Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO), a Dutch development bank, recently announced that it has closed a USD 100 million syndicated A/B loan for Banco Continental SAECA, a commercial bank operating in Paraguay. The A tranche comprises USD 47 million for a period of 5 years, and the B tranche of USD 53 million has a term of three years. The loan allows Banco Continental to “diversify its sources of medium-term financing in a volatile environment and aid in the growth of its loan portfolio.”
The A tranche is funded by FMO, the Netherlands’ Triodos Investment Management and the Belgian Investment Company for Developing Countries (BIO). While the amounts invested by the others has not been disclosed, FMO is lending Banco Continental USD 17 million. This tranche is to be used for on-lending to small and medium-sized enterprises (SMEs).
The B tranche was arranged by Banco Latinoamericano de Comercio Exterior (Bladex), which is based in Panama, with co-funding in undisclosed amounts from seven other institutions [2].
Banco Continental has also participated in FMO’s sustainable finance initiative to incorporate environmental and social risk into its credit risk calculations [1].
About FMO:
Nederlandse Financierings-Maatschappij voor Ontwikkelingslanden (FMO) is a development bank that was founded in 1970 by the Dutch government, which owns 51 percent of the institution. Its other stakeholders are commercial banks, trade unions, employers’ associations and individual investors. FMO supports governments and invests in financial institutions, energy firms and agribusiness operators in developing countries through loans, guarantees and other investment promotion activities, including local-currency investments. As of 2015, FMO reported total assets of EUR 8.4 billion (USD 9.05 billion), total loans of EUR 4.2 billion (USD 4.6 billion).
By Sharanya Madhavan, Research Associate
Sources and Additional Resources
[1] FMO press release: FMO Closes a USD 100 Million Syndicated Loan with Banco Continental
[2] Bladex press release: Bladex co-leads successful syndication of a US$100 million 3 and 5-year A/B Term Loan
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