IDB Invest supports debt capital solutions to finance initiatives with a positive development impact across a variety of segments such as corporates, financial intermediaries, and infrastructure and energy.
The capital markets allows issuers to diversify funding sources beyond standard bank lending, allowing them to achieve longer tenors in different currencies, and to obtain greater visibility in the market.
• Access to local and international capital markets
• Flexible financing options
• Customized financial solutions
• Mobilizing additional investors
• Structuring of longer-term debt
• Access new funding sources
• Promoting new asset classes
• Developmental impact
• Regional expertise and knowledge
• Advisory services
• Greater transparency and disciplined execution
Opportunities
IDB Invest contributes to the development of local debt capital markets while supporting private sector expansion and increasing countries’ resilience to adverse external shocks.
Solutions
IDB Invest’s Debt Capital Markets Solutions Team supports companies in Latin America and the Caribbean to access capital markets, support market development, mobilize investors and promote new asset classes such as thematic bonds.
Financing through the debt capital markets helps our clients: widen their investor base outside of bank lending, structure longer-term debt, promote greater transparency and disciplined execution, and access new funding sources.
Trade and Supply Chain Finance
We facilitate innovative trade finance solutions through short- and medium-term loans and guarantees to cover the needs of the value chain of anchor clients.
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Resource Mobilization
As a multilateral development bank, we can structure loans and bonds to expand the pool of funds available for investment in the private sector.
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Thematic Bonds
What are Thematic Bonds?
Debt capital markets solutions to fund social and/or climate projects. Thematic bonds can be "use of proceeds" bonds or performance based-bond:
• "Use-of-proceeds" bonds: Green bonds are used solely for environmental goals, social bonds are dedicated to projects aimed at improving social welfare, and sustainability bonds combine both social and environmental objectives.
• Perfomance-based bond: The financial characteristics of Sustainability-Linked Bonds are adjusted based on the achievement of predefined sustainability targets. Thematic Bonds are an essential instrument to achieve investments towards the Sustainable Development Goals (SDGs)
Thematic bonds support access to long-term financing in the capital markets and help to diversify their sources of funding.
Proceeds from Green bonds are exclusively allocated to financing projects with an evident environmental benefit: Renewable energy, biodiversity conservation, clean transportation, and ecological construction.
Proceeds from Social Bonds are exclusively allocated to financing projects with an evident positive social impact, especially on vulnerable groups such as the unemployed or people below the poverty line: Renewable energy, biodiversity conservation, clean transportation, and ecological construction.
Proceeds from Sustainable Bonds are exclusively applied to finance a combinarion of both Green and Social projects.
THEMATIC BONDS SUPPORTED BY IDB INVEST
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How we contribute to the creation of thematic bonds:
• Bond Purchase: We purchase all or a part of a bond issuance.
• Warehousing Line: We grant revolving lines to acquire and accumulate assets for an exit in the capital markets.
• Partial/Total CG: We cover partially or completely the payment obligations of bonds.
• B-Bond: We create structures to mobilize institutional investors.
IDB Invest advises a thematic bond issuer on developing the social, green, and sustainability criteria and maintaining them over the life cycle of the bond.We guide the clients in:
• Identifying in their portfolio the best opportunity for a thematic bond issuance.
• Developing the bond framework.
• Selecting the independent firm for a second party opinion, verification or certification (for green bonds).
• Sustainable Protocols
• Sector Guides
• Publication
• Events
Publications
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May 2021Financing Sustainability through Capital Markets: A Practitioner's Guide and Toolkit for Thematic Bonds
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June 2021Factsheet: Accelerating Blue Bonds Issuances in Latin America and the Caribbean
Carole Sanz-Paris leads the debt capital markets team at IDB Invest. She is a specialist in fixed income, structured finance transaction execution, sale-side research, and credit analysis.
She defines herself as passionate about investing with social impact. Carole has more than 20 years of experience in global capital markets; she has been responsible for the structuring, execution and placement of many complex financial structures, including securitizations.
She has published extensively on the relative value of fixed income products and credit analysis, having developed her interest in social responsibility and impact investing while earning her Executive MBA from Oxford University.
Contact: caroles@idbinvest.org