Washington, June 28, 2005 — The International
Finance Corporation, the private sector arm of the World Bank Group, recently
signed an agreement to provide FIMBank with up to $10 million in the form
of a subordinated long term convertible loan, to assist the bank expand
its operations by establishing joint-venture factoring companies in a number
of selected countries including, Argentina, Brazil, China, Russia and Dubai.
Creating this network of specialized trade finance institutions that are
geared towards the promotion of factoring as an alternate trade finance
product will help expand the provision of trade finance products in emerging
markets. These companies will specifically cater to the needs of SMEs,
especially exporters, who will use factoring to reduce the credit risk
of the buyer, while at the same time, be able to trade on an open account
FIMBank was established in Malta in 1994 and is a provider of trade related
financial services to clients in emerging markets. The Bank’s strategy
is to establish a global platform that would introduce trade finance products
(factoring and forfaiting) in emerging markets in partnership with local
banks. In line with this strategy, FIMBank acquired London Forfaiting Company
one of the leading forfaiting companies in the world, focused on
trading assets originating from emerging markets; a 38.5% shareholding
in Global Trade Finance, a factoring company based in India; and a
40% shareholding in Factors Egypt, a factoring company based in Egypt.
For the new investments FIMBank will continue its strategy of aligning
with a strong local partner while playing the role of technical partner
capitalizing on its international expertise in trade. As of December 2004,
FIMBank had over US$220 million in total assets and an equity base of over
IFC’s Director for Financial Markets, Mr. Jyrki Koskelo stated “IFC is
pleased to be working with an institution like FIMBank which is entirely
focused on enhancing trade related financial services to emerging markets.
Given Malta’s recent membership in IFC, we are looking forward to
partnering with other Maltese companies to promote the further development
of the private sector in our client countries.”
Mr. Najeeb Al-Saleh, Chairman of FIMBank, expressed his satisfaction with
establishing this partnership with IFC. IFC’s investment in FIMBank will
enable the bank to accelerate its growth in emerging markets by creating
awareness and access to trade finance products.
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in emerging markets,
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in transition and developing countries, mobilizes capital
in the international financial markets, helps clients improve social and
environmental sustainability, and provides technical assistance and advice
to governments and businesses. From its founding in 1956 through FY04,
IFC has committed more than $44 billion of its own funds and arranged $23
billion in syndications for 3,143 companies in 140 developing countries.
IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its
own account and $5.5 billion held for participants in loan syndications.