MIGA Backs Sustainable Finance in Mexico in Largest Transaction Ever

WASHINGTON, December 5, 2023 – The Multilateral Investment Guarantee Agency of the World Bank (MIGA) issued a guarantee of $1.85 billion to HSBC Holdings plc of the United Kingdom (HSBC) which will provide regulatory capital relief for its subsidiary in Mexico.

MIGA’s capital optimization guarantee to HSBC will generate risk weighted assets headroom, the benefits of which are expected to be deployed in Mexico exclusively toward eligible climate finance sub-projects through HSBC’s subsidiary HSBC Mexico S.A., Institución de Banca Múltiple, Grupo Financiero HSBC (HSBC Mexico). HSBC Mexico's climate finance investments are likely to cover a broad range of sectors that includes renewable energy, energy efficiency, clean transportation and sustainable agriculture.

“This project is MIGA’s largest transaction to date and will support financing of climate-related projects in Mexico. This will help HSBC Mexico to scale up its sustainable finance loan portfolio,” said Hiroshi Matano, MIGA Executive Vice President. “The capital optimization guarantee showcases MIGA’s effort to provide much-needed capital to emerging markets.”

“We are pleased to be entering into this transaction, the first of its kind for HSBC and largest for MIGA. This partnership will complement our Net Zero strategy,” said Jorge Arce, HSBC Mexico CEO. “We have an ambition to play a key role with our clients in Mexico helping to mobilize capital to support sustainable projects and help support the transition to a greener economy.”

Mexico is an upper middle-income country, with the 14th-largest economy by gross domestic product. The country has a low credit penetration. In 2022, domestic credit to the private sector was reported at 35.6 percent of GDP, compared to 57.1 percent in Latin America and the Caribbean.

About MIGA

MIGA was created in 1988 as a member of the World Bank to promote foreign direct investment in emerging economies by helping to mitigate the risks of restrictions on currency conversion and transfer, breach of contract by governments, expropriation, and war and civil disturbance; and offering credit enhancement to private investors and lenders. Since its creation, MIGA has issued over $76 billion in guarantees across 123 developing countries, supporting more than 1,000 projects. Over the past decade, MIGA’s guarantees have generated more than 156,000 jobs in developing countries.

About HSBC

HSBC Holdings plc, the parent company of HSBC, is headquartered in London. HSBC serves customers worldwide from offices in 62 countries and territories. With assets of $3.021 billion as of September 30, 2023, HSBC is one of the world’s largest banking and financial services organizations.

Contact:

In Washington: 

Elizabeth Howton, (202) 458-5922 or ehowton@worldbankgroup.org

For more information, please visit: https://www.miga.org 

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