MICROCAPITAL BRIEF: International Finance Corporation (IFC) to Loan $30m to Rizal Commercial Banking Corporation (RCBC) of Philippines to Fund Small, Medium-sized Enterprises; Women-led Businesses

The International Finance Corporation (IFC), a member of the US-based World Bank Group that offers financial services to businesses and governments in developing countries with the aim of increasing economic growth, recently announced that it has approved a “medium-term loan”[1] of up to USD 30 million to the Rizal Commercial Banking Corporation (RCBC), a commercial bank in the Philippines. The aim of the loan is to help RCBC to finance small and medium-sized enterprises (SMEs) and businesses led by women. It is expected that the funding will contribute to job creation and help enable the recovery of small businesses that were affected by Typhoon Haiyan (Yolanda) in 2013.

Mr Jesse Ang, IFC’s resident representative in the Philippines, said that “with 80 percent of micro, small and medium enterprises in the Philippines not having access to credit or the collateral to borrow from a bank, IFC’s loan is designed to help provide financing to these businesses, promote job creation and diversify the country’s economic base”[1]. Mr Lorenzo Tan, RCBC’s president and chief executive officer, added that “we consider [the SME] market segment instrumental to RCBC’s lending growth and will continue to be a key focus area for the bank”[1].

As of December 31, 2013, RCBC reported total assets of PHP 421.8 billion (USD 9.3 billion), return on average assets of 1.39 percent, return on average capital funds of 12.18 percent and 6.4 million customers. IFC has 184 member countries and reported total assets of USD 77.5 billion as of fiscal year-end 2013. IFC’s advisory services team supports RCBC’s “Women in Business Program”[1] that aims to promote lending to female entrepreneurs. IFC also advises Rizal Microbank, a microfinance subsidiary of RCBC, that promotes financial access to SMEs based in the city of Mindanao and in the region of Southern Luzon.

By Alíz Crowley, Research Associate

About Rizal Commercial Banking Corporation (RCBC)

Rizal Commercial Banking Corporation (RCBC) was established in 1960 as Rizal Development Bank. In 1962, it was approved by Bangko Sentral ng Pilipinas, the central bank of the Philippines, to operate as a commercial bank and, in 1963, it began operations under its current name. With its subsidiary, RCBC Savings Bank, RCBC has approximately 440 branches in the Philippines. Additionally, RCBC is present in 24 countries through remittance offices. RCBC offers a range of financial services including corporate banking, retail banking, consumer lending, credit cards, wealth management, treasury, investment banking and remittances. RCBC owns a microfinance subsidiary, Rizal Microbank that promotes financial access to SMEs based in the city of Mindanao and in the region of Southern Luzon. As of December 31, 2013, RCBC reported total assets of PHP 421.8 billion (USD 9.3 billion), return on assets of 1.39 percent, return on average capital funds of 12.18 percent and 6.3 million customers. IFC and the IFC Capitalization Fund, an asset management operation of IFC, owns a stake of 11.34 percent in RCBC.

About International Finance Corporation

The International Finance Corporation (IFC), a US-based multilateral development bank and member of the World Bank Group, offers loans, equity investments, advisory and risk mitigation services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. IFC has 184 member countries and reported total assets of USD 77.5 billion as of fiscal year-end 2013.

Sources and Additional Resources

[1] International Finance Corporation, News, IFC Helps Improve Access to Finance for Small and Women-Led Enterprises in the Philippines

MicroCapital, October 30, 2014, International Finance Corporation (IFC) Loans $5m to KazMicroFinance (KMF) of Kazakhstan for On-Lending to Small Enterprises

MicroCapital, October 21, 2014, International Finance Corporation (IFC) Loans $15m to Eskhata Bank of Tajikistan to Fund Small, Medium-Sized Enterprises (SMEs)

MicroCapital, March 13, 2011, International Finance Corporation (IFC) Purchases $48m Equity Stake in Rizal Commercial Banking Corporation (RCBC) of Philippines Aimed At Increasing Lending to Microfinance Clients, Home Buyers, Small and Medium-Sized Enterprises (SMEs)

MicroCapital Universe Profile: Rizal Commercial Banking Corporation (RCBC)

MicroCapital Universe Profile: International Finance Corporation

Do you know that MicroCapital publishes the MicroCapital Monitor newspaper each month? Find out more at https://www.microcapital.org/products-page/

Similar Posts: