ALCB Fund invests an additional XOF 6.1 billion in CRRH-UEMOA (Caisse Régionale de Refinancement Hypothecaire de l’UEMOA).
The ALCB Fund has invested XOF 6.1 billion (USD 10 million) in CRRH-UEMOA (Caisse Régionale de Refinancement Hypothecaire de l’UEMOA) bond issuance of XOF 36 billion (UDS 60 million). This marks a follow-on investment in the issuer after two previous investments of XOF 1.5 billion (USD 3.1 million) in Q4 2013 and XOF 844 million (USD 1.5 million) in Q4 2017. The current bond transaction, which closed on January 27, 2023, is for a tenor of fifteen years and has a coupon rate of 6.1%. The transaction was fully subscribed with co-investors encompassing development finance institutions and local institutional investors, including asset managers and pension funds.
CRRH-UEMOA is a regional financial institution that operates as a residential mortgage refinancing vehicle in the West African Economic and Monetary Union (UEMOA). CRRH-UEMOA addresses gaps in the mortgage market by providing long-dated funding to extend the maturity of mortgage loans, improve the affordability of mortgages and extend the pool of potential borrowers in the region. The bond proceeds will be used to refinance mortgage portfolios of banks across the UEMOA region.
Brock Hoback, Managing Director, Lead of ALCB Fund, said: “The ALCB Fund is elated to be part of this landmark transaction in the UEMOA. Supporting the CRRH-UEMOA bond issuance aligns closely with the mandate of the Fund, which is to channel domestic capital to developmental sectors, including affordable housing. The fund is glad to have played a vital role in ensuring a successful issuance by the company”.
Yedau Ogoundele, CEO of CRRH-UEMOA, said: “CRRH-UEMOA is grateful for the fundamental role ALCB Fund has played during this important transaction, making it successful. We are committed to addressing and improving the affordability of mortgages in UEMOA. The proceeds from this transaction will refinance mortgage loans originated by shareholder banks. The ALCB Fund is a strong investor and a catalyst to the development of capital markets”.
The ALCB Fund was founded by KFW in 2012 on behalf of the German Ministry for Economic Cooperation and Development (BMZ). The Fund’s mission is to support the development of African capital markets by promoting primary corporate bond issuances in local currency. This is achieved by supporting African issuers, investors and intermediaries by acting as an anchor investor and providing technical assistance.
To date, the ALCB Fund has invested in over 35 companies across 17 countries. The Fund is rated Baa2 by Moody’s.
The ALCB fund is managed by LHGP Asset Management, a subsidiary company of Lion’s Head Group Ltd.