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Africa Finance Corporation Issues $500m

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Africa Finance Corporation (AFC), a leading Pan-African multilateral development finance institution and project developer, has issued a US$500 million 7 year Eurobond.

The senior, unsecured Eurobond which carries a coupon of 3.875% was priced to yield 4.000% and matures in April 2024.

The Eurobond received strong global interest, with an order book of US$2.4 billion, representing about 5 times over-subscription from 231 investors across the Middle East, Asia, the United Kingdom, Europe and the United States.

Prior to the launch of the bond, AFC conducted a roadshow in London, Hong Kong, Singapore, the UAE, and the United States.

The bond is AFC’s second benchmark Eurobond issuance under the Corporation’s US$3 billion Global Medium Term Note Programme.

The bond was rated A3 by Moody’s Investor Services which is in line with AFC’s issuer rating. The bond will be listed on the Irish Stock Exchange.

The Eurobond was distributed to investors in Europe (29%), United States (25%), United Kingdom (24%), Asia (18%) and the Middle East (4%).

AFC is only the second African development finance institution to issue a Eurobond with maturity longer than 5 years, reflecting AFC’s strong credit standing and its ability to match-fund medium to long-dated infrastructure investments.

Commenting on the issue, Andrew Alli said: “AFC has been committed for the last ten years to investing in projects that drive sustainable growth and development in Africa. In that time, we have invested over US$4 billion in 28 African countries.

“Key to delivering this are our fund-raising activities around the world, promoting the very real investment opportunities that exist in African infrastructure. The strong interest in this bond reflects investors’ confidence in AFC’s credit, strategy and risk management culture, as well as appetite for exposure to the returns available in African markets.” 

Commenting on the issue, Banji Fehintola, Director & Corporate Treasurer of AFC added: “After a successful debut Eurobond issuance in 2015, AFC has consistently engaged investors through a series of non-deal roadshows and other debt capital market issuances. The tremendous success of our second Eurobond issuance attests to the fact that investors continue to seek exposure to high quality, investment grade credits like AFC. This is indeed a solid endorsement of AFC’s strong business fundamentals, governance, funding strategy and risk management.”

The Eurobond issue follows a solid track record of successful capital market issuances starting with AFC’s debut US$750 million Eurobond issued in April 2015. The 2015 Eurobond was priced to yield 4.595% for a five-year tenor and matures in April 2020.

Last year, AFC issued its debut senior unsecured long three-year Swiss Franc (CHF) denominated bond, raising CHF 100 million, and earlier this year, issued its maiden US$ 150 million three year Sukuk, the highest-rated ever Sukuk issuance from an African institution and the first Sukuk to be issued by an African supranational entity.

On 15th – 16th May 2017, AFC will celebrate its 10th anniversary at AFC Live, Africa’s premier infrastructure summit, which will bring together the top international players in African infrastructure investment for high-level discussions on the industry’s many challenges, and potential solutions.


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E-Financial

Lagos State Appoints MoneyMaster as Payment Partner for “Ounje Eko” Programme

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“Ounje Eko”, the food price discount initiative of the Lagos State Government, has appointed leading payment service bank, MoneyMaster Payment Service Bank Limited (MMPSB), as its collaborator in the bid to ensure ease of payments at the market.

MoneyMaster is one of the Central Bank of Nigeria-licensed Payment Service Banks (PSBs) to promote financial inclusion across Nigeria.

Under the partnership, MMPSB will apply its cutting-edge payment solution to engender easy payment and reconciliation in order to make   the experiences of Lagosians who will be getting their food supplies from the markets pleasurable. Its payment solution is also all-encompassing and ensures real time value to payment destinations.

The mobile bank was appointed as the collection and payment partner for “Ounje Eko” Food Markets programme which is a government initiative serving the five divisions of Lagos State. Consequent on this, MoneyMaster Payment Service Bank will collect payments in 57 LCDAs in the state.

The partnership gives credence to the quality of payment solutions that MoneyMaster is reputed for in its services to its growing business clientele in private and public sectors.

 


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E-Financial

CBN, EFCC Probe Banks, Firms over Alleged Forex Racketeering

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Central Bank of Nigeria (CBN), is investigating irregular foreign exchange transactions and forward contracts valued at approximately $2.4 billion.

CBN, EFCC Probe Banks, Firms over Alleged Forex Racketeering

The  inquiry follows an extensive audit by Deloitte, which scrutinized $7 billion in dollar debts accumulated under the bank’s previous leadership.

In the aftermath of the 294th Monetary Policy Committee meeting in Abuja, Yemi Cardoso, governor of CBN,  disclosed to journalists that the investigation, supported by the Economic and Financial Crimes Commission, among other security bodies, aims to clarify the legitimacy of these FX allocations identified as problematic by the audit.

“It was determined that a number of these transactions did not qualify…they were outright illegal. The law enforcement agencies are now looking into those transactions that as far as we are concerned, are not valid to be paid,” Cardoso detailed, emphasizing the unlawful nature of these forex deals.

The crux of the investigation lies in the audit findings that a significant portion of the scrutinized transactions lacked proper documentation and, in many instances, were deemed outright illegal.

However, the unfolding investigation has raised concerns within the organized private sector, with some entities contemplating legal action against commercial banks for unresolved forex bids.

Despite these tensions, Governor Cardoso reassures that the foreign exchange market remains open and transparent, inviting stakeholders to address their forex needs through the official channels.

Furthermore, Cardoso clarified the distribution of fertilizers to farmers as a one-off measure and not indicative of a shift back to direct interventions by the CBN, underscoring a commitment to strategic, regulatory governance rather than direct market involvement.

 

 

 

 

 

 

 

 


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CBN Urges Banks to Expedite Action on Recapitalisation

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Central Bank of Nigeria (CBN) has directed deposit money banks in the country to expedite action to increase their capital base from the current ₦25bn.

CBN Urges Banks to Expedite Action on Recapitalisation

Olayemi Cardoso, governor of CBN

Olayemi Cardoso, governor of CBN, stated this during the apex bank’s 294th meeting of the Monetary Policy Committee (MPC) on Tuesday in Abuja, when the MPC hiked the interest rate by 22.75% to 24.75%.

The apex bank chief said the MPC examined developments in the banking sector and expressed satisfaction that the industry remained stable. The committee, however, said to guard against risk, commercial banks in the country should accelerate their recapitalisation efforts.

Cardoso said, “The MPC also reviewed developments in the banking system and noted that the industry remains safe, sound, and stable. The committee thus called on the bank to sustain its surveillance and ensure compliance of banks with existing regulatory and macro-potential guidelines.

“The MPC also enjoined the banks to expedite actions on the recapitalisation of banks to strengthen the system against potential risks in an increasingly globalised world.”

 

 

 

 


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