26407 - Advans Banque Congo

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Summary of Proposed Investment

Project Number

26407

Company Name

ADVANS BANQUE CONGO SA

Date SPI Disclosed

Sep 20, 2007

Country

Congo, Democratic Republic of

Industry

Financial Markets

Projected Board Date

Oct 22, 2007

Status

Completed

Sector

Commercial Banking - Microfinance and Small Business

Department

Regional Industry - FIG Africa

Environmental Category

Previous Events

Approved : Nov 15, 2007
Signed : Jun 6, 2008
Invested : Jun 27, 2008

Project Description

The project consists of a senior loan, an equity investment and a technical assistance funding for the establishment and expansion of Advans Banque Congo. Advans Banque Congo (or the Bank) will be a greenfield microfinance bank sponsored by Advans S.A. SICAR (Advans), an investment company, and Horus Development Finance, an associated French consulting firm with recognized expertise in microfinance. The Bank will specialize in providing a broad range of financial services to urban and semi-urban micro and small enterprises as well as low income groups and individuals in the Democratic Republic of Congo. It is expected that after five years the Bank will have nine branches and a loan portfolio of $27 million, comprising 20,000 customers. The purpose of the project is to expand crucial financial services to a sector that rarely has access to services offered by formal financial institutions.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	2.0
Equity	1.10

Development Impact

The project will have a high development impact considering that microfinance has been shown to play a major positive role in reducing poverty and unemployment in developing countries. The initiative will strengthen the provision of microfinance services in the Democratic Republic of Congo, where access to finance is virtually nonexistent for low-income populations. By creating a new institution able to sustain microfinance on commercial terms and following best practices, the project has the potential to generate a substantial increase in the long-term availability of financial services for the poor. The project will also show local banks that sound microfinance can be sustainable and generate attractive returns. As a consequence, it is expected that the interest of local banks in the microenterprise and SME sector will be strengthened.

This project involves IFC support for the business of microfinance and has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. Considering the nature of activities supported, the project will be required to:

- Develop a procedure relevant to its business process, prior to disbursement, that is satisfactory to IFC, and that ensures that all its investments are screened and processed to avoid supporting activities on the IFC Microfinance exclusion list;
- Identify qualified persons to manage and implement the procedure;
- Demonstrate commitment and resources to implementing the procedure;
- Submit a periodic report to IFC as per a format to be provided by IFC.

Contacts

For Inquiries About the Project, Contact

Claude Falgon, Director & Manager
Advans SA SICAR
69, Route d’Esch, L 1470,
Luxembourg

Telephone: +33 1 53 32 75 71
Fax: +33 1 53 32 75 76
E-mail: cfalgon@horus-groupe.com

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This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

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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