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IFC Funds its First Energy Efficiency Financing Program in the Caribbean


In Washington, D.C.:
Adriana Gómez
, IFC
Tel: +1(202) 458 5204

E-mail:
Agomez@ifc.org

In the Dominican Republic:
Josefina Navarro, Banco BHD

Tel:  (809) 243-5219

E-mail:
josefina_navarro@bhd.com.do


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 IFC client.


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 business opportunities.


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.


About IFC

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.