Banco Continental

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Established in 1979, Banco Continental S.A.E.C.A is the largest bank in Paraguay in terms of loan portfolio with a 19.8% market share. Among the four top tier banks in the country, BC is one of the two locally owned banks.

Over 90% of the USD 2.5 billion portfolio of the Bank is dedicated to MSMEs and large companies with limited exposure to the retail sector compared with the system average. MSMEs account for 25% of the portfolio. The loan portfolio is diversified among the most robust and driving economic sectors in Paraguay, limiting the Bank’s risk exposure to any particular industry although the high concentration of the country’s economy in primary sector is reflected: agriculture and livestock account for close to 30% of the portfolio. In terms of geographical coverage, BC has 68 full services branches (including Headquarters in Asunción). This is the largest network amongst the four biggest banks in the country.

  • Investment amount (€):

    €13,778K

  • Contract signature :

    2016

  • Nature of intervention :

    Debt

  • Development impacts :

    • 1 — Local economic growth; credit provision to MSMEs: The use of proceeds will be the funding of the organic growth of the client’s loan portfolio and BIO's loan will require specific use-of-funds clauses for on-lending to SMEs only. The loan contract will stipulate a mandatory growth in the SME portfolio of at least the amount of the loan (syndicated A-loan of USD 45 million with other DFI lenders) within the tenor of the loan (5 years).
    • 2 — Financial inclusion; access to financial services for individuals and micro-enterprises: Supporting financial inclusion for MSMEs in the country is a top priority for BIO's investment. According to a survey of the National Department of Statistics of Paraguay (2011), only 27% of small and microenterprises have access to finance (45% for medium-sized). There is room for improvement and as the bank has a significant market share in the MSME segment, it is an excellent entry point to provide indirect funding to Paraguayan MSMEs, including micro-entrepreneurs.
    • 3 — Food security and rural development: 40% of the bank's SME loan portfolio is oriented at livestock and agriculture. Therefore, as BIO's loan which will be 100% dedicated to the SME portfolio growth, it will support those sector and the rural areas which are being deserved by the extensive branch network of the client (largest banking full-services branches network in the country).
    • 4 — Promotion of ESG best practices