MICROCAPITAL BRIEF: Deutsche Investitions-und Entwicklungsgesellschaft, International Finance Corporation, African Capitalization Fund Buy 34% of UT Bank of Ghana for $23m

Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG), a German development finance institution; the International Finance Corporation (IFC), the commercial arm of the US-based World Bank Group, and the African Capitalization Fund (ACF), a US-based investment fund managed by IFC subsidiary IFC Asset Management Company, recently placed an equity investment totaling approximately GHS 46 million (USD 23.3 million) in UT Bank Limited, a publicly-traded Ghanaian bank that offers microfinance services and was formerly known as Unique Trust Financial Services. DEG purchased a 13.5-percent stake in UT Bank, while IFC and ACF purchased stakes of 10.1 percent each.

As of December 2012, UT Bank reported total assets of GHS 987 million (USD 517 million), return on equity of 16.3 percent, 637 employees and 25 branches. In 2012, it generated total operating income of GHS 105 million (USD 55 million) and a net profit of GHS 21 million (USD 11 million).

As of December 2011, DEG, which is a member of Germany’s Kreditanstalt für Wiederaufbau (KfW) Bankengruppe, reported total assets of EUR 4.3 billion (USD 5.6 billion) and net profit of EUR 219 million (USD 285 million). As of 2012, IFC reported total assets of USD 75.7 billion. Between its launch in 2010 and September 2012, ACF made investment commitments totaling USD 61 million. ACF was launched and capitalized by five institutions: the African Development Bank (AfDB); the European Investment Bank (EIB); IFC; the OPEC Investment and Development Fund; and the Abu Dhabi Development Fund (ADDF).

By Nicole Boyd, Research Associate

About UT Bank Limited
UT Bank Limited, which was formerly named UT Financial Services Limited, is a publicly-traded Ghanaian bank managed by Ghana-based holding company UT Holdings Limited. Founded as Unique Trust Financial Services in 1997, the company changed names to UT Financial Services Limited in 2008, the same year it became listed on the Ghana Stock Exchange. The company became listed as UT Bank in 2010. It offers microfinance services in addition to traditional financial services. As of December 2012, UT Bank reported total assets of GHS 987 million (USD 517 million), return on equity of 16.3 percent, 637 employees and 25 branches. In 2012, it generated total operating income of GHS 105 million (USD 55 million) and a net profit of GHS 21 million (USD 11 million).

About Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG)
Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG), a member of Kreditanstalt für Wiederaufbau (KfW) Bankengruppe, is a German development finance institution offering long-term project and company financing. Sectors DEG invests in include agribusiness, financial institutions, infrastructure and manufacturing industries. As of December 2011, DEG reported total assets of EUR 4.3 billion (USD 5.6 billion) and net profit of EUR 219 million (USD 285 million).

About the Africa Capitalization Fund (ACF)
The Africa Capitalization Fund (ACF was established in 2010 with a target of USD 200 million to support and strengthen the banking sectors of African countries. ACF was launched and capitalized by five institutions: the African Development Bank (AfDB); the European Investment Bank (EIB); the International Finance Corporation (IFC); the OPEC Investment and Development Fund; and the Abu Dhabi Development Fund (ADDF). The fund is managed by the IFC Asset Management Company, which is a wholly-owned subsidiary of the IFC. ACF had made investment commitments totaling USD 61 million through September 15, 2012.

About International Finance Corporation (IFC)
A member of the US-based World Bank Group, the International Finance Corporation (IFC) offers loans, equity investments, advisory services and technical assistance to private companies with the intent of alleviating poverty and promoting open and competitive markets in developing countries. As of 2012, IFC reported total assets of USD 75.7 billion.

Sources and Additional Resources:

Ventures Africa. “IFC, Others Invest $20m In Ghanaian Microfinance Bank ,” http://www.ventures-africa.com/2013/04/ifc-others-invests-20m-in-ghanaian-microfinance-bank/

MicroCapital. April 16, 2013, “MICROCAPITAL BRIEF: National Insurance Commission (NIC) of Ghana Announces New Microinsurance Regulations,” https://www.microcapital.org/microcapital-brief-national-insurance-commission-nic-of-ghana-announces-new-microinsurance-regulations/

MicroCapital. January 3, 2012, “MICROCAPITAL BRIEF: Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG), European Fund for Southeast Europe (EFSE), European Investment Fund to Loan $38m to Alternatifbank A.S. (ABank) of Turkey,” https://www.microcapital.org/microcapital-brief-deutsche-investitions-und-entwicklungsgesellschaft-gmbh-deg-european-fund-for-southeast-europe-efse-european-investment-fund-to-loan-30m-to-alternatifbank-a-s-abank-of-tu/

MicroCapital. August 12, 2011, “MICROCAPITAL BRIEF: International Finance Corporation (IFC) Capitalization Fund, Africa Capitalization Fund (ACF) to Invest $10m in NBS Bank of Malawi for Lending to Small and Medium-Sized Enterprises (SMEs),” https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-capitalization-fund-africa-capitalization-fund-acf-to-invest-10m-in-nbs-bank-of-malawi-for-lending-to-small-and-medium-sized-enterprises/

MicroCapital Universe Profile: International Finance Corporation (IFC)
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=International+Finance+Corporation+%28IFC%29

MicroCapital Universe Profile: Africa Capitalization Fund (ACF) https://www.microcapital.org/microfinanceunivese/tiki-index.php?page=Africa+Capitalization+Fund+%28ACF%29

MicroCapital Universe Profile: Deutsche Investitions-und Entwicklungsgesellschaft GmbH (DEG) https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Deutsche+Investitions-und+Entwicklungsgesellschaft+GmbH+%28DEG%29

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