Standard Bank Namibia Limited N$ 150 million Tier II Bond Issue

Standard Bank Namibia Limited has issued an N$ 150 million subordinated unsecured callable bond, due 20 November 2011. The bond is the first to be issued by Standard Bank Namibia and the first corporate bond to be listed on the Namibian Stock Exchange.

The issue, which qualifies as regulatory Tier II capital for Standard Bank was privately placed with a spread of domestic institutional investors.

“The bond issue was well received by investors and was oversubscribed,” says Owen Tidbury, Standard Bank Namibia Managing Director.

The bond was launched at a spread of 180 bp to the GC05 (Namibian government bond) to give a yield of 12.08%. Standard Bank roadshowed the issue last week, indicating to investors that it was looking to raise between N$ 100 million to N$ 150 million. “Due to the success of the roadshow, we were able to issue the full N$ 150 million,” says Tidbury.

The bond has a maturity of 10 years. However, Standard Bank has the option to call the bond on 20 November 2006 and on any interest payment date thereafter. The bond initially pays a fixed annual coupon of 12% on a semi-annual basis. If the bond is not called, the coupon switches to the GC10 plus 280 bp until maturity.

Standard Corporate and Merchant Bank (SCMB), a division of the Standard Bank of South Africa Limited, was the lead manager on the transaction. The bond was placed by IJG (Pty) Ltd and SCMB. IJG is the sponsoring member.