RMB in $20m cross-border collaboration for African construction projects
Bank closes $20m facility for Dutch construction firm BAM International
Rand Merchant Bank (RMB) has closed a new $20-million letter of credit and performance bond facility for BAM International, a wholly-owned subsidiary of the Royal BAM Group, the largest construction company in the Netherlands. The facility will facilitate BAM’s construction projects in Ghana, Kenya and Tanzania, its key jurisdictions in Africa. It is required by BAM for demand guarantees, standby letters of credit, surety bonds and counter-indemnities for its projects in these countries. The lenders to the facility are FirstRand Bank and its subsidiaries in Ghana and Tanzania, allowing for flexibility as each entity can issue the instruments as required. FirstRand, through RMB, has implemented a master risk participation agreement (MRPA) with each of its subsidiaries to reduce complexity by facilitating issuance in-country and thereby reducing the time needed to transport the original documentation. The MRPA allows for the subsidiaries to issue instruments in excess of their regula...
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