The Bank of Industry (BOI) has raised N274.18bn through its first domestic naira-denominated bond, surpassing its original N250bn target and setting a new benchmark for Development Finance Institutions in Nigeria.
The five-year fixed-rate bond, which matures in 2031, is the largest debt capital markets issuance by a Development Finance Institution in the country, based on publicly available market data.
Strong investor demand allowed BOI to increase the size of the offering by N24.18bn, with participation coming from a wide range of institutional investors. Pension fund administrators, banks, insurance companies, asset managers, development finance institutions and other institutional investors subscribed to the issue, while Rand Merchant Bank Nigeria served as the Joint Issuing House for the transaction.
The successful fundraising is important not only for BOI but also for Nigeria’s domestic financial market, demonstrating the ability of local investors to support sizeable funding requirements over extended periods.
Chidi Iwuchukwu, Executive Director and Head of Investment Banking, Broader Africa, at RMB Nigeria, said the transaction showed that Nigeria’s capital markets could mobilise substantial resources for institutions seeking to finance economic activity.
He also highlighted BOI’s contribution to industrialisation, enterprise growth and job creation.
“This transaction demonstrates the ability of Nigeria’s capital markets to mobilise long-term capital at scale,” Iwuchukwu said in a statement on Thursday.
“BOI plays an important role in advancing industrialisation, enterprise growth, and job creation. We are pleased to have partnered with the Bank on this issuance and remain focused on delivering financing solutions that support sustainable economic growth in Nigeria and across the broader African continent.”
The bond is the latest development in a longstanding relationship between RMB and BOI. RMB previously acted as financial adviser to the bank on its inaugural Eurobond issuance and also supported the establishment of BOI’s domestic bond programme.
Laju Atake, Head of Debt Capital Markets at RMB Nigeria, said the transaction reflected the continued evolution of Nigeria’s capital markets and the importance of efficient access to funding for major institutions.
“Supporting inaugural issuers and significant capital markets transactions is a core strength of RMB’s debt capital markets franchise,” Atake said.
He disclosed that RMB had advised five distinct issuers on their debut debt capital markets transactions in Nigeria over the preceding nine months.
According to RMB, the level of demand for BOI’s offering also highlighted the liquidity within Nigeria’s domestic capital markets and the ability of local investors to participate in large-scale financing transactions.
The execution involved the Securities and Exchange Commission, the Central Bank of Nigeria, professional advisers, transaction parties, investors and other market participants.
RMB expressed its appreciation to all those involved in completing the transaction and congratulated BOI’s Board, Management and staff on the outcome. The bank also thanked BOI for its continued trust.
The latest issuance further extends RMB’s work with BOI across both domestic and international capital markets, while giving the Bank of Industry another funding avenue for its development-focused activities in Nigeria and the African continent.
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