Kennedy Uzoka, Group Managing Director and Chief Executive of United Bank for Africa Plc Plc says the recently issued US$500m debut Eurobond is part of efforts by the management to complement the group’s stable funding base, besides supporting balance sheet growth to effectively support its footprint across the African continent.
Proceeds of the bond rated by both Fitch (B, stable outlook) and S&P (B, stable outlook), which matures in June 2022 and issued with a coupon rate of 7.75%, priced at an effective yield of 7.875%, he said would support the group’s overall business.
The debut Eurobond, a five-year senior unsecured benchmark instrument (144!/Reg S) Global Offering is a five-year senior unsecured benchmark bond, was 240% over-subscribed, reflecting significant investor demand and strong global investor appetite for UBA’s credit and support for the Group’s pan-African financial services strategy.
The bond listed on the Irish Stock Exchange is expected to further support the Group’s strategic vision, as it continues to grow its franchise across the continent and client segments.
A statement by the group noted that interest in the bond was global, attracting investors from the United Kingdom, Europe, Asia, the Middle East and the US.
It quoted Uzoka as saying the success of the “offering further illustrates global investor confidence in the strong fundamentals of our group. More importantly, this medium-term funding will further enhance our strength in financing profitable, impactful projects on the African continent.” Also, UBA’s Group Chief Finance Officer, Ugo Nwaghodoh said the “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.”
Pricing of the bond is seen by the global investor community as the best possible pricing for a debut issue from a financial institution of Nigerian origin in current markets. The pricing was at par to the recent bond issue by the Federal Republic of Nigeria, which issued US$1 billion in February 2017.