Kenya’s Co-op Bank raises $100mn to expand capital base
The Co-operative Bank of Kenya has raised a total of $100mn (KES12.6bn) in long-term debt from global institutional investors led by the German fund DEG to expand its capital base, according to Norwegian fund Norfund, one of the institutions participating in the financing.
Channelled through the European Financing Partners – a joint venture between the European Investment Bank (EIB) and several European funds – it is meant to facilitate the Co-op Bank expanding its capital base for lending and capital, according to Business Daily.
Norfund participated with a direct credit line of $16mn (KES2bn) and another $3.4mn (KES430mn) through the European Financing Partners.
“The funds will strengthen the bank’s capital base, support lending to MSME and position the bank for future growth. Co-op is the third largest bank in Kenya, 65 per cent owned by local co-operatives and the largest co-operative bank in Africa,” Norfund said.
By the end of 2021, Co-op Bank had outstanding long-term borrowings from a number of institutions, such as the International Finance Corporation (IFC) and French development agency AFD worth KES19.6bn.
The lender said in its latest available annual report that most of these funds were used to provide credit in areas spanning renewable energy, mortgages and agribusiness.