The OPEC Fund boosts renewable energy and access to finance in Nepal
PR89416
VIENNA, May 10, 2021 /PRNewswire=KYODO JBN/ --
The OPEC Fund for International Development (the OPEC Fund) has signed a US$15
million loan in favor of NMB Bank Limited in Nepal for the purpose of financing
micro-, small- and medium-sized enterprises (MSMEs) and renewable energy
projects. The loan represents the OPEC Fund's first financial institution
transaction in the country.
MSMEs currently constitute more than one-third of NMB Bank's total loan
portfolio (approximately 4,800 borrowers) and the bank is working toward
increasing its MSME base. NMB is also already one of the leading finance
providers for local renewable energy providers in Nepal. Its renewable energy
portfolio consists primarily of hydro projects (over 90 percent of its
renewable energy portfolio) and total committed limits for renewable energy
stand at approximately 17 percent of its total loan outstanding book.
"There is a significant gap between the MSME sector's supply of finance and the
demand for credit," says the OPEC Fund's Assistant Director-General, Private
Sector and Trade Finance Operations Tareq Alnassar. "Also, the current lack of
access to reliable, grid-supplied electricity and the reliance on power imports
are constraining economic growth and poverty reduction in Nepal.
"The OPEC Fund is excited to be working with NMB to support such integral
sectors," continued Alnassar. "This transaction - our first of this nature in
Nepal - aligns with our support for the United Nations Sustainable Development
Goals (SDGs) and with SDGs 1, 7 and 8 on ending poverty, providing affordable
and clean energy, and supporting decent work and economic growth, in
particular."
Sunil KC, Chief Executive Officer of NMB Bank, said: "The financing from the
OPEC Fund will allow us to support the real economy in Nepal by strengthening
employment and renewable energy generation, for which Nepal has tremendous
potential. In turn, this makes us less reliant on imports and helps us become
more self-sufficient and sustainable.
"Our belief in 'banking on values' means NMB does business in a way that makes
us accountable to society and more focused on developmental impact," KC
continued. "This is in line with the OPEC Fund's values and this common
approach defines our partnership."
NMB Bank was established in 1996 as a merchant bank and in 2008 expanded into
commercial banking. In 2015, it underwent a merger with four other financial
institutions to create its current form as a universal bank. NMB is now Nepal's
7th largest commercial bank in terms of asset size.
The OPEC Fund has supported development in Nepal since the organization's
inception in 1976. To date, the OPEC Fund has committed more than US$224
million to the country via public sector financing.
About the OPEC Fund
The OPEC Fund for International Development (the OPEC Fund) is the only
globally mandated development institution that provides financing from member
countries to non-member countries exclusively. The organization works in
cooperation with developing country partners and the international development
community to stimulate economic growth and social progress in low- and
middle-income countries around the world. The OPEC Fund was established by the
member countries of OPEC in 1976 with a distinct purpose: to drive development,
strengthen communities and empower people. Our work is people-centered,
focusing on financing projects that meet essential needs, such as food, energy,
infrastructure, employment (particularly relating to MSMEs), clean water and
sanitation, healthcare and education. To date, the OPEC Fund has committed more
than US$22 billion to development projects in over 125 countries with an
estimated total project cost of US$187 billion. Our vision is a world where
sustainable development is a reality for all.
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SOURCE: The OPEC Fund for International Development
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