GuarantCo has signed an agreement with a fund management company, owned by Standard Bank Group, FMO and Emerging Markets Partnership, to manage GuarantCo’s guarantee operations on a global basis.

GuarantCo is sponsored by the governments of the Netherlands, Sweden, Switzerland and the UK. Its primary purpose is to provide credit enhancement of infrastructure financings in lower income countries. While there are a number of banks and agencies, both in the private and developmental sectors, which focus on infrastructure finance, GuarantCo stands out in that it deploys guarantee products exclusively to support finance in local currencies.

In most cases, infrastructure providers prefer to match their financing costs with the currency of their revenues. Local capital markets in lower income countries are often constrained in terms of capacity and tenors, but GuarantCo can unlock these potential sources of finance through various forms of credit enhancement.

This not only achieves the immediate objective for borrowers of matching financing costs to revenue but also helps reduce lower income countries” reliance on hard currency debt and can lead to increased depth in local capital markets over time.

Standard Bank has recently recruited Chris Vermont who will be responsible for leading GuarantCo’s new business origination, capital markets product development/liaison with market regulators and leveraging shareholder equity.

Vermont was formally with ANZ where he was head of project and structured finance and latterly head of debt solutions and distribution.

The GuarantCo team includes Douglas Bennet (formally with FMO and Cadwaladers) and will report to Nick Rouse who also has responsibility for the Emerging Africa Infrastructure Fund.