IIC Attends The 40th FELEBAN Annual Assembly Having Reached A Milestone US$1,922,500,000 In Approvals In The Financial Sector

11/13/2006

Washington, D.C.- The Inter-American Investment Corporation (IIC) has approved US$1,922,500,000 in operations with financial intermediaries, including syndicated loans, between the start-up of its operations and the close of October 2006. Of the 146 financial sector operations approved since the IIC began operations, 20 were approved in 2006 to date; these total US$353 million and include US$146 million in B loans.

Over the past twelve months, the IIC achieved several firsts among the multilateral institutions that operate in Latin America and the Caribbean: issuing local-currency bonds in Colombia and, instead of swapping the proceeds, using them to fund local operations through leasing companies; and working with local banks as a funding vehicle in the transaction with Mexico's Banco Compartamos.

IIC financing for financial institutions in Latin America and the Caribbean is flexible in structure, terms, and methods of payment. It is also creative, providing new solutions for new needs, and has a streamlined approval process.

According to Steven Reed, the IIC's Deputy General Manager, "The IIC has stepped up its operations. For several years now, our work with financial institutions has been a key, integral part of our strategy and business plan. Our goal is to find ways to reach microenterprises and small and medium-size companies in Latin America and the Caribbean. To this end we not only work with banks but with all types of financial institutions: microfinance companies, leasing companies, and finance companies specializing in mortgage loans."

During 2006, the IIC's interest in meeting the needs of small and medium-size enterprises in the region—especially those facing the most difficulty in attracting financing—led it to structure operations with public and private institutions specializing in providing guarantees. Examples include the US$20 million operation with Fondo Nacional de Garantías in Colombia and the innovative financing provided with Garantizar, a mutual guarantee association that benefits cattle farmers and beef exporters.

The IIC also continued to support small banks in the region, such as Financiera Monex in Mexico, Financiera El Comercio and Banco Regional in Paraguay, and Financiera Cafsa in Costa Rica. Such support from the IIC is significant because it targets clients that are underserved by large banks in Latin American and Caribbean countries.

The IIC is working on new local-currency initiatives similar to those implemented in Colombia and Mexico. Transactions are nearing completion in Peru and Venezuela, and there are others in the pipeline. Local-currency operations accounted for 9.20% of the IIC's investments in 2006.

The IIC also advises its financial sector clients on developing environmental risk management systems. In 2006 it hosted its tenth environmental management workshop; 300 participants from more than 100 financial institutions have attended these workshops since they began in 1999.

The IIC's overall strategy is true to its core mission of helping bring the benefits of economic progress to those who need them the most.

The Inter-American Investment Corporation, a multilateral financial institution that is member of the Inter-American Development Bank (IDB) Group, 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. The IIC's mission is to promote the economic development of its regional member countries by stimulating 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.


Telephone in Río de Janeiro: 55 21 8236-3815

Contact: Steven Reed/Carlos Roa

Telephone: (202) 623 3981

Email: stevenr@iadb.org