Fundacion Microfinanzas BBVA (51% share) was created by the Spanish banking conglomerate Banco Bilbao Viscaya Argentaria (“BBVA”) in 2007 with an initial capitalization of €200 million, as an initiative geared at enhancing microfinance through debt and equity investments in MFIs and banks catering to the sector. Corporación Mundial de la Mujer de Medellín (24.5% share) and Corporación Mundial de la Mujer Colombia (24.5% share) were created in 1985 and 1989, respectively, as NGOs affiliated to the Women’s World Bank. Given their status as nonprofit foundations, there are no sponsors in terms of equity ownership. The ultimate responsibility of the institutions falls under their respective Board of Directors, composed by reputable Colombian citizens.

The proposed investment will support the Bank’s growth and will be up to $30 million.

30.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	20.0
Equity	10.0

* These investment figures are indicative

Bancamia is headquartered in Bogotá, the capital city, and covers 20 out of the 32 country’s departments through more than 100 branches.

The development impact indicators for this project will include: Increased access to micro entrepreneurs in terms of amounts and the number of clients. Expanded geographical reach on financial services. Improving asset quality of portfolio. Enhanced capacity in environmental and social management.

IFC’s additionality in this transaction stems for the fact that by designing the project as a blend of advisory services, equity and debt, IFC is acting as more than just a financier for Bancamia, in fact it is being seen by management and shareholders as an advisor and partner geared at facilitating the growth of the Bank. The intention of IFC to subscribe Bancamia’s bonds will provide confidence to the market and allow Bancamia to attract institutional investors and fund itself successfully in the local capital market. This will allow Bancamia to improve its funding profile and asset-liability management. In addition, having IFC as a sponsor will strengthen Bancamia’s credit rating, as rating agencies continue to increase the importance of strong technical and financial sponsors in a financial institution. A strong credit rating will allow the Bank to enhance its credibility with lenders and depositors in a shorter period of time. Advisory Services has been supporting Bancamia’s transformation process to a regulated entity through risk management, product design and human resources.

This project involves IFC support for the business of Microfinance and has been classified as a Category FI project. Under an existing project, #28179, the client was required to: (i) implement and maintain a Social and Environmental Management System (SEMS) to ensure that all its investments are screened and processed to avoid supporting activities in the microfinance exclusion list, (ii) nominate an SEMS Officer and (iii) submit annual reports. The same requirements will continue to apply under the new project. The client has nominated the SEMS Officer and submited reports. The SEMS implementation will be a condition of disbursement. In addition, the client will be required to demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions.