Cooperative Bank of Oromia - Nasira Portfolio
Status: Proposed investmentWhy disclosure?
FMO is committed to making publicly available relevant investment information that informs stakeholders and enables them to engage directly with FMO on its investments which, in turn, enhances our investment decisions, the design and implementation of projects and policies, and strengthens development outcomes. Learn more
In case of questions
We welcome feedback on this proposed investment opportunity for FMO. The ending of the proposed investment phase is indicated on the right side of this page. In case of questions, please contact us at disclosure@fmo.nl
Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our prospective customer?
Cooperative Bank of Oromia ('COOP') is the fourth largest bank in Ethiopia. The bank started in 2004 with a focus on the agricultural sector & cooperatives. It has since expanded into a universal bank and currently operates through c.740 branches with c.13mn customers across the country and with 75% of the branches in rural areas.
What is our funding objective?
COOP is considered a good partner for FMO given their unique focus on cooperatives and agriculture clients and strong interest in promoting sustainable banking and agriculture practices. In addition, the bank is seen as one of the most innovative in the market having launched the sector’s first digital lending app and alternative banking channels (mobile money and agency networks) and is one of the only banks in the country to be actively lending to Micro, Small, and Medium Enterprises (MSMEs) and the agriculture sector with the bank operating primarily through rural branches and also employing c.90 agronomists to provide capacity building and advisory support to their clients.
Why do we want to fund this investment?
This will be the first guarantee under the Nasira risk-sharing facility in Ethiopia with the guarantee covering the bank’s loans to their MSME clients, making it a highly impactful transaction that will encourage more financing to MSMEs in Ethiopia and qualifying the transaction as 100% Reducing Inequalities.
What is the Environmental and Social categorization rationale?
COOP has been categorized as E&S risk "A" due to the exposure to IFC Performance Standards transactions in the bank’s portfolio and the contextual risks in Ethiopia. COOP is in full compliance with FMO's exclusion list and FMO will be supporting the bank through Technical Assistance to develop and implement an E&S Management System to ensure the bank is well equipped to manage the E&S risks in their portfolio.
More investments
| Date | Total FMO financing |
|---|---|
| 5/2/2024 | USD 0.50 MLN |
- Website customer/investment
- https://coopbankoromia.com.et/
- Region
- Africa
- Country
- Ethiopia
- Sector
- Financial Institutions
- Publication date
- 5/2/2024
- Deadline for feedback
- 7/1/2024
- Total FMO financing
- USD 4.40 MLN
- Funding
- 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) - A