BADEA Injects $120M into Shelter Afrique to Boost Affordable Housing in Africa
The Shelter Afrique Development Bank (ShafDB) has secured a significant USD 120 million concessional loan facility from the Arab Bank for Economic Development in Africa (BADEA), aimed at supporting its ambitious capital increase program.
The announcement was made today following the official signing of a strategic agreement between the two institutions, marking a pivotal step in bolstering ShafDB’s financial capacity to scale affordable housing and sustainable urban development across Africa.
According to the agreement, the concessional financing will be used by eligible member states to settle and increase their capital subscriptions to ShafDB. The initiative introduces a novel on-lending mechanism that allows these countries to access capital at competitive terms, further reinforcing their commitment to affordable housing development.
“This agreement with BADEA marks a critical step in strengthening our capital base and advancing our mission of financing affordable housing and sustainable urban infrastructure across Africa,” said Thierno Habib-Hann, Managing Director of Shelter Afrique Development Bank. “We are grateful to BADEA for its strong partnership and unwavering support in this pivotal phase of our institutional evolution.”
The new capital increase program features a structured allocation system, beginning with an equal distribution to all member states. This is followed by a phased reallocation: first on a pro-rata basis and subsequently on a first-come, first-served basis. This transparent approach is designed to incentivize participation and strengthen ShafDB’s capital adequacy.
BADEA’s President, H.E. Abdullah KH ALMUSAIBEEH, affirmed the importance of this cooperation, stating: “We see this capital program as a strategic milestone in Shelter Afrique Development Bank’s evolution. BADEA is proud to back this initiative and we remain committed to our shared mission of enabling access to decent housing and inclusive urban development across Africa.”
The push to enhance equity capital follows ShafDB’s formal transformation into a Development Bank, a change endorsed during the Extraordinary General Meeting (EGM) held in Algiers, Algeria in October 2023. During the subsequent Annual General Meeting in June 2024 in Kigali, Rwanda, shareholders approved the capital expansion program, with the board greenlighting over USD 200 million in additional capital in December 2024.
“Expanding the capital base will enable the Bank to scale up financing along the housing value chain, access more competitive funding from international and African capital markets, and reinforce its role in addressing the housing deficit across its 44 member states,” Mr. Hann added.
The program is expected to significantly improve ShafDB’s financial leverage over the medium term, support the attainment of investment-grade credit ratings, attract new institutional investors, and allow for expanded lending and technical assistance services throughout its membership base.
