Africa-Press – Malawi. Standard Bank Malawi has provided K21 billion out of the K34.5 billion earmarked for the rehabilitation of the Kenyatta Drive and Mzimba Street, which will be come Malawi Capital City’s first six-lane road.
Old Mutual and Continental Asset Management are co-financiers of the project with Government owned Roads Fund Administration (RFA) as a client. The signing of the K34.5 billion financing agreement was held on 9 February in Lilongwe.
Speaking during the signing ceremony, Standard Bank Board Chairperson Associate Professor Ngeyi Ruth Kanyongolo said the agreement underlines Standard Bank’s commitment to contribute to the country’s socio-economic development by financing key infrastructure projects.
Kanyongolo added that the road being funded by the bank and co-financiers offers many economic benefits to the nation including job creation, tourism attraction, boosting of commerce and injecting efficiency in the country’s transportation.
“The road, Kenyatta Drive and Mzimba Street is of strategic importance to Lilongwe as it connects the commercially oriented Old Town to the heart of the central business district of corporate and Government operations and international relations at the City Centre.
“The road also connects the City to Kamuzu Central Hospital and will therefore improve access to the hospital for patients especially in cases of emergency. The road will decongest Lilongwe and improve the City’s aesthetic look,” she said.
The deal itself is historic because it is the largest local-currency infrastructure financial transaction to be locally arranged in the Malawi market. According to Kanyongolo, the agreement, at a tenor of 15 years, is the longest tenor agreement concluded by any bank in Malawi.
It is also the first locally originated infrastructure transaction in which three financial institutions have partnered to deliver critical infrastructure for Malawi’s development.
“This deal is historic for the bank, our partners, the banking industry, the infrastructure sector and the nation as a whole.
“We are therefore delighted to partner RFA in this transaction. RFA’s ability to generate consistent cashflows through levies, the fact that it is excellently managed with clean audits stretching over 10 years was key in unlocking the funding to enable RFA accelerate its road construction activities,” said Kanyongolo.
She then expressed hope that the agreement will herald a new era of partnership among financial institutions to accelerate the nations development agenda.