38415 - CAL Bank SME

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Summary of Investment Information

Project Number

38415

Company Name

CAL BANK LIMITED

Date SPI Disclosed

Oct 24, 2016

Country

Ghana

Region

Africa

Projected Board Date

Dec 2, 2016

Environmental Category

FI-2 - Limited

Status

Completed

Last Updated Date

Apr 7, 2023

Department

Global Industry, Financial Markets

Industry

Financial Markets

Previous Events

Approved : Dec 15, 2016
Signed : May 22, 2017
Invested : Jun 21, 2017

Sector

Commercial Banking - SME Finance

Project Description

A financing package of US$20 mn for CAL Bank Ghana Limited (“CAL Bank” or the “Bank”), a bank co-founded with Commonwealth Development Corporation (CDC) and African Growth Fund, in 1990, and in which IFC was a 25% shareholder until it divested in 2007. The investment comprises of a US$15mn 5 year senior loan to support the Bank’s lending to SMEs and a US$5mn trade finance to support the Bank’s trade finance business.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee	5.0
Loan	15.0
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
Straight Senior Loan	Loans to SME Borrowers

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

Development Impact

1. Access to finance - The proposed investment will widen access to finance for SMEs in Ghana, thereby increasing job creation and supporting economic growth.
2. Strengthening an important player in the banking sector - the project will improve CAL Bank''s profile and financial strength thereby increasing its competitiveness.
3. Demonstration effect - The project will play a catalytic role in increasing investments by other players in the Ghanaian financial sector.

1. Provision of long term funding for on-lending to the SME sector. This is critical to the development of the Ghanaian economy and for job creation.
2. Sector Development - IFC''s involvement continues to reinforce (i) commitment to the banking sector in Ghana (ii) validation of a strong bank in Ghana, (iii) IFC''s continuous efforts to strengthen international best practices in banking and E&S

E&S Category Rationale / Risks and Mitigation

This project has been provisionally classified as a Category FI-2 project according to IFC's Environmental and Social Review Procedure. CAL Bank is a universal bank which provides financial services predominantly to corporate and SMEs across a number of sectors, predominantly power & gas, construction, trading & wholesale and services. The E&S risks and impacts associated with these sectors are considered limited and can be readily addressed through mitigation measures. The Applicable Performance Requirements are the IFC Exclusion List, the applicable national social and environmental laws in Ghana and the Performance Standards.

The main E&S risks and impacts relate to the ability of the Bank to identify and manage the E&S risks associated with its lending activities. CAL Bank has an existing E&S risk identification and management system. CAL Bank will be required to revise its ESMS in line with IFC's requirements. The implementation of the ESMS has to be enhanced and integrated into the Bank's lending activities so as to ensure a more robust E&S risk management. There are satisfactory life and fire safety as well as emergency response procedures in place. The Bank's labor and working conditions policies and procedures will have to be revised to meet the requirements of Performance Standard 2. The Bank has an existing exposure to activities on IFC's Exclusion List.

Task Title & Description	Actual Due Date	Status	Comments	Completion Date
Staff Training		Pending
Other1 Revision of ESMS		Completed
Other2 Improved ESMS Implementation		Completed
Other3 Review of the External Communications Mechanism		Pending
Other4 Review of labor and working condition procedures		Completed
Other5 Approval of the revised ESMS by the Board		Completed
Other6 Staff training plan		Completed

Contacts

For Inquiries About the Project, Contact

CAL Bank
23 Independence AvenueP.O.Box 14596Accra, Ghana

Tel: +(233) 302 685091
http://www.calbank.net/calbank/Email: mailto:investorrelations@calbank.net

For Inquiries and Comments About IFC, Contact

General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster

Local Access of Project Documentation

Environmental Protection Agency
P.O. Box M326
Accra, Ghana
Telephone: +233 302 664 697/8

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.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

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.

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