Harare Bureau
FBC Bank has secured a $60 million three-year term syndicated loan facility jointly arranged by Standard Chartered Bank and its partners to support trade, manufacturing and key projects in the economy. The facility carries a comprehensive guarantee from African Export-Import Bank and was jointly arranged by Standard Chartered Bank and partners, namely Commerzbank Aktiengesellschaft and Investec Asset Management Proprietary Limited.

The loan, for which Standard Chartered and Afreximbank were also joint co-coordinators, will support projects in regional trade, manufacturing, telecommunications, education and power generation. Webster Rusere, managing director of FBC Bank said; “This syndication will not only support FBC’s successful business strategy in Zimbabwe, but also enable us to deliver tangible benefits and make a difference in the lives of individual Zimbabweans.”

Rusere added that effective management of capital was essential for the well-being of the economy, and the transaction was a good example of how banks can come together to create positive and holistic solutions for multiple organisations and institutions.

Specific entities set to benefit include the National University of Science and Technology, which is establishing the country’s first DNA testing laboratory; Tel-One’s scaling up and development of the company’s telecommunications infrastructure and Zimbabwe Power Company’s purchase of spares and equipment to support power generation at the Hwange Thermal Power Station.

Afreximbank president Jean Louis Ekra said with the transaction, the regional development finance bank had contributed in boosting domestic liquidity to promote economic growth.

“With the continuing effort by Zimbabwe to address the tight systemic liquidity challenges confronting it, this syndication strengthens the capacity of the country’s trade finance banks to continue their role of financing trade,” Ekra said in a statement. Financial syndications are valuable commercial collaborations, which increase the total value of finance available to institutions, while effectively managing or spreading risk for syndicated partners.

Standard Chartered Bank Zimbabwe chief executive, Ralph Wantungwa said; “Standard Chartered remains committed to using its strengths and capital to benefit and support the local economy.”

He added that the facility represented yet another example of “our promise to be here for good and facilitate transactions, which generate positive outcomes for many generations to come.” Further, Wantugwa said, over the last 12 months, Standard Chartered had delivered over $300 million worth of support to key growth sectors of Zimbabwe’s economy, including agriculture, trade, commodities and others, a 20 percent growth on 2012.”

Funding facilities of this type could go a long way in improving the tight liquidity situation in the economy due to weak export performance, low industrial productivity, negligible foreign direct investment and limited access to lines of credit from foreign institutions.

It is believed that as Africa’s development demands increase with its growth potential, syndicated loans provided a holistic solution for stakeholders to support its large scale funding needs.

You Might Also Like

Comments