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IFC Partners with Absa Bank to Boost Trade Finance in Sub-Saharan Africa

11/17/2021 | 02:57am EST

Johannesburg, South Africa, November 17, 2021-IFC today welcomed Absa Bank Ltd. to its Global Trade Liquidity Program (GTLP) to boost access to trade finance in sub-Saharan Africa, especially in low income and fragile countries, supporting a vital driver of growth that has been strained by the COVID-19 pandemic.

Through a combined investment of $250 million, IFC and Absa Bank, one of Africa's largest financial institutions, will channel credit to a portfolio of trade transactions that is expected to facilitate up to $1.6 billion in trade over the next three years. The financing will support Absa's commitment to increase the accessibility of trade finance, with around 80 percent of financing expected to go to low income and fragile countries.

Under the GTLP risk-sharing model, IFC will guarantee a pool of eligible trade transactions issued by Absa Bank by up to 50 percent, with the remaining amount being guaranteed by Absa Bank.

"Absa is delighted to announce the signing of a $250 million facility under IFC's GTLP program," said Bohani Hlungwane, Managing Principal - Head of Trade & Working Capital Sales (Pan Africa) at Absa. "This program builds on our existing relationship with IFC, further solidifying our commitment to providing access to trade finance and closing the trade finance gap on the African continent."

"The partnership with Absa will play a key role in the response to and recovery from the COVID-19 pandemic by supporting trade finance that is essential for economic recovery and growth in sub-Saharan African markets," said Manuel Reyes-Retana, IFC's Regional Industry Director for the Financial Institutions Group in Africa. "GTLP provides much-needed trade financing, helping banks to increase their credit limits, manage risk and support small and medium sized businesses in challenging emerging markets."

IFC's GTLP program was established to provide financing to partner banks, helping them minimize risk in trade financing and facilitate increased trade in emerging markets, especially for underserved importers and exporters and small businesses.

Since its launch in 2009, the GTLP program has supported more than $75 billion in global trade volume via nearly 27,000 transactions, of which more than $24 billion has represented trade in low-income countries.

About IFC

IFC-a member of the World Bank Group-is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2021, IFC committed a record $31.5 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of the COVID-19 pandemic. For more information, visit www.ifc.org.

About Absa

Absa Bank is a subsidiary of Absa Group Limited (Absa Group), which is listed on the Johannesburg Stock Exchange and is one of Africa's largest diversified financial services groups. Absa Group offers an integrated set of products and services across personal and business banking, corporate and investment banking, wealth and investment management and insurance. The Group's registered head office is in Johannesburg, South Africa, and it owns majority stakes in banks in Botswana, Ghana, Kenya, Mauritius, Mozambique, Seychelles, South Africa (Absa Bank), Tanzania (Absa Bank Tanzania and National Bank of Commerce), Uganda and Zambia. The Group also has representative offices in Namibia and Nigeria, as well as insurance operations in Botswana, Kenya, Mozambique, South Africa, Tanzania and Zambia, and an International Representative Office in London and New York. For more, visit our website www.absa.africa

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IFC - International Finance Corporation published this content on 16 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 17 November 2021 07:56:01 UTC.

ę Publicnow 2021
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