British International Investment

City Bank Ltd.

South AsiaFinancial services

City Bank is one of Bangladesh’s top performing private banks.

This investment was made when British International Investment was named CDC Group.

Our investment

Description of the investment.

British International Investment provided City Bank Bangladesh with the trade loan with the aim of financing US dollar trade transactions for businesses in Bangladesh by providing liquidity to the bank. This was the first time we provided trade finance directly to a local issuing bank; and enabled exports as well as imports.

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

Improved economic opportunities through increasing the availability of trade finance for businesses (SDG 8.1, 8.5, 8.10, 9.2)

How?

How?

Economic enabler: We provide a $50 million trade loan to City Bank to allow the bank to extend more foreign currency trade credit to importers and exporters, sustaining and potentially increasing trade volumes in and out of Bangladesh. This will enable businesses to export goods and import the commodities, business inputs and capital equipment they need to sustain operations and market output. This will ultimately lead to GDP contribution, job/livelihood preservation and the continued availability of goods and services for consumers.

Who?

Stakeholder Geography Characteristics
Employees and suppliers of importers/exporters

Bangladesh

Employees will be high/medium/low-skilled workers of importers and exporters, likely in the garment industry and manufacturing.

How much?

Scale Depth/Duration

We use the scale of the facility and enabled trades as a proxy: this commitment is expected to enable up to $100 million in additional trade volumes per year.

  • Duration: One year with potential for extension.
  • Depth: The World Bank has recently adjusted its GDP growth projections for Bangladesh for 2020-21 downward by approximately 5 - 6 per cent compared to projections made pre-COVID-19. As a result, impact is expected to be deeper in a context where the counterfactual has worsened (i.e. higher rates of unemployment and lower access to goods in the market).

Contribution/additionality

Contribution/additionality
  • Financial additionality: Commercial funding is not available in sufficient quantity nor on the same terms.

Grid score

Grid Score

To help us direct our investments, we previously used a tool called the Development Impact Grid. It scored investments out of four, based on two factors: the difficulty of investing in a country and the propensity of the sector to generate employment. This tool was used for investments until the end of 2021. Since 2022 it has been replaced by the Impact Score.

3.0

Risk

Evidence Risk
  • Limited visibility on the ultimate impact due to the length of the impact chain.

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

    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.

    :
    D4437
    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.

    :
    South Asia
    Country

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

    :
    Bangladesh
    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 :
    April 2021
    Amount :
    $30m
    Currency of investment :
    USD
    Domicile

    The company or investment fund’s place of incorporation.

    :
    Bangladesh

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