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| Nanchong CCB |
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| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 27390 |
| Company name | Nanchong City Commercial Bank |
| Country | China |
| Sector | Finance & Insurance |
| Environmental category | FI |
| Department | Global Financial Markets Group |
| Status | Pend PDS-IR |
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| Date SPI disclosed | June 13, 2008 |
| Projected board date | July 14, 2008 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
Nanchong City Commercial Bank (Nanchong CCB) was established in 2001 through a merger of 10 urban credit cooperatives. With a mandate of helping SMEs’ access to finance, Nanchong CCB has achieved sound development in the past several years. DEG, member of Germany's leading bank KfW Bankengruppe and Sparkassen International Development Trust (SIDT) took equity stake in Nanchong CCB in 2005. In the meantime, the Savings Banks Foundation for International Cooperation (SBFIC) agreed to provide technical assistance.
Nanchong CCB positions itself as a full-service bank to SMEs, private enterprises, self-employed entrepreneurs and individuals. As of December 31, 2007, total assets and capital of the bank reached RMB 10.7 billion and RMB 470 million respectively. At present, the bank has 856 SME clients and 11,186 individual clients. |
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| Project sponsor and major shareholders of project company |
The purpose of the project is to help SMEs in the greater Chengdu metropolitan area get much needed financing to restore and/or expand their production and operation capacity in the aftermath of recent earthquake in Sichuan Province, China.
Nanchong CCB has a diversified shareholding structure. In July 2005, DEG took a 10% equity stake to become the largest shareholder of the bank while SIDT took a 3.33% equity stake in the bank. Currently, Nanchong Municipal Government holds 3.33% of the bank. Except for DEG, SIDT and Nanchong Municipal Government, the other shareholders are all private firms and natural person. |
| Total project cost and amount and nature of IFC's investment |
| The proposed IFC investment is an up to $30 million equivalent loan or risk sharing facility for IFC’s own account to Nanchong CCB. |
| Location of project and description of site |
| Nanchong CCB is headquartered in Nanchong, a city 200 kilometers east to Chengdu, capital city of Sichuan Province, China. In October 2007, the bank established a branch in Chengdu and plans to set up 3 sub-branches in Chengdu in the year of 2008. |
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| Anticipated development impact of the project |
| This project will have strong development impact. It will signify IFC’s continuing support of the reform and restructuring of China’s banking system as well as serve as a part of outpouring of international support to the earthquake hit Sichuan Province. It is expected to be one of the first market-based initiatives focusing on restoring private sector capacity, with most beneficiaries being SMEs. |
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| IFC's expected development contribution |
| In addition to the proposed loan/risk sharing facility, IFC will also provide advisory services to Nanchong CCB to help improve its institutional capability. |
| Environmental and social issues - Category FI |
This project has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure.
During appraisal, IFC will analyze the FI portfolio and the activities proposed to be supported with IFC financing for types of transactions, size, tenor and industry sectors and determine the Applicable Performance Requirements, if any, that would include a combination of:
- The IFC FI Exclusion List;
- The applicable National Social and Environmental Laws and regulations; and/or
- The IFC Performance Standards.
IFC will also review, if required, the capacity of the FI to manage social and environmental risks and to establish and maintain a Social & Environmental Management System (SEMS). If required, IFC will suggest Supplemental Actions to address any gaps in the SEMS.
Based on the review, the project will be required to:
- Develop an, or upgrade, if necessary, any existing Social & Environmental Management System (SEMS), prior to disbursement to the satisfaction of IFC;
- Identify responsible, qualified persons to manage and implement the SEMS;
- Commit to implement the SEMS, to ensure that its investments/activities supported by IFC financing are in compliance with the Applicable Performance Requirements;
- Submit a periodic report to IFC as per a format to be provided by IFC. |
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| For inquiries about the project, contact: |
Ms. Jian Ting
No. 301, Wenhua Road,
Nanchong 637000, China
Telephone: 86-817-2228870
Fax: 86-817-2228870
E-mail: nccb@263.net
Website: http://www.cgnb.cn |
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| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
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