Investors worldwide have indicated a warm acceptance of the Diamond Bank brand at its recently concluded inaugural Eurobond issuance exercise with the printing of $200mn worth of bonds with a maturity of 5 years.
Commenting on the successful completion of the road show with international fixed income investors, Group Managing Director/CEO of the Bank, Dr. Alex Otti said the Bank is pleased with the turn of events as it demonstrates a global acceptance of the efforts aimed as positioning the Bank as a market leader.
“The successful issuance of the Eurobonds is yet another milestone in the growth trajectory of the bank. Three years ago, we embarked on the task of transforming Diamond Bank into a leading player in the Nigeria Banking industry and having moved four positions from the 11th largest bank in terms of total assets size to 6th, we are quite convinced that we are on the right path. The success of this Eurobonds issuance exercise has effectively launched Diamond Bank into the international market and we will continue to tap from this opportunity in a phased manner as the opportunities present themselves,” said Dr. Otti.
The bank had recently announced its intention to meet with international fixed income investors on a roadshow with a target to raise between $200mn and $300mn.
Explaining the rationale behind the capital raising exercise and the decision of the Bank to peg the maturity of the funds at 5 years, Chief Financial Officer of the Bank, Mr. Abdulrahman Yinusa said, “The proceeds of the bonds will be used to fund growth of the business. With the remarkable growth we have recorded in the last three years, we have grown our loan book significantly, with a large portion of the loans extended to major players in the Oil and Gas, Telecommunications and Power sectors.”
“In addition, we will deploy some of the proceeds into funding our short tenured Trade Finance transactions, which is another area of strength for the Bank. Though we are currently the 6th largest bank in the country, we have consistently ranked amongst the top 3 in Trade Finance. This led to us to receive the award of the Best Issuing Bank in Sub-Sahara Africa by the International Finance Corporation (IFC), an arm of the World Bank earlier this year,” concluded Mr. Yinusa.
Diamond Bank’s recently issued Eurobonds have been rated “B”, by both Standard & Poor’s and FitchRatings riding on the enterprise rating of the Bank by both rating agencies.
It will be recalled that the Bank in its audited full year accounts for 2013 declared a profit before tax of N32bn. For two consecutive years, the Bank has also been named the Best Oil and Gas Investment Bank by the London-based World Finance magazine.