Johannesburg, South Africa, June 30,
2011 – IFC, a member of the World Bank Group, is mobilizing an equivalent
of up to 50 million Euros in South African Rand financing for Mercantile
Bank to help it increase its lending to smaller businesses, including financing
energy efficient and renewable energy projects to reduce CO2 emissions
and energy costs.
The investment consists of a loan of
up to €48.4
million from IFC’s own account and a second loan of up to €1.6
million from the World Bank-administered Clean Technology Fund. The investment
will help South African SMEs more easily obtain the funds they need to
grow, supporting the long-term development of the sector. IFC’s financing
in South African Rand will reduce risk for the smaller businesses by enabling
access to long-term local currency funding
to spur economic development.
Dave Brown, CEO of Mercantile Bank said,
“This partnership funding will enhance our capacity to grow our presence
in supporting the development of private business in South Africa and open
up opportunities to finance energy efficient projects"
Thierry Tanoh, IFC’s Vice President
for Sub-Saharan Africa, said, “IFC’s investment in Mercantile Bank highlights
our ongoing commitment to the small and medium-sized business sector in
South Africa and across the continent. Our partnership with Mercantile
Bank will help more enterprising Africans to obtain loans to expand their
operations and to finance energy efficient projects.”
Supporting the growth of small and medium
sized enterprises is a top strategic priority of IFC’s work in Africa,
where smaller businesses employ the bulk of the working population but
often struggle to obtain long-term financing.
The investment in Mercantile will also
support South Africa’s efforts to reduce its CO2 emissions, by making
funds available to businesses seeking to adapt renewable energy or more
energy efficient technologies.
In fiscal year 2010, more than $1.64
billion of IFC’s global investments went to finance renewable energy,
energy efficiency, and other climate related business, up from $1.03 billion
in fiscal year 2009.
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