Ecobank to refinance $350m bond with new tier 2 notes

By Chukwuma Umeorah

Ecobank Transnational Incorporated (ETI) is seeking to raise fresh funds from international debt capital markets through the issuance of Fixed Rate Reset Tier 2 Nature Notes, with proceeds earmarked to retire an existing $350 million bond obligation.

The pan-African lender disclosed this to the Nigerian Exchange Limited (NGX) and the investing public on May 7, 2026, that the new notes would be issued under the United States Securities and Exchange Commission Rule 144A and Regulation S, and would be used to finance a concurrent any-and-all tender offer of its “U.S.$350 million 8.750% Tier 2 notes due June 2031.” The move signals a deliberate liability management exercise, allowing the group to replace existing debt on potentially revised terms before the 2031 maturity date.

Beyond refinancing, ETI said proceeds would also go toward green-eligible assets. The group said it “will allocate an amount equivalent to the full net proceeds of the issue of the Notes to finance or re-finance, in part or in full, new and/or existing eligible assets” under its Green Bond Framework, linking the transaction to its broader sustainability commitments.

The notes, branded as “Nature Notes,” are expected to be listed on the London Stock Exchange (LSE) and traded on its regulated market, giving the instrument international visibility and broadening its potential investor base beyond Africa.

ETI cautioned, however, that the transaction “is subject to prevailing market conditions and the conclusion of the necessary Transaction documentation,” leaving room for the deal to be revised or withdrawn.

The announcement was made simultaneously to the NGX, the Ghana Stock Exchange, and the Bourse Régionale des Valeurs Mobilières — the three exchanges on which ETI is publicly listed. The disclosure was signed by Ayo Adepoju, Ph.D., Group Executive Director and Chief Financial Officer.

The debt market move comes against the backdrop of a solid first quarter. For the three months ended March 31, 2026, profit before tax grew to N270.3 billion, while profit after tax rose 5.6 per cent year-on-year to N197.5 billion, driven by growth in both interest and non-interest income.

Net interest income surged 20 per cent to N540 billion, supported in part by a decline of over 23 per cent in interest expenses on borrowed funds, which fell to N54 billion. Total operating income reached N882 billion, up 12 per cent, buoyed by strong cash management and related fees of N118 billion. Customer deposits grew during the quarter to N36.81 trillion, accounting for more than 75 per cent of total assets.

On the expense side, operating expenses increased by 6 per cent and consumed over 49 per cent of operating revenue. Elevated impairment charges, however, remain a constraint, with a sharp rise in credit impairments moderating overall earnings growth and keeping profitability expansion in check in the near term.

Ecobank Group operates across 34 African countries, employs approximately 14,000 people, and serves more than 30 million customers across consumer, commercial, and corporate banking segments.