Union Bank offers N20bn Commercial Paper

Union Bank of Nigeria Plc has announced that all is set for the issuance of its Series 3 and 4 Commercial Paper Issuance.

In its notice to the Nigerian Stock Exchange (NSE) dated 17th January 2020, the lender said the capital-raising exercise followed “the debut issuance of the Series 1 and 2 offer in domestic capital market, which successfully raised N24.3 billion in January 2019.”

Commercial Papers are debt instruments issued by large corporations to source funds aimed at meeting short term debt obligations.

They are backed only by a promise from the issuing bank or company to pay the fixed amount stated on the document at maturity.
The Series 3 and 4 CP with 180-day and 268-day tenures respectively opened on 16th January 2020. They are timed to close on 21st January 2020. N20 billion is the target issuance size across both tenures.

Stanbic IBTC Capital Limited and Union Capital Markets Limited are the dealers on the CP issuance. The CP is expected to be listed on FMDQ OTC Securities Exchange platform.

Read also: Continental Reinsurance exits NSE

Union Bank disclosed, that the offer had institutional investors, including pension and non-pension asset managers and high net-worth individuals in mind as its target.

Fund raised through the CP will be utilised by the bank as additional working capital, the document said.

With an asset base in excess of N1.8 trillion and total equity of more than N240 billion as of 30th September, 2019, Union Bank currently boasts of roughly 5.6 million active customers spread over 280 branches and cash centres in Nigeria.

The 102-year old lender launched its operations in Nigeria in 1917 when British-owned Colonial Bank set foot in Nigeria. It was acquired by Barclays Bank, another British bank, before it metamorphosed in 1979 to Union Bank of Nigeria Plc.

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