Kenya has picked Trade and Development Bank (TDB) and Standard Bank Group Ltd to help it raise $1 billion syndicated loans.
According to a Bloomberg, the president of TDB, Admassu Tadesse, confirmed the report saying, “We have that mandate alongside Standard Bank.”
A syndicated loan is a loan facility offered by several lenders to one borrower. Syndicated loans are offered in instances where the loan amount is too big to be issued by one lender.
The loan will come in three tranches; $250 million 10-year debt, $410 million 7-year debt, and € 300 million 7-year debt. Money raised through the syndicated loan will be used to repay existing loans and fund some projects. The country is expected to repay $2 billion worth of debt in 2019, and $1.28 billion in 2020.
Kenya’s treasury plans to raise $2.8 billion in the financial year 2018/2019 through external borrowing to bridge its fiscal deficit gap. In addition to the $1 billion syndicated loan, the country is in discussions to issue a $2.5 billion Eurobond.