Lagos, Nigeria, July 29, 2010
—IFC, a member of the World Bank Group, is increasing support to major financial institutions in Nigeria as part of a broader strategy to strengthen the country’s banks in the aftermath of the global financial crisis.
Underscoring this commitment, IFC Vice President for Global Industries Jyrki Koskelo announced new agreements with Guaranty Trust Bank and First Bank of Nigeria, expected to be the first in a series of transactions supporting the sector.
IFC is providing $200 million in long term funding to GTB, subject to GTB board and shareholder approval and$100 million in convertible sub-debt and senior loans to FBN with participation from IFC Asset Management Company in the equity-based financing.
“IFC is stepping up its support for the financial sector in Nigeria to help local banks grow more and contribute to private sector development,” said Koskelo. “In the wake of a crisis, Nigeria has made significant progress toward creating a policy environment in which good banks can thrive. This is the right moment for IFC and private investors to work with banks best positioned to realize growth profitably.”
IFC is committed to partnerships in Nigeria that help encourage a growing banking sector through a coordinated crisis response. IFC’s financial sector strategy includes:
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Providing long-term financing to help well-managed systemic banks, such as GTB and FBN, to achieve growth objectives within the constraints of the banking crisis, improving their reach to underserved segments such as infrastructure and smaller businesses.
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Helping partner banks improve corporate governance, risk management, and develop robust environmental and social monitoring systems
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Supporting the Central Bank’s initiatives to strengthen the banking sector
Koskelo’s itinerary in Nigeria includes meetings that also encourage IFC activities in other sectors He participated in an infrastructure roundtable and is scheduled to meet with Minister of Finance Segun Aganga and Central Bank Governor Sanusi Lamido Sanusui on Tuesday.
IFC in Nigeria
IFC’s strategy in Nigeria focuses on proactively increasing investments and advisory services to promote the real sectors of the economy, with a focus on infrastructure and agribusiness, supporting financial sector reforms and helping increasing access to finance by providing new products and services to banks, and increasing advisory services to help improve the country’s overall investment climate.
Nigeria is IFC’s second-largest portfolio in Africa, after South Africa. In the fiscal year ended June 2010, IFC committed $704 million in Nigeria. Since its first investment in Nigeria in 1964 and as of June 30, 2009, IFC has committed financing to more than 70 projects in Nigeria, amounting to $3billion. For more information, visit
www.ifc.org/africa
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About IFC
IFC, a member of the World Bank Group is the largest development institution focused on the private sector in developing countries. We create opportunity for people to escape poverty and improve their lives—by providing financing to help businesses employ more people and provide essential services, mobilizing capital from others, and delivering advisory and risk-management services to ensure sustainable development. In a time of global economic uncertainty, our new investments climbed to a record $18 billion in fiscal 2010. For more information, visit
www.ifc.org
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About IFC Asset Management Company
IFC Asset Management Company LLC, a wholly-owned subsidiary of IFC, invests third-party capital, enabling outside investors to benefit from IFC’s expertise in achieving strong equity returns as well as positive development impact in the countries in which it invests. It manages the $3 billion IFC Capitalization Fund as well as the IFC African, Latin American, and Caribbean Fund.
