OPIC and Liberty Mutual Insurance Launch $1 Billion Agreement to Catalyze Private Sector Investment in the Developing World
November 8, 2018
- New and innovative co-investment platform is a historic first for OPIC
- Liberty Agreement advances OPIC’s financing capacity by de-risking projects that deliver consistent financial returns and achieve important development goals
BOSTON - Today, the Overseas Private Investment Corporation (OPIC), the U.S. government’s development finance institution, and Liberty Mutual Insurance announce the launch of a $1 billion risk-sharing agreement to facilitate private sector investment in the world’s most challenging markets.
This new and innovative co-investment platform is a major milestone in OPIC’s efforts to mobilize private capital to advance the U.S. Government’s development finance goals through investments that drive economic growth, build critical infrastructure, and empower women throughout the developing world. This is OPIC’s first agreement with a U.S. owned insurance company to share credit risk across a global portfolio of new OPIC-originated loans to commercial banks and other non-bank financial institutions.
“Today’s launch of its first co-investing platform is an important day for OPIC and development finance,” said David Bohigian, EVP, OPIC. “This billion dollar platform is a significant milestone in creating innovative approaches to catalyzing private sector capital to meet global challenges. Partnering with Liberty Mutual, a U.S. owned insurance company recognized as a global leader in providing risk solutions, demonstrates that working with OPIC balances risk and return while having a positive impact on the lives of the people who need it the most. Today’s announcement continues OPIC’s tradition of innovation and demonstrates the creativity and execution that forms the foundation of next year’s US International Development Finance Corporation.”
For Liberty Mutual Insurance the partnership with OPIC is part of a larger strategic initiative aimed at developing long term partnerships with international development institutions that can bring significant diversification to its credit insurance portfolio and access to new markets.
“Liberty Mutual is fully committed to providing effective credit and political risk insurance products globally,” notes Peter Sprent, Head of Financial Risk Solutions, Liberty Specialty Markets. “Partnering with public agencies like the Overseas Private Investment Corporation, is an important way for us to approach this market. We benefit from OPIC’s high standards of due diligence – including environmental and worker rights safeguards – and credit monitoring.
“We were able to demonstrate to OPIC our leadership in this space following agreements recently concluded with other development finance institutions.”
In conjunction with the launch of this co-investment platform, over $235 million of funding is being deployed to several financial institutions operating in Central & South America and Africa underscoring OPIC’s strong interest to quickly achieve the intended objectives. These funds will provide benefits to hundreds of women-owned businesses and SMEs.
OPIC’s experts will originate, underwrite and monitor creditworthiness and developmental impact – including labor, human rights, social, gender, and environmental impact - throughout the life of the projects and Liberty will take a significant risk interest in those loans that are part of the facility. Over time, this will allow OPIC to do more business and have a greater impact, particularly in those important markets where development is most needed.
OPIC is the U.S. Government’s development finance institution. It mobilizes private capital to help address critical development challenges and in doing so, advances U.S. foreign policy and national security priorities. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets, catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, political risk insurance, and support for private equity investment funds, when commercial funding cannot be obtained elsewhere. Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers.
All OPIC projects adhere to high environmental and social standards and respect human rights, including worker's rights. By mandating high standards, OPIC aims to raise the industry and regional standards of the countries where it funds projects. OPIC services are available for new and expanding business enterprises in more than 160 countries worldwide.
About Liberty Specialty Markets
Liberty Specialty Markets offers specialty and commercial insurance and reinsurance products across key UK, European, Middle East, US and other international locations. We provide brokers and insureds with a broad product range through both the Company and Lloyd’s markets and have approximately 1,700 employees in approximately 65 offices.
You can learn more by visiting Libertyspecialtymarkets.com.
About Liberty Mutual Insurance
Liberty Mutual is the 5th largest global property and casualty insurer based on 2017 gross written premium, with over 50,000 employees in 30 countries and economies around the world. Our purpose is to help people embrace today and confidently pursue tomorrow. The promise we make to our customers throughout the world is to provide protection for the unexpected, delivered with care. We achieve this by offering a full range of personal, commercial, and specialty Property & Casualty insurance coverages. Our customers’ trust has earned us the 68th spot on the Fortune 100 list of largest corporations in the U.S., based on 2017 revenue. You can learn more about us by visiting Libertymutualgroup.com.