Standard Chartered, IFC Introduce Pan-African Bond Program

Standard Chartered Plc (STAN) and the International Finance Corp., a unit of the World Bank, introduced a bond-issuance program to finance local-currency loans for African businesses.

The pan-African medium-term note program will initially focus on Botswana, Ghana, Kenya, South Africa, Uganda and Zambia, the lenders said at a media briefing in Johannesburg today. An existing IFC bond-sale schedule in Ghana will be included in the pan-African program if the government in that country approves, Jingdong Hua, vice president and treasurer at the IFC, said at a media briefing in Johannesburg today.

“We have been working with our partners in government and central banks for several years to strengthen debt markets in Africa,” said Thierry Tanoh, vice president for sub-Saharan Africa at the IFC. “The program will provide us with funds that we can invest in business and support key areas like infrastructure.”

The IFC hopes to receive approval from governments and regulators in targeted countries to sell bonds within six months and will look for market opportunities after that, Hua said. By issuing bonds in local currency, domestic borrowers and lenders won’t be exposed to currency risk, while foreign investors who are “comfortable” with the IFC’s reputation may also invest to gain currency exposure, Hua said.

Africa Growth Story

“It will enable international investors to participate in the African growth story,” Richard Etemesi, said chief executive officer of Standard Chartered Bank Kenya Ltd. (SCBL) and general manager for East Africa.

Sub-Saharan Africa will expand 5.4 percent this year, the fastest-growing region after developing Asian nations, the International Monetary Fund said April 1.

The IFC plans to sell 10- and 15-year bonds in Ghana this year, the West African nation’s central bank said Jan. 12. It aims to raise 1 billion cedis ($533 million) within five years and 2 billion cedis within 10 years, it said.

To contact the reporter on this story: Stephen Gunnion in Johannesburg at sgunnion@bloomberg.net

To contact the editor responsible for this story: Ana Monteiro at amonteiro4@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.