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Davivienda Issues COP$433 Billion in Green Bonds in Support of Projects Mitigating Climate Change, With IFC as Sole Investor


Darcy Antonin Crowe
Communications Officer
Tel: +57 1 313 6449
E-mail: dcrowe@ifc.org

Bogota, Colombia, April 25, 2017—Davivienda, one of the country’s largest banks, has concluded a record green bond issue in Colombia as part of its efforts to offer financing to customers seeking to develop sustainable projects that help to mitigate climate change.

The International Finance Corporation (IFC), a member of the World Bank Group, which is considered to be one of the main promoters of green investments globally, is the sole investor of the COP$433 billion bond issuance (approximately US$150 million) at a tenor of 10 years and a rate of IBR+2.13 percent.

Green bonds are an investment tool to leverage financing for projects that help mitigate climate change, such as renewable energy, sustainable construction, cleaner production, and energy efficiency.

This is the largest green bond issue by a private financial institution in Latin America, demonstrating Davivienda’s commitment to financing projects with a positive climate and environmental impact. The issuance responds to Colombia’s target of reducing its pollutant emissions 20 percent by 2030. The funds will be used to finance projects in the areas of sustainable construction, cleaner production, energy efficiency and renewable energies (water, biomass, wind and photovoltaic solar energy).

Projects aimed at mitigating the risk of flooding and promoting water management, reduction of CO2 emissions and thermal energy generation for the production of cleaner energy are a few examples of projects that may potentially access these resources.

“The green bonds issuance is part of our Sustainability Strategy, which focuses on the development of responsible and inclusive criteria in our business operations, including the mitigation of environment impacts, adaptation to climate change, and strengthening of our community programs and initiatives,” explains Efraín Forero, President of Davivienda.  

IFC and Banco Davivienda have a long standing relationship, dating back to 1973 when IFC made its first investment in Grupo Bolívar, Davivienda’s parent company and one of the main financial groups in Colombia. Since that time, IFC has provided lines of credit and capital investments to the bank. In 2007, IFC provided financing to support Banco Davivienda’s purchase of Granbanco (formerly Bancafé) in Colombia.

Irene Arias, IFC Director for Latin America and the Caribbean, notes that the bond issue is another example of Davivienda’s leadership in promoting Colombia’s sustainable development. “With this issue, Davivienda is taking another step in support of the development of the green bond market in Colombia and Latin America. Davivienda is committed to combating the factors that cause climate change and, by purchasing this issue, IFC is demonstrating the importance of green bonds in the financing of sustainable projects.”

“As part of IFC’s strategy in Colombia, it is essential to promote the development of the capital market as an important source of financing that reduces dependence on foreign debt and strengthens the capacity to adapt to economic shocks. The green bond, which is a relatively new instrument on the local market, is an important step in the development of the capital market,” says Marcelo Castellanos, IFC Manager for the Financial Institutions Group in Latin America.

IFC has identified more than US$1 trillion in climate financing opportunities in Latin America and the Caribbean through to 2040. In Colombia, the potential alone for financing of renewable energies, for example, totals US$27.5 billion. IFC will continue to support the development of financial instruments such as green bonds to ensure that the capital markets continue to perform their function of promoting climate financing. At the global level, IFC has issued US$5.6 billion in green bonds in various currencies.

About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, IFC uses its six decades of experience to create opportunity where it is needed most. In FY16, our long-term investments in developing countries rose to nearly $19 billion, leveraging our capital, expertise, and influence to help the private sector end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.
 
About Davivienda
Davivienda is a Colombian bank belonging to the Grupo Bolívar. Since 1972 it has provided services to individuals, businesses, and the rural sector. Its comprehensive portfolio of products and services meets its customers’ needs with constant innovation and exclusive offers for each customer segment. It has a team of over 17,300 employees to serve more than 8.8 million customers through 753 offices, over 3,100 Daviplata service locations and some 2,200 ATMs throughout the region. In addition to its operations in Colombia, it is active in Panama, Costa Rica, Honduras, El Salvador, and Miami, United States.

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