Brac Bank to get $30m from British financier

CDC Group, the UK government's development finance institution, yesterday announced to invest $30 million (over Tk 25 crore) in Bangladesh's Brac Bank.

Bangladesh presents significant opportunities for entities like CDC Group, in financial services, infrastructure and manufacturing, said its chief executive, Nick O'Donohoe.

The country has received just $150 million or less than one percent of the CDC's investment portfolio of $6 billion and the CDC expects it to significantly grow as the institution aims to double its investments over the next three to four years, he said.

O'Donohoe's comments came at a discussion organised at The Westin Dhaka to make public its debt commitment to Brac Bank.

"The CDC's capital would help Brac Bank increase its lending programme to export-led and other businesses to accelerate their growth, advance employment and positively contribute to Bangladesh's economy," said a statement issued by CDC.

It was important for the CDC capital to reach those entities to create jobs and help organise private equity and venture capital funds which can provide small amounts of investments to those growing companies, said O'Donohoe.

Bangladesh offers huge opportunities for its growth and skills, especially considering the need for further capital with foreign direct investment being below 1 percent of the GDP, said Graham Wrigley, chairman of CDC Group.

The country has a more developed debt market than it has of equity and the CDC thinks that in the next five to 10 years a lot of the Bangladeshi companies will want to raise equity through the capital market although they are not used to the process, he said.

The challenge is to provide a vibrant capital market for investors, said Srini Nagarajan, managing director of CDC India Advisers.

He said CDC made its first investment in Bangladesh in 1980 with $1 million for IPDC and supported funds for Runner and Butterfly.

The CDC statement mentions of its previous investments in Bangladesh such as $15 million for RFL Electronics in 2017, $103 million for a 414 megawatt energy project in Sirajganj in 2016, $25 million for Grameephone in 2013 and $20 million for Frontier Bangladesh II in 2015.

The officials informed of Rehan Rashid being recently appointed as CDC country director for Bangladesh.