The IFC is to provide US$5mn in guarantees to Banco Improsa in Costa Rica to expand the bank’s capacity to provide trade finance, and US$20mn in long-term financing to expand access to finance for local small and medium enterprises (SMEs).
Under the terms of the transaction, half of IFC’s US$20mn financing to Banco Improsa could be convertible into common shares of Grupo Financiero Improsa, the bank’s holding company.
In addition to the financing, Banco Improsa strengthened its relationship with IFC by joining the corporation’s global trade finance facilitation programme, which supports trade with emerging markets by providing risk mitigation through guarantees and expanding banks’ capacity to provide trade finance. By joining the programme, Banco Improsa becomes a new issuing bank with access to a global network of international bank relationships.
Franco Naranjo Jimenez, Banco Improsa’s general manager, says: “IFC’s financing and our incorporation to its global trade finance programme will help us further support SME operations in Costa Rica, which are an essential engine from economic growth and job creation in the country. We welcome this partnership with IFC and look forward to strengthening it in the future.”
Atul Mehta, IFC director for Latin America and the Caribbean region, comments: “IFC support to Banco Improsa is part of our strategy to expand access to finance for key productive sectors in Costa Rica and Central America. We also share Banco Improsa’s vision about the importance of strengthening the capacity and operations of SMEs through the services it provides with the Centres of Support and Advisory Services. We look forward to a long-term relationship with Banco Improsa.”
IFC is expanding operations in Central America and is increasing its role in the Costa Rican trade finance market with a focus on SMEs. Since launching the global trade finance programme, IFC has issued US$1.6bn in guarantees to facilitate trade flows with Latin America and the Caribbean.
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