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- OPEC Fund and Davivienda support MSMEs and job creation in Colombia
OPEC Fund and Davivienda support MSMEs and job creation in Colombia
Vienna, Austria, July 16, 2020. The OPEC Fund for International Development (the OPEC Fund) has signed a US$50 million term loan agreement in favor of Banco Davivienda in Colombia. This financing will enable the bank to strengthen its capital base under Basel III requirements (New Tier 2) and sustain the growth of its lending portfolio to women-owned, micro-, small- and medium-sized enterprises (MSMEs), social housing, and green building projects in Colombia.
This subordinated loan is the OPEC Fund’s first private sector transaction in Colombia and is part of a syndication arranged by the International Finance Corporation (IFC). By providing the loan, the OPEC Fund is helping to address the lack of financial access for underserved segments of the Colombian population.
Specifically, the project will support low-income households’ access to mortgages and improve female entrepreneurs’ access to funding. It will also drive a counter-cyclical action, since many people are facing additional challenges as a result of COVID-19. In addition, the project’s support for certified green buildings will benefit the Colombian people through an improved quality of life and job creation.
OPEC Fund Director-General Dr Abdulhamid Alkhalifa said: “The OPEC Fund is pleased to be providing funding to a systemically important bank in Colombia. Liquidity in the banking sector is more vital than ever, given the economic effects of COVID-19. Alleviating credit constraints for women and MSMEs will help to diversify the economy and support job creation. Supporting development must have equality and inclusiveness at its core.
“The OPEC Fund supports development projects aligned with the United Nations Agenda 2030 and Sustainable Development,” Dr Alkhalifa continued. “This loan supports inclusive development in Colombia, impacting Sustainable Development Goal (SDG) 8 on decent work and economic growth, SDG 5 on gender equality, and more generally, SDG 10 on reduced inequality.”
Efraín Forero, CEO of Banco Davivienda, stated: “This operation came at an excellent moment to support our clients and strengthen our sustainability strategy of supporting female entrepreneurship, financing sustainable projects and helping Colombian people fulfill their dreams of owning their home. Also, this credit allows us to strengthen our capital ratios in today’s challenging business environment.”
While this is the first OPEC Fund private sector project in Colombia, the organization has supported development in Colombia via public sector and grant finance for more than two decades.
About the OPEC Fund
The OPEC Fund is the development finance institution established by the Member States of OPEC in 1976 as a channel of aid to developing countries. The OPEC Fund works in cooperation with developing country partners and the international donor community to stimulate economic growth and alleviate poverty in all disadvantaged regions of the world. It does this by providing financing to build essential infrastructure, strengthen social services and promote productivity, competitiveness, and trade. The OPEC Fund’s work is people-centered, focusing on projects that meet basic needs – such as food, energy, infrastructure, employment (particularly relating to MSMEs), clean water and sanitation, healthcare, and education. The OPEC Fund aims to encourage self-reliance and inspire hope for the future.
At Davivienda we believe in a financial world that simplifies the lives of people, communities, businesses, and cities. As a result, currently we are a team of more than 17.2 thousand people in Colombia, Panama, Costa Rica, Honduras, El Salvador, and Miami, innovating, investing in knowledge, talent, and technology, collaborating, and seeking best practices worldwide. We do all of this to deliver day-to-day solutions and exclusive offers to 12.3 million customers, enabling greater financial inclusion and sustainable development. We are currently the second-largest bank by portfolio in Colombia*, with a network of 672 branches and more than 2,700 ATMs in Colombia and in our international subsidiaries. We are one of the companies belonging to the Bolívar Group. *Financial Superintendence of Colombia (figures as of March 2020).