A United Kingdom development finance institution (DFI), CDC Group, has offered a $75 million debt commitment to Stanbic IBTC Bank.
Stanbic IBTC is a member of Standard Bank Group.
CDC in a statement said the funding will enable Stanbic IBTC continue lending to businesses in sub-sectors of the economy that are important for domestic consumption and exports.
The organization said the funding comes at a crucial time of economic disruption caused by COVID-19 pandemic, resulting in cash flow and access to finance challenges for companies in Nigeria.
The statement noted that manufacturing, food and agriculture sub-sectors, which make up more than a third of the bank’s current portfolio, will particularly benefit from the investment.
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It also said CDC’s debt commitment will give Stanbic IBTC access to long-term dollar funding, that will enable the Bank lend for export and other dollar earning businesses in Nigeria.
Benson Adenuga, head of CDC Nigeria and coverage director, explained that the debt facility is an important step in supporting Nigerian businesses in crucial sub-sectors such as food and agriculture.
“This deal cements our relationships with Stanbic IBTC and Standard Bank Group, both key partners in Nigeria and across the continent,” he said.
“Our patient capital plays an important role in unlocking dollar funding, which is vital to finance longer-term investment projects in Nigeria.”
On his part, Wole Adeniyi, chief executive of Stanbic IBTC Bank, said the partnership with CDC will strengthen the bank’s commitment to support Nigerian businesses amid the current context.
He said: “Continuing to provide financing to local businesses is fundamental to mitigating the impacts of COVID-19 and accelerating Nigeria’s long-term economic recovery.”