As a wholly-owned subsidiary of Corporación Interfin, Banco Interfin’s primary businesses are corporate and retail banking. The group is well-diversified and provides a broad array of financial services including leasing, offshore banking, brokerage services, pension fund management, investment and merchant banking and asset management. Corporación Interfin is owned by the original group of 12 local Costa Rican entrepreneurs (who individually own between 3.0% and 15.0%, for a total of 83.7%); FMO (the Dutch development finance company) and CABEI (the Central American Bank for Economic Integration) together own 4.7% and the remaining 11.6% is owned by individual investors.

The proposed IFC financings are comprised of a - $15 million term loan to Banco Interfin to be used for on-lending and the discounting of lease receivables and - $5 million subordinated loan -to be counted as Tier II capital- to Corporación Interfin.

20.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	20.0
Equity

* These investment figures are indicative

Corporación Interfin’s primary subsidiaries are Banco Interfin (retail and corporate banking), Arrendadora Interfin (leasing), Interfin Valores (brokerage services and investment and merchant banking), Créditos Bisa Interfin (credit cards), Interfin OPC (pension fund management), Corporación Privada de Inversiones de Centroamérica (trade financing) and Transamerica Bank and Trust, Ltd. (off-shore commercial banking). All of the businesses are currently domiciled and operate in Costa Rica with the exception of the leasing business, which operates in each of the Central American countries, and the offshore business, which is located in Nassau, Bahamas. Banco Interfin, which represents 55% of the total assets of Corporación, acts as the primary provider for the broad array of financial services offered by the Group. As of December 31, 2002 Interfin had 780 employees and 16 branches. Customers have access to a network of 525 Automated Teller Machines (ATMs), including 22 that are owned by Interfin.

This is an FI Type 2 project. Interfin will need to demonstrate that its existing environmental management system is adequate to address the environmental and social issues of the projects to be financed under this new financing. Interfin must require all subprojects to be carried out and operated in compliance with the applicable environmental, health and safety (EH&S) requirements of the country where the subproject is situated. In addition, subprojects whose total cost is less than $500,000 must be consistent with IFC''s Microfinance Exclusion List. Subprojects whose total cost is $500,000 or greater must be carried out in accordance with IFC''s safeguard policies, be consistent with IFC''s Exclusion List, and meet the host country requirements. Interfin must obtain IFC clearance prior to making any loan or investment with IFC funds in any Category A subproject, and such a subproject must meet the applicable EH&S guidelines and safeguard policies of the World bank Group.
Location of environmental documents in locally affected community

- Project Development: In a region where SMEs still suffer from sufficient access to long-term credit, the project will enable a strong banking group to continue to efficiently and effectively provide financing to Costa Rican SMEs, which is essential to foster entrepreneurship, increase employment and contribute to higher standards of living. Facilitating the group’s growth strategy in the region will enable Corporación Interfin to provide more affordable and comprehensive banking solutions. - IFC Role: IFC’s role in this project goes beyond its traditional role in supporting local financial institutions that provide SMEs access to credit, in that it seeks to have stimulative effect on the integration of the Central American financial sector, which is key to improving the efficient provision of financial services to local clients. Financial sector integration is crucial to sustaining economic integration within Central America particularly in light of the accelerating globalization process and intensifying negotiations between Central America and the US on the free trade agreement. The small economies of the Central American region would benefit from economies of scale by integrating themselves, in particular, in physical and financial infrastructure.