LAPO MFB SPV Plc, the special purpose vehicle wholly owned by LAPO Microfinance Bank Limited, has successfully raised N4.46 billion through its debut Series 1 Senior Unsecured Fixed Rate Bond, with just six investors accounting for more than 80 per cent of total subscriptions.
The bond offer, issued under the company’s N30 billion bond programme, achieved a 100 per cent subscription rate, reflecting strong investor appetite despite a challenging interest rate environment.
According to allotment data approved by the Securities and Exchange Commission, the offer attracted 31 applications, all of which were accepted, with no rejections recorded.
The five-year bond, due in 2031, carries a fixed coupon rate of 20 per cent per annum and was targeted at qualified institutional investors and high-net-worth individuals.
Although 31 investors participated in the transaction, the allotment structure revealed a high concentration of subscriptions among a small group of large investors.
Data from the offer shows that:
- Two investors subscribed within the 500,001–1,000,000 units category, collectively investing N2 billion, representing 44.86 per cent of the total amount raised.
- Assuming equal allocation, each investor committed approximately N1 billion.
- Four additional investors in the 100,001–500,000 units category invested a combined N1.6 billion, accounting for another 35.89 per cent of the issue.
Together, these six investors subscribed to about N3.6 billion worth of bonds, representing 80.75 per cent of the entire N4.46 billion offer.
The remaining 25 investors shared just N855.6 million, or 19.25 per cent of total subscriptions.
At the lower end of the spectrum, three investors in the smallest subscription category invested a combined N3 million, highlighting the significant disparity in participation levels.
The subscription pattern underscores a growing trend in Nigeria’s debt capital market, where bond offers may be broadly available but are often anchored by a handful of institutional investors and ultra-high-net-worth individuals.
While the average investment per subscriber stood at approximately N143.8 million, the figure is heavily influenced by the largest participants.
Excluding the six biggest investors, the average subscription among the remaining investors falls to about N34.2 million, indicating a much smaller scale of participation from other market players.
The bond’s 20 per cent fixed coupon was priced against a backdrop of elevated interest rates, with the Central Bank of Nigeria’s Monetary Policy Rate standing at 27.5 per cent and Treasury Bill yields ranging between 18 and 22 per cent depending on tenor.
For investors committing N1 billion each, the bond translates to an annual income stream of approximately N200 million over five years, making it an attractive fixed-income instrument for long-term investors seeking stable returns.
LAPO Microfinance Bank remains one of Nigeria’s largest microfinance institutions, with a strong focus on lending to low-income women, small businesses, and micro-entrepreneurs across the country.
The SPV structure enables the institution to access long-term capital from the debt market without placing additional pressure on its regulated banking balance sheet.
As a senior unsecured instrument, the bond ranks ahead of equity holders but behind secured creditors in the event of liquidation, making credit quality and portfolio performance important considerations for investors.
