| Project description |
| The proposed investment is a joint initiative of IFC’s Health and Education and Financial Markets departments and involves the establishment of a risk sharing facility (the “Facility”), with Bank AlFalah Limited (“AlFalah”) in Pakistan. The Facility is proposed to be approximately $50 million in size and would focus on making loans to private companies operating in the health care sector – including hospitals, clinics, laboratories and pharmaceutical companies – across Pakistan. IFC has already approved an US$20 million uncommitted trade finance guarantee facility under the IFC’s Global Trade Finance Program to AlFalah. |
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| Project sponsor and major shareholders of project company |
| The Abu Dhabi Group, which owns a majority of AlFalah, is one of the leading conglomerates in the UAE with diversified interests in banking, telecoms, pharmaceutical and property and has presence in Pakistan, Bangladesh and Africa. It is considered one of the largest foreign direct investors in Pakistan. The Abu Dhabi Group has seven core investors, four of whom are from the ruling family of Abu Dhabi and the other three are well known businessmen in the UAE. |
| Total project cost and amount and nature of IFC's investment |
| The total size of the Facility is estimated to be $50 million. Under the proposed terms of the Facility, AlFalah would be responsible for generating a portfolio of loans that satisfy certain criteria to be set by the Bank and IFC after the appraisal. IFC’s participation would involve taking risk on 50 percent of the senior tranche of that portfolio. This exposure would be protected by a first loss provided by AlFalah. |
| Location of project and description of site |
| The participating private health care companies will be located throughout Pakistan. |
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| Anticipated development impact of the project |
| The proposed investment will have a strong development impact in helping to improve the quality and financial and managerial capacity of SME private health care companies in Pakistan. In doing so, the Facility will widen access to health-related goods and services in that country. Public sector expenditure is unable to keep up with the demand for health-related goods and services in Pakistan and the poor quality and unreliability of publicly-provided services has given rise to a prominent private sector. This investment will permit IFC to support the small and relatively unsophisticated health care companies that play such an important role in Pakistan’s health care system. |
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| IFC's expected development contribution |
| IFC’s guarantee and advisory program will be beneficial for health care providers in Pakistan by improving: (i) access to finance; (ii) terms of borrowing (e.g. by extending tenors); and (iii) financial, strategic and operational management. In addition, IFC’s proposed investment complement’s AlFalah’s strategy to prioritize support to the health care sector and will enable the Bank to manage risk and grow its health care assets at a faster pace than it would on its own. |
| 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 Requirements, if any, that would include a combination of:
The IFC FI Exclusion List(s);
The applicable National Environmental and Social Laws and regulations;
The IFC Performance Standards.
IFC has a trade finance project with Alfalah, however there were no specific Environmental and Social requirements for that facility. As a result 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 Requirements above;
Commit to take action to remedy any gaps in SEMS implementation on an ongoing basis;
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: |
Syed Hassan
Assistant General Manager, Treasury & Financial Institutions Group
Telephone: 92 21 111-777-786 (Ext: 2212)
Fax: 92 21 2418565 |
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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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