Press Release

IFC, Global Bank to Increase Housing Finance for Women, Support Women-Owned SMEs in Panama

Panama City, October 20, 2020.- IFC, the private sector arm of the World Bank Group, is partnering with Panama’s Global Bank in a first-of-its-kind transaction that will increase housing finance for women and support women-owned businesses in the country. Panama is Latin America’s fastest growing economy, yet only seven percent of adult women in the country have a housing loan, and only 7 percent of women-owned businesses have funding from financial institutions. As a result, Panama’s gender gap is higher than the average in Latin America and the Caribbean. The $70 million loan to Global Bank is IFC’s first investment focused on housing for women. It will increase Global Bank’s portfolio of mortgages for women, especially for low- to middle-income households headed by women. Part of the package will also be aimed at funding women-owned small and medium enterprises (WSMEs) through IFC’s Banking on Women business. “Global Bank will become the first IFC partner globally to offer mortgage solutions targeted specifically towards women,” said Georgina Baker, IFC Vice President for Latin America and the Caribbean, Europe and Central Asia. “Despite having many positive characteristics as banking clients, women-owned businesses have had less access to loans, often because they lack the real estate collateral that financial institutions require. our pioneering and innovative partnership with global bank will help address this challenge,” Baker added. With one of the largest and most stable financial sectors in the region, Panama and this leading financial institution will serve as an innovation hub to test solutions that Latin America and other emerging markets can replicate to increase access to finance for underserved segments, a pillar of IFC’s strategy. In Panama, around 80 percent of the demand is now for preferential interest housing. “There has been growing interest for housing projects that qualify for preferential interest rates, and there is a need to adjust the supply,” said Jorge Vallarino, CEO of Global Bank. “We have been steadily growing our mortgage portfolio, with almost half of it focused on low- and middle-income families,” Vallarino added. An IFC report on women’s access to home ownership, “Her Home – Housing Finance for Women,” found that home ownership is not only critical to improving living conditions, but to accessing formal credit and establishing a credit history over time. The study also found that gender asset gaps in property possession undermine women’s ability to engage in economic activity and reveals that there is large unmet demand for housing finance from women-headed households, particularly in developing countries. Around the world, IFC’s gender and housing specialists work with financial institutions in identifying business opportunities to establish gender business lines, primarily dedicated to this underserved segment, following best-in-class gender-focused international practices.

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