The three development banks signed a USD 67.5 million loan to Lebanon and Gulf Bank (LGB BANK). In addition to the USD 32.5 million provided by FMO, OFID (the OPEC Fund for International Development) financed USD 20 million and Oesterreichische Entwicklungsbank AG (OeEB) USD 15 million. The total loan will have a tenor of 5 years. FMO has acted as the Mandated Lead Arranger and Facility Agent. Alpen Capital (ME) Limited acted as the sole financial advisor to the transaction. The transaction was established by the efforts of OFID and Alpen Capital.
This is the first syndicated transaction to a Lebanese Bank and LGB BANK’s first loan received from international lenders. The facility increases the availability of funding for Small and Medium Enterprises (SMEs) in Lebanon, representing 97% of all formal enterprises in Lebanon. The sector is identified as one of the most underserved markets offering the largest potential in terms of volume and combatting the high unemployment rate. By stimulating investment in the SME segment, the lenders aim to boost economic and private sector development, and contribute to job creation.
Mr. Jurgen Rigterink, CEO of FMO said: “This marks the first debt transaction in Lebanon after several years. It fits perfectly in our new strategy to expand in the financial sector in the MENA region, supporting SMEs and thereby stimulating job creation in the country”.
LGB BANK’s CEO, Mr. Samer A. H. Itani commented: “We are proud of the excellent collaboration between FMO, OFID, OeEB and LGB BANK as its proves our bank’s willingness to enhance key drivers of the Lebanese economy. This syndicated facility will furthermore strengthen LGB BANK’s position as a leading lender of major SMEs across the country, and also demonstrates our determination in nurturing business relationships with our international partners. Moreover, this transaction will assist the Bank in enhancing its Corporate Social Responsibility and strengthening its efforts to support its community”.
OFID’s Director-General, Mr. Suleiman J Al-Herbish, said: “OFID works hard to develop and maintain partnerships to optimize the impact of its contribution to international development. We are proud to have played such an instrumental role in an important transaction that will stimulate Lebanon’s private sector and help support SMEs.”
About LGB Bank
Established in 1963 under the name of Banque de Credit Agricole s.a.l., LGB BANK adopted its current name and shareholders’ form in 1980. LGB BANK is a well-established bank with a strong legacy, solid financials and potential for growth. During 2016, LGB BANK outperformed the Lebanese banking sector ranking 2nd in terms of deposits growth, 3rd in terms of assets and 6th in terms of net profit. This growth in financial records is reflected in the Bank’s expansion strategy, while maintaining a conservative risk approach, which resulted in a network of branches across Lebanon, a branch in Cyprus and a representative office in Dubai.
OFID is the development finance institution established by the Member States of OPEC in 1976 as a channel of aid to developing countries. OFID works in cooperation with developing country partners and the international donor community to stimulate economic growth and alleviate poverty in all disadvantaged regions of the world. It does this by providing financing to build essential infrastructure, strengthen social services delivery and promote productivity,
competitiveness and trade. OFID’s work is people-centered, focusing on projects that meet basic needs—such as food, energy, clean water and sanitation, healthcare and education. OFID aims to encourage self-reliance and inspire hope for the future.
OeEB has been operating as the Development Bank of Austria since March 2008. It specializes in the provision of long-term finance for the implementation of private sector projects in developing countries which create sustainable development. Additionally, OeEB provides technical assistance, which can be used to enhance the developmental impact of projects. For more information, please visit http://www.oe-eb.at.
About Alpen Capital (ME) Ltd
Alpen Capital (ME) Limited is incorporated as a limited liability company in the Dubai
International Financial Centre, Dubai, United Arab Emirates and is licensed by the Dubai
Financial Services Authority. With local know-how and regional expertise, Alpen Capital offers a full range of investment banking advisory services in the areas of M & A, Debt, Equity and Capital markets. Apart from Dubai, it has offices in Abu Dhabi, Doha, Muscat, Mumbai and New Delhi. Please visit us at – www.alpencapital.com