ABSA, one of South Africa’s largest banks, has this week signed a deal worth US$100 million with China Development Bank (CDB), a Special Facility Agreement meant to provide funding to Small and Medium Enterprises (SMEs) operating on the continent.
Johannesburg-based ABSA is a subsidiary of the Barclays Africa Group Limited (BAGL). Barclays Africa is present in 12 countries in Africa.
The deal, which is said to be the first major transaction between the two lenders, will also benefit Barclays Africa’s existing and prospective SME clients where it operates across continent.
The initial drawdown is based on ABSA’s current funding needs, and may be increased in the future to assist with new funding opportunities within BAGL’s operations, reports from Johannesburg and Beijing said on Thursday.
“We are glad to partner with CDB on this landmark transaction, which also echoes the 2017 BRICS theme, ‘Stronger Partnership for a Brighter Future’ ”, Craig Bond, Barclays Africa head of partnerships, joint ventures and strategic alliances, said in a statement.
Founded in 1994, China Development Bank is one of the continent’s biggest lenders and a vital institution for foreign investment. Its assets are estimated at about of US$$2 trillion.