Costa Rica is moving forward with the issuance of thematic bonds, as IDB Invest, Banco Nacional de Costa Rica (BNCR) and FinDev Canada joined forces to issue the country’s first social bond, which aims to finance the development of micro, small and medium-sized enterprises (MSMEs).

IDB Invest was the structurer of these $75 million subordinated social bonds, which were issued by Banco Nacional. The issuance consists of two series, one of $45 million by IDB Invest and the other of $30 million by FinDev Canada.

This transaction will serve to inject secondary capital to the National Bank in order to provide credit facilities to MSMEs so they can access financing to help them boost their businesses, which will dynamize the Costa Rican economy.

It is important to note that at least 40% of the funds of the issue will be directed to provide financial resources to MSMEs led or created by women.

The BNCR received advice from IDB Invest to design the methodological framework for the use of proceeds, which specifies the criteria for the selection, monitoring and evaluation of projects based on the principles of social bonds of the International Capital Markets Association (ICMA).

For this issuance, the BNCR obtained an independent verification of the methodological framework for the use of proceeds, an exercise known as a second party opinion, which was conducted by the external consulting firm V.E.
FinDev Canada accompanied the National Bank in creating a strategic gender plan. Both entities used the Women’s Empowerment Principles (WEPs) tool to conduct a gender gap diagnosis.

Since 2018, the Bolsa Nacional de Valores has taken the lead in committing different public and private institutions in the Costa Rican financial sector to sign up to the WEPs, so that companies can implement measures that contribute to gender equality through internal actions, as well as in the market and the community. In 2019, BN Fondos, a company that is part of the Banco Nacional Conglomerate, became a signatory of the WEPs.