The Issuer is Wema Funding SPV Plc; a special purpose entity incorporated in June 2016 for the purpose of issuing bonds to the public, the sponsor and exclusively to cater for the funding needs of the Sponsor.
The Sponsor is Wema Bank, a mid-sized commercial bank in Nigeria, incorporated in May 1945, and commenced banking operations the same year.
The Bank’s shares were originally listed on the NSE in 2004, but FCMB delisted from the local bourse in 2013, following the adoption of a holding company structure by FCMB Group Plc (“the Group”), with FCMB becoming a wholly owned subsidiary of the Group.
The Group is currently listed on the NSE.
In September 2016, Wema Bank Plc issued its first ever debt instrument to the local debt markets through a sponsored SPV.
As a result of the rating of the Bank (BBB-), a subordinated bond issued by the bank becomes non-investment grade. Hence, the use of an SPV.
The proceed from the bonds issued by the SPV was invested in a sub-debt of the bank and in FGN securities.
The transaction followed successful investor forum held in Intercontinental Hotel, Lagos on the 16th of August 2016.
The book build period opened on 6th September 2016 and closed on 21st September 2016.
Indicative pricing was 17.50% - 18.50%. The order book grew rapidly allowing final pricing to be set at a yield of 18.50%.
UCML’s Role and Key Achievements
UCML acted as Lead Issuing House/Financial Adviser on the transaction
UCML advised the bank on the most feasible bond structure given the rating of the bank
UCML structured the deal to meet regulatory and investors’ standards. As such, the bank was the second to issue a BBB- debt within the local market
UCML successfully led the transaction and raised the much needed funds even in a depressed market.
ss UCML’s sales team collected very strong feedback during meetings with investors – institutional and retail