(Bloomberg) -- Nigeria’s biggest bank is considering selling dollar-denominated securities in the domestic market to fund its expansion plans and meet capital rules set by the central bank.
Access Bank Plc, the West African nation’s biggest lender by assets, is targeting two tranches of dollar-denominated instruments, Managing Director Roosevelt Ogbonna said, without disclosing how much it wants to raise. One of the batches will be targeted at development financial institutions and the other will be sold on the open market, Ogbonna said at a briefing in Lagos, Nigeria’s commercial hub on Monday.
While the bank is still working on the structure of the instruments, Ogbonna said the tranche targeted at DFIs will be raised and completed by the first half of next year. It will use the government’s first domestic sale of dollar-denominated bonds as a guide, he said.
President Bola Tinubu’s administration sold five-year notes at a coupon of 9.75% and raised $900 million last month, almost double the targeted amount. Resident Nigerians and firms have accumulated dollar savings over the years as a hedge against a weakening naira.
Investors were attracted to the bonds as they offered very high returns and a hedge against foreign-exchange devaluation. The naira has lost more than 70% of its value since June last year after it was allowed to trade more freely against the dollar.
Access Bank, which has operations in 24 countries, has previously indicated that it aims to become one of the continent’s biggest lenders over the next five years, by doubling its share of assets outside of Nigeria.
The bank, owned by Access Holdings Plc, will expand to the US by the first quarter of 2025 or 2026 at the latest and its UK unit will open an office in Hong Kong on Oct. 30, Ogbonna said.
The lender is also seeking to boost its capital after the Central Bank of Nigeria earlier this year gave banks two years to meet new thresholds.
©2024 Bloomberg L.P.