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Afreximbank Supports Fidelity Bank’s Expansion into UK with $40m

By Oluchukwu Ikemefuna

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Afreximbank, African Export-Import Bank declared the distribution of a $40 million Intra-African Investment Facility to Fidelity Bank Plc.

The investment is to support Fidelity Bank’s acquisition and recapitalization of Union Bank UK as part of its international development program.

Afreximbank Fidelity Bank UK Expansion

The investment was given in two tranches of $20 million each. The first tranche of the facility helped Fidelity to part-refinance the acquisition of a 100 percent equity stake in Union Bank UK.

Afreximbank Fidelity Bank UK Expansion

The second tranche was used to support its recapitalization via the injection of additional equity into the acquired bank, as approved by the United Kingdom’s regulator.

Afreximbank said in a statement on Monday that with the investment, Fidelity Bank can create a new pan-African outstanding financial institution. 

Benefits of The Afreximbank Fidelity Bank UK Expansion

This financial institution provides correspondent banking and offshore banking services to banks in Africa. It will also serve the banking needs of Africans in the diaspora.

Also Read: Spiro Raises $50m Debt Funding from Afreximbank to Expand Electric Vehicle in Africa

With the acquisition comes the anticipation of its contribution to Africa’s financial growth and development. The investment will increase intra- and extra-African trade finance and trade flows between Nigeria and the UK.

It will also support the integration of the African Diaspora into regional and continental supply chains.  

Additionally, it will encourage small and medium-sized businesses across the continent to improve their export competitiveness. Consequently bolstering their light export manufacturing capabilities.

The Managing Director and Chief Executive Officer of Fidelity Bank, Dr. Nneka Onyeali-Ikpe, thanked Afreximbank for supporting their expansionary initiatives. 

She stated that the refinancing would reveal additional value and create a scalable and sustainable service franchise. 

She highlighted that the service franchise would surely endorse trade businesses in Africa and diaspora banking.

The acquisition is a notable movement for both institutions as it creates trade opportunities at both ends. 

Mrs. Awani said, “Fidelity Bank’s acquisition of Union Bank UK aligned with Afreximbank’s Intra-African Investment Facility. It was a significant milestone for both institutions, reinforcing African ownership and control within the global financial landscape.

The Futuristic Impact Of The Expansion

As stated before, the acquisition is expected to contribute to Africa’s economic growth and development by increasing intra- and extra-African trade finance and trade flows between Nigeria and the UK. 

This investment creates opportunities for small and medium-sized enterprises to expand and do more. 

The acquisition will positively impact the African economy and bolster its manufacturing capabilities.   

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Abdullahi Kafayat
Abdullahi Kafayat

Abdullahi Kafayat is an enthusiastic writer interested in the tech world. She's a graduate of Obafemi Awolowo University and has a BSc in Chemistry. You can reach her at Kafayatabdullahi17@gmail.com.

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