IDB Invest and Banco Promerica S.A., El Salvador (Banco Promerica) joined forces to issue the first Sustainability Bonds in El Salvador to finance green and social projects. BLP acted as legal advisor to IDB Invest in El Salvador during the transaction.
IDB purchased the entire first tranche of $20 million out of a $100 million five-year sustainability bond issuance program representing the first thematic bond in El Salvador’s history.
BLP assisted in structuring the issue and preparing the securities documents and the bond subscription contract. This first issuance of Sustainability Bonds in El Salvador is also the first bond sale that uses SOFR as a reference rate in the Salvadoran market.
The bond proceeds will finance new credits aimed at the social portfolio of small and medium-sized enterprises (SMEs) and companies led by women and young people, increasing access by such entities to future financing. The proceeds will also support Banco Promerica’s green portfolio, including financing renewable energy projects, clean transportation, sustainable agriculture, energy efficiency, and drip irrigation.
The BLP team leader in this transaction was partner Zygmunt Brett, accompanied by associate Jose Gochez.