Multinational - First Rand Bank SA (FRB)

The present operation relates to the renewal of an existing USD 100 million Risk Participation Agreement (RPA) for FirstRand Bank Limited (FRB). This should help to share the default risk on a portfolio of eligible Trade Finance (TF) instruments originated by African issuing banks (IBs) and confirmed by FRB. Under this RPA, the Bank’s risk exposure will not exceed 50% of the total exposure on any underlying transaction at any point during the tenor of the facility. However, in line with the Trade Finance operational guidelines, IBs from LICs and/or fragile states will be included for an exceptional 75% risk participation cover. This facility will help to promote broad-based economic growth on the African continent through increased facilitation of import-export activities by African corporates and SMEs and increase intra-Africa trade and regional financial integration (regional integration) in line with the Bank’s Hi5 strategic objectives. It will help enhance FRB’s risk-bearing capacity and by extension its ability to provide risk mitigation support for trade-related transactions originated by issuing banks across Africa.