By Dipo Olowookere
The sale of N15 billion worth of commercial paper by the Rand Merchant Bank (RMB) Nigeria Limited will close today, Wednesday, April 6, 2022.
The financial institution is selling the notes to investors as a result of the need to get funds for its short-term working capital requirements and for general corporate purposes.
The exercise started on Friday, April 1, 2022, with the paper offered in two tenors of 182 days and 270 days, according to details of the exercise, which has FCMB Capital Markets Limited as the dealer.
The commercial paper sale, which is under the N80 billion programme of the issuer, is being sold to investors in series 1 and 2.
The instrument has a minimum subscription of N5 million and N1 million thereafter and is subject to withholding tax and Value-Added Tax (VAT) of 7.5 per cent, in line with the directive of the federal government.
Business Post reports that the 182-day maturity comes with a discount rate of 7.4617 per cent and an implied yield of 7.7500 per cent, while the 270-day tenor comes with a discount rate of 7.9972 per cent and an implied yield of 8.5000 per cent.
RMB Nigeria was authorised by the Central Bank of Nigeria (CBN) to carry out merchant banking operations as well as financial advisory, corporate banking, and trading.
The lender is a subsidiary of FirstRand Group, a financial services group publicly listed on the Johannesburg Stock Exchange and the Namibian Stock Exchange.
Since it commenced operations in Nigeria about a decade ago, its Non-Performing Loans (NPL) ratio has been 0.00 per cent, with Capital Adequacy Ratio (CAR) and Liquidity Ratio at 43.10 per cent and 100.30 per cent respectively in the 2020 fiscal year, far above the regulatory requirements of 10 per cent and 30 per cent respectively.
Adedapo Adesanya