DCM Fondo Esperanza Social Bond (IFC-42684)

Countries
  • Chile
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Completed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jan 10, 2020
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
FONDO ESPERANZA SPA
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 10.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 10.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS May 17, 2024

Disclosed by Bank Dec 4, 2019

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

The proposed investment (the “Project”) consists of an IFC anchor investment of up to US$10 million equivalent in local currency in an up to US$20 million total issuance for Fondo Esperanza SpA. (the “Company” or “FE”), as part of the Company’s first commercial paper program (the “Program”) in the local capital market in Chile (the “Country”). IFC would subscribe a longer dated 2-year tranche to mobilize the remaining US$10 million from other local investors expected to invest in a shorter renewable tranche. The Project will help expand the Company’s microfinance portfolio to low-income microentrepreneurs, currently underserved by the traditional banking sector.

People Affected By This Project
People Affected By This Project refers to the communities of people likely to be affected positively or negatively by a project.

The most significant expected project outcome is increased access to finance for microentrepreneurs from underserved segments in Chile. In addition, IFC anticipates that the Project has the potential to promote greater inclusiveness via demonstration and replication channels.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

According to the IFC, IFC’s proposed investment consists of a subscription of unsecured securities in the form of social commercial papers for up to US$10 million equivalent in local currency.

Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

According to the IFC, Fondo Esperanza is a non-banking financial institution with more than 16 years of experience focusing on social development by supporting entrepreneurs from vulnerable sectors. It offers an integral microfinance service consisting of productive microcredits, microinsurance, mandatory trainings and strengthening of support networks. The Company is owned by Fundación de Microfinanzas BBVA with 51% of the capital and Hogar de Cristo with the remaining 49%.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Fondo Esperanza SpA.
Marion Pavón Prat
Gerente General
+56 2 3245 3810
mpavon@fondoesperanza.cl
San Antonio 427 – 2nd floor, Santiago, Chile
https://www.fondoesperanza.cl

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/

How it works

How it works