Following the successful establishment of its N30 billion Commercial Paper (CP) Programme on August 23, 2016,FSDH Merchant Bank Limited has launched its debut commercial paper issuance to raise up to N15 billion in the Nigerian money market with the issue of a Series 1 90-day and Series 2 269-day CP.
The CP offers were open to investors on August 24, 2016 and subsequently closed on August 29 2016 with subscription levels of over N17 billion. The Bank elected to allot N14.98 billion to investors across both series, in line with its initial target amount.
The CP Programme will afford FSDH periodic access to the money market for short term funding as and when required. The funds raised from the now concluded Series 1 and 2 Issuance will be applied by the Bank for its general banking asset and liability management purposes including replacement of maturing wholesale liabilities.
The FSDH CP Programme is the first ever to be established by a Merchant Bank in Nigeria under the new guidelines on commercial paper from the Central Bank of Nigeria, published in 2009.There was strong retail and institutional investor (including pension funds, asset managers, insurance companies, trustees and high net worth individuals) participation in the offer. This demonstrates confidence in the FSDH brand as evidenced by the acceptance of the issues in the market by the diverse categories of investors to whom the securities were distributed.
At the signing ceremony that was held at FSDH’s head office in Lagos, on 23August 2016, Rilwan Belo-Osagie, the managing director of FSDH, commented “We are very pleased with the establishment of this Commercial Paper programme for FSDH and the dedication and support of the advisors in making this a success. FSDH was very active in the commercial paper market prior to 2009and the establishment of this CP programme serves as an opportunity for the Bank to restate its presence and significance in the money market and participate in the development and deepening of commercial paper market under the new regulations”.
The notes will be quoted on the FMDQ OTC platform to facilitate active secondary trading of the CPs.
Arrangers on this transaction include FSDH Merchant Bank Limited (via its investment banking unit), Stanbic IBTC Capital Limited (a member of Standard Bank Group) and United Capital Limited. FSDH Merchant Bank Limited is acting as the Issuing, Calculation and Paying Agent.
2012, FSDH obtained approval from the CBN to operate as a merchant bank and officially changed its name from First Securities Discount House Limited to FSDH Merchant Bank Limited in December 2012. FSDH commenced its merchant banking operations in January 2013.
FSDH provides a one-stop shop for financial services in Nigeria as it offers corporate and investment banking and wealth management services to its clientele. Its service offerings include asset management, fixed income and foreign currency trading, equities trading, wealth management, corporate banking and other investment banking services which it offers through the Bank and its three independently managed subsidiaries: FSDH Asset Management Limited, FSDH Securities Limited and PAL Pensions Limited.
HOPE MOSES-ASHIKE
