47802 - BBVA PeruGreen2

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Summary of Investment Information

Project Number

47802

Company Name

Banco BBVA Peru

Date SPI Disclosed

Mar 31, 2023

Country

Peru

Region

Latin America and the Caribbean

Projected Board Date

Jun 13, 2023

Environmental Category

FI-2 - Limited

Status

Active

Last Updated Date

Aug 24, 2023

Department

Regional Industry FIG LAC & EUR

Industry

Financial Markets

Previous Events

Approved : Jun 13, 2023
Signed : Jul 3, 2023
Invested : Jul 10, 2023

Sector

Commercial Banking - Housing Finance

Additional Project Attributes

Blended Finance

Project Description

The proposed investment consists of a six-year, senior unsecured loan of up to US$400 million to Banco BBVA Perú (the Bank), a subsidiary of the Spanish banking group BBVA (the Group). The main purpose of the proposed investment is to expand the Bank’s green building loan portfolio in Perú. The project is expected to be supported by the Market Accelerator for Green Construction (“MAGC”) Program as described in the Blended Finance Section.

Associated Advisory Engagement

The project will also involve advisory services to provide technical support to real estate developers in the Bank’s green building loan program on EDGE and LEED certifications for residential units and other sectors (e.g., industrial, commercial, etc.) IFC will also support the Bank’s staff with knowledge and technical assistance to strengthen its green building and mortgage value added proposition for its business and retail clients as well as setting robust methodologies for the monitoring and reporting of its green building portfolio. Furthermore, IFC will provide advisory on environmental, social, and governance (ESG) issues to the Bank.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	200.0
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	Labeled: Green;Blue;Social-Loans/Bonds
Syndications	Labeled: Green;Blue;Social-Loans/Bonds
Syndications	Labeled: Green;Blue;Social-Loans/Bonds

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

Development Impact

IFC's long-term financing is expected to contribute to the growth of the nascent green building finance market in Peru. Furthermore, the transaction will alleviate the impact of climate change from buildings by strengthening the Banks’ ability to structure green building financing following international best practices. Beyond the project-level impact, IFC anticipates that the project will promote competitiveness in the financial and real estate markets. In addition, given the relatively underdeveloped state of the climate finance market in Perú, IFC’s engagement will build capacity and set standards, using tools to assess eligibility and track environmental impact.

E&S Category Rationale / Risks and Mitigation

The proposed investment consists of up to US$400 million senior loan to support BBVA’s green lending activities, such as green building construction, green housing, energy, water efficiency, transportation, and renewable energy, among others. The activities supported under the project are expected to be of a medium E&S risk nature, including a limited number of business activities that have potential adverse environmental or social risks or impacts that are few in number, generally site specific, largely reversible, and readily addressed through mitigation measures. Therefore, this project has been categorized as FI-2 in accordance with IFC’s Sustainability Policy. For the project, BBVA will be required to screen potential sub-projects against the IFC Exclusion List, host country laws and regulations, and the IFC Performance Standards, as applicable. Key risks of the activities supported may derive from the client's capacity to identify, assess, and manage risks associated with its green projects pipeline, which typically include occupational health and safety issues, labor and working conditions, child and forced labor, waste and wastewater management, land tenure, resource efficiency, pollution prevention, and impacts to vulnerable communities and biodiversity. High E&S risk or category A projects will not be eligible. Additionally, solar projects over 5MW or coal related activities will not be supported.

IFC will periodically disclose the names, locations and sectors for Category A sub-projects that have been supported by IFC investments through financial intermediaries, subject to regulatory constraints and market sensitivities. The sub-project(s) listed below reflect(s) the status of the portfolio as of July 1, 2020.

Part of the proceeds of the proposed investment would be used to finance real estate developers in the Bank’s green housing program.

As part of this project, the Bank will formalize its existing E&S risk screening procedures, develop an E&S management system to assess and manage risks of the supported asset class as well as train relevant staff that will oversee implementation and operation of the ESMS. BBVA will remain committed to applying its current labor standards, which are broadly aligned with the requirements of PS2: Labor and Working Conditions.

Contacts

For Inquiries About the Project, Contact

Banco BBVA Perú SA
Stefany Campos Gutarra
Manager, Investor Relations and Head of Budget Modeling & Planning
+515950000
rosa.campos.gutarra@bbva.com
Av. República de Panamá 3055, Piso 17, Lima, Perú
www.bbva.pe

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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	05/01/2023
Establish SEMS	02/01/2024
Staff Training	06/01/2024

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