Sao Paulo, Brazil, February 2, 2023—IFC subscribed $200 million in a gender bond to Itaú Unibanco to support the bank's lending program to women-owned small and medium enterprises in Brazil, with parts of the proceeds focused on businesses based in underserved regions of the North and Northeast of the country.
The project represents the first gender bond issued by a private bank in Brazil in the form of Letras Financeiras (LFs), an exclusive debt security instrument for local financial institutions. IFC is also acting as an anchor investor to help mobilize other investors to participate in the issuance with up to $200 million.
The proceeds of the gender bond will be used to support women-owned small and medium enterprises (WSMEs) who face more difficulty in securing funding than men-owned businesses. According to data from the World Bank's Global Findex Database and the World Economic Forum, while 4.6 percent of male-owned businesses in Brazil are able to borrow to start, operate, or expand a business, only 2.9 percent of women-owned businesses can access finance for the same purposes. Part of IFC's investment to Itaú will focus on promoting and supporting access to finance for women in the North and Northeast of Brazil, which will help generate economic and employment opportunities in those underserved regions.
Gender bonds aim to promote positive social outcomes by being exclusively dedicated to help achieve gender equality. These types of bonds are usually issued by financial institutions to fund loan portfolios that are solely intended for women entrepreneurs and women-owned enterprises.
"IFC's long-running partnership with Itaú showcases that supporting the financial and economic empowerment of women is vital for an inclusive and sustainable growth and to help Brazil tackle its development challenges, including those of productivity and competitiveness," said Carlos Leiria Pinto, IFC Brazil Country Manager. "The use of innovative financial instruments helps accelerate market inclusiveness by encouraging other banks to increase their footprint in gender-themed instruments of their own."
"The issuance of Letras Financeiras linked to social issues reflects not only our commitment to generating a positive impact, but also the growing appetite of investors for this type of debt security. This project represents the biggest operation in the Brazilian capital market with a focus on gender", said Daniel Goretti, Treasury director at Itaú Unibanco.
Itaú and IFC have worked together in several projects over the years, including investments and advisory services focused on different products and segments, such as capital markets, gender finance, microfinance, and climate finance. In 2022, IFC provided $300 million to Itaú in a green bond to support lending for the acquisition of climate-smart vehicles in Brazil.
The signing of the gender bond marks the 10-year anniversary of Itaú Mulher Empreendedora, a capacity building program created by IFC and Itaú, designed to inspire, connect, and enable women entrepreneurs in their professional journeys. With a new focus on strengthening afro-descendent female-led businesses in the North and Northeast of Brazil, more than 350,000 women have already taken part in trainings, workshops, and acceleration initiatives offered by the program for which Itaú was recognized as Best Bank for Women Entrepreneurs by the SME Finance Forum.
This investment is part of IFC's Banking on Women (BoW). Since its launch in 2010, IFC's BoW has been providing financial and business solutions to women-led SMEs through its financial institution partners, with 204 investment and advisory services projects in 70 countries.As of December 2022, IFC's BoW business has mobilized and invested more than $4 billion in financial institutions, specifically to finance women-led SMEs.
The project is also supported by the Women Entrepreneurs Opportunity Facility (WEOF) and the Women Entrepreneurs Finance Initiative (We-Fi) through a performance-based incentive. WEOF is an initiative launched by IFC—in partnership with the Goldman Sachs Foundation—to help expand access to capital for women entrepreneurs in developing countries and demonstrate the commercial viability of investing in women.
"We are pleased to continue to empower female entrepreneurs through access to capital in order to facilitate their growth and recharge their businesses," said Charlotte Keenan, Global Director of Goldman Sachs 10,000 Women. "We look forward to supporting Itaú Unibanco as it expands lending to women-owned businesses in Brazil."
About Itaú Unibanco
Itaú Unibanco's purpose is to promote people's power of transformation and we do it through a strategic agenda focused on client centricity and digital transformation, based also on the diversity of our people. The largest bank in Latin America, Itaú Unibanco is present in 18 countries and has more than 65 million customers, among individuals and companies in all segments, to whom we offer the best experiences in financial products and services. Itaú Unibanco has been selected for the 21st consecutive time to be part of the Dow Jones Sustainability World Index (DJSI World), being the only Latin American financial institution to be part of the index since its creation in 1999. www.itau.com.br
About Goldman Sachs 10,000 Women
Goldman Sachs 10,000 Women is an initiative to foster economic growth by providing women entrepreneurs around the world with a business and management education, opportunities and access to capital to grow their businesses. The initiative has reached 10,000 women from over 150 countries through a network of over academic, nonprofit, and bank partners. In partnership with the International Finance Corporation (IFC), Goldman Sachs 10,000 Women launched the first of its kind global finance facility in 2014 to enable access to capital to more women entrepreneurs. And now, by leveraging technology the 10,000 Women curriculum is available online through Coursera, creating access to a business education in more corners of the world. For more information on Goldman Sachs' philanthropic investment in female entrepreneurs, Visit https://www.goldmansachs.com/citizenship/10000women.
About We-Fi
The Women Entrepreneurs Finance Initiative (We-Fi) is a collaborative partnership among the 14 governments that have made financial contributions, six multilateral development banks that serve as implementing partners, and other public and private stakeholders. We-Fi was formally established in October 2017 as a Financial Intermediary Fund hosted by the World Bank. We-Fi invests in programs and projects that help unlock billions of dollars in financing to address the full range of barriers facing women entrepreneurs—increasing access to finance, markets, technology, and mentoring, while strengthening policy, legal and regulatory frameworks. As one of the We-Fi Implementing Partners, IFC supports private sector clients with investment and advisory services to expand financial services and market access for women-owned/led firms, as well as increasing the capacity of women entrepreneurs to run high-growth businesses. For more information, visit www.we-fi.org.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visitwww.ifc.org.
Stay Connected
www.ifc.org/lac
www.twitter.com/IFC_LAC
www.linkedin.com/company/ifc-américa-latina-y-el-caribe
www.facebook.com/IFCwbg
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www.youtube.com/IFCvideocasts
www.twitter.com/IFC_org
The project represents the first gender bond issued by a private bank in Brazil in the form of Letras Financeiras (LFs), an exclusive debt security instrument for local financial institutions. IFC is also acting as an anchor investor to help mobilize other investors to participate in the issuance with up to $200 million.
The proceeds of the gender bond will be used to support women-owned small and medium enterprises (WSMEs) who face more difficulty in securing funding than men-owned businesses. According to data from the World Bank's Global Findex Database and the World Economic Forum, while 4.6 percent of male-owned businesses in Brazil are able to borrow to start, operate, or expand a business, only 2.9 percent of women-owned businesses can access finance for the same purposes. Part of IFC's investment to Itaú will focus on promoting and supporting access to finance for women in the North and Northeast of Brazil, which will help generate economic and employment opportunities in those underserved regions.
Gender bonds aim to promote positive social outcomes by being exclusively dedicated to help achieve gender equality. These types of bonds are usually issued by financial institutions to fund loan portfolios that are solely intended for women entrepreneurs and women-owned enterprises.
"IFC's long-running partnership with Itaú showcases that supporting the financial and economic empowerment of women is vital for an inclusive and sustainable growth and to help Brazil tackle its development challenges, including those of productivity and competitiveness," said Carlos Leiria Pinto, IFC Brazil Country Manager. "The use of innovative financial instruments helps accelerate market inclusiveness by encouraging other banks to increase their footprint in gender-themed instruments of their own."
"The issuance of Letras Financeiras linked to social issues reflects not only our commitment to generating a positive impact, but also the growing appetite of investors for this type of debt security. This project represents the biggest operation in the Brazilian capital market with a focus on gender", said Daniel Goretti, Treasury director at Itaú Unibanco.
Itaú and IFC have worked together in several projects over the years, including investments and advisory services focused on different products and segments, such as capital markets, gender finance, microfinance, and climate finance. In 2022, IFC provided $300 million to Itaú in a green bond to support lending for the acquisition of climate-smart vehicles in Brazil.
The signing of the gender bond marks the 10-year anniversary of Itaú Mulher Empreendedora, a capacity building program created by IFC and Itaú, designed to inspire, connect, and enable women entrepreneurs in their professional journeys. With a new focus on strengthening afro-descendent female-led businesses in the North and Northeast of Brazil, more than 350,000 women have already taken part in trainings, workshops, and acceleration initiatives offered by the program for which Itaú was recognized as Best Bank for Women Entrepreneurs by the SME Finance Forum.
This investment is part of IFC's Banking on Women (BoW). Since its launch in 2010, IFC's BoW has been providing financial and business solutions to women-led SMEs through its financial institution partners, with 204 investment and advisory services projects in 70 countries.As of December 2022, IFC's BoW business has mobilized and invested more than $4 billion in financial institutions, specifically to finance women-led SMEs.
The project is also supported by the Women Entrepreneurs Opportunity Facility (WEOF) and the Women Entrepreneurs Finance Initiative (We-Fi) through a performance-based incentive. WEOF is an initiative launched by IFC—in partnership with the Goldman Sachs Foundation—to help expand access to capital for women entrepreneurs in developing countries and demonstrate the commercial viability of investing in women.
"We are pleased to continue to empower female entrepreneurs through access to capital in order to facilitate their growth and recharge their businesses," said Charlotte Keenan, Global Director of Goldman Sachs 10,000 Women. "We look forward to supporting Itaú Unibanco as it expands lending to women-owned businesses in Brazil."
About Itaú Unibanco
Itaú Unibanco's purpose is to promote people's power of transformation and we do it through a strategic agenda focused on client centricity and digital transformation, based also on the diversity of our people. The largest bank in Latin America, Itaú Unibanco is present in 18 countries and has more than 65 million customers, among individuals and companies in all segments, to whom we offer the best experiences in financial products and services. Itaú Unibanco has been selected for the 21st consecutive time to be part of the Dow Jones Sustainability World Index (DJSI World), being the only Latin American financial institution to be part of the index since its creation in 1999. www.itau.com.br
About Goldman Sachs 10,000 Women
Goldman Sachs 10,000 Women is an initiative to foster economic growth by providing women entrepreneurs around the world with a business and management education, opportunities and access to capital to grow their businesses. The initiative has reached 10,000 women from over 150 countries through a network of over academic, nonprofit, and bank partners. In partnership with the International Finance Corporation (IFC), Goldman Sachs 10,000 Women launched the first of its kind global finance facility in 2014 to enable access to capital to more women entrepreneurs. And now, by leveraging technology the 10,000 Women curriculum is available online through Coursera, creating access to a business education in more corners of the world. For more information on Goldman Sachs' philanthropic investment in female entrepreneurs, Visit https://www.goldmansachs.com/citizenship/10000women.
About We-Fi
The Women Entrepreneurs Finance Initiative (We-Fi) is a collaborative partnership among the 14 governments that have made financial contributions, six multilateral development banks that serve as implementing partners, and other public and private stakeholders. We-Fi was formally established in October 2017 as a Financial Intermediary Fund hosted by the World Bank. We-Fi invests in programs and projects that help unlock billions of dollars in financing to address the full range of barriers facing women entrepreneurs—increasing access to finance, markets, technology, and mentoring, while strengthening policy, legal and regulatory frameworks. As one of the We-Fi Implementing Partners, IFC supports private sector clients with investment and advisory services to expand financial services and market access for women-owned/led firms, as well as increasing the capacity of women entrepreneurs to run high-growth businesses. For more information, visit www.we-fi.org.
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2022, IFC committed a record $32.8 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visitwww.ifc.org.
Stay Connected
www.ifc.org/lac
www.twitter.com/IFC_LAC
www.linkedin.com/company/ifc-américa-latina-y-el-caribe
www.facebook.com/IFCwbg
www.instagram.com/ifc_org/
www.youtube.com/IFCvideocasts
www.twitter.com/IFC_org
www.ifc.org/SocialMediaIndex
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