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Overview

CDB provides $50 million loan to Equity Bank Kenya Limited for on-lending to SMEs

Commitments (Constant USD, 2023)$64,306,924
Commitment Year•2010Country of Activity•KenyaDirect Recipient Country of Incorporation•KenyaSector•Business And Other ServicesFlow Type•Loan

Status

Project lifecycle

Completion

Pipeline: PledgePipeline: CommitmentImplementationCompletion

Timeline

Key dates

Commitment date
May 16, 2010
Last repayment
Nov 28, 2014

Stakeholders

Organizations involved in projects and activities supported by financial and in-kind transfers from Chinese government and state-owned entities

Ultimate beneficial owners

At least 25% host country ownership

Funding agencies

State-owned Policy Banks

  • China Development Bank (CDB)

Receiving agencies

Private Sector

  • Kenya Equity Bank

Implementing agencies

Private Sector

  • Kenya Equity Bank

Loan desecription

CDB provides $50 million loan to Equity Bank Kenya Limited for on-lending to SMEs

Grant element•13.2593%Interest rate (t₀)•2.835%Interest type•Variable Interest RateLoan tenor•6-month rateMaturity•4.54 years

Narrative

Full Description

Project narrative

On May 16, 2010, China Development Bank (CDB) signed a $50 million (KES 4,308,000,000) loan agreement with Equity Bank Kenya Limited — a financial services provider headquartered in Nairobi, Kenya — to support the development of small and medium-sized enterprises (SMEs). The loan carried an interest rate of 6-month LIBOR plus a 2.2% margin and an 4.54-year maturity (final maturity date: November 28, 2014). The loan was backed by the Equity Bank Kenya Limited directors’ guarantee. The loan fully disbursed between 2010 and 2012 and it was fully repaid by 2014. The proceeds of the CDB loan were to be used by Kenya Equity Bank to on-lend to SMEs -- especially agro-processing SME exporters -- at interest rates of between 7% and 9% and maturities of 3-7 years. The CDB loan reportedly supported the Mataara Tea Factory Expansion Project, the Kapkoros Tea Factory Project, the Jetlink Logistics Project, among other projects.

Staff comments

1. This loan was part of an Africa-wide $1.454 billion lending program by the China Development Bank to support the development of SMEs. 2. In 2012, CDB provided a separate medium term loan to Equity Bank Kenya (as captured via Record ID#69475). 3. For loan and debt rescheduling records with variable interest rates, AidData calculates the all-in interest rate at T0 based on the reference rate (such as LIBOR or EURIBOR) on the loan start date, plus any known margin. Please see the methodology for additional details.