LAPO Microfinance Bank has launched a N10 billion five-year fixed-rate bond, offering investors yields of up to 20 per cent as it taps the domestic capital market to fund growth and deepen financial inclusion.
The issuance, under its N30 billion Debt Issuance Programme, opened on March 23, 2026, and is scheduled to close on April 1, 2026.
The bond, issued through LAPO Funding SPV Plc, is a five-year senior unsecured instrument with:
- Coupon range of 19.00 per cent – 20.00 per cent per annum (to be finalised after book building)
- Semi-annual interest payments
- Bullet repayment, with principal repaid at maturity
- Minimum subscription of N20 million
The offer carries a BBB- rating from both Agusto & Co. and GCR, indicating moderate credit risk.
The bond’s pricing places it above comparable Federal Government of Nigeria (FGN) bonds, which currently yield around 16 per cent for similar tenors.
At an assumed average coupon of 19.5 per cent, a minimum investment of N20 million would generate about N3.9 million annually, paid in two installments.
LAPO’s financial performance underpins the offer. Over the past five years, the bank has recorded:
- 25.48 per cent compound annual growth in profit
- Profit after tax of N9.146 billion in 2025, up 32 per cent year-on-year
- Net interest income rising to N59.456 billion
- Loan book growth from N75 billion (2021) to N118 billion (2025)
Total assets stood at N143 billion, with a capital adequacy ratio of 29 per cent, well above regulatory requirements.
The bank has also successfully redeemed previous bond issuances in 2017 and 2020, reinforcing investor confidence.
Proceeds from the bond will be used to expand access to financial services for micro, small, and medium enterprises (MSMEs) and underserved communities across Nigeria.
Founded in 1987, LAPO Microfinance Bank operates in 34 states and the Federal Capital Territory, focusing on low-income households and small businesses.
Despite the attractive returns, the bond presents a high-risk, high-reward profile:
- Investors face credit risk, as the bond is not government-backed
- Interest rate risk could lock investors into fixed returns if market rates change
- Lack of early exit options reduces flexibility
The LAPO bond offers a compelling opportunity for yield-seeking investors willing to take on moderate credit risk, backed by the bank’s strong growth trajectory and track record in Nigeria’s microfinance sector.
