18 May 2009
The Abu Dhabi Group plans to finance small and medium-sized private healthcare projects in Pakistan through its Karachi-based Bank Alfalah's subsidiary.
Bank Alfalah carries out commercial banking operations through 282 branches in 75 cities in Pakistan. It will provide loans to private companies to establish hospitals, clinics, laboratories and pharmaceutical companies across the country, say sources familiar with the project.
The programme will boost the private healthcare sector in Pakistan, where government funding for healthcare has been shrinking. The UAE-based group owns, among other businesses, Alfalah Insurance in Pakistan.
The Alfalah bank is implementing the financing project with the help of the International Finance Corporation (IFC), the private investment arm of the World Bank Group.
"The proposed investment is a joint initiative of IFC's health and education and financial markets departments and involves the establishment of a risk-sharing facility with Bank Alfalah in Pakistan," said an IFC source.
"The facility is expected to be worth approximately $50 million (Dh184m) and will focus on making loans to private companies operating in the healthcare sector including hospitals, clinics, laboratories and pharmaceutical companies across Pakistan. The IFC has already approved an $20m uncommitted trade finance guarantee facility to Alfalah under the IFC's global trade finance programme."
The Abu Dhabi Group is one the largest UAE-based group of investors actively participating in investment activities in countries such as Pakistan, Bangladesh, Iran, Uganda, the Republic of Congo as well as the Middle East. The market value of the consortium's portfolio is said to be in excess of $10bn.
The group is the majority shareholder in Alfalah and has diversified interests in banking, telecoms, pharmaceuticals and property. It is considered one of the largest foreign direct investors in Pakistan. There are seven core investors from well-known business families in the UAE and the bank is listed on stock markets in Pakistan. The group has many high-profile projects in Pakistan in the construction and real estate, insurance and other sectors.
The IFC source added: "Under the proposed terms of the facility, Alfalah would be responsible for generating a portfolio of loans that satisfy certain criteria to be set by the bank and the IFC after the appraisal. The IFC's participation would involve taking responsibility for 50 per cent of risk associated with the senior tranche of that portfolio. This exposure would be protected by a first loss provided by AlFalah."
The project will improve health-related services in the country and complement the shrinking public sector expenditure that cannot keep up with the demand for health-related goods and services in Pakistan.
The bank has 48 Islamic branches and seven foreign branches in Bangladesh, Afghanistan as well as a wholesale banking unit in Bahrain.
The Abu Dhabi Group plans to finance small and medium-sized private healthcare projects in Pakistan through its Karachi-based Bank Alfalah's subsidiary.
Bank Alfalah carries out commercial banking operations through 282 branches in 75 cities in Pakistan. It will provide loans to private companies to establish hospitals, clinics, laboratories and pharmaceutical companies across the country, say sources familiar with the project.
The programme will boost the private healthcare sector in Pakistan, where government funding for healthcare has been shrinking. The UAE-based group owns, among other businesses, Alfalah Insurance in Pakistan.
The Alfalah bank is implementing the financing project with the help of the International Finance Corporation (IFC), the private investment arm of the World Bank Group.
"The proposed investment is a joint initiative of IFC's health and education and financial markets departments and involves the establishment of a risk-sharing facility with Bank Alfalah in Pakistan," said an IFC source.
"The facility is expected to be worth approximately $50 million (Dh184m) and will focus on making loans to private companies operating in the healthcare sector including hospitals, clinics, laboratories and pharmaceutical companies across Pakistan. The IFC has already approved an $20m uncommitted trade finance guarantee facility to Alfalah under the IFC's global trade finance programme."
The Abu Dhabi Group is one the largest UAE-based group of investors actively participating in investment activities in countries such as Pakistan, Bangladesh, Iran, Uganda, the Republic of Congo as well as the Middle East. The market value of the consortium's portfolio is said to be in excess of $10bn.
The group is the majority shareholder in Alfalah and has diversified interests in banking, telecoms, pharmaceuticals and property. It is considered one of the largest foreign direct investors in Pakistan. There are seven core investors from well-known business families in the UAE and the bank is listed on stock markets in Pakistan. The group has many high-profile projects in Pakistan in the construction and real estate, insurance and other sectors.
The IFC source added: "Under the proposed terms of the facility, Alfalah would be responsible for generating a portfolio of loans that satisfy certain criteria to be set by the bank and the IFC after the appraisal. The IFC's participation would involve taking responsibility for 50 per cent of risk associated with the senior tranche of that portfolio. This exposure would be protected by a first loss provided by AlFalah."
The project will improve health-related services in the country and complement the shrinking public sector expenditure that cannot keep up with the demand for health-related goods and services in Pakistan.
The bank has 48 Islamic branches and seven foreign branches in Bangladesh, Afghanistan as well as a wholesale banking unit in Bahrain.
By VM Satish
© Emirates Business 24/7 2009
