Access Bank to launch $1 billion Eurobond programme

27 Sep 2016
Financial Nigeria


Access Bank has kicked-off an investor roadshow to raise $1 billion under its Global Medium Term Note Programme.

Herbert Wigwe, Group Managing Director/CEO, Access Bank Plc

Access Bank, a leading Nigerian bank, has kicked-off an investor roadshow today as it plans to raise $1 billion under its Global Medium Term Note Programme.

According to a bond prospectus released on the Irish Stock Exchange, Access Bank said its management will meet with prospective foreign investors in the United States and Europe to generate interest in its bond issue. The initial amount to be raised in this series has not been announced.

“It will be for working capital, for lending to investment-grade names including Nigerian companies seeking to expand their exports,” Herbert Wigwe, Access Bank’s Group Managing Director/CEO told Bloomberg on Monday.

In April this year, Access Bank obtained shareholder approval to raise N100 billion from a public offering or private placement to fund branch expansion and lending. The bank currently has two outstanding Eurobonds – a $350 million bond due in 2017 and a $400 million bond due in 2021.

Access Bank’s decision to issue a new bond instead of an outright redemption of its maturing $350 million bond shows the bank’s preference to refinance the debt despite current high yield, CardinalStone Partners, a Lagos-based investment advisory firm, said in a note to investors.

“We note however that Access Bank has sufficient dollar liquidity from its $800 million in off balance sheet swaps to redeem the debt but rather prefers refinancing to further strengthen its FX balance sheet,” the investment firm said. “Though refinancing at current yields will definitely push up its interest expense, we believe the potential gains will outweigh the cost.”

In its 2016 half-year report, Access Bank said after-tax profit rose 26 percent year-on-year to N39.5 billion while revenues rose by 3 percent to N174 billion. Total assets reached N3.27 trillion in the review period.

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