MICROCAPITAL.ORG BRIEF: Citi Arranges $21.7m Syndicated Agricultural Loan to Microfinance Institution BURO Bangladesh

Citi has recently arranged a syndicated agricultural loan, which is a large loan made by multiple banks to a single borrower, to BURO Bangladesh, one of the country’s microfinance institutions (MFI). The 5-year loan of USD 21.7 million is claimed to be the “first ever syndicated agricultural term financing facility” in Bangladesh.  Executive Director of BURO Zakir Hossain stated that the increased funds will help BURO extend its services to more rural areas to increase food security throughout the country.

In addition to Citi, other lenders include Agrani Bank Limited, Citibank N.A., Dutch-Bangla Bank Limited, Eastern Bank Limited, Janata Bank Limited, Mutual Trust Bank Limited, Prime Bank Limited, Pubali Bank Limited, Sonali Bank Limited, Southeast Bank Limited, Standard Bank Limited, The City Bank Limited and United Commercial Bank Limited, according to the statement.

About BURO Bangladesh:
BURO Bangladesh, established in 1990, is a nonprofit microfinance institution that aims to develop infrastructure and facilities in Bangladesh, as well as create employment opportunities for clients. The organization has a Human Development program that involves skill development training and encouragement towards self employment in order to reduce intra- and inter-household income inequalities among its customers. BURO categorizes its customers, ages 18-60, into three segments: Very/extreme poor (owning less than .00006 acres of land and annual income equal to or less than USD 87 and having assets less than USD 174), moderate poor (owning less than 0.50 acres of land and annual income equal to or less than USD 261 and having assets less than USD 1447), and micro entrepreneurs and small & marginal farmers (owning more than 0.50 acres of land and annual income in the range of USD 261 – USD 868 and having assets in the range of USD 1447 – USD 4342). The organization has created six loan products, three savings products and one insurance scheme, while also launching a ‘disaster mitigation program’ to manage vulnerability shocks for clients.

About Citi Microfinance:
Citi Microfinance, part of Citi, works with over 100 microfinance institutions (MFIs), networks and investors as clients and partners in 40 countries. It aims to expand financial services available to the poor by offering various products and services, including financing, access to capital markets, transaction services, hedging foreign exchange risk, credit, savings, remittances and insurance products.

Bibliography:

[1] All Headline News. Citi Arranges Syndicated Agricultural Term Loan for MFI in Bangladesh. http://www.allheadlinenews.com/articles/7017019897

[2] BURO News. http://www.burobd.org/news.php

[3] Citi Bank Press Release. http://www.citibank.com/citi/press/2009/090708e.htm

[4] BURO Bangladesh. https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=BURO+Bangladesh

[5] Citi Microfinance. https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Citi+Microfinance

Original Source Article: Citi Arranges Syndicated Agricultural Term Loan For MFI In Bangladesh

Dhaka, Bangladesh (AHN) – Citibank, N.A. Bangladesh has arranged the country’s first ever syndicated agricultural term financing facility of $21.7 million (BDT 1.50 billion) for BURO Bangladesh, a leading microfinance institution (MFI).

Bangladesh Bank, the country’s central bank, Governor Atiur Rahman attended as the Chief Guest at the formal closing ceremony of this fund raising program held in the capital, Dhaka on Tuesday.

The 5-year local currency facility has been provided to the MFI to facilitate its expansion of micro-lending to the agriculture sector, a joint press statement said in Dhaka.

The central bank chief mentioned that the linkage, between commercial banking and SMEs small and medium enterprises in the agricultural sector, is very important to sustain the development of economy and ensuring food security of the large population of the country.

Commenting on this project, Executive Director of BURO Zakir Hossain said: “Buro Bangladesh is focused on ensuring food security through microfinance institutions and we appreciate Citibank and the participating banks for their contribution.”

Managing Director and Citi Country Officer – Bangladesh Mamun Rashid further added, “At Citi, we are much honored to arrange this syndicated agricultural loan which will provide assistance to a million, and this is yet another milestone in our partnership with the country’s microfinance sector.”

Besides Citi being the arranger, other participating lenders include Agrani Bank Limited, Citibank, N.A., Dutch-Bangla Bank Limited, Eastern Bank Limited, Janata Bank Limited, Mutual Trust Bank Limited, Prime Bank Limited, Pubali Bank Limited, Sonali Bank Limited, Southeast Bank Limited, Standard Bank Limited, The City Bank Limited and United Commercial Bank Limited, according to the statement.

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