Project detail - BANCOP S.A

Who is our client

Banco Para la Comercialización y la Producción, Bancop S.A. (“Bancop”) is a private universal bank in Paraguay. It is owned by a group of 29 productive cooperatives tied to the country’s agriculture, cattle and agro-industrial sectors. Bancop started operations in 2012 and has been growing rapidly; by August 2020, it had USD 570 mln in total assets. Its loan portfolio is dedicated to SMEs and corporate clients mainly active in the agriculture and cattle value chains, as well as other sectors of the economy.

Funding objective

The USD 30 mln facility will be dedicated to finance SME clients, in line with FMO’s definition, thereby contributing to decent work and economic growth. The total USD 30 mln transaction refers to a committed tranche of USD 15mln and an uncommitted tranche of USD 15mln (which may be activated).

Why we fund this project

Bancop has been a relevant partner for FMO as a member of the Paraguayan sustainable finance roundtable, 'Mesa de Finanzas Sostenibles'. The bank's advanced E&S practices and its focus on commercial clients in key sectors of the economy make Bancop an ideal partner for FMO to support and promote investments in SMEs in Paraguay. This becomes highly relevant in the context of the ongoing COVID-19 crisis, with Bancop aiming to continue supporting clients with financing for working capital and long term investments.

Environmental and social rationale

The bank’s portfolio is considered medium risk; however, because of contextual issues in the country and sectors where the client operates Bancop has been categorised as a Category FI-A in accordance with FMO’s Sustainability Policy. Contextual issues in Paraguay and the large proportion of loans to clients in the agriculture, cattle and agroindustry sectors means that the bank’s investments could have adverse environmental and social impacts such as land conversion, greenhouse gas emissions and pollution. Bancop is an existing client of FMO, and as such is required to adhere to EDFI Exclusion List and Paraguay E&S laws and regulations as well as the applicable IFC Performance Standards. All IFC Performance Standards can potentially be triggered in Bancop’s portfolio; however, the client being a Financial Institution, FMO’s assessment focused on IFC PS1 and PS2 which determine the client’s ability to evaluate IFC PS applicability in its transactions.

More investments

Date	Total FMO financing
12/13/2021	USD 10.00 MLN
12/17/2020	USD 7.50 MLN
9/21/2018	USD 7.50 MLN