The supranational placed a RF3.511bn ($5.1m) 9% February 2018 note on February 13. Leads Citi and Standard Bank priced the deal at par.
Five international investors bought the paper.
“In theory this should open up the currency for other international issuers to follow,” said a niche currency banker in London. “But most issuers need the ability to swap back into dollars and there is only liquidity in the swap market to one year, maybe two years, which is what we usually see in Nigerian naira or Ghanaian cedi.
“The longer you go in maturity the more difficult it gets to swap back into dollars.
“But still, this will allow banks themselves to issue structured notes and supranationals to issue short dated bonds in the currency.”
Jingdong Hua, IFC vice president for treasury and syndications, announced the deal at the East African Capital Markets Conference held in Rwanda’s capital Kigali on February 12 and 13.
“International investors are eager to participate in the African growth story, and Rwanda is emerging as a leader in tapping the interest of these investors,” said Hua.
IFC aims to use the bond to encourage further foreign investment in Rwanda.
The deal came a day after Euroclear decided to add Rwandan francs to its approved list of denomination currencies.
Rwandan minister of finance and economic planning Claver Gatele said: “Rwanda’s economic development path undeniably requires more private capital flows. A vibrant capital market is a required condition for sustainable development.
“IFC is playing a leading role in continuously providing ground breaking transactions for developing countries and by bringing new products and new investors to our playing fields.”
The supranational first sold a Rwandan franc bond in the currency’s onshore market. It became the first international issuer to print in the currency when it raised RF15bn with a 12.25% five year sold in May 2014.
“Rwanda has a strong vision for development that is backed up by improving policies and regulation that are fuelling strong growth,” said Oumar Seydi, IFC director for Eastern and Southern Africa. “IFC is keen to help private investors contribute more to the development of one of Africa’s most dynamic economies.”
Rupees and roubles
The supranational was busy in non-core currencies on February 13, also printing in Indian rupees and Russian roubles.
It placed a Rp6.25bn ($100.6m) tap of a 7.8% June 2019 line, taking the outstanding total to Rp26.25bn. Citi, Deutsche Bank and JP Morgan priced the deal at 109.43.
IFC also sold a Rb300m ($4.8m) February 2017 private medium term note through JP Morgan. The clip pays a coupon of 6% and was priced at 95.
