IFC, Others Invest $175m in Ecobank Group
- By Simeon Ogoegbulem
- Published July 5th, 2010
- News
- Unrated
The International Finance Corporation (IFC), a member of the World Bank Group and IFC Asset Management Company, has announced a series of investments totalling $175 million (about N26.25 billion) in Ecobank Transnational Incorporated and its group subsidiaries. The investment would 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. The fund consists of $56.4 million senior convertible loan and a $75 million senior non-convertible loan from IFC Capitalization Fund, funded by IFC and the Japan Bank for International Cooperation and managed by IFC Asset Management Company. It also includes $18.8 million senior convertible loan in ETI by the IFC African, Latin American, and Caribbean Fund, managed by IFC Asset Management Company.
Other components of the investment include a subordinated loan of $12.5 million from IFC to Ecobank Kenya, another subordinated loan of $3 million from IFC to Ecobank Liberia as well as local currency denominated loans to Ecobank subsidiaries in Cameroon, Central African Republic, and Chad totalling 10 billion CFA ($9.4 million equivalent) using proceeds from the IFC CFA Bond issue in Central Africa.
Arnold Ekpe, chief executive officer of the Ecobank Group, said the investments from IFC, IFC Capitalization Fund and IFC ALAC Fund will strengthen Ecobank’s capital base and enable it to continue to consolidate its expanded operations and translate its new scale and footprint into value for her customers. Ekpe further stated that Ecobank will use the financing to maintain credit provision in Africa’s most challenging economies.”
Lars Thunell, IFC executive vice president, 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.”
Gavin Wilson, chief executive officer of the IFC Asset Management Company, 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.”
IFC’s relationship with Ecobank started 17 years ago with an investment in Ecobank Ghana. Since then, IFC has invested in a number of the group’s subsidiaries, as well as in the group’s holding company in 1999 and 2008. IFC has also supported improvements in the group’s governance structure and social and environmental standards. The banking group is one of IFC’s most important clients in Sub-Saharan Africa.
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. The fund consists of $56.4 million senior convertible loan and a $75 million senior non-convertible loan from IFC Capitalization Fund, funded by IFC and the Japan Bank for International Cooperation and managed by IFC Asset Management Company. It also includes $18.8 million senior convertible loan in ETI by the IFC African, Latin American, and Caribbean Fund, managed by IFC Asset Management Company.
Other components of the investment include a subordinated loan of $12.5 million from IFC to Ecobank Kenya, another subordinated loan of $3 million from IFC to Ecobank Liberia as well as local currency denominated loans to Ecobank subsidiaries in Cameroon, Central African Republic, and Chad totalling 10 billion CFA ($9.4 million equivalent) using proceeds from the IFC CFA Bond issue in Central Africa.
Arnold Ekpe, chief executive officer of the Ecobank Group, said the investments from IFC, IFC Capitalization Fund and IFC ALAC Fund will strengthen Ecobank’s capital base and enable it to continue to consolidate its expanded operations and translate its new scale and footprint into value for her customers. Ekpe further stated that Ecobank will use the financing to maintain credit provision in Africa’s most challenging economies.”
Lars Thunell, IFC executive vice president, 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.”
Gavin Wilson, chief executive officer of the IFC Asset Management Company, 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.”
IFC’s relationship with Ecobank started 17 years ago with an investment in Ecobank Ghana. Since then, IFC has invested in a number of the group’s subsidiaries, as well as in the group’s holding company in 1999 and 2008. IFC has also supported improvements in the group’s governance structure and social and environmental standards. The banking group is one of IFC’s most important clients in Sub-Saharan Africa.
