The corporate and investment banking division of Absa Bank Limited (Absa), member of Barclays, has successfully raised R1.16-billion for insurance group Sanlam Life Insurance Ltd (Sanlam) through a subordinated bond issue.Sanlam is one of Africa’s leading financial services groups.
Absa acted as co-lead arranger for the subordinated bond. The transaction represents the largest subordinated debt issuance for an insurer since 2006. The bond has been issued with a 10-year maturity, callable after five years and is expected to pay a fixed coupon of 8.7% semi-annually.
The terms of the bond comply with the expected (SAM) guidelines that will come into effect in 2016. The transaction marks Sanlam’s return to ZAR capital markets since its first issuance in 2006.
“This transaction further consolidates Absa’s long-standing relationship with Sanlam, which has a strong reputation and brand in the market. We were delighted to have taken Sanlam to the capital markets,” said Pieter Venter, Head of Non Bank Financial Institutions, Corporate and Investment Banking division of Absa.
Sanlam has achieved a high quality, diverse order book with R1.675bn of orders, comprising a broad range of local investors. About 95% of investors were allocated in the bond with Sanlam achieving its targeted issue amount within price guidance.
Prasanna Nana, Head of Debt Capital Markets at Absa, said: “We are proud to have been selected by Sanlam to raise funds in the domestic ZAR bonds markets. Raising an amount of this size at attractive pricing levels is a significant achievement. Moreover, it comes on the back of our ability to effectively leverage both Barclays’ global and Absa’s domestic knowledge of relevant regulations and capital markets in structuring both tailored and market-appropriate financing solutions.”
About Corporate and Investment Banking at Absa:
Corporate and Investment Banking, a division of Absa Bank Limited (Absa) and a member of Barclays Africa Group, is a leading South African corporate and investment bank with global reach, offering clients financing, risk management and advisory solutions in a wide range of currencies and structures across the globe.
+27 11 214 2409
+27 79 692 1676
For further information contact:
Marketing and Corporate Communications
+27 11 895 6695
+27 79 695 9798