Colombo, March 1, 2007
— IFC, the private sector arm of the World Bank Group, today announced that NDB Bank has become the first bank in Sri Lanka to join its Global Trade Finance Program. The program is providing NDB Bank with an $8 million facility.
The Global Trade Finance Program supports trade with emerging markets worldwide and promotes the flow of goods and services between developing countries. IFC provides partial or full guarantees against underlying trade instruments and covers the payment risk of participating issuing banks. The program allows issuing banks, such as NDB Bank, to increase the volume and value of trade transactions, with enhanced tenors and access to competitive pricing terms.
Iyad Malas, Regional Director for IFC, South Asia, said, “The IFC Global Trade Finance Program provides risk coverage in difficult markets and combines global reach and maximum flexibility. It assists trade finance deals by delivering trade solutions through a global network of participating banks. The program complements the capacity of banks to deliver trade financing and paves the way for countries like Sri Lanka to increase their share of global trade.”
Nihal Welikala, Chief Executive Officer at NDB Bank, said, “We are delighted to extend our relationship with IFC through the Global Trade Finance Program. NDB Bank will expand its network of correspondent banks and create new and valuable business opportunities for our clients in Sri Lanka and across the world.”
Gilles Galludec, IFC’s Country Manager for Sri Lanka and Maldives said, “The Global Trade Finance Program is an important mechanism to bring on board local banks to an active global network that facilitates transactions in challenging markets, promotes competitive financing, and builds correspondent bank relationships with new institutions on a low-risk basis.” “The program is a good example of how IFC helps banks develop the sector by leveraging its vast network,” added Jeetendra Marcelline, IFC’s Head of Investments in Sri Lanka and Maldives.
IFC has had a long relationship with NDB through its group companies; in 2001, IFC invested in the equity of NDB housing. Also in the region, NDB is the project sponsor of the Maldives Finance Leasing Company, where IFC has an equity and loan exposure outstanding.
Trade development and advisory services for issuing banks represent an integral part of the Global Trade Finance Program. Technical assistance modules comprise basic and intermediate courses on trade finance. On a selective basis, IFC places experienced trade finance bankers with issuing banks to help them develop their trade finance and other banking skills.
About NDB Bank
NDB Bank was established as a government-owned bank in 1979 with additional funding from multilateral agencies. In 1993, the government divested its stake, and the bank emerged as a full-fledged commercial bank in August 2005 following its merger with its commercial banking subsidiary, NDB Bank Limited. The merger has enabled NDB Bank to offer a broader range of financial products and services rather than project finance alone. The bank’s business operations are structured under three main business lines: Corporate, Consumer, and SME. NDB provides insurance, housing finance, investment banking, and leasing activities through its group companies.
About IFC
IFC, the private sector arm of the World Bank Group, promotes open and competitive markets in developing countries. IFC supports sustainable private sector companies and other partners in generating productive jobs and delivering basic services, so that people have opportunities to escape poverty and improve their lives. Through FY06, IFC Financial Products have committed more than $56 billion in funding for private sector investments and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. IFC Advisory Services and donor partners have provided more than $1 billion in program support to build small enterprises, to accelerate private participation in infrastructure, to improve the business enabling environment, to increase access to finance, and to strengthen environmental and social sustainability. For more information, please visit
www.ifc.org
.
