The Standard Bank Group announced today that it had been awarded a specialist Sub Saharan African debt mandate by the Overseas Private Investment Corporation (“OPIC”), a US development finance organisation backed by the US Government.
OPIC has committed up to $100 million in funding for the Standard Africa Development Fund. It is one of the first dedicated Sub Saharan African fixed income close ended vehicles and as such offers investors in the Middle East first-time access to one of most exciting economies globally through a secure fixed-income debt product.
The Fund’s goals are fourfold, namely:
1. Make attractive returns for investors on an annualised basis;
2. Provide private sector businesses within Sub Saharan Africa with a source of capital not presently available in this scale;
3. Encourage the investment of risk capital that will expand the breadth and depth of capital markets in Africa;
4. Encourage new primary debt issuance, with an aim of developing investment-led growth.
The Standard Africa Development Fund will invest in both external and local currencies in Sub-Saharan Africa, with the exception of South Africa. The focus will be on corporate debt, but the managers will also selectively invest in sovereign bonds. All investments will be subject to a socially responsible screening process.
Kevin Colglazier, Chief Investment Officer – Standard Asset Management, commented, “Africa is the ultimate frontier, it does not have a sub prime problem and the economy as a whole, excluding Zimbabwe, is expected to grow by over 6% during 2008. We believe that this is an ideal time to invest as one gets access to the ground floor of what is potentially a very profitable nascent opportunity.”
“Africa is attracting significant interest from Middle East investors who are seeing the opportunities available due to the better management of the countries’ economies and the abundance of mineral reserves on the continent.” added Alia Yousuf, Head of Emerging Market Debt at Standard. “Many of Africa’s economies have been experiencing their strongest growth in recent decades supported in part by the commodity boom but also due to the increased government investment in these countries.”
The Fund will be led by Kevin Colglazier and Alia Yousuf at Standard Asset Management in London and John Mackie at STANLIB Asset Management in Johannesburg. Both Standard Asset Management and STANLIB Asset Management are subsidiaries of the Standard Bank Group. The Fund heads will be supported by a dedicated unit and Standard Bank’s broader African team based in South Africa, Botswana, Namibia and Kenya.
John Mackie, Head of Africa Funds – STANLIB Asset Management also said, “The Standard Africa Development Fund follows on from the Standard Africa Equity Fund, which we launched in August last year. Several African markets have successfully navigated through the recent turmoil of the global economy and have demonstrated very impressive returns. “
Standard Bank, with its significant African presence is ideally placed to assist Middle Eastern Investors looking for African opportunities. With both a DIFC branch and a Representative Office Wealth Team, Standard regularly assists both high net worth individuals and corporate investors with their African investments.
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Notes to editors
The Standard Bank Group is headquartered in Johannesburg, South Africa and is listed on the Johannesburg Securities Exchange. It has offices in 38 countries throughout Africa, Europe, the Middle East, Asia and the Americas. It is the largest financial services organisation in South Africa and Africa. The Group’s business covers a broad range of activities in Corporate and Investment Banking, Personal and Business Banking and Investment Management and Life Insurance.
STANLIB is the third largest asset manager in South Africa with over US$45 billion assets under management. Headquartered in Johannesburg, South Africa, STANLIB has offices in 11 South African cities and has a presence in seven African countries. STANLIB offers collective investments scheme products (single and multi-manager, offshore and domestic), linked investment products and institutional investment solutions. STANLIB Asset Management Limited is registered as a Financial Services Provider with the Financial Services Board in South Africa.
The Overseas Private Investment Corporation was established as an agency of the U.S. government in 1971. It helps U.S. businesses invest overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers.
