Nigeria’s leading non-interest bank, TAJBank, has announced its intention to issue a N20 billion Mudarabah Sukuk bond as part of its strategy to reinforce its Additional Tier 1 capital.
The bank’s Founder and Chief Executive Officer, Mr Hamid Joda, disclosed this in a statement on Monday, noting that the issuance is a component of TAJBank’s N100 billion Sukuk programme, which is aimed at driving the institution’s business expansion.
Joda highlighted that this initiative follows the successful issuance of Nigeria’s first-ever N10 billion Sukuk bond on the Nigerian Exchange in 2023.
The forthcoming bond presents an attractive opportunity for investors, offering a competitive annual return of 20.5%.
“This new Mudarabah Sukuk bond has been designed to provide a stable and ethical investment avenue, allowing investors to partake in the bank’s profit-sharing ventures. It reflects TAJBank’s dedication to broadening access to innovative financial solutions and advancing financial inclusion across the country,” Joda stated.
The Mudarabah Sukuk bond is open to both individual and corporate investors. Joda underlined the bank’s commitment to delivering a reliable stream of supplementary income that can be conveniently accessed.
“We are delighted to introduce this Mudarabah Sukuk to the market, presenting an appealing investment option that aligns with ethical financial principles.
By listing on the NGX, we are enabling a wider pool of investors to participate in our growth and benefit from our profit-sharing structure,” he added.
Joda urged potential investors to seek advice from their financial consultants or visit the bank’s website for comprehensive details on the Sukuk and the listing process.
TAJBank’s Milestone in Islamic Finance
In recent developments, the Nigerian Exchange Limited (NGX) last month admitted TAJBank’s N10 billion Sukuk Mudarabah onto its platform, marking the occasion with a closing gong ceremony.
During the event, the Divisional Head of Capital Markets at NGX, Mr Jude Chiemeka, praised the efforts of TAJBank’s leadership and the key entities involved in the issuance, including Greenwich Merchant Bank as the Lead Issuing House; 117 Capital & Buraq Capital as Joint Sharia Advisers; and United Capital as Brokers for the transaction.
The N10 billion issuance, which offers an annual return of 15%, represents an innovative blend of equity and debt, serving as Additional Tier 1 Capital. It is the first of its kind in Nigeria, signifying a significant milestone in the country’s Islamic finance sector.
Operating under Islamic banking principles, TAJBank has established itself as a leader in the non-interest banking industry.
The N10 billion Sukuk Mudarabah was issued as part of the bank’s N100 billion Sukuk programme, aimed at enhancing its capital adequacy ratio and supporting long-term growth.