Business

AfDB invests $10m to spur capital marts

Wednesday, November 22nd, 2023 05:00 | By

African Development Bank (AfDB) has announced a $10 million (Sh1.52 billion) equity investment through a Kenyan firm to provide credit guarantees on long term debt held in local currencies in East Africa.


It said Kenya-Dhamana Guarantee Company Limited will be domiciled in Kenya as a limited liability company with a regional mandate to provide credit guarantees on debt capital market instruments.


Nnenna Nwabufo (pictured), the bank Director-General for the East Africa region explained in a statement that the financing will enable Dhamana to issue guarantees for debt instruments.

“These local currency bonds are intended to boost the credit rating of the instruments to crowd in investment from pension funds, insurance companies and sovereign wealth funds to finance infrastructure and the real sector in East Africa,” she said.

The bank, Nwabufo added together with InfraCo Africa, Financial Sector Deepening Africa, and local institutional investors and other partners, will be supporting the operationalisation of Dhamana.


“Dhamana will support access to financing for key sectors including transport, water, renewable energy, and waste management, among others,” she said, adding that Dhamana is committed to catalyse financing to assist the scale-up of green and sustainable financing into East Africa.

“Its credit guarantee activities should provide investors with the necessary comfort to support the allocation and intermediation of pools of private institutional investors’ funding into infrastructure.”


Nwabufo added: “The African Development Bank is pleased to continue to support the operationalization of innovative solutions such as those provided by Dhamana to unlock and channel long-term local currency funding towards the real sector.”


Private Infrastructure Development Group’s (PIDG) CEO, Philippe Valahu, said, “African Development Bank joining PIDG marks a significant milestone for the Dhamana Guarantee Company.

African Development Bank (AfDB) has announced a $10 million (Sh1.52 billion) equity investment through a Kenyan firm to provide credit guarantees on long term debt held in local currencies in East Africa.


It said Kenya-Dhamana Guarantee Company Limited will be domiciled in Kenya as a limited liability company with a regional mandate to provide credit guarantees on debt capital market instruments.


Nnenna Nwabufo (pictured), the bank Director-General for the East Africa region explained in a statement that the financing will enable Dhamana to issue guarantees for debt instruments.

“These local currency bonds are intended to boost the credit rating of the instruments to crowd in investment from pension funds, insurance companies and sovereign wealth funds to finance infrastructure and the real sector in East Africa,” she said.

The bank, Nwabufo added together with InfraCo Africa, Financial Sector Deepening Africa, and local institutional investors and other partners, will be supporting the operationalisation of Dhamana.


“Dhamana will support access to financing for key sectors including transport, water, renewable energy, and waste management, among others,” she said, adding that Dhamana is committed to catalyse financing to assist the scale-up of green and sustainable financing into East Africa.

“Its credit guarantee activities should provide investors with the necessary comfort to support the allocation and intermediation of pools of private institutional investors’ funding into infrastructure.”


Nwabufo added: “The African Development Bank is pleased to continue to support the operationalization of innovative solutions such as those provided by Dhamana to unlock and channel long-term local currency funding towards the real sector.”


Private Infrastructure Development Group’s (PIDG) CEO, Philippe Valahu, said, “African Development Bank joining PIDG marks a significant milestone for the Dhamana Guarantee Company.

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