IFC partners with Bank One Ltd. to strengthen its climate resilience in sub-Saharan Africa
22-03-2023 11:47:00 | by: Marlene Mutimawase | hits: 2285 | Tags:

To support the growth and sustainability of the banking sector in Mauritius and other sub-Saharan Africa countries, IFC and Bank One Limited signed a partnership to help the commercial bank better assess and mitigate climate-related financial risks across its business portfolio and strengthen its credit risk reporting practices.

Under the partnership, IFC will help Bank One to better recognize, measure, and monitor its portfolio's exposure to climate-related risks, thereby contributing to the growth and sustainability of its lending operations to businesses and individuals in Mauritius and other sub-Saharan Africa countries, including Kenya, Uganda, Tanzania, and Rwanda.

IFC will also help the bank strengthen its data collection, analysis, risk assessment, valuation, and reporting processes in line with international best practices and guidelines. To help Bank One improve its sustainability-based decision making and lend more to green projects, IFC will also help it estimate the carbon footprint of its business portfolio in sub-Saharan Africa.

"This is a first for Bank One and we are grateful for IFC's support and the trust of our various partners. This partnership aligns well with our environmental, social and governance strategy and our ambition to be a leading financial institution in climate financing in Mauritius and sub-Saharan Africa. We look forward to implementing a robust climate related and environmental financial management framework to ensure that the Bank can be best in class for its size and complexity," said Mark Watkinson, Chief Executive Officer of Bank One.

"A more climate resilient financial sector means a stronger, more sustainable financial sector that is better able to support economic growth," said Marcelle Ayo, IFC Country Manager for Mauritius. "IFC's partnership with Bank One reflects our strategy in Mauritius and elsewhere to help the financial sector to move towards sustainable and climate-resilient pathways."

Mauritius and other countries in sub-Saharan Africa are particularly vulnerable to the devastating impacts of climate change, including from rising sea levels, heavy rains, frequent storms, and flash floods.

Bank One and other banks around the world are susceptible to losses from the growing risks posed by droughts, floods, storms, and other weather-related events that are affecting their clients. These risks can potentially impair the value of financial assets and increase the cost of credit and operational costs. On the other side of the ledger, this presents opportunities for banks to boost revenue from climate change activity.

Bank One is an important banking institution in the region and supports economies in sub-Saharan Africa by providing access to key financial services, including loans, deposits, transaction banking, and trade. It has domestic retail, corporate banking operations and cross-border businesses across sub-Saharan Africa.

In 2019, IFC provided a loan of up to $37.5 million to Bank One to support the expansion of its lending operations to underserved segments, including small businesses.

The partnership aligns with IFC's Climate Finance Program in sub-Saharan Africa, which aims to support climate investments and help financial institutions to better integrate climate considerations in their lending, particularly to small businesses.

Bank One is a joint venture between CIEL Finance Limited in Mauritius and Kenya-based I&M Group PLC. Over the last decade, it has built a client base of over 50,000, a dedicated team of over 425 experienced collaborators and an asset base exceeding MUR 45 billion.

Bank One provides a wide range of banking products and services to its clients through a geographic footprint spread across the island of Mauritius, comprising of 7 branches and a well-distributed ATM network. It also plays an active role in supporting businesses in sub-Saharan Africa.

Bank One has deep development finance institution relationships and long-term funding lines in place with the International Finance Corporation (IFC), the German Investment Corporation (DEG), and the French Development Agency (Proparco).Bank One has been rated 'BB-' with a Stable Outlook by Fitch Ratings.