NIC Bank Boosts Offer as Investors Seek Kenyan Corporate Bonds

NIC Bank Ltd., the best-performing banking stock in Kenya this quarter, sold more bonds than it planned as demand for corporate debt in East Africa’s biggest economy grows.

The medium-term note offer, which started Aug. 21 and ended Sept. 3, saw the company sell 5 billion shillings ($56 million) at a yield of 12.5 percent, according to an e-mailed statement today. Demand amounted to 6.5 billion shillings and the Nairobi-based lender offered 3 billion shillings. The company’s capital-raising plans include a 2 billion-shilling rights offer if it gets regulatory approval, it said.

“There is an increasing appetite and acceptance of corporate bonds as an alternative source of funding for Kenyan companies,” Maurice Opiyo, managing director of NIC Capital, the lender’s unit that arranged the bond, said in the statement.

NIC is raising money to boost lending to small- and medium-sized businesses and get more corporate clients, it said. The lender’s stock is up 27 percent in the third quarter, the best among seven banking shares on the Nairobi Securities Exchange, and traded 1.4 percent higher at 72.50 shillings by 1:39 p.m. in Johannesburg.

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