Washington D.C, October 1, 2002—The
International Finance Corporation (IFC), the private sector developing
arm of the World Bank Group, has signed an agreement to provide US$40 million
to Union de Bancos Cuscatlan, one of the most important financial groups
in Central America.
The IFC financing will help strengthen the Cuscatlan group’s capital base
and will support the expansion and consolidation of its operations in Central
America. The operation includes an equity investment in Cuscatlan’s
holding company and subordinated convertible loans to the group’s subsidiaries
in El Salvador, Guatemala and Costa Rica.
The agreement was signed today in Washington D.C. by IFC Chief Peter Woicke
Mauricio Samayoa, President of Union de Bancos Cuscatlan.
Mr. Woicke, also Managing Director of the World Bank Group, said: “A vibrant
and healthy private sector is a key element of economic growth and sustainable
job-creation. Strengthening the financial sector in Central America
is a key IFC priority. Our collaboration with Cuscatlan shows a clear
commitment to pursue this objective and will establish a foundation for
other financial markets development work in the region.”
Mr. Samayoa noted: “IFC’s investment is a vote of confidence in Cuscatlan
and in the future of the Central American financial markets. “He
added: “IFC’s financial strength and experience will be invaluable as
Central America strives to develop its financial infrastructure.”
Cuscatlan is headquartered in Panama, and is a well-diversified financial
group with operations that span across the Central American region through
subsidiaries in El Salvador, Guatemala and Costa Rica. The Group
has 3, 277 employees, 144 branches and 365 ATMs.
IFC’s strategy in Central America focuses on encouraging economic growth,
in particular via the development of regional financial and physical infrastructure,
and supporting competitive manufacturing and services companies. IFC’s
investment in Cuscatlán is consistent with this strategy as it would help
promote regional financial integration and increase the depth and soundness
of financial systems in the region.
IFC’s mission (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people’s lives. IFC finances
private sector investments in the developing world, mobilizes capital in
the international financial markets, and provides technical assistance
and advice to governments and businesses. Since its founding in 1956,
IFC has committed more than $34 billion of its own funds and arranged $21
billion in syndications for 2,825 companies in 140 developing countries.
IFC’s committed portfolio at the end of FY02 was $15.1 billion.