14 April 2014

Nigeria: Zenith Bank's U.S.$500 Million Eurobond Oversubscribed

Zenith Bank Plc has recorded over-subscription of 200% in her US$500m Eurobond issue under a US$1bn Global Medium Term Note (GMTN) Programme announced on 1 April 2014.

The bank's weeklong investors' roadshow, coordinated by Goldman Sachs and Citibank, received an overwhelming endorsement by a diversified group of global investors from Europe, the US, Africa, Asia and the Middle East.

Investor's perception of Zenith's domestic market acceptance and its strong balance sheet defined by its liquidity, asset quality and capital adequacy are among the major factors driving the overwhelming acceptance of the bank's first ever debt issue. The bank is considered to be highly innovative but prudent and customer-service focused. This has also elicited investors' appetite for its shares currently trading on both the Nigerian Stock Exchange and the London Stock Exchange (through a GDR programme), a patronage which has been reflected in the oversubscription of the its first debt issue.

Also, the bank's conservative approach to banking exemplified by its robust Capital Adequacy ratio of 26% as at 31 December, 2013 Strong Liquidity ratio of 64%, prudent Loan to Deposit ratio of 55% and Strong Risk management culture confirms Zenith as the strongest Credit in the Nigerian banking Clime.

As an affirmation of the confidence reposed by investors on the bank, two leading rating agencies, Standard and Poor's Ratings Services and Fitch Ratings, rated both the programme and the first tranche of US$ 500 million issued as BB- and B+ respectively. It is also worthy of note that Standard and Poor's Ratings Services had in its 2013 Issuer Rating of Zenith Bank noted that "the main constraint on Zenith's Ratings is the Sovereign ratings of Nigeria... "

The GMTN Programme gives Zenith the opportunity to raise up to US$ 1 billion out of which a first tranche of US$500 million has been issued.

This offer is priced at a coupon rate of 6.25% payable every six months, the first US$500 million tranche has an effective date of 22 April 2014 and maturity date of 22 April 2019 and is 100% redeemable on maturity.

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