The United Bank for Africa (UBA) Plc yesterday said it had entered into a partnership with the African Trade Insurance Agency (ATI) to ease the flow of credit to clients engaging in regional and international trade.
This came hours after the consensus forecast amongst 24 polled investment analysts covering UBA advised that the lender will outperform the market. According to Financial Times, this has been the consensus forecast since the sentiment of investment analysts deteriorated on March 04, 2013.
The previous consensus forecast advised investors to purchase equity in the bank. Meanwhile, the partnership according to a statement from UBA, was announced in Nairobi Kenya, after officials of both institutions, led by Mr. Kennedy Uzoka, CEO, UBA Africa and George Otieno, ATI’s Chief Executive Officer signed the pact to formalise the deal. Under the agreement, ATI will provide insurance cover for eligible UBA Group transactions with its unique range of political risk and trade credit insurance products.
The risk mitigation services will provide an alternative to collateral for UBA’s corporate clients, who may otherwise face financial constraints in obtaining credit, while also protecting them against cross-border trade risks and a broad range of investment risks.
Commenting on the partnership, Uzoka said: “UBA is keen to boost inter and intra-African trade because of its capacity to accelerate development and integration across the continent. Over the years, we have supported our customers to grow their business network across Africa and internationally in pursuit of a more prosperous Africa .
UBA’s partnership with ATI will ease the flow of credit to our customers and help them expand their businesses across the continent” He noted that intra-Africa trade was estimated to be one of the lowest globally at just 10 per cent of total trades on the continent, adding that this was quite low when compared with Intra-trade among the EU- 27 at 70 per cent, 52 per cent for Asian countries, 50 per cent for North American countries and 26 per cent for South American countries,” he said.
