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Ecobank agrees $200 million risk-sharing deal for SMEs in Africa

Published

10 months ago

November 18, 2023

Ecobank has signed a new $200 million risk-sharing deal with the African Guarantee Fund (AGF) which will allow the disbursement of cheap loans to countries across Africa.

Under the arrangement, small and medium enterprises in Kenya, Uganda, Tanzania, Rwanda, and 23 other African countries will be able to access funds from the bank, which is to date the largest risk-sharing agreement on the continent.

To expand access to financing for SMEs and green businesses across the continent, the guaranteed agreement was signed on Thursday on the fringes of the African Financial Industry Summit (Afis) in Lomé, Togo.

SMEs are more likely than large firms to rely on internal funds or cash from friends and family for the launch and initial running of their enterprises.

AGF, a private sector credit guarantor based in Nairobi, will guarantee up to 75% of loans to women-led and environmentally conscious businesses, and 50% of loans to small and medium-sized enterprises (SMEs) across the continent. This arrangement will increase the accessibility and affordability of credit for these businesses.

The CEO of Ecobank Group, Jeremy Awori, stated that the risk-sharing agreement would promote the creation of jobs, business expansion, innovation, and environmentally friendly solutions for the continent by increasing credit extension to SMEs in 27 of the 35 markets they serve.

“Through this partnership, we are taking bold steps to enhance green financing and gender financing. In doing so, we aim to eliminate the rigorously restrictive requirement for collateral, particularly hindering women-focused businesses’ access to credit,” Mr. Awori said during the signing of the agreement in Lomé on Thursday.

“This partnership will catalyse close to $1 billion of financing for SMEs, who are the real drivers of growth in African economies,” said AGF CEO, Jules Ngankam.

According to the World Bank, SMEs account for the majority of businesses worldwide and are significant contributors to job creation and global economic development.

VenturesNow

Ezz al-Arab appointed as Egypt’s CIB chairman

Published

4 hours ago

September 16, 2024

Ifeoluwa Dada

Commercial International Bank (CIB), Egypt’s largest private bank, announced on Monday that long-time chairman and previous CEO Hisham Ezz al-Arab will become CEO.

Neveen Sabbour, a board member, will take over as chairman, according to a statement. Hussein Abaza, the outgoing CEO, will be replaced by Ezz al-Arab, who will hold the role for three years.

In Egypt, the market share held by traditional banks is expected to reach US$35.84 billion. As more clients choose online and mobile banking options, Egypt’s banking industry is seeing an increase in digital banking services.

The new appointments are part of “to lead the bank’s multifaceted business transformation and continue its programme to support recognised potential future leaders,” the announcement stated.

Ezz al-Arab, chairman and managing director since 2002, resigned in October 2020 due to “compliance concerns” from the national bank.

In August 2022, a year before his tenure expired, central bank governor Tarek Amer resigned due to a currency crisis. Ezz al-Arab was requested to rejoin as chairman in December.

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Nigerian inflation falls again, drops to 32.15% in August

Published

4 hours ago

September 16, 2024

Ifeoluwa Dada

Nigeria’s August inflation rate declined for a second month to 32.15% from 33.40% in July, the statistics office reported on Monday. This comes after the month of July saw the first decrease in consumer inflation in Africa’s largest country in almost a year.

Analysts predict August’s slowdown may be short-lived after two gas price increases this month enraged citizens facing the worst cost-of-living crisis in a generation.

The removal of a decades-old gasoline subsidy, devaluation of the naira currency, and increase in energy costs by President Bola Tinubu have raised prices.

Reforms attempt to boost economic growth and public finances.

The central bank’s next interest rate decision next week may be influenced by inflation figures. The apex bank has hiked rates four times this year to curb inflation, and economists say July’s hike may be the last.

Further petrol price increases and northern flooding that swept away crops could raise food prices.

“On the whole, disinflation should continue with the headline rate falling below 30% by year-end, but upside risks remain,” Capital Economics Africa analyst David Omojomolo wrote.

He claimed rising petrol prices might “slow the pace of the disinflation process” and that the central bank would not drop rates until early next year.

Food inflation dropped from 39.53% to 37.52% in August. It remained the greatest inflation driver in August.