50128 - Popular Senior

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Summary of Investment Information

Project Number

50128

Company Name

BANCO POPULAR S A

Date SPI Disclosed

Nov 13, 2024

Country

Colombia

Region

Latin America and the Caribbean

Projected Board Date

Dec 14, 2024

Environmental Category

FI-3 - No Impact

Status

Hold

Last Updated Date

Mar 23, 2026

Department

Regional Industry FIG LAC & EUR

Industry

Financial Markets

Previous Events

Approved : Jan 9, 2025

Sector

Commercial Banking - General

Project Description

The proposed investment consists of a social bond through a private placement in the Colombian secondary capital market to be provided to Banco Popular, S.A. (“Banco Popular” or the “Bank”) of up to US$75 million equivalent in Colombian pesos (“COP”). The proceeds of the facility will be used to promote access to finance for low-income individuals including senior citizens, and women (the “Project”).

The social bond will be processed under a Social Finance Framework that complies with ICMA’s Green, Social and Sustainable Bonds Principles, including use of proceeds directed to populations living in vulnerable conditions, aging populations, and women. The Social Finance Framework will have a Second Party Opinion.

Associated Advisory Engagement

The Project will be complemented with Advisory Services (“AS”) to support the Bank in developing the Social Finance Framework aligned with ICMA’s Social Bond Principles, under which the proposed transaction will be processed.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	75.16
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	Consumer Loans

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

Development Impact

The most significant expected Project-level outcome is increased assess to consumer finance for low-income households and underserved individuals including those that are part of the silver economy and women. Beyond the Project, IFC anticipates that the Project will demonstrate the commercial viability to other mid-sized banks to diversify their funding source through socially labeled bond issuances and is expected to attract potential investors to participate in local capital markets, especially in the social bond market.

IFC’s additionality in the Project is both financial and non-financial. Financial additionality will be provided in the form of financing structure, as IFC will provide long-term and local-currency funding, at a time when the banking sector is facing pressure in its profitability and asset quality indicators driven by high interest rates in the country. Non-financial additionality will be provided in the forms of knowledge, innovation, and capacity building, as IFC is providing Advisory Services to support the Bank in developing a Social Finance Framework, in alignment with ICMA’s Green, Social and Sustainable Bonds Principles.

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
Value of Outstanding Loans, Microenterprises	USDMill		Not Available	Not Available	Not Available

E&S Category Rationale / Risks and Mitigation

The project entails the issuance of a social bond of up to US$75 million by Banco Popular in Colombia to support its financial inclusion credit portfolio which includes low income pensioners and women. The project has been classified as FI-3 in accordance with IFC’s Sustainable Framework. Overall, the environmental and social (E&S) risks associated with the project are considered to be low given the focus on individuals. As part of the project, the bank will be required to inform IFC in case of any change in its portfolio that may affect the nature of E&S risk and remain committed to ensuring compliance with labor standards and procedures in accordance with PS2 and will continue to uphold them.

Contacts

For Inquiries About the Project, Contact

Banco Popular, S.A.
Oscar Rocha Murgas
Legal Representative – VP of Treasury and Subsidiaries

oscar_rocha@bancopopular.com.co
Cll 17 # 7-43 Bogotá
https://www.bancopopular.com.co/wps/portal/bancopopular/inicio/

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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.

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