By Dipo Olowookere
A mid-level Nigerian lender, First City Monument Bank (FCMB), has sold bonds worth N26 billion to some high-value investors in the capital market.
The company confirmed the sale of the debt instrument in a regulatory notice filed to the Nigerian Exchange (NGX) Limited on Thursday.
The tier-2 banking institution issued the corporate bonds to subscribers through its parent firm, FCMB Group Plc, which is listed on the stock exchange.
In a notice signed by its company secretary, Mrs Olufunilayo Adedibu, it was disclosed that the additional tier 1 subordinated bonds cleared at a coupon rate of 16.00 per cent.
The paper, which was sold in the second tranche, is under the N300 billion debt issuance programme of the organisation.
The funds raised from the exercise, according to the statement, would be pumped into the bank for the execution of “its long-term strategic objectives.”
It was revealed in the disclosure that offers were received from various investors in the market, particularly from high net-worth individuals (HNIs), trustees, corporates, and other financial institutions (OFIs) like insurance companies and others.
“The net proceeds from the Series 2 Bond will be injected to the group’s banking subsidiary, First City Monument Bank Limited, enabling the group and the bank to execute its long-term strategic objectives,” a part of the statement said.
FCMB noted that the “successful Series 2 bond issuance highlights the group’s commitment to embracing innovation in the Nigerian banking sector and is in line with the Central Bank of Nigeria’s desire for stronger capitalized banks.”
According to the notice yesterday, Chapel Hill Denham Advisory Limited and FCMB Capital Markets Limited acted as the issuing houses to the AT1 instrument.
