Guatemala-based Banco Industrial closed a $415 million debt package with backing from the International Finance Corp., along with FinDev Canada and the Japan International Cooperation Agency, the Canadian and Japanese development finance institutions. The financial institution will use the capital to grow its sustainable lending portfolio, focusing on green buildings and climate-smart agriculture.
The bank, one of the oldest financial institutions in Guatemala, says its green lending push is aligned with the national government’s commitment to cut its 2030 greenhouse gas emissions by up to 23% from a 2005 baseline.
Banco Industrial will also build up its small business loan book, with a focus on female borrowers.
Financing firsts
The deal marks FinDev Canada’s first in Guatemala. FinDev Canada was launched in 2018. About 30% of the DFI’s portfolio is based in Latin America. Its goal is agility, especially around climate-related investments.
“We are very much committed to the sustainability agenda,” FinDev’s Paulo Martelli told ImpactAlpha. “We’ve done same-day disbursements – unheard of in the DFI space – and built processes that let us be quick and client-focused.”
Japan International Cooperation Agency, or JICA, is also becoming more active in the region. In February, JICA created and funded a billion-dollar fund, in partnership with IDB Invest, to spur private sector investment in Latin America and the Caribbean.
The IFC, JICA and FinDev also inked a $150 million investment in Honduras’s Banco del País to boost financing for small businesses, female entrepreneurs and green projects in energy, water and sanitation.
