Banco Itaú BBA SA will get a loan of up to $100 million from the Inter-American Development Bank (IDB) to finance environmentally friendly projects in Brazil, Chile, Colombia, Paraguay, Peru and Uruguay.
Proceeds from the IDB A loan will be used to finance projects related to renewable energy, energy efficiency, cleaner production in manufacturing and processing as well as projects that can generate carbon credits. The IDB loan may be complemented by a syndicated B-loan of up to $100 million.
“There is a shortage of financing for green projects in Latin America and this is part of our efforts to bridge this gap,’’ said Daniela Carrera-Marquis, Chief of the IDB Financial Markets Division at the Structured and Corporate Finance Department (SCF). In recent years, SCF has approved $325 million in loans to financial institutions in Latin America and the Caribbean to finance climate-friendly projects.
"We are pleased to partner with the IDB for this unique transaction,'' said Carolina Camargo, Head of International Financial Institutions at Banco Itaú BBA, Brazil. "Leveraging the IDB’s local market expertise and reputation in Latin America coupled with our group origination and execution capabilities provide the perfect vehicle to finance environmentally-friendly projects and have a demonstration effect.”
The IDB loan will be combined with technical assistance. Itaú BBA may implement an e-learning platform developed by the IDB’s beyondBanking program, which will allow participants to improve the origination process of environmentally friendly loans, and adopt various screening procedures to select projects that qualify for financing. Itaú BBA will also adhere to the IDB’s eligibility criteria for the selection of green projects and follow Bank guidelines for sustainability reports.
“This project can show that banking in the region can go beyond traditional risk assessment models and include processes that allow investors to maximize their impact,’’ said Karina Azzinnari, the IDB project team leader.
About the IDB's Structured and Corporate Finance Department
The Structured and Corporate Finance Department (SCF) leads all IDB's non-sovereign guaranteed operations for large-scale projects, as well as those linked to companies and financial institutions. Through its Loan Syndication Program, SCF acts as a catalyst, helping to engage third-party resources by partnering with commercial banks, institutional investors, co-guarantors and other co-lenders for projects with high developmental impact.