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IFC and IFC ALAC Fund to invest US$100 million in Banco Fibra to expand credit to small- and medium-size enterprise


In Washington, D.C.:
Adriana Gomez
Phone: +202-458-5204
E-mail: AGomez@ifc.org

In Brazil
Banco Fibra
Eliana Nigro
Phones: 55 (11) 3031.2388 and (11) 9940.0119
E-mail: eliananigro@tamer.com.br


Washington, D.C. / São Paulo, July 19, 2011 – IFC, a member of the World Bank Group, completed today an equity investment in Banco Fibra S. A. in the amount of R$80 million (approximately US$50 million) to support credit expansion to small- and medium-size enterprises in Brazil. The IFC African, Latin American, and Caribbean (ALAC) Fund, managed by the IFC Asset Management Company, committed to invest an additional R$80 million to also become a Banco Fibra shareholder.

With their combined investment of R$160 million (approximately US$100 million) in Banco Fibra S.A., IFC and the IFC ALAC Fund confirm their confidence in the Bank’s business model. IFC has held 7.9% of the Bank’s capital since 2007 and, with the new IFC investment of R$80 million, it will own approximately 13% of the Bank´s shares.

“The IFC and IFC ALAC Fund investments will support the expansion of Fibra’s long-term funding, helping our growth strategy for corporate and retail credit,” said Antonio Francisco de Lima Neto, CEO of Banco Fibra. “We are delighted with our partnership with IFC, which began in 2007 and which has brought major benefits to our governance, and has greatly contributed with knowledge and expertise to our management,” noted Ricardo Steinbruch, Chairman of the Board of Directors of Banco Fibra.

“Our support to Banco Fibra is part of IFC’s strategy of providing long-term investments to well managed banks that promote access to finance for small and medium-size enterprises, an important engine for growth and job creation” said Paolo Martelli, IFC Director for Latin America and the Caribbean.  “In addition, IFC plays a key role in helping to enhance corporate governance practices, risk management and social and environmental standards in our client companies. ALAC’s participation in this project is also an important component of IFC’s objective to mobilize third-party funds to maximize the impact of our investments,” he said

With the new IFC investment and ALAC's entry as a new shareholder, the combined participation of minority shareholders will reach 20% of Fibra's capital. Grupo Vicunha will maintain its position as majority shareholder, with 80% of the shares. “These new capital increases will raise Banco Fibra’s net shareholders’ equity to a new level, greater than R$ 1 billion, with a pro-forma Basel index of 14.2% in May, enabling an increase of the credit portfolio of as much as R$ 3.4 billion,” concluded Lima Neto.

The capital investments are subject to the approval of the appropriate Brazilian authorities.

In Brazil, IFC’s strategy focuses on promoting access to finance and developing capital markets to reach low-income individuals, microenterprises, and small businesses.  IFC seeks to strengthen infrastructure and public services, including health and education, by increasing private sector participation.  Other key areas include improving the investment climate and helping small businesses join the formal economy. IFC also promotes socially and environmentally sustainable practices, specifically in the Amazon region.  

About Banco Fibra
Fibra, a multiple-services bank, was established in 1988. One of its main focus is on the credit segment for medium-size companies (those with sales mainly between R$ 40 million and R$ 400 million) and for individuals, in particular for the financing of consumer goods, payroll or pension deductible loans, and vehicle financing. It is controlled by Grupo Vicunha, a recognized financial group active in Brazil for over 40 years. Among other investments, Vicunha has corporate control of Vicunha Têxtil (textiles), CSN (steel) and Fibra Experts (real estate). For more information please visit: www.bancofibra.com.br.

About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit www.ifc.org.
 
About IFC Asset Management Company
IFC Asset Management Company LLC, a wholly-owned subsidiary of IFC, invests third-party capital, enabling outside investors to benefit from IFC’s expertise in achieving strong equity returns as well as positive development impact in the countries in which it invests. It manages the $3 billion IFC Capitalization Fund as well as the IFC ALAC Fund.

About the IFC African, Latin American, and Caribbean Fund
The IFC ALAC Fund is a $1 billion fund that invests alongside IFC in equity investments in Sub-Saharan Africa, Latin America and the Caribbean. It provides long-term growth capital for private enterprise in these regions.