IIC Approves A Loan Of Up To US$300 Million Reais For Rabobank International Brasil S.A.
06/23/2008At least 700 producers are expected to benefit from this transaction
Washington, D.C. - On June 24, 2008, the Inter-American Investment Corporation (IIC) approved a loan of up to 300 million reais to Banco Rabobank International Brasil S.A., which is part of the Rabobank Group. It provides financing mainly to the agribusiness sector and has a substantial share of the SME market. The purpose of this operation is to provide Rabobank Brasil with a subordinated loan, which will be considered Tier II capital in accordance with local regulations.
Indirectly, the operation seeks to support the growth of the bank's portfolio in the agricultural sector, particularly in terms of rural producers and receivables investment funds. The transaction consists of an A Loan of up to 45 million reais to be funded by the IIC and a B loan of up to 255 million reais to be funded by other participating financial institutions.
This operation is very important for the IIC given its developmental impact and its potential to create jobs and generate exports. Financing from the IIC will also help Rabobank Brasil enter the market of loans under US$300,000. This will enable the bank to finance smaller farmers through standardized procedures and thus reach a larger number of rural beneficiaries, increase its lending volume, and improve portfolio diversification.
This is the IIC's fifth transaction with Rabobank Brasil. Previous transactions were very successful, with more than 112,000 beneficiary SMEs. This operation seeks to have an even greater multiplier effect and a significant impact by growing the Bank's portfolio of agricultural producers who do not have access to the banking system.
This is the IIC's first local-currency transaction with Rabobank and its second in reais in Brazil. With this operation the IIC seeks to eliminate the foreign exchange risk for small and medium-size beneficiaries.
The Inter-American Investment Corporation is a multilateral financial institution that is a member of the Inter-American Development Bank (IDB) Group. It provides financing (in the form of equity investments, loans, guarantees, and other instruments) and advisory services to private enterprises in Latin America and the Caribbean. In 2007, the IIC reached US$1.2 billion in assets and approved 62 transactions channeling US$470 million to SMEs in the region. The IIC’s mission is to promote the economic development of its regional member countries by encouraging the establishment, expansion, and modernization of private enterprises, particularly those that are small and medium in size. For more information on the IIC’s activities, please visit www.iic.int.
Contact: Santiago Cat (in Uruguay)
Telephone: + (598) 2915-3696