ADB bond oversubscribed by 55 per cent

Stakeholders say there is need for the government to improve funding for district trade. 

By MARTIN LUTHER OKETCH

In Summary

Growth in oversubscription indicates investors’ confidence in the market.

KAMPALA

The tranche of African Development Bond, which was listed on the Uganda Securities Exchange (USE) yesterday, was oversubscribed 55 per cent, indicating an ever-increasing demand for long term financing for infrastructure development in Uganda.

In 2012, ADB listed its first Medium-Term Note of Shs12.5 billion of the total Shs125 billion that was to be issued on USE to finance for infrastructure and other development projects in the country was oversubscribed by 50 per cent.

The executive director of African Alliance Uganda, Mr Kenneth Kitariko, said the ADB bond was taken by the four local pension fund managers and one foreign individual.
Mr Kitariko attributed the increased attractivenesss of the ADB bond to the banks high credit rating of triple A.

The ADB continually fundraises in foreign currency. The rating agencies, Standard &Poor’s , Moody’s Fitch and Japan Credit Rating Agency reaffirmed their AAA/Aaa and AA+/Aa1 rating of the bank’s senior and subordinated debt respectively, with a stable outlook.

The chief education specialist and Architect Uganda office, Dr Jason Mosomi Mochache, said the subscribers to the second issuance of ADB bond included both local and international investors which included pension funds insurance companies and asset managers.