Standard Chartered Bank has started syndicating a term loan on Feb. 3 for Union Bank of Nigeria, according to e-mailed statements from the arranger.
The tenor of the loan is 3 years, with interest of Libor plus 450 basis points (bps).
The repayment amortization will commence after a one year grace period.
The debt is expected to finance the banks US dollar trade finance business and general funding requirements.
Union Bank was one of eight lenders bailed out in 2009 by the country’s central bank. The banks received $800 million which was fully paid back in 2012.
A debt crisis in 2008 and 2009 resulting from loans given to speculators on the local stock exchange and investors in the oil industry threatened the Nigerian banking system. The central bank fired eight leaders of the country’s 24 lenders and set up the Asset Management Corp. of Nigeria, or Amcon, to buy bad debts and stabilize the industry.
UBN was acquired by private equity firm Africa Capital Alliance in 2012. The stock closed trading at N9.52 a share last week Tuesday, giving it a market capitalisation of N161 billion.
