Indigenous banker Union Trust Bank (UTB) Wednesday signed up a two million dollar worth portfolio “guarantee” agreement with the African Guarantee Fund (AGF) to provide loans for Small and Medium sized Enterprises (SME’s) in the agro-business sector.
The “guarantee” which is for a maximum amount of $2million has an initial utilization limit of US$ 500,000.00. The actual “guarantees” will be issued in Leones, the currency of UTB’s loan portfolio.
The “guarantee” facility comes with a “Capacity Development” component through which AGF will assist UTB enhance its SME Banking capabilities.
Before signing the agreement the Chief Executive Officer of UTB James Sanpha Koroma said “The partnership with AGF provides us with an opportunity to increase our lending activities to SMEs in Sierra Leone.”
He said “the guarantee facility capacity development assistance will also go a long way in helping the Bank to offer innovative SME portfolio to the right scale and quality”.
The Chief Executive Officer of African Guarantee Fund Felix Bikposaid “We are happy to be associated with UTB, a bank which has a commendable mission of empowering Sierra Leonean enterprises.”
He assured that “AGF is ready to use its facilities to help UTB scale up its activities in the SME banking space and thus contribute to employment creation and poverty alleviation.”
The African Guarantee Fund for Small and Medium Sized Enterprises is a Pan-African Development Finance Institution whose mandate is to assist African SMEs have increased access to finance from formal financial sector players through the provision of partial financial guarantees as well as capacity development assistance.
African Guarantee Fund (AGF), is owned by the African Development Bank (ADB), Danida and Aecid. AGF is based in Nairobi, Kenya and has an African wide mandate.
Whilst Union Trust Bank is also a registered commercial bank in Sierra Leone majority owned and managed by Sierra Leone nationals focusing on the Business Banking Segment of the market the bank has a mission of empowering indigenous business through its various product and services.