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| This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. |
Summary of Project Information (SPI) |
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| Project number | 10855 |
| Project name | Algeria Trade Enhancement Facility |
| Country | Algeria |
| Sector | Finance & Insurance |
| Department | Global Financial Markets Group |
| Company name | Algeria Trade Enhancement Facility |
| Environmental category | C |
| Date SPI disclosed | October 2, 2001 |
| Projected board date | November 5, 2001 |
| Status | Completed |
| Previous Events | Signed: April 9, 2002
Approved: December 3, 2001 |
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| Project sponsor and major shareholders of project company |
BNP Paribas Paris (BNPP) employs 77,000 staff in 87 countries in the world. BNPP is the leading listed banking group in France, the third largest banking group in market capitalization (Euro 41.2 billion) in the Euro zone and the fourth largest banking group in Europe in terms of net worth (Euro 20 billion). Present in over 20 countries for private banking and asset management, BNPP also ranks third in France for life insurance, and is the European leader and one of the top 10 operators worldwide for custody services. BNPP is also number two in France for public mutual funds, holding more than 10% of the market.
In 2000, BNPP reported a consolidated net income of Euro 4.1 billion, representing a 26.3% increase over 1999 results and an ROE of 20.9% as compared to an ROE of 17.1% in 1999. As of December 31, 2000, BNPP's long term debt was rated Aa3 by Moody's, AA- by Standard & Poor's and AA- by FITCH IBCA. |
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| Total project cost and proposed IFC investment |
| The total facility amount is US$40 million. IFC's investment consists of a guarantee to BNPP of up to US$20 million or up to 50% of the proposed facility. |
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| Location of project and description of site |
| The project is located in Algiers, Algeria. Eligible banks are Arab Banking Corporation Algeria, Crédit Populaire d'Algérie and Compagnie Algérienne de Banque. |
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| Description of company and purpose of project |
The project consists of establishing a three-year facility in association with BNPP to confirm Letters of Credit (L/Cs) originated by selected commercial banks in Algeria for the benefit of private local businesses. The main objective of the facility is to lengthen the tenor of the L/C facilities available in the market in order to meet part of the financing needs of eligible Algerian private sector entities. The facility will provide local commercial banks with access to confirmation of L/Cs with tenors of up to 24 months.
The facility would be structured as a risk-sharing arrangement between IFC and BNPP, whereby IFC would counter-guarantee half of the exposure of BNPP under the facility. IFC would share equally with BNPP the credit risk of the local banks that are eligible to use the facility and has the ability to suspend, cancel or reduce the credit limit of any bank. |
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| Environmental and social issues - Category C |
This is a Category C project, according to IFC’s Procedure for Environmental and Social Review of Projects, because it is likely to have minimal or no adverse environmental impacts.
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| To contact the project company, please write to: |
Gerard Clouet, Head, Africa, Middle-East and DOM-TOM, Global Trade Services
Fax 33 1 42 98 38 98
BNP Paribas
37 Place du Marché Saint Honoré
75031 Paris Cedex 01, France |
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