Aureos Africa Fund invests $10 mln into HFC, backs expansion and SME lending

Aureos Africa Fund (“AAF”) has completed a US$10 million investment in HFC Bank Ghana Ltd (www.hfcbankgh.com), a commercial and retail bank. The investment in HFC will help the bank remain strongly capitalised as it continues the steady expansion of its branch network and of its lending to businesses and consumers.
AAF is managed by Aureos Capital Ltd (www.aureos.com), a private equity fund management company specialising in investing in small- and medium-sized businesses in emerging markets. This is the fund’s 12th investment.
HFC Bank provides microfinance and mortgage finance services, as well as conventional commercial and retail banking and corporate advisory work.
Jacob Kholi, Managing Partner of Aureos in West Africa, comments in a press release: “Whilst HFC is already a well established, well managed and profitable bank, there is significant scope for expansion. We think that a sensible and sustainable growth in their lending and deposit-taking activities would be a real benefit to both Ghanaian businesses and the wider Ghanaian economy.
“Our aim is to help HFC become one of the leading banks in Ghana and ensure it has the kind of financial strength needed to provide the loans and other banking products that are often in such short supply in this region.”
He adds that, as in many other regions, Ghana’s small- and medium-sized enterprises have been hindered from expanding by lack of adequate bank financing.
Asare Akuffo, Managing Director at HFC comments: “In recent years we have enjoyed rapid growth and are now arguably the most diverse financial institution in Ghana. However, our focus has always been on providing the best possible service to our customers. Thanks to this investment by Aureos we hope to be able to expand our product offering to even more potential customers across the wider West African region. We are delighted to welcome them on board.”
HFC Bank was formed in 1990 and listed on the Ghana Stock Exchange (www.gse.com.gh) in 1995. The bank existed as a mortgage finance institution until 2003, when it expanded into commercial and investment banking. It has 23 branches across Ghana, and with the investment from AAF the bank plans to open additional branches as it strategically expands its reach.
Aureos explains that their investment in HFC will also allow the bank to improve on its already robust systems, to improve operational efficiency, and to strengthen its Human Resources capacity.
Jacob Kholi adds: “HFC is fully committed to the principles and practice of good corporate governance. One of their key aims is to further improve their processes and operations to ensure they meet ISO banking standards, which include quality of communication with customers and commitments to data privacy. Aureos’ commitment to good practice, and expertise in these areas, will help HFC do that.”
Aureos was set up in 2001 and has increased funds under management to over US$1.2 billion and extended its geographical footprint to over 50 emerging markets, covering Asia, Africa and Latin America through establishing 16 regional private equity funds.
Institutional investors, bilateral and multilateral development finance institutions, pension funds, sovereign wealth funds, fund of funds, family offices and foundations and high net worth individuals are among the investors into Aureos’ funds.

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