Standard Chartered Bank and Africa Finance Corporation have struck a partnership to launch a risk participation programme to boost trade finance in Africa.
According to a statement by the bank, the programme is the first between Standard Chartered and the AFC, and is expected to generate an estimated incremental trade volume in excess of $350m over the three-year life of the transaction.
The bank said the programme was a portfolio-based, risk-sharing facility, with Standard Chartered and AFC taking up to a 50:50 basis on the underlying portfolio of the trade finance instruments through African issuing banks.
The President, AFC, Mr. Andrew Alli, said access to trade financing had reduced significantly across emerging markets, particularly in Africa, as a result of changing regulatory landscapes, as well as a general reduction in credit risk outlook in the wake of the global financial crisis.
Alli said the arrangement with Standard Chartered had a strong African footprint and trade finance infrastructure that could help boost trade finance activities within the region.
He added that the AFC would be taking the relationship forward by working together on various other initiatives across corporate and regional trade.
He said he believed that by working together with the bank, they would be able to support the real trade economy in this very emerging vibrant continent.
The Global Head, Transaction Banking, Standard Chartered, Lisa Robins, said the management of the bank was honoured to partner the AFC to support the region’s economic and developmental needs.
She described the programme as a testament to the bank’s commitment to enable economic growth through global trade and commerce.
The Head, Global Banking, Standard Chartered, Nigeria, Mr. Leke Ogunlewe, said he was delighted to be working with the AFC on the trade finance initiative, saying, “Partnerships of such nature promote trade to support clients’ flows in and through Africa.”