FCMB lists N20.69 billion bond on FMDQ platform

By Cynthia Ezekwe

FMDQ Securities Exchange Limited has admitted FCMB Group Plc N20.69 billion Series 1 fixed rate resettable NC5.25 additional tier 1 subordinated bond under its N300.00 billion debt issuance programme.

FMDQ, in a statement, disclosed that the lead sponsor of  FCMB Group bond is Chapel Hill Denham Advisory Limited, while the co-sponsor is FCMB Capital Markets Limited noting that both registration members are listings of FMDQ Exchange.

According to FMDQ, the  bond will be used by the issuer to purchase intercompany notes to be issued by First City Monument Bank Limited, for purposes of the Bank financing incremental term lending in focus sectors and shoring up the Bank’s regulatory capital base.

Ladi Balogun,chief executive, of FCMB Group PLC, while commenting on the listing expressed his  delight to the company’s  investors, advisers, and regulators, particularly the Securities and Exchange Commission (SEC) , and the Central Bank of Nigeria (CBN), for their support on the maiden issuance under the  N300.00 billion Programme.

“The innovative structure of a perpetual, income-yielding bond that qualifies as Tier 1 capital – a first of its kind in the domestic capital markets,achieves three objectives for investors: it is non-dilutive for existing shareholders; creates capacity for improved earnings and dividends per share; and provides an attractive income stream to investors,’’ Balogun said.

He added that the company is also pleased to support its largest banking subsidiary towards the attainment of its growth, risk management, and strategic objectives with the investment.

Also, the lead sponsor of the bond on the exchange, Chapel Hill Denham Advisory Limited, through Lanre Buluro, its managing director, said: “Chapel Hill Denham Advisory Limited is pleased to have acted as Financial Adviser to FCMB Group Plc on the issuance of the N20.69 billion Perpetual Fixed Rate Resettable NC5.25 Additional Tier 1 Subordinated Bond.’’

Buluro added that the novel transaction structure provides a unique opportunity for banks and other domestic capital market participants to access financing from the investing public with more favourable terms and conditions than a conventional bond issuance while meeting investors’ return requirements.