THE AFRICA BAZAAR Staff Writer
October 13, 2015
Ecobank Nigeria has secured an export credit guarantee trade financing deal with Deutsche Bank through the signing of a Memorandum of Understanding that will expand on their current trade financing relationship.
The new deal will give Ecobank Nigeria sufficient financial strength to have foreign exchange available for its commercial and agribusiness customers to gain access to more funds, while also guaranteeing that the Bank is able to meet its other financial obligations.
According to terms of the deal, Deutsche Bank will provide a GSM-102 export credit guarantee program to Ecobank Nigeria, thereby reducing the financial risks to the lender, while providing a competitive credit terms to buyers.
“Deutsche Bank’s export credit guarantee service will offer a simple and efficient way for our importers to access agricultural products in the US and strengthen economic and trade development in the region,” said Managing Director at Ecobank Nigeria, Fibril Aku.
The bank’s offering of a GSM-102 program will guarantee credit to encourage financing of commercial exports of US agricultural products, such as high-value consumer-oriented processed products such as frozen foods, fresh produce, meats, hides, paper products, flour, and grains while providing competitive credit terms to buyers.
The GSM-102 program provides financial lenders in developing nations like Nigeria with the credits guarantees they need to encourage financing of commercial import of agricultural products from other countries while at the same time providing competitive terms to buyers.
“We are pleased to offer this program to Ecobank Nigeria,” said Ulf Peter Noetzel, Head of Trade Finance Institutions- Western Europe & Africa, Global Transaction Banking at Deutsche Bank. “As a leading provider for GSM-102 business in Africa, and in close coordination with the Commodity Credit Corporation and the US Department of Agriculture’s Foreign Service, Ecobank Nigeria will benefit from Deutsche Bank’s strong global and US footprint.”
Ecobank Nigeria will use irrevocable US dollar denominated letters of credit for the import of eligible agricultural products from the US. Deutsche Bank will advice, confirm and negotiate these letters of credit as well as provide post-shipment financing in accordance with the GSM-102 program regulations.
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