IFC provides Prime Bank $50m to boost external trade 

The International Finance Corporation (IFC), World Bank's private sector lending arm, is providing $50 million to Prime Bank Limited to support Bangladesh's export and import-based businesses to cope with global uncertainties caused by the Covid-19 pandemic, said a press release.

The financing package is part of IFC's "Fast Track Covid-19 Facility" which has been designed to support countries and private sectors to cope with the impacts of the pandemic under the Working Capital Solutions programme.

"The support reflects the resilience of the Bangladesh economy and confidence in the Prime Bank. The IFC has been a valuable partner of Prime Bank since 2014 and this relationship helps us significantly expand our OBU business," Managing Director and CEO of Prime Bank Hassan O Rashid said.

"We are really thankful to IFC for its continued support. This fresh funding of $50 million targeted for SME clients will help us grow the SME portfolio further," he added.

Prime Bank, one of the leading private-sector commercial banks in Bangladesh, was awarded the "2021 Best Bank Partner for Equipment Trade in South Asia" by the IFC under its Global Trade Finance Program.

"It is clear that the impacts of Covid-19 are still being felt by a number of businesses in Bangladesh's key industries, effectively constraining their operating ability," said Allen Forlemu, regional industry director for Financial Institutions Group at IFC. 

"This funding package is designed specifically to help ensure businesses in Bangladesh can continue to trade and have access to working capital, helping them maintain operations and preserve jobs. Small and medium-sized businesses, which are the backbone of the country, and have been particularly impacted by the pandemic, are expected to benefit the most from this IFC funding," he added.  

With the latest financing, the IFC has provided a total of $310 million in working capital solutions to banks in Bangladesh and liquidity support to companies since the beginning of the pandemic crisis. Since 2010, IFC has invested over $3.6 billion in Bangladesh to help the private sector grow and create jobs, the release reads.

The new IFC fund will facilitate borrowings of export-import-based traders, especially to support their working capital, trade finance, and foreign exchange liquidity needs, through Prime Bank's offshore banking unit, it noted.

Commercial banks are the largest providers of working capital and foreign exchange trade finance support to manufacturing and infrastructure businesses, key drivers of Bangladesh's economy. Unexpected turbulence in the global markets because of the Russia-Ukraine war has restrained foreign exchange liquidity in the market. With this funding, Prime Bank is expected to extend loans to its export and import-based customers, helping keep businesses afloat, resume exports and preserve jobs, according to the press release.