IFC, which is part of the World Bank Group, said that the financing has the ability to help contribute to both the housing sector and the wider economy, specifically for its links to the cement, iron, and insurance industries.
The Washington-based financial institution noted that mortgages only represent 7% of GDP in Colombia, a lower rate than in many other Latin American countries.
“Housing ownership levels in Colombia are among the lowest in Latin America, and the country has an estimated housing deficit of about 3.5 million units,” said IFC in a statement. It added that “the loan will allow BBVA Colombia to strengthen the dynamics of growth in mortgage loans, which will play a fundamental role in boosting the development of the housing sector in Colombia.”
BBVA Colombia is a subsidiary of Spanish banking giant BBVA Group, which has previously partnered with IFC in other debt investment and financing facilities through its Latin American arms in Chile, Argentina, Peru, and Paraguay as well as past efforts in Colombia.
“Colombia still has a way to go to provide quality housing to more Colombians, and thus to contribute to improving the quality of life and reducing poverty,” said the Óscar Cabrera Izquierdo, executive president of BBVA Colombia. “This is how BBVA understood it, and that is why we are decidedly supporting this sector. We are always looking to finance housing projects.”
BBVA Colombia branch in Bogotá, Colombia. (Credit: Jared Wade)