Bank of Industry (BOI) has recorded a successful debut in Nigeria’s domestic debt capital market after its inaugural N250 billion Series 1 Fixed Rate Bond attracted subscriptions above the amount offered.
According to a news release on the bank’s website on August 17, the bond was issued through BOI Financing SPV Plc under the bank’s $1 billion Multi-Currency Instruments Programme.
The bank said the offer attracted strong interest from institutional investors, including pension fund administrators, commercial banks, development finance institutions and corporates.
The transaction also received anchor investments from the Nigeria Sovereign Investment Authority and the International Finance Corporation.
BOI said proceeds from the bond would be used to expand its long-term financing capacity for businesses in priority sectors, with the aim of supporting industrial growth, job creation, local value addition and economic diversification.
BOI Managing Director and Chief Executive Officer, Olasupo Olusi, said the strong response showed that Nigeria’s domestic capital market had the capacity to mobilise long-term funds for development financing.
He attributed the investor response partly to policy support from President Bola Tinubu, including incentives approved to encourage investment in the bond.
Olusi also said a N100 billion fund approved for BOI by the President would support the pricing of the bond and help reduce borrowing costs for manufacturers and other beneficiaries of BOI financing.
The five-year bond, which opened on August 5 and closed on August 11, was priced within a yield range of 17.35 per cent to 17.50 per cent. It offers semi-annual coupon payments and a two-year principal moratorium before amortising repayments begin.
BOI said the final subscription and allotment figures would be announced after obtaining approval from the Securities and Exchange Commission.
The bond is expected to be listed on the FMDQ Securities Exchange after completion of the issuance process.
