Portfolio guarantee to Orabank Togo, the largest bank in the country. The guarantee allows Orabank to benefit from capital relief, enabling the bank to grow its infrastructure portfolio whilst remaining within single obligor limits. The bank will lend to infrastructure projects and infraassociated businesses in Togo (LDC and FCAS).
Businesses and their employees in target sectors are expected to benefit. The largest impact will be for businesses that need capital to sustain their growth and/or expand.
SDG assessment
8.5 + 9.1 – Develop sustainable, resilient and inclusive infrastructure to deliver economic growth and create jobs.
Challenge: In West African Economic Monetary Union countries the implementation of Basel II and III banking regulations have limited the lending capacity of banks to infrastructure projects.
Channel: This transaction will increase access to capital available for infrastructure investment in West Africa.
Outcome: This structure could be replicated by other lenders to ensure continued infrastructure investment for businesses alongside the implementation of prudent regulatory requirements.
Transition: Orabank transactions shall be reviewed ex-ante to confirm Paris Alignment and transition risk as defined by the PIDG Climate Change Standard.
Physical: We will work with Orabank to build capacity to assess physical risk as part of wider support provided to help develop Orabank’s climate change strategy.
Mobilised $20m from Orabank Togo.
As part of the due diligence process, 5 HSES enhancement opportunities were identified which are now reflected in the Project Environmental and Social Action Plan (ESAP).
