Nairobi, 16 November 2020 – Denmark’s Investment Fund for Developing Countries (IFU) has invested USD 20 million in additional Class B shares of the Eastern and Southern African Trade and Development Bank (TDB), effectively doubling its equity investment in the Bank to USD 40 million.
The signing ceremony was hosted at TDB by the Bank’s President and Chief Executive Admassu Tadesse, with IFU represented by H.E. Ole Thonke, Ambassador of the Kingdom of Denmark to the Republic of Kenya.
IFU became TDB’s first European fund to invest in TDB’s Class B shares in December 2019, when it bought an initial USD 20 million in the Bank’s capital stock. A cooperation agreement had also been signed during the same occasion to explore co-financing opportunities in several key sectors and collaborate on different initiatives such as TDB’s SME Programme, technical assistance, and more.
“We are very pleased to take our partnership with IFU to new heights with this new injection in our risk capital” said Admassu Tadesse, TDB President and Chief Executive. “This recapitalization is a signal to the market that the institutional investor community continues to show confidence in TDB’s performance, opportunities, and impact, even amidst the Covid-19 global liquidity crunch. Thanks to IFU’s new investment in our Class B shares, we can look forward to continue stepping-up our commitment to driving SDG-focused interventions in our member states and among the communities we serve.”
“To tackle the negative impact on the economy from COVID-19 and help fund renewed growth in Africa strong African financial institutions are needed. IFU is pleased to strengthen our engagement with TDB contributing an additional USD 20m in risk capital. TDB plays a significant role in mitigating the negative impacts of Covid-19 and helping the region regain the growth momentum towards the Sustainable Development Goals” said Torben Huss, IFU CEO.
“Since TDB’s capital structure reforms in 2012, the Bank’s equity has grown four-fold, with 4 new member states joining the Bank, and 17 institutional investors purchasing Class B shares – including some which have recapitalized by buying new shares or reinvesting their dividends” added Mary Kamari, TDB Corporate Affairs and Investor Relations Executive. “With double-digit returns on equity, our net asset value (NAV) having risen from USD 5,996 in 2012 to USD 12,213 in 2019, and half of our portfolio contributing to SDGs, TDB consistently deliver high levels of development impact alongside attractive financial returns, as it continues expanding its geographic footprint.”
Indeed, as the pandemic has been unfolding, TDB has continued to grow and deliver triple bottom-line returns. During this period, the Bank has been able to attract an additional USD 2 billion in resources from key policy and commercial banks, who – like equity investors – keep choosing TDB to intermediate their capital into the region because of its solid standing as an innovative, and trusted financier of sustainable development imperatives.
Established in 1985, the Eastern and Southern African Trade and Development Bank (TDB) is a multilateral, treaty-based, investment-grade development finance institution, with 40 sovereign and institutional shareholders and assets of USD 6.7 bn. TDB serves 22 economies in its region, with the mandate to finance and foster trade, regional economic integration and sustainable development.
IFU provides risk capital and advice to companies wishing to do business in Africa, Asia, Latin America and parts of Europe. Investments are made on commercial terms in the form of equity and loans. The purpose is to contribute to economic and social development in the investment countries and support the Sustainable Development Goals. IFU and IFU managed funds have co-invested in 1,300 companies in more than 100 developing countries and emerging markets. Contracted investments total USD 33 billion, of which IFU has contributed USD 3.6 billion. Total capital under management is USD 1.8 billion.
Anne-Marie Iskandar, Senior Communications Officer
Corporate Affairs and Investor Relations
Trade and Development Bank
Investment Fund for Developing Countries