The Development Bank of Rwanda (BRD Plc.) has signed an investment agreement with the African Local Currency Bond Fund (ALCB Fund), managed by Cygnum Capital, and reopened its second Sustainability-Linked Bond (SLB) issuance in Rwandan francs (Rwf) for an amount equivalent to $11 million (approx. Rwf16 billion). The reopening marks a milestone for Rwanda’s capital markets by bringing an international investor into a local-currency SLB, thereby widening BRD’s investor base beyond domestic markets. Hedging structure enabling international participation The international participation was made possible through a hedging solution arranged by TCX (The Currency Exchange Fund), with subsidy support from the European Commission’s EFSD+ Pricing Facility and the SDG7 Programme funded by Germany’s Federal Ministry for Economic Affairs and Climate Action (BMWK). The hedging solution will help protect the international investor from losses resulting from fluctuations in the value of the Rwandan franc against foreign currencies such as the US dollar. Linking finance to sustainability outcomes, boosting investor confidence in Rwanda The transaction builds on BRD’s Sustainability-Linked Bond programme and supports its strategy to mobilise long-term financing in local currency while linking funding to measurable sustainability outcomes. It reflects growing confidence in Rwanda’s development finance agenda and BRD’s role in structuring market-based solutions that attract private capital to priority sectors. “We are pleased to have participated in this innovative transaction with BRD. This thematic bond marks the ALCB Fund’s first investment in Rwanda, a country that remains of great interest to the Fund,” said Clemens Calice, CEO of Cygnum Capital, during the signing ceremony. “The success of this transaction reaffirms our view that Rwanda’s potential and prospects are attractive and that development banks of BRD’s stature play a crucial role in supporting broad-based inclusive economic growth.” Unlocking capital market growth through innovative financing Stella Rusine Nteziryayo, CEO of BRD, said the transaction is a milestone for both BRD and Rwanda’s capital markets. “By mobilising international capital in Rwandan francs, made possible through TCX’s subsidised hedging solution implemented for the first time in Rwanda, we have demonstrated that local currency issuers can access a wider pool of global investors when the right risk mitigation tools are in place,” she said. She noted that expanding long-term financing in Rwandan francs reduces currency risk while scaling up lending to priority sectors that generate jobs, promote exports and manufacturing, support affordable housing, and empower women-led enterprises. “The reopening of our second Sustainability-Linked Bond reflects market confidence and our continued commitment to measurable development impact,” she added. Alignment with Rwanda’s development agenda, commitment to future cooperation Ms. Nteziryayo further observed that the transaction is fully aligned with BRD’s mandate to mobilize private capital in support of Rwanda’s Vision 2050 and the National Strategy for Transformation (NST2). By linking financing costs to development impact and enabling international participation in local currency, the structure helps deepen the domestic debt market and offers a replicable pathway for future Rwanda franc issuances. BRD and Cygnum Capital reaffirmed their commitment to strengthening cooperation and exploring additional opportunities to scale sustainable local-currency financing solutions in Rwanda. About BRD Established in 1967, the Development Bank of Rwanda (BRD) is the country’s sole national development bank. BRD supports sustainable development by offering affordable, long-term, and tailored finance. Over the past decades, BRD has financed projects in key sectors, including infrastructure, agriculture, affordable housing, education, green finance, exports, and manufacturing. About Cygnum Capital and partners Cygnum Capital Group is an investment bank and asset manager operating across frontier and emerging markets. Formerly known as Lion’s Head and founded in 2008, Cygnum Capital manages a range of investment funds, including the ALCB Fund, and provides tailored and innovative financial solutions to meet the diverse needs of its clients. The African Local Currency Bond Fund was established by KfW in 2012 on behalf of the German Ministry for Economic Cooperation and Development (BMZ), with a dual mandate to support the development of domestic African capital markets while also channelling private-sector investment into SDG-aligned transactions whose ultimate beneficiaries are low-income households and MSMEs. The Currency Exchange (TCX) was founded in 2007 as a specialised fund that provides currency hedging instruments, such as swaps and forwards, to help international investors and development finance actors manage exchange-rate risk in frontier and emerging markets, thereby supporting long-term local-currency financing. TCX manages the BMWK SDG7 and EFSD+ programmes.
