IFC and Bank One Limited has inked a partnership deal to help the commercial bank better assess and mitigate climate-related financial risks across its business portfolio, as well as strengthen its credit risk reporting practices, to support the growth and sustainability of the banking sector in Mauritius and other Sub-Saharan African countries.
IFC will assist Bank One in better recognizing, measuring, and monitoring its portfolio’s exposure to climate-related risks, contributing to the growth and sustainability of its lending operations to businesses and individuals in Mauritius and other Sub-Saharan African countries such as Kenya, Uganda, Tanzania, and Rwanda.
In addition, the IFC will assist the bank in improving its data collection, analysis, risk assessment, valuation, and reporting processes in accordance with international best practices and guidelines. IFC will also assist Bank One in estimating the carbon footprint of its business portfolio in Sub-Saharan Africa in order to help it improve its sustainability-based decision making and lend more to green projects.
“This is a first for Bank One, and we appreciate IFC’s assistance and the confidence of our various partners. This collaboration is in line with our environmental, social, and governance strategy, as well as our goal of becoming a leading financial institution in climate finance in Mauritius and Sub-Saharan Africa. We are excited to put in place a strong climate-related and environmental financial management framework to ensure that the Bank is best in class for its size and complexity “Bank One CEO Mark Watkinson made the statement.
“A stronger, more sustainable financial sector is better able to support economic growth,” said Marcelle Ayo, IFC Country Manager for Mauritius. “The IFC’s partnership with Bank One reflects our strategy in Mauritius and elsewhere to assist the financial sector in transitioning to more sustainable and climate-resilient pathways.”
Mauritius and other Sub-Saharan African countries are especially vulnerable to the devastating effects of climate change, which include rising sea levels, heavy rains, frequent storms, and flash floods.
Bank One and other banks around the world are vulnerable to losses as a result of the growing risks posed by droughts, floods, storms, and other weather-related events that affect their customers. These risks have the potential to reduce the value of financial assets while also increasing the cost of credit and operational costs. On the other hand, this provides opportunities for banks to increase revenue from climate change activity.
Bank One is a significant regional banking institution that helps sub-Saharan African economies by providing access to key financial services such as loans, deposits, transaction banking, and trade. It has domestic retail, corporate banking, and cross-border operations in Sub-Saharan Africa.
In 2019, IFC provided Bank One with a loan of up to $37.5 million to help it expand its lending operations to underserved segments, including small businesses.
The collaboration is in line with the IFC’s Climate Finance Program in Sub-Saharan Africa, which aims to support climate investments and assist financial institutions in better incorporating climate considerations into their lending, particularly to small businesses.
Bank One is a partnership between CIEL Finance Limited in Mauritius and I&M Group PLC in Kenya. Over the last decade, it has grown to over 50,000 clients, a dedicated team of over 425 experienced collaborators, and an asset base worth more than MUR 45 billion.
Bank One offers a diverse range of banking products and services to its clients via a geographical footprint that spans the island of Mauritius, with 7 branches and a well-distributed ATM network. It is also actively involved in assisting businesses in Sub-Saharan Africa.
Bank One has long-term funding lines and deep relationships with the International Finance Corporation (IFC), the German Investment Corporation (DEG), and the French Development Agency (Proparco).
Fitch Ratings has assigned Bank One a ‘BB-‘ rating with a Stable Outlook.