[China Co-Financing Fund] IDB administers $25 million loan from CHC to Banco General for Housing Financing Partnership

On December 5, 2014, the Inter-American Development Bank (IDB) signed two loan contracts (an ‘A/B loan facility’) with Banco General Panamá, S.A. to finance the Housing Financing Partnership: the ‘A loan’ facility consisted of a $50 million loan that IDB issued from its ordinary capital (Loan 3245A/OC-PN), and a $25 million loan from the People's Bank of China (Loan 3245/CH-PN) via the China Co-Financing Fund for Latin America and the Caribbean (CHC). The IDB also administered a ‘B loan facility’ of of up to $25 million, which was financed by other commercial banks and financial institutions (Loan 3245B/OC-PN). The IDB approval date for the loan financing was July 3, 2014, and it refers to this project as ‘PN-L1102: Banco General Housing Financing Partnership. The A loan facility reportedly carries the following borrowing terms: a 7-year maturity and a 1-year grace period. The A/B loan proceeds were to be used to support the borrower’s origination of residential mortgage loans to sub-borrowers (low and middle income first-time homebuyers) in the Republic of Panama. More generally, the project sought to facilitate the acquisition of primary dwellings by households in Panama, closing the housing deficit in the country, and improving living conditions of families. The IDB identifies the current project status as ‘Closed’, which AidData treats as evidence that the project has reached completion.

Additional details

1. AidData has set the transaction (financial commitment) amount to the amount authorized on July 3, 2014, based on the assumption that the amount provided in the loan contract is the same amount that was authorized. However, this issue warrants further investigation. 2. The U.S. based firm of Andrews Kurth LLP, advised the IDB as international counsel. Local legal advice was provided by Alfaro, Ferrer & Ramírez in Panama. 3. Banco General Panamá, S.A. is Panama’s largest bank. Banco General S.A. It is a wholly-owned subsidiary of Empresa General de Inversiones, S.A. a publicly-traded Panamanian corporation. 4. The Spanish project title is Alianza con Banco General para el Financiamiento de Viviendas. 5. The China Co-Financing Fund for Latin America and the Caribbean was established on January 14, 2013 with a contribution of $2 billion by the People's Bank of China. It is administered by the IDB. For more information, see umbrella Project ID#86526.

Number of official sources

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