The objective of the proposed loan is to provide Banco Rabobank International Brasil S.A. with a subordinated loan that is, in accordance with National Monetary Council regulations, considered as Tier II capital of the borrower. Ultimately, the loan proceeds will be applied to expand the activities of the bank connected with its portfolio of local receivables and rural finance for small and medium-size enterprises (SMEs) and individuals. These SMEs and individuals in Brazil require medium- or long-term financing in order to assist in their operations, or short-term financing for procuring goods and services from larger companies on better terms. Financing on appropriate terms will make it possible to generate direct and indirect employment and improve the financial structure of SMEs, which have limited access to financing with terms of more than one year.
Environmental Classification and Issues:
This is a Category III project according to the IIC’s environmental and labor review procedure because specific impacts may result that can be avoided or mitigated by adhering to generally recognized performance standards, guidelines, and design criteria. The bank already has an environmental management system in place and is a signatory to the Equator Principles. To better understand the IIC´s requirements, Banco Rabobank International Brasil S.A. has already sent two officers to attend the IIC´s financial intermediary environmental training seminar. In July 2007, at a seminar on the same subject, a Rabobank senior manager spoke about the bank’s experience in developing and implementing its environmental policy.