IFC partners FCMB Bank to Develop Smaller Businesses in Nigeria

IFC, a member of the World Bank Group, has announced an $87.5 million loan to Nigerian bank FCMB that will help fund infrastructure, green energy projects, and strengthen smaller businesses in the country, spurring job creation and economic growth. 

The loan consists of $50 million from IFC’s own account and $37.5 million from IFC through the Managed Co-lending Portfolio Program (MCPP), a new IFC product that allows investors the opportunity to contribute to development by participating in IFC’s loan portfolio. 

The facility will fund FCMB’s infrastructure projects and includes IFC’s first energy efficiency and renewable energy (green energy) lending facility in Nigeria, along with financing for smaller businesses. Eligible projects in the green energy component include technical upgrades that improve efficiency and productivity in industrial processes, as well as investments that generate electricity from renewable energy resources.

Ladi Balogun, group managing director/ chief executive officer, FCMB Bank, said: “The loan will be largely dedicated to funding infrastructural development, and the growth of small & medium enterprise (SME) portfolio, while a portion will also be used for energy efficiency and renewable energy finance. Partnering with IFC will help us tap into IFC’s global expertise to help finance cost-efficient and cleaner energy solutions in Nigeria, increase access to finance for more SMEs, and further strengthen our infrastructure portfolio.

Solomon Adegbie-Quaynor, IFC country manager for Nigeria, said: “One of IFC’s key priorities in Nigeria is strengthening the country’s infrastructure, especially power, so homes and businesses can benefit from lower costs and more reliable power supply. Our partnership with FCMB aims to boost private investment in infrastructure and green energy projects, helping businesses become more productive and competitive. The overall goal is to increase employment opportunities and economic growth.”

The World Bank has identified a lack of reliable power-generating capacity as a major constraint to economic development in Africa, including in Nigeria, where millions face limited access to electricity.

IFC’s strategy for Nigeria is to support infrastructure development and increase access to finance for small and medium enterprises which are important job generators and engines of economic growth.