BAC ES Debt The proposed project is an up to US$190 million financing package for Banco de America Central, S.A. (BAC ES or the Bank), consisting of: (i) an up to US$30 million senior unsecured A loan for IFC's own account (IFC A Loan), part of which benefits from US$15 million unfunded mobilization through the Managed Co-Lending Portfolio Program (FIG III program), in which IFC will transfer the credit risk to insurance companies, which results in a net IFC own account exposure of not more than US$30 million; (ii) up to US$120 million mobilization package through a B Loan facility; and (iii) an unfunded trade finance facility under IFCs Global Trade Finance Program (GTFP) of up to US$40 million with BAC El Salvador. (the Project).    The loan proceeds will be used to fund the growth of the Bank's climate-smart assets (including green mortgages and blue assets) and small and medium-sized enterprises (SMEs) including women SMEs (WSMEs).    The trade line will support short-term trade finance activities. The trade finance activities supported by the Project will be required to meet the requirements of the IFC's Exclusion List and other exclusions deemed necessary. The Project will not support any activities with significant E&S concerns such as: (a) involuntary resettlement; (b) risk of adverse impacts on Indigenous Peoples; (c) significant risks to or impacts on the environment, community health and safety, biodiversity, cultural heritage; or (d) significant occupational health and safety risks. It will also not support any activities related to upstream oil & gas production and activities related to coal such as coal mining, coal transportation, coal-fired power plants, or infrastructure services exclusively dedicated to support any of these activities. IFC will review the details of the underlying trade transactions to confirm that they do not include activities in the IFC Exclusion List and any other exclusions. Stakeholders effects: Increased access to finance for SMEs including WSMEs: IFC expects the Project will support the Bank to grow its SME portfolio. El Salvador is ranked 124th (from 190 countries) based on the 2018 Gender Inequality Index. Women-led businesses are typically constrained by access to credit versus men-led businesses. 

Stakeholders effects  Improved access to finance for climate-smart assets, including energy efficiency, green building, and climate-smart agriculture projects: IFC expects that this Project will provide access to finance for climate-smart assets projects in El Salvador. In addition to the countrys heightened vulnerability to climate risks,  its GHG emissions have been increasing, amounting to 15 million metric tons of MtCO2 equivalent per year in 2015 (i.e., 2 MtCO2 equivalent per capita in 2015). The Project will be complemented with supplementary advisory services aimed at helping the Bank establish a climate finance line of business.

Contribution to Market Creation: Sustainability. Given the relatively underdeveloped state of the climate finance market in El Salvador, IFCs engagement will promote green financing standards, through (i) capacity building (ii) market awareness; and (iii) client monitoring/certification processes. The climate initiative will support BAC ES expand and diversify its operations in climate finance in the country.