Michael Lee-Chin, a Jamaican-Canadian businessman and one of the world’s Black billionaires, is leading NCB Financial Group Limited’s $9.3 million refinanced bond offer, which has roughly doubled interest rates from three years ago. The bond offering, which begins on July 22 and ends on August 29, is led by NCB Capital Markets Limited, which serves as the main broker.
The instrument will not be listed on the Jamaica Stock Exchange, but bondholders will be able to trade their bonds in blocks of $10,000 ($6.25) through the broker-facilitated private market.
The bond is divided into three tranches, giving investors a choice based on their investment horizon and yield expectations. The tranches are priced with coupons of 11.5 percent, 12 percent, and 12.5 percent, with tenors of two, three, and five years, respectively.
In 2021, NCB Financial raised J$15 billion ($9.375 million) at a 6% interest rate. The current offer, situated against a backdrop of high interest rates, is aimed at debt refinance.
NCB Financial allows for early repayment of the bond, in whole or in part, without penalty. The principal will be repaid in full at maturity, and the term sheet contains covenants such as maintaining capital above 10% of assets and keeping subsidiaries solvent.
The bond includes provisions for forced principal repayment and immediate due and payable accumulated interest in the event of default. The bonds will be registered as highly rated debt instruments with the Financial Services Commission, and JCSD Trustee Services Limited will serve as trustee.
In June, NCB Financial attempted to raise J$5 billion ($3.125 million) with an additional public offering of new ordinary shares, with the option to increase the amount to J$7.5 billion ($4.687 million).
However, due to price worries, the offer only raised J$2.5 billion ($1.562 million), making it the largest capital raise in the stocks market this year.
With $152 billion ($95 million) in corporate bonds due by 2025 and $50 million raised earlier this year in bond offerings, the new bond offer is NCB Financial’s second endeavor to boost its capital following the lukewarm reaction to its APO last month.
The parent business of National Commercial Bank Jamaica, established in 1837, has lately started a relief project through its foundation.
With assets of J$163.17 billion ($1.05 billion) and a strong market presence, NCBFG remains committed to furthering Jamaica’s social and economic growth through strategic philanthropy and community participation.