ABIDJAN, Ivory Coast, March 29, 2023/ -- The Board of the African Development Bank Group (www.AfDB.org) has approved $147 million in subordinated debt to the Mauritius Commercial Bank Ltd (MCB) to enhance its capital base and mobilize loan growth in the renewables, manufacturing healthcare and other sectors, including SMEs.

The debt will take the form of a Basel III Tier 2 compliant bond to be issued by MCB, a leading African financial institution and one of five banks classified as a Domestic Systematically Important Bank (DSIB) by Mauritius' central bank.

MCB has recently been expanding its footprint into several African countries and is also deepening its intra-African trade financing activities, which align with the African Development Bank's High-5 strategic targets, including to integrate Africa.

The financing is expected to catalyze additional deposits to expand MCB's loan book, benefiting several Mauritian and African corporates, as well as SMEs. Over the next 5 years, the funding is expected to help create thousands of jobs within Africa, thereby improving livelihoods of several African households.

MCB's Chief Executive Officer, Alain Law Min, said:  "This first Basel III Tier 2 bond issuance is a landmark transaction for MCB. The collaboration between MCB and AfDB has spanned over several decades and we are thankful to AfDB for their continued support and for their trust and confidence in our organization to deliver on our strategies.  This capital and funding instrument will finance high impact projects in the Sub-Saharan and Indian Ocean regions as MCB pursues its sustainable development agenda. Our strategy is also aligned with that of the African Development Bank, which takes a long-term view on the socio-economic development of Mauritius and the region. Finally, the success of this placement reflects the international recognition of the Bank's strong fundamentals, its investment grade ratings and investor confidence in MCB's growth potential.''

The bonds will be MCB's first capital markets excursion on a stand-alone basis. It will also be the first Basel III complaint bond to be issued in the Mauritius capital markets.

Leila Mokaddem, African Development Bank Director General for Southern Africa said "This support underscores our long-standing relationship with MCB, which dates back to 2002. We are proud to be associated with a key banking partner in Mauritius; its ambition to play a key part in Africa's development resonates very well with our development agenda."

Ahmed Attout, African Development Bank Acting Financial Sector Director, said the Bank was pleased to expand its relationship with MCB, which he described as a truly pan-African financial institution. The Bank is supporting introduction of a novel capital markets instrument in Mauritius and contributing to broadening the country's capital markets. "The investment objectives under this facility aligns with our priority development programs in Africa, including industrialization, renewable energy development and promoting SME growth."

MCB was founded in 1838 and is one of the continent's oldest banks. It operates under a universal banking model that incorporates retail banking, business banking, corporate and institutional banking. It offers a wide range of banking services to individual clients, SMEs (including women-owned business), corporates and other African banks through correspondent banking relationships to facilitate international trade financing activities. MCB specifically focuses on providing specialized finance solutions. These include structured commodity trade financing and project financing, especially within the power and infrastructure franchise.