The CDC Group, the United Kingdom government’s development finance institution, has announced a $25 million loan to Global IME Bank Ltd, one of the largest commercial banks in Nepal.
The CDC, which is soon becoming British International Investment, said its commitment will enhance the bank’s ability to provide credit to businesses across key economic priority sectors and stimulate economic opportunities throughout the country.
The facility will also help address funding gaps in the market by strengthening the bank’s capacity to increase lending to businesses in key economic sectors, such as infrastructure, construction, manufacturing, agriculture, and tourism.
“This much-needed capital will enable the bank to offer financial support to more businesses, enhancing their ability to navigate post-Covid recovery and create jobs that will facilitate sustained inclusive growth across all segments of society in Nepal,” according to the statement issued by the bank.
The CDC said that the loan will amplify the bank’s plans to broaden its offer to key sectors, including renewable energy and tourism sectors, classified by the government of Nepal as priority sectors for the country. The bank’s goal to provide local and foreign currency longer-term lending to businesses within these sectors and others aligns with CDC’s ambition to increase green finance and help scale clean energy and infrastructure projects across its markets, including in key countries like Nepal.
Srini Nagarajan, Managing Director, Head of Asia, at CDC Group, said, “Nepal is a high priority country for CDC, and we’re pleased to partner with Global IME Bank, one of Nepal’s leading banks with deep sectoral expertise and extensive geographical footprint across the country. As our second direct financial services investment in the country, this facility reiterates our commitment to continue to support economic recovery and sustainable growth in Nepal.”
“Flexible and long-term capital is greatly needed to help drive the country’s green post-pandemic recovery, and it will ensure that local businesses have access to the finance they need to thrive,” said Nagarajan.
Ratna Raj Bajracharya, Chief Executive Officer at Global IME Bank Ltd, said, “We are pleased to announce our relationship with CDC Group, UK government’s international impact investor with over 70 years of experience of successfully supporting the sustainable, long-term growth of businesses in Asia and Africa.”
“As CDC Group has sanctioned a $25 million loan to Global IME Bank, our partnership and CDC’s commitment to us will enhance and bolster our lending capacity to businesses across key economic priority sectors, such as infrastructure, construction, manufacturing, agriculture, and tourism of the country,” said Bajracharya.
Nicola Pollitt, British Ambassador to Nepal, said, “The UK has been supporting Nepal’s transition to renewable energy as well as its efforts to build resilience to the impacts of climate change and on post-Covid recovery. CDC investment in Nepal’s financial institutions sits side by side with our efforts to build institutional capacity to receive climate finance and offer financial products that address market gaps, particularly for SMEs.”