AfDB’s Investment in TDB Green+ Shares for Climate Action

The African Development Bank Group (AfDB) has announced a subsequent equity investment of $15 million in the Trade and Development Bank Group’s (TDB Group) innovative Class C Green+ shares, aimed at bolstering clean technology and low-carbon initiatives within its member states. This additional capital, to be drawn from the Clean Technology Fund (CTF), will also facilitate the establishment of a project preparation facility to enhance investments in clean technologies.

The CTF, a component of the Climate Investment Funds, allocates resources to developing nations to amplify the adoption of low-carbon technologies with substantial potential for long-term reductions in greenhouse gas emissions.

According to Admassu Tadesse, President and Managing Director of TDB Group, this new equity bolsters TDB’s green growth and climate action agenda and reinforces our commitment to supporting member states in achieving their Nationally Determined Contributions.

TDB introduced these distinctive thematic equity instruments just over a year ago during COP27, and the African Development Bank responded with an initial investment of $15 million. The Class C Green+ shares empower TDB Group to amplify funds fourfold to support qualifying climate and Sustainable Development Goals (SDG)-aligned transactions in both the public and private sectors.

“We are pleased to secure this investment into our risk capital from CTF via our strategic partner, the African Development Bank. We appreciate the African Development Bank’s pioneering role, which has garnered significant interest from other investors and spurred this investment, aimed at delivering impact alongside attractive financial returns,” said Admassu Tadesse.

This fresh equity injection bolsters TDB’s commitment to green growth and climate action, reinforcing its efforts to assist member states in fulfilling their Nationally Determined Contributions. These investments are poised to advance TDB Group’s endeavors in climate action and SDG attainment across its member states, yielding substantial long-term reductions in greenhouse gas emissions.

Dr. Kevin Kariuki, Vice President for Power, Energy, Climate, and Green Growth at the African Development Bank, commended TDB for introducing this highly innovative class of shares, with all capital raised from strategic partners such as the African Development Bank and CTF, exclusively dedicated to climate action and sustainable development.

“This framework exhibits high replicability potential by optimizing the use of limited concessional funding and contributing to mobilizing substantial resources from the private sector,” added Kariuki. “We anticipate that CTF’s involvement will be pivotal in attracting additional investors to this class of shares and commend the establishment of the Project Preparation Facility catalyzed by this investment,” said Dr. Kevin Kariuki.

Mary Kamari, Executive for Corporate Affairs and Investor Relations at TDB Group, remarked, “While there is a significant need for additional capital to support climate action in Africa, we also face challenges related to the availability of bankable projects, with many initiatives faltering during feasibility and business planning stages. In this regard, we eagerly anticipate CTF’s technical assistance support to unlock new project opportunities in our region and amplify our impact in the climate sphere.”

TDB’s Class C Green+ shares build upon the success of Class B shares introduced a decade ago to attract institutional investors such as pension funds, insurance companies, sovereign wealth funds, development finance institutions, and others to TDB’s equity capital. These shares are accessible for investment by a wide array of impact investors.

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