Nigeria's unit of Ecobank Transnational Incorporation (ETI) has signed a $170 million loan, marking only the second internationally syndicated loan this year for a Nigerian bank, as depressed oil prices bite into the country’s liquidity.
Standard Chartered acted as sole coordinator and documentation agent on the deal, which raised $20 million more than the borrower's inaugural $150 million October 2014 facility that it refinances.despite the adverse market conditions,
Ecobank also managed to attract four new lenders into the syndicate group, but pricing on the deal was hiked to 525 basis points over Libor, up 100 basis points from the 425 basis points margin paid on last year's loan. The bank had initially hoped to raise $200 million but lowered the target amount to $150 million at launch.
“Ecobank 's goal was $200 million before launch but we felt that $150 million was more reflective of what was available in the Nigerian market. It’s a difficult market,” said Charles Corbett, managing director, loans syndication at Standard Chartered.
Ecobank had also initially hoped to build on last year's success by reducing pricing and extending the tenor on the second loan, said Corbett.“The margin is higher than Ecobank paid on its previous deal, but the bank was very mature when approaching its lenders. It is extremely rare for a Nigerian bank borrower to come to the market this year and Ecobank did not want to push beyond what is acceptable in this market, which is reflected in the success of the deal. They called it correctly,” says Corbett.
Commerzbank, First Gulf Bank, Mashreqbank and Standard Chartered Bank were mandated lead arrangers and bookrunners. African–Export Import Bank was mandated lead arranger, while BMCE Bank International acted as lead arranger. British Arab Commercial Bank, Ghana International Bank and SMBC acted as arrangers, with Banque Libano-Francaise as lead manager. Commercial Bank of Qatar, which contributed US$10m to the 2014 facility, did not participate in the new deal reflecting how the squeeze on Middle Eastern liquidity is having a knock on effect in other regions. However, the slack was taken up by the four new lenders to the group -- Afreximbank, GIB, SMBC and Banque Libano-Francaise.Ecobank Nigeria’s managing director, Mr Jibril Aku said: “The transaction is driven by a need to have longer-term funding available for corporate clients. We appreciate the confidence that the international markets have in Ecobank Nigeria, backed by our strong reputation in the country and across the continent. It proves our strategy works.”
Commerzbank, First Gulf Bank, Mashreqbank and Standard Chartered Bank were mandated lead arrangers and bookrunners. African–Export Import Bank was mandated lead arranger, while BMCE Bank International acted as lead arranger. British Arab Commercial Bank, Ghana International Bank and SMBC acted as arrangers, with Banque Libano-Francaise as lead manager. Commercial Bank of Qatar, which contributed US$10m to the 2014 facility, did not participate in the new deal reflecting how the squeeze on Middle Eastern liquidity is having a knock on effect in other regions. However, the slack was taken up by the four new lenders to the group -- Afreximbank, GIB, SMBC and Banque Libano-Francaise.Ecobank Nigeria’s managing director, Mr Jibril Aku said: “The transaction is driven by a need to have longer-term funding available for corporate clients. We appreciate the confidence that the international markets have in Ecobank Nigeria, backed by our strong reputation in the country and across the continent. It proves our strategy works.”
The only other loan for a Nigerian bank agreed this year was First City Monument Bank's US$77m deal that signed in November.Ecobank, a subsidiary of Togo-based Ecobank Transnational Incorporated has a customer base of over seven million people and is listed on the Lagos, Accra and Abidjan stock exchanges
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