CNG is the resulting company of the merger of Caja Sur, Caja Nor Peru and EdPyME Crear Tacna. The institution offers financial products to entrepreneurs in the coastal regions of Peru, primarily around Trujillo, Arequipa and Tacna. CNG is controlled by Fundación BBVA para las Microfinanzas with a 83.6% shareholding. IFC has a 16.4% shareholding. Fundación BBVA was established in May 2007 by the BBVA Group (“BBVA” or the “Bank”) as an independent entity. BBVA is the first private international banking group to wholeheartedly embrace global micro-finance with direct investment via a non-profit foundation.

The proposed loan or a partial credit guarantee for up to PEN56 million ($20 million equivalent) will strengthen and diversify CNG’s funding base.

16.20 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	16.20
Equity

* These investment figures are indicative

CNG is headquartered in Lima and has branches in 18 out of Peru’s 24 departments.

- Increased access to finance: If fully deployed, the loan and PCGs would help increase access to finance for micro entrepreneurs in Peru. CNG's portfolio is expected to increase by 20% on average annually during the life of the project from a base line of US$250 million in November 2010.

- Mobilization: Once the loan is repaid and IFC can provide credit enhancement for the Bonds through the PCG(s), based on past IFC transactional experience with credit enhancements for bonds, the Project is expected to mobilize approximately three times the IFC investment amount.

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. The key S&E risks of the project are associated with the portfolio of activities to be supported, which given the nature of the clients'' operations can be considered low. Under the existing project (No. 27292), the client has developed a satisfactory SEMS to avoid supporting activities on the IFC Microfinance Exclusion List and in certain cases check for compliance with applicable S&E laws and regulations. The same procedure would be a requirement under the new project. As part of this investment IFC will review the Nuestra Gente''s labor practices according to Performance Standard 2: Labor and Working Conditions.

Considering the nature of activities supported, the client will be required to: (i) maintain its Social and Environmental Management System to the satisfaction of the IFC; (ii) demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions; and (iii) submit a periodic report to IFC as per a format to be provided by IFC.