Bank Asia PLC and Eastern Bank PLC (EBL) have signed separate agreements with the International Finance Corporation (IFC), a member of the World Bank Group focused on the private sector in developing countries, to avail themselves of a total of $70 million in loans.

Sohail RK Hussain, managing director of Bank Asia; Ali Reza Iftekhar, managing director and CEO of EBL; and Allen Forlemu, regional industry director, Financial Institutions Group, Asia Pacific at the IFC, signed the deals in Dhaka.

Each bank will receive $35 million, the banks said in separate press releases.

Bank Asia said it would use the loan for capacity building in the micro, small, and medium enterprise (MSME) sector.

Meanwhile, EBL said it would use the loan to support its working capital and trade-related lending programme.

Ali Reza Iftekhar, managing director and CEO of Eastern Bank, and Allen Forlemu, IFC regional industry director of the Financial Institutions Group for Asia and the Pacific, pose for photographs after signing a $35 million loan deal at the bank’s head office in Dhaka yesterday. Photo: Eastern Bank

Bank Asia, with its strong balance sheet and nearly 8 million customers, is uniquely positioned to expand its SME portfolio by leveraging its agent banking network, said Hussain.

"Bank Asia is the pioneer of agent banking in Bangladesh," he noted.

"EBL is a strong partner of Bangladesh's development growth. This partnership with the IFC will help us extend working capital and trade finance solutions to local corporates and SMEs," said Iftekhar.

However, EBL stated that it currently manages 5 percent of the country's total trade business and considers small and medium-sized enterprises (SMEs) a core component of its growth strategy.

The bank also stated that it finances everything from large-scale infrastructure and manufacturing projects to complex trade transactions.

"IFC has been a steadfast partner in Bangladesh's financial sector, working to expand access to finance for micro, small, and medium enterprises, which are the backbone of the country's economy," said Forlemu.

The investment in the two banks is a part of the IFC's ongoing commitment to strengthening Bangladesh by providing much-needed liquidity to export- and import-oriented SMEs, he said.

Ensuring the resources will not only enable SMEs to grow, innovate, trade, and create jobs but also help them build long-term resilience, navigate evolving economic challenges, and foster sustainable economic development, he added.

Shafiuzzaman and ANM Mahfuz, additional managing directors of Bank Asia; Zia Arfin, senior executive vice-president; and Wilfried Tamegnon, manager of the Financial Institutions Group for Bangladesh, Nepal, and Sri Lanka, IFC, were present.