Nigeria’s Coronation Merchant Bank has received a $20M Trade Finance Guarantee Facility from Proparco, the private sector financing arm of Agence Française de Développement Group (AFD Group).
The facility will enable Coronation Merchant Bank to create and solidify partnerships with correspondent banks, thereby increasing access to trade finance in Nigeria.
Established in 1993 as Associated Discount House Limited, the bank obtained a merchant banking license from the Central Bank of Nigeria in 2015 and became Coronation Merchant Bank Limited. It is mainly active in corporate, investment and Trade Finance operations.
The deal is being coordinated by the Mandated Sole Arranger Blend Financial Services while the facility under Proparco’s Trade Finance Guarantee Programme will enable Coronation Merchant Bank to issue Trade Finance instruments for up to $20M, with a 100% guarantee from the AFD Group. The programme secures trade transactions and facilitates trade relations between Nigerian importers and international exporters for essential commodities.
Speaking on the deal, Emmanuel Haye, Head of Proparco’s FI debt group for Africa said, “Proparco and Coronation Merchant Bank Limited are collaborating for the first time with this trade finance operation. This transaction will enable Coronation Merchant Bank Limited to finance more commodity imports, which are essential to support the Nigeria’s economy, which has been impacted by the Covid-19 crisis and now the global supply chain disruptions.”
Commenting on the development, Banjo Adegbohungbe, Managing Director/Chief Executive Officer, Coronation Merchant Bank stated, “We are delighted to collaborate with Proparco as we jointly offer trade finance solutions to enable our customers achieve their business objectives while playing our part in the recovery of the Nigerian economy. This partnership is in line with our strategy and is a significant milestone for the bank.”
“The facility was targeted to bring about a comprehensive solution that provided 100% coverage of the import contracts of the Bank’s clients helping CMB to access multiple banking partners and boost their trade activities. Blend’s advisory services to CMB in partnership with Proparco underscores our commitment to supporting Financial Institutions across the continent to keep trade flowing and allow crucial capital access during these times of increasing global economic uncertainty,” said Vaibhavi Thakkar, CEO of Blend Financial Services.
