The Eastern and Southern African Trade and Development Bank (PTA Bank) is pleased to announce the successful financial close of its second Tanzanian Shillings denominated bond. The Thirty Two Billion Six Hundred Million (TZS 32.6 BN) bond with a five year tenor will support the Tanzanian Electric Supply Company (TANESCO) in its operations. The innovative Bond structure is comprised of a floating rate and a fixed rate portion, both of which have been oversubscribed.
In June 2013, PTA Bank committed a seven year financing facility of TZS 32.6BN to TANESCO for the purposes of power generation equipment.. Initially, PTA Bank raised a one year bridge loan facility in the aforementioned amount, while arranging the issuance of the Bond. This financing arrangement is in line with PTA Bank’s development mandate.
The transactions were made possible with the support of the Government of Tanzania through the Ministry of Finance, the Central Bank of Tanzania and the Capital Markets Authority. The successful collaboration between CfC Stanbic Bank and Stanbic Bank Tanzania in their roles of Joint Lead Arrangers, ATZ Law Chambers as Legal Counsel, and KPMG East Africa as Auditors was critical to the success of this landmark local currency issue.
PTA Bank was established as an international financial institution on 6 November 1985 pursuant to the provisions of Chapter 9 of the Treaty (1981) establishing the Preferential Trade Area for the Eastern and Southern African States (PTA), later transformed to the Common Market for Eastern and Southern Africa (COMESA).
PTA Bank’s mission is to be at the forefront of providing development capital and services to advance regional economic growth and integration, through customer focused and innovative financing solutions. Headquartered in Burundi, PTA Bank has regional offices in Kenya, Mauritius and Zimbabwe.
TANESCO is a parastatal organization created in 1964 and owned by the Government of Tanzania. Its core business involves generation, transmission, distribution and sale of electricity to the Tanzania mainland, and bulk power supply to the island of Zanzibar.
The Company serves consumers across the residential, light commercial, business, government and industrial sectors. TANESCO owns and manages approximately two-third of the power generation and 100% of the transmission and distribution facilities in Tanzania.
Admassu Tadesse, President of PTA Bank commented: “We are very pleased to have issued a local currency bond in Tanzania and to have the capacity to provide local currency financing to a key infrastructure enterprise of state to partner with the private sector in the provision of power solutions. PTA Bank is also pleased to be stimulating Tanzania’s capital markets, which will be an important source of local currency financing infrastructure and other sectors”