OPIC Provides $150 Million to Banco Industrial to Expand Access to Affordable Housing in Guatemala
December 20, 2018
WASHINGTON – The Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution, has disbursed $150 million in financing to Banco Industrial to increase mortgage lending to low- and middle-income borrowers and expand access to affordable housing in Guatemala.
Guatemala’s largest mortgage lender, Banco Industrial will use the OPIC financing to expand its portfolio of affordable home loans. The mortgages support lower-income homebuyers by requiring smaller down payments, charging lower interest rates, and providing additional flexibility during periods of unemployment, prolonged sickness, or death in the family.
In Guatemala, where an estimated 60 percent of the population lives below the poverty line, low- and middle-income populations face steep barriers to formal financial services, particularly to mortgage financing. OPIC’s loan to Banco Industrial is expected to expand lending to approximately 3,000 first-time homebuyers and help narrow Guatemala’s estimated housing deficit of 1.5 million homes.
The project will also advance OPIC’s Northern Triangle Initiative to drive $1 billion in private-sector investment to El Salvador, Guatemala, and Honduras, and promote economic growth and stability throughout the region.
“By expanding financial services to a large but underserved segment of the population, this project will help alleviate the severe shortage of affordable housing in Guatemala,” said Ryan Brennan, Vice President of OPIC’s Office of Investment Policy. “OPIC is proud to partner with Banco Industrial, a proven leader in mortgage lending, to address this pressing need and continue to support inclusive development throughout Latin America.”
OPIC has in recent months launched several initiatives to drive investment to Latin America and the Caribbean. In addition to its Northern Triangle Initiative, OPIC’s 2X Americas Initiative will mobilize $500 million in capital to projects that support the region’s women.
The Overseas Private Investment Corporation (OPIC) is a self-sustaining U.S. Government agency that helps American businesses invest in emerging markets. Established in 1971, OPIC provides businesses with the tools to manage the risks associated with foreign direct investment, fosters economic development in emerging market countries, and advances U.S. foreign policy and national security priorities. OPIC helps American businesses gain footholds in new markets, catalyzes new revenues and contributes to jobs and growth opportunities both at home and abroad. OPIC fulfills its mission by providing businesses with financing, political risk insurance, advocacy and by partnering with private equity fund managers.
OPIC services are available to new and expanding businesses planning to invest in more than 160 countries worldwide. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers. All OPIC projects must adhere to best international practices and cannot cause job loss in the United States.