Washington D.C., August 24, 2023—IFC today announced that it has issued a 193.2 million Zambian kwacha bond—equivalent to approximately $10 million—to support the development of the country's domestic capital markets and increase access to local currency finance.
The five-year, amortizing "Zambezi" bond—which was oversubscribed—was issued as a floating rate note, paying a coupon based on the 182-day Zambian Treasury bill yield minus 50 basis points. Proceeds will support IFC's local currency investment program in Zambia.
This is IFC's second kwacha-denominated bond after the corporation placed the first bond issued by a nonresident issuer in Zambia's domestic capital markets in 2013. The issuance is the corporation's first floating rate note in Zambian kwacha and forms part of IFC's registered Medium Term Note program in Zambia as well as IFC's Pan-African Domestic Medium-Term Note Program (PADMTN). IFC will be exploring additional issuances in the currency in the future to raise funding for its investment projects in the country.
"Deep and liquid domestic capital markets are essential to expanding access to much-needed local currency finance for key sectors in the economy," said John Gandolfo, IFC Vice President and Treasurer, Treasury & Mobilization. "Scaling up local currency financing is a key priority for IFC and we're delighted to be back in the Zambian market."
Absa Bank Zambia was the lead arranger and First National Bank Limited the co-arranger for this issuance.
"The successful bond issuance is a testament to the credit quality of the issuing entity, IFC. This transaction also demonstrates the critical role that the private sector plays in helping the country's capital markets and driving economic growth," said Jason Quinn, Absa Group Chief Financial Officer. "Absa takes pride in its commitment to continue to play a role in promoting and developing access to capital markets for our clients in Zambia and across the African continent."
“Leveraging on our international expertise, FNB is aptly poised to complement IFC’s work to extend key access to finance that will accelerate business growth in the country and across borders,” said Bydon Longwe, FNB Zambia Chief Executive Officer.
To date, IFC has issued bonds in 59 currencies, including in emerging market currencies such as Azerbaijan manat, Uzbek som and Jamaican dollars. The corporation has often been among the first non-domestic issuers to borrow in these markets.
IFC's work in Zambia is focused on promoting sustainable private sector development by improving the investment climate, supporting small businesses and proactively engaging in the development of key sectors such as infrastructure, agribusiness and financial services.
About IFC
IFC — a member of the World Bank Group — is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2023, IFC committed a record $43.7 billion to private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity as economies grapple with the impacts of global compounding crises. For more information, visit www.ifc.org.
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