Fidelity Bank issues N41.21bn bond

Fidelity Bank Plc has issued 10-year N41.21bn in fixed rate unsecured subordinated bond at 8.5 per cent coupon rate due in 2031.

In a statement by the bank, the bond issuance is the largest Tier II local bonds in Nigeria’.

According to the bank, “The bond issuance, which was fully subscribed, given that total investor interest and commitments in the bonds were N56.6bn, adds to the impressive portfolio of landmark transactions structured by the bank, and underscores its capacity to successfully execute debt capital market transactions.

‘The transaction is a landmark achievement in the Nigerian domestic debt market for being the largest corporate bonds ever issued by a Nigerian Bank including the deposit money banks and merchant banks etc.”

The bank in December 2020 had announced plans to issue fixed income securities with 10-year tenor to support the growth and development of Small and Medium Enterprises, retail business as well as its technology infrastructure.

The bank conducted the debt issuance under its registered N100bn bond issuance programme.

It stated that the bonds were unsecured and subordinated, which would qualify as Tier II Capital in line with the Central Bank of Nigeria guidance notes on regulatory capital for commercial banks in Nigeria.

The bank’s CEO, Nneka Onyeali-Ikpe, noted that proceeds from the transaction would be utilised to support growth in the issuer’s risk assets in SME and retail business as well as investments in technology and retail infrastructure. This was in line with the bank’s Tier I aspirations.

According to her, its business fundamentals had remained strong despite the challenging economic environment occasioned by the coronavirus pandemic and the attendant recession.

“The successful bond issuance highlights the confidence in the Fidelity brand, as well as our capability to expand our funding sources, and deliver innovative financial services to our esteemed customers,” she added.

The bank stated that the issue was assigned a rating of A- by Agusto, and A by Datapro and would be listed on both the Nigerian Stock Exchange and FMDQ Securities Exchange Limited.

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