The IFC Structured and Securitized Products Group develops products that provide clients with forms of cost-effective financing that would not otherwise be readily accessible. The group offers credit enhancement structures for debt instruments (bonds and loans) through partial credit guarantees, risk sharing facilities, and participations in securitizations.
Partial credit guarantees allow IFC to use its international triple-A credit rating to help clients diversify their funding sources, extend maturities, and obtain financing in their currency of choice, including local currency. In securitization transactions, IFC participates as a structuring investor or guarantor, typically at the mezzanine level of risk. Risk sharing facilities allow a client to transfer credit risk to IFC from their own portfolio, or from a new portfolio they originate.
IFC is involved in both domestic and cross-border transactions, with an emphasis on domestic transactions that provide clients with long-term local currency financing. Through partial credit guarantees, IFC is able to provide credit in local currency in most countries. In countries with established or nascent bond markets, the group is often able to structure a capital markets solution for clients in an effort to diversify their funding sources away from the traditional bank market. In countries without a capital market, IFC can structure financing solutions on a bilateral basis or with domestic financial institutions. Other local currency financing alternatives include loans or swaps offered by the Derivative Products and Asset Liability Management Group.
For clients with hard-currency revenues, IFC can structure credit enhancement for cross-border deals in order to extend the tenor of available financing or enable access to international institutional investors.
The range of products and the countries and currencies in which IFC offers Structured and Securitized Products services continues to grow, as the Corporation innovates to help clients efficiently manage their assets and liabilities. The group works closely with IFC’s regional and industry sector departments in all aspects of structured deals, including origination, structuring, modeling, and execution. For capital markets deals, Structured and Securitized Products assists clients in their discussions and negotiations with other counterparts, including regulators, rating agencies, investment banks, external counsel, and investors. As with all of IFC’s investments, these transactions must meet strict investment criteria and fit with IFC’s mission.
Last Updated July 31, 2009
