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Overview

[China Co-Financing Fund] IDB administers 25 million USD loan from CHC to National Bank of Costa Rica for MSME Financing Partnership

Commitments (Constant USD, 2023)$25,638,830
Commitment Year•2014Country of Activity•Costa RicaDirect Recipient Country of Incorporation•Costa RicaSector•Banking And Financial ServicesFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
May 7, 2014
First repayment (originally scheduled)
May 6, 2019
Last repayment (originally scheduled)
May 4, 2024

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

Government Agencies

  • People's Bank of China (PBC)

Cofinancing agencies

Intergovernmental Organizations

  • Inter-American Development Bank

Receiving agencies

State-owned Banks

  • Banco Nacional de Costa Rica (BNCR)

Implementing agencies

Intergovernmental Organizations

  • China Co-Financing Fund for Latin America and the Caribbean (CHC)

State-owned Banks

  • Banco Nacional de Costa Rica (BNCR)

Loan desecription

[China Co-Financing Fund] IDB administers 25 million USD loan from CHC to National Bank of Costa Rica for MSME Financing Partnership

Grace period•5 yearsGrant element•25.5544%Interest rate (t₀)•4.8235%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•10 years

Narrative

Full Description

Project narrative

On 7 May 2014, the Inter-American Development Bank (IDB) signed a loan contract with the National Bank of Costa Rica (Banco Nacional de Costa Rica, BNCR) for a MSME Financing Partnership, through which IDB would provide 75 million USD from its ordinary capital (Loan 3004/OC-CR), and the People's Bank of China would provide 25 million USD (Loan 3004/CH-CR) via the China Co-Financing Fund for Latin America and the Caribbean (CHC). The IDB approval date for this loan financing was 2 October 2013, and it refers to this project as "CR-L1069 : Banco Nacional de Costa Rica MSME Financing Partnership". According to BNCR financial statements, the loan had a ten year maturity with a final maturity date of 27 May 2024, and the annual interest rate would be the 6-Month LIBOR plus 4.5% during the first 5 years, and afterwards it would be the 6-Month LIBOR plus 5%. For the purposes of this project, the average 6-Month LIBOR in May 2014 (the date of signing of the agreement) was 0.323%, so the interest rate has been coded as 4.823%. It appears all the funds were disbursed by the end of 2014, with September 2015 records indicating the bank had a 100 million subordinated debt obligation to the IDB as of December 2014. The first repayment of the loan took place in 2019, with a total remaining debt obligation of 90 million USD. As of 31 December 2020, 70 million USD had yet to be repaid. Based on the timeline of the first repayment, this loan had a 5 year grace period including the disbursement period. The funds are to be used by BNCR for increasing access to finance for micro, small, and medium-sized businesses (SMEs) in Costa Rica, with a special emphasis on those led by women. Funds are to go to the Development Banking and Women's Banking programs of the National Bank of Costa Rica. The China Co-Financing Fund was established on 14 January 2013 with a contribution of 2 billion USD by the People's Bank of China, and it is administered by the IDB. For more information, see umbrella Record ID#86526.