Standard Bank, ICBC to raise R10bn for power projects

HARARE - Stanbic Bank Zimbabwe (Stanbic) parent company, Standard Bank Group,  is set to assist its major shareholder, the Industrial and Commercial Bank of China (ICBC), raise R10 billion for power generation.

The South Africa-based bank’s chief executive Sim Tshabalala said the deal was in support of the development of South Africa’s power generation infrastructure over the next five years, a deal which could see Zimbabwe benefitting from power imports.

“Strategic cooperation between ICBC and Standard Bank has enabled us to arrange more than $7 billion in loans to African countries and to complete over $14 billion of transactions.

“These have brought equity and debt capital from Chinese corporations and financial institutions to Africa,” he said on the side lines of the recently-ended Focac Summit.

According to Tshabalala — Standard Bank acting as arranging and structuring adviser — will assist ICBC in raising up to R10 billion from the financial markets over the five-year period.

This follows the signing of a collaboration agreement between ICBC and Standard Bank in the presence of President Xi Jinping of China and South Africa’s President Jacob Zuma at the Focac Heads of Summit in Sandton, Johannesburg.

Tshabalala also said the ICBC-Standard Bank partnership was going to jointly support up to 100 new infrastructure and industrial projects across Africa, ranging from resources and transportation, to electricity and telecommunications, to manufacturing and industrial parks.

“While much of our joint work so far has been in corporate and investment banking, ICBC and Standard Bank are increasingly exploring opportunities to expand cooperation into new areas of business,” he said.

Electricity shortages have in recent weeks severely affected some Southern African Development Community (Sadc) member states leading to scheduled and, in some cases, unscheduled power cuts.

From last year, load-shedding has been introduced in countries such as Namibia, South Africa, Zambia and Zimbabwe.

In Zimbabwe, government has been instituting power cuts of up to 18 hours per day, with the situation not very different in South Africa.

However, Tshabalala said the infrastructure venture with the ICBC was going to see South Africa exporting power to neighbouring countries, Zimbabwe included.

Presently, local miners are in talks with South Africa’s power utility for a power importation arrangement.

Tshabalala said that ICBC had identified Africa as an important growth market long before it was fashionable for global banks to do so.

“ICBC recognised that its own expansion into the continent would be best served by creating a strategic partnership with a large and well-established African financial services group.

“So the largest bank in the world teamed up with the largest bank in Africa in 2009, when ICBC bought a 20 percent stake in the Standard Bank Group, becoming our single largest shareholder,” he said.

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