The Rand Merchant Bank (RMB) has raised $3 billion worth of South African sovereign bonds on behalf of the national treasury, the corporate and investment unit of banking group FirstRand announced on Tuesday.
The issue follows Moody’s revising South Africa’s outlook from ‘stable’ to ‘negative’, saying the country’s improved fiscal outlook would help the government stabilize its medium-term debt burden. .
The transaction was 2.3 times oversubscribed, issued in two tranches, raising $1.4 billion in 10-year bonds with a coupon of 5.875% and $1.6 billion in 30-year bonds with a coupon of of 7.30%, RMB, said a co-lead manager of the transaction. .
“The capital raise was particularly successful against a global backdrop of heightened market volatility, falling emerging market bond prices and rising short-term interest rates,” said Lwandile Nene, Chief Agent of RMB’s International Debt Capital Markets team, in a statement.
Dollar-denominated bonds are rated investment grade by rating agency Moody’s, while S&P and Fitch place them at junk status and must be listed on the Luxembourg Stock Exchange.
The bank said it worked with the Absa Bank/HSBC and Deutsche Bank/Nedbank consortia as lead arrangers.
The National Treasury did not immediately respond to a request for comment.