The Inter-American Development Bank today closed the first transaction in Honduras under its Trade Finance Facilitation Program (TFFP) with Banco Financiera Comercial Hondureña, S.A. (Banco Ficohsa). Under this transaction, the IDB has extended its guarantee to cover a promissory note used to finance the import of fertilizer from Switzerland to Honduras by a local fertilizer distribution company. The IDB issued this guarantee in favor of Citibank, thus sharing the risk assumed on the transaction with Banco Ficohsa.
“By joining the TFFP, we are able to expand and diversify our funding base by gaining access to the 97 major correspondent banks in 31 countries around the world within the TFFP network, to the benefit of our customers and the Honduran external sector", said Abel Garcia, Vice President of Financial and International Services.
The approximately US$4 million, 110 days tenor deal will benefit the Honduran agriculture sector.
TFFPLaunched and rolled-out in 2005, the TFFP is an effective tool for the IADB to support economic growth through the expansion of financing available for international trade activities of Latin American and Caribbean countries. The TFFP currently comprises a network of 97 Confirming Banks belonging to 31 different international banking groups in over 31 countries, and 26 Issuing Banks in 13 LAC countries with over US$480 million in approved credit lines. To date, the IADB has issued guarantees for over US$134 million in support of 175 individual international trade transactions totaling US$184 million.
BANCO FICOHSA
Banco Ficohsa is a Honduran bank with over US$ 1 billion in assets. It is headquartered in Tegucigalpa with a widespread branch network throughout the country. The bank is very active both in the corporate and the consumer segment. The TFFP is expected to play a meaningful role in assisting Banco Ficohsa to broaden its international funding base among existing and new international correspondent banks.