Standard Bank signs Covid-19 response loan with IFC
The Standard Bank of South Africa Limited (“SBSA”) has signed a $185m, 3-year loan agreement with International Financial Corporation (“IFC”), a development finance institution that is part of the World Bank Group, with a focus on private sector development.
The loan proceeds will be used for immediate relief and ongoing support for eligible Small and Medium Enterprises (“SMEs”) and corporates in South Africa that have been affected by Covid-19 by assisting them with the purchase and production of goods and services needed to cope with the crisis and towards stimulating long-term investments in affected industries.
“We take our responsibility as a corporate citizen seriously and value the ongoing collaboration with IFC. This transaction reflects Standard Bank’s commitment to supporting our clients through this pandemic.” says Lungisa Fuzile, CE of Standard Bank, South Africa.
“This is an unprecedented crisis, with devastating health, economic and social consequences. Our experience from past shocks has taught us that keeping companies solvent is key to saving jobs and limiting the economic damage. That’s why it’s critical to work with institutions like Standard Bank to help companies access finance that will enable them to continue to operate during this time,” said Adamou Labara, IFC’s Country Manager for South Africa.
The transaction, which is aligned to Standard Bank’s broader sustainable finance strategy, will increase the availability of finance for sectors heavily impacted by the Covid-19 crisis, including the healthcare industry. This, in turn will help the private sector to contribute to economic recovery.
“Standard Bank recognises the importance of embedding social, economic and environmental considerations into its lending decisions and business practices. We acknowledge that its success is intricately linked to the prosperity and wellbeing of our clients and the societies in which we operate,” Fuzile said.
The transaction complements the Covid-19-relief measures already extended to clients. By the end of May, Standard Bank had provided R92 billion of relief to individuals, SMEs and commercial clients in South Africa across 285 000 accounts. In addition, R11 billion was provided to commercial clients in Africa Regions across 14 000 accounts. Restructures for corporate clients had been concluded for eligible clients with risk exposures amounting to approximately R30 billion.