Nairobi, July 18, 2024 –IFC and Citi have announced a $65 million equivalent Kenyan shillings finance facility to expand IFC's ability to provide local currency financing in Kenya.
Under the facility, Citi will provide IFC with access to Kenyan shillings that IFC will on-lend to a project to expand digital infrastructure in the country.
This is the first such facility that IFC and Citi are signing globally and Citi's first long-term local currency facility to a multilateral development bank. The two institutions plan to replicate the facility for future projects in Kenya as well as in other countries in Africa and elsewhere.
"Currency volatility and debt distress has made access to local currency financing more important than ever,"said John Gandolfo, IFC Vice President and Treasurer, Treasury & Mobilization. "By partnering with Citi, IFC can expand its ability to source local currency financing to provide local currency solutions for our clients and help shield them from currency fluctuations."
"We are pleased to partner with the IFC to develop innovative local currency solutions," said Julie Monaco, Global Head of Public Sector Banking at Citi. "This inaugural Citi facility with IFC in Kenya is a first-of-its kind solution and has the strong potential for replication across our emerging market franchises. By working strategically with multilateral development banks and development finance institutions, Citi's local currency platform addresses currency mismatches and foreign exchange risk, especially prominent in continents like Africa, which then accelerates financing for development projects."
Availability of local currency is an important priority for businesses in emerging markets and developing economies. When companies borrow in foreign currencies such as the US dollar, while earning revenues in local currency, large exchange rate movements can increase their debt burdens and undermine their financial stability.
IFC offers a wide array of local currency products to its clients, including loans, bond investments, cross-currency swaps, securitizations, guarantees, and risk-sharing facilities. Between July 2023 and June 2024, IFC committed $5.9 billion in local currency financing, which represents more than 30 percent of its long-term debt commitments. Over the last decade, IFC has committed over $30 billion in more than 70 local currencies.
About IFC
IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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About Citi
Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in more than 180 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.
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