Financiera de Desarrollo Nacional Climate Finance Facility (MIGA-14981)

  • Colombia
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Multilateral Investment Guarantee Agency (MIGA)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
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."
Banco Bilbao Vizcaya Argentaria, S.A.(BBVA)
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 260.00 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.
Project Cost (USD)
$ 273.00 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 @ MIGA website

Updated in EWS May 13, 2022

Disclosed by Bank Apr 1, 2022

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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.


This summary covers a proposed senior unsecured loan facility to be provided to Financiera de Desarrollo Nacional S.A (FDN) by Banco Bilbao Vizcaya Argentaria, S.A. (BBVA) and other potential commercial lenders yet to be identified (together with BBVA, the Lenders).

MIGA is considering issuing a guarantee covering a loan of up to US$ 273 million from the Lenders to FDN. MIGA's guarantee would be for up to an estimated US$ 260 million for a period of up to 11 years against the risk of Non-Honoring of Sovereign Financial Obligations by a State-Owned Enterprise (NHSOE).

MIGA's NHSOE instrument will be used to support FDN's local lending operations with a focus on climate finance infrastructure projects that will foster and support green 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.


FDN provides financing to infrastructure projects and corporate clients in Colombia. For this project, the MIGA guarantee will target FDN's climate finance projects in sectors such as renewable energy (predominantly, solar power projects), electric mobility (including, bus and railway systems) and water. 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 the 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 will be: (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 policywhich 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 clients' activities. Core elements of the process include screening against FDN's exclusion list, categorization, assessment of compliance with applicable E&S laws and regulations and screening against the Performance Standards. Where required, corrective action plans are developed to address E&S gaps and E&S covenants are also included in contractual agreements with clients. The E&S performance of projects is monitored periodically and site visits to high-risk projects are typically conducted once a year. The E&S team is responsible for the overall implementation of the ESMS throughout FDN's portfolio and external communication. Additional support is provided by external consultants during due diligence and monitoring. To strengthen the E&S risk management process, FDN will be required to revise its internal E&S questionnaire to include all elements of the MIGA Performance Standards.

FDN's emergency response procedures are in line with the requirements of PS1. In response to the COVID-19 pandemic, FDN has developed a COVID protocol and implemented physical distancing and hygiene measures to minimize and manage the risk of exposure for its employees and clients.

FDN's labor policies and procedures are compliant with the requirements of PS2. Amongst other aspects, FDN has labor policies and procedures that address terms of employment, recruitment, renumeration, and benefits, grievance management, training, and occupational health and safety.

FDN will be required to report periodically to MIGA on the implementation of the ESMS and application of the Performance Standards.


The Project is expected to bring climate benefits into Colombia as the proceeds of the MIGA-guaranteed loan will be used to support climate finance projects in the infrastructure sector. The Project also has potential demonstration effects relating to the viability of green investment in Colombia, and potential signaling effects by supporting investors' sentiment and perceptions that Colombia remains an investible country. Furthermore, building on previous engagement with FDN, MIGA's credit enhancement coverage is expected to support the diversification of FDN's funding sources and optimization of funding costs while contributing to the country's climate goals.

The proposed Project is consistent with the most recent World Bank Group (WBG) Country Partnership Framework (CPF) FY2016-2021 for Colombia, which was updated through the Performance and Learning Review (PLR) of April 2019. The adjustments to the CPF envisage a deepening of WBG engagement in climate change, Maximizing Finance for Development (MFD), and gender. As such, climate change features in all three pillars of the updated CPF. In addition, the new Colombia Systematic Country Diagnostic (SCD) clearly identifies that for the country to meet its commitments for greenhouse gas emissions, the country needs, among other actions, to accelerate the transition to decarbonize the energy sector, to which the Project is aligned.

The Project is aligned with MIGA's FY21-23 Strategic Business Outlook under its strategic directions of responding to the COVID-19 crisis by supporting a green recovery in Colombia. Furthermore, the Project is contributing to MIGA's strategic direction of demonstrating leadership on global issues such as climate change, as well as with the strategic direction of continuing to serve all client countries and complement market creation.


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

In addition to Banco Bilbao Viscaya, this guarantee will be extend to other financial institutions yet to be identified and that are willing to lend funds to Financiera de Desarrollo Nacional S.A (FDN).

Private Actor 1 Private Actor 1 Role Private Actor 1 Sector Relation Private Actor 2 Private Actor 2 Role Private Actor 2 Sector
- - - - Banco Bilbao Vizcaya Argentaria, S.A. Client Finance

Contact Information
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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 You can learn more about the CAO and how to file a complaint at

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