The International Finance Corporation (IFC), the private investment arm of the World Bank Group, is looking to invest up to $50 million in Dhaka Bank to support the expansion of the USD denominated trade business of the bank through its offshore banking unit.
The investment consists of mobilisation of $30-$40 million through IFC led B-Loan investments and IFC own investment of up to $10-20 million in the bank, IFC said in a disclosure dated March 1.
The financing provided is a fit with the World Bank and IFC strategy of promoting economic growth by providing access to finance to underserved market segments and promoting international trade, thereby leading to improved competitiveness, job retention and creation, it added.
Dhaka Bank commenced operations in April 1995 and is publicly listed in Dhaka and Chittagong Stock Exchanges. The bank has total assets of $2.8 billion as of September 30, 2017.
It is 37.75 per cent owned by the general public, 22.49 per cent by local institutions and 0.14 per cent by foreign institutions as of December 2017. The remaining 39.62 per cent of shares is held by the sponsors/directors.
The bank operates through 100 branches including 2 Islamic banking branches, 2 offshore banking units and 56 owned ATMs in almost all major cities of Bangladesh.
In the past few months, IFC has been expanding its exposure in Bangladesh financial services sector. It recently proposed to invest up to $40 million in the form of a straight senior loan in Bank Asia. It is also considering an investment of $80 million in Pubali Bank Limited (PBL).
Recently, IFC also proposed to provide up to $40 million in senior financing in IDLC Finance Ltd (IDLC), the largest non-banking financial institution in Bangladesh. In November last year, IFC said it is considering extending up to $40 million in a short-term loan to Dhaka-headquartered BRAC Bank Ltd.
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