[2008-06-12]  Barclays eyes share refunds with bond
Barclays Bank of Kenya Wednesday moved to tap the increased liquidity in the market.

It is offering investors a Sh2 billion investment opportunity under its Sh5 billion bond medium-term note programme launched last year.

Disappointed Safaricom investors with Sh100,000 to spare will have an opportunity to buy into the bank’s credit papers to be retired in 2015.

Their allocation

Investors, however, can resell their allocation at the Nairobi Stock Exchange beginning July 21.

“This is very critical to our business growth,” managing director, Adan Mohamed said.

Long-term financing allows a bank to grow its loan book by supporting long-term lending to customers without straining the bank’s resources.

“The bond will help Barclays extend the maturity of its liability portfolio and support and enhance our asset generating capacity’’, added the chief executive.

The issue opened Wednesday and closes on July 19, 2008.

Applications for the credit papers, available at the bank’s placement agent, Suntra Investment Bank, and all Barclay’s branches countrywide, opened yesterday and run until July 19.

“Investors can also apply through their brokers,” added Maina Kihara, the bank’s head of Treasury. Allocation will be announced on July 14.

The first bank

The first issue of Sh1 billion attracted a 115 per cent subscription in December last year.

It made Barclays the first bank in Kenya to seek financing of its operations by issuing corporate bonds.

The bonds will be available in both fixed and floating rate pricing with interest paid semi-annually.

“As the economy expands the demand for long-term loans from our customers to finance long-term investments has been rising and the corporate bond programme offers us a timely opportunity to respond to these needs’,” said Mr Mohamed.

It is the second in a series of issues to follow as part of the Sh5 billion medium-term note programme.

Source: Nation Media Group 2007