Information on the Target

Sudameris Bank S.A.E.C.A., established in 1958, is one of Paraguay's foremost commercial banks and currently ranks as the second-largest bank in the country. With a robust presence across Paraguay, Sudameris boasts an extensive branch network and cutting-edge digital platforms. The bank has solidified its reputation as a pioneer in structured finance by being the first in Paraguay to introduce various financial solutions, including project finance and leasing.

Sudameris Bank's strategic focus is centered on digital transformation, customer-centric innovation, and backing critical economic sectors. This commitment is evident in its active role in lending to SMEs and advancing initiatives that foster sustainable economic development.

Industry Overview in Paraguay

Paraguay's economy has witnessed significant growth in recent years, marked by the emergence of diverse projects across various sectors, including pulp and forestry, cotton, hydrogen, and solar photovoltaic initiatives. Such developments, alongside a thriving agricultural sector, highlight the growing need for accessible long-term financing solutions that cater to the dynamic landscape of the Paraguayan economy.

The country's traditional industries, particularly agriculture and livestock, remain vital for its economic stability, emphasizing the importance of quality financing that can support both large-scale initiatives and smaller businesses. This demand has been further exacerbated by a global shift towards sustainable and responsible investment, putting added pressure on financial institutions to align their offerings with these evolving market trends.

Moreover, Paraguay's potential in green finance is on the rise, fueled by a strong governmental push towards environmental sustainability and an inclusive economy. The integration of climate policies into financing frameworks is gaining traction, setting the stage for innovative financial solutions that can bolster economic resilience and sustainability.

The Rationale Behind the Deal

The USD 370 million A/B syndicated senior unsecured term loan facility is a strategic move designed to facilitate Sudameris Bank's expansion into green finance and SME lending, especially within the agricultural sector and its supporting value chains. This financing aims to enhance financial inclusion, ensuring that underserved segments of the population, including women-owned SMEs, have improved access to capital.

A significant portion of the proceeds will be allocated to climate-related projects, reflecting Sudameris' dedication to sustainability and its leading role in the financial sector. By partnering with esteemed development finance institutions, the deal is positioned to make a substantial impact on regional economic development.

Information About the Investor

FMO, the Dutch development bank, is at the forefront of this landmark transaction as the lead arranger and agent. With a strong mission to enhance sustainable development through the private sector, FMO's investment strategy emphasizes impactful initiatives across emerging markets. The facility's structure includes a USD 122.5 million A-loan allocated for FMO's own account, along with additional contributions from various high-profile development finance institutions and commercial banks, showcasing a collective commitment to fostering growth in Paraguay.

Other notable participants in this syndication include FinDev Canada, JICA, Proparco, Banco Finantia, and the Commercial Bank of Dubai, each bringing their own expertise and resources to empower Sudameris Bank in addressing the growing financing needs of Paraguay's economy.

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From an investment perspective, this transaction can be seen as a commendable step towards enhancing Sudameris Bank's financial footing and expanding its operations. The facility offers a robust financing structure that aligns well with current market demands for sustainable and inclusive financial solutions. By supporting the bank’s commitment to promoting green projects, this deal not only appeals to socially conscious investors but also positions Sudameris Bank as a leader in the region’s financing landscape.

The collaboration among multiple international stakeholders signifies a growing interest in Paraguay's economic potential and the sustainability of its financial sector. This syndication sets a precedent for future financial initiatives in Paraguay, providing a model for how local institutions can leverage international support to achieve transformative growth.

Furthermore, the involvement of specialized partners in climate finance indicates that this venture is not merely about profit but also about contributing positively to environmental goals. This dual focus presents a unique opportunity for investors to be part of a larger movement towards sustainable economic development.

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