FirstRand Limited MRPA

Africa Financial services

Our investment

In 2016, CDC and First Rand Bank signed a $100 million risk participation arrangement to increase the availability of trade finance in developing countries across sub-Saharan Africa.

Expected impact

Trade finance supports the supply chain of many industries and is key to the success of any developing economy. Since the global financial crisis, growing businesses in Africa have struggled to access the finance they need from local banks to help them expand and reach international markets.

Our arrangement with FirstRand aims to boost the availability of trade finance in some of Africa’s poorest countries. This is expected to generate over $500 million of additional trade each year, supporting job creation, boosting exports and enabling regional economic growth.

The agreement will support local banks in sub-Saharan Africa (excluding South Africa) to offer trade finance products to their business clients. These products, such as letters of credit for import and export, and documents against payment, are crucial to businesses that rely on trade for growth and job creation.

Environmental and social aspects

CDC approaches trade finance transactions through the application of its exclusion list, which prohibits trade in certain industry sectors, or trades that create unacceptable impacts. We actively monitor trades to ensure this requirement is met.

Key facts

Status:
Active
Region

Since 2012, we’ve only invested in Africa and South Asia. Investments outside these regions are from our pre-2012 portfolio.

:
Africa
Sector

We have seven priority sectors. However, we continue to invest outside these sectors, largely in the most challenging regions, as new investment supporting any sector helps to underpin the private sector, and create jobs and livelihoods for people.

:
Financial services
Website:
https://www.firstrand.co.za/Pages/Firstrand.aspx
Investment type

We provide capital in three broad ways: direct equity, debt, and intermediated equity (principally through investment funds).

:
Trade finance
Start date

For direct investments, this is the date CDC committed capital to the business or project.

For funds, this is the date that CDC committed capital to the fund.

For underlying fund investments, this is the date that the fund invested capital into the business.e

:
December 2016
Amount

For direct investments, this is the total amount that CDC has committed to the business or project (it may be a combination of equity and debt).

For funds, this is the total amount that CDC has committed to the fund.

:
$100m
Domicile

This is the investee company’s place of incorporation; or a fund’s jurisdiction.

:
South Africa