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IDB Invest, Banco W issue bond to support women entrepreneurs in Colombia

It is the first gender social bond in the region issued by a bank dedicated to microfinance
posted onNovember 11, 2020
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IDB Invest, a member of the Inter-American Development Bank (IDB) Group, structured and subscribed a social bond with a gender focus issued by Banco W S.A. and registered in the Colombian Stock Exchange on Nov. 6. The 4-year tenor bond of COP$150 billion, equivalent to $39.6 million, is the first gender social bond in the region issued by a bank dedicated to microfinance.

The resources from the bond placement will be used to finance the growth of Banco W’s portfolio of micro-enterprises led by women. It is expected that these resources will have a positive impact on the development of this segment, by increasing access to credit and strengthening their businesses. The bond aims to benefit approximately 25,000 women microentrepreneurs throughout the country.

The financing will also contribute to the development of the capital markets and thematic bonds in Colombia and the region, consolidating Banco W as a recurring issuer that generates high social impact and contributes to the sustainable development of the country.

As part of the bond issuance process, IDB Invest advised Banco W in the design of the methodological framework for the use of funds, which contains the criteria for selection, monitoring and evaluation of projects, aligned with the principles of social bonds of the International Capital Markets Association (ICMA).

Additionally, IDB Invest supported Banco W in obtaining an independent verification of the methodological framework, known as a second-party opinion, issued by Vigeo Eiris, an external consultancy specialized in this type of project.

IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector.

With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. 

Banco W is a Colombian microfinance bank, member of the international Women’s World Banking (WWB) network. It is present in 30 of the 32 departments of Colombia through a network of 146 agencies. 

Focused on the medium-low niche of local microcredit, Banco W offers loans through an individual methodology and complements its offer with consumer loans, microinsurance and fund-raising.

As of June 2020, it managed a net portfolio of $338 million and 217,994 clients. In July 2020, BRC Investor (Standard & Poor's in Colombia) ratified the local long-term debt rating of Banco W at AA and the short-term debt at BRC1 +. This rating ratifies the broad knowledge and experience of Banco W in the microcredit segment.