Washington D.C., February 16, 2006—The
International Finance Corporation, the private sector arm of the World
Bank Group, has concluded the first transaction in Bangladesh under its
Global Trade Finance Program.
The transaction supports the confirmation by American Express Bank of a
letter of credit issued by Dhaka Bank, for importing of cotton into Bangladesh.
IFC’s guarantee provided 100 percent risk coverage and enabled the transaction
to proceed quickly and efficiently at commercial pricing, benefiting the
importer as well as both banks.
Per Kjellerhaug, IFC’s Regional Representative, said, “This transaction
demonstrates IFC's commitment to facilitating cross-border trade and to
supporting vital industries in Bangladesh.”
The Global Trade Finance Program is a $500 million program to support trade
with emerging markets worldwide and to promote the flows of goods and services
between developing countries. IFC provides guarantee coverage of bank risk
in emerging markets, allowing recipients to expand their trade finance
transactions within an extensive network of countries and banks as well
as to enhance their trade finance service to their clients.
Mr. Mohammad Abu Musa, Deputy Managing Director of Dhaka Bank, said “We
are delighted to be the first issuing bank in Bangladesh to use IFC’s
Global Trade Finance Program. We look forward to using this program
to increase our transaction volume and serve our clients better.”
John Ruane, American Express Bank ‘s global trade banking head, said,
“Our partnership with IFC’s Global Trade Finance Program will enhance
our trade finance business worldwide as well as complement our ability
to provide efficient trade solutions to our customers.”
Priyamvada Singh, IFC’s South Asia trade specialist, said, “IFC’s program
combines global reach and maximum flexibility to accommodate the trade
needs of banks—both the confirming and the issuing institutions.”
Dhaka Bank was established as a public limited company in 1994 and began
commercial operations in July 1995. This midsize bank has a strong focus
on trade finance products for corporate as well as small and medium enterprise
clients. It has 28 branches across the country and a wide network of correspondents
around the world.
The International Finance Corporation is the private sector arm of the
World Bank Group and is headquartered in Washington, D.C. IFC coordinates
its activities with the other institutions of the World Bank Group but
is legally and financially independent. Its 178 member countries
provide its share capital and collectively determine its policies.
The mission of IFC is to promote sustainable private sector investment
in developing and transition countries, helping to reduce poverty and improve
people’s lives. IFC finances private sector investments in the developing
world, mobilizes capital in the international financial markets, helps
clients improve social and environmental sustainability, and provides technical
assistance and advice to governments and businesses. From its founding
in 1956 through FY05, IFC has committed more than $49 billion of its own
funds and arranged $24 billion in syndications for 3,319 companies in 140
developing countries. IFC’s worldwide committed portfolio as of FY05 was
$19.3 billion for its own account and $5.3 billion held for participants
in loan syndications. For more information, visit www.ifc.org.