Flame Tree Group has secured Sh905 million worth of credit from SBM bank to cushion the adverse effects of the Coronavirus pandemic. This is after the firm sought the credit line to improve its operational capital and maintain growth aid its loan restructuring plan.
In its latest annual report, FTG CEO Heril Bangera highlights the strategy behind the firm sought the credit line. As per the release, the credit line is part of the firm’s critical decisions to secure the viability of its 14 subsidiaries under the Flame Tree Group. This is alongside the credit letters, and asset financing.
“We are proud of the agreement we signed with SBM, and the confidence they have put in our Group. This has increased our funding capacity by 60 percent,” says Mr. Bangera.
A loan repayment moratorium running several months, budget cuts, and project postponements also feature in the credit line layout.
“In the view of the pandemic, a moratorium of several months for all due payments from April has been received from SBM and other banks,” says FTG.
The CEO expects the loan provision to protect the firm’s liquidity, ensure the supply of raw materials and operational survival in the coming months.