E-Financial
AfDB Approves $15m to Close Infrastructure Gap in Nigeria
The board of African Development Bank (AfDB) has approved a $15 million subordinated loan to Infrastructure Credit Guarantee Company Limited (InfraCredit) to strengthen its capital base and help close Nigeria’s infrastructure financing gap.
The financing will enable InfraCredit to leverage domestic capital markets to bolster access to long-term local currency infrastructure financing in Nigeria.
It complements a 2019 investment into InfraCredit made by the AfDB and other partners to help unlock domestic institutional capital for infrastructure.
InfraCredit is a specialized Nigerian credit guarantee company that mobilizes long-term capital from institutional investors, including pension fund and insurance companies, to support infrastructure projects.
The loan comes at a time when InfraCredit is seeking to raise capital to finance an additional $375 million in infrastructure over the next few years, primarily by leveraging private sector financing.
Lamin Barrow, director-general of the bank’s Nigeria Country Department, said: “The AfDB is pleased to continue to support an innovative financial institution – InfraCredit -which has objectives that align closely with our priorities to mobilize institutional financing for the delivery of infrastructure for Nigeria in key sectors including transport, energy, water, agriculture and infrastructure.”
The company’s green finance track record and commitments under its Clean Energy Transition Strategy and Roadmap and Green Finance Framework fits with the African Development Bank’s commitments to promote low-carbon development and mitigation, leveraging climate finance from private sector sources, Barrow said.
Also speaking on the facility, Chinua Azubike, InfraCredit CEO, said: “We are delighted and very pleased with the confidence that AfDB has demonstrated in the opportunity ahead for InfraCredit to scale its development impact of unlocking domestic institutional investments for long-term local currency infrastructure finance in Nigeria that will create jobs and support local economic growth. This second round (of) investment will strengthen our guarantee issuing capacity and bring AfDB’s total investments in InfraCredit to $25 million, which is a strong signal of commitment to the long-term growth of InfraCredit and the Nigerian economy.”
Ahmed Attout, AfDB acting director for Financial Sector Development, said: “The support demonstrates our continuing confidence in InfraCredit and recognition of the role it plays in Nigeria’s infrastructure development. The AfDB is committed to capacitating the various players within Africa’s capital markets and stimulating the mobilization of long-term funding into Africa’s infrastructure.”
The partnership advances a number of strategic objectives under the Bank’s current Country Strategy Paper for Nigeria, which includes helping to stimulate local currency bond market financing across diverse infrastructure sectors, as well as enhancing economic diversification and competitiveness in the country.
The strategy also prioritizes delivery of infrastructure for transport, energy, water and sanitation, agriculture, industry and social development.
The intervention is also aligned with the Nigeria’s National Development Plan which envisages strong private sector resource mobilization and participation in the delivery of the priorities of the plan including for investment in infrastructure, promotion of financial sector and capital market development in the country.
FCMB Capital Markets Ltd. successfully led the issuance of GLNG Funding SPV Plc’s ₦11.85 billion 10-Year Series 2 Senior Guaranteed Fixed Rate Infrastructure Bond, which closed in February. This milestone underscores investor confidence in Nigeria’s clean energy transition.
The bond, issued by GLNG Funding SPV Plc and sponsored by Green Liquified Natural Gas (GLNG) as part of its capital-raising plans, is a key step in financing the construction of a mini-LNG plant with a liquefaction capacity of 200,000 standard cubic meters of gas per day.
The facility will help bridge Nigeria’s power supply gap and offer industries a cleaner, cost-effective alternative to diesel.
The issuance was backed by InfraCredit, an AAA-rated infrastructure credit guarantee firm, and is expected to generate over 500 direct and 2,000 indirect jobs, supporting Nigeria’s sustainable economic growth.
“FCMB Capital Markets remains committed to financing projects that drive clean energy adoption and long-term economic impact,” said Ikechukwu Omeruah, Managing Director, FCMB Capital Markets Limited.
“We appreciate the trust placed in us by GLNG and the invaluable role played by InfraCredit and investors in enabling the successful conclusion of this transaction.”
As gas adoption accelerates in Nigeria, a 2022 Clarke Energy report estimates that manufacturers could save up to 30% by switching to gas from the grid and as much as 80% compared to diesel.
FCMB Capital Markets, a part of FCMB Group, has been instrumental in raising over ₦3 trillion in debt and equity capital for leading corporate organizations in Nigeria over the past five years, reinforcing its position as a key player in the country’s capital markets.
Nine leading Nigerian banks collectively generated N14.26 trillion in interest income in 2024, reflecting a 119.55% increase from N6.49 trillion in 2023.
This surge is attributed to the Central Bank of Nigeria’s Monetary Policy Committee raising benchmark interest rates to combat inflation, which reached 34.80% by the end of the year.
Among the banks, Zenith Bank recorded the highest actual income increase, while First Holdco led in percentage growth. Access Holdings, UBA, GTCO, Stanbic IBTC, FCMB Group, Fidelity Bank, and Wema Bank also reported significant gains.
However, a portion of this income was derived from non-performing loans, raising concerns about the sustainability of these earnings.
In contrast, the manufacturing sector faced operational costs of N2.5 trillion, with high interest and energy expenses straining growth. Industry leaders have called for a halt to further rate hikes, warning of potential risks to the real sector’s recovery.
This financial dynamic underscores the contrasting fortunes of Nigeria’s banking and manufacturing sectors. What are your thoughts on these developments?
In a bid to woo global capital and enhance investor’s confidence, Nigeria’s top financial leaders presented a unified front at a strategic investment forum hosted at the Nasdaq MarketSite in New York.
The event was organised by the Central Bank of Nigeria (CBN) in collaboration with Nigerian Exchange Group (NGX Group), JPMorgan, and the African Private Capital Association (AVCA).
The exclusive gathering brought together leaders from the Nigerian diaspora, global investment institutions, and corporate executives for insightful dialogue on the country’s evolving financial landscape and its readiness to attract global capital for sustainable growth.
Governor of the CBN, Olayemi Cardoso in a fireside chat with Nobel Prize-winning economist Dr. James Robinson, outlined Nigeria’s monetary policy direction, growth prospects, and efforts to deepen its financial markets.
He reaffirmed the CBN’s commitment to disciplined policy management, market-friendly reforms, and enhanced transparency to foster a stable, investor-friendly environment. Cardoso also stressed the importance of strong collaboration between regulators like the CBN and market operators such as NGX Group, describing it as critical to building a resilient financial system and mobilising long-term investments.
Temi Popoola, Group Managing Director/CEO of NGX Group, moderated an engaging discussion on how Nigeria’s reforms are repositioning the country as an increasingly attractive destination for global capital.
“Today’s dialogue marks a pivotal step in reshaping global perceptions of Nigeria’s investment story,” said Popoola. “The candid engagement between policymakers, market operators, and investors reflects the real progress Nigeria is making. NGX Group remains committed to supporting reforms that strengthen market structures, drive innovation, and accelerate economic growth.”
While investors welcomed Nigeria’s reform agenda, they emphasized that sustained confidence will require consistent FX policies, lower transaction costs, reduced regulatory friction, clearer direction on non-oil revenue reforms, an improved ease of doing business, and continued transparency in monetary and fiscal communication.
The forum ended on an optimistic note, with participants expressing strong confidence in Nigeria’s economic prospects and its potential for deeper integration into global financial markets, provided reform momentum continues.
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