Stanbic Bank Uganda, the country’s biggest bank by assets, is borrowing $55 million in Dubai for lending in Uganda.
The Uganda Securities Exchange-listed company, a subsidiary of Standard Bank Group, says it reached an agreement with Emirates NBD Capital Limited, Al Ahli Bank of Kuwait K.S.C.P, Bank of Baroda, SBM Bank (Mauritius) Ltd and The Commercial Bank (Q.S.C.) for the two-year loan facility.
Stanbic Bank will pay an interest rate of LIBOR plus 2.75% margin on the loan.
The bank was initially targeting $40 million but the loan was increased due to interest from other banks which wanted to back the transaction.
Patrick Mweheire, Stanbic Bank Uganda’s chief executive, said the bank “continues to demonstrate market leadership by completing another successful transaction in the international loan markets, in an extended two-year tenor at such tight pricing.”
The bank says it will use the loan for “general corporate purposes,” including loans to the energy, agriculture, manufacturing, trade, telecommunications, and infrastructure sectors, among others.
In January 2015, Stanbic Bank Uganda signed an $85 million 18-month loan with Emirates NBD Capital in Dubai, the first time it was borrowing from international loan markets. Four other banks backed the deal.
Stanbic recently announced that it will start lending at 22% interest on 1 October, from the current 23%.