ATIDI helps strengthen Benin's fiscal resilience with second-loss guarantee for Deutsche Bank's €507.5mln loan
This transaction benefits from a Partial Risk Guarantee (PRG) of EUR200 million provided by the International Development Association (IDA) and a second-loss insurance cover of up to EUR614 million (principal plus interest) from ATIDI for the tenor of the loan.
The facility will enable the Government of Benin to undertake a critical debt reprofiling exercise to buy back part of the country's Eurobonds. The resulting debt savings will be strategically allocated to finance or refinance eligible expenditures under the country's SDG Framework.
Nairobi — The African Trade & Investment Development Insurance (ATIDI) supported the Republic of Benin's latest financing transaction, providing a second-loss guarantee for Deutsche Bank's EUR 507.5 million loan to the country. This milestone transaction reinforces ATIDI's commitment to unlocking access to innovative financial solutions that enhance economic stability and sustainable development across Africa.
The senior unsecured amortizing term loan, arranged solely by Deutsche Bank, is backed by a first-loss guarantee of up to EUR200 million from the International Development Association (IDA), part of the World Bank Group. ATIDI's second-loss guarantee complements this structure, covering the remaining principal and interest, thereby strengthening investor confidence and reducing financing costs for Benin.
"This landmark financing demonstrates the power of strategic partnerships in unlocking sustainable investment for African economies. Our collaboration with Deutsche Bank in supporting the Republic of Benin highlights ATIDI's essential role in facilitating innovative financial solutions that enhance fiscal resilience. By providing a second-loss guarantee, we help ensure that Benin secures long-term, cost-effective financing, reinforcing its economic stability while channelling resources toward its sustainable development goals," ATIDI CEO Manuel Moses said.
ATIDI's involvement underscores its unique role in providing risk mitigation solutions that enable African sovereigns to access long-term, cost-effective financing on favorable terms. This transaction is the first IDA-backed guarantee under the World Bank's new guarantee platform launched in July 2024.
Key Highlights of the Transaction:
Debt Reprofiling - The facility will provide fiscal space for Benin to reprofile its debt, ensuring long-term financial sustainability.
SDG Alignment - Savings from the transaction will be channeled toward priority projects under Benin's SDG Framework.
Risk Mitigation - The IDA's Partial Risk Guarantee and ATIDI's second-loss insurance cover provide robust risk mitigation, enhancing investor confidence and ensuring the successful execution of the facility.
Commenting on the facility, Deutsche Bank Managing Director Maryam Khosrowshahi said the transaction consolidates the Bank's position as a leading arranger of complex transactions on the African continent, notably after being named Best Foreign Investment Bank in Benin for the 2nd year in a row by EMEA Finance African Banking Awards 2024.
'We are proud to have acted as sole mandated lead arranger and sole lender to the Republic of Benin on this novel transaction with IDA and ATIDI. We leveraged our successful financing track-record with the Republic of Benin as well as our excellent relationship with the Republic's advisor Rothschild & Co, and extensive transaction experience with the World Bank Group and ATIDI to deliver this critical financing in an effective and timely manner. Timing was indeed of the essence as the Facility was signed on 8 January 2025 concurrently to the announcement of a tender offer targeting up to EUR 250 million of Benin's EUR2032s notes and of a new USD 500 million bond issue to complement the country's 2025 budgetary needs.'
The facility was concluded in parallel with Benin's return to international capital markets through a USD500 million bond issuance. A portion of the loan proceeds was allocated to a debt reprofiling exercise, including the buyback of Benin's EUR 2032 bond. By extending the average maturity of its public debt portfolio and achieving substantial debt service savings, Benin can redirect funds toward strategic initiatives under its SDG financing framework, driving long-term social and economic impact.
ATIDI remains at the forefront of de-risking African economies and facilitating transformative financial solutions. Through partnerships with global financial institutions like Deutsche Bank and development partners such as the World Bank Group, ATIDI continues to provide innovative credit and investment insurance products that foster sustainable growth across Africa.
About ATIDI
ATIDI was founded in 2001 by African States to cover trade and investment risks of companies doing business in Africa. ATIDI predominantly provides Political Risk, Credit Insurance and, Surety Insurance. Since inception, ATIDI has supported USD85 billion worth of investments and cross border trade into Africa. For over a decade, ATIDI has maintained an 'A/Stable' rating for Financial Strength and Counterparty Credit by Standard & Poor's, and in 2019, ATIDI obtained an A3/Stable rating from Moody's, which has now been upgraded to A2/Positive.
www.atidi.africa
For further inquiries, please contact:
Lawrence Mensah | ATIDI| Kenya Re Towers, 5th Floor | off Ragati Road – Upper Hill| Email: lawrence.mensah@atidi.africa|
OR
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Zawya
2 hours ago
- Zawya
Sterling steadies after selloff, fiscal worries prevail
Sterling edged higher on Thursday, stabilising after fiscal concerns and uncertainty about Rachel Reeves' future as Britain's finance minister sparked a selloff across UK assets in the previous session. Markets had been monitoring developments around a welfare bill in parliament where divisions within the Labour party forced Prime Minister Keir Starmer to back down on large spending cuts, leaving a hole in public finances. The selloff gathered steam on fears that Reeves would be replaced, but was contained as Starmer gave the finance minister his full backing. The government has been trying to stick to its self-imposed fiscal rules to try to build investor confidence. However, analysts warn that politically-difficult tax hikes might be needed to balance public accounts and avoid extra borrowing. "The immediate issue is that the government left a very narrow margin in March against their fiscal rules they set themselves," said a group of analysts led by Jim Reid at Deutsche Bank. "So unless we got a big burst of growth before the budget, then the government would need to announce further tax rises or spending cuts if they still want to meet the fiscal rules." Sterling edged up 0.1% to $1.365 after sinking 0.8% in the previous session - its biggest daily drop in more than two weeks. The currency also firmed 0.3% against the euro , which last fetched 86.3 pence. The relief was also visible in bond markets, where the yield on the 10-year gilt dropped 9 basis points. Yields had spiked on Wednesday, with those on the benchmark note at one point registering their largest one-day jump since October 2022. Higher yields would generally support the domestic currency, so Wednesday's reaction highlighted investors' pessimism. Global investors have been grappling with ballooning public debt in developed markets and have also been demanding greater premiums to hold them. Yields on British bonds are among the highest in the developed world. Wednesday's plunge in British assets immediately drew comparisons with Liz Truss' short-lived premiership in 2022, which was derailed by a bond market selloff. Traders expect the Bank of England to cut interest rates by 25 basis points again in September, according to data compiled by LSEG. All eyes will now be on a pivotal U.S. jobs report later in the day that could help gauge the Federal Reserve's monetary policy trajectory. (Reporting by Johann M Cherian Editing by Mark Potter)
Broadcast Pro
4 hours ago
- Broadcast Pro
Viory expands outreach with new deals across Africa and Arab nations
The partnerships aim to strengthen cross-border media collaboration across Africa and the Arab world through content exchange, technological integration, and knowledge sharing. Viory, the video news agency focused on the Global South, has strengthened its presence across Africa and Arab-speaking countries by forging new alliances with leading regional media organisations. At the 25th Arab Radio and Television Festival hosted by the Arab States Broadcasting Union (ASBU) in Tunisia, Viory signed Memoranda of Cooperation with Agence Tunis Afrique Presse (TAP) and the O.I.C States Broadcasting Union (OSBU). These collaborations reinforce Viory's commitment to building cross-regional bridges between Africa, the Middle East, Asia and the broader Global South. TAP and OSBU are key players in developing regional media landscapes, and their collaboration with Viory underscores a shared commitment to content exchange, mutual growth, and technological advancement. Through its partnership with TAP, Viory plans to facilitate content sharing and joint projects that will enrich national media ecosystems and deepen understanding of local markets and cultural contexts. The agreement also establishes a framework for sharing knowledge and raising journalistic standards to meet the demands of the digital era. The newly formed alliance with OSBU, a network of broadcasting organisations representing O.I.C member states, will give Viory access to an extensive array of media outlets. This strategic collaboration is designed to enhance cross-border content distribution and foster cooperation on a broader scale across the Islamic world. Zulayho Siddikova, General Manager of Viory, said: 'These new partnerships with Agence Tunis Afrique Presse and the O.I.C States Broadcasting Union are instrumental to Viory's ambitious outreach into Arab world, African region and beyond. Following our successful Memorandum of Cooperation signing with the Ethiopian Broadcasting Corporation, these latest agreements reinforce our dedication to building a strong network of media partners across the Global South.' Siddikova added: 'We are excited to leverage these collaborations to deliver innovative solutions and high-quality content that empowers local media and connects communities.' Together, the new partnerships highlight Viory's expanding role as a cross-regional connector in today's multilingual and multicultural media environment.
Broadcast Pro
4 hours ago
- Broadcast Pro
Paratus launches EduLINK to bring Starlink internet to African schools
Through Paratus EduLINK, schools gain access to online learning, teacher training, digital assessments and collaborative projects, driving educational advancement and greater inclusion. Paratus Group, the pan-African telecommunications provider and authorised Starlink reseller, has unveiled Paratus EduLINK, a new connectivity initiative aimed at bringing high-speed internet to schools in underserved and remote areas across Africa. Under the campaign message Empowering Education, Anywhere, the programme aspires to make digital learning accessible to students regardless of where they live. EduLINK leverages Starlinks Low Earth Orbit (LEO) satellite technology to bypass the longstanding infrastructure challenges that have limited internet access in isolated communities. The service will initially be available in Botswana, Eswatini, Kenya, Malawi, Mozambique, Rwanda and Zambia. Schools holding a recognised Education Certificate can qualify for the package, which provides 2TB of Priority Data each month along with a generous buffer to maintain uninterrupted learning. The rollout includes the Standard Starlink Kitsold separately and installed by professionalsand is supported by local assistance, flexible payment options within each country, and dedicated customer care, a crucial component for institutions in regions with limited technical resources. This effort builds on Paratus extensive experience supporting digital education, most notably through a seven-year collaboration with Eduvision in Namibia. That partnership, which relied on geostationary satellite infrastructure, has reached over 12,000 students and 471 teachers, demonstrating clear improvements in engagement and academic performance. Paratus EduLINK is not just about connectivity, its about creating equal access to education, said Barney Harmse, Executive Chairman of Paratus Group. EduLINK joins a growing wave of initiatives across Africa that use high-speed satellite networks to close the digital divide in education. Other notable efforts include Intelsats partnership with the Whitaker Peace & Development Initiative to expand learning opportunities in East Africa; NigComSats EdTech Solutions programme in Nigeria; POULSATs collaboration with Eutelsat to connect schools in North Africa; and Avantis Project iMlango, which supplies high-speed internet to rural Kenyan classrooms using the HYLAS 2 Ka-band satellite. Collectively, these initiatives demonstrate the transformative role of satellite connectivity in delivering quality education to communities that have historically been left behind, underscoring a continent-wide movement to leverage space-based infrastructure for educational inclusion.
