HBZ Bank, South Africa

closed

On March 30, 2012, MIGA issued a guarantee of $12.5 million to Habib Bank AG Zurich (HBZ) of Zurich, covering its equity investment in its subsidiary HBZ Bank, South Africa (HBSA). The guarantee is for a period of up to 15 years against the risks of currency inconvertibility and transfer restriction, and expropriation. HBZ's equity investment will support the expansion of its branch network and commercial banking operations in South Africa. HBSA focuses on providing small to medium businesses in the manufacturing, property, retail/wholesale, and service sectors with deposit and checking facilities, long and short-term financing, and trade finance facilities. It also offers Islamic banking services and products. HBSA's focus on trade financing contributes to the increase in South Africa's exports, which provides a boost to the country's economic growth. In addition, Islamic banking products provide access to financing and banking services to a large portion of previously unbanked Muslim population of South Africa. The investment also supports the development of small and medium-size businesses, a large portion of the bank's clientele that might otherwise find it more difficult to obtain financing for their operations.

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