This measure will facilitate the "commercial financing needs" of small and medium-sized companies "and, by extension, will strengthen the Angolan credit market", says a statement sent to VerAngola.
The note also reports that the AfDB will provide up to 100 percent guarantee "to the participating banks for the risk of non-payment resulting from the confirmation of letters of credit and similar commercial financing instruments issued by the BFA".
About the approval, Leila Mokaddem, general director of the Bank for Southern Africa, indicated that it allows the AfDB "to support the BFA in the financing of transactions related to trade".
"The approval of this facility by the Board of Directors allows the African Development Bank to support BFA in financing trade-related transactions, such as exports of agricultural products, imports of raw materials, among others," she said, quoted in the statement.
Thus, the note adds, this will reinforce BFA's capacity to finance commercial transactions for small and medium-sized companies and local companies, providing "an essential risk coverage to support the financing of the value chain, working capital and transactions of export import".
Ahmed Attout, responsible for the Financial Sector Development Department, said they were "enthusiastic" about the partnership, which will help BFA to expand "its support for commercial financing to critical sectors of the Angolan economy".
"We are excited about this partnership that will help BFA to increase its support for commercial financing to critical sectors of the Angolan economy, leveraging the capital relief provided by the ABA's AAA", he indicated, adding that "this is in line with the AfDB's focus in private sector development through the provision of support to the financial sector".
Also quoted in the statement, Pietro Toigo, Resident Representative of the Bank in Angola, said that "the approval of this operation is part of the efforts of the African Development Bank to support the growth of the private sector and economic diversification in Angola, and to expand the supply of credit to poorly served market segments".
