MICROCAPITAL BRIEF: European Investment Bank (EIB) Loans $11m to Banco Ademi for On-Lending to MSMEs in Dominican Republic; $139m to Caribbean Governments for Climate Finance, Energy Projects

The European Investment Bank (EIB), the long-term lending institution of the European Union (EU), recently has pledged to loan EUR 10 million (USD 10.8 million) to Banco Ademi, a banking institution in the Dominican Republic, for on-lending to micro-, small and medium-sized enterprises (MSMEs) in the country. Banco Ademi, which has partnered with US-based nonprofit Accion since 2006, was formerly known as Association for the Development of Microenterprise (Ademi).

Additionally, EIB pledged to loan USD 100 million to the Dominican Republic for the refurbishment of the country’s electricity system and EUR 8 million (USD 8.65 million) to St Maarten, an island nation within the Netherlands Antilles, for the improvement of internet access on the island. EIB also committed to provide USD 30.3 million to the Caribbean Development Bank (CDB), a regional development finance institution, by March 2016. The funds, which are part of a previously approved credit line, will be on-lent by CDB for projects that are resilient to climate change in the Caribbean region.

As of 2014, EIB reported total assets of EUR 542 billion (USD 596 billion) and a loan portfolio of EUR 494 million (USD 542 million). Banco Ademi reported total assets of USD 361 million, a gross loan portfolio of USD 266 million, total deposits of USD 210 million, return on assets of 4.5 percent and return on equity of 25 percent as of December 31, 2014. In 2014 CDB provided a total amount of USD 270 million in loans, grants, equity investments and guarantees to its 12 member countries.

By Alíz Crowley, Research Associate

About Banco Ademi

The Association for the Development of Microenterprise “ADEMI” (Banco Ademi) is a banking institution in the Dominican Republic that offers specialized financial services for micro-, small and medium-sized enterprises (MSMEs). The institution was established as a nonprofit by local businessmen in 1983. In 1999 Banco Ademi was transformed into a development bank. Since 2006 Banco Ademi has cooperated with Accion, a US-based nonprofit organization, with the aim of modernizing the organization’s credit operations practices and designing new financial products. Banco Ademi reported total assets of USD 361 million, a gross loan portfolio of USD 266 million, total deposits of USD 210 million, return on assets of 4.5 percent and return on equity of 25 percent as of December 31, 2014. The institution had approximately 214,000 active borrowers and 210,000 depositors in 2014.

About Caribbean Development Bank (CDB)

The Caribbean Development Bank (CDB) is a regional development finance institution that was established in 1970 with initial capital of USD 50 million. CDB aims to contribute to economic growth, economic cooperation, integration and social development in the Caribbean region. The headquarters of CDB are located in Wildey, St Michael, Barbados. The members of CDB include Barbados, Grenada, Guyana, Haiti, Jamaica, Montserrat, St Kitts and Nevis, St Lucia, St Vincent and the Grenadines, Suriname, the Bahamas, and Trinidad and Tobago. In 2014 CDB provided a total amount of USD 270 million in loans, grants, equity investments and guarantees to its 12 member countries.

About European Investment Bank (EIB)

The European Investment Bank (EIB) was created in 1958 and serves as the long-term lending bank of the European Union (EU) as of 2014. In addition to supporting projects in EU member states, its main priorities include financing investments in likely future member states and EU partner countries, principally in the area of small and medium-sized enterprises. According to its website, “the EIB operates on a non-profit maximizing basis and lends at close to the cost of borrowing.” As of 2014, EIB reported total assets of EUR 542 billion (USD 596 billion) and a loan portfolio of EUR 494 million (USD 542 million).

Sources and Additional Resources

[1] FinChannel.com, EIB confirms commitment for crucial climate, communication, energy and microfinance investment across the Caribbean

[2] MNIAlive.com, European Investment Bank & Caribbean Development Bank To Work on Energy & Climate Change Issues

[3] Accion, Our Impact, Banco Ademi

[4] Caribbean Development Bank (CDB), About CDB

[5] Caribbean Development Bank (CDB), Annual Report 2014

MicroCapital Universe Profile: Banco Ademi

MicroCapital Universe Profile: Caribbean Development Bank (CDB)

MicroCapital Universe Profile: European Investment Bank (EIB)

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