5 November 2020

CDC announces additional US$100 million commitment to risk sharing facility with SMBC Bank International plc

  • Injects systemic liquidity into CDC’s Africa markets
  • Forms a key part of CDC’s response to COVID-19
  • Supports trade in the food, agriculture and healthcare sectors

CDC Group, the UK’s development finance institution and impact investor, has today announced a US$100 million additional commitment to its existing trade risk sharing facility with SMBC Bank International plc (SMBC BI). This investment will help maintain access for consumers to a range of goods and services by facilitating commodity imports. The facility will also sustain economic opportunities by supporting imports of goods required by manufacturing businesses.

The new commitment builds on an existing US$100 million trade finance facility with SMBC BI, enhancing CDC’s total trade commitment with the bank to US$200 million. The commitment marks a significant increase in the bank’s capacity to support trade in CDC’s markets across Africa. The new facility will provide up to US$200 million of liquidity to directly support trade lines to local banks, thereby protecting vital trade and jobs, sustaining economic activity. This financing will help accelerate the economic recovery from the COVID-19 pandemic.

CDC’s support comes at a time when global market disruptions have led to major liquidity challenges for banks and businesses, exacerbating the existing pressures on trade finance availability. The countercyclical commitments by Development Finance Institutions such as CDC are critical to closing the trade finance gap, particularly at a time when businesses face growing needs.

CDC’s commitment additionally features an innovative mechanism to incentivise trades involving the food, agriculture and healthcare sectors, as well as transactions in CDC’s priority countries. This forms part of CDC’s mission of responding to the COVID-19 pandemic by supporting supply chains that underpin basic human needs.

Admir Imami, Director, Head of Trade & Supply Chain Finance, CDC:

This new investment reinforces our longstanding partnership with SMBC BI and deepens our commitment to preserving trade across Africa. The facility will provide liquidity to markets and sectors that need it most, thereby cushioning the impact of the pandemic on businesses and supply chains that rely on imports.”

Nisrin Abouelezz, Managing Director, Head of Africa Group, SMBC BI : “CDC’s additional US$100 million commitment to our longstanding facility is a major step in helping us scale the trade finance lines we provide to local banks. Our partnership with CDC will help mitigate the humanitarian aspects of the COVID-19 crisis by focusing on food security and healthcare.”

 

Media Contact:

CDC: Clare Murray / M. +44 (0) 7887 993 356 / press@cdcgroup.com

Notes to Editors

About CDC

  1. CDC Group is the UK’s first impact investor with over 70 years of experience of successfully supporting the sustainable, long-term growth of businesses in South Asia and Africa.
  2. CDC is a leading player in the fight against climate change and a UK champion of the UN’s Sustainable Development Goals – the global blueprint to achieve a better and more sustainable future for us all.
  3. The company has investments in over 1,200 businesses in emerging economies and a total portfolio value of £5.8bn. This year CDC will invest over $1.5bn in companies in Africa and Asia with a focus on fighting climate change, empowering women and creating new jobs and opportunities for millions of people.
  4. CDC is funded by the UK government and all proceeds from its investments are reinvested to improve the lives of millions of people in Africa and South Asia.
  5. CDC’s expertise makes it the perfect partner for private investors looking to devote capital to making a measurable environmental and social impact in countries most in need of investment.

 

About SMBC BI

SMBC Bank International plc (SMBC BI) is headquartered in London with a branch in Paris and is a wholly owned subsidiary of Sumitomo Mitsui Banking Corporation (SMBC). It was established in March 2003 as Sumitomo Mitsui Banking Corporation Europe Limited (SMBCE) and changed its name and re-registered as a public limited company in 2020. It carries out the majority of its activities in Europe, the Middle East and Africa.