ABIL raises R800 million in long-term funding thro
ABIL raises R800 million in long-term funding through DMTN programme
African Bank Investments Limited
(Registration Number 1946/021193/06)
(Incorporated in the Republic of South Africa)
(Registered bank controlling company)
Ordinary Share Code: ABL ISIN: ZAE000030060
Preference Share Code: ABLP ISIN: ZAE000065215
(`ABIL` or `the Company`)
ABIL RAISES R800 MILLION IN LONG-TERM FUNDING THROUGH DMTN PROGRAMME
ABIL announces that its major subsidiary, African Bank Limited, has successfully
raised R500 million in long-term debt funding through the private placement of a
new bond (ABL4) out of its existing DMTN programme. The ABL4 bond has a 5-year
maturity, ranks as senior unsecured long-term debt and was issued with a 9% semi
annual coupon. The issue pricing was set at 150 basis points over the R153
government benchmark bond, which compares favourably to the 215 basis point
spread for previous African Bank bond issued (ABL3 with a 3-year maturity) in
July 2004. The private placement was initiated and arranged by Futuregrowth
Asset Management and Rand Merchant Bank (a division of FirstRand Bank Ltd), and
was also participated in by Old Mutual Specialised Finance.
Futuregrowth (on behalf of its client portfolios) and Rand Merchant Bank have
further underwritten an additional R300 million issue of the ABL4 bond, also
priced at 150 basis points above the R153 bond on the date of drawdown.
This was the 4th successful issue of bonds under African Bank`s domestic medium-
term note programme (arranged by Nedbank Capital) since it was created in 2001.
Under the terms of the programme, up to R3.5 billion of bonds may be outstanding
at any point in time, and all the notes are listed on the Bond Exchange of South
Africa. To date, African Bank has issued R3.5 billion in notes, of which R2.5
billion are still outstanding. The R1 billion ABL1 bond matured in February
2005.
ABIL financial director David Woollam said `The bond was issued to lengthen the
funding profile of the bank and to finance medium-term asset growth. We are
pleased that the confidence of the debt market in the business of African Bank
is demonstrated in both the reduced credit spread of this bond as well the
increased term from 3 years for previous bonds to 5 years for the ABL4`.
Sandton
22 August 2005
Sponsor
Deutsche Securities (SA) (Proprietary) Limited
Date: 22/08/2005 01:44:17 PM
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