NMB Bank has successfully listed its inaugural sustainability bond, the NMB Jamii Bond, on the London Stock Exchange (LSE). This cross-listing represents a significant milestone for African climate finance, providing an unprecedented opportunity for institutional investors from the world’s largest capital markets to channel funds into sustainable development projects across the continent.
The original issuance of the NMB Jamii Bond, which was the largest sustainability bond ever issued in East Africa, raised a remarkable TZS 400 billion ($159 million) through its Tanzanian shilling and U.S. dollar tranches. This impressive fundraising effort underscores the growing capacity of local investors to meet the increasing demand for climate and sustainability financing.
British International Investment (BII), the UK’s development finance institution, served as a co-anchor investor in the Tanzanian shilling tranche of the bond alongside the International Finance Corporation (IFC). BII, which committed $15 million equivalent in Tanzanian shillings, has underscored its dedication to climate finance, aiming for at least 30 per cent of its total commitments in this sector. Last year alone, BII invested $1.3 billion into African businesses.
Christopher Chijiutomi, Managing Director and Head of Africa at BII, stated: “The NMB listing represents a unique opportunity for UK and global investors to directly participate in Africa’s future. It will enhance vital inward investment into Africa and act as a proof point that sustainable development vehicles of this type can be attractive to the world’s largest institutional investors in London and elsewhere.”
The UK’s commitment to this venture was further highlighted by Deputy Foreign Secretary and Minister for Development and Africa, Andrew Mitchell. He commented: “The UK is proud to have supported NMB’s Jamii Bond in Tanzania – through British International Investment’s anchor investment and FSD Africa’s technical assistance support. It is the first sustainability bond to be offered in East Africa, highlighting the UK’s ongoing commitment to financing progress towards the UN’s Sustainable Development Goals and driving a green and sustainable future for the region.”
NMB Bank’s Chief Executive, Ms Ruth Zaipuna, expressed her pride in the achievement: “Today’s listing of the Jamii Bond cements NMB Bank’s position as a trailblazer in sustainability within the African capital markets. This extraordinary success highlights the strong confidence Tanzanian and global investors have in NMB Bank’s soundness and commitment to sustainability across operations, business, community, and environment.”
The NMB Jamii Bond’s listing on the LSE is a vital development for African climate investment, a sector that requires an estimated $277 billion annually to meet 2030 climate goals, according to the Climate Policy Initiative. From 2019 to 2020, private sector financing constituted only 14 per cent of Africa’s total climate finance, underscoring the need for increased investment.
Julia Hoggett, CEO of LSE plc, added: “We are delighted to welcome NMB Bank’s sustainability bond to the London Stock Exchange. This not only highlights NMB’s dedication to transparency and commitment to their sustainability objectives, but also showcases the continued international investor support that issuers across Africa can find in London. We are a leading global hub for sustainable finance and proud to be at the forefront of enabling capital flows towards the green economy.”
FSD Africa, the UK’s flagship development finance programme in Africa, played a crucial role by providing technical assistance for NMB Bank’s portfolio review and securing a Second Party Opinion for the bond’s alignment with international standards. Mark Napier, Chief Executive of FSD Africa, remarked: “Listing of the NMB sustainability bond on the LSE is a great milestone, and it signals the potential that entities in the African region have to tap sustainable finance both within and beyond the African continent.”
The successful cross-listing of the NMB Jamii Bond not only boosts liquidity in Africa’s growth markets but also signifies a robust vote of confidence from global investors in the continent’s sustainable development trajectory. As Africa strides towards its climate and development goals, initiatives like the NMB Jamii Bond will be pivotal in mobilising the necessary capital to drive impactful change.
