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Mashreq taps BII for South Asia and Africa-focused trade finance facility: Our friends at Mashreq struck a master risk participation agreement for a USD 50 mn trade finance facility with British International Investment (BII) to support cross-border trade across emerging markets in South Asia and Africa, according to a statement (pdf). The agreement is the first of its kind between a Middle East-based bank and BII.
Uh, Enterprise, what’s a risk participation agreement? Banks enter into this type of agreement when they want to share risk on certain transactions — especially in trade finance and syndicated loans. They do so by selling part of their exposure in a transaction, with the participant in return getting a piece of the returns — whether in the form of interest or fees.
The details: The facility will allow Mashreq to “strengthen [its] capacity to provide trade finance to clients in West Africa and South Asia, ensuring faster response times and better client support,” the statement said.
The bank will first focus on trade finance prospects in Angola, Bangladesh, Benin, and Ivory Coast, before expanding into additional countries over the coming year, the statement said. The facility will help address the gap in financing for imports of critical goods to these countries, it added.
OTHER DEBT NEWS-
Dubai-based mass transit app Swvl obtained a sustainable credit facility from HSBC to expand its pipeline of client contracts in 4Q 2024, according to a statement. The mobility solutions provider sold USD 4.7 mn in ordinary shares to investors in a private placement last week to support its expansion to the US next year. It also secured USD 4.2 mn in contracts across Egypt’s mobility sector during the past three months.
