Kenya gets US$100m AfDB loan for lending to SMEs

NAIROBI - KCB Group, the country’s largest bank by assets, has secured a $100 million (about Sh10.37 billion) loan from the African Development Bank (AfDB) for onward lending to small and medium sized enterprises (SMEs) in the region.

The AfDB board approved the long term funding last Wednesday.

“The funding is aimed at supporting KCB’s lending in Kenya especially to corporate businesses, small and medium enterprises (SMEs) as well as projects that are critical to the development of Kenya’s economy,” said the multilateral lender in a statement.

“Proceeds of the line of credit will provide much-needed liquidity support to, among other sectors, infrastructure, energy and value-addition through manufacturing and important population segments like the youth.”

AfDB urged KCB to use the facility to also boost support for women owned businesses in its regional operations.

KCB’s loan book grew 11.4 per cent to Sh385.7 billion in the year ended December 2016 compared from Sh345.9 billion in the review period a year earlier.

Early this month, AfDB signed a $90 million (about Sh9.29 billion) facility with Commercial Bank of Africa, the country’s largest privatelyowned lender with CBA eyeing to finance firms in trade, manufacturing, agriculture, infrastructure, transport, and construction.

Kenya has been on a credit squeeze since September last year, with banks rationing loans following the interest rate cap.