Land Bank raises R1.2 billion in bond issue  

The Land and Agricultural Development Bank of South Africa (Land Bank) has raised R1.2 billion in the South African corporate bond market. This issuance marks the successful return of the Land Bank to the domestic term bond market after having last issued in 2002.

The proceeds of the issue will be used to further improve liquidity at the Land Bank and lengthen the bank’s debt maturity profile. After significant progress in the turnaround strategy of its business, the Land Bank was well positioned to access the debt capital market. The success of the capital raising demonstrates the market’s confidence in the Land Bank.

Vincent Potloane, Chief Treasurer of the Land Bank, said: “We are delighted that we have managed to re-launch our debt capital markets curve at attractive pricing levels. We thank investors for their support.”

Prasanna Nana, Head of the South African Debt Capital Markets team at Absa Capital, said: “Total investor bids for the bond amounted to R2 billion with strong and diverse investor support in the orderbook.”

The Land Bank issued a three-year floating rate bond maturing on 25 October 2013, paying interest at three month JIBAR plus 160 basis points. The bond has an issuer rating of Fitch AA (zaf) / F1+ (zaf) / Stable.

“The issuance of this bond is an important move for the Land Bank towards broader and more diversified funding sources,” said Ayanda Sisulu-Dunstan, Co-Head of Debt Capital Markets at Rand Merchant Bank.

Absa Capital, Rand Merchant Bank, IDG Financial Services and Vunani Capital acted as co-arrangers on the issuance. Poswa Inc acted as legal advisor for the Land Bank.

The Land Bank is the primary development finance institution addressing agriculture and rural development by offering customised financial services to established and emerging farmers.


About Absa Capital
Absa Capital, a division of Absa Bank Limited (Absa) and affiliated to Barclays Capital, is a leading South African investment bank with global reach, offering clients financing, risk management and advisory solutions in a wide range of currencies and structures across the globe.

Absa Capital was rated the 'Best Primary Markets House' in the 2009 JSE Spire Awards (one of nine first place rankings the firm secured at the awards) and 'Best Debt House in South Africa' in emeafinance's African Banking Achievement Awards 2010. The team was also ranked #1 on the Bloomberg 2010 Underwriter Rankings league table.

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Wendy du Plessis
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Graeme Coetzee
Associate Principal
Marketing and Corporate Communications
Absa Capital
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