AfDB approves US $90-million financial package to boost Commercial Bank of Africa’s funding of SMEs in Kenya and grow trade finance in Africa
The Board of Directors of the African Development Bank has approved a US $90-million financial package comprising a US $50-million Line of Credit and US $40-million Trade Finance Line of Credit to Commercial Bank of Africa Limited (CBA), Kenya.
The funding will be channeled to SMEs and local corporates in infrastructure, tradable and other transformative sector transactions in Kenya. It will provide liquidity support to expand financing to local corporates involved in value-addition in the trading, manufacturing, agriculture, infrastructure, transport, and construction, among other sectors. In so doing, it will enhance job creation and facilitate financial access to businesses.
This intervention will contribute to CBA’s efforts to broaden access to its services, thereby reducing financing constraints faced by SMEs and local corporates in Kenya whilst also reducing Africa’s trade financing gap. The package will promote private sector development as well as support broad-based economic growth. It will also contribute to CBA’s endeavors to complement the efforts of various partners such as the Government of Kenya’s Long Term Development Strategic Agenda and Vision 2030, which seeks to revitalize the economy by developing infrastructure and improving access to affordable credit for SMEs that support the economic transformation of Kenya’s economy to make it more resilient and diversified.
This transaction is well aligned with AfDB’s Ten Year Strategy 2013-2022, as well as the Bank’s High 5 strategic priorities, including Industrialize Africa, Integrate Africa, Feed Africa and Improve the quality of life for the people of Africa. It will help to increase enterprise development and competitiveness through expansion of the economic base. This will be made possible by enhancing access to financial services and expanding access to social and economic infrastructure, which will thus contribute to inclusive growth.
Established in 1962, CBA is the largest privately-owned Kenyan bank with operations in Kenya, Tanzania and Uganda. It is ranked as a Tier 1 bank by the Central Bank of Kenya and is the 6th largest of 43 banks in the country. The bank targets customers include corporates, institutions, SMEs and the quality end of the personal banking market. Outside its 19 million mobile platform customers, CBA offers a variety of conventional, as well as digital, banking products and services and has a broad client base spanning different sectors including telecommunications, manufacturing, agriculture and construction.