Santo Domingo, Dominican Republic, May
18, 2010 – IFC, a member of the World Bank Group, today signed a $20
million financing to launch Banco BHD’s innovative new energy efficiency
finance program, which will help Dominican firms decrease their energy
costs and consumption, implement cleaner production projects and reduce
greenhouse gas emissions.
Lars Thunell, CEO and Executive Vice President of IFC, was in Santo Domingo
to sign the agreement with Luis Molina Achecar, President of Banco
BHD, the second largest private bank in the Dominican Republic and a longtime
This is IFC’s third financing to BHD. In 2003, IFC committed $20 million
to Banco BHD and in 2008 IFC purchased a stake of shares in Centro Financiero
BHD, Banco BHD’s holding, becoming Centro’s fourth largest shareholder,
currently holding a stake of 8.5%.
During the signing, the Banco BHD president, Luis Molina Achecar noted:
“ We welcome IFC’s new financing and long-term partnership in providing
its global expertise in developing clean technology and energy efficiency
products for our clients in the Dominican Republic, the first of its kind
in the Caribbean.”
With IFC’s support, BHD will finance energy efficiency projects in the
industrial and tourism sectors in the Dominican Republic, where electricity
costs are among the highest in the region. This will help generate savings,
increase companies’ competitiveness and grow awareness for climate change-related
In addition to financing, IFC will also provide advisory services to help
Banco BHD create a new energy efficiency unit that will develop a project
pipeline, conduct energy audits for clients and identify new energy efficiency
investments. By setting an example in the Dominican market, this energy
efficiency finance program could serve as the basis for similar approaches
in the Caribbean region.
"Today we inaugurate IFC’s first energy efficiency finance program
in the Caribbean, which underscores the innovative leadership of BHD in
the region’s financial sector,” Thunell said. “Our partnership with
BHD will bring Dominican firms economic and environmental benefits. Not
only is this smart business, but it also underlines the role the private
sector can play in improving competitiveness and mitigating global climate
change at the same time."
Though the energy sector is one of the Dominican Republic’s key bottlenecks
to economic growth, there are also significant opportunities for climate-friendly
investments. A diagnostic study conducted by IFC found that switching to
natural gas could bring firms savings of 30 to 50 percent while allowing
them to recoup the cost of investment within six months to two years. However,
the lack of commercial financing has made natural gas conversion unaffordable
for many companies and constrained other investments in energy efficiency.
IFC’s approach in the Dominican Republic focuses on improving the business
climate, strengthening infrastructure, increasing access to finance and
promoting sustainability. Supporting BHD’s energy efficiency finance program
fits into IFC's strategy of providing the financial sector with innovative
solutions that increase their clients’ competitiveness.
Since 1997, IFC has supported 50 energy efficiency finance projects in
23 countries worldwide, for a total amount of $974.6 million.
IFC, a member of the World Bank Group, creates opportunity for people to
escape poverty and improve their lives. We foster sustainable economic
growth in developing countries by supporting private sector development,
mobilizing private capital, and providing advisory and risk mitigation
services to businesses and governments. Our new investments totaled $14.5
billion in fiscal 2009, helping channel capital into developing countries
during the financial crisis. For more information, visit www.ifc.org.
About Banco BHD
Banco BHD is the second largest commercial bank in the Dominican Republic,
with 88 branches across the country.