Further to a review of its strategic approach to asset management, the Trade and Development Bank (TDB) redeemed the minority shares of its London-based partner GML Capital on June 30, thus emerging as the sole shareholder of Eastern and Southern African Trade Advisers Limited (ESATAL), which took effect on July 1.
The Eastern and Southern African Trade Fund (ESATF) has delivered a steady annual performance at 3.52 percent in 2021, clocking an absolute return of 11.50 percent since its inception while it has more than doubled its starting asset base to USD112mn, thus enabling TDB Group to help expand its trade finance operations beyond and to other African economies.
TDB Group President Emeritus and Managing Director Admassu Tadesse commented: “Throughout the years, TDB has not only spearheaded reforms but also made the shift into a group structure, heralding several subsidiaries, including ESATAL and to a wider geographic scope encompassing the COMESA-EAC-SADC Tripartite region, as well as to select African economies that aligns well with the AfCFTA ambitions. We are proud of our journey so far with ESATAL, and appreciate the GML Capital for their valuable contributions as an early-stage partner since ESATF was set up and launched”.
On the other hand, TDB Group Executive, Coverage Indian Ocean-Lusophone Africa Daniel Lam Chun told that leveraging TDB Group’s deep knowledge and expertise in trade finance asset class funding and with the involvement of the same senior executives and key staff in ESATAL implies that no transaction will be needed on the back of this transaction fitting with the fund’s activities and strategy remaining unchanged.
He added: “The ESATF will continue to invest in trade finance, structured commodity finance, export finance, and project-related finance transactions, armed with the objective to help expand the triple bottom line impact and extend the reach of TDB Group activities in the region it serves, while at the same time delivering steady returns with low volatility and an emphasis on impact investing”.
The Fund domiciled in Mauritius was launched in 2019 to help advance trade-led economic and social development by resorting to the financing of short-term to medium-term trade transactions in TDB Group member states and other select African economies, including SMEs. It is mentioned that the TDB Group lends to ESATF its expertise and knowledge spanning across the area of trade finance funding, accumulated over 35 years due to its 22 Member States where the asset classes pose as the primary investment mandate of the fund.
