Nairobi, February 13, 2009—IFC,
a member of the World Bank Group, has entered into a US$5 million
(395 million Kenyan shillings) trade financing guarantee agreement with
Diamond Trust Bank Kenya (DTB) to help boost Kenya’s share of global trade,
the two organizations announced today.
IFC’s guarantee will enable DTB to
increase the trade finance instruments it issues to finance imports to
Kenya, which will support the country’s private sector and promote economic
“This collaboration will enable DTB
Kenya to increase its trade finance activities, helping more local companies
grow and compete in the international marketplace,” said DTB Group Chairman
IFC’s global trade finance program
promotes trade with emerging markets worldwide by supporting flows of goods
and services to and from developing countries. Through the program, IFC
provides guarantee coverage of bank risk in emerging markets, allowing
recipients to expand their trade finance transactions within an extensive
network of countries and banks and to enhance their trade finance coverage.
“Increased trade in Africa is important
to supporting the region's continued economic growth and development,"
said IFC Executive Vice President and CEO Lars Thunell. “Promoting trade
is an important part of IFC's strategy to support the private sector amid
the current global economic and financial turmoil,” Thunell added.
This is the second time in less than
a year that IFC has partnered with DTB Kenya. Last year, IFC made
available a 2 billion Kenyan shilling (Ksh) financing package to DTB to
support the bank’s expansion plans and to help it increase lending to
small and medium enterprises.
DTB plans to increase its branch network
from the current 30 to 100 in the next three years. This year alone, the
group plans to open nearly 20 new branches in the region.
DTB Uganda also plans to increase its
domestic network during 2009, and began branching out outside the capital,
Kampala, in 2008.
“We will also be establishing a new
banking subsidiary in Burundi in the next two months or so, and we are
exploring the establishment of banking operations in other parts of Eastern
and Southern Africa over the next three to four years including Madagascar,
Mozambique, DRC and Rwanda,” said Manji.
IFC has been a shareholder in DTB since
1983 and currently holds a 9.85 percent stake in the bank.
IFC, a member of the World Bank Group,
creates opportunity for people to escape poverty and improve their lives.
We foster sustainable economic growth in developing countries by supporting
private sector development, mobilizing private capital, and providing advisory
and risk mitigation services to businesses and governments. Our new investments
totaled $16.2 billion in fiscal 2008, a 34 percent increase over the previous
year. For more information, visit www.ifc.org.
DTB Kenya is an affiliate of the Aga
Khan Fund for Economic Development (AKFED), the economic development arm
of the Aga Khan Development Network. Amongst the bank's key shareholders
are Habib Bank Limited (HBL), an AKFED subsidiary, and the International
Finance Corporation, the private sector lending arm of the World Bank.