British International Investment

Access Bank Plc

West AfricaFinancial services

The bank is a systemically important financial institution in Nigeria.

Our investment

Description of the investment.

The syndicated loan facility was led by FMO and includes other DFIs and impact investors such as DEG, Finnfund, Norfund and Blue Orchard Microfinance Fund. The tier II facility enables Access Bank to raise long-term capital, which is difficult to attract in the commercial market amid the country's recent recession and elections.

Impact information

Applies to investments made from 2019 onwards. The tabs in this section define what we expect to achieve through the investment, assessing the potential impact of the investment against six dimensions of impact. You can find more details on our methodology of assessing impact here.

What?

Impact
  • Improve economic opportunities through increasing the availability of trade finance for businesses (SDG 8.1, 8.5 and 8.10).

  • Increase access to commodities and goods for businesses and consumers (SDG 9.1 and 9.2).

How?

How?
  • Economic enabler: The $60 million trade loan will allow the bank to extend more foreign currency trade loans to importers/exporters and increase trade volumes in Africa, enabling business to sustain operations and market output. This will ultimately lead to job and livelihood preservation.

  • Economic enabler: The increased access to US dollar denominated loans will increase the ability of businesses to import goods which will ultimately contribute to the continued availability of goods for consumers.

Who?

Stakeholder Geography Characteristics
We have no visibility on ultimate stakeholders. They will likely include employees of importers and exporters who will benefit in terms of their job/livelihood preservation, as well as consumers who will benefit from improved access to goods from the increased trade flows.

This trade loan will be used in DRC, Zambia, Mozambique, Sierra Leone and Rwanda.

There is no visibility on the characteristics of people reached. Employees will be workers of importers and exporters. The largest borrowing sectors in the pipeline of the subsidiaries in target markets include construction, manufacturing, fast moving consumer goods, beverage production amongst others.

How much?

Scale Depth/Duration

We use trade volumes enabled as a proxy for scale. We anticipate that our $60 million trade loan will lead to increased trade volumes of approximately $90 million.

  • Duration: One year loan with possible extension.

  • Depth: The World Bank recently adjusted growth projections for Africa downward from 2.4 per cent in 2019 to -2.1 to -5.1 per cent in 2020. As a result, impact is expected to be deeper in a context where the counterfactual has worsened (i.e. unemployment and lower access to goods).

Contribution/additionality

Contribution/additionality
  • Financial additionality: Commercial funding is not available in sufficient quantity for on-lending to the bank's subsidiaries, especially in the smaller and less-developed markets.

  • Value additionality: As part of the Environmental & Social Action Plan (ESAP), we will support the improvement of the bank's Human Resources policies.

Risk

Execution Risk

This relates to the bank's ability to originate and effectively underwrite trades in 'Alpha countries'. However, we explored each subsidiary’s pipeline of trade loans and capabilities during due diligence and are confident that there is sufficient demand.

Evidence Risk

We have limited visibility on the ultimate impact on employees and consumers given the intermediated nature of the facility. This is mitigated by monitoring data on underlying trades, country, sector and size of enterprise.

Impact score

Impact score (at point of investment)

The Impact Score is a tool to help us manage our performance against our strategic impact objectives. It is designed to incentivise investments that support our productive, sustainable, and inclusive objectives. You can find out more here.

The Impact Score is published for investments made from 2022 onwards. The Impact Scores are calculated at the point of investment. We publish the Impact Scores of new investments annually, once the information has been externally assured by an independent third party.

8

Environmental and social information

  • Environmental and social summary

    A high-level description of the environmental and social aspects of the investment. This may include a summary of key environmental and social risks identified during environmental and social due diligence (ESDD); key elements of an environmental and social action plan (ESAP); or ways in which we plan to support the investee improve environmental and social standards, such as through their environmental and social management system (ESMS); as well as any other priority areas agreed with the investee.

  • Environmental and social risk

    A risk category rating, which indicates the level of environmental and social risk associated with an investment. For an explanation of the categorisations used, see here. We consistently provide an environmental and social risk category for all investments screened from 2023 onwards.

Environmental and social summary

BII will support Access Bank to further strengthen its ESMS and human resources policies and procedures.

Reporting and Complaints Mechanism

The Reporting and Complaints Mechanism allows anyone outside BII to report alleged breaches of the business integrity or environmental and social provisions of BII’s Policy on Responsible Investing. This includes breaches made by BII, a BII investee, or a portfolio company of a fund in which BII has invested. The Reporting and Complaints Mechanism Rules are available here. Reports and complaints can be submitted by email to [email protected] or by mail. See more details on our Reporting and Complaints Mechanism here.

For any other general enquiries contact us at [email protected]

  • Key facts

    First published

    When the investment was first published on the website database.

    :
    October 2023
    Last updated

    When the last quarterly update of the website database occurred.

    :
    June 2024
    Project number

    An identifier number shared by investments in the same project.

    :
    D5714
    Status

    The current status of the investment (green flag for active and red flag for exited).

    :
    Active
    Region

    The geographical region where the country is located. We currently invest in Africa, South Asia, South East Asia and the Caribbean. In 2023, BII’s investment mandate was extended allowing it to invest in regional funds linked to Ukraine, with the majority of activity expected to begin post-war. Investments outside these regions were made prior to 2012 under previous investment mandates.

    :
    West Africa
    Country

    The countries where the investment delivers impact. Where impact is delivered in multiple countries, this is indicated.

    :
    Democratic Republic of Congo, Mozambique, Rwanda, Sierra Leone, Zambia
    Sector

    We prioritise those sectors that facilitate development and need our capital the most. Our priority sectors contribute towards many of the Sustainable Development Goals. They range from investing in the power infrastructure that will provide people with better access to electricity, to investing in financial institutions that direct capital to the individuals and businesses that need it the most.

    :
    Financial services

    We provide capital in the following ways: directly – through direct equity, direct debt, guarantees and other non-intermediated financial instruments; and indirectly – principally through investment funds.

    For direct investments and fund investments, this is the date BII committed capital to the investments. This is typically the date on which legal agreements are signed by all parties.

    For the portfolio companies of our fund investments, this is the date (either the month or the quarter) on which the fund committed capital to the portfolio company.

    For direct equity investments, this is the date at which British International Investment exited the investment.

    For debt investments, this is the date at which the final debt repayment was made.

    For funds, this is the date at which the fund was terminated.

    For underlying fund investments, this is the date at which the fund manager exited the investment.

    The total amount committed, per financial instrument, per investment, on the date BII becomes subject to a binding legal obligation to provide funding or assume a contingent liability. This information is provided in US dollars.

    For direct investments, this is the amount that BII has committed to the business or project. For fund investments, this is the amount BII has committed to the fund.

    The currency in which the investment was made.

    Investment type :
    Debt
    Start date :
    May 2023
    Amount :
    $60m
    Currency of investment :
    USD
    Domicile

    The company or investment fund’s place of incorporation.

    :
    Nigeria
    2X Gender Finance

    Indicates whether the investment is ‘2X qualified’ using the 2X Challenge criteria. You can find out more here. It only applies to investments made from 2018 onwards, when the 2X Challenge was first launched.

    :
    Partially qualified

Related investments made by BII into this company:

Investment name Commitment Region Sector Start date Status
Investment 01 $25m West Africa Financial services January 2019 Exited

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