The West African Development Bank (BOAD), the development finance institution of the Francophone and Lusophone member-countries of the West African Economic and Monetary Union (WAEMU), has announced the Arab Bank for Economic Development in Africa’s (BADEA’s) equity stake in the second phase of its capitalization.
The capital increase was sequel to a favourable opinion issued by the Bank’s Board of Directors, at its 139th meeting held on 20th December 2023 in Cotonou, after which the WAMU Council of Ministers met on 21st December 2023 and approved the participation of BADEA in BOAD’s capital.
The development finance bank’s capitalization kicked off under its first phase, which was completed in December 2022 for an amount of XOF554.38 billion.
As a reminder, the BOAD capital increase process, referred to as “Peninsula” project, is structured into two phases: a first phase involving the issue of shares reserved for the Bank’s current shareholders, and a second phase involving the issue of shares open to new shareholders, whose accession is subject to approval by the Council of Ministers, as provided for by BOAD’s Articles of Association.
According to a news report from African Press Organisation (APO) Group, the participation of BADEA in the bank’s capital as a class B shareholder (non-regional shareholder) is part of this second phase, and involves an amount of US$30 million, or XOF18.47 billion.
The news report indicates that stake is equivalent to 1.20% of BOAD’s subscribed share capital, giving this first-rate institution a seat on its Board of Directors.
The two institutions are breaking new ground for their long-standing cooperation, which to date has been marked by the provision by BADEA of resources on preferential terms, and by the co-financing of several infrastructure projects in WAEMU countries, as well as the granting of subsidies to BOAD to support structuring projects.
Commenting on the BADEA’s equity stake in BOAD, the President Serge Ekué, said: “BADEA’s participation as a new shareholder follows 10 years after the Kingdom of Morocco joined BOAD’s capital in 2013.
“This was the result of a series of discussions over the past two years. It is the translation of excellent relationships between both of our institutions, but also the result of a perfect common understanding between the President of BADEA, my dear friend and brother, Mr. Sidi Ould Tah, to whom I wish to pay a heartfelt tribute. My warmest congratulations to our respective technical teams”, Ekué added.
It would be recalled that BADEA, which was established on 28th November 1973 and started operations since March 1975 with head office in Khartoum (Sudan), is a financial organization whose aim is to be a “world bank for Africans”, comprising 18 member countries including Saudi Arabia, Kuwait, Iraq, Libya, the United Arab Emirates and Qatar. It is rated Aa2 with a positive outlook by Moody’s.
