The US development institution, the Overseas Private Investment Corporation (OPIC), is supporting the work of two United States firms who won a bid to recapitalise and restructure the Union Bank of Nigeria following a capital injection from the Central Bank of Nigeria to aid eight ailing banks during the global financial crisis of 2009.
OPIC will provide $250 million to the consortium of Keffi Group Ltd, Discovery Global Citizens Capital Partners, African Capital Alliance and ABC Holdings. This will be used to develop the bank and roll out new products such as mobile banking targeted at those Nigerians who do not yet have a bank account. Targeting the “unbanked” is seen as an effective way of formalising the grey economy and extending credit to those who would otherwise not be offered it.
OPIC President and CEO Elizabeth Littlefield explained:
“Union Bank of Nigeria serves close to a million depositors and hundreds of businesses – many of them small businesses – so the more efficient and profitable UBN becomes, the better able it is to fuel economic growth in Nigeria. We are particularly pleased that the project will result in greater availability of credit to ordinary Nigerians.”
OPIC is the US Government’s development finance institution and has a stated aim of advancing US foreign policy. Despite being an agency of the US government, OPIC is able to self finance through the use of private capital, independently helping US companies such as the Keffi Group and Discover Global Citizens Capital Partners to gain a foothold in the developing world.