32359 - Amen Bank Equity

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Summary of Investment Information

Project Number

32359

Company Name

AMEN BANK SA

Date SPI Disclosed

Feb 1, 2013

Country

Tunisia

Region

Africa

Projected Board Date

Oct 18, 2012

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Sep 30, 2022

Department

Regional Industry - FIG Africa

Industry

Financial Markets

Previous Events

Approved : Oct 18, 2012
Signed : Jan 24, 2013
Invested : Jun 11, 2013

Sector

Commercial Banking - SME Finance

Project Description

The proposed project involves an equity investment in Amen Bank (the “Bank”). Amen Bank is the second largest private sector bank in Tunisia with a market share of loans of approximately 11%. The Bank is a full-service commercial bank operating in the country since 1971. The Bank’s operations consist of corporate, SME and retail lending and also includes specialized subsidiaries in Tunisia and Algeria.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	5.63

Development Impact

The project is expected to achieve a significant development impact at three levels:
- Contribute to increasing access to finance to micro, small and medium enterprises ("MSMEs") and job creation: Amen Bank has historically focused on the local corporate segment (namely SMEs). The proposed project is expected to support the Bank increase its SME lending operations, which in the medium run is expected to contribute positively to the job creation in the country.
- Contribute to increasing banking penetration: The proposed project will contribute to further developing access to banking services for retail clients in Tunisia in addition to local SMEs.
- Demonstration effect: Following the challenges in Tunisia in 2011 and the Eurozone economic downturn, the proposed project will be influential in restoring confidence in Tunisia and the MENA region and creating a demonstration effect for international investors and other IFIs to consider investing in the Tunisian banking sector.

IFC''s additionality in the proposed project with stem from the following:
(a) Mobilization: The capacity to mobilize other investors to provide a significant amount of capital at a time when the flow of foreign direct investment into the region is constrained.
(b) Opening the Bank''s shareholding to international investors: IFC''s equity investment will have a strong demonstration effect and send positive signals to help Amen Bank attract institutional investors of international standards.
(c) Strengthening risk management: IFC''s equity investment combined with a comprehensive risk management advisory program will strengthen the Bank''s risk management system and thus enhance its capacity to better serve its clients and improve its financial performance.
(d) Improving environmental and social standards: As IFC helps the Bank to develop an environmental and social management system in line with international best practices.

E&S Category Rationale / Risks and Mitigation

This transaction involves a Tier-III equity investment (up to 10%) into Amen Bank in Tunisia. Based on the overall portfolio risk of Amen Bank, which is considered to be medium, this project has been classified as Category FI-2 according to IFC’s Environmental and Social Review Procedure. As a universal bank, Amen Bank provides retail, SME and corporate financing with 42% of the portfolio entailing corporate financing and 40% entailing SMEs to key sectors such as real estate development (12.83%), transport and telecommunications (9.21%), trade (8.83%), and tourism (6.27%) with limited adverse E&S risk and impacts that are few in number, generally site-specific, largely reversible and readily addressed though mitigation measures. Exposure to high risk sectors such as mining, energy, chemicals and rubber, paper and printing accounts for less than 10% of the bank’s total portfolio. For this project, Amen Bank will be required to screen loans against the IFC Exclusion List, the E&S laws and regulations of Tunisia and the IFC Performance Standards.

The main E&S risks and impacts of the project derive from the ES& risks of Amen Bank''s lending activities, the capacity and systems in place to manage these risks, and the bank''s practices with regard to labor and working conditions. At present, the bank does not screen client activities against a list of excluded activities and it does not have a process for systematically integrating E&S due diligence into the overall credit review process and monitoring client performance. The bank’s labor practices are in compliance with the intent of Performance Standard 2 on Labor and Working Conditions.

Contacts

For Inquiries About the Project, Contact

Mr. Ahemd El Karm
President du Directoire

Amen Bank
Avenue Mohamed V
1002 Tunis, Tunisia
Tel: 71 148 841
Fax 71 833 517
E-mail: mailto:ahmed.elkarm@amenbank.com.tn

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Local Access of Project Documentation

None

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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 Title & Description	Anticipated Completion Date
Nominate officers
Establish SEMS
Develop guidelines
Staff Training
ESMS organization

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