African Bank, a wholly-owned subsidiary of African Bank Investment Limited (ABIL), has successfully raised R2 billion ($216 million) in senior unsecured funding in the domestic market from the combination of an existing bond issue and through a new issue of bonds under its Domestic Medium Term Note (‘DMTN’) programme.
R1.2 billion ($130 million) was tapped from the existing R800 million ($87 million) inflation linked note, which was issued on 19th February 2013 with a coupon of the South African consumer inflation rate (‘CPI’) with an additional 3.2 percent. The R1.2 billion bond is set to mature in February 2018.
A new three year floating rate note to the value of R800 million was also issued. Set to mature in March 2016, the bond bears a coupon of 3 month JIBAR plus a margin of 199 bps per annum, which was also tighter than the last similar bond issued in October 2012.
Commenting, Gavin Jones, African Bank Executive Funding and Liability Management, said: “We appreciate that South African debt funders have once again demonstrated their confidence and support for African Bank’s credit as both of these issues were oversubscribed by 1.3 times. The pricing received was also tighter than our similar bonds issued last year and well within price guidance.”
