IFC, a member of the World Bank Group, will provide a trade finance facility of up to $5 million to Nepal Investment Bank that will enable the bank to enhance its support for local enterprises and help boost international trade opportunities.
IFC’s trade finance facility will provide Nepal Investment Bank with risk coverage in a difficult market and access to a global network that will help grow its trade finance business. The network facilitates transactions in challenging markets, promotes competitive financing, and builds correspondent bank relationships with new institutions at low risk.
Nepal Investment Bank’s Chairman and Chief Executive Officer, Prithvi Bahadur Pande and IFC Resident Representative in Nepal, Rajeev Gopal, signed the Memorandum of Understanding that will help boost Nepal’s international trade opportunities.
“By joining IFC’s Global Trade Finance Program, we will be recognized by a wider range of correspondent banks globally. It will become easier for us and our clients to complete international transactions,” said Deepak Kumar Shrestha, Head of International Banking and Trade Finance at Nepal Investment Bank.
The global economic crisis and reduced trade financing had posed a particular economic risk to low- and middle-income countries. IFC, working with its partners, has sharply increased its trade financing efforts over the past two years.
Per Kjellerhaug, IFC Regional Manager for Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka, said, “IFC’s trade finance support to Nepal Investment Bank will enable the country’s corporate and small and medium enterprise sector to increase their share of global trade.”
Prior to this facility, IFC has supported three other banks with trade finance in Nepal. Since 1975, IFC has committed over $80 million in nine projects in Nepal. Currently, IFC has an exposure of over $35 million in the country in equity, debt, and guarantees, with exposure to private infrastructure exceeding $28 million. In FY09, IFC committed more than $10 million in new investments in Nepal.
To learn more about IFC’s activities in South Asia, visit www.ifc.org/southasia.
About IFC
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing capital for private enterprise, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.5 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit www.ifc.org.
About Nepal Investment Bank Limited
Nepal Investment Bank has 39 branches and 60 ATMs (150 ATMs including consortium member ATMs) in Nepal. It is the largest private sector bank in the country and has market share of about 8 percent in terms of deposit base and 10 percent of total advances as of mid-July 2009. The bank’s leadership in underwriting international finance transactions is well recognized. For more information, visit www.nibl.com.np.
