MICROCAPITAL BRIEF: International Finance Corporation (IFC) Acquires 15% Stake in National Bank of Vanuatu for $2.2m

The International Finance Corporation (IFC), the commercial arm of the World Bank Group, recently paid USD 2.2 million to acquire a 15-percent stake in the National Bank of Vanuatu, a financial institution that offers traditional banking services, microfinance and rural banking services in Vanuatu. The goal of the investment is to help the bank, which previously had been 100-percent government owned, to increase financial access in rural areas. IFC is co-investing in the bank with the Vanuatu National Provident Fund, a government-backed financial institution, which is also investing USD 2.2 million.

Bob Hughes, managing director of the National Bank of Vanuatu, reportedly said, “We believe that there is real demand for banking services in rural Vanuatu… IFC’s support will broaden our shareholder base and enable us to remain competitive while we continue to roll out our rural finance program.” IFC plans to advise the bank on risk management, corporate governance, internal audit and credit processes.

The National Bank of Vanuatu reported total assets of VUV 12.2 billion (USD 129 million) in 2011. As of 2012, IFC reported total assets of USD 75.7 billion.

By Nicole Boyd, Research Associate

About National Bank of Vanuatu
The National Bank of Vanuatu was established in 1991 with the government of Vanuatu as its sole shareholder. It was corporatized in 2012. The bank offers traditional banking services, rural banking services and a financial literacy education program for microenterprises from 28 branches and agencies. The bank reported total assets of VUV 12.2 billion (USD 129 million) in 2011. As of 2013, International Finance Corporation (IFC), the commercial arm of the World Bank Group, and the Vanuatu National Provident Fund, a government-backed financial institution, each hold 15-percent stakes in the bank.

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:

International Finance Corporation. “IFC Acquires Stake in National Bank of Vanuatu to Help Broaden Finance to Rural Areas,” http://www.ifc.org/ifcext/pressroom/IFCPressRoom.nsf/0/EAA509FDF28D0D6485257B17002657BB

MicroCapital. March 27, 2013, “MICROCAPITAL BRIEF: International Finance Corporation Invests $28m in Equity in Bhutan National Bank to Increase Financial Inclusion; Lending to Micro-, Small and Medium-sized Enterprises,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-invests-28m-in-equity-in-bhutan-national-bank-to-increase-financial-inclusion-lending-to-micro-small-and-medium-sized-enterprises/

MicroCapital. March 30, 2011, “MICROCAPTIAL BRIEF: International Finance Corporation (IFC) Extends $5m Trade Facility to Laxmi Bank of Nepal to Support Small Businesses,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-extends-5m-trade-facility-to-laxmi-bank-of-nepal-to-support-small-businesses/

MicroCapital. February 11, 2013, “MICROCAPITAL BRIEF: International Finance Corporation (IFC) to Donate $2m to Microinsurance Catastrophe Risk Organization (MiCRO) of Barbados, Insurer to Haiti’s Fonkoze,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-to-donate-2m-to-microinsurance-catastrophe-risk-organization-micro-of-barbados-insurer-to-haitis-fonkoze/

MicroCapital. February 8, 2013, “MICROCAPITAL BRIEF: International Finance Corporation (IFC), Yes Bank to Create Fund for Small Businesses in India,” https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-yes-bank-to-create-fund-for-small-businesses-in-india/

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

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