GT Bank issues $500 million eurobond
Guaranty Trust Bank’s recently issued us$500 million eurobond continued to generate positive reviews in the international financial market.
Apart from its landmark achievement of being the first sub-saharan Africa financial sector benchmark eurobond (outside of south Africa), GT Bank is already trading strongly with the market pricing the instrument at $101.13 in the first full week of trading.
The 7.5 per cent five-year deal, priced at $98.981 is GT Bank’s second visit to the international bond market following
a remarkable $350 million Regulations eurobond issue in January 2007 and a $750 million Global Depository Receipts (GDR) Offer. The listing of the GDRs on the London stock exchange made GT Bank the first Nigerian company and African bank to do so. In December 2009, GT Bank successfully completed the first tranche of its $200 million corporate bond targeted at increasing the depths of its operations in West Africa and europe.
The GT Bank Bond, which has J.P Morgan and Morgan stanley as joint book runners, garnered strong investor response, was oversubscribed and placed with over 50 accounts with total allocations represented as follows: us accounts for 37 per cent; u.K 31percent; Africa 16 per cent; europe 13 per cent; and others 4 per cent.
A further breakdown shows that asset managers received 56 per cent, Banks
21 per cent, Hedge funds 12 per cent and other 9 per cent. This allocation shows a balanced international distribution of the eurobond at a pricing consistent with the Bank’s peers in other emerging markets.
The us $500 million eurobond issue has set another history of the Nigerian financial industry as it is the first benchmark size, non-sovereign offering out of Nigeria.
The proceeds from the offer according to the source will be used partly to refinance GT Bank’s us$350 million eurobond which matures in January 2012 and partly for general corporate purposes.