InfraCredit aims to support up to $1.25 billion in infrastructure after approval from AFDB.
Africa development bank (AFDB) has approve US$15 million for investment package to infrastructure Credit Guarantee Company (InfraCredit). The fund will be use to help support infrastructure financing through the domestic debt capital markets in Nigeria.
InfraCredit is a specialized infrastructure credit guarantee company that is focus on enhancing credit local currency debt instruments – mainly bonds. It is use to uplift the credit rating of such bonds, allowing institutional investors to include them in their portfolios.
The package will comprise of a subordinated loan of US$10 million and a risk sharing facility of up to US$5 million. This also help in promoting local currency infrastructure financing, and further development of the domestic capital market.
Bank’s Director of the Financial Sector Development, Stefan Nalletamby said “The Bank’s support will strengthen the capital base of InfraCredit. He said by underpinning the expansion of the Company’s core business of guaranteeing of bonds issued to fund infrastructure projects.”
According to Stefan, it will add to the bank Bank’s existing initiatives. This initiatives is to mobilize domestic institutional savings and stimulate non-sovereign local debt capital market development in Nigeria.
The InfraCredit’s operations will catalyze infrastructure investments in critical sectors. This sectors include; renewable energy, housing, transportation, agricultural infrastructure, and telecommunications, which are critical for the country’s economic development.
InfraCredit will increase private sector financing for critical infrastructure projects in key sectors including energy, agriculture, water, health and education, through local capital markets.
InfraCredit aims to support up to $1.25 billion in infrastructure financing over the next few years. This will involving the private sector in infrastructure financing, essential to Nigeria’s economic resilience.