- Project Deer : Fidelity Bank Plc - NGN30 billion 16.48% Bonds due 2022

Company Overview

  • Fidelity Bank Plc (“Fidelity” or the “Bank”) was incorporated in Nigeria as a Private Limited Liability Company on November 19, 1987 as Fidelity Union Merchant Bank Limited
  • It obtained a merchant banking license on December 31, 1987 and commenced banking operations on June 3, 1988
  • By 1990, it had distinguished itself as one of the fastest growing merchant bank in the country.
  • It converted to a commercial bank in 1999, following the issuance of a commercial banking license by the Central Bank of Nigeria
  • Fidelity Bank is today ranked amongst the top 10 in the Nigerian banking industry, with presence in most of the major commercial cities in Nigeria.

     

    Execution Background

  • Fidelity received permission to raise additional capital by creating and issuing bonds for public subscription.
  • To this end, the Bank initially planned to raise NGN35 billion through a Tier II debt offering
  • On the 13th of May 2015, Fidelity Bank Plc executed its inaugural local bond through a NGN30 billion issuance.
  • The Bank raised the required amount from the Nigerian Capital Market through a 7 year Fixed Rate Subordinated Unsecured Bond which was firmly underwritten by nine (9) underwriters
  • The issue was priced at 16.48% which is 30 day moving average of 16.39% JAN 2022 bond plus spread of 200 bps (subject to a floor of 15.25%)

     

    UCML’s Role and Key Achievements

  • This represents Fidelity’s debut local bond. The Subordinated nature of the instrument strengthened the Bank’s Tier II capital
  • Due to the bonds attractive yields, Fidelity was able to achieve its target size of NGN30 billion – the largest bond raised by a Tier II Bank
  • UCML acted as Joint Issuing House and committed to underwrite NGN2.6 billion of the offer
  • UCML ultimately placed NGN4.24 billion of the transaction which represents 14.1% of the amount raised

    View Transaction Terms

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