By Stanley Opara

Tuesday, 30 Nov 2010

International Finance Corporation, a member of the World Bank Group, has announced a $70m investment in First City Monument Bank Plc to support the bank‘s growth strategy and help it increase financing of small and medium enterprises.

IFC‘s investment would consist of a long-term senior loan of $50m and a convertible loan of $20m, FCMB said in a statement on Monday.

FCMB and IFC also signed a cooperation agreement outlining areas for future partnership. They include acquisition finance of a distressed bank, co-financing on infrastructure projects, potential co-investment in an infrastructure project development investment company, and partnership in introducing new classes of assets to the pension industry.

The Group Managing Director, First City Monument Bank, Mr. Ladi Balogun, was quoted as saying that, ”This partnership with IFC will help First City Monument Bank achieve our strategic growth objectives. We view IFC‘s investment as a stamp-of-approval on our strategy and commitment to good corporate governance and risk management.”

IFC‘s Country Manager for Nigeria, Mr. Solomon Adegbie-Quaynor, said, ”IFC is committed to supporting the full recovery of Nigeria‘s banking system, and our investment in FCMB reflects this strategy. IFC is particularly well positioned to support growth by well-managed banks and the expansion of their SME lending business.”

This transaction is part of IFC‘s ongoing strategy to support the banking sector in Nigeria and across emerging markets in the aftermath of recent market turmoil by providing long-term financing to help well-managed banks achieve growth objectives and improving their reach to underserved segments, such as infrastructure and SMEs.

Source: Punch