German bank signs $10m facility with Fidelity Bank to support Ghanaian SMEs

The German development investment bank, DEG, has signed a $10 million with Fidelity Bank to help the Ghanaian bank to meet the growing financial needs of small and medium-scale enterprises (SMEs).

The senior loan facility, which matures in five years, will enable the indigenous universal bank with enviable track record to provide medium term financing for SMEs in agri-business, telecommunications, commercial infrastructure as well as projects in oil and gas.

The Deputy Managing Director of Fidelity Bank, Mr Jim Baiden, signed on behalf of Fidelity while DEG Director for Africa, Mr Karl Weinfurtner, also initialled on behalf of DEG.

Mr Baiden said at the signing ceremony on Friday that the facility from DEG had come in handy as the bank had received long request for medium to long term financing which the bank could not meet using short term funds.

He said Fidelity Bank was a dynamic bank that had achieved a lot in five years since it became a universal bank and it was on course to be counted among the top five banks in the country by 2015.

“In doing this, there is the need to support the small and medium enterprises and other businesses with the appropriate type of funds and avoid mismatching financing.

For his part, Mr Weinfurtner expressed the hope for a lasting partnership with Fidelity saying DEG had a lot to offer businesses in Africa but could not do so directly but through credible banks, such as Fidelity.

“We would like to expand our portfolio in Africa and Ghana but the missing link is suitable SMEs that can access the facility. We also need credible partner banks like Fidelity to loan to the SMEs,” Mr Weinfurtner stated.

With this latest facility, DEG’s portfolio in Ghana has reached $36 million, with a couple of others yet to be signed before the end of the year. Officials are hoping for enterprises to posture appropriately to access the long to medium term financing from DEG.

Mr Weinfurtner regretted that the development financier was finding it difficult in financing manufacturing concerns.

The DEG West Africa Regional Director, Mr Andreas Voβ, reiterated that DEG was committed to growing its portfolio in the region and Ghana, expanding its partnerships to increase growth in the country.

“For the economy to sustain the remarkable growth it has recorded, it is important to have a strong private sector and companies to contribute to the growth and help sustain it,” Mr Voβ,  stated.

Source: Daily Graphic

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