Washington, D.C., September 16, 2010 — IFC,
a member of the World Bank Group, issued a 50 million Brazilian real guarantee
for investors in a fund that securitizes loans originated by Banco Industrial
Comercial S.A. to small and midsize businesses in Brazil. The transaction
is IFC’s first in a Brazilian securitized fund, or FIDC (Fundos do Investimento
em Direitos Creditorios), that targets loans to small and midsize enterprises.
These firms provide more than two-thirds of the 35 million jobs in Brazil’s
The transaction will increase lending to small
and medium businesses, primarily outside the large urban centers, by providing
long-term, local currency funding. BicBanco, in turn, can channel the funding
to local small and medium firms. BicBanco, an IFC client since 2006, is
a leader in providing credit to small and midsize businesses.
Securitizing BicBanco’s loans to small
and medium enterprises will allow it to diversify its funding sources and
tap into long- term funding from the domestic securitization market. This
is an innovative way to complement efforts undertaken by the Brazilian
government and many mid-sized banks over the last year to mitigate effects
of the global financial crisis and stabilize the funding base of financial
“This transaction will help BicBanco access
a new type of institutional investor to support the loan portfolio expansion
for our Brazilian small and medium enterprises,” said Milto Bardini, BicBanco’s
Executive Vice President. “We confirm once again that IFC is a long-term
partner to BicBanco. Together, we were able to provide an instrument to
the local capital market that is rarely offered and meets institutional
This fund issued 192.5 million Brazilian real
of senior quotas and 57.5 million Brazilian real in subordinated quotas
for a total of 250 million Brazilian real. The senior quotas were sold
to qualified local investors, who have the right to sell up to 25 percent,
or as much as 50 million Brazilian real, of their senior quotas to IFC
under certain circumstances. BicBanco subscribed to the subordinated quotas.
FIDCs are the most commonly used funds that issue asset-backed securities
“The successful placement of the BicBanco
FIDC demonstrates IFC’s capacity to mobilize local market resources for
financial institutions that play a key role in economic development and
job creation in Brazil,” said Paulo de Bolle, IFC Acting Country Manager
in Brazil. “This capacity is particularly important in allowing mid-sized
banks to diversify their funding sources."
IFC’s strategy in Brazil focuses on promoting
access to finance and developing capital markets to reach low-income individuals,
microenterprises, and small businesses. As of June 2010, IFC’s committed
portfolio in Brazil was $2.4 billion.
IFC, a member of the World Bank Group, is the largest global development
institution focused on the private sector in developing countries. We create
opportunity for people to escape poverty and improve their lives. We do
so by providing financing to help businesses employ more people and supply
essential services, by mobilizing capital from others, and by delivering
advisory services to ensure sustainable development. In a time of global
economic uncertainty, our new investments climbed to a record $18 billion
in fiscal 2010. For more information, visit www.ifc.org.
One of Brazil’s oldest private banks, BicBanco is a leading provider of
funding to small and medium enterprises in Brazil. It is the fifth-largest
national private bank in terms of loans extended to midsized companies.
The bank’s main product lines are working capital, secured loans, trade
finance, and public employee loans. BicBanco is rated brA (stable) by the
S&P on Brazil’s domestic rating scale. For more information, visit