Banco de la Producción, S.A. (BANPRO)

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Project Number: 
NI1047A-01
Expected Consideration Date by the Board: 
06/11/2002
Date Posted: 
05/10/2002
Company: 
Mr.Ramiro Ortiz Mayorga
Financing Requested: 
Sector: 
Financial Services
Location: 
Country: 
Scope Objective: 
Project Description: The project consists in a US$6.0 million Debt Facility (the "Facility") to increase the supply of standardized mortgage loans in the primary mortgage market, by providing Banco de la Producción, S.A. a leading mortgage loan originator with long-term funds. The funds will be used to help middle-income families finance home purchases. The target segment of the market is the lower end of the range of families who could access bank mortgage loans. The IIC funds must be used to finance the purchase of homes priced up to US$70,000, with an average price of US$50,000. The project is expected to generate about 120 new mortgage loans. The IIC will condition that all mortgage contracts be standardized and that property titles be adequately registered as part of the conditions for disbursement. In this way, the project will help the Nicaraguan financial sector in establishing the basic necessary framework for the successful development of primary and secondary mortgage markets.
Environmental Review: 
This is a Category III project according to IIC's environmental and labor review procedures. The mortgage transactions to be financed will have obtained the necessary permits from Managua's Ventanilla Unica de Construcción (VUC) that reviews all the plans and building systems, issues permits, and regulates developments. The city must approve the entire site development plan including the infrastructure, such as the proposed roads, electrical supply, telephone lines, trash collection, sewage collection system, sewage treatment in cases where the development is not connected to the city sanitation system, rainwater drainage system, transportation issues, street lighting, school issues, and connection to a potable water supply. All of the homes will have access to these basic infrastructure services. In order to ensure this, BANPRO will be required to report to the IIC on the compliance of the above. The quality of the homes and access to infrastructure services will also be confirmed during the annual supervision visit. In addition, BANPRO will send two employees to the IIC Environmental Management Training course in order to further raise awareness of potential environmental issues associated.