Second-Party Opinion Download

Sustainalytics is of the opinion that the Banco Compartamos Social Bond Framework is credible and impactful and aligns with the four core components of the Social Bond Principles 2023. This assessment is based on the following: 

USE OF PROCEEDS

The eligible categories for the use of proceeds – Employment Generation, Socioeconomic Advancement and Empowerment, and Access to Essential Services – are aligned with those recognized by the Social Bond Principles. Sustainalytics considers that the eligible categories will lead to positive social impacts and advance the UN Sustainable Development Goals, specifically SDGs 5, 8 and 10. 

PROJECT EVALUATION AND SELECTION

Banco Compartamos’ Directors Committee and Finance Committee will be in charge of evaluating and selecting Eligible Assets and ensuring compliance with the Framework. Banco Compartamos’ Risk Committee is responsible for assessing social risks in relation to all allocation decisions made under the Framework, while individual loan officers are responsible for assessing potential environmental risks. Sustainalytics considers these social and environmental risk management systems to be adequate and the selection process to aligned with market practice. 

MANAGEMENT OF PROCEEDS

Banco Compartamos’ Executive Committee and Finance Department will oversee the allocation process to ensure that proceeds are fully allocated to eligible loans. An equal amount to the net proceeds of the Social Bonds will be allocated to the portfolio of eligible loans. The Bank will track proceeds using an internal tracking system. The Bank intends to fully allocate the proceeds to the eligible assets portfolio immediately after the issuance. The Bank has committed to ensuring continuous allocation of the proceeds to eligible loans. This is in line with market practice. 

REPORTING

Banco Compartamos intends to publish, until full allocation, an Annual Social Bond Report on its website. The allocation reporting will include amounts allocated to each eligible asset, a brief description of selected assets and the outstanding amount of net proceeds yet to be allocated to assets at the end of the reporting period. In addition, the Bank is committed to reporting on relevant impact metrics, where feasible, such as number of beneficiaries, number of first-time loan recipients, number of micro and small business benefited, and number of women-owned business benefited. Sustainalytics views Banco Compartamos’ allocation and impact reporting commitments as aligned with market practice.