IFC Launches First International Bond in Zambia’s Domestic Capital Markets - IFC, a member of the World Bank Group, has issued a 150 million kwacha bond—equivalent to approximately $28.4 million—to support domestic capital markets and increase access to local-currency finance in Zambia. The issue, dubbed “Zambezi” bond, is IFC’s first kwacha-denominated bond. It is also the first placement by a non-resident issuer in Zambia’s domestic capital markets, and the first issuance under the IFC Pan-Africa Domestic Medium Term Note Programme. “Vibrant domestic capital markets create access to long-term, local-currency finance for the private sector—the key engine of job creation in emerging markets,” said Jingdong Hua, IFC Vice President and Treasurer. “The IFC Zambezi bond supports our efforts to deepen domestic capital markets in Africa, so they can sustain a thriving private sector in the region.” In July 2013, IFC received approval for a local-currency bond program in Zambia. Under the program IFC can issue bonds of up to 2.5 billion Zambian kwachas (approximately $460 million). Standard Bank and Stockbrokers Zambia Ltd. are co-lead arrangers for the programme. The four-year bond was designed to appeal to a broad range of domestic and international investors looking to diversify their portfolios. The order book was over 700 million kwacha, equivalent to an oversubscription of 4.8 times. Investors include Zambian pension funds, international and domestic asset managers, insurance companies, and banks. The bond was issued at par and priced with a yield of 15 percent p.a. IFC Director for Eastern and Southern Africa Oumar Seydi said: “The IFC Zambezi bond supports the efforts of the government and authorities to deepen domestic capital markets in Zambia. Such markets are an important source of local-currency funding, in line with IFC’s strategy for broader private sector development through micro, small and medium enterprises and other essential economic sectors.” IFC
Posted on: Wed, 25 Sep 2013 07:10:03 +0000
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