AfDB plans $130 mln in local currency bonds in Nigeria, Zambia

The African Development Bank (AfDB) expects to issue a total of $130 million in local currency bonds in Nigeria and Zambia within the next few months, a senior bank official said on Thursday.
The bank's local currency issuances, first started in 1998, are aimed at building domestic capital markets across the continent and improving financial liquidity in some of the world's fastest-growing economies.
"The idea is to complete the Nigerian and Zambian issuance in the coming months and then start the process in Kenya and Tanzania," Olivier Eweck, the AfDB's head of local currency funding, told Reuters on the sidelines of an African capital markets conference.
 The bank plans to issue around $100 million worth of local currency debt in Nigeria and around $30 million in Zambia, Eweck said, adding that the issuances were linked to infrastructure and financial services projects.
 The AfDB and the World Bank's private sector arm, the International Finance Corporation, have been pushing local currency issuance in Africa, with the IFC in September raising 150 million Zambian kwacha at a yield of 15 percent in its first issuance.
Eweck said domestic investors will get preference when the debt is issued.
"We are also there to develop the local market, meaning that even if there is 200 percent foreign demand and there is still demand from the local market, they will have priority over our issuance," he said.
According to the AfDB's website, the bank's local currency loan portfolio was established more than 20 years ago and  now totals more than $2.4 billion.
Eweck said this could easily double in the future with potential local currency bonds being eyed in Mozambique, Botswana and Morocco.
"We are going to do it in phases and the idea is to do two to three issuances per year," he said.