Banco Azul de El Salvador, S.A.
Status: Investment in contracting phaseWhy disclosure?
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In case of questions, please contact us at disclosure@fmo.nl
Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our prospective customer?
Banco Azul de El Salvador, S.A. (“Banco Azul”, "the Bank") is a medium-sized commercial bank in El Salvador. The Bank has total assets of USD 867.2 million and a loan portfolio of USD 610.4 million as of December 2023.
What is our funding objective?
The USD 20 million senior term facility is part of a USD 40 million syndicated transaction and it consists of a small and medium-sized enterprise (SME) tranche (at least 33%), a Green tranche (at least 33% of the facility) and a women-owned SME tranche (at least 33%). The SME tranche will be used to support Banco Azul to grow its SME portfolio, the Green tranche will be on-lend to green projects in line with green lending criteria, aimed at renewable energy and energy efficiency in El Salvador. The female SME tranche is dedicated to financing women-owned SME clients.
Why do we want to fund this investment?
Banco Azul plays an important role in providing access to finance to SMEs, a critical segment in supporting job creation. Through this facility, FMO realizes its strategic goals to finance SMEs. Additionally, by providing financing to small and medium enterprises, green projects and women-owned SMEs in El Salvador, the loan will contribute to FMO’s strategic goal to create jobs, reduce gender inequalities and reduce GHG emissions. Due to the financing to women-owned SMEs in El Salvador, this transaction qualifies for a 33% Reducing Inequalities label.
What is the Environmental and Social categorization rationale?
Banco Azul is classified as an E&S risk category FI-B in accordance with FMO’s Policy. The Bank has limited exposure to E&S high risk sectors and an SME focus. Banco Azul’s Environmental and Social (E&S) risks are managed through an existing Environmental and Social Management System (ESMS), operated by a dedicated E&S team. As part of the transaction, Banco Azul is required to apply the EDFI Exclusion List, El Salvador’s E&S laws and regulations, and the IFC Performance Standards for applicable transactions.
- Website customer/investment
- https://www.bancoazul.com/
- Region
- Latin America & The Caribbean
- Country
- El Salvador
- Sector
- Financial Institutions
- Publication date
- 8/22/2024
- Deadline for feedback
- 9/21/2024
- Total FMO financing
- USD 20.00 MLN
- Funding
- FMO NV
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Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - B