Ecobank sells first Eurobonds in 18 months

Ecobank Transnational Incorporated has sold $450 of Eurobonds, the first debt sale from a lender with shares listed on the Nigerian Stock Exchange in 18 months.

Bloomberg reported that the bank sold the Eurobonds on Thursday at yields that ranked among the highest from emerging markets this year.

Renaissance Capital said in a statement that the bank issued five-year senior unsecured notes priced at 9.75 per cent, adding that the funding would help the lender to meet its general corporate obligations, including the refinancing of a portion of debt it owed banks.

The Director, RenCap, Samuel Sule, was quoted as saying that the transaction lured strong demand from development banks and financial institutions.

The arrangers of the transaction are Renaissance Capital, Deutsche Bank AG, Standard Bank Group Limited and Standard Chartered Plc, according to Bloomberg.

It said the yields were about the juiciest since Ecuador sold $1bn of 10-year sovereign debt at 10.75 per cent in January, adding that yields on the securities had dropped to nine per cent as sentiment towards emerging markets improved and the government secured a $4.2bn loan package from the International Monetary Fund.

Ecobank raised $200m in loans last year, which are due for repayment in November.

According to Bloomberg, many lenders in the country are looking to raise funding to finance their operations or increase capital reserves after the 2016 recession triggered a surge in non-performing loans and stricter accounting rules increased impairments.

No Nigerian-listed bank had sold Eurobonds since October 2017, when Fidelity Bank Plc issued $400m of five-year securities at 10.75 per cent. The price on the securities has since risen, sending the yield down to about 8.8 per cent.

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