AfDB grants $325 million line of credit to Angolan bank
It will allow BPC to expand its loan portfolio.Angolan bank Banco de Credito e Poupança (BPC) is to receive a line of credit worth $325 million from the African Development Bank (AfDB) to support its development.
This funding will allow PBC, Angola's third largest bank in terms of assets, to expand its portfolio of loans to the tune of $800 million over the next five to seven years, the AfDB said in a statement.
The bank will mainly target medium-sized enterprises and large corporations in some priority areas such as water, agriculture and industry.
In addition, the AfDB will help BPC establish an Environmental and Social Management System (ESMS) and upgrade its risk management system.
"BPC needs long-term financing to better meet the needs of entrepreneurs and also to improve the management of its balance sheet. The loan will help to decrease by nearly 20 per cent the cost of BPC's resources in dollars," said Stefan Nalletamby, head of AfDB's department for the development of the financial sector.
The Angolan banking sector has experienced strong growth in recent years, which has fostered the emergence of new entrepreneurs and SMEs in non-oil sectors.
According to AfDB, these sectors urgently need funding, which they struggle to secure due to a risky business environment, along with the poor quality of collaterals and the scarcity of medium and long term funding sources.