📋 Tender Overview
PROJECT ID14981GUARANTEE HOLDER
Banco Bilbao Vizcaya Argentaria, SA(BBVA)
INVESTOR COUNTRY
Spain
ENVIRONMENTAL CATEGORYFIDATE SPG DISCLOSEDApril 01, 2022BOARD APPROVAL DATEJune 24, 2022PROJECT TYPENon-SIPFISCAL YEAR2022
On June 30, 2022, MIGA issued a guarantee covering a loan of up to COP 1,000 billion from Banco Bilbao Vizcaya Argentaria, SA (BBVA) to National Development Finance SA (FDN). MIGA's guarantee is for an estimated amount of up to COP 1,707 billion for a period of 10 years against the risk of Non-Honoring of Financial Obligations by a State-Owned Enterprise (NHSOE).
MIGA’s NHSOE instrument supports FDN’s local lending operations with a focus on climate finance infrastructure and road projects that will foster and support economic recovery in Colombia after the effects caused by the COVID-19 pandemic, and lay out the basis for the stabilization, protection, and reactivation of the Colombian business base.
Environmental Categorization:
FDN provides financing to infrastructure projects and corporate clients in Colombia. For this project, the MIGA guarantee targets FDN’s climate finance projects in sectors such as renewable energy (predominantly, solar power projects), electric mobility (including, bus and railway systems) and water, as well as road projects. Some of these projects could have significant environmental and social (E&S) risks and impacts, and as such, the portfolio is considered high risk. This project has thus been categorized as FI-1 under MIGA’s Policy on Environmental and Social Sustainability (2013).
The main E&S risks of this project relate to FDN’s ability to identify, assess, and manage the E&S risks and impacts associated with its lending activities and the management of labor matters. MIGA analyzed FDN’s portfolio for types of transactions, tenor, size, industry sectors, and exposure to MIGA’s Exclusion List. MIGA also analyzed FDN’s E&S risk management procedures in line with the requirements of Performance Standard 1: Assessment and Management of Environmental and Social Risks and Impacts (PS1), and FDN’s labor practices in line with the requirements of Performance Standard 2: Labor and Working Conditions (PS2). The applicable E&S requirements for this project are: (i) MIGA Exclusion List; (ii) applicable E&S laws and regulations in Colombia; and (iii) MIGA E&S Performance Standards.
As of December 2021, loans to project finance represented 85.5% of FDN’s portfolio, with corporate finance loans and capital market transactions representing 9.0% and 5.5% respectively. The main sectors being financed include infrastructure (mainly road projects), financial intermediaries, and transport services. FDN has no exposures to activities on the MIGA Exclusion List.
FDN has an E&S policy which stipulates the E&S management system (ESMS) and the responsibilities of the E&S team. The ESMS includes a detailed procedure for identifying, assessing, and managing E&S risks and impacts associated with cli
