The Eastern and Southern African Trade and Development Bank (PTA Bank) recently issued the first Eurobond of an East African issuer. It is also the first Eurobond in sub-Saharan Africa since 2007.
A Eurobond is a bond that is issued in a currency other than the one used by the issuing country. In the case of the PTA Bank Eurobond it was denominated in U.S. Dollars. The bond was issued to raise funding for small-and-medium size enterprises in eastern and southern Africa. The bond currently trades on the Luxembourg Stock Exchange.
The PTA Bank was established during the development of the preferential trade are of Eastern and Southern African states which later became the Common Market for Eastern and Southern Africa (COMESA). Currently, the Bank’s membership includes the following member states: Burundi, Comoros, China, Djibouti, Egypt, Eritrea, Ethiopia, Kenya, Malawi, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tanzania, Uganda, Zambia, Zimbabwe. The African Development Bank (ADB) is the only institutional shareholder.
Interestingly, the Peoples Republic of China is also a member. It joined in 2000 as the first non-regional sovereign state.
As an institution of COMESA the banks purpose is to facilitate developmental financing. The issuance of this Eurobond is fairly historic because the last one issued was in 2007 and it is a first for East Africa. It is exciting to see the bank access the international markets this way.