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A deal arranged by a Japanese bank has brought additional commercial financial support to the African commercial stock market …
A deal organized by a The Japanese bank has provided additional commercial financial support to the African Commerce Bank.
Japanese bank Mitsubishi UFL Financial Group (MUFG) and the African Export-Import Bank (Afreximbank) has secured the closing of a 520 million dollar credit line on December 3.
MUFG acted as sole lead organizer, book broker and agent on the deal. Cairo-based Afreximbank said the agreement was in line with its support for trade and investment, export manufacturing and industrialization in Africa, key sectors to maximize the continent’s economic potential. It will use the proceeds from the mechanism to support its Pandemic Trade Impact Mitigation Mechanism (PATIMFA), established in March to support states, banks and businesses during the coronavirus pandemic, particularly in relation to trade.
“This installation marks a watershed moment for African institutions looking to tap into the pool of Japanese investors,” said MUFG’s director of emerging markets for Europe, Middle East and Africa. Christopher Marksand the deal has attracted new Japanese investors to the African bank.
Marks praised Afreximbank for “not only leading the way in terms of bringing new investment and growth opportunities to Africa, but also providing vital support to the region in the face of the Covid-19 pandemic.”
The facility was closed with the support of the Japanese state insurer Nippon Export and Investment Insurance (NEXI), which insisted on the participation of the African bank and that the facility contribute to the United Nations Sustainable Development Goals.
NEXI’s participation was coordinated by MUFG and inspired by the Tokyo International Conference on African Development, whose seventh edition took place in 2019.
Amr kamel, Executive Vice President of Business Development and Corporate Banking for Afreximbank, commented: “The successful implementation of this facility is a testament to the great collaboration and innovative approach adopted by MUFG, NEXI and Afreximbank and demonstrates the power of using public resources to leverage the private financing for development. “
He added: “We expect strong and sustainable development results through the effective implementation of this mechanism, including job creation, increased economic activities and increased tax revenue for governments with fiscal stress, among other results.”
MUFG’s previous activity in Africa has included acting for the Eastern and Southern Africa Trade and Development Bank in a 2017 bond financing.
Last past month, Afreximbank established a new fund to meet trade and export financing needs, particularly for small and medium-sized enterprises, in Africa. November also saw the bank associated with the International Islamic Trade Finance Corporation and Arab Bank for Economic Development in Africa to establish a line of credit to address supply problems caused for the Covid-19 pandemic.
In October, Afreximbank advised on the sale of BNP Paribassubsidiaries in Guinea and Burkina Faso. Benedict Oramah was reelected as president of the bank in June.
