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Fidelity Bank to Sell N50bn Bond in Q4


Fidelity Bank Plc plans to issue up to N50 billion in local bonds by the fourth quarter to refinance existing debt as yields fall.

Reuters quoted the bank’s Chief Operations and Information Officer, Gbolahan Joshua, to have said this during an analysts’ call.

Bond yields have declined on the local debt market after an oil price crash triggered by the novel coronavirus pandemic caused foreign investors to dump naira assets, leaving money markets awash with liquidity.

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The new issue would be made to redeem an existing N30 billion bond issued at 16.48 percent.
Debt market yields have dropped from a high of 18 percent three years ago. Yields on the one-year treasury bills are quoted under five percent.

The mid-tier lender said it expects to see a 15 percent drop in profit this year compared with 2019, citing the impact of the coronavirus pandemic.

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It said profit before tax had increased by 21.9 percent to N12 billion in the half-year.
Fidelity Bank’s income declined in the second quarter due to a downward review of lending rates on loans backed by development finance institutions and an economic slowdown.