CRDB secures $130 million for credit to private sector, SMEs
From left: CRDB Bank Group’s CEO, Mr Abdulmajid Nsekela, head of Africa structured debt solutions at Investec Bank, Mr Rowan King, the director of loan syndication at Intesa Sanpaolo, Mr Gustaaf Eerenstein and head of international banking at Bank One Limited, Mr Carl Chirwa sign documents in Dar es Salaam yesterday. PHOTO|COURTESY
What you need to know:
- The sum will be spent on lending to corportate and SMEs in Tanzania and Burundi in a move showing confidence on the lender
Dar es Salaam. South Africa-based Investec Bank and Italian Intesa Sanpaolo have raised $130 million in syndicated term loan facility for CRDB Bank’s lending to corporate and SME sectors in Tanzania and Burundi, the companies announced yesterday.
“The capital raised will be used to unlock working capital for the corporate and SME sector in the East African countries, including project and infrastructure finance linked to the commodity sector,” the companies said in a statement yesterday.
Intesa and Investec were joint coordinators and book runners for the transaction with Investec also acting as the facility agent for this maiden syndicated loan deal in Tanzania outside the government and public sector.
“We’re very excited to have closed this agreement. The raised funds from international market will improve the bank’s overall capitalisation and support our lending portfolio to corporate and SME sector in Tanzania and Burundi,” CRDB Bank Group CEO Abdulmajid Nsekela said in the statement.
He said the target was to raise $50 million but the high number of international investors showing interest, the deal ended up raising a total of $130 million.
CRDB Bank has B2 stable outlook rating by Moody`s Investors Services.
“CRDB Bank continues to explore business opportunities in strategic sectors that will bring the much needed development to boost the country’s economy. This fund will help us boost our lending activities and further strengthen our leadership position,” he added.
The head of Africa structured debt solutions at Investec Bank, Mr Rowan King, said the transaction was a vote of confidence by global financial institutions in CRDB and the Tanzania economy. “Tanzania has proved to be crucial part of the African growth story over the last few years,” he said.
Besides, he said, many of the key commodities produced in East, Southern and Central Africa are exported through Tanzanian ports. “In the light of demand for the key commodities that Africa produces, the country is playing an ever more important role in inter-African trade -opening the region to Middle Eastern and Asian markets from both an import and export perspective,” he said.
The head of Loan Distribution and Syndication at Investec Bank, Leanne Large said the fact that the $130 million raised was two-and-a-half times the launch amount, points to the fact that there is a high degree of comfort in CRDB Bank’s creditworthiness, which, coupled with a broad spread of investors in the facility, demonstrates a healthy interest in the placement.
