Africa Finance Corporation (AFC), the continent’s premier infrastructure solutions provider, has successfully led Nigeria’s inaugural domestic dollar bond issuance, raising over $900 million. This groundbreaking bond, issued by the Federal Government of Nigeria (FGN), marks a key milestone in the country's financial sector.
As Global Coordinator, AFC played a critical role in launching this first-of-its-kind bond for Nigeria’s capital market. The five-year bond, issued at par with an annual coupon rate of 9.75%, saw overwhelming demand, closing at 180% oversubscription. This highlights strong investor confidence in Nigeria's economic prospects and the strength of AFC’s leadership in the capital markets.
The bond attracted a diverse investor base, including Nigerians at home and abroad, as well as institutional investors. It will be traded on the Nigerian Exchange Limited (NGX) and FMDQ Securities Exchange Limited (FMDQ Exchange).
This successful issuance underscores AFC’s commitment to bolstering Nigeria's capital markets, fostering financial inclusion, and diversifying funding sources. The bond is the first under Nigeria's Domestic US Dollar Bond Programme, with proceeds earmarked for critical economic sectors, approved by the President and subject to National Assembly appropriation.
"This inaugural domestic US dollar bond issuance is a significant achievement for Nigeria and marks a new chapter in the development of the country's capital markets," said Banji Fehintola, Executive Director and Head of Financial Services, Africa Finance Corporation. "We are honoured to have played a leading role in this landmark transaction as the Global Coordinator, which aligns with AFC's mission to develop domestic capital markets in Africa by providing innovative financing solutions that meet the continent's unique needs and also leveraging our deep capital market expertise to serve and deliver value to our clients. This successful issuance not only showcases Nigeria's economic potential but also reinforces the benefits of African nations looking inward to tap the deep pool of domestic capital on the continent and taking the lead in financing their own development."
AFC has a solid track record in capital markets with a well-established diverse investor engagement program that included issuance of a US$1.16 Billion global syndicated loan earlier this year. The Corporation was recently bestowed with "The Most Innovative Bond" award at the EMEA Finance Achievement Awards for its pioneering JPY 75 billion Samurai Bond Guarantee to the Arab Republic of Egypt and the “Best Supranational Syndicated Loan” award for securing a US$625 million syndicated loan last year, welcoming new lenders from the Middle East and Asia.
Alongside AFC’s role as Global Coordinator for the domestic bond issuance, United Capital Plc acted as Lead Issuing House/Coordinator; Meristem Capital Limited, Stanbic IBTC Capital Limited and Vetiva Advisory Services Limited acted as Issuing Houses; Constant Capital Markets & Securities Limited and Iron Global Markets Limited acted as Financial Advisers; Olaniwun Ajayi LP and G. Elias acted as Solicitors; and Greenwich Trustees Limited acted as Trustee.
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