By Emele Onu, 07.04.2010 

 

The International Finance Corporation (IFC), a member of the World Bank Group, and IFC Asset Management Company have announced a total investment of $175 million in Ecobank Transnational Incorporated and its group subsidiaries.

 

 

This investment according to a statement from IFC, will help strengthen the financial sector across several African countries and support the region’s recovery from the impact of the recent turmoil in global financial markets.Ecobank Transnational Incorporated is a leading Pan-African bank, with subsidiaries in more countries in the region than any other bank. Its subsidiaries are major contributors to economic activity in some of the world’s poorest countries. 

 

 

“By providing capital to a regionally systemic financial institution, the investments will strengthen the banking sector and ease access to credit for underserved segments of the market, such as small and medium enterprises,” IFC said.The investments totalling $175 million consist of:  A $131.4 million investment consisting of a $56.4 million  convertible loan and a $75 million senior non-convertible loan from IFC Capitalisation Fund, funded by IFC and the Japan Bank for International Cooperation and managed by IFC Asset Management Company, in ETI, the banking group’s Togo-based holding company.

 

 

It also consists of $18.8 million senior convertible loan in ETI by the IFC African, Latin American, and Caribbean Fund, managed by IFC Asset Management Company;  A subordinated loan of $12.5 million from IFC to Ecobank Kenya;  A subordinated loan of $3 million from IFC to Ecobank Liberia;  Local currency denominated loans to Ecobank subsidiaries in Cameroon, Central African Republic and Chad totalling 10 billion CFA ($9.4million equivalent) using proceeds from the IFC CFA Bond issue in Central Africa.

 

 

CEO of the Ecobank Group, Arnold Ekpe,  said: “The investments from IFC, IFC Capitalisation Fund, and IFC ALAC Fund will strengthen Ecobank’s capital base and enable us to continue to consolidate our expanded operations and translate our new scale and footprint into value for our customers.Ecobank will use the financing to maintain credit provision in Africa’s most challenging economies.”

 

 

IFC Executive Vice President and CEO, Lars Thunell,  said: “Ecobank and IFC share a strong commitment to supporting sustainable economic growth in Africa by building inclusive financial markets. IFC looks forward to strengthening our strategic partnership with Ecobank to bring financial services to people and places that need them the most.”

 

 

The CEO of the IFC Asset Management Company, Gavin Wilson,  said: “Ecobank is a champion of African growth. We are pleased to be investing in the next phase of its success and to be supporting the positive impact it has on the markets it serves.”

 

 (Source:ThisDay)