AFC Debuts $500m Perpetual Hybrid Bond

Africa Finance Corporation (AFC), the continent’s leading infrastructure lender, has successfully issued its inaugural $500 million perpetual hybrid bond, setting a new benchmark for African institutions in the global capital markets.

This transaction, priced at a 7.50 percent coupon with no fixed maturity date, highlights AFC’s expertise in raising funds to support transformative infrastructure projects across Africa. The bond, which attracted overwhelming investor interest, peaked at $1.1 billion in orders and closed with a 1.5 times oversubscription.

The issuance strengthens AFC’s capital base, bolstering its financial flexibility while providing investors with a secure initial non-callable period of 5.25 years. Thereafter, the corporation will manage the bond as part of its broader financial strategy.

The corporation has a strong track record of sponsoring infrastructure projects in Nigeria and across the continent. Beyond funding, AFC provides financial advice and support for third-party development costs to advance critical initiatives. Recently, it secured $200 million in funding for the BUA Group, supporting essential sectors and boosting job creation in Nigeria.

A unique blend of equity and debt, the hybrid instrument offers 100 peercent equity credit recognition from Moody’s Investor Services. This feature strengthens AFC’s balance sheet while preserving the flexibility required for long-term growth.

Mr. Samaila Zubairu, President & CEO of AFC, remarked on the significance of the issuance, stating: “This landmark inaugural hybrid bond highlights AFC’s unwavering dedication to advancing bold and transformative infrastructure projects across Africa. Through innovative financial instruments, we are mobilising global capital to support Africa’s sustainable development, industrialization, and integration, notwithstanding tightening financial conditions.”

Mr. Banji Fehintola, Executive Board Member and Head of Financial Services at AFC, described the issuance as a milestone for both the corporation and the continent. “This hybrid bond issuance demonstrates the confidence global investors have in AFC’s ability to deliver transformative development across Africa. By strengthening our equity base and diversifying our funding sources, we are well positioned to drive infrastructure solutions that accelerate Africa’s industrialization and economic transformation,” Mr. Fehintola said.

This perpetual non-call 5.25-year hybrid issuance not only reinforces AFC’s leadership in structuring complex financial instruments but also unlocks new capital markets for African institutions. It sets a precedent for diversifying funding sources while advancing sustainable growth across the continent.