Ecobank Transnational Incorporated (ETI) has launched a private placement of $250 million in conditional convertible bonds over a period of ten days, with the support of Renaissance Capital Africa (RenCap) as transaction advisor, demonstrating its willingness to rely on high-level international financial expertise.
This fundraising, approved by shareholders at the extraordinary general meeting on May 28, 2025 in Lomé, is part of a strategy aimed at strengthening the group’s financial strength, supporting its long-term growth, and increasing its competitiveness across its African markets.
In a statement, ETI specified that the operation involves an issuance of Additional Tier 1 (AT1) capital securities, designed in accordance with Basel III prudential standards. This type of instrument allows financial institutions to strengthen their regulatory capital without immediate dilution for existing shareholders.
The AT1 instrument will be convertible into ordinary shares, under certain conditions, and denominated in USD. The conversion price will be determined based on the five-day volume-weighted average price (VWAP) of ETI’s shares on the Nigerian Exchange (NGX), converted to USD at the prevailing rate, or at a floor price of $0.01 per share, whichever is higher.
“This proposed capital increase represents a strategic initiative by ETI to strengthen its capital adequacy, improve its financial resilience, and support its long-term growth ambitions across its diversified pan-African banking platform,” emphasized the group.
This placement comes in a regional context marked by expected tightening of regulatory requirements and increasing integration of African banking systems. Several African countries (Nigeria, Kenya, UEMOA countries) have recently initiated or are considering raising minimum capital thresholds for commercial banks, prompting banking groups to anticipate these developments.
The use of an AT1 instrument, still relatively rare in African markets, positions Ecobank as an innovative financial player capable of diversifying its sources of funding while adhering to international standards.
This issuance follows a successful operation in May, where ETI raised $125 million in the market, with demand reaching $235 million, representing an oversubscription of 88%. The final interest rate was set at 9.375%, 37.5 basis points below the indicative range, reflecting strong investor confidence.
