The Nigerian unit of pan-African lender Ecobank said on Monday it has secured $150 million in a debt facility from a group of international banks to grow its loan book.
“The facility marks Ecobank’s debut in the international loan market and lays the groundwork for future fundraising on a broader basis,” the bank said.
UK’s Standard Chartered Bank, Germany’s Commerzbank, UAE’s Mashreq and First Gulf Bank PJSC, are the participating banks in the loan, which is Ecobank says is a one-year facility.
Last month, Export credit agency, United Kingdom Export Finance (UKEF), listed Ecobank Nigeria as the only Nigerian financial institution among 20 others it will partner with to help provide a £3 billion ($4.8 billion) Direct Lending facility (DCF) to exporters in the UK.
By leveraging the DLF, UKEF can provide loans to buyers outside of the UK to finance the purchase of goods and services from UK exporters; this is very similar to the role played by Export-Import Banks and other export credit agencies. The partnering firms have explained in a statement that the loans will cover international sales by any business exporting from the UK to any country where the UKEF medium term cover is available. And such loans can be made available in US Dollars, Euro, Sterling or Japanese Yen.
Apart from Ecobank Nigeria, other partnering financial institutions include Citibank, Barclays Bank Group, Bank of China, JPMorgan Chase Bank Group, The Royal Bank of Scotland among others.
Ecobank Nigeria Managing Director, Mr Jibril Aku welcomed the appointment with optimism saying it was a validation of the bank’s track record in international trading. “This international recognition is a great feat. It is a great privilege to have been selected alongside other global brands. This will help to enlist more local companies importing British goods,” he said.
As a reward for partnering with the UKEF, the institutions can negotiate fees from borrowers directly thus generating a new revenue stream and, potentially, new businesses.
