How Trade Development Bank Supports Client and Market Growth

Trade Development Bank is a vital partner for businesses looking to expand their operations and reach new markets. By providing a wide range of financial services, the bank enables its clients to achieve their growth goals.

The bank's financial services include corporate and investment banking, trade finance, and transaction banking, which cater to the diverse needs of its clients. This comprehensive approach allows clients to manage their financial activities efficiently.

With a strong presence in several countries, Trade Development Bank has a deep understanding of the local markets and economies. This expertise enables the bank to provide tailored solutions that meet the specific needs of its clients.

By supporting client and market growth, Trade Development Bank plays a significant role in driving economic development in the regions it operates in.

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The Trade Development Bank, also known as TDB, was established on November 6, 1985. It serves as the financial arm of COMESA, which was established by the Treaty for the Establishment of the Common Market for Eastern and Southern Africa in 1994.

TDB was initially established under Chapter Nine of the Treaty for the Establishment of the Preferential Trade Area for Eastern and Southern African States, which took effect on September 2, 1982. This treaty was later replaced by the one establishing COMESA in 1994.

The bank's establishment was a significant step towards promoting economic cooperation and development in the region.

The Trade and Development Bank has a broad mandate to provide financial and technical assistance and promote social and economic development and trade among its member states.

The Bank's shareholders include African States in COMESA, EAC, and SADC, as well as institutional investors such as the African Development Bank and the National Pension Fund of Mauritius.

The Bank's operations are guided by its Charter, which was established on November 6, 1985, and is based on the provisions of Chapter 9 of the COMESA Treaty.

The Trade Bank plays a vital role in promoting regional economic integration and socio-economic development among its member states. It was established as an autonomous specialized institution by the PTA Bank Charter on 6 November 1985.

The Trade Bank's broad objectives include providing financial and technical assistance to its member states. Its mandate is to finance and foster trade, socio-economic development, and regional economic integration.

The Bank's shareholders are comprised of African states in COMESA, EAC, and SADC, as well as institutional investors like the African Development Bank and COMESA Reinsurance Company ZEP-RE.

The Board of Governors is the supreme authority of TDB, making all major decisions.

Each shareholder designates one representative and one alternate to sit on the Board.

The Board of Governors is the highest authority at TDB, with significant influence over its operations.

Shareholders play a key role in appointing representatives to the Board, giving them a say in the bank's direction.

The composition of the Board is determined by the shareholders, with each one having a designated representative and alternate.

Citi worked with TDB and the Multilateral Investment Guarantee Authority (MIGA) to structure a new type of credit enhancement that covers the risk of a payment default by a regional development bank.

This credit enhancement is called a Non-Honoring of Financial Obligations by a Regional Development Bank (NHFO-RDB). It leverages TDB's credit rating, which is higher than that of its individual members.

The NHFO-RDB acts as a guarantee, mobilizing long-term funding to countries that would normally be ineligible for such cover.

Trade Development Bank's financial performance has been impressive, with a net profit of $10 million in 2020, a significant increase from $5 million in 2019.

The bank's revenue has grown steadily over the years, reaching $50 million in 2020, up from $30 million in 2018.

This growth can be attributed to the bank's strategic expansion into new markets and its focus on providing innovative financial solutions to its customers.

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TDB's credit rating has seen significant improvements over the years. In October 2017, Moody's Investors Service upgraded the long-term issuer rating of TDB to "Baa3" from "Ba1".

This upgrade is a testament to TDB's financial stability and management. The rating was maintained at "Baa3" by Moody's.

In October 2019, Fitch Ratings affirmed the Long-term Issuer Default Rating of TDB at "BB+" with Stable Outlook.

The NHFO-RDB solution has diversified TDB's funding sources and improved its access to international financial markets.

This has enabled TDB to secure a €334 million facility for its trade finance business.

The facility is now available for financing critical food and fuel, as well as equipment, supplies, and construction materials for healthcare facilities addressing the COVID-19 pandemic.

At least €50 million of the facility will be deployed to support imports related to healthcare facilities.

The Eastern and Southern African Trade & Development Bank (TDB) is a multilateral, treaty-based development financial institution with assets of over $6 billion.

TDB provides trade and project finance to its 22 member states. It plays a significant role in promoting regional economic integration and sustainable development.

TDB's focus on regional economic integration is crucial for the growth and development of its member states.

The Eastern and Southern African Trade & Development Bank (TDB) is a multilateral, treaty-based development financial institution with assets of over $6 billion.

TDB provides trade and project finance to its 22 member states, promoting regional economic integration and sustainable development.

TDB has a significant presence in the region, with a strong focus on supporting economic growth and development in Eastern and Southern Africa.

The COVID-19 pandemic had a significant impact on African economies, causing a slowdown in growth. This slowdown was particularly challenging for countries with limited fiscal and monetary headroom.

Low-income countries, as defined by the World Bank's International Development Association, struggled to access supply chain financing. Fragile conflict-affected countries faced additional challenges, including foreign exchange constraints.

Foreign exchange constraints are a major hurdle for businesses in these countries. Non-tariff barriers, such as cumbersome regulations, also posed a significant challenge.

The weak credit quality of buyers and suppliers further exacerbated the challenges faced by businesses in these countries.

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