Colombo, March 1, 2007 — IFC, the
private sector arm of the World Bank Group, today announced that NDB Bank
has become the first bank in Sri Lanka to join its Global Trade Finance
Program. The program is providing NDB Bank with an $8 million facility.
The Global Trade Finance Program supports
trade with emerging markets worldwide and promotes the flow of goods and
services between developing countries. IFC provides partial or full
guarantees against underlying trade instruments and covers the payment
risk of participating issuing banks. The program allows issuing banks,
such as NDB Bank, to increase the volume and value of trade transactions,
with enhanced tenors and access to competitive pricing terms.
Iyad Malas, Regional Director for IFC,
South Asia, said, “The IFC Global Trade Finance Program provides risk
coverage in difficult markets and combines global reach and maximum flexibility.
It assists trade finance deals by delivering trade solutions through a
global network of participating banks. The program complements the capacity
of banks to deliver trade financing and paves the way for countries like
Sri Lanka to increase their share of global trade.”
Nihal Welikala, Chief Executive Officer
at NDB Bank, said, “We are delighted to extend our relationship with IFC
through the Global Trade Finance Program. NDB Bank will expand its
network of correspondent banks and create new and valuable business opportunities
for our clients in Sri Lanka and across the world.”
Gilles Galludec, IFC’s Country Manager
for Sri Lanka and Maldives said, “The Global Trade Finance Program is
an important mechanism to bring on board local banks to an active global
network that facilitates transactions in challenging markets, promotes
competitive financing, and builds correspondent bank relationships with
new institutions on a low-risk basis.” “The program is a good example
of how IFC helps banks develop the sector by leveraging its vast network,”
added Jeetendra Marcelline, IFC’s Head of Investments in Sri Lanka and
IFC has had a long relationship with
NDB through its group companies; in 2001, IFC invested in the equity of
NDB housing. Also in the region, NDB is the project sponsor of the Maldives
Finance Leasing Company, where IFC has an equity and loan exposure outstanding.
Trade development and advisory services
for issuing banks represent an integral part of the Global Trade Finance
Program. Technical assistance modules comprise basic and intermediate courses
on trade finance. On a selective basis, IFC places experienced trade finance
bankers with issuing banks to help them develop their trade finance and
other banking skills.
About NDB Bank
NDB Bank was established as a government-owned
bank in 1979 with additional funding from multilateral agencies. In 1993,
the government divested its stake, and the bank emerged as a full-fledged
commercial bank in August 2005 following its merger with its commercial
banking subsidiary, NDB Bank Limited. The merger has enabled NDB Bank to
offer a broader range of financial products and services rather than project
finance alone. The bank’s business operations are structured under three
main business lines: Corporate, Consumer, and SME. NDB provides insurance,
housing finance, investment banking, and leasing activities through its
IFC, the private sector arm of the World
Bank Group, promotes open and competitive markets in developing countries.
IFC supports sustainable private sector companies and other partners in
generating productive jobs and delivering basic services, so that people
have opportunities to escape poverty and improve their lives. Through FY06,
IFC Financial Products have committed more than $56 billion in funding
for private sector investments and mobilized an additional $25 billion
in syndications for 3,531 companies in 140 developing countries. IFC Advisory
Services and donor partners have provided more than $1 billion in program
support to build small enterprises, to accelerate private participation
in infrastructure, to improve the business enabling environment, to increase
access to finance, and to strengthen environmental and social sustainability.
For more information, please visit www.ifc.org.