Banco Sofisa Local Currency Guarantee Program
The IIC seeks to work with Banco Sofisa S.A. in helping small and medium-sized companies secure financing by guaranteeing up to 50% of loans booked by Sofisa, a local bank that is almost exclusively focused on SMEs in Brazil. By providing these partial loan guarantees, the IIC will allow Sofisa to extend a greater amount of financing to eligible companies than would normally be the case, due to the bank’s conservative exposure limitations. For the IIC, this program will allow it to extend lending to SMEs in local currency, thereby helping eligible companies that are not exporters and thus require local currency, rather than U.S. dollar, funding.
Environmental Classification and Issues:
This is a Category III project according to the IIC’s environmental and labor review procedures because specific impacts might result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. Each subproject will be required to comply with national environmental and labor laws, regulations and standards as well as IIC policies. To enable the Borrower to better understand the IIC’s requirements, Banco Sofisa S.A. shall be required to attend IIC’s financial intermediary environmental training seminar.