Fidelity Bank raises N30bn via bond issuance

Nnamdi Okonkwo: Managing Director Fidelity Bank Plc

Fidelity Bank Plc has raised N30bn through an unsecured bond at 16.48 per cent, to fund increased lending to small businesses and retail clients, financial advisers to the issue have said.

The bond prospectus showed that the fixed-rate bond due 2022 was fully underwritten and would be quoted on the Nigerian Stock Exchange. Fidelity Bank can redeem the bond after five years, according to the prospectus.

Banks have been shoring up their balance sheets after adopting stricter international capital requirements, which has meant capital ratios for most lenders dropping by between 100 and 400 basis points to near the regulatory minimum of 16 per cent.

Fidelity, whose other borrowings including a $300m debut Eurobond amounted to N90.73bn as at December 2014, has a capital ratio of 22.6 per cent. Shares in the bank, which fell 39 per cent last year, were up three per cent at N1.70.

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