Guaranty Trust Bank to secure 1.6 billion shillings IFC loan for SME lending

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Guaranty Trust Bank to secure 1.6 billion shillings IFC loan for SME lending


GT Bank Kenya is seeking a 3.2 billion shillings credit facility from IFC for subsequent loans to small and medium enterprises. PHOTO FILE | NATION MEDIA GROUP

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Summary

  • The International Finance Corporation is expected to lend $ 15 million (1.6 billion shillings) to Guaranty Trust Bank Kenya for subsequent loans to small and medium-sized enterprises (SMEs).
  • The loan is part of IFC’s financing of financial institutions in emerging markets as part of its response program to the Covid-19 crisis.

The International Finance Corporation is expected to lend $ 15 million (1.6 billion shillings) to Guaranty Trust Bank Kenya for subsequent loans to small and medium-sized enterprises (SMEs).

The loan is part of IFC’s financing of financial institutions in emerging markets as part of its response program to the Covid-19 crisis.

The loans are designed to be disbursed to businesses whose cash flows have been disrupted by the pandemic, thereby helping to increase their working capital, among other needs.

“The proposed loan of $ 15 million… is a one-year loan, with the option of being rolled over for an additional year at the discretion of IFC. The loan will provide GTBK with additional liquidity support for its operations amid the current economic challenges, ”IFC said in its investment statements.

“This project will benefit borrowers, mainly SMEs, with working capital and trade-related loans, stabilizing supply chains and building resilience in critical sectors such as trade, fast-moving consumer goods, pharmaceuticals and manufacturing, which have been affected by the pandemic. “

The bank is a subsidiary of Guaranty Trust Holding Company Plc, based in Lagos.

The Nigerian multinational acquired the Kenyan bank, formerly Fina Bank, in December 2013.

Guaranty Trust Bank Kenya now has nine branches focused on banking services for businesses, SMEs and individuals. The bank will provide loans to clients who meet the criteria established by the IFC.

The global financier defines SMEs using a variety of metrics, including companies with between 10 and 300 employees or annual sales of $ 100,000 (11 million shillings) to $ 15 million (1.6 billion shillings).

The loan amount per borrower typically ranges from $ 10,000 (1.1 million shillings) to $ 2 million (221 million shillings).

IFC also encourages the banks it finances to lend to women-owned businesses and climate-related projects, such as renewable energy projects.

The loan offered to the lender is the most recent from IFC, which has funded dozens of Kenyan banks, including KCB and Co-op Bank.


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