Afrinvest (West Africa) Limited has announced the launch of its N5 billion commercial paper notes as the Series 1 and Series 2 of its N25 billion commercial paper issuance program.
According to the announcement by the company, the Series 1 Commercial Paper notes will have a tenor of 180 days and a yield rate of 16.5%. The Series 2 Commercial Paper notes have a tenor of 270 days and a yield rate of 18%.
There is a minimum subscription amount of N1 million, with multiples of N1000 thereafter. The offer for the Commercial Paper closes on Wednesday, January 24, 2024. And the Commercial Papers will be traded on the FMDQ Exchange.
Afrinvest currently has a short-term rating of A3 from GCR Ratings and BBB- from Agusto & Co.
What you should know
In 2024, Nigerian companies have issued about N90 billion in commercial papers, in line with the N1.5 trillion worth of commercial papers issued in 2023.
With yield rates of 16.5 % and 18%, the Afrinvest Series 1 and 2 CPs are towering above yields on the Treasury Bills issued by the CBN on January 10, 2024, which boasted yields of 2.44%, 4.22%, and 8.399% for the 91-day, 182-day, and 364-day bills respectively.
Read More: Commercial papers in Nigeria in 2023: 6 key things to note – Nairametrics
Similar to treasury bills, commercial papers are short-term debt instruments. Nevertheless, while treasury bills are issued by the government, commercial papers, often referred to as ‘CPs,’ are issued by private corporations, companies, and financial institutions to secure capital for short-term funding requirements.
