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Renaissance Capital leads successful $500,000,000 additional tier 1 Eurobond offering for Access Bank

The $500,000,000 additional tier 1 Eurobond offering for Access Bank sets a strong benchmark for other banks from Nigeria

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Renaissance Capital Access Bank

On 30 September 2021, Renaissance Capital, a leading emerging and frontier markets investment bank, in the capacity of Joint Lead Manager and Bookrunner, successfully completed Access Bank plc’s USD500mn Additional Tier 1 Eurobond offering.

This Basel III-based USD-denominated PerpNC5.25 Regulation S/144A Additional Tier 1 bond was priced at 9.125%, which implies an optimal premium to Access Bank’s earlier launched senior bond issue and is in line with comparable AT1 issues from the broader CEEMEA region.

The bond issue was placed as part of a broad USD1.5bn funding programme.

The offering enjoyed strong investor demand, highlighting the positive perception of the Bank’s credit story and the management’s clear strategy.

Regulatory approvals allowed Access Bank to comfortably tap markets for a benchmark USD500mn AT1 transaction – the first from a Nigerian bank.

Speaking on the development, Samuel Sule, acting CEO, Nigeria, Renaissance Capital, said: “The success of this transaction highlights Access Bank’s solid credit story and sets a strong benchmark for Additional Tier 1 issues from Nigerian banks. The transaction follows the release of new regulatory capital guidelines from the Central Bank of Nigeria, and Renaissance Capital is pleased to have been a part of this concerted effort to deepen the Nigerian capital markets and support economic growth.”

Access Bank plc is a leading full-service Nigerian commercial bank with operations in 11 African countries, rated B2 (negative) and B (stable) by Moody’s and Fitch, respectively.

Access Bank ranks number one in Nigeria by assets, deposits, customers, revenue and RoE as at H1 2021.

The acceptance of the bank’s offer is expected to spur other Nigerian lenders to raise dollar-denominated debt, as well as pave the way for the federal government’s proposed $1 billion Eurobond issue expected to be floated before the end of the year.

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In addition, it is expected to result in improved inflow of foreign exchange into the economy, thereby boosting economic growth.

The Access Bank issue has a maturity date of October 2021 and a coupon rate of 10.5 per cent. The Eurobond issue made the bank the first Nigerian lender to raise a bond from the international market since 2014, despite the country’s macroeconomic headwinds.

The bank said the successful outcome of the bond demonstrated its strength, resilience and international endorsement.

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