Ecobank Nigeria secures N50bn subordinated  10-year loan

By Kayode Tokede

Ecobank Transnational Incorporated (ETI), the parent of the Ecobank Group, has confirmed  that one of its significant subsidiaries, Ecobank Nigeria, secured N50 billion, 10-Year bilateral subordinated loan.

In a notification at the Nigerian Stock Exchange (NSE), the bilateral funding was said to provide stable medium-term liquidity to the balance sheet of Ecobank Nigeria and positively improved its balance sheet ratios, especially the capital adequacy ratio by circa 300 basis points.

“The transaction proceeds would be deployed to support Micro, Small and Medium Scale Enterprises (MSMEs) and Small Corporates,” the Group Head, Corporate Communications, ETI, Adenike Laoye in a statement said.

ETI had earlier recorded 11per cent rise in its interest income to N139.6 billion for Q3 2020.

Subordinated loans have lower priority than other debt instruments in case of liquidation. They are only repayable after other debts have been paid.

This debt can either be secured or unsecured and it typically has a lower credit rating and higher yield than other senior debt.