40174 - CHG Syndication

Who We Are
Who We Are

IFC is the largest global development institution focused on the private sector in developing countries. By encouraging growth, IFC advances economic development, creates jobs and improves the lives of people.
More About Us
About IFC

Our Leadership

Development Partners
Accountability

Learn more about accountability
Annual Report

Download the Report
What We Do
What We Do

IFC advances economic development and improves the lives of people by encouraging the growth of the private sector in developing countries. We achieve this by investing in impactful projects, mobilizing other investors, and sharing expertise.
What We Do Overview
SOLUTIONS

Our products and services
OUR PRIORITIES

Climate Business

Fragile & Conflict Afflicted Situations

Gender

Mobilizing Private Capital

Sustainability
SECTORS & EXPERTISE

Agribusiness & Forestry

Creative Industries

Education

Financial Institutions

Funds

Health

Infrastructure

Manufacturing

Public-Private Partnerships

Tourism, Retail & Property

Trade & Supply Chain Finance

Venture Capital

Working Upstream
Where We Work
Where We Work

As the largest global development institution focused on the private sector, IFC operates in more than 100 countries around the globe. We apply lessons learned in one region to solve problems in another.
Overview
By Region

Africa

East Asia and Pacific

Europe

Latin America and the Caribbean

Middle East and Central Asia

South Asia
Our Impact
Our Impact

Our impact improves lives. IFC brings a clear set of advantages to the world’s most challenging markets. Including a history of innovation, a global mandate, and a determination to achieve measurable development impact.
Our Impact Overview
PRINCIPLES & MEASUREMENT

Impact Investing at IFC

Measuring and Monitoring (AIMM)

Evaluation

Sustainable Development Goals (SDGs)

Owned by 186 member countries and consistently rated AAA/Aaa. IFC aims to achieve our mission of promoting development by providing debt and equity to the private sector, through a range of benchmark and bespoke products.

For Partners

For Investors

Get in Touch

Summary of Investment Information

Project Number

40174

Company Name

CHONGQING ECONOMIC AND TECHNOLOGICAL DEVELOPMENT ZONE HOUZE SMALL LOAN COMPANY LIMITED

Date SPI Disclosed

Nov 1, 2017

Country

China

Region

East Asia and the Pacific

Projected Board Date

Jan 12, 2018

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Oct 13, 2023

Department

Regional Industry - FIG Asia & Pac

Industry

Financial Markets

Previous Events

Approved : Mar 28, 2018
Signed : Mar 30, 2018
Invested : Jul 16, 2018

Sector

Other Non-Banking Financial Institution (NBFI)

Project Description

Established in 2013 in Chongqing, China and sponsored by Clearwater Capital Partners, LLC (“Clearwater”), Chongqing Economic and Technological Development Zone Houze Small Loan Co., Ltd (“CHG” or the “Company”) focuses on providing debt financing to privately-owned residential housing developers in Southwest China, including the frontier regions in Southwest China. CHG is an existing client of IFC since 2016.

This proposed project is an up to US$75 million financing package, consisting of up to RMB100 million (approximately US$15 million) IFC A Loan and up to US$60 million and/or its RMB equivalent (can be increased to US$85 million in case of over-subscription) Syndicated Loan. The project represents IFC ’s continuous effort in supporting the private sector led affordable housing projects in China.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	101.21
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

1) Expanding Access to Finance for Private Sector Led Affordable Housing Projects: The Project will provide liquidity to build private sector led affordable housing projects to enable migrant workers, and lower income urban households in China to afford higher quality housing. The Project is expected to finance an additional 6,000 affordable housing units per year and benefit about 30,000 families; 2) Promoting Greater Market Competitiveness: The Project has the potential to promote greater market competitiveness by facilitating private sector participation in the supply side of the affordable housing market; 3) Promoting Greater Market Sustainability: With IFC's help, CHG has implemented its own E&S Risk Management System to effectively assess and monitor the E&S risks of its projects and kept improving the system. The adoption of high E&S standards can help promote greater market sustainability.

1) Long-term Finance: IFC is able to provide long-term funding, which is not readily available, of up to 5 years to support CHG's financing for private sector led affordable housing projects in China. 2) Positive Signal to the Market: IFC's further support would enhance the positive signal to the market that the business model developed by CHG is an important and sustainable way to fill in the financing gap of the private sector led affordable housing projects in China. IFC's further support could be followed by other commercial lenders and help diversify CHG's funding sources. 3) Resource Mobilization: The proposed financing package includes an IFC syndication, which is expected to mobilize funding from foreign lenders to support CHG, enhance CHG's image and credibility, and help CHG access other offshore funding in future. 4) Standard Setting: Building on CHG's efforts to put in place E&S standards as well as establish proper corporate governance procedures, CHG would continue to leverage IFC's expertise to enhance its E&S risk management and corporate governance.

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 proposed investment is categorized as an FI-2 project according to IFC's Environmental and Social Sustainability Policy. CHG provides loans to small and medium size developers in building affordable housing projects mainly in Chongqing, Southwest China. It is anticipated that the Project will entail limited adverse E&S risk and impacts that are few in number, generally site-specific, largely reversible and can be readily addressed through mitigation measures. CHG will be required to conduct E&S due diligence of and monitor its lending activities against the IFC Exclusion List, applicable Chinese E&S laws and regulations, and the Performance Standards (the Applicable Performance Requirements).

The main E&S risks and impacts of the Project relate primarily to the E&S risks of the real estate development activities as well as the company's capacity and systems in place to manage these risks, including the company's due diligence of land acquisition and legacy issues prior to commitment of loans; health and safety on site and management of labor and working conditions issues with construction workers; and community engagement. The company has developed an environmental and social management system (ESMS) for conducting E&S due diligence and monitoring of its lending activities following the Applicable Performance Requirements. The company will enhance its ESMS by adding an external communication mechanism for engagement with its stakeholders and will maintain proper capacity to continue to implement the ESMS. The company's HR management was found to be consistent with the requirements of IFC Performance Standard 2 on Labor and Working Conditions.

Contacts

For Inquiries About the Project, Contact

Chongqing Economic and Technological Development Zone House Small Loan Co., Ltd
Mr. Claude Gong
CEO
+86-23-6037-2380
cgong@chinahouze.com
Unit 33-11, Metropolitan Oriental Plaza, No. 68 Zourong Road, Yuzhong District, Chongqing, P.R. China
http://www.clearwatercapitalpartners.com

For Inquiries and Comments About IFC, Contact

General IFC Inquiries
IFC Communications
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

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
Develop guidelines	01/26/2018

Projects

Summary of Investment Information

Project Description

Sponsor / Cost / Location

Project Sponsor and Major Shareholders of Project Company

Total Project Cost and Amount and Nature of IFC's Investment

IFC's Investment as Approved by the Board

FIG Use of Proceeds/Beneficiaries

Location of Project and Description of Site

Development Impact

Anticipated Impact Measurement & Monitoring (AIMM) Assessment

IFC's Role and Additionality

Development Results

E&S Category Rationale / Risks and Mitigation

Environmental & Social Categorization Rationale / Key Risks & Potential Impacts

Environmental & Social Management System (ESMS)

Mitigation Measures / Environmental & Social Action Plan (ESAP)

Press-Release

Related Environmental Document

Similar Projects

Contacts

Information on E&S Complaints and Grievance Mechanisms

Disclaimer