Johannesburg, South Africa, September 1, 2020 – IFC, a member of the World Bank Group, today announced a loan to FirstRand Bank Limited to enable increased financial and advisory support to energy-efficient and water-smart projects in South Africa, helping the country meet climate emission and other environmental targets.
FirstRand will use the funds to finance green projects for its South African corporate and SME clients and to support climate and water smart infrastructure, agriculture, and manufacturing initiatives in the country. The $225 million loan includes $75 million from the Dutch entrepreneurial development bank (FMO).
The transaction is part of IFC’s broader objective to develop South Africa’s climate finance market and to support the Government of South Africa’s plan to shift to a lower carbon economy. South Africa has set the goals of reducing greenhouse-gas emissions by 42 percent by 2025 and diversifying its electricity production away from coal by 2050.
Andries du Toit, FirstRand’s Group Treasurer, said, “This transaction will provide FirstRand with valuable additional capacity to enable the group to assist our clients participating in the growth of South Africa’s green economy.”
Adamou Labara, IFC’s Country Manager for South Africa, said, “Supporting increased access to green and blue financing is critical to fostering a more inclusive, resilient, and sustainable response to growing climate risks on economic development. Our partnership with FirstRand is especially important now as South African businesses recovering from the COVID-19 crisis look to develop sustainable projects.”
IFC will support its investment with technical assistance in the areas of impact monitoring, water stress management, and other sustainability-linked solutions for clients looking to reduce their carbon footprints.
Supporting financial institutions to expand access to green financing is critical to a successful transition in South Africa, as commercial banks currently provide 45 percent of the financing for renewable energy and energy-efficient projects.
About IFC:
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work with more than 2,000 businesses worldwide, using our capital, expertise, and influence to create markets and opportunities where they are needed most. In fiscal year 2019, we delivered more than $19 billion in long-term financing for companies in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org .
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About FMO
FMO is the Dutch entrepreneurial development bank. As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development and has a 50-year proven track-record of empowering people to employ their skills and improve their quality of life. FMO focuses on three sectors that have high development impact: financial institutions, energy, and agribusiness, food & water. With a committed portfolio of EUR 10.4 billion spanning over 80 countries, FMO is one of the larger bilateral private sector developments banks globally. For more information: please visit www.fmo.nl .
About FirstRand
FirstRand Bank Limited is a wholly owned subsidiary of FirstRand Limited, which is listed on the Johannesburg Stock Exchange (JSE) and the Namibian Stock Exchange (NSX). FirstRand Limited is one of the largest financial institutions in Africa by market capitalization. It provides a universal set of transactional, lending, investment, and insurance products and services through a portfolio of leading financial services businesses comprising FNB, RMB, WesBank, Ashburton Investments and Aldermore . In addition to South Africa, the group operates in nine key African markets, the UK, and India.
Contacts
In Johannesburg Devon Maylie +27 83 782 9912 dmaylie@ifc.org
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