Africa’s largest bank by assets, Standard Bank, has been appointed by the New Development Bank (“NDB”) as the debt capital market co-arranger for their second local currency bond issuance.
NDB has raised R1.3 billion in its latest oversubscribed bond auction, bringing the cumulative total volume raised to R2.8 billion since its debut in the South African bond market in August this year.
NDB raised the funds across two tranches of notes on offer. The notes listed on the JSE interest rate market on 8 December 2023.
“The successful outcome of both the inaugural New Development Bank bond and recent bond is a clear illustration of the aligned values and desire the market has in driving sustainable growth in infrastructure for South Africa.” said Carl Wiesner, Head of Syndicate South Africa, Debt Capital Markets at Standard Bank Corporate & Investment Banking.
With over R1.6 billion in bids on both the 3- and 5-year tranches, the book was well-supported once more, allowing NDB to exercise its option to upsize the trade from R1 billion to R1.3 billion. The 3-year tranche priced at the tight end of guidance, 5bps tighter than the last auction. The 5-year tranche cleared at the midpoint of guidance with 97% of bids being within or lower than price guidance.
The multilateral development bank will deploy the funds raised into infrastructure and sustainable development projects to facilitate growth and development within South Africa.
“The New Development Bank is looking to expand its local currency funding programmes to support lending in its member countries. This second ZAR Bond issuance continues to pave the way for NDB to further fund much needed infrastructure and sustainable development projects in South Africa,” said Allister Lamont- Smith, Transactor in the Debt Capital Markets team at Standard Bank Corporate & Investment Banking.
Established in 2015 by BRICS countries, NDB has focused on six priority areas: digital infrastructure, social infrastructure, environmental protection, water and sanitation, transport infrastructure and clean energy and energy efficiency.
“Standard Bank has also supported NDB on this transaction across various agency roles on the programme, including debt sponsor and paying, settlement, transfer, calculation and issuer agent.”
“New Development Bank’s strategy of lending in rands significantly reduces risks to local borrowers. The Bank will be a regular issuer in the local market to fund its pipeline of rand-denominated loans for the development of infrastructure projects in South Africa,” said Paul Hoffman Treasury and Portfolio Management, New Development Bank.