The FCMB Group Plc has successfully completed the issuance of N20,686,000,000 Perpetual 16% Fixed Rate Resettable NC5.25 Additional Tier I Capital Subordinated Bonds (AT1) under its N300,000,000,000 Debt Issuance Programme. This issuance marks the first non-sharia local currency AT1 instrument issued in Nigeria, and it is the Group’s first issuance under its N300 billion funding programme in the Nigerian Capital Markets to support its next phase of growth.
The AT1 instrument was issued at a clearing coupon rate of 16.0% per annum. The proceeds from the Series I Bond will be invested in the Group’s Banking Subsidiary – First City Monument Bank Limited (“the Bank”) – to enhance the Bank’s Tier 1 and total capital adequacy ratios. This investment will enable the Group and the Bank to expand its support for the growth and development of the Nigerian economy.
Ladi Balogun, Group Chief Executive of FCMB Group Plc, expressed his gratitude to investors, advisers, and regulators, particularly the Securities and Exchange Commission and the Central Bank of Nigeria, for their support on the maiden issuance in their N300 billion bond programme. He described the innovative structure of the perpetual, income-yielding bond as a first of its kind in the domestic Capital Markets that achieves three objectives for investors: it is non-dilutive for existing shareholders, creates capacity for potentially improved earnings per share and dividends per share, and provides an attractive income stream for investors in this instrument.
Yemisi Edun, Managing Director of FCMB Bank Limited, added that in addition to strengthening the Bank’s capital base to comply with the forthcoming application of Basel III capital requirements, the AT-1 bond would enable the Bank to finance incremental term lending in priority sectors.
In conclusion, FCMB’s successful issuance of its Perpetual 16% Fixed Rate Resettable NC5.25 Additional Tier I Capital Subordinated Bonds marks a significant milestone in the Nigerian Capital Markets, and it is a testament to the confidence of investors in the Group’s growth prospects and strategic direction.
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