FirstBank Redeems $300m Subordinated Notes

First Bank of Nigeria Limited yesterday effected payment to holders of its $300 million 8.25 per cent subordinated notes due for August 2020.

This followed a notice given on 6th July, 2018, by First Bank of Nigeria Limited to FBN Finance Company B.V, of its intention to redeem the notes due August 2020.

The debt instrument was issued to investors in 2013.

However, the bank in a statement by its Managing Director/CEO, Mr. Adesola Adeduntan, revealed that, “payment of $300million to all bondholders, has been made today, Tuesday, August 07, 2018.”

According to Adedutan, the redemption of the notes ahead of maturity further demonstrated the strength of the bank’s foreign currency liquidity and the resilience of its balance sheet.

“Despite the 2020 bond being a subordinated tier-2 instrument, we are able to redeem this without any impact on our capital ratios, as a result of the surplus tier-2 capital we currently hold which confirms the robust capital base of our bank.

“To ensure the smooth redemption, we had systematically built up internal foreign currency liquidity on the back of our strong franchise and our deep market access in the course of the last year.

“We are unlikely to be re-issuing debt in Eurobond markets in the near term following this planned redemption, as reissuance will be a function of our funding needs, market conditions, expected pricing in relation to alternative funding structure and sources,” he added.

He maintained that presently, the bank has ample liquidity to meet its foreign and local currency funding needs and maintains sufficient market access to raise additional funds, if required.

According to him, the bank remains focused on delivering on its strategic objectives and continues to execute towards; improving its asset quality and risk management; enhancing revenue generation; and optimising operational efficiency.