Cal Bank has signed a 108 million dollar deal with the Overseas Private Investment Corporation (OPIC) and Citibank (Citi) for on-lending to Small and Medium Enterprises (SMEs) in Ghana.
The arrangement will enable Cal Bank to advance loans at relatively low interest rates to SMEs in Ghana with flexible repayment terms.
In addition, beneficiaries of this short to medium term financing will have access to dollar denominated loans for business expansion and new equipment.
CalBank has received previous financing support from both OPIC and Citi. In 2014, CalBank was the first institution in Ghana to collaborate with Citi and OPIC to raise USD40 million to support SMEs.
As part of their new agreement, OPIC will provide USD100m in financing, while Citi will finance the remaining USD8 million.
Citi served as Sole Lead Arranger and Facility Agent on the transaction.
The agreement was signed in Ghana at the Cal Bank head office by representatives of OPIC, Citi and CalBank.
At the signing ceremony, Mr. Frank Adu Jnr, Managing Director of Cal Bank, said “the agreement has been made possible because the parties involved believe in the vision of CalBank and the capability of the Bank in supporting the Small and Medium Enterprises over the years. As a Bank, we shall continue to build the necessary partnerships with all our stakeholders even as we journey forward together. It is a ground-breaking transaction and we look forward to many more of such transactions going forward”.
Commenting on the agreement, Ms. Julia Robbins, OPIC Director of Structured Finance and Insurance, stated that, “Our commitment to meeting the capital needs of SMEs requires collaboration with institutions like CalBank that have the capacity to channel resources to communities that are under-served and often difficult to reach. We are proud of this project, which will help entrepreneurs across Ghana build thriving businesses that give back to their families and communities.”
Mr. Akin Dawodu, Head of Citi Sub-Sahara Africa remarked: “We continue to support real-economy initiatives such as this landmark financing closed with CalBank, in partnership with OPIC. This financing will provide support to SMEs in Ghana and will further enhance their role as key catalysts of economic growth in the country.”