31696 - DTBT Tier I & II

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Summary of Investment Information

Project Number

31696

Company Name

DIAMOND TRUST BANK TANZANIA LTD

Date SPI Disclosed

Mar 26, 2013

Country

Tanzania

Region

Africa

Projected Board Date

Apr 28, 2013

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Jun 17, 2021

Department

Regional Industry - FIG Africa

Industry

Financial Markets

Previous Events

Approved : Jun 3, 2013
Signed : Dec 30, 2013
Invested : Jun 24, 2014

Sector

Commercial Banking - General

Additional Project Attributes

Blended Finance

Project Description

The total project cost and proposed IFC investment is $5 million. IFC will finance the above amount in the form of a Subordinated Loan that qualifies for Tier II capital.

The above Subordinated Loan will be utilized to: (i) strengthen Diamond Trust Bank Tanzania Limited’s (DTBT) capital base; and (ii) assist in DTBT’s increase in lending to the SMEs.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	5.09
Equity

IFC's loan to the financial institution described in this SII is targeted for on-lending to the following sector(s):

Product Type	Use of Proceeds
Quasi-Equity	Loans to SME Borrowers
Quasi-Equity	Loans to SME Borrowers

IFC's Definitions of Targeted Sectors can be found here.

Development Impact

The Project is expected to have a high development impact in the following measurable areas:

1. Increasing credit availability to the SMEs.
2. Supporting job creation through providing long term financing to the SMEs.
3. Growth in bank''s profitability which is expected to be achieved through strengthening DTBT''s capital base, and as a result higher taxes to the Government.
5. Demonstration effect/market transformation through DTBT''s continued lending to the target segment beyond the life of the Project.

The Project is expected to have the following additionality:

1-Providing long-term subordinated debt.
2-Providing long term funding that will assist DTBT to strengthen its capital base;
3-IFC has worked with DTB Group member banks under the African Micro, Small and Medium Enterprises (AMSME Program) to strengthen the banks'' institutional capacity to sustainably provide financial services to the SMES. The proposed long-term funding to DTBT will be used as a platform to further deepen the long-term strategic partnership between IFC and DTB member banks (including DTBT) across Eastern Africa Countries to promote grow and promote sustainable practices in the banks'' business.

E&S Category Rationale / Risks and Mitigation

This project has been classified as a Category FI-2 project according to IFC’s Environmental and Social Review Procedure. DTB Tanzania (DTBT) provides banking services to individual clients, SMEs and larger corporate clients across a number of industry sectors such as construction, hotel and tourism industry, transport, telecommunication, wholesale and retail trade. The applicable E&S requirements are: the IFC Exclusion List, relevant E&S national social and environmental laws in Tanzania and, in case of larger corporate lending or project finance, IFC''s Performance Standards.

The main E&S risks and impacts relate to DTBT’s ability to identify and manage the risks associated with its lending activities, in particular larger corporate lending. DTBT has not established an ESMS for its operations yet but is expected to adopt the DTB Group ESMS to ensure that its lending activities are in compliance with the Exclusion List, relevant E&S national laws and regulations as well as Performance Standards in case of project /large corporate finance. In particular, as part of the ESMS roll-out the bank will: (i) appoint an E&S Officer ; (ii) design E&S procedures that are tailor-made for its operations in Tanzania, and (iii) ensure that all members of staff responsible for the implementation of the ESMS are properly trained. DTBT''s practices related to labor and working conditions are largely in line with requirements of the Performance Standard 2.

Contacts

For Inquiries About the Project, Contact

Mr. Viju Cherian, Chief Executive Officer, Diamond Trust Bank Tanzania Limited
901, Harbour View Towers
Samora Avenue
P.O.Box 115, Dar Es Salaam
Tanzania
Tel: + 255 22 212 8888
Fax: +255 22 212 4244

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Washington DC 20433
Telephone: 202-473-3800
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Local Access of Project Documentation

IFCDocs (Project # 31696)

Mr. Viju Cherian, Chief Executive Officer, Diamond Trust Bank Tanzania Limited
901, Harbour View Towers
Samora Avenue
P.O.Box 115, Dar Es Salaam
Tanzania
Tel: + 255 22 212 8888
Fax: +255 22 212 4244

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

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CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

Task Description	Anticipated Completion Date
Nominate E&S Officers/Department	On or prior to Commitment
Adopt DTB Group ESMS	On or prior to Commitment
Prepare Staff Training Plan	On or prior to Commitment
Implement Staff Training	Within 6 months after Disbursement
Provide ESMS Implementation Report	Within 6 months after Disbursement

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