Boost for Ecobank Zimbabwe after parent firm signs $100m facility

Boost for Ecobank Zimbabwe after parent firm signs $100m facility

HARARE, January 13 (The Source) – Ecobank Zimbabwe is set to improve its underwriting capacity after parent company, Ecobank Transnational Incorporated signed a seven-year $100 million loan facility with  the European Investment Bank, an official has said.

Ecobank Transnational Incorporated chief executive Albert Essien said the bank will use the loan to provide some of its subsidiaries with additional lending capacity and will finance some of the group’s strategic capital expenditures.

“This funding continues our relationship with the European Investment Bank. It will allow us to continue to consolidate our expanded operations and translate our scale and geographical footprint into added value for our customers,” he said in a statement on Tuesday.

Essien noted that Ecobank continues to contribute positively to the African economies by increasing the levels of credit available to businesses while at the same time generating long-term value for its shareholders.

“We shall use the financing to maintain credit provision in key economies in Africa thus contributing to the development of the continent,” he said.

Ecobank, which acquired a 70 percent stake in Premier Finance Group and has in the past four years injected over $20 million into its Zimbabwean unit, currently has a presence in 36 African countries.

Market experts say the move by Ecobank will boost the local unit operating in a market constrained by serious liquidity challenges.

In the six months to June last year, Ecobank Zimbabwe saw its net operating income growing by 14 percent on the back of increased trade finance activities, reduced cost of funds and an increased customer base driven by a wider network of branches and ATMs.

The bank also benefited from credit lines worth $28 million from within the Ecobank Group.