London, December 2024 – The African Local Currency Bond Fund (ALCB Fund) is proud to announce its strategic investment of TZS 19 billion in Stanbic Bank Tanzania’s TZS 35 billion bond issuance via a restricted offer. This investment underscores the Fund’s commitment to bolstering local currency debt markets across Africa and supporting long-term growth.
The bond issuance marks a milestone in Tanzania's financial landscape by enhancing access to affordable credit for Small and Medium Enterprises (SMEs).The bond proceeds will enable Stanbic Bank Tanzania to expand its SME lending portfolio, with a particular emphasis on businesses in underserved sectors such as agribusiness, trade, and manufacturing. By targeting these critical areas, the investment aligns with Stanbic’s strategic goal of fostering inclusive economic growth and improving access to finance for businesses that drive job creation and innovation.
The ALCB Fund’s investment was complemented by a grant from The Currency Exchange Fund (TCX) through their European Union (EU) Market Creation Facility. This innovative support mechanism mitigates currency risk and promotes financial inclusivity by reducing hedging costs and enabling local currency funding.
This initiative aligns with the ALCB Fund’s broader mandate of fostering the development of African capital markets while reducing reliance on hard currency financing. The collaboration with Stanbic Bank Tanzania also highlights the Fund's focus on promoting financing solutions tailored to local economic needs.
Manzi Rwegasira, Managing Director of Stanbic Bank Tanzania, stated: "Stanbic Bank Tanzania is committed to driving growth and empowering Tanzanian businesses. The support from the ALCB Fund and TCX strengthens our ability to provide much-needed TZS liquidity and affordable credit to SMEs. The issuance reflects growing investor confidence in Tanzania’s financial sector and the potential of local capital markets to mobilise resources for economic transformation.”
Fola Pedro, Senior Investment Officer of the ALCB Fund, commented: "Through this investment, the ALCB Fund demonstrates its commitment to catalysing economic development in Tanzania by empowering SMEs, which are the backbone of the economy. This bond issuance also exemplifies the importance of collaboration with partners like TCX to strengthen local currency ecosystems.”
Ruurd Brouwer, CEO of TCX, added: "We are proud to support this bond issuance through our EU Market Creation Facility. Mitigating currency risk is vital to ensuring that local businesses can access sustainable financing. This collaboration demonstrates the power of partnerships to unlock economic potential while building resilience in local markets."
