NOVA Merchant Bank gets over 300% oversubscription on debut N10bn bond

Phillips Oduoza

NOVA Merchant Bank has announced the successful issuance of its N10 billion seven-year subordinated unsecured bond under its N50 billion debt issuance programme.

The transaction represents NOVA’s first bond issuance in the debt market and was oversubscribed by 300 percent.

The offer which opened on June 30 following approval from the Securities and Exchange Commission (SEC) and the Central Bank of Nigeria (CBN), closed on July 8 with a bond yield guidance of 12 percent to 12.50 percent.

In spite of volatility in markets due to COVID-19 pandemic, the transaction was highly demanded with a diversified order book made up of discerning investors including asset managers, insurance companies, domestic pension funds, non-financial institution corporates, high net worth individuals as well as international fund managers.

Chairman, NOVA Merchant Bank, Phillips Oduoza, expressed excitement over the success of the company’s debut issue as it places the bank on a firm footing to achieve its short-term and long-term goals.

He said: “The oversubscription of this bond offer is yet another significant milestone in the history of the bank and represents a vote of confidence by the investment community in the resilience of our business model. We will continue to march forward with confidence in the realisation of our strategic objectives.”

Mr Oduoza added that the bank is well positioned to fulfil its promise to focus on providing long-term funding which is critical to the economic development of the country. 

The bank’s managing director, Anya Duroha, said: “The resounding success of this bond offer helps us achieve our goal to re-establish merchant banking as a key economic driver by providing long-term funds. It will also help us better meet the financing needs of our clients.”