Washington, D.C./ Medellín, Colombia,
June 30, 2010—IFC, a member of the World Bank Group, signed a risk-management
facility with Bancolombia to execute up to $400 million of risk-management
transactions. This IFC facility, the first of its kind to a
Colombian bank, will strengthen the bank’s ability to provide risk-management
instruments to local companies.
Through the facility, IFC will increase
the capacity of Colombian companies to access risk-hedging products such
as cross currency and interest rate swaps. This will allow these
companies to better manage their exposure to foreign exchange and interest
rate risk, which could result in lower-income volatility and a more stable
cash flow. Risk-mitigation instruments are important in helping local
companies forecast costs and revenues, allowing them to reduce risk and
focus on their core productive activities.
“We welcome IFC’s support to Bancolombia
to address the increasing demand for risk-mitigation instruments among
small and medium enterprises in Colombia, the backbone of our economy,”
said Jorge Londoño Saldarriaga, Bancolombia CEO. “With IFC’s partnership,
Bancolombia will strengthen its position as a market leader and will help
fill an important market gap.”
By having IFC as a counterparty on cross
currency and interest rate swaps, Bancolombia will be able to cope with
the demand of risk-management instruments in particular in the real sector
of Colombia, including manufacturing, construction, and tourism.
“With this facility to Bancolombia,
IFC is helping address the Colombian market’s needs and is showing its
commitment to supporting the local private sector through a diverse range
of financial structures and products,” said Enrique Cañas, IFC Manager
for Bolivia, Colombia, Peru, and Venezuela. “IFC is partnering with a
sector leader in this project to continue supporting the sustainable development
IFC’s strategy in Colombia focuses
on supporting sectors that are essential to social and economic development,
including infrastructure, health, education, and public-private partnerships
to build ports, roads, and airports. IFC assists leading Colombian
companies modernize and expand their businesses internationally. IFC
also promotes access to finance for micro, small, and medium enterprises
and works on improving the investment climate by simplifying regulations
and royalty management.
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 capital for private enterprise, and providing advisory and risk
mitigation services to businesses and governments. Our new investments
totaled $15 billion in fiscal 2009, helping channel capital into developing
countries during the financial crisis. For more information, visit www.ifc.org.
With over 130 years of experience, Bancolombia
is the largest bank in Colombia, offering a wide range of banking products
and services to a diversified individual and corporate customer base of
more than 6.9 million customers. Bancolombia and its subsidiaries provide
stock brokerage, investment banking, leasing, factoring, consumer finance,
fiduciary and trust services, asset management, pension fund administration,
and insurance, among others. The bank’s shares are listed in the New York
Stock Exchange since 1995, in addition to the Colombian Stock Exchange.
For more information, visit www.bancolombia.com.co.