The International Finance Corporation is considering providing a trade finance facility of up to $30 million to Banco de Fomento Angola to support cross-border trade and improve international financing access for Angolan businesses.
Structured under IFC’s Global Trade Finance Program, the facility would provide guarantees to international banks covering payment risks on trade instruments issued by BFA.
If approved, the guarantee line unfunded by IFC would cover trade finance instruments with tenors of up to 360 days, allowing international confirming banks to back letters of credit issued by BFA. This support helps Angolan companies import goods or export products while lowering perceived risk for foreign lenders.
The mechanism means IFC would only step in if BFA fails to meet its payment obligations, without disbursing funds directly. By leveraging IFC’s high credit rating, local banks gain access to trade finance lines that might otherwise be difficult to secure.
The initiative is part of IFC’s broader strategy to expand trade finance in emerging markets, targeting corporates and small- and medium-sized enterprises dependent on cross-border transactions.
Headquartered in Luanda, BFA is the country’s second-largest bank by deposits and loans, serving over 3.4 million clients through 160 branches as of mid-2025. Key shareholders include telecom operator Unitel (36.9%) and Portugal’s Banco BPI with a 33.35% stake.
In September 2025, BFA listed 29.75% of its shares on the Angolan stock market, drawing more than 8,000 investors in a rare local public offering.
Trade finance remains a major challenge across Africa, with multilateral institutions estimating a $100 billion gap due to limited dollar liquidity, stricter compliance rules, and difficulty assessing credit risk. In Angola, this has been compounded by limited direct links with U.S. banks following Deutsche Bank’s halt of dollar clearing for Angolan banks in 2016, forcing reliance on European intermediaries and higher costs.
Conditions began improving in late 2025 when JPMorgan resumed U.S. dollar clearing, restoring nearly a decade of disrupted transactions. Analysts say IFC’s guarantee could help Angolan banks rebuild correspondent banking ties and expand access to global trade finance, strengthening the country’s financial system and reconnecting it with international markets.