Project Detail |
Provision of a USD 230 million, Trade Finance Package (Facility) to Access Bank Plc (“Access Bank” or “ABN”) comprising (i) a USD 170 million Trade Finance Line of Credit (TFLoC) with a 3.5-year tenor and (ii) a USD 60 million Transaction Guarantee (TG) instrument with a tenor of 3 years. The TFLOC will provide critically needed FX liquidity to support SMEs and local enterprises operating in the tradable sectors to settle maturing trade finance obligations and continue to have unencumbered access to international financial markets and global supply chains as they procure critical inputs such as raw material, equipment, and intermediate goods for further local processing. Under the TG, Access Bank will act as an Issuing Bank (IB) supporting trade finance activities in Nigeria while the Bank willprovide up to 100% guarantee to Confirming Banks (CBs) for the non-payment risk arising from the confirmation of letters of credit and similar trade finance instruments issued by ABN. The project contributes to climate finance, with 92 million USD of the total approved amount dedicated to mitigation. Project Objectives The TFLOC is expected to drive positive outcomes in (i) Private sector development by bridging the gap in trade finance faced by Nigerian businesses and (ii) Gender and social outcomes through support to women-owned and led businesses. The likelihood of achieving development outcomes was assessed to be high, explained by Access Bank’s strong market position in the banking sector in Nigeria, its financial performance, and its lending experience in multiple sectors. Beneficiaries Ultimately, the trade components would facilitate the importation of critical capital goods, agricultural inputs, foodstuff at a time of increasing scarcity of dollar denominated liquidity for firms in the tradable sector. |