Nigeria: AfDB Approved US$ 35 Million Credit Line for Access Bank Plc
Tunis, 13 December 2006- The Board of Directors of the African Development Bank (ADB) approved on Wednesday in Tunis, under its private sector window, a Line of Credit (LOC) of US$ 35 million to Access Bank PLC of Nigeria.
This LOC will be utilised by Access Bank to finance the establishment, expansion, modernisation and diversification of private sector productive facilities in various sectors of the Nigerian economy. Sectors targeted by Access Bank include infrastructures, agribusiness, manufacturing, telecommunications, as well as oil and gas.
It will also be used for the provision of project finance, specifically to finance the purchase or importation of capital and replacement equipment as well as machinery which will be used to increase the productive capacities and the export potential of the sub-borrowers. Part of the LOC will be used to meet the financing needs of SMEs particularly those that are export-oriented. The facility will help to maintain or create a large number of jobs and the projects financed will promote international trade. The financing of sub-projects will enhance capacity building and Nigeria’s skills base.
The provision of long-term lending to Access Bank will assist in the development of Nigeria’s capital markets. It will help reduce mismatches in tenure, in line with international best practices, as the availability of long-term funding will match that of the life of long-term projects, supporting the development of investment projects by small and medium size companies. The provision of the LOC is also consistent with the Nigerian government’s strategy of mobilising long-term funding for capital investments.
Through its private sector window, the Bank has so far approved financing for eight projects in Nigeria. In October 1992, the Bank approved a loan of UA 3.987 million to Spintex Nigeria Limited to finance the expansion of a polyester yarn plant to meet additional demand. In September 1993, the Bank extended a loan of UA 7.973 million to Consolidated Oil Limited (Conoil), an indigenous oil and gas exploration company for crude oil production. In October 1996, a loan of UA 2.392 million was granted to the Abuja International Diagnostic Centre Limited.
Furthermore, lines of Credit of UA 23.9 million were awarded to United Bank of Africa (UBA), UA 13.8 million to FSB International Bank, UA 37.7 million to Citibank, UA 47.50 million to Zenith Bank and UA 27.4 million to GTB by the Bank in December 2000, October 2001, September 2002, January 2005 and December 2005 respectively.
The Bank through the Private Sector window has also invested in the oil and gas sector through a US$ 100 million loan to Nigeria Liquefied Natural Gas (NLNG) to finance the expansion of a gas liquefaction plant located on Bonny Island.
* 1 UC = € 1.14; 1 UC = 1.50 $ EU en décembre 2006
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