Africa’s premier investment bank, Coronation Merchant Bank (CMB) has secured $20 million Trade Finance Guarantee Facility from Development Finance institution, Proparco to enable partnerships with correspondent banks, thereby increasing access to trade finance in Nigeria.
The Nigeria-based bank was founded in 1993 as Associated Discount House Limited (ADHL) and licensed by the Central Bank of Nigeria (CBN) to provide liquidity for national debt notes and money market instruments. In 2013, the bank transitioned into a merchant bank. So far since it obtained a merchant banking and an FX dealing license in 2015, its services include investment banking, corporate banking, trade finance operations among others.
In the press release stating the funding by Proparco, the programme which enables trade transactions between Nigerian importers and international exporters is coordinated by Mandated Lead Arranger (MLA), Blend Financial Services.
“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,” Head of Proparco’s FI debt group for Africa, Emmanuel Haye said.
As for the Managing Director/Chief Executive Officer, Coronation Merchant Bank, Banjo Adegbohungbe, he stated that: “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 Insitutions across the continent to keep trade flowing and allow crucial capital access during these times of increasing global economic uncertainty,” said CEO of Blend Financial Services, Vaibhavi Thakkar.
Proparco is a Development Finance Institution partly owned by the French Development Agency (AFD) and private shareholders committed to investing in Africa Asia, Latin America and the Middle East in order to achieve Sustainable Development Goals (SDGS). In 2019, the DFI committed to providing 2.5 million euros for African SMEs in four years as stated in its partnership with AFB.