stanbic bank uganda
Financiers from the Middle East have demonstrated their support towards a fund raiser by Stanbic Bank Uganda.

In East Africa, Stanbic Bank Uganda is reported to have raised a total of $55 million through a syndicated loan provided by banks from the Middle East.

Last week, The East African quoted the bank , which said that the funds will boost lending to telecommunications, energy and mining sectors, among others.

The bank’s lead arrangers included Al Ahli Bank of Kuwait K.S.C.P, Bank of Baroda, SBM Bank (Mauritius) Ltd, and The Commercial Bank (Q.S.C), while Emirates NBD Capital Limited was designated bookrunner for the deal, media reported.

Stanbic Bank Uganda exhibits market leadership

According to the Bank, the debt transaction initially targeted $40 million but was oversubscribed by $15 million amidst strong market appetite witnessed in the Middle East financial markets, local media reported.

The Bank added that the syndicated loan carries a two-year duration and is priced at 275 basis points above the London Interbank Borrowing Rate.

Stanbic managing director, Patrick Mweheire, commented: “We are pleased that Stanbic Bank Uganda continues to demonstrate market leadership by completing another successful transaction in the international loan market, in an extended two-year tenor at such tight pricing.”

He added: “The oversubscription of our syndicated loan transaction further validates the confidence that the international financing community has in our consistent growth story.”

According to media, Stanbic Bank Uganda previously raised $85 million through a corporate bond structured in 2014 from the same market; an amount that was fully repaid prior to the conclusion of the new transaction.

Power and infrastructure projects

This initiative will assist the development of power and infrastructure projects being developed both in Uganda and across Africa.

In May 2016, Patrick Mweheire, CEO of Stanbic Bank Uganda said in a statement: “The cost of undertaking power and infrastructure projects in Uganda and Africa in general is twice as expensive when compared to the developed world.”

He advised that the risks that accumulate as a result of investment in power and infrastructure projects should be collectively distributed among all stakeholders to save one party from bearing all the risks in bids to ease as well as increase growth and investment in power and infrastructure sector.

Mweheire noted that this move calls for the development of clear, consistent and transparent legal and policy frameworks to guide public and private stakeholders engaged in sector.

Mweheire continued highlighting that while the Ugandan government’s main focus is on the development of national infrastructure; the development of sub-regional infrastructure like sub-urban, urban and city infrastructure has been ignored.

He added that there is need to develop such infrastructure, stating that in undertaking such development the same consideration should be given by all stakeholders.

 

EAPIC 700X80