microfinance and Small Business - Non Commercial Banking

Project Description

The project involves a senior loan of up to US$ 4 million to Vitas S.A.L., a leading microfinance institution in Lebanon (“Vitas” or the “Company”). Proceeds of the loan will be used to support the Company loan portfolio growth and increase access to funding needs of micro entrepreneurs and low income people in Lebanon, and create jobs through greater financial inclusion as it targets segments and geographies underserved by the financial system (the “Project”).

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	4.0
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 Microfinance Borrowers

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

Development Impact

(i) Contributing to the growth of microfinance sector: by supporting one of the main microfinance providers in the country to expand its outreach and serve a larger number of low-income individuals.

(ii) Increased access to finance to women: the social impact of the proposed project would be significant especially that women account for more than 38% of Vitas client base.

(ii) Job creation: MSMEs are key contributors to job creation in the Country. Funding the underserved microfinance sector can play a significant role in private sector led economic growth, generating employment and providing opportunities to the poor.

IFC''s additionality through this project would be to support VITAS, one of the top regulated microfinance institutions in Lebanon, to provide most needed funding to the underserved segments in the country. Through this project, IFC shall be able to provide medium/long term funding to VITAS which would help support its liquidity position, and its anticipated growth, in addition to helping the Company to diversify its funding mix. Moreover, IFC would demonstrate its continuous support to Vitas as a long term partner with both advisory and investment services. Moreover, IFC is expected to act as a catalyst by encouraging other international investors to further invest in the microfinance sector.

E&S Category Rationale / Risks and Mitigation

The proposed project has been classified as category FI-3 according to the IFC’s Sustainability Policy. The proposed project is a senior loan to VITAS S.A.L., one of the largest microfinance providers in Lebanon. Vitas current portfolio entails low environmental and social risk activities including predominantly retail trade, services and individual home improvement. The overall portfolio risk is considered to be low and to carry no adverse environmental and social impacts. The target market is low-income business owners who have existing or startups businesses and living mostly in rural areas. Targeted clients are those who have limited or no access to financial services and clients who need to be reached through none electronic types of direct marketing, and promotion. For this project, Vitas will be required to screen financing activities against the IFC Exclusion List and relevant environmental and social laws and regulations. Vitas S.A.L. will be required to: i) revise and implement the ESMS to ensure that lending provided complies with relevant E&S laws in addition to the IFC Exclusion List, ii) ensure an ESMS Officer has been designated at all times; iii) provide staff members responsible for E&S issues with the necessary training for implementation of the ESMS.

Contacts

For Inquiries About the Project, Contact

Mr. Ziad Halaby
General Manager
4th floor, S & S center,
Jisr El-Bacha road
Hazmieh Lebanon
Tel:+961 5 959 859
Fax: +961 5 957 857

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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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