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The AfDB provides loans to its clients on non-concessional terms.  The Bank’s standard loans are categorized as either Sovereign-Guaranteed Loans (SGLs) or Non-Sovereign-Guaranteed Loans (NSGLs).  SGLs are loans made to Regional Member Countries (RMCs) or public sector enterprises from RMCs supported by the full faith and credit of the RMC in whose territory the borrower is domiciled.  Multinational institutions are eligible for SGLs if they are guaranteed by an RMC or by RMCs in whose territory or territories, the projects will be executed.

NSGLs are either loans made to public sector enterprises, without the requirement of a sovereign guarantee by the host government, or to private sector enterprises in all RMCs provided that they meet specific eligibility criteria.  For non-sovereign-guaranteed clients and private sector, the loan product offered is the Fixed Spread Loan (FSL).

Sovereign Guaranteed Loans (SGLs)

Beginning March 2016, the Fully Flexible Loan (FFL) will be the sovereign guaranteed loan product available to RMCs.  This product will replace the Enhanced Variable Spread Loan which has been discontinued. 

The new FFL product embeds risk management features currently offered through the Bank’s Risk Management Products (RMPs) directly into the loan terms.  Specifically, for all or part of disbursed and outstanding loans, the FFL product will allow borrowers the option to engage in certain loan conversions.  These include the flexibility to fix, unfix and re-fix the base interest rate and also to cap or collar the base interest rate.  Additionally, the FFL product now offers currency conversion flexibility, where borrowers may change the lending currency of all or part of undisbursed and/or disbursed loan amounts during the life of the loan.  

The new FFL product also introduces a maturity-based pricing structure and increases the maximum tenor and grace period of SGLs from the previous EVSL product, that is, from 20 years to 25 years and from 5 years to 8 years, respectively.  This allows eligible borrowers to select loan profiles that match their funding needs and debt management capacities.  

Determine My Average Maturity 

Overall, the FFL will provide increased flexibility for borrowers to tailor loan maturities and to manage currency and interest rate risks over the life of their loan.  By embedding the RMPs in the loan product, the International Swaps and Derivatives Association Master Agreement, which is a prerequisite for accessing the Bank’s RMPs and whose signing has hitherto proved challenging, will no longer be necessary for our eligible RMCs. For the FFL’s full lending terms, see here.

Non- Sovereign Guarantees Loans (NSGLs)

The loan product available to non-sovereign guaranteed borrowers and all private sector borrowers is the Fixed Spread Loan (FSL).  There are several available FSL loan structures offered by the Bank including lines of credit (LOCs), corporate loans, parallel and A/B loan syndications and local currency loans. 

The pricing of the FSL reflects the competitive pricing of the AAA rating of the Bank which is passed on to the borrowers.  The FSL provides borrowers transparent and market based pricing to tailor currencies and interest rates for their project needs.  The Bank’s local currency loans are offered under the FSL pricing framework with a cost-pass-through principle for the loans to ensure that the overall cost of funds is fully covered.  Local currency FSLs are available in a number of African currencies.  Please contact for more information. For the terms of the FSL, click here