IFC offers Nigeria’s domestic capital market 12bn

TheInternational Finance Corporation (IFC), a member of the World Bank Group yesterday offered a Nigerian local currency bond totaling 12 billion naira to support domestic capital markets and increase access to local-currency finance.The money, which is approximately $75 million and called “Naija” bond, was the IFC’’s first naira-denominated bond and the first placement by a non-resident issuer in Nigeria’s domestic capital markets. While speaking, the IFC Vice President and Treasurer, Jingdong Hua said vibrant domestic capital markets would create access to long-term and local-currency finance for the private sector, adding that “the IFC Naija bond supports our efforts to deepen domestic capital markets in Africa, so they can sustain a thriving private sector in the region.”

”The five-year bond was designed to appeal to a broad range of domestic investors looking to diversify their portfolios. Initially planned as a $50 million issue, the bond was increased due to strong investor demand. All investors in the bond are Nigerian pension funds, asset managers, and banks. The bond is priced at par with a yield of 10.2%.”It is believed that the proceeds from the bond will be used to support IFC’s private sector development program.Also speaking, the IFC Country Manager for Nigeria, Solomon Adegbie-Quaynor said “the IFC Naija bond supports the efforts of the government and authorities to deepen domestic capital markets and grow the corporate bond market in Nigeria. A well-developed corporate bond market in turn can provide affordable, long-term naira funding to meet the financing needs for critical sectors such as power.””IFC’s committed portfolio in Nigeria stands at $1.1 billion, the largest country portfolio in Africa and the eighth-largest globally.”