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Sustainable development

IFC Announces Anchor Investments in Sustainability Bonds for NMB Bank in Tanzania

Strategic Insights

— 2 min read

IFC is supporting wider access to finance for projects promoting green, social, and sustainability goals in Tanzania, as well as increasing access to finance for smaller businesses in the country. The organization announced anchor investments in multicurrency bonds issued by NMB Bank, which will finance or refinance a range of projects, including renewable energy, energy efficiency, and affordable housing initiatives. The bonds will also support small businesses participating in qualifying green and social projects, enabling NMB Bank to increase its number of loans extended to MSMEs by almost 50 percent by 2027.

Key Takeaways:

  • IFC invested in almost 16 percent of the Tanzanian shilling and U.S. Dollar-denominated tranches of NMB Bank's multicurrency bond, equivalent in aggregate to $25 million in Tanzanian shillings.
  • The bonds raised $159 million in total, with the Tanzanian shilling and U.S. dollar tranches issued on November 12 and December 8, respectively.
  • The bonds align with the 2021 Social Bond Principles of the International Capital Markets Association, which require transparent and accurate reporting to stakeholders.
  • IFC anticipates that at least 3,200 new jobs over four years will be created by projects and businesses funded or co-funded by proceeds from the bonds.
  • NMB Bank aims to increase its number of loans extended to MSMEs by almost 50 percent by 2027.
  • The IFC investment in NMB's local currency bond is supported by the International Development Association's (IDA) Private Sector Window Local Currency Facility.
  • This investment follows an IFC investment in NMB's Jasiri gender bond issued in 2022, which is financing more than 3,000 women-owned MSMEs in Tanzania and helping bridge access to finance gender gaps.
  • NMB Bank's sustainability bonds further its values as a bank, as stated by its CEO Ruth Zaipuna, who emphasizes the bank's commitment to growing its business while fulfilling broader development goals in a sustainable manner.

Statistics:

  • 16%: The percentage of IFC's investment in NMB Bank's multicurrency bond.
  • $159 million: The total amount raised by the bonds.
  • 2027: The year in which NMB Bank aims to increase its number of loans extended to MSMEs by almost 50 percent.
  • 3,200: The anticipated number of new jobs created by projects and businesses funded or co-funded by proceeds from the bonds over four years.
  • $25 million: The aggregate equivalent of IFC's investment in the Tanzanian shilling and U.S. Dollar-denominated tranches of the multicurrency bond.

Sources:

  • IFC press release
  • International Capital Markets Association (ICMA) Social Bond Principles
  • International Development Association (IDA) Private Sector Window Local Currency Facility
  • British International Investment (BII) press release
  • NMB Bank press release

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