The fixed-rate, US dollar-denominated bond, with a tenor of
5 years, carries a coupon rate of 7.125% and will be listed on the London Stock
Exchange.
It is accompanied by an Issuer Rating of B- from Fitch
Rating Agency and S & P. The coupon / yield represents the lowest ever
coupon / yield achieved by a Nigerian financial institution for a benchmark
bond transaction.
At the peak of marketing the transaction, the issue was over
3 times oversubscribed, with significant interest from international investors.
The transaction opened with Initial Price Thoughts (‘IPT’s’)
of 7.75% and finally tightened to close at 7.125% on the back of robust demand.
The strength and depth of the book demonstrated global
investors’ strong appetite for the Ecobank franchise in Nigeria, a testament to
the strength of the Ecobank Group.
This transaction is the first non-sovereign bond from Africa
in 2021 and is milestone capital raise for the banking sector in Nigeria,
giving Ecobank access to global debt capital markets, and more favorable credit
terms, commensurate with its strong financial position and robust capital
structure. For international investors, it represented an attractive option to
gain exposure to Nigeria.
This transaction followed a series of virtual global
investor calls, with a number of blue-chip local, regional and international
financial institutions, led by Citi, Mashreq, Renaissance Capital and Standard
Chartered Bank as Joint Lead Managers and Bookrunners.
Commenting on the issuance, Mr. Patrick Akinwuntan, Managing
Director of Ecobank Nigeria, said: “Despite the challenging global environment
owing to the COVID-19 pandemic, and on the back of a successful NGN 50bn Tier 2
issuance in December 2020, ENG was able to successfully issue and price
Nigeria’s first 2021 senior unsecured 5 year bond transaction.
“Ecobank Nigeria, through this issuance, is being proactive
in optimizing its capital structure as it continues to drive its medium term
growth strategy of establishing itself as a leading facilitator of pan-Africa
and international trade and payments.”
Mr. Akinwuntan continued, “I would like to extend my
appreciation to our regulators, the Central Bank of Nigeria, for their timely
support and continuous guidance, in granting necessary regulatory approvals.”
He further added: “We believe that our capital raising
activities are key steps forward towards strengthening ENG beyond the
regulatory ratios in addition to diversifying ENG’s medium-term financing
sources. ENG is poised for continued growth in the Nigerian financial services
industry.”