Swiss Investment Fund
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NMB Bank Nepal

NMB Bank Limited, headquartered in Kathmandu, is one of the leading commercial banks in Nepal. The bank operates in all of the country’s provinces through 163 branches and serves around 30,000 borrowers and one million depositors. NMB offers a wide range of financial services, including corporate banking, retail banking, cash management, remittances, trade finance and wealth management. In 2016, the Dutch development finance institution FMO increased its shareholding to 20% and signed a Joint Venture Agreement with the Bank and thus became the single largest shareholder. Over the past years, NMB Bank Limited has had steady portfolio growth and shown resilience amid a challenging operating environment.

NMB Bank Nepal

NMB Bank Limited, headquartered in Kathmandu, is one of the leading commercial banks in Nepal. The bank operates in all of the country’s provinces through 163 branches and serves around 30,000 borrowers and one million depositors. NMB offers a wide range of financial services, including corporate banking, retail banking, cash management, remittances, trade finance and wealth management. In 2016, the Dutch development finance institution FMO increased its shareholding to 20% and signed a Joint Venture Agreement with the Bank and thus became the single largest shareholder. Over the past years, NMB Bank Limited has had steady portfolio growth and shown resilience amid a challenging operating environment.

About the fund

A large portion of investments from international financial institutions to Nepal have traditionally focused on the development of the nation’s hydropower sector. SIFEM’s loan to NMB Bank Limited, however, will give the Bank greater flexibility to provide long-term financing to micro, small and medium-sized enterprises (MSMEs). This constitutes an opportunity to support the overall resilience and recovery of Nepal’s economy by promoting access to finance for businesses (SDG 9) and indirectly by supporting job preservation and job creation in the MSME sector (SDG 8).

This investment is also a pilot project for a new type of cooperation between SIFEM and the Swiss Agency for Development and Cooperation (SDC). The two partners have jointly elaborated a cooperation framework which allows for a first loss guarantee of up to 30% provided by SDC. With this risk buffer, SIFEM should be able to invest more in Least Developed Countries (LDCs) such as Nepal. The Federal Council’s Strategic Objectives for the period 2021-2024 require SIFEM to have at least 12% of its active commitments in Least Developed Countries (LDCs) and other Low-Income Countries by the end of 2024.

Reference code
2021-05
Status
Active
Date of commmitment
November 2021
Date of exit
-
SIFEM commitment
USD
12,000,000
Asset class
Private Debt
Investment strategy
Direct Investment
Fund manager
NMB Bank Limited