The European Investment Bank has stepped up its cooperation with Gabon's financial sector via two new lines of credit: i) a loan of EUR 6.5m to BGFIBANK Gabon and ii) a loan of EUR 3.5m to Banque gabonaise de développement (BGD). Both loans meet the specific needs of the two banks selected by providing them with the long-term financial resources currently lacking on the banking market in Central Africa.
The EIB, the European Union's long-term financing institution, supports Gabon's financial sector in line with its mandate under the Cotonou Agreement between the EU and the ACP States.
The finance contracts corresponding to these two operations were signed today in Libreville between the EIB and each bank.
The purpose of these EIB loans is to inject into Gabon's economy part of the long-term funds required to finance private sector investment, while helping the two banks concerned to shore up their respective balance sheets.
This operation follows up on a similar loan previously arranged in Gabon with BGFIBANK, BGD and BICIG, which has been deployed over the past three years. BGFIBANK is the second largest bank in Gabon, ¾-owned by private shareholders with the rest of its capital held by BGD and the Gabon government. Banque gabonaise de développement is a public corporation majority owned by the Republic of Gabon.
In addition, the EIB is planning to mount a further operation aimed at strengthening the quasi-equity of two subsidiaries of BGFIBANK (BGFIBAIL and FINATRA) via a EUR 6m subordinated loan already approved by the Bank's decision-making bodies.
The EIB was established in 1958 by the Treaty of Rome with a remit to finance capital projects furthering the European Union's broad policy objectives. It also participates in implementation of the EU's co-operation policy towards non-member countries that have concluded co-operation or association agreements with the Union.
Currently, the Bank's financing in Africa, the Caribbean and the Pacific (ACP) is carried out in the framework of the ACP-EU Partnership Agreement signed in Cotonou in June 2000. Under the Cotonou Agreement, the total financial aid available amounts to EUR 15.2 billion for 2002-2006, of which EUR 11.3 billion in grant aid from the EU Member States, EUR 2.2 billion managed by the EIB under the Investment Facility (IF - replacing risk capital financing) and up to EUR 1.7 billion in loans from the EIB's own resources. The IF is a revolving facility (loan repayments are invested in new operations) aimed at supporting technically, environmentally, financially and economically sound projects in the private or commercially-run public sectors.