Can anyone apply for financing?
The IIC provides financing to companies in Latin American and Caribbean member countries without access to medium- or long-term financing on capital and financial markets. SMEs seeking IIC financing must be profitable ventures with growth potential in need of medium- or long-term funding to capitalize on their market potential. These companies must have capable management who share the IIC’s commitment to transparency and comply with national accounting, tax, and environmental standards and labor practices. Eligible SMEs are typically majority-owned by citizens of the IIC’s 26 developing member countries in Latin America and the Caribbean. In addition to SME profitability, the IIC attaches great importance to a company’s overall development impact.
What kinds of financing are offered by the IIC?
The IIC provides financing for loans, quasi-equity and equity investments, lines of credit to local financial intermediaries for onlending in the form of smaller loans, agency lines with local financial institutions, and guarantees for and investments in capital market offerings. Repayment periods can range from five to 15 years based on cash flow assessments, including a grace period of up to five years for repayment of principal. Loans are priced according to international market conditions, with variable interest rates based on the London interbank offered rate (LIBOR). In addition to these financing instruments, the IIC also provides technical assistance to SMEs under its FINPYME brand programs.
What criteria must my project meet to qualify for financing?
In order for a project to qualify for financing, the applicant must be from one of the IIC’s 26 developing member countries in Latin America and the Caribbean and demonstrate that the company in question is a profitable business venture with growth potential and sales typically ranging from US$5 million to US$35 million. The IIC finances expansion projects in all economic sectors (with the exception of the trade and manufacture of arms, gambling, and real estate speculation). It also finances new (greenfield) projects on a limited and selective basis. In addition, the IIC provides funding for all types of financial institutions serving the small and medium-size corporate market that are considered leading institutions, according to regulatory standards in the countries in which they do business. Most of the financial institutions considered for IIC financing are in the top quartile of the financial system in terms of asset quality, profitability, capital adequacy, and other measures of their financial soundness. The IIC is also an active investor in private equity funds targeted, at least in part, at companies with sales of US$35 million or less, focusing exclusively on Latin American and Caribbean companies. Companies working with the IIC are subject to its environmental and labor review procedure and all relevant project information is subject to public disclosure and must be available for public review at least 30 days prior to project approval.
Which sectors/industries are eligible for IIC financing?
The IIC may operate in practically any economic sector, provided the operation in question will benefit the economy of the host country, is keeping with the priorities of its government, and is consistent with IIC policies and guidelines. The Corporation will maintain a reasonable sector balance by limiting the maximum share of its portfolio in any given sector, in keeping with the exposure limits established in the IIC Operating Policy.
Is my company eligible for IIC financing?
You are eligible for IIC financing if your company is based in one of the following regional developing member countries of the IIC: Argentina, Bahamas, Barbados, Belize, Bolivarian Republic of Venezuela, Bolivia, Brazil, Chile, Colombia, Costa Rica, Dominican Republic, Ecuador, El Salvador, Guatemala, Guyana, Haiti, Honduras, Jamaica, Mexico, Nicaragua, Panama, Paraguay, Peru, Suriname, Trinidad and Tobago, and Uruguay.
What is the IIC’s investment range?
IIC loans and investments may represent up to 33 percent of the cost of a new project or up to 50 percent of the cost of an expansion project for an existing company. The IIC’s target market consists of companies with sales ranging from US$5 million to US$35 million. However, it will also work on a selective basis with companies whose annual sales exceed US$35 million.
What are the guidelines for planning and submitting an investment proposal?
Click here to consult the “Submit an Investment Proposal” page. Companies will also need to provide historical financial data (preferably audited) covering the last three years as well as financial projections. All information with regard to projects deemed eligible for IIC financing will be used for internal processing purposes and the client will be informed of the terms and conditions for the prospective operation.
Where can I submit my investment proposal?
Investment proposals can be submitted to firstname.lastname@example.org or by contacting a local IIC representative in Argentina, Chile, Colombia, Costa Rica, El Salvador, Guatemala, Nicaragua, Paraguay, Peru, or Uruguay.
What is the source of IIC funding?
The IIC strives to ensure its financial sustainability through the implementation of sound management and financial practices. The Inter-American Investment Corporation was established in 1985 with US$200 million in capital provided by its founding member countries. The IIC’s member countries, whose numbers have grown over the years, approved one subsequent capital increase as the Corporation expanded and demonstrated its ability to offer a wider range of products and operations. Also, as part of the IDB Group, the IIC was also granted a US$300 million credit line in 1997 to provide financing for SMEs.
How much does the IIC lend each year?
The IIC approved 71 projects for US$464.7 million in 2011, up from 49 projects for US$374.8 million in 2010. Additional information is available in IIC annual reports.
How much technical assistance does the IIC provide each year?
IIC technical assistance activities are funded mainly through trust funds established by the IIC in conjunction with donor countries. In 2011, the IIC took in US$4.4 million in donor commitments and performed 204 individual technical assistance activities and 30 FINPYME diagnostic reviews.
To which sector does the IIC lend the most?
Loans to financial intermediaries for onlending to small and medium-size local enterprises account for over 60 percent of the IIC’s portfolio.