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IFC and IFC ALAC Fund Invest in Guaranty Trust Bank to Demonstrate Confidence in Nigerian Banking Reforms


In Lagos:
Chijioke Nworka
Phone: +234 1 279-9408
Email: rnworka@ifc.org

In Johannesburg:
Desmond Dodd
Phone: +27 11 731 3053
Email: ddodd@ifc.org

In Washington:
Alexandra Klopfer
Phone: +1 (202) 473 4645
Email: aklopfer@ifc.org

Lagos, Nigeria, July 29, 2010— IFC, a member of the World Bank Group, and IFC Asset Management Company today announced an investment of $200 million in Guaranty Trust Bank, which demonstrates confidence in Nigerian banking reforms and increases access to finance for key sectors of the economy.  IFC is encouraged by the financial sector reform policies that have stabilized the banking sector in Nigeria and positioned it for solid expansion in the future.

GT Bank, one of Nigeria’s largest banking groups, is well positioned to realize strong profitable growth in this environment.

IFC’s investment consists of a $170 million loan and the naira equivalent of $22.5 million in GT Bank’s equity, subject to GT Bank board and shareholder approval. The IFC African, Latin American, and Caribbean Fund, which is managed by IFC Asset Management Company, will invest the naira equivalent of $7.5 million in GT Bank’s equity, subject to approval.

“The investments from IFC and the IFC ALAC Fund will provide Guaranty Trust Bank long-term funding to support its organic growth strategy, including increasing investments in infrastructure and energy,” said Segun Agbaje, Deputy Managing Director of Guaranty Trust Bank. “Partnership with IFC in sectors such as infrastructure and energy allows us to leverage their global knowledge and expertise, as well as improve our capacity in environmental and social risk management.”

IFC’s investments are part of a strategy to help strengthen Nigeria’s banking sector in the aftermath of the global financial crisis. The strategy includes: providing long-term financing to help well-managed, systemic banks improve their reach to smaller businesses and other underserved market segments; helping partner banks improve their corporate governance and risk management, as well as developing robust environmental and social monitoring systems; and supporting the Central Bank's initiatives to strengthen the overall banking sector.

Jyrki Koskelo, IFC Vice President for Global Industries, said, “By providing this valued partner with long-term funding, IFC is supporting the bank as it organically grows its diversified portfolio during this banking crisis period in Nigeria.  As GTB expands into new sectors such as infrastructure and energy, we look to help it take a market leadership role by introducing new social and environmental risk management standards in these sectors.”  

Gavin Wilson, CEO of IFC Asset Management Company added, “We are pleased to be investing alongside IFC in Guaranty Trust Bank. We believe that Guaranty Trust Bank, with its strengthened capital base, will consolidate its position as a leading player in the Nigerian banking sector for the benefit of its shareholders, clients, and the broader economy.”

 
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries. We create opportunity for people to escape poverty and improve their lives. We do so by providing financing to help businesses employ more people and supply essential services, by mobilizing capital from others, and by delivering advisory services to ensure sustainable development. In a time of global economic uncertainty, our new investments climbed to a record $18 billion in fiscal 2010. For more information, visit www.ifc.org.

About IFC Asset Management Company
IFC Asset Management Company LLC, a wholly-owned subsidiary of IFC, invests third-party capital, enabling outside investors to benefit from IFC’s expertise in achieving strong equity returns as well as positive development impact in the countries in which it invests. It manages the $3 billion IFC Capitalization Fund as well as the IFC ALAC Fund.

About the IFC African, Latin American, and Caribbean Fund
The IFC ALAC Fund is a co-investment fund that invests alongside IFC in equity investments in Sub-Saharan Africa, Latin America and the Caribbean. It provides long-term growth capital for private enterprise in these regions.