FCMB Capital facilitates N3.15 billion bond listing for LAPO
Microfinance bank lends N136b, targets expansion
FCMB Capital Markets Limited has facilitated a successful fundraising and listing of LAPO Microfinance Bank Limited’s N3.15 billion bond on the FMDQ OTC platform.
The feat by the investment banking subsidiary of FCMB Group, demonstrated its advisory and capital raising capability by acting as financial adviser and Lead Issuing House on the exercise.
Meanwhile, LAPO Microfinance has said it was only able to deliver N135.7 billion loans in 2017, in a market it assessed the gap between the demand by micro, small and medium businesses and the supply as still huge.
The bond, which is the first ever by a microfinance bank to raise money in Nigeria’s debt capital market, was priced at 17.75 per cent, with five-year tenor and rated A- by Agusto & Co and BBB+ by GCR.
FCMB Capital Markets, as a financial adviser, was responsible for, among others, developing a robust transaction structure that ensures flexibility for the issuer and comfort for the investors, and assisting to obtain regulatory approvals.
The Executive Director of FCMB Capital Markets Limited, Tolu Osinibi, said: “We are excited and grateful at having been given the opportunity by LAPO Microfinance to have played a leading role on this landmark transaction.“The success of this transaction speaks to the institutional strength of LAPO and an affirmation of this strength by institutional investors that have trusted LAPO with the funds they manage.
“Following the success of its capital markets debut, we at FCMB Capital Markets expect to see LAPO become a repeat issuer, and we also anticipate that this landmark transaction will open up the capital markets to other microfinance institutions that meet the criteria”.
The Chief Executive Officer of LAPO Microfinance, Dr. Godwin Ehigiamusoe, said the capital market remains one of the most viable and affordable options for medium and long term financing for on-lending.“We have therefore, made a very sound decision. With excellent corporate governance, experienced management, committed staff and extensive footprints across Nigeria, LAPO Microfinance is poised to deliver its core mandate of enhancing financial inclusion.
“We will continue to enable the under-banked and economically active poor to become active participants in the national economy.’’
LAPO Microfinance commenced operations in 2010, with banking activities targeted at micro, small and medium enterprises, particularly women and micro enterprise owners.
The proceeds will be used to deepen its business in the country, strengthen its capital base, expand its branchless banking solutions and enter new market segments, including the launch of its agency banking model and the deployment of e-business solutions, among others.
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