[China Co-Financing Fund] IDB administers 20 million USD loan from CHC to Banco Pichincha for Credife: Financial Services and Microenterprise Development

On 16 July 2014, the Inter-American Development Bank (IDB) authorized a loan for Banco Pichincha (BP) to finance Credife: Financial Services and Microenterprise Development. The IDB authorized the provision of up to 40 million USD from its ordinary capital, including 10 million USD resources from the Opportunities for the Majority Financing Facility (Loan 3250A/OC-EC-1, Loan 3250A/OC-EC-2), and the provision of up to 20 million USD from the China Co-Financing Fund for Latin America and the Caribbean (CHC) (Loan 3250/CH-EC), which is a trust fund that is fully financed by a contribution from the People's Bank of China. The IDB would also administer a B loan for up to 20 million USD, which would be financed by other commercial banks or financial institutions (Loan 3250B/OC-EC-1-PN-BAALPNB, Loan 3250B/OC-EC-2, Loan 3250B/OC-EC-1-NE-TRIOZSB). This loan would have a maturity of 6 years with a a 3 year grace period. The IDB has two project entries connected to this transaction, which are referred to as "EC-L1139 : Credife - Micro-enterprises Financing Partnership" and "EC-L1104 : Credife: Financial Services and Microenterprise Development for the BoP". On 25 February 2015, the IDB signed the loan contract with Banco Pichincha. Media reports from March 2015 indicate that Banco Pichincha received an 80 million USD loan from the IDB with a 7-year maturity and an initial interest rate of 5.5%. The 2017 Annual Report from Banco Pichincha lists a debt obligation of 71 million USD owed to the IDB as of 31 December 2017, with an interest rate of 6M LIBOR + 5.12%. The average 6M LIBOR in February 2015 (the date of signing of the agreement) was 0.376%, and plus the 5.12% margin would equal 5.496%. This 2017 Annual Report also lists a final amortization date in June 2021 (about 6.5 years following the signing of the loan contract). There are no annual reports available for 2015 or 2016, but it seems this loan referenced in the 2017 Annual Report is the same one that was provided in February 2015. As of the end of 2020, Banco Pichincha had 9.643 million USD remaining as a debt obligation. The loan was intended to expand Banco Pichincha's ability to provide financing to micro and small businesses, particularly for acquisition of fixed assets, associated working capital, and improvements to retail space. It would also help Banco Pichincha increase its geographical reach. 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 project ID #86526.

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