Banco Atlantida is 87.18% owned by Inversiones Atlantida S.A de C.V. (“INVATLAN”), which at the same time is controlled by four prominent Honduran families Bueso, Vinelli, Goldstain and Mendoza, and the Bank’s employee pension fund (Fondo de Retiro Bancatlan) and Fundaciones Iris Ulargui. INVATLAN is a financial conglomerate that also includes an insurance company (Seguros Atlantida) and six other companies.

The proposed investment consists of a 7-year secured Senior Loan for up to $50 million to fund the origination of long-term energy efficiency, renewable energy and cleaner production sub-loans. The total amount will be composed of a $45 million A Loan for IFC’s own account and a $5 million Canada Climate Change Program Loan.

45.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	45.0
Equity

* These investment figures are indicative

The Bank began operations in 1913 in the North Cost of Honduras. It is headquartered in Tegucigalpa. It is a nationwide corporate oriented Bank with diversified funding sources and the only Bank with presence in the 18 departments of Honduras through a network of 130 full branches, 55 express branches, 500 ATMs, 19 drive through outlets, and 296 banking correspondents. The Bank has four main business lines: Corporate/SME, Commercial Banking, Consumer Banking, International Banking/Remittances and Trusts/Fiduciary Management.

- The Project expects to address climate change by reducing GHG emissions through the use of alternative energy sources and cleaner technologies. - It will help transform the energy matrix and reduce dependency on volatile imported fuel prices and subsidies for costly thermal energy power sources; ultimately will help alleviate public budget constraints. - IFC will contribute to the creation of new direct and indirect jobs during the design, construction and operation of the sub-projects. - Consumers will have improved access to more reliable and less costly sources of energy; - Implementation of clean technology projects will facilitate the transfer of modern production techniques to Honduras which may be followed by new entrants into the sector.

IFC will fill a market gap by supporting a local commercial bank in its initiative to finance sustainable energy and clean technology projects, both highly underserved sectors. Such financing has been constrained in part due to the lack of proper financing conditions for small enterprises, such as longer tenors, as well as limited project finance capabilities and technical expertise of the local banking system. In addition, IFC intends to provide AS support to Bancatlan in Sustainable Energy Finance to build up its capacity, which is expected to mitigate some of the operational and financial risk of the IFC investment.

This Project will support the expansion of Bancatlan''s portfolio of renewable energy sub-projects and has been classified as Category FI (Financial Intermediary). The main E&S risks are related to the Bank''s investments in hydro and other renewable energy sub-projects, which could have potentially high E&S impacts. As such, IFC reviewed the pipeline of potential sub-projects to be supported through this transaction as well as the Bank''s existing capacity to manage their E&S risks. As part of this investment, Bancatlan will conduct an E&S due diligence of sub-projects to determine compliance with the applicable national E&S laws and regulations of Honduras and IFC''s Performance Standards, requiring corrective actions as necessary to ensure that the sub-projects meet these requirements.

Furthermore, the Bank will be required to: develop an E&S review procedure, to the satisfaction of IFC, to ensure that the investments/activities under this Project are in compliance with the IFC Exclusion List, the applicable E&S laws and regulations of Honduras, and the IFC Performance Standards (the applicable requirements), identify responsible and qualified persons to conduct the E&S due diligence based on the applicable requirements, require corrective actions as needed to ensure that sub-projects meet the applicable requirements, and submit a periodic report to IFC as per a format to be provided by IFC. In addition, Bancatlan will embrace IFC''s Performance Standard 2 (PS2) on Labor and Working Conditions to follow international labor best practices.