The Advisory & Capital Markets (ACMA) Division of African Export-Import Bank (Afreximbank) has acted as Joint Global Coordinator and Active Bookrunner to Nigeria’s Bank of Industry (BOI) on its EUR 700 million 144A/RegS 5-year Senior Eurobond Issuance.
The bonds are irrevocably and unconditionally guaranteed by the Federal Government of Nigeria and marks BOI’s debut into international capital markets in order to diversify its funding base.
BOI is rated B2 (Stable) by Moody’s and B (Stable) by Fitch. The bond matures on the 16th of February 2027 and was issued with a yield and coupon of 7.500% with interest payable annually in arrears.
Nigeria’s Bank of Industry is the oldest and largest Development Finance Institution (DFI) in Nigeria and is owned by the Ministry of Finance and Central Bank of Nigeria.
BOI raised EUR 700 million against an orderbook that was 1.5 times oversubscribed, the transaction witnessed significant demand from high-quality international investors from Europe, UK, USA, Middle East and Africa.
BOI will use bond proceeds to fund general corporate purposes, thus expanding its developmental impact to support the Nigerian real sectors including SMEs.
Afreximbank acted as Joint Global Coordinator and Active Bookrunner supporting BOI throughout the inaugural issuance process.
According to a statement released by the Bank, this is the second time Afreximbank has acted as a global coordinator in the debt capital markets in recent months, reaffirming its capability to facilitate access of African clients to new and diverse funding sources.
Afreximbank pleased with good start
Commenting on the transaction, Afreximbank’s President, Prof. Benedict Oramah, noted that Afreximbank is pleased to start the year on a strong note supporting Nigeria’s oldest and largest DFI on this landmark transaction.
“The achievement on this issuance demonstrates the confidence of international investors in Nigeria and Africa as a whole. This latest transaction takes us to USD 2.4 billion of financing advised and arranged by Afreximbank in the international capital markets over the last one year alone, thus demonstrating Afreximbank’s commitment to supporting economic growth in its member countries by capitalizing on global markets”.
Prof. Benedict Oramah
On his part, Olukayode Pitan, Managing Director and Chief Executive Officer at BOI, said that he was pleased to have a sister African institution like Afreximbank play a key role in this landmark transaction. He added that the issuance is aligned with Nigeria’s Agenda 2050 and National Development Plan 2025.
“BOI has been in operation for over 60 years with a significant understanding of the Nigerian banking sector. Our developmental mandate is guided by the National Development Plan 2025 and primary drivers of our strategy is to provide lower interest rates, job/value creation, women & youth empowerment, creative industry and sustainability, to name a few”.
Olukayode Pitan
Role of Afreximbank in AfCFTA
The African Export-Import Bank, a Pan-African multilateral financial institution, is mandated to finance and promote intra-and extra-African trade.
Afreximbank deploys innovative structures to deliver financing solutions that support the transformation of the structure of Africa’s trade, accelerating industrialization and intra-regional trade, thereby boosting economic expansion in Africa.
A stalwart supporter of the African Continental Free Trade Agreement (AfCFTA), Afreximbank has launched the operations of a Pan-African Payment and Settlement System (PAPSS) that was adopted by the African Union (AU) as the payment and settlement platform to underpin the implementation of the AfCFTA.
At the end of 2020, the Bank’s total assets and guarantees stood at US$21.5 billion, and its shareholder funds amounted to US$3.4 billion. Headquartered in Cairo, Afreximbank disbursed more than US$42 billion between 2016 and 2020. The Bank has ratings assigned by GCR (international scale) (A-), Moody’s (Baa1) and Fitch (BBB-).
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