31754 - CCLP SocGen

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Summary of Proposed Investment

Project Number

31754

Company Name

SOCIETE GENERALE SA

Date SPI Disclosed

Nov 16, 2011

Country

World Region

Industry

Financial Markets

Projected Board Date

Dec 15, 2011

Status

Completed

Sector

Other

Department

Gbl Ind, Manufact, Agribus & Services

Environmental Category

Previous Events

Approved : Jan 12, 2012
Signed : Feb 24, 2012
Invested : Feb 28, 2012

Project Description

The project is for IFC and other development finance institutions, “DFIs” and commercial banks (“Program Participants”) to assume a funded risk participation for up to $250 million in the trade finance portfolio of the critical agri and energy inputs of Société Générale SA (“SocGen”, “SG” or “the Bank”), structured under IFC Critical Commodities Liquidity Program (“CCLP”) initiative.
CCPL is a public-private partnership (“PPP”) initiative that is part of IFC’s multi-faceted rapid global financial crisis response. It is a funded program of up to $4 billion that will be mobilized and disbursed in phases to provide IFC with a flexible platform from which to support the extension of liquidity to clients globally. The proposed total IFC investment would be up to $1 billion, which will be leveraged with resources from other DFIs as well as several international banks with an established footprint in emerging markets. Without this support, the risk of disruption in essential commodity flows to Africa is real.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	250.0
Equity

Development Impact

The CCLP-Bank facility is expected to have the following specific development impacts:
- Increase Liquidity: The Facility will ensure continuing and additional funding to the major agricultural and energy sectors in Emerging Countries, especially in Africa and IDA countries. This Facility will contribute to the Bank maintaining its level of business in commodity finance. Among other things, the Facility will enable traders to purchase from and finance agricultural producers, the mainstay of most economies in Africa, and ensure food security and income for the public at large, but especially to farmers.
- Strong Demonstration Effect by catalyzing other IFIs to Support Agri and Energy Finance: By supporting commodity backed finance and outreach in partnerships with banks, the facility will have a significant demonstration impact on other banks, especially local /regional banks to participate in funding the agricultural and energy sectors. This would ultimately help increase access to finance for critical economic sectors.
- A steady supply of critically needed refined oil products through regular channels will keep prices in check, remove parallel market incentives, improve affordability for the vulnerable poor and contribute to sustaining local economic activities.

This Project involves support for agricultural commodities, agricultural (e.g. fertilizers, crop protection) and energy inputs, and has been classified as Category FI. In addition to applying IFC''s Exclusion List as an applicable requirement, IFC will review the environmental and social (E&S) risks associated with the agricultural and energy commodities portfolio to be supported by the project. IFC will review the project by applying its own standards and applicable methodology, especially as it relates to harmful child/forced labor and biodiversity risks associated with the conversion of natural and critical habitats. This process will allow to exclude counterparts involved in agricultural and energy commodities that have significant E&S concerns in the countries where they are sourced/produced. IFC will review the Bank’s internal processes in respect of the proposed commodity portfolio.

Contacts

For Inquiries About the Project, Contact

Société Générale
GLFI/NAT
17 Cours Valmy
92897 Paris LA Défense cedex

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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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