Afreximbank and PTA Bank have closed a US$500mn dual-tranche syndicated loan facility for the Kenyan government.

Proceeds from the loan will finance logistics infrastructure projects in Kenya, with the aim of boosting intra-regional trade, according to Afreximbank’s president Benedict Oramah.

PTA and Afreximbank both acted as mandated lead arrangers, underwriters and bookrunners, while PTA Bank was the documentation and facility agent.

The facility comprises a US$200mn loan with a 10-year tenor, and a US$300mn five-year loan.

In a statement, Afreximbank says the facility sets “new tenor benchmarks for future borrowings by the government”, adding that “the longer tenors provide significant additional value to the government which has been seeking to gradually replace its shorter-term liabilities with longer dated ones”.

“This debt-raising exercise stands out in more ways than one: as an achievement in the syndicated loan market, as a confirmation of investor confidence for Kenya and as a further step towards better facilitation of inter-African trade,” Oramah says.

The facility is part of an overall US$1.55bn debt package for the Kenyan government, which includes a US$800mn dual-tranche two and three-year commercial loan arranged and underwritten by Citi, Rand Merchant Bank, Standard Bank and Standard Chartered, as well as a US$250mn two-year syndicated facility arranged and underwritten by PTA Bank.

PTA Bank is also known as the Eastern and Southern African Trade and Development Bank, but has recently rebranded as Trade Development Bank (TDB), which according to chief executive Admassu Tadesse represents the bank’s commitment to play a more active role in promoting trade, economic development and regional integration.

“TDB will continue financing trade, enterprise and infrastructure, which is evidenced in the tripling of our loan assets in the past two years in Kenya, a demonstration of the bank’s commitment to the Kenyan economy,” he says.