IFC Partners with Southeast Bank to Enhance Trade Finance in Bangladesh
IFC, the private sector arm of the World Bank Group, today announced that Bangladesh’s Southeast Bank is joining its Global Trade Finance Program. IFC is providing Southeast Bank with a $5 million facility within the program.
The Global Trade Finance Program supports trade with emerging markets worldwide and promotes the flow of goods and services between developing countries. IFC provides partial or full guarantees against underlying trade instruments and covers the payment risk of participating issuing banks. The program allows issuing banks, such as Southeast Bank, to increase the volume and value of trade transactions, with enhanced tenors and access to competitive pricing terms.
Neaz Ahmed, Managing Director of Southeast Bank, welcomed the partnership by saying, “We are delighted to extend our relationship with IFC through its Global Trade Finance Program. This will help us expand our network of correspondent banks and create new and valuable business opportunities for our clients in Bangladesh and across the world.”
IFC’s support to Southeast Bank fits well with its strategy to partner with financial institutions and banks that are committed to developing Bangladesh’s corporate and small and medium enterprise sectors. IFC’s Global Trade Finance Program will provide Southeast Bank with risk coverage in a difficult market and a global network that will help grow its trade finance business. This paves the way for countries like Bangladesh to increase their share of global trade.
Per Kjellerhaug, IFC’s Country Manager for Bangladesh, Bhutan, and Nepal, said, “The Global Trade Finance Program is an important mechanism to get local banks into an active global network that facilitates transactions in challenging markets, promotes competitive financing, and builds correspondent bank relationships with new institutions on a low-risk basis. Trade finance is one good example of the many products IFC offers to help develop a sector"
Trade development and advisory services for issuing banks represent an integral part of IFC’s Global Trade Finance Program. Advisory services modules include basic and intermediate courses on trade finance. In some cases, IFC places experienced trade finance bankers with issuing banks to help them develop their trade finance and other banking skills.
IFC’s relationship with Southeast Bank goes back to 2003, when the bank became a financial partner with IFC Advisory Services in the region—the SouthAsia Enterprise Development Facility. An initial diagnostic study and strategy workshop were conducted and a capacity-building IT project was implemented based on the gaps identified. Other ventures included projects for obtaining ISO Certification for banking operations, a credit-scoring workshop, SME banking exposure tours, and a workshop to develop SME marketing skills.
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