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IFC Loan to Banco Galicia Will Help Smaller Businesses in Argentina’s Poorer Provinces


In Sao Paolo:
Karina Manasseh

Phone: +55 (11) 5185-6881

Email:
Kmanasseh@ifc.org


Washington, D.C., November 29, 2007— IFC, a member of the World Bank Group, today signed an agreement with Banco de Galicia y Buenos Aires S.A. to support the bank’s onlending to small and medium enterprises in Argentina, with a particular focus on those located in poorer provinces.

This $50 million, eight-year loan marks IFC’s second direct financing to Banco Galicia since the Argentine financial crisis, and the first ever IFC project in the country to offer Argentine peso-linked financing.


Atul Mehta, IFC’s Director for Latin America and the Caribbean, said, “Banco Galicia is a key partner for IFC in addressing the financing needs of the medium and small-sized enterprises of Argentina’s private sector.  IFC is pleased to be able to offer its first Peso-linked loan in Argentina to Banco Galicia.”


Banco Galicia is the largest private sector commercial bank in Argentina in terms of assets (US$6.8 billion as of September 30, 2007) and fourth in terms of shareholders’ equity (US$542.3 million as of September 30, 2007). Since 2004, the bank has steadily increased its private sector lending activities while also increasing its deposit market share.  In March, the bank became the first bank in Latin America outside Brazil to adopt the Equator Principles.


Sergio Grinenco, Vice Chairman of Banco Galicia’s Board of Directors, said, “as one of the leading private-sector financial institutions in Argentina, we are pleased to consolidate our strategic relationship with IFC through this transaction, which enables us to increase our financial support to export-oriented investment projects of small and medium sized enterprises, thus confirming our traditional commitment to this dynamic and large sector of the Argentine economy and our longstanding leadership position in the provision of financial services to such sector.”


Yolande Duhem, IFC’s Senior Country Manager for Argentina and the Southern Cone, added, “IFC is pleased to continue supporting Argentine SMEs across the country and especially in less privileged provinces, through its partnership with Banco Galicia This transaction allows Banco Galicia to offer long-term funding in both dollars and local currency, an option that is not yet broadly available to Argentine enterprises.”

 
About IFC

IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries. IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products has committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, to accelerate private participation in infrastructure, to improve the business enabling environment, to increase access to finance, and to strengthen environmental and social sustainability. For more information, please visit
www.ifc.org.

About Banco Galicia

Founded in 1905, Banco Galicia is one of the largest private-sector banks in the Argentine financial system and a leading financial services provider in the country. As a universal bank, through affiliated companies and a variety of distribution channels, Banco Galicia offers a full spectrum of financial services to over 4.0 million customers, both individual and corporate. Banco Galicia operates one of the most extensive and diversified distribution networks among private sector banks in Argentina, offering more than 380 points of contact with customers through its branches and electronic banking facilities. The Bank’s customers also have access to telephone banking services and e-galicia.com, the first financial Internet portal and the first mobile payment service, respectively, established by a Bank in Argentina. The Bank's main shareholder is Grupo Financiero Galicia S.A., a financial services holding company.