CRDB Bank has said it will champion social development in the Democratic Republic of Congo (DRC) with a 30 million US dollars (70bn/-) subsidiary.
The lender said in a statement on Wednesday from Lubumbashi, the DRC’s second-largest city that it finalised plans to launch operations in Congo in the second half of this year.
The investment is part of CRDB Group’s regional expansion strategy, targeting the larger Eastern African market.
The Group CEO and Managing Director, Mr Abdulmajid Nsekela said that in regard to the DRC subsidiary, which will be based in the commercial hub of Lubumbashi, the bank has already got approval from the Central Bank of Tanzania (BoT) since last May.
“We see the DRC as an exciting market for us since it provides a unique opportunity for our Group to transform lives beyond our borders,” Mr Nsekela said.
For the CRDB subsidiary, the lender has secured two equity partners, the Norwegian Investment Fund for Developing Countries (Norfund), and the Danish Investment Fund for Developing Countries (IFU). CRDB Bank will hold a majority stake of 55per cent, while Norfund and IFU will each hold 22.5 per cent equity.
“Our equity partners provide us with a unique edge, because of their strong focus on sustainability and social development,” Mr Nsekela said.
IFU invests in financially viable companies, contributing to the green transition, as well as building just and inclusive societies.
On the other hand, Norfund prioritizes investments in four investment areas aligned with the UN´s Sustainable Development Goals.
The areas include clean energy, financial institutions, green infrastructure, and scalable enterprises.
“We are impressed with how CRDB is committed to sustainability, and we see partnering with the bank in entering DRC as a great opportunity to promote financial inclusion and contribute to job creation in a country where the majority of the population is unbanked”, said Mr Espen Froyn, the Norfund Vice President.
IFU Vice President, Mr Morten Elkjær noted that CRDB’s continued investment in sustainability programmes such as climate adaptation agriculture and clean energy have made it a strategic ally and a thought leader.
“We are particular about investments that support the green transition and contribute to poverty alleviation and reduced inequality,” Mr Elkjær explained.
1The International Monetary Fund (IMF)’s latest country report for DRC released on Wednesday said DRC is the largest cobalt producer worldwide and top copper producer in Africa – two key minerals needed for the global energy transition. In addition, the DRC is a carbon-negative emitter and can absorb two-thirds of Africa’s carbon emissions.
“On the upside,” IMF said, “the DRC is well-positioned to benefit from the global climate transition, easing the path in the country towards higher and more inclusive growth.”
However, the report warned that the global energy transition may trigger an increase