By Abdulfatah Babatunde
African Development Bank (AfDB) has granted $148 million in financial support to the Commercial International Bank (CIB) of Egypt to prop up small and medium-sized enterprises (SMEs) and trade.
In a statement received by TheNewsZenith on Friday, AfDB said the financial package “comes amid a shortage of foreign currency in Egypt due to complex endogenous and exogenous macro-economic and geopolitical factors.
Under the package, there are four loan instruments with tenors ranging from 3.5 years and 10 years, all totalling $148 million.
These are $10 million Line of credit with a tenor of 10 years and $90 million subordinated loan with a tenor of 10 years.
The other two are a $32 million trade finance line of credit with a tenor of 3.5 years and a $16 million trade finance line of credit from the Africa Growing Together Fund (AGTF) with a tenor of 3.5 years.
AfDB stated that the financial package to CIB “comes amid a shortage of foreign currency in Egypt”.
It attributes the shortage to complex endogenous and exogenous macroeconomic and geopolitical factors.
Such factors, it added, include persistent supply bottlenecks due to the COVID-19 pandemic and the Russia-Ukraine conflict.
The Continental Finance House added that the package would enable CIB to meet the foreign currency needs of its clients in various sectors.
The bank listed three specifying main objectives of the packages.
These include providing CIB with long-term resources for onward lending to businesses.
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It would also strengthen CIB’s capital position and enable it to meet the trade finance needs of its clients.
“The primary beneficiaries of the financial package will be small and medium-sized enterprises (SMEs) and corporate organisations, operating in key sectors of the Egyptian economy.
AfDB expected that the funding would contribute to mobilising significant resources for key economic sectors in Egypt.
This will ultimately enhance productive capacity and stimulate growth.
It would also increase economic output, improve the country’s competitiveness, and generate fiscal and export revenues.
Further, the funding would create much-needed employment opportunities, particularly for women.
CIB is one of Egypt’s leading private sector banks, leveraging a network of 215 branches and banking units. It has a workforce of 7,689 employees and a portfolio of over 1.9 million clients.
The bank provides banking services to retail clients, SMEs and corporates. It also operates representative offices in Dubai and Addis Ababa.
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