Posted By: Collins Nweze
United Bank for Africa Plc (UBA) has raised $500 million from international investors through Eurobond.
The Tier-1 lender said investors in the bond came from United Kingdom, Europe, Asia, the Middle East, United States and other parts of the world.
The dollar-denominated bond, which was first of such offer by the bank, was 240 per cent oversubscribed.
The significant investor demand, analysts said reflected the strong global investor appetite for the bank’s credit and support for the group’s pan-African financial services strategy.
UBA Plc, which is a leading pan-African financial institution, offers banking services to more than 14 million customers, across over 1,000 business offices and customer touch points in 19 African countries.
The $500 million Eurobond is a five-year senior unsecured benchmark bond (144A/Reg S) listed on the Irish Stock Exchange.
The bank said the fund realised from the offering will further support the group’s strategic vision, as it continues to grow its franchise across the continent and client segments.
The bond, which is rated by both Fitch (B, stable outlook) and S&P (B, stable outlook), matures in June 2022 and was issued with a coupon rate of 7.75 per cent, priced at an effective yield of 7.875 per cent.
The Group Managing Director/CEO of UBA Plc, Kennedy Uzoka, said the acceptance of the offering shows strong confidence global investors have in the bank.
“This successful dollar-denominated offering further illustrates global investor confidence in the strong fundamentals of our group. The $500 million bond will complement our stable funding base and support the growth of our balance sheet and the overall business. More importantly, this medium-term funding will further enhance our strength in financing profitable and impactful projects on the African continent,” Uzoka said.
Also speaking on the Eurobond, the UBA Group Chief Finance Officer, Ugo Nwaghodoh, described the offering as timely and will help the group achieve its growth objectives:
“UBA’s debut global offering is another milestone for us. It is timely in the group’s growth phase and aligns with our strategic plan to profitably grow the balance sheet, as we maintain our prudent risk management and benchmark asset quality ratios,” the bank’s finance chief said.