British CDC to invest US$ 200 million in BMCE Bank of Africa
UK’s development finance institution CDC Group will acquire an equity stake of 5% in BMCE Bank of Africa through a primary capital injection of US$ 200 million, the two groups said in a press release.
CDC’s investment will help accelerate BMCE’s expansion across Africa while also allowing the Bank to leverage CDC’s wide in-country networks, it added.
As one of the seven major pan-African groups, BMCE has established an outstanding track record in sub-Saharan Africa. Back in the late 1980s, BMCE successfully turned around the state-owned bank "la Banque de Développement du Mali" and, in 2003, it restructured "La Congolaise de Banque", the first commercial bank in Congo Brazzaville.
In 2008, the acquisition of "Bank of Africa", a banking group present in 17 sub-Saharan African countries, and in which BMCE owns a controlling stake of 73%, has spurred international growth.
Today, sub-Saharan Africa operations account for nearly half of BMCE’s net earnings. By leveraging on its extensive footprint, the Bank aims to create value for the continent by routing international investments from its hubs in Morocco, Europe and Asia, and by bringing innovative retail banking solutions to Africa.
CDC has over 70 years of experience investing in Africa and in Asia, with more than 700 businesses in its African portfolio. CDC is strongly committed to the continent and plans to invest up to US$ 4.5 billion in Africa by 2022, across different sectors and through various investment solutions.
CDC invests in financial institutions to advance financial inclusion and bring better access to affordable finance for individuals and SMEs, helping them to strengthen their communities.
This strategic partnership between BMCE and CDC represents one of the largest single investments by a British institution in the Moroccan financial sector and it is a testimony to their joint vision and commitment to strengthening Africa’s economy and improving people’s lives.
The access to affordable and innovative finance, financial education and business advice is essential to ensure economic development, especially for SMEs, which constitute the backbone of Africa’s economy and are a key driver of economic growth. As these businesses grow, they create jobs and wealth in their communities.
The promotion of environmentally sustainable development is an important component of the partnership. BMCE and CDC recognize that sustainable development can serve as a driver to enhance economic growth in African economies and empower African societies. As part of their work in this area, BMCE and CDC seek to ensure environmental and social risks are taken into consideration at the transaction level and work with companies to help them incorporate sustainable practices in their business operations.
“The ultimate goal of our agreement goes beyond the US$ 200 million investment,” said Othman Benjelloun, Chairman and CEO of BMCE Bank of Africa. “Rather, it is an alliance aimed at developing Morocco and Africa and ensuring that Africa’s human capital achieves a sense of fulfilment”.
“Investing in financial institutions is a powerful mechanism through which we can deliver impact at scale,” said Nick O’Donohoe, CEO of CDC Group.
“The capital markets in countries such as Morocco are integrated across Africa and are critical to the success of more economically challenged environments in the region. We see these countries as regional hubs, strong platforms from which to provide affordable finance, goods and services to millions more people. Our support will allow the Bank to grow its offering, especially in the SME segment, deepen penetration of banking services and promote financial inclusion for all,” he pointed out.
BMCE Bank of Africa is today the most internationally oriented Moroccan banking group with a presence in 31 countries throughout Africa, Europe, Asia and North America, employing more than 15,200 employees around the world, with more than 1,675 branches serving nearly 6.6 million customers.
The Bank is also a major player strongly involved in environmental, 14 001 certified, and social responsibility matters, namely through its Medersat.Com program that promotes education and community development in rural areas in Morocco and Sub-Saharan Africa, as well as through the offer of innovative sustainable financing programs and products in partnership with major international financial institutions.
Wholly owned by the UK Government, CDC Group invests in Africa and South Asia with the aim of supporting economic development to create jobs. CDC Group plc has invested in Africa since its establishment in 1948 and has net assets of £5.1 billion. CDC takes a flexible approach and provides capital in all its forms, including equity, debt, mezzanine and guarantees, to meet businesses’needs and achieve development impact.
MAP 19 June 2019