The OPEC Fund for International Development and the Eastern and Southern African Trade & Development Bank (TDB) are deepening their cooperation with the OPEC’s Fund’s latest commitment of debt and equity totalling USD 40 million. These recent investments in TDB aim to further strengthen the partnership and unlock synergies in support of sustainable development in Africa.
A USD10 million Class B equity investment, the second since the OPEC Fund and TDB began their partnership in 2009, will support the bank’s capitalization and increase its financing capacity in TDB’s 22 member countries.
Class B shares were introduced in TDB’s capital structure in 2013 to attract institutional investors. This asset class offers capital growth, dividends, and impact that has drawn strong interest from several investors. Since inception, a range of institutional investors from Africa, Europe and Asia have invested USD 228 million in the Class B share segment. During 2021, the Bank received additional equity injections of USD 6m in Class B shares from Caisse Nationale de Sécurité Sociale of Djibouti (CNSS), the national social security fund of Djibouti and Sacos Insurance Group.
The OPEC Fund and TDB today also signed a USD 30 million loan to support infrastructure projects in Eastern and Southern Africa as they recover from the COVID-19 pandemic and its economic impact.
OPEC Fund Director-General Dr. Abdulhamid Alkhalifa said at the signing in Vienna today: “Strong regional development banks such as TDB are an important source of funding on the continent in sectors like trade and infrastructure. Our most recent investments are a testimony to our flourishing partnership with TDB and emphasizes our strong joint commitment to boost sustainable economic development in Africa.”
TDB Group President Emeritus and Managing Director Admassu Tadesse said: “We are delighted to be deepening our strategic partnership with OPEC Fund with this new investment and other facilities. It demonstrates continued confidence in TDB Group, both its mandate and performance, amidst global challenges. With this investment we look forward to growing our infrastructure and trade financing in Africa.”
TDB Group Executive Corporate Affairs and Investor Relations Mary Kamari said, “TDB Group enjoys growing support from its existing shareholders. With this investment, the OPEC Fund has increased its equity stake by 50%. The Bank’s class B equity base has grown very well, now with 18 institutional investors in the shareholder community, including pension funds, insurance companies, central banks and development finance institutions.”
The OPEC Fund and TDB have been partners since 2009, with joint projects for USD 200 million through loans, equity and risk participation. The cooperation focuses on the provision of financing to the agriculture, trade, industry, infrastructure, energy, and tourism sectors as well as the promotion of economic and social development. Africa is the top recipient of OPEC Fund financing and in 2021 accounted for 51 percent of the fund’s new commitments.