Fondo Nacional de Garantías

For inquiries and comments to IIC, contact:
IIC’s Communications Group
E-mail: divulgacionpublica@iadb.org

For project inquiries, including environmental and social questions related to an IIC investment, please contact the client or the IIC using the contact information provided above. In addition, project affected communities have access to the IIC Independent Consultation and Investigation Mechanism.
Tel:+1 (202) 623-3952
Fax: +1 (202) 312-4057
Address: 1300 New York Ave. NW Washington, DC. USA. 20577
E-mail: mecanismo@iadb.org or MICI@iadb.org

Project Number: 
CO3711A-01
Expected Consideration Date by the Board: 
11/29/2005
Date Posted: 
10/27/2005
Company: 
Fondo Nacional de Garantías S.A. (FNG)
Financing Requested: 
Sector: 
Financial Services
Location: 
Country: 
Scope Objective: 

Fondo Nacional de Garantías S.A. (FNG) is a mixed-ownership company governed by Colombia's industry and trade regulations and majority controlled by the Colombian government. It is regulated by the Superintendencia Bancaria de Colombia, the nation's bank regulatory agency. FNG's mission is to facilitate access to financing for Colombian Micro and SMEs (small and medium–size enterprises) by providing partial credit guarantees.

FNG is the only Colombian institution that provides credit guarantees to micro, small and medium-size companies. FNG works chiefly with clients of intermediary financial institutions participating in the automatic business guarantee program. FNG provides various credit guarantee lines: business, educational, low-cost housing, and institutional guarantees.

Under the joint IIC/FNG partial credit guarantee program, the Corporation will guarantee 50% of an FNG guarantee portfolio under the program acceptable to the IIC. Guarantee coverage under the program is 50% of the loan amount, so the IIC and FNG will each guarantee 25% of the loan amount, and the financial intermediary granting the loan will assume exposure for the remaining 50%. The IIC and FNG will therefore share the risk associated with jointly guaranteed portfolios.

The program's objective is to increase access to credit for small and medium-size enterprise in Colombia and encourage intermediary financial institutions to provide financing that will enable this important sector of Colombia's economy to meet its investment and working capital needs. It is estimated that 90% of Colombia's businesses are SMEs, generating between 60% and 70% of the nation’s jobs and some 40% of domestic production.

Environmental Review: 

Environmental Classification: This is a Category III project according to 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. Representatives of Fondo Nacional de Garantías S.A. will attend the IIC's environmental training seminar for financial intermediaries to learn about IIC environmental and labor requirements and practices.