The sponsor of this project is Fundacion BBVA para las Microfinanzas, which owns 96,676% of Caja Nuestra Gente. The Fundacion BBVA was established in May 2007.

The BBVA Group is the first private international banking group to wholeheartedly embrace global micro-finance with direct investment via a non-profit foundation. The Foundation is a totally independent entity from the Bank though, the latter retained its rights to preserve Foundation’s mission by making any of its by-laws amendment subject to its authorization. There is no responsibility retained by the Bank with regard to Foundation’s ultimate success or failure. Generally, resources made available by the Bank to the Foundation are provided on arms length terms though on occasions certain individuals can provide professional services that are not compensated. There is no control either direct or indirect from the Bank. There are however informal channels to exchange views with the Bank on the Foundation’s intended acquisitions, financing structures, etc.

The total project cost is estimated at US$10 million, for a stake of up to 20%.

9.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	9.0

* These investment figures are indicative

Caja Rural Nuestra Gente is headquartered in Lima, Peru. The headquarters of the two Cajas and the Edpyme, which located in the cities of Arequipa, Trujillo and Tacna, have remained as main offices in each region. In addition, the resulted Caja has 46 branches located in the Provinces of Arequipa, La Libertad and Tacna and the surrounding areas.

The project is expected to have the following important developments impacts:

- Facilitate the long term access of MFIs equity and debt funding. 
- Foster the integration of microfinance institutions into the formal financial sector.

IFC will:

- Facilitate the Foundation’s access to the microfinance segment. For the Foundation it is often difficult to approach smaller MFIs as the latter do not make a distinction between the BBVA Foundation and the commercial banking group. IFC can use its developmental reputation facilitating the entry of the Foundation in the key markets, and

- Play an active role in supporting the network MFIs. As the Foundation is limited to making equity investments it needs a strategic partner as IFC to offer other financial service to its investee companies as technical assistance, senior or subordinated debt, guarantees, underwriting bonds, securitizations, etc., as well as introducing new products such as microinsurance, microleasing and microcredit for home improvements.

In addition:
Given that BBVA Foundation is in a start-up phase, it faces several constraints in regard to its ability to adequately analyze potential investments from a microfinance perspective. Through this partnership, IFC will help the Foundation at a critical learning stage, and

- IFC’s global experience in microfinance will help enhance the Foundation’s network not only in its investment activities but also in fostering and spreading best practices in various markets.

This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. During appraisal, IFC will analyze the FI portfolio and the activities proposed to be supported with IFC financing for types of transactions, size, and tenor and industry sectors and determine the Applicable Performance Requirements, if any, that would include a combination of:

The IFC FI Exclusion List and/or
The applicable National Social and Environmental Laws and regulations

IFC will also review, if required, the capacity of the FI to manage social and environmental risks and to establish and maintain a Social & Environmental Management System (SEMS). If required, IFC will suggest Supplemental Actions to address any gaps in the SEMS. Based on the review, the project will be required to:

Develop an, or upgrade, if necessary, any existing Social & Environmental Management System (SEMS), prior to disbursement to the satisfaction of IFC
Identify responsible, qualified persons to manage and implement the SEMS
Commit to implement the SEMS, to ensure that its investments/activities supported by IFC financing are in compliance with the Applicable Performance Requirements
Submit a periodic report to IFC as per a format to be provided by IFC