IFC provides financing to Banco Santander Mexico to boost credit in Mexico

Mexico City, Mexico, January 25th, 2024. The International Finance Corporation (IFC), a member of the World Bank Group, announced that it will provide a credit guarantee of $93 million to Banco Santander Mexico so that can allocate more resources to financing small and medium-sized businesses (SMEs) in the country.

IFC's financing will be provided through a synthetic risk transfer (SRT), an innovative financial instrument that reduces regulatory capital charges on loans granted by banks, making it easier for them to release resources to offer new loans. Despite its effectiveness, the SRT is an underused instrument in Mexico and Latin America. IFC is the only multilateral development institution that offers these types of instruments in emerging markets.

Juan Gonzalo Flores, Country Manager of IFC Mexico, noted: "IFC is committed to innovation in investment and advisory services to help financial intermediaries reach the SME sector more effectively. According to a recent report by Banco de México, only 36.6 percent of companies with less than 100 employees have access to financing from commercial banks. With innovative transactions like this, Banco Santander México and IFC contribute to build a better future for Mexican SMEs."

SMEs generate between 70 and 95 percent of new jobs in emerging economies. By providing them with adequate resources, SMEs can improve their infrastructure, expand production capacity and increase competitiveness, which helps stimulate sustainable economic growth in Mexico.

About Banco Santander Mexico
Banco Santander México, S.A., Institución de Banca Múltiple, Grupo Financiero Santander México (Banco Santander México or the Bank), one of the main banks in Mexico, offers a wide range of financial products and services, including commercial and individual banking, services financial advisory services, as well as other investment activities. Banco Santander México offers a financial services platform aimed at the middle and upper segments of the population and small and medium-sized companies. It also provides integrated financial services to large multinational companies in Mexico. As of September 30, 2023, Banco Santander México had total assets of Ps.1,938 billion and more than 20.4 million clients. Headquartered in Mexico City, the Bank operates 1,343 branches and offices throughout the country and has a total of 26,757 employees.

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 2023, IFC committed a record $43.7 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, visit www.ifc.org.

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