CAPITAL BANK OF JORDAN NASIRA PORTFStatus: Approved investment
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Who is our customer
Capital Bank of Jordan (“CBoJ”) is the #7 largest bank in Jordan, with the largest growing SME portfolio of Jordan (20% of loan portfolio). Total Assets amount to ~USD 4 billion. Together with its subsidiaries in Dubai (100%) and Iraq (61.85%), Capital Bank Group offers commercial and investment banking services and solutions tailored to the needs of individual, SME and corporate clients alike. CBoJ is committed to become the #1 digitally enabled bank of Jordan that can offer the most (cost) efficient services to its clients. With the support of a variety of partnerships, the CBoJ aims to grow and capture an increasing (MSME) market share. CBoJ’s strategy is to serve multiple market segments by setting up partnerships with fintechs, MSME lenders, etc. As such, it broadens its target market while ensuring it can serve its clients in an efficient and dedicated way.
What is our funding objective?
FMO has supported CBoJ with a USD 20mln in JOD equivalent unfunded revolving Risk Sharing Facility (“RSF”). The RSF covers loans to COVID-19 affected MSMEs and young entrepreneurs in Jordan. The Guaranteed Portfolio is earmarked to loans originated through alternative MSME lenders (Liwwa and Sanadcom) increasing their ability to get access to funding from a local Tier 1 bank.
Why do we fund this investment?
The Risk Sharing Facility perfectly fits with FMO’s and FI’s strategy to contribute to economic growth and reducing inequalities in Europe’s Neighbourhood Countries. MSMEs in Jordan make up 95% of all businesses, account for 37% of private sector employment whilst they only receive 10% of total facilities granted by banks. In addition, unemployment is high amongst youth (37%). MSMEs are heavily impacted by COVID-19 due to the slowdown of the economy. Our guarantee represents a comprehensive COVID-19 support package to MSMEs and helps CBoJ and its partners to strengthen its ability to serve this market. Indirectly, by covering CBoJ’s funding of Liwwa's and Sanadcom's loan portfolio, our guarantee facilitates financing between local partners making the local financial ecosystem more sustainable. As such, it mobilizes local savings.
What is the Environmental and Social categorization rationale?
The bank is categorized as an E&S B-risk. Liwwa and Sanadcom are categorized as E&S C-risks.
|Date||Total FMO financing|
|10/4/2021||USD 0.28 MLN|
- Financial Institutions
- Effective date
- Total FMO financing
- USD 18.58 MLN
- FMO NV
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C)