- Date written
- September, 2020
- Contact for guarantco
- Marjolein van Kampen
- Communications Director
- +44 (0)738 8857097
- Contact for PIDG
- Cecille Sorhus
- Head of Communications
- +44 (0)7917 302724
First GuarantCo transaction in Tanzania
GuarantCo, a Private Infrastructure Development Group (PIDG) company, has provided CRDB Bank, the largest bank in Tanzania, with a USD 50 million TZS equivalent, 5-year portfolio guarantee to enable the bank to grow its infrastructure loan book.
Infrastructure development is undoubtedly critical and a priority for Tanzania’s long-term economic growth and competitiveness as it impacts economic activities by increasing productivity, facilitating trade and promoting innovation. The sector also provides the foundation upon which other sectors such as agriculture, manufacturing and services can grow. Mobilisation of non-traditional sources of finance, including those from the private sector, are necessary in Tanzania which has a population of 54 million people.
CRDB Bank is a leading bank with a focus on the infrastructure sector. The portfolio guarantee, as provided by GuarantCo, will create a risk-sharing partnership which will allow the bank to invest more in Tanzania’s infrastructure sector without breaching regulatory and capital limits set by the Bank of Tanzania. GuarantCo’s involvement does not stop with this transaction. It will also enable CRDB Bank to grow its loan portfolio and signify the beginning of a capacity building partnership whilst providing an opportunity to support the bank’s gender strategy.
PIDG Technical Assistance will be supporting a project finance capacity building workshop for financial institutions in Tanzania, together with CRDB Bank, aimed at building the capacity of local developers and financiers to create and deliver more infrastructure projects.
Lasitha Perera, CEO at GuarantCo said:
“We are delighted to have built this important strategic partnership with CRDB and work with them to explore further innovative transaction structures to finance infrastructure projects in Tanzania in the longer term. This guarantee by GuarantCo reflects our ongoing commitment to enabling local financial institutions to deliver more essential infrastructure to improve the lives of those living in lower income countries.”
Abdulmajid Nsekela, Group CEO and Managing Director at CRDB Bank Plc said:
“Our partnership with GuarantCo demonstrates our long-standing commitment to support economic growth and, will go a long way in improving the economic prospects of Tanzania. Our focus is to create an enabling environment for investment by pursuing mutual partnerships to mobilize the finances required for growth. We remain steadfast in supporting infrastructure development in Tanzania to support government initiatives to build a middle income semi industrialized economy whereby infrastructure is the key enabler.”