Risk Management
Enterprise Risk Management
CIFI’s Enterprise Risk Management (ERM) framework is a continuous step-by-step process designed to enhance decision-making. It helps identify, measure, monitor, control, mitigate, and communicate risks tied to activities, roles, processes, projects, products, or assets. By managing risks in line with the company’s size and complexity, the framework enables CIFI to strike the right balance between risk and capital, ensuring stability and efficiency.
To effectively implement this framework, CIFI relies on a robust governance structure. Various committee charters, along with laws, regulations, best practices, the Shareholders’ Agreement, and corporate governance principles, provide the foundation. An independent Board of Directors’ Risk Committee oversees the process, approving strategic decisions and key policies while ensuring that the Executive Team allocates the necessary resources to support the ERM framework.
CIFI’s ERM framework identifies, assesses, and monitors a wide range of risks to ensure the resilience and sustainability of its operations and investments. CIFI’s proactive risk management approach ensures informed decision-making, regulatory compliance, and long-term value creation for all stakeholders.
Credit Risk
Risk of borrower default, leading to potential loss of principal, interest, and increased collection costs.
Country Risk
Risks arising from economic, political, or social instability, including natural disasters in countries where CIFI or its clients operate.
Liquidity Risk
The risk of being unable to meet short-term financial obligations due to limited cash or asset convertibility.
Market Risk
Exposure to losses from market fluctuations, including Pricing Risk. Interest Rate Risk and Foreign Exchange Risk.
Operational Risk
Losses from failed internal processes, systems, or external events.
Information Technology Risk
Risks from system failures, cyber threats, or unauthorized access.
Credit Approval Process
CIFI’s structured approach to risk management not only strengthens internal controls but also serves as a critical foundation for its credit approval process. Every transaction is evaluated through a disciplined, multi-step pipeline that integrates risk considerations from origination to credit supervision. This ensures that credits align with CIFI’s strategic objectives, uphold environmental and social standards, and deliver sustainable value across the region.
BUSINESS DEVELOPMENT
The Business Development team actively sources investment opportunities that align with CIFI's criteria. This involves building relationships, attending sector-specific events, and leveraging advisors, partners, and industry networks.
ELIGIBILITY COMMITTEE
Initial project assessment, evaluating key risks, sponsor experience, debt sizing, ESG factors, Know Your Client (KYC) compliance, and preliminary pricing. This stage serves as the first approval checkpoint.
DUE DILIGENCE
Comprehensive evaluation using in-house expertise, proprietary tools and external advisors. Covers financial, technical, legal, environmental, social, insurance and market aspects to assess the project’s strengths and risks.
CREDIT COMMITTEE
Second and final approval stage, where a team of experts, including independent members with extensive experience in infrastructure, conducts a thorough review of the transaction.
LEGAL DOCUMENTATION & DISBURSEMENT
CIFI, the borrower, and legal advisors jointly draft and negotiate contract terms to ensure a robust credit structure and risk mitigation throughout the investment lifecycle. Upon fulfillment of all conditions precedent, a closing checklist is executed, and the disbursement is formally authorized.
CREDIT SUPERVISION
Dedicated Portfolio and ESG officers monitor contractual obligations, rating assessments, as well as financial, technical, environmental and social performance.