LONDON, ENGLAND — The European Bank for Reconstruction and Development (EBRD) is boosting export and import activities in Jordan by providing a $10 million trade facility to Capital Bank Jordan (CB) under the EBRD’s Trade Facilitation Program (TFP).
The TFP facility will enable CB to provide a wider range of trade finance products to its customers and to develop new products. The EBRD’s support will also allow CB to reach out to a broader range of companies engaged in cross-border trade.
Under this facility the EBRD will issue guarantees in favor of international confirming banks, taking the political and commercial payment risk of international trade transactions undertaken by these banks in the countries where the EBRD works.
“Supporting international and regional trade is key for the Jordanian economy and we are very pleased to engage with Capital Bank in strengthening this business,” said Heike Harmgart, EBRD head of office in Jordan.
“We are very pleased to sign this agreement with the EBRD and to participate in this program,” said Haytham Kamhiyah, chief executive officer of Capital Bank. “It will allow us to expand our network of services and to strengthen our relations in the field of international trade finance as well as with the joint venture banks in this program and the countries covered.”
Technical cooperation projects will accompany the trade finance facility, to transfer know-how and share best practice in trade finance.
Launched in 1999, the TFP aims to promote foreign trade to, from and among countries where the EBRD invests. Through the program, the EBRD provides guarantees to international confirming banks and short-term loans to selected banks and factoring companies for on-lending to local exporters, importers and distributors.
The TFP currently includes over 100 partner banks in 23 countries where the bank invests, with limits exceeding €1.5 billion in total, and more than 800 confirming banks worldwide.
Jordan became a member of the Bank in 2012 and to date the EBRD has committed €300 million across 19 projects in various sectors of the country’s economy. Through the EBRD’s Small Business Support programs the bank has also initiated 67 technical assistance capacity-building programs directly benefiting Jordanian small and medium-sized enterprises.
Capital Bank is the ninth-largest commercial bank in Jordan, with assets of $2.7 billion at the end of the first half of 2014. The bank is listed on the Amman Stock Exchange, with a market capitalization of approximately $394.2 million as of December 2014.