BOI Secures €1 Billion Loan Facility to Finance Nigerian MSMEs, Large Scale Enterprises
The Bank of Industry (BOI) has officially announced the successful completion of a landmark EURO 1 billion Guaranteed Senior Loan Facility. The successful close of this deal has further enhanced BOI’s capacity to deliver on its mandate which is in line with President Muhammadu Buhari’s economic diversification agenda.
The Initial Mandated Lead Arrangers (IMLAs) and Underwriters for the senior phase of the transaction led and coordinated by Africa Finance Corporation (“AFC”) and Standard Chartered Bank include: Absa Bank Limited (acting through its Corporate and Investment Banking division), First Abu Dhabi Bank PJSC, FirstRand Bank Limited (London Branch), acting through its Rand Merchant Bank division, Mashreqbank PSC, Nedbank Limited, London Branch, SMBC Bank International Plc.
African Export-Import Bank (“Afreximbank”) is the Agent Bank. A syndicate of financial institutions arranged by the IMLAs has indicated strong interest in participating in the general phase of the ongoing syndication. BOI has an option to increase the facility size up to EURO 1.5 billion after the general syndication.
The deal is unique and the first of its kind by any financial institution in Nigeria in terms of its size and structure. The transaction structure leverages the strong investment grade credit rating of AFC (rated A3 with a Stable Outlook by Moody’s) to wrap and credit-enhance BOI thereby benefiting from favourable terms that would otherwise not be available, especially in these highly volatile markets.
At a time when international capital markets are shut to many borrowers and when capital is prohibitively expensive, through this innovative transaction structure and the AFC Guarantee, BOI was able to raise liquidity and diversify its funding sources and attract new lenders.
This is the 5th time BOI has successfully raised funds in the international markets since 2018. The proceeds of this deal, like in our previous fundraising transactions, will be utilized to provide much-needed medium to long-term finance to Nigerian MSMEs and Large Enterprises with bankable transactions at affordable Naira interest rates.
