Nigerian Bank’s $500 Million Eurobond - Page 2
GT Bank was founded in July 1990 and at end of the last financial year was Nigeria’s fourth largest by assets. It has a good net interest margin. Several leading stockbrokers, including Exotix, over the last 12 months have tipped Nigerian banks as a key investment for frontier markets enthusiasts.
On 6 May the Government of West Africa’s Senegal issued a more liquid 10-year $500 million Eurobond carrying a coupon of 8.75%, as reported on www.africancapitalmarketsnews.com. The bond was priced at 97.57 when it was issued, the equivalent of a yield of 9.125%. Standard Bank noted it represented a spread of 596 basis points over comparable US Treasuries. Standard Bank researcher Samir Gadio said a total of $2.4 billion was bid for the bond. In trading after the issue the mid-price climbed to around 102.75 on 11 May, representing a yield of 8.3% and spread of 508 bps. He adds in an investor note: “further upside is probable as the bond is likely to be included in the EMBI index in late May”.
Senegal is rated B+ by Standard & Poors and B1 by Moody’s and Nigeria is rated B+ by S&P and BB by Fitch.