Nigeria: Afreximbank cordinates Euro 500 million social bond issuance

The African Export- Import Bank (Afreximbank) has revealed its successful role as Joint Global Coordinator for the first-ever Euro 500 million RegS-only senior unsecured social bond issued by the Arab Bank for Economic Development in Africa (BADEA). This issuance took place under BADEA’s newly-established Euro Medium Term Note (EMTN) program, which is now listed on the London Stock Exchange.

BADEA, established in 1974 by 18 member countries of the League of Arab States (LAS), serves as a development finance institution. Its primary mission is to offer focused developmental financing to 44 non-Arab Sub-Saharan African countries. As of June 2023, BADEA boasts total assets amounting to USD 5.7 billion.

The bond issuance was 3.0x oversubscribed off peak orderbook EUR 1.5B and supported by over 50 high-quality institutional investors including central banks, DFIs, fund managers and commercial banks from Africa, Middle East, Europe, UK and US offshore accounts. The 3-year bond was priced at 100bps over EUR midswap rate to yield 3.806% (annual fixed coupon 3.750%) well inside initial price thoughts of 120-125bp respectively.

Professor Benedict Oramah, President and Chairman of the Board of Directors of Afreximbank, commented on the transaction:

“We are delighted to support our sister organization BADEA’s market foray as the first thematic bond as well as first Investment Grade-rated DFI bond to be led by Afreximbank reaffirming our drive to deepen capital market access for African issuers under all market conditions.”

Dr. Sidi Ould-Tah, President of BADEA, also remarked on the transaction: “We are pleased with Afreximbank’s strategic contribution in placing our maiden bond with high-quality anchor investors in a manner that enables BADEA to channel greater Arab African development funding towards sectors of highest social multiplier impact.”

Afreximbank, leveraging its Advisory and Capital Markets (ACMA) department, played a pivotal role as Joint Global Coordinator in BADEA’s bond issuance. Collaborating with international banking partners serving as Joint Global Coordinators and Joint Lead Managers, Afreximbank demonstrated its commitment to facilitating strategic financial initiatives.