Family Bank has opted to tap overwhelming interest in its corporate bond accepting an extra Sh1 billion on top of the Sh3 billion targeted.
The lender received bids worth Sh4.4 billion, an oversubscription of 147.3 per cent and the first high interest in a bond since 2015 when Imperial Bank floated their ill-fated issue.
This is the first tranche of a Sh8 billion bond offer in fixed and floating interest notes that the Capital Markets Authority (CMA) approved.
"We are delighted with the performance of the Family Bank medium-term note, which is instrumental in reviving our corporate bond market. We have, therefore, allowed the bank to take up from the investors the Sh3 billion that was approved for the first tranche and the extra Sh1 billion offered by the same pool of investors, which is the green shoe option," CMA chief executive Wyckliffe Shamiah said yesterday.
Family Bank has given a shine to a declining corporate bond market that has seen papers redeemed with very few companies making new offers.
In April, Family Bank fully settled the interest and principal of the Sh2.019 billion medium-term note that it borrowed five years ago to fund growth.
East African Breweries has also announced plans for an early repayment of a Sh6 billion bond.
