This archive report was first published on 4 January 2022.
On January 4, 2022, Equity Group Managing Director and CEO Dr. James Mwangi announced the acquisition of a US$ 165 million loan from the International Finance Corporation (IFC) to support the bank's small and medium-sized enterprise (SME) clients in Kenya.
The loan, valued at Ksh18.6 billion, is one of the single-largest credit facilities to a Kenyan lender and will help Equity Group increase working capital and trade-related lending to its SME clients, particularly those facing COVID-19 related challenges.
According to Dr. Mwangi, the loan is part of the bank's business continuity management plan and will help Equity Bank extend much-needed support to its clients, particularly SMEs in sectors hit hard by COVID-19.
IFC will directly provide US$ 50 million, with the remaining US$ 115 million coming from partners. The loan is part of IFC's global $8 billion fast-track COVID-19 facility, announced in March, designed to help businesses maintain operations and jobs during—and after—the COVID-19 pandemic.
IFC's loan will also support Equity's lending towards Climate Smart Projects and the local SME sector, which was hard hit by the Covid-19 containment measures. The facility will partly support hundreds of Kenyan businesses in the manufacturing, health, trade, transport, and consumer goods sectors.
Additionally, IFC is set to become the bank's second-largest shareholder after signing an agreement to purchase insurance firm Britam's stake in the lender. The institutional investor will buy 253.1 million shares of the bank from Britam at Ksh55 each.
