OREANDA-NEWS. March 30, 2015. Working on behalf of the Federal Ministry for Economic Cooperation and Development (BMZ), KfW Development Bank is providing support for the newly founded Development Bank of Nigeria (DBN) which is modelled on KfW. The German contribution from KfW's own funds is USD 200 million. Other international investors include the World Bank (USD 500 million), the African Development Bank (USD 50 million in equity capital and USD 450 million in debt capital) and the Agence Fran?aise de D?veloppement (USD 100 million in debt capital), while the Nigerian government itself has invested USD 300 million in equity capital.

The new bank will finance local commercial banks, micro banks and leasing companies throughout the country according to the proven on-lending principle. They, in turn, will grant loans to small and medium-sized enterprises in Nigeria, particularly in the agricultural sector, thereby improving their access to financing.

"KfW is proud to serve as a model for the formation of the bank in the largest national economy in sub-Saharan Africa. The new development bank aims to play a role in alleviating poverty, strengthening the potential of the private sector in Nigeria and enhancing the country's ability to compete. The growth of job-intensive small and medium-sized enterprises this brings about will have a stabilising impact and reduce conflict," said Dr Norbert Kloppenburg, member of the Executive Board of the KfW Group.

KfW will not only provide funding, but also supply know-how gained from its financing expertise in developing and emerging countries.

The DBN will place special emphasis on public-private partnership models. The equity and debt capital raised by the bank is targeted to reach a total of USD 1.4 billion by 2017. Another of the DBN's key tasks will be to bring the financing programmes that were previously managed by different institutions under one roof. The intention here is to provide effective support for the government's economic policies. All of the existing Nigerian funding initiatives will be merged under the bank's promotional programmes. In addition to the refinancing loan, KfW will use BMZ funds to support measures aimed at strengthening the bank's human resources and organisational capacities.