Pact Will Support Small Businesses in Latin American Countries

OPIC approves $350 million lending agreement to aid housing construction

The U.S. Overseas Private Investment Corporation (OPIC) has approved $350 million in financing that will allow National City Bank to expand its lending in emerging markets, with a focus on facilitating housing construction loans in the signatory nations of the U.S.-Central American-Dominican Republic Free Trade Agreement (CAFTA), according to a press release issued May 10 by OPIC.

OPIC is an agency of the U.S. government that helps foster economic development in emerging markets, in part by working with the U.S. private sector to help U.S. businesses invest overseas and manage risks associated with foreign direct investment.

Of the $350 million in financing that OPIC will extend to National City Bank as part of a lending framework agreement, 60 percent will support small and medium-sized businesses and residential mortgages in Latin America, and in Central and Eastern Europe. About $100 million will be used for housing construction loans for low- and middle-income housing construction loans, with a special emphasis on the CAFTA countries, OPIC said. The CAFTA countries are El Salvador, Costa Rica, the Dominican Republic, Guatemala, Honduras and Nicaragua.

OPIC President Robert Mosbacher Jr. applauded the framework agreement, particularly the emphasis on CAFTA countries.

"This new framework with National City will enable OPIC to mobilize capital to finance the expansion of existing businesses and the creation of new ones, which will, in turn, generate thousands of jobs in emerging markets," he said. "Its emphasis on housing construction in CAFTA countries, in particular, will result in the provision of much-needed credit for a sector vital to the region's economic growth."

National City Bank Senior Vice President of International Markets and Financial Institutions George Fowler expressed his company's appreciation for the framework agreement.

"Every National City employee involved in these lending facilities feels a sense of fulfillment when we help to bring private home ownership in Central America," he said.

Source: U.S. Department of State

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