The Co-operative Bank of Kenya has received a long-term 7-year funding facility amounting to USD 100 million (Kshs 13.8 Billion) from a consortium of financial institutions led by DEG for on-lending mainly to Micro, Small and Medium-sized Enterprises (MSMEs) in Kenya.
The loan is a Tier II Facility that has already been fully disbursed, where DEG acted as Lender, MandatedLead Arranger and Facility Agent. At the same time, the Consortium included The Africa Agriculture & TradeInvestment Fund (AATIF), Micro Small Medium Enterprises Bonds (MSMEB) and European Development Finance Institutions namely Finnfund, Norfund and the co-financing facility European Financing Partners(EFP).
Commenting upon the disbursement of the facility, Co-operative Bank Group Managing Director & CEO Dr. Gideon Muriuki said,
“The funding by DEG and the Consortium is most timely in view of the great need to better support our business customers. In addition, the long-term tenure of the facility hassignificantly boosted the bank’s ability to offer solutions that are better structured to fulfil the long-term financing needs of MSMEs.”
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Monika Beck, a Member of DEG’s Management Board said,
“By acting as lead arranger and providing thesubordinated loan to Co-op Bank, DEG contributes to the further development of Kenya’s financial sector and the wider economy through the creation of jobs and local income, all geared towards theattainment of Sustainability Development Goals.”
Co-op Bank continues to leverage its strong balance sheet to access funding and allied partnerships withglobal development partners to enhance the bank’s opportunities for growth and overall performance ashere under;
- Enhance the bank’s assets and liability match where long-term loans can be financed using thelong-term debt.
- Diversify the bank’s asset and funding
- Expand the bank’s client base especially among
- Boost the bank’s competitive position on account of affordable
The DEG-led facility is a significant support to the bank especially at this point in time when the bank’s digitization journey is moving full steam ahead with the recent transition to a new, robust core banking system.
