Ofid and StanChart extend trade risk programme
Standard Chartered Bank and the Opec Fund for International Development (Ofid) have increased their trade finance portfolio risk participation programme to US$1bn.
Under the programme, Ofid will provide trade guarantees for local banks in developing countries to improve capacity levels and increase confidence in local and regional trade flows. Standard Chartered will originate the transactions and act as the programme’s distribution agent.
The agreement has also been expanded to include more financial institution trade products, which will allow banks to access trade finance without the complexities of documentary credit, Standard Chartered says.
The programme initially offered up to US$50mn in risk-sharing guarantees when it launched in 2009. The renewed agreement is expected to generate approximately US$4bn a year in trade volumes and aims to benefit 150 banks in 25 countries.
George Nast, global head, products, transaction banking at Standard Chartered says: “Building on the success of the initial Ofid programme, this increase allows us to expand our capacity to support the growth of world trade flows and provide additional credit capacity for more banks to support trade transactions.”
“In times of increasing uncertainty, we want to continuously encourage global trade, the lifeblood of the globally economy, and continuously facilitate trade relationships and trade flows,” he adds.
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