The International Finance Corporation (IFC) has bought a 20 percent equity stake in the Rwanda Housing Bank (BHR) and also extended a $4 million (Rwf2.3 billion) loan to facilitate the transformation of the bank into a mortgage liquidity facility.
Government is in the process of transforming BHR into a mortgage liquidity facility that will support long-term lending activities by Primary Mortgage Lenders (PML) in the country.
The Ministry of Finance and Economic Planning said that IFC acquired the 20 percent shares at $1 million (Rwf572 million).
Angé Mutesi, the Communication and Public Relations Officer in the Ministry of Finance told Business Times that the IFC pledged to improve technical assistance to BHR, especially in the areas of corporate governance and systems.
The deal was signed last week by IFC’s Vice President and Treasurer, Nina Shapiro, and John Rwangombwa Rwanda’s Minister of Finance and Economic Planning.
“IFC will increase its investment and advisory programs in Rwanda to support the country’s impressive efforts in sustainable economic growth,” Shapiro said during her visit in the country.
She also hailed the innovative financing structures like the swap agreement that the IFC recently signed with the National Bank of Rwanda where the former will provide local currency loans to support the growth of Rwanda’s private sector.
Since no banks in Rwanda can provide such long-term swaps, the National Bank of Rwanda will provide IFC with local currency through swaps, until a commercial swap market develops.