IDB Invest finances Fund to support companies with sustainable business models

  • The fund is the first of its kind in Latin America and Caribbean to promote biodiversity conservation through financial institutions.

IDB Invest, the private sector institution of the Inter-American Development Bank (IDB) Group, provided a loan of up to US$60 million to the Fund. The financing in the form of a subordinated loan includes a US$20 million subordinated co-loan from the China Co-financing Fund for Latin America and the Caribbean.

IDB Invest’s financing will increase access to finance to businesses contributing to biodiversity conservation and the sustainable use of natural resources. It also will allow the Fund to become a sustainable investment platform reaching the critical milestone of US$300 million of total capital commitments and will help the Fund enhance its impact and outreach in Latin America and the Caribbean.

The Fund, as the first of its kind initiated by KfW (German Development Bank), has a current size of around US$230 million. The Fund’s advisor is Finance in Motion GmbH, a leading impact asset manager, with approximately US$2.2 billion in assets under management. The fund partners with financial institutions in Latin America and the Caribbean to channel financing to sustainable businesses, specifically those with focus in organic agriculture and agri-processing, sustainable forestry, sustainable fishery and aquaculture, and eco-tourism. The fund’s clients receive a mix of financial and non-financial support, that incentivizes regional financial institutions to shift their activities toward a more sustainable lending approach.

The fund promotes the connection between financial institutions interested in sustainable businesses, institutional investors and technical assistance resources. Other investors in the Fund are the German Development Bank (KFW), the German Government through the Federal Ministry for Economic Cooperation and Development (BMZ), the United Kingdom’s Department for Environment, Food and Rural Affairs (DEFRA), the Du tch Development Bank (FMO), the European Commission, the Austrian Development Bank (OeEB) and private sector investors.

About IDB Invest
IDB Invest, the private sector institution of the Inter-American Development Bank (IDB) Group, is a multilateral development bank committed to supporting Latin America and the Caribbean businesses. It finances sustainable enterprises and projects to achieve financial results that maximize economic, social and environmental development for the region. With a current portfolio of $11.2 billion under management and 330 clients in 23 countries, IDB Invest works across sectors to provide innovative financial solutions and advisory services that meet the evolving demands of its clients. As of November 2017, IDB Invest is the trade name of the Inter-American Investment Corporation.

About the Fund
The Fund aims to promote business and consumption practices that contribute to biodiversity conservation, to the sustainable use of natural resources, and to mitigate climate change and adapt to its impacts. By providing financing for business practices that conserve nature and foster biodiversity, the fund seeks investments with both environmental and financial returns. The fund mainly provides loans to qualified financial institutions that on-lend the money to eligible borrowers to spport sustainable operations in the sectors of agriculture, fishery (including aquaculture), forestry and tourism. The Fund was initiated by Germany’s KfW Development Bank and Conservation International with financial support from the German Federal Ministry for Economic Cooperation and Development (BMZ). It has received further donor support from the European Commission.