OPIC and Standard Bank Group Announce $125 Million Loan Guaranty for Botswana's Local Cutting and Polishing Industry
September 26, 2018
Loan to support economic expansion and job creation
New York, NY / Gaborone, Botswana – Stanbic Bank Botswana, a member of Standard Bank Group; the Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution; and Botswana Finance LLC, a subsidiary of Lazare Kaplan International (LKI), today signed a $125 million loan guaranty, which will encourage and support lending to diamond manufacturers and polishing companies while allowing the organizations to share credit risk.
In keeping with Standard Bank’s objective of driving growth in Africa, this loan guaranty will help diversify Botswana’s economy, drive the development of the local financial sector and give local companies access to financing. Stanbic Bank has been lending to diamond beneficiation companies in Botswana for over ten years and this facility will support and allow us to expand the availability of financing for the sector.
“With the support of OPIC financing, this project will keep the value-adding process of the diamond supply chain in Botswana, promoting local job creation, diversifying economic growth, and bringing global trade opportunities,” said OPIC President and Chief Executive Officer Ray W. Washburne who recently visited the country. “The project will have a significant impact in local communities and further the country’s economic development.”
Samuel Minta, acting Chief Executive Officer of Stanbic Bank Botswana said, “We expect continued growth in Botswana’s diamond beneficiation to have positive residual effects on several sectors, including electricity, finance and business. We are proud that this loan guaranty will play a strong role in the continued economic growth of the country.”
Leon Tempelsman, President of LKI stated, “Stanbic Bank Botswana and OPIC share our vision of how the diamond industry can support constructive economic growth in the countries and communities where it operates. We commend both OPIC and Stanbic Bank Botswana for their commitment to the next stage of development and diversification of the economy of Botswana.”
This is the second tranche of a $250 million OPIC loan guaranty – the first of which was fulfilled by Barclays Bank of Botswana in 2016.
Announced in July, OPIC’s Connect Africa initiative seeks to invest $1 billion over three years to projects that support telecommunications and internet access, value chains that connect producers of raw materials to end users, and critical infrastructure, such as roads, railways, ports, and airports.
About Stanbic Bank Botswana: Stanbic Bank Botswana is a member of Standard Bank Group. Our roots date back to 1992 when Standard Bank acquired the African operation of ANZ Grindlays. We are the fourth largest commercial bank in Botswana and offer the full spectrum of financial services. Our Corporate and Investment Banking unit services a wide range of requirements for banking, finance, trading, investment, risk management and advisory services. This business unit offers a wide range of products and services covering investment banking; global markets; global transactional products and services as well as private equity. Our Personal and Business Banking products include mortgage lending, instalment sale and finance leases, card products, transaction and lending products, and bancassurance. We currently have over 600 employees and 11 branches: six in Gaborone, one in Francistown, Maun, Mogoditshane, Palapye and Selebi Phikwe. We also service our customers through a network of 48 ATMs nationwide and more than 1000 point-of-sale machines.
The Standard Bank Group is Africa’s largest bank by assets and also has the biggest single network of banking services in Africa. Through this network it is able to offer a wide range of banking products and services. These are delivered through more than 1 450 points of representation in 19 African countries, including Botswana. In addition to the Group’s well distributed footprint, it has 53 000 employees around the world to ensure delivery of a complete range of services that cuts across Personal and Business Banking, Corporate and Investment Banking and wealth management.
We are committed to creating prosperity and giving back to our community, the people of Botswana. We are involved in various corporate social responsibility activities that live up to one of our strategic goals of being relevant in the communities in which we operate.
About OPIC: OPIC is the U.S. Government’s development finance institution. It mobilizes private capital to help address critical development challenges and in doing so, advances U.S. foreign policy and national security priorities. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets, catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, political risk insurance, and support for private equity investment funds, when commercial funding cannot be obtained elsewhere. Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers.
All OPIC projects adhere to high environmental and social standards and respect human rights, including worker's rights. By mandating high standards, OPIC aims to raise the industry and regional standards of the countries where it funds projects. OPIC services are available for new and expanding business enterprises in more than 160 countries worldwide.
About Lazare Kaplan International: Botswana Finance LLC is a subsidiary of LKI, the project sponsor and investor. LKI is a New York-based global company with over 100 years of participation, and a long record of innovation, in the diamond industry, including leadership in promoting transparency and accountability within the trade. It was involved in the design of the Kimberley Process, the industry’s first attempt to establish verifiable chains of custody for diamonds internationally; was the first company specialized in diamond trading to raise funding in public capital markets; and the first also to become a participant in the UN Global Compact, the world’s largest social corporate responsibility initiative.