The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) OECS MSME Guarantee Facility Project (P157715) LATIN AMERICA AND CARIBBEAN | OECS Countries | IBRD/IDA | Investment Project Financing (IPF) | FY 2019 | Seq No: 13 | Archived on 24-Jan-2025 | ISR02656 Implementing Agencies: Eastern Caribbean Partial Credit Guarantee Corporation 1. OBJECTIVE 1.1 Development Objective Original Development Objective (Approved as part of Approval package on 20-Aug-2020) The development objective is to facilitate additional financial intermediation for MSMEs by supporting the establishment of a regional partial guarantee corporation. Has the Development Objective been changed since Board Approval of the Project Objective? No 2. COMPONENTS Name Capitalize the Partial Credit Guarantee Fund:(Cost 8,100,000.00) Project Management, Operating Costs and Lender Training:(Cost 1,900,000.00) 3. OVERALL RATINGS Name Previous Current Progress towards achievement of PDO Moderately Satisfactory Moderately Satisfactory Overall Implementation Progress (IP) Moderately Satisfactory Moderately Satisfactory Overall Risk Rating Substantial Substantial 4. KEY ISSUES & STATUS 4.1 Implementation Status and Key Decisions Jan 24, 2025 Page 1 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) The Eastern Caribbean Partial Credit Guarantee Corporation (ECPCGC has gained momentum in guaranteeing Micro, Small, and Medium Enterprises (MSME) loans in 2023 and 2024 due to key operational and policy actions, coupled with banks engaging more in lending, post-exit of Canadian banks in 2019 and with the economic recoveries after the height of COVID-19. To date, the project has facilitated over $6.5 million in loans to entrepreneurs who would otherwise else likely not have received a loan. This effort has also fostered banks' increased engagement in MSME lending outside of the project, as banks become more engaged with MSMEs. It is believed these results will be sustainable over the long-term given the guaranteed loans (and non-guaranteed loans) are increasingly in demand by banks and entrepreneurs, and increased guaranteed loan demand has fostered more financial sustainability for the ECPCGC through the small guarantee fee it charges. To maintain results, it is also important that the ECPCGC continues to work on its internal policies to improve it’s performance. 5. SYSTEMATIC OPERATIONS RISK-RATING TOOL Rating at Approval Last Approved Rating Risk Category Approval Package - ISR Seq. 012 - 28 Jun Proposed Rating 20 Aug 2020 2024 Political and Governance Moderate Moderate Moderate Macroeconomic High High High Sector Strategies and Policies Moderate Substantial Substantial Technical Design of Project or Program Substantial Substantial Substantial Institutional Capacity for Implementation and Substantial Moderate Moderate Sustainability Fiduciary Substantial Moderate Moderate Environment and Social Substantial Moderate Moderate Stakeholders Low Low Low Overall Substantial Substantial Substantial Jan 24, 2025 Page 2 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) 6. RESULTS 6.1 PDO Indicators by PDO Outcomes Establishment of a regional partial guarantee corporation Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year 0.00 Jul/2018 106.00 24-Jun-2024 138.00 20-Jan-2025 250.00 Feb/2025 Comments on This will be calculated as the cumulative number of guaranteed loans issued by the Number of Guaranteed Loans achieving targets Corporation. Given the current momentum of the number of guaranteed loans issued based (Number) on increased demand, it is feasible that the end-target of 250 loans will be achieved by the end of the ISR period. 0.00 Jul/2018 5,342,218.52 24-Jun-2024 6,547,544.44 20-Jan-2025 12,000,000.00 Feb/2025 Comments on This is the total amount of guarantees approved during the project in US dollars to lenders in achieving targets all participating countries. The exchange rate between the US dollar and the EC dollar is pegged, so there is no foreign exchange translation adjustment required. As with the Total amount of outstanding number of loans, total approved guarantees will be tracked along with those that are guaranteed loans through expired or cancelled to provide a cumulative approved amount. The total approved amount Project (Amount(USD)) will provide a gauge of the amount of work accomplished by the Corporation and will be used to calculate the indicator. Given the current momentum of the number of guaranteed loans issued based on increased demand, it is feasible that end-target value of guaranteed loans ($12 million) will be achieved by the end of the ISR period. Number of loan officers 0.00 Jul/2018 386 12-Jun-2024 386 31-Dec-2024 45.00 Feb/2025 trained in MSME credit assessment (Number) 6.2 Intermediate Results Indicators by Components Jan 24, 2025 Page 3 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) Capitalize the Partial Credit Guarantee Fund Baseline Actual (Previous) Actual (Current) Closing Period Indicator Name Value Month/Year Value Date Value Date Value Month/Year Number of MSMEs receiving 0.00 Jul/2018 94 24-Jun-2024 115 31-Dec-2024 250.00 Feb/2025 guaranteed loans through Project (Number) 0.00 Jul/2018 45.70 24-Jun-2024 54 31-Dec-2024 30.00 Feb/2025 Share of guarantees issued to Comments on This indicator captures the share of MSMEs receiving a guarantee with at least one female women owned or managed achieving targets owner, as a number of the guarantees thus far include co-ownership by both men and MSMEs (Percentage) women. Percentage of funding 0.00 Jul/2018 100.00 24-Jun-2024 100.00 16-Dec-2024 70.00 Feb/2025 through guaranteed loans with maturity more than one year (Percentage) The ratio of equity to 0.00 Jul/2018 0.36 24-Jun-2024 0.50 31-Dec-2024 1.00 Feb/2025 outstanding guarantees (Number) 0.00 Jul/2018 0.00 24-Jun-2024 0.00 31-Dec-2024 5.00 Feb/2025 Comments on This is defined as the amount of net losses on disbursed guarantees due to default. This is achieving targets calculated post recovery of the guaranteed loan. The financial model uses a 6 percent Proportion of guarantees default rate and a 30 percent recovery rate which results in a 4.2 percent net loss rate. The paid-out (Percentage) numerator of this indicator is the cumulative amount across all participating countries in EC dollars of net losses since the beginning of operations, and the denominator is the cumulative amount across all participating countries of guarantees issued in EC dollars including those guarantees that are expired or cancelled. Percentage of beneficiaries 0.00 Jul/2018 95.20 30-Sep-2023 95.20 30-Sep-2023 75.00 Feb/2025 that feel project activities Comments on Percentage of beneficiaries (MSMEs and Participating Financial Institutions) that feel project reflected their needs (Citizen achieving targets activities reflected their needs is defined by those who are either extremely satisfied and Jan 24, 2025 Page 4 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) Engagement Indicator) those who are satisfied. 60 of 63 of MSMEs and Participating Financial Institutions indicated (Percentage) they were either extremely satisfied or satisfied. 3 respondents noted they were dissatisfied and 2 noted they were extremely dissatisfied. Jan 24, 2025 Page 5 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) 7. DATA ON FINANCIAL PERFORMANCE 7.1 Cumulative Disbursements 7.2 Disbursements (by loan) Loan/Credit/TF Status Original Revised Cancelled Disbursed Undisbursed % Disbursed IDA-62650 Effective 2.00 2.00 0.00 2.00 0.00 100.00 % IBRD-88830 Effective 2.00 2.00 0.00 2.00 0.00 100.00 % IDA-62670 Effective 2.00 1.84 0.00 1.96 0.00 100.00 % IDA-62660 Effective 2.00 2.00 0.00 2.00 0.00 100.00 % Jan 24, 2025 Page 6 of 7 The World Bank Implementation Status & Results Report OECS MSME Guarantee Facility Project (P157715) IDA-62640 Effective 2.00 2.00 0.00 2.00 0.00 100.00 % 7.3 Key Dates (by loan) Loan/Credit/TF Status Approval Signing Effectiveness Orig. Closing Rev. Closing IBRD-88830 Effective 05-Jul-2018 28-Sep-2018 12-Jul-2019 30-Jun-2023 28-Feb-2025 IDA-62640 Effective 05-Jul-2018 28-Sep-2018 12-Jul-2019 30-Jun-2023 28-Feb-2025 IDA-62650 Effective 05-Jul-2018 28-Sep-2018 12-Jul-2019 30-Jun-2023 28-Feb-2025 IDA-62660 Effective 05-Jul-2018 21-Sep-2018 12-Jul-2019 30-Jun-2023 28-Feb-2025 IDA-62670 Effective 05-Jul-2018 22-Sep-2018 12-Jul-2019 30-Jun-2023 28-Feb-2025 8. KEY DATES Key Events Planned Actual Approval 05-Jul-2018 05-Jul-2018 Effectiveness 12-Jul-2019 12-Jul-2019 Mid-Term Review No. 01 21-Jun-2022 21-Jun-2022 Operation Closing/Cancellation 28-Feb-2025 9. RESTRUCTURING HISTORY Restructuring Level 2 Approved on 21-Sep-2022 10. ASSOCIATED OPERATION(S) There are no associated operations Jan 24, 2025 Page 7 of 7