TEMPLARS Advises on the First Additional Tier 1 Eurobond Out of Nigeria

The two-track transaction included the first-ever additional Tier 1 Eurobond issuance by a Nigerian bank and the second out of Africa. The US$500 million perpetual fixed-rate resettable non-cumulative non-call 5.25 additional Tier 1 (AT1) subordinated notes were issued as a drawdown under the bank’s US$1.5 billion Global Medium Term Note Programme.

The innovative groundbreaking debt instruments which count as part of the bank’s regulatory capital were preceded by the issuance two weeks earlier of another US$500 million of 6.125% senior unsecured Eurobonds due 2026 by the bank.

According to Partner and Finance Practice Group Head Chike Obianwu, “This was a particularly complex and exciting transaction. The novelty of the AT1 issuance meant that the lawyers and other advisers on the deal had to craft a new framework for this unique specie of bank capital in Nigeria. TEMPLARS is pleased to have had a leading role in shaping the market and the rules for regulatory capital, creating a new path for capital-raising among Nigerian banks.”

The Joint Bookrunners on the AT1 issuance were Citi, J.P. Morgan, Renaissance Capital and Mashreqbank, along with Chapel Hill Denham and Coronation Merchant Bank as Financial Advisers and Joint Bookrunners, while Absa, Barclays Bank, JP Morgan and Standard Chartered acted as Joint Bookrunners on the senior Eurobond issuance along with Chapel Hill Denham and Rand Merchant Bank as Financial Advisors and Joint Bookrunners.

The Templars team that advised on both issuances was led by Chike Obianwu, with support from Partner Zelda Akindele and Associates Okabonye Chukwuani, Anwuri Akolokwu and Victor Olusegun. A team from Banwo & Ighodalo acted as joint Nigerian counsel to the Joint Bookrunners, while a London-based team from an international law firm, White & Case, acted as English and U.S. counsel.