- Banco de las Microfinanzas Bancamía S.A. has successfully completed its second issue on the capital market with USD 42 million in bonds.
- The International Finance Corporation (IFC) purchased all the bonds issued by Bancamía.
The International Finance Corporation (IFC), an institution of the World Bank Group focused on the development of the private sector, purchased all the public offering of ordinary bonds issued by Bancamía for 100 billion Colombian pesos (around USD 42 million), with the aim of boosting the activities carried out in Colombia by this institution, which is part of the BBVA Microfinance Foundation Group.
The new funds will enable Bancamía S.A. to expand its microfinance operations in Colombia, where it is a current sector leader, serving more than 692,000 low-income customers through a network of 187 branch offices, many of them located in areas where the presence of financial institutions has been traditionally limited, such as the rural sector.
Bancamía has thus completed its second bond issue as part of its strategy designed to obtain funds to promote Productive Finance through the placement of loans aimed at the development of the country’s entrepreneurs.
“This transaction will enable us to balance the cash flow of customers in the rural sector, whose crop growing and cattle-raising are medium and long-term activities, with an issue that is providing us with funds for five years to promote the productive development of rural entrepreneurs, which is the most important line of activity of our institution. It is also an instrument that enables us to diversify lending for the Bank”, said María Mercedes Gómez, executive president of Bancamía.
This deal reinforces the IFC’s support for Bancamía, after it received an investment of 10 million dollars in 2010. The recent purchase of the bond issue also strengthens the strategic alliance signed in 2008 between the IFC and the BBVA Microfinance Foundation, aimed at strengthening the Foundation’s activities in Latin America.
The BBVA Microfinance Foundation is currently one of the key players in the region’s microfinance sector based on the number of clients attended individually. The MFBBVA is present in 7 Latin American countries and works through eight microfinance entities: Banco de las Microfinanzas Bancamía (Colombia), Financiera Confianza (Perú), Banco Adopem (República Dominicana), Fondo Esperanza and Emprende Microfinanzas (Chile), Contigo Microfinanzas (Argentina), Microserfin (Panamá), and the Corporación para las Microfinanzas (Puerto Rico).
The development of the microfinance sector has been a priority for IFC in Colombia as part of its effort to increase the penetration of the financial sector in the country. “This funding shows our support for achieving greater access to financial services by microentrepreneurs in Colombia and developing the country’s capital markets,” said Carlos Leiria Pinto, IFC manager for the Andean region.
In Colombia, the IFC supports sectors that are essential for the country’s social and economic development such as infrastructure, health, education, agroindustry and public-private associations, for building ports, roads and airports. It also promotes access to finance by microenterprises and SMEs and contributes to improving the investment climate, simplifying regulations and royalties management. The investment portfolio of the IFC in Colombia amounts to USD 1.5 billion, of which USD 500 million were mobilized from other financial institutions.
About the IFC
The IFC, a member of the World Bank Group, is the largest global development institution devoted exclusively to the private sector. It works with private companies in 100 countries, using its capital, experience and influence to help eradicate extreme poverty and promote shared prosperity. In 2014 it provided more than USD 22 billion dollars in funding to improve the quality of life in developing countries and help them tackle their most pressing challenges.