Access Bank, EIB sign credit line agreement

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Access Bank Ghana and European Investment Bank (EIB) have signed a new credit line agreement to provide loans for companies across Ghana in both euros and United States’ dollars, with a tenor of up to eight years.

This represents a much longer maturity than typically available at present in the country.

According to a statement by Access Bank, lending under the scheme will support investment in agriculture, manufacturing, construction, transport, education and healthcare.

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It is also expected to reinforce long-term investment by Ghanaian companies crucial for supporting economic growth, benefiting from new business opportunities and creating jobs.

The bank said the EIB agreed to the new credit line after a thorough due diligence process.

This new engagement is part of a wider initiative by the EIB to strengthen the banking sector in Ghana through backing expansion of branch networks, IT systems and staff training, according to the statement.

It said the EIB had invested in public and private sector projects in Africa for more than 50 years and in Ghana since 1976.

This, it said, has included direct loans, credit lines with local banks and investment in smaller projects by private equity or microfinance funds. The EIB’s engagement has supported investment in several sectors including energy, industry, transportation, and financial sector.

The EIB was said to have provided more than 2.5 billion euros for public and private investment across Africa.

According to the statement, the EIB is the long-term lending institution of the European Union owned by its member states. It makes long-term finance available for sound investment in order to contribute towards EU policy goals.

The EIB also helps to implement the EU’s policy towards those countries that co-operate with the Union for economic development, the statement said.

It said the bank’s financing activities in sub-Saharan Africa were increasingly targeted on reducing poverty and stimulating sustainable growth, in particular through the development of the private sector.

The statement said the agreement was the first engagement between the bank and the European Union’s long-term lending institution under a wider initiative to support private investment in the country and further develop Ghana’s financial sector.

The new lending programme represents the fourth scheme to support investment in the country under an EUR80m credit facility launched two years ago to improve access to finance by firms in Ghana.

The Vice-President, European Investment Bank, Mr. Pim van Ballekom, was quoted as saying, “Over the last 40 years the European Investment Bank has supported private sector investment in Ghana and across Africa.”

The EU Delegation Ambassador, Mr. William Hanna, said, “This new engagement with Access Bank shows how the EIB, as the EU Bank, is working tirelessly to improve access to finance for SMEs in Ghana. Investment by private companies is essential for economic growth and job creation in the country.”

The Managing Director, Access Bank Ghana, Mr. Dolapo Ogundimu, said, “Our commitment to best practice coupled with our strong corporate governance and risk management structures are helping to attract the right kind of investment that we need to support local businesses in the economy. Early on we received a $40m facility from the FMO and PROPARCO.” – Punch.