BANGKOK, Dec. 8 -- The International Finance Corporation (IFC) has signed its largest financing agreement ever for a financial institution, a US$290 million package for National Finance and Securities Public Company Limited (NFS) of Thailand. The IFC package comprises a US$30 million six-year term loan and a subscription to US$10 million worth of convertible debentures for the Corporation's own account and a US$250 million syndicated three-year loan, the second-largest syndication in IFC's history. The syndication provides the longest maturity financing yet attained by NFS and is structured as a revolving facility to give the company flexibility in managing its asset/liability position. Thirty-eight banks from 17 countries are participating in the syndication. Many of the participant banks are assuming Thai exposure for the first time and are participating in an IFC loan for the first time. Together with IFC, BA Asia Limited, Société Generale Asia Limited and The Bank of Nova Scotia Asia Limited assisted in arranging the financing. The Bank of Nova Scotia Asia Limited is the Agent for the facility. NFS will use the funds for on-lending to small and medium-sized enterprises (SMEs) in Thailand, which are playing an increasingly important role in supporting major export industries such as automobiles, electronics and machinery. The project will help Thai SMEs gain access to scarce medium and long-term foreign currency funding. About 60 SMEs are expected to receive sub-loans under the project. NFS will also implement an environmental risk management system to assess and enhance the environmental practices of these companies. "The project represents a significant IFC initiative in the Asia-Pacific region by mobilizing longer term financing, which has generally not been available to Thai finance companies," according to Mr. Jemal-ud-din Kassum, Vice President of IFC. "Through this transaction, IFC is stabilizing NFS's funding base and improving its asset/liability position. The project will also help Thai SMEs modernize their facilities and enhance their competitiveness," he added. IFC is a member of the World Bank Group and is the leading multilateral source of equity and loan finance for private sector projects in developing countries.
