AfDB, InfraCredit Seal $15Mn Pact For Nigeria’s Infrastructure Financing

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The African Development Bank (AfDB) and Infrastructure Credit Guarantee Company Limited (InfraCredit) have signed an agreement for a $15 million subordinated loan facility to strengthen InfraCredit’s capital base and attract institutional investors’ resources to help close Nigeria’s infrastructure financing gap.

The Director General of the AfDB’s Nigeria Country Department, Lamin Barrow, and Chief Executive Officer of InfraCredit, Chinua Azubike, signed the agreement in Lagos

According to the terms of the deal, the facility will boost InfraCredit’s efforts to unlock additional long-term local currency financing through the capital markets for infrastructure projects, primarily by leveraging pools of capital from pension funds and other institutional investors in the West African country.

InfraCredit is a specialized Nigerian credit guarantee company that mobilizes long-term capital from institutional investors to support infrastructure projects, including green and climate-aligned developments.

Commenting on the pact, Barrow, who expressed the development finance institution’s satisfaction with the operation, said: “Our support to institutions such as InfraCredit demonstrates the importance of promoting innovative and scalable solutions to leverage pools of capital from domestic institutional investors, and position local capital market as a viable alternative source of long-term funding to bridge the continent’s huge infrastructure deficit, he stated.”

In his remarks, the InfraCredit’s CEO enthused:“We are delighted by the African Development Bank’s confidence in our business model, which has successfully facilitated private sector investment in impactful infrastructure projects and InfraCredit’s clean energy roadmap that has accelerated green finance for climate-aligned infrastructure, fostering SME growth, job creation, sustainable energy access, and overall economic development.

“Despite challenging market conditions, we have consistently demonstrated strong fundamentals, solid portfolio performance, a proven track record, and profitability. The further expansion of our capital base by this facility will bolster our ability to support access to long-term local currency domestic credit for our rapidly growing pipeline of infrastructure projects currently worth over NGN 625 billion (US$ 430 million), fostering job creation and economic growth”, Azubike added.

Also, the AfDB’s Vice President for Private Sector, Infrastructure and Industrialization, Solomon Quaynor, said: “The African Development Bank is pleased to be providing additional capital to InfraCredit Nigeria. The success of InfraCredit has inspired the replication of its business model across the continent, a key part of our strategy for scaling up private sector financing in Africa. This is evidenced by our support for the establishment of a similar institution in Kenya covering the East Africa region.”

Experts believe that the partnership with InfraCredit will further support AfDB’s sundry strategic objectives under its current country strategy for Nigeria, including stimulating local currency bond market financing across key infrastructure sectors and enhancing economic diversification and competitiveness.

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