Chase Bank Kenya initiates Kes.10 Billion Medium Term Multi Currency Note Programme.

Chase Bank Kenya has launched its Kes.10 Billion Medium Term Multi Currency Note Programme today.

The aim of the launch is to give a go-ahead for the bank to raise additional capital to strengthen its capital base and support its strategic initiatives like lending segments for SME’s run by the youth, women, agri business and also to finance expansion of the branch network, investment in IT and product development initiatives.

The note will be issued in several tranches with the first tranche issued in Kenya Shillings. The bank which is celebrating 20 years of existence has recorded impressive growth over the years. “Our recently released Q1 2015 results illustrate the sustained growth of the bank which is well on course for another year of record profitability. This proves that this is the right bank to invest in” Mr. Zafrullah Khan, Chase Bank Kenya Chairman said.

With a Green Shoe Option of Kes.2Billion, the Bank will raise Kes.3Billion from the 1st tranche. A Green Shoe Option is a clause contained in the bond underwriting agreement that allows the bank as the issuer to take up an additional Kes.2Billion if the initial Kes.3Billion is oversubscribed. With a coupon of 13.1%, the issue is the highest yielding of several corporate bonds issued over the last two years.

Chase Bank CEO Paul Njaga said, “The issue will go a long way in maintaining the bank’s pace of growth. We are an ambitious bank that is keen on exceeding our stakeholder’s expectations and want investors to play a part in writing another chapter of our growth story.”

Samy Ghannam, Associate Director and Corporate Finance at Genghis Capital added that the Note programme is being issued at a time of high investor interest and confidence in Corporate Bonds. Current yields are sustainable in light of the long-term domestic macroeconomic environment factors. In addition, by having a multi-currency programme the bank will also be in a position to leverage from the success of Kenya’s debut Eurobond which saw high subscription levels.

The total assets of the bank grew by 36% to Kes.119.5Bn in Quarter 1 2015 compared to a similar period in 2014 while Profit after Tax rose 47% to Kes.634Million over the same period. Genghis Capital Investment Bank, an associate company of Chase Bank, is the Lead Transaction Advisor and Co Placing Agent while NIC Capital is the Co-Arranger and Co-Placing Agent for the issue.

Chase bank Kenya is looking forward to oversubscription by diverse investor segments in consideration of its attractive investment return, the bank’s historical financial performance and its ambitious strategic plans.