Ecobank Nigeria Issues Africa’s First Biggest Corporate Eurobond Offerings for US$300m 7.125% 5-Year

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    On the 10th of February 2021, Ecobank Nigeria successfully locked into the international debt market with a US$300m 5-year 7.125% Reg S / 144A senior unsecured bond issue.

    The fixed-rate, US dollar-denominated bond, with a tenor of 5 years, carries a coupon rate of 7.125 percent and will be listed on the London Stock Exchange.

    The lead runner of the Offers book was Renaissance Capital which also acted as the joint lead manager of Offer.

    The US$300m issue moves the needle for international bond raise by frontier economy corporations such as Ecobank Nigeria. The key features of the offer include:
    Being the first senior Eurobond issue for Ecobank Nigeria, hence representing a sophomore international bond market Offer
    The offer is the first African bank Eurobond issue in 2021
    The debt raise represents the lowest (outstanding) Nigerian bank Eurobond coupon being oversubscribed by 400% on the order book

    The new Eurobond offer followed a broad marketing campaign with both non-deal and deal roadshows, that involved consultations with over 90 institutional investors.

    The fixed-rate, US dollar-denominated bond, with a tenor of 5 years, carries a coupon rate of 7.125 percent 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 percent and finally tightened to close at 7.125 percent on the back of robust demand.

    The strength and depth of the book demonstrated global investors’ strong appetite for the Ecobank franchise in Nigeria.

    This transaction is the first non-sovereign bond from Africa in 2021 and is a 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 Book runners.

    Commenting on the issuance, 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.” 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.”

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