Abidjan, Côte d'Ivoire — IFC, a member of the World Bank Group, today announced a €25 million, one-year senior loan to NSIA Banque Côte d'Ivoire (NSIA), allowing the bank to extend new trade-related or working capital loans to companies whose cash flows have been disrupted by the Covid-19 pandemic.
The loan is IFC's first investment in Côte d'Ivoire as part of its global COVID-19 fast-track financing support package, designed to help client financial institutions -- and the thousands of smaller businesses they support--weather COVID-19-related disruptions.
IFC's loan to NSIA is supported by the International Development Association's Private Sector Window (IDA PSW) Blended Finance Facility, which is backing IFC's COVID-19 working capital loan facility with a first-loss guarantee of up to US$215 million in eligible countries.
Olivier Buyoya, IFC's Country Manager for Cote d'Ivoire, said, "This investment demonstrates how IFC is working to help businesses in Côte d'Ivoire and across Africa continue to operate, preserve jobs, contribute to economic stability and accelerate recovery amid the unprecedented challenges posed by the COVID-19 pandemic."
With IFC's support, NSIA, one of Côte d'Ivoire's largest commercial banks, will increase its lending to traders, corporate clients and SME's, despite contractions to the financial market caused by the COVID-19 pandemic. IFC's project intends to help the bank provide working capital and trade-related lending to corporate and small and medium-sized enterprise (SME) clients over two years.
Léonce Yacé, Managing Director of NSIA, said, "We are proud and honored to have been selected by IFC, our long-standing partner, as the first banking institution in Côte d'Ivoire to benefit from this innovative financing mechanism adapted to market needs. Signing this COVID-related facility is another positive milestone in our growing partnership with IFC, and we are grateful for that."
In February 2020, IFC invested in a XOF40 billion (US$67.5 million) securitization program with NSIA. The loan marked the first securitization loan originated and serviced by a commercial bank in the West African Monetary Union (WAMU) and helped NSIA increase its lending to SMEs and access local capital markets and long-term, cost-effective funding through a source matched to its underlying assets.
COVID-19's economic and social impacts are expected to be substantial in Côte d'Ivoire, with GDP growth expected to drop from 6.9% in 2019 to 2.7% in 2020, while key export sectors--cocoa and related products, oil, rubber and cashew--risk a slow-down due to volatility on the global markets and dropping demand.
SOURCE International Finance Corporation (IFC)