Dhaka, Bangladesh, October 22, 2020 —IFC is helping to preserve thousands of jobs in Bangladesh through an investment in Prime Bank Limited to support small and medium enterprises (SMEs) and companies affected by the COVID-19 pandemic. A $35 million loan from IFC to Prime Bank will provide critical working capital to help SMEs continue their operations.
SMEs comprise over 90 percent of businesses in Bangladesh and employ over 20 percent of the adult population.
The financing package is part of IFC’s $8 billion global COVID-19 fast-track financing facility , aimed at helping companies stay afloat during the ongoing public health crisis. This investment comes under the Working Capital Solutions (WCS) program of the COVID-19 response envelope, which provides $2 billion globally to emerging-market banks, enabling them to support struggling firms. The International Development Association’s Private Sector Window (IDA PSW) Blended Finance Facility is also supporting IFC’s WCS program with a first-loss guarantee of up to $215 million in eligible countries, including Bangladesh.
“This new investment from IFC will allow us to extend critical working capital, trade finance and forex liquidity to affected businesses,” said Rahel Ahmed, Managing Director and CEO of Prime Bank. “This fresh fund injection will enable us to lend a helping hand, particularly to export and import-based SMEs and other corporate clients, and thousands of suppliers and employees who depend on these businesses.”
Prime Bank has been an IFC client since 2014. Prime Bank is one of the leading private-sector commercial banks in Bangladesh.
“This is an unprecedented crisis that the world is facing and we need all hands on deck to navigate the public health crisis and the resulting economic challenges,” said Rosy Khanna, IFC Regional Industry Director, Financial Institutions Group – Asia and Pacific. “Small and medium enterprises are key not just in terms of overall contribution to GDP but also in terms of job creation—and the impact of the pandemic on them has to be addressed.”
About IFC
IFC—a member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2020, we invested $22 billion in private companies and financial institutions 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 .
About the IDA Private Sector Window
As part of the record $75 billion IDA18 replenishment, the World Bank Group created the $2.5 billion IDA Private Sector Window to catalyze private sector investment in the poorest and most fragile countries. Recognizing the key role of the private sector in achieving IDA18 objectives and the Sustainable Development Goals, the window provides concessional funds for co-investment alongside IFC and Multilateral Investment Guarantee Agency (MIGA) private investments. Concessional funds help to mitigate risk and reduce barriers, which unlocks and crowds in private investment in emerging markets. For more information, visit: https://ida.worldbank.org/psw
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