By Sizwe Dlamini
The Government of the Kingdom of Eswatini, through Absa Bank Limited, has issued a R4 billion bond programme on the Johannesburg Stock Exchange’s (JSE) debt board.
According to a JSE press release this new issuance is the latest bond to list under the “Protea Bonds” segment, which features ZAR-denominated bond issuances by foreign governments on the JSE.
The Kingdom of Eswatini’s inaugural bond under this programme, a ZAR 400 million issuance, was offered at a yield to maturity of 11.875% per annum with a maturity period of three years.
The unsecured fixed-rate notes programme involved an initial auction on 8 May 2024 and will mature on 8 May 2027. The listing on the JSE provides investors with a convenient and transparent platform to trade and invest in Eswatini’s Protea Bond, marking a significant step towards supporting regional African development through the local bond market.
“The listing on the JSE represents a key milestone for the Government of the Kingdom of Eswatini and provides an opportunity for the Kingdom to introduce itself to the international investment community. This programme will help us diversify our funding sources, contribute to regional economic integration initiatives, and raise the necessary capital required for us to meet our infrastructure and developmental needs. Choosing to list in the South African market represents a demonstration of our confidence in the South African markets given our participation in the Common Monetary Area and strong economic links with South Africa,” said Neal Rijkenberg, Eswatini’s Finance Minister.
Valdene Reddy, Director of Capital Markets at the JSE, notes in the press release that Sovereign bonds are an important tool for governments to raise funds for large and critical capital projects such as roads, power stations, and hospitals.
She said they were thrilled that the Government of the Kingdom of Eswatini identified the JSE as the capital raising venue of choice, and believes the issuance will enable the issuer to diversify its debt portfolio and access alternative funding.
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