Washington, D.C., July 17, 2012 –
IFC Asset Management Company today announced a $100 million investment
in Ecobank Transnational Incorporated (ETI) which will help ETI strengthen
its capital base, scale up in key markets, and expand its offerings across
its network of 32 African countries, many of which are fragile and conflict-affected
states.
ETI is the parent company of the leading
independent pan-African banking group and provides wholesale, retail,
investment, and transaction banking services and products to governments,
financial institutions, multinationals, international organizations, medium,
small, and micro businesses, and individuals. ETI’s large presence makes
it an ideal partner to address development challenges in Africa, unlocking
the economic potential of some of the world’s poorest countries. ETI has
already been instrumental in IFC’s Africa MSME Program, providing much
needed support for the growth of small businesses across the continent.
Three funds managed by IFC Asset Management
Company—the IFC Capitalization Fund (IFC Cap Fund), the IFC African, Latin
American, and Caribbean Fund (IFC ALAC Fund), and the Africa Capitalization
Fund—will invest up to $100 million in a subscription of ETI shares, for
a combined stake of about 7.2 percent. IFC Asset Management Company is
a wholly-owned subsidiary of IFC, a member of the World Bank Group. This
investment comes as part of a successful fundraising program by ETI, which
has also attracted large institutional investors, such as Nedbank and Public
Investment Corporation of South Africa.
IFC and ETI have worked together since
1993 to increase access to finance, improve trade liquidity, and strengthen
the banking sector in Africa. As part of this relationship, IFC has provided
a range of advisory services to help ETI expand its microfinance, small
and medium finance, and mortgage finance businesses. In 2009, IFC became
a shareholder in ETI following the conversion of a $100 million loan into
an equity stake of 9.2 percent. This is the second time IFC Asset Management
Company funds have made investments in ETI. In June 2010, IFC Cap Fund
and IFC ALAC Fund committed $150 million in loans, with half the amount
convertible into equity.
“Our relationship with ETI continues
to grow and this transaction is a crucial step in IFC’s strategy of improving
access to finance in Sub-Saharan Africa,” said Rashad Kaldany, IFC Acting
CEO and Executive Vice President. “It will enable ETI to increase lending
to underserved market segments, such as agribusiness, micro, small, and
medium enterprises, and climate change. It will also promote trade and
integration, and generate employment where it is needed most.”
Gavin E.R. Wilson, CEO of IFC Asset
Management Company, said: “We are pleased to increase our shareholding
in what we consider to be one of Africa's most impressive banks. ETI has
built a unique platform across 32 countries in what is a fast growing but
relatively underbanked region. This provides our investors with an opportunity
to benefit from the region's strong growth prospects, as well as the continued
consolidation of ETI’s market position."
As previously announced in December
2011, Thierry Tanoh, former IFC Vice President for Latin America and the
Caribbean, Sub-Saharan Africa, and Western Europe, has become CEO-designate
of Ecobank effective July 16, 2012. In line with best practices, Mr. Tanoh
followed all World Bank Group policies regarding his move to an IFC client
organization.
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 help developing countries achieve sustainable
growth by financing investment, providing advisory services to businesses
and governments, and mobilizing capital in the international financial
markets. In fiscal 2011, amid economic uncertainty across the globe, we
helped our clients create jobs, strengthen environmental performance, and
contribute to their local communities—all while driving our investments
to an all-time high of nearly $19 billion. 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, founded by IFC and the
Japan Bank for International Cooperation; the $1 billion IFC African, Latin
American, and Caribbean Fund; and the $182 million Africa Capitalization
Fund, whose investors are Abu Dhabi Fund for Development, African Development
Bank, CDC Group plc, European Investment Bank, OPEC Fund for International
Development, and Sumitomo Mitsui Banking Corporation.
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